Supplement dated February 6, 1998
to the
Prospectus dated May 1, 1997 for Park Avenue Life (Generic Policy Form
Number 95-MPVL) and to the
Prospectus dated December 10, 1997 for Park Avenue Life (Generic Policy Form
Number 97-MPVL)
The following supplemental information should be read in conjunction with
the Prospectuses dated May 1, 1997 (as supplemented September 15, 1997) and
December 10, 1997 for the Variable Whole Life Insurance Policies with Modified
Scheduled Premiums (the "Policies") issued by The Guardian Insurance & Annuity
Company, Inc. ("GIAC") through The Guardian Separate Account K and marketed
under the name "Park Avenue Life".
New Variable Investment Options
Thirteen new variable investment options have been added to the Policies
and are available both for the allocation of premiums and transfers of Unloaned
Policy Account Value by existing Policyowners. All references throughout the
Prospectus to the variable investment options available under the Policies shall
be modified to reflect the addition of these thirteen new funds. Set forth below
is a description of each fund's investment objective, typical portfolio
investments and investment adviser.
Baillie Gifford Emerging Markets Fund
The investment objective of the Baillie Gifford Emerging Markets Fund
("Emerging Markets Fund") is long-term growth of capital. The Emerging Markets
Fund will, under normal conditions, invest at least 65% of its total assets in a
portfolio of common stocks issued by emerging market companies and in securities
that are convertible into such common stocks.
Guardian Baillie Gifford Limited ("GBG") serves as investment adviser and
principal underwriter of the Emerging Markets Fund. The Emerging Markets Fund
pays GBG an investment advisory fee at an annual rate of 1.00% of the fund's
average daily net assets for the services and facilities GBG provides to the
fund. GBG has appointed Baillie Gifford Overseas Limited ("BG Overseas") to
serve as sub-investment adviser to the Emerging Markets Fund. One half of the
investment advisory fee paid by the Emerging Markets Fund to GBG is payable by
GBG to BG Overseas for its services as the fund's sub-investment adviser. No
separate or additional fee is paid by the fund to BG Overseas.
Gabelli Capital Asset Fund
The primary investment objective of the Gabelli Capital Asset Fund is
growth of capital, with current income as a secondary objective. Typical
investments will include U.S. common stocks and convertible securities.
Gabelli Capital Asset Fund is managed by Guardian Investor Services
Corporation ("GISC"), which has appointed Gabelli Funds, Inc. ("GFI") as the
investment adviser to the Fund. GFI has its principal offices at One Corporate
Center, Rye, New York 10580. The fund pays GISC a management fee at an annual
rate of 1.00% of its average daily net assets for services and facilities which
GISC provides to the fund. For its services as investment adviser, GISC pays GFI
0.75% of the management fee which GISC receives from the fund. No separate or
additional fee is paid by the fund to GFI.
MFS Emerging Growth Series, MFS Total Return Series and MFS Bond Series
The investment objective of the MFS Emerging Growth Series is long-term
growth of capital. It will typically invest in U.S. common stocks of emerging
growth companies.
The investment objective of the MFS Total Return Series is to seek
above-average income (compared to a portfolio invested entirely in equity
securities), consistent with prudent employment of capital, and secondarily to
provide a reasonable opportunity for growth of capital and income. It will
invest in a diversified portfolio of equity securities and non-convertible fixed
income securities.
The investment objective of the MFS Bond Series is to provide as high a
level of current income as is believed consistent with prudent investment risk
and secondarily to protect shareholders' capital.
The MFS Emerging Growth Series, MFS Total Return Series and MFS Bond
Series are advised by Massachusetts Financial Services Company ("MFS"). MFS is a
subsidiary of Sun Life of Canada (U.S.), which is itself an indirect wholly
owned subsidiary of Sun Life Assurance Company of Canada. As compensation for
its services to the series, MFS
- --------------------------------------------------------------------------------
1
<PAGE>
receives a fee, payable monthly, at an annual rate of 0.75%, 0.75%, and 0.60% of
the average daily net assets of the Emerging Growth Series, Total Return Series
and Bond Series, respectively.
American Century VP Value Fund and American Century VP International Fund
The investment objective of the American Century VP Value Fund is
long-term capital growth with income as a secondary objective. The fund will
invest in equity securities of well-established intermediate-to-large companies
whose securities are believed to be undervalued.
The investment objective of the American Century VP International Fund is
capital growth. It will invest in international common stocks with the potential
for appreciation.
The American Century VP Value Fund and the American Century VP
International Fund are advised by American Century Investment Management, Inc.
("ACIM"), American Century Tower, 4500 Main Street, Kansas City, Missouri 64111.
ACIM, a registered investment adviser under the Advisers Act, has been providing
investment advisory services to investment companies and institutional investors
since it was founded in 1958. Each of the American Century funds pays ACIM an
investment advisory fee at an annual rate of 1.00% and 1.50% of the average
daily net assets of the VP Value Fund and the VP International Fund,
respectively.
AIM V.I. Value Fund and AIM V.I. Capital Appreciation Fund
The investment objective of the AIM V.I. Value Fund is to seek long-term
growth of capital by investing primarily in undervalued stocks, with income as a
secondary objective. It will seek to achieve this investment objective by
investing in common stocks, convertible bonds and convertible preferred stocks,
preferred stock and debt instruments of companies whose securities are deemed
undervalued.
The investment objective of the AIM V.I. Capital Appreciation Fund is to
seek capital appreciation by investing in stocks with an emphasis on
medium-sized and smaller emerging growth companies.
AIM V.I. Value Fund and AIM V.I. Capital Appreciation Fund are advised by
A I M Advisors, Inc., ("AIM"), 11 Greenway Plaza, Suite 100, Houston, Texas
77046. AIM, a registered investment adviser under the Advisers Act, was
organized in 1976 and, together with its subsidiaries, manages or advises
numerous investment company portfolios. AIM is a wholly-owned subsidiary of A I
M Management Group Inc. which in turn is an indirect subsidiary of AMVESCAP plc,
(formerly AMVESCO plc and, prior thereto, INVESCO plc). AMVESCAP plc and its
subsidiaries are an independent investment management group engaged in
institutional investment management and retail mutual fund businesses in the
United States, Europe and the Pacific Region. The AIM V.I. Value Fund and AIM
V.I. Capital Appreciation Fund each pay AIM an investment advisory fee at an
annual rate of 0.64% of the fund's average daily net assets.
Fidelity VIP III* Growth Opportunities Portfolio, Fidelity VIP* Equity-Income
Portfolio, Fidelity VIP* High Income Portfolio, and Fidelity VIP II* Index 500
Portfolio
The investment objective of the Fidelity VIP III Growth Opportunities
Portfolio is capital growth. It typically invests in common stocks and
convertible securities.
The investment objective of the Fidelity VIP Equity-Income Portfolio is to
seek reasonable income with capital appreciation as a secondary objective. It
will typically invest in income-producing equity securities.
The investment objective of the Fidelity VIP High Income Portfolio is to
seek a high level of current income. In pursuing this objective it will
typically invest in high-yielding debt securities with an emphasis on
lower-quality securities.
- ----------
* VIP, VIP II, and VIP III refer to Variable Insurance Products Fund,
Variable Insurance Products Fund II, and Variable Insurance Products Fund
III, respectively.
- --------------------------------------------------------------------------------
2
<PAGE>
The investment objective of the Fidelity VIP II Index 500 Portfolio is to
seek a total return that corresponds to that of the Standard & Poor's 500 Index.
In pursuing this objective it will typically invest in equity securities of
companies that compose the Standard & Poor's 500 and in other instruments that
are based on the value of the Index.
The Fidelity VIP III Growth Opportunities Portfolio, Fidelity VIP
Equity-Income Portfolio, Fidelity VIP High Income Portfolio, and Fidelity VIP II
Index 500 Portfolio are advised by Fidelity Management & Research Company
("FMR"), 82 Devonshire Street, Boston, Massachusetts 02109. FMR, a registered
investment adviser under the Advisers Act, is the management arm of Fidelity
Investments, which was established in 1946. Each of the Fidelity portfolios pays
FMR an investment advisory fee at annual rates of 0.61%**, 0.51%**, 0.59%**, and
0.28%*** for the Growth Opportunities, Equity-Income, High Income, and Index 500
Portfolios, respectively. On behalf of the High Income and Growth Opportunities
Portfolios, FMR has sub-investment advisory agreements with two affiliates, FMR
U.K. and FMR Far East. FMR U.K. and FMR Far East are compensated for providing
FMR with investment research and advice with fees equal to 110% and 105%,
respectively, of the costs of providing these services. On behalf of the High
Income Portfolio, the sub-investment advisers may also provide investment
management services in return for which they receive a fee equal to 50% of FMR's
management fee rate. No separate or additional fee is paid by the portfolios to
the sub-adviser.
Effective December 1, 1997, Bankers Trust Company ("BT") has been
appointed sub-investment adviser to the Index 500 Portfolio. BT, a New York
banking corporation with principal offices at 130 Liberty Street, New York, New
York 10006, is a wholly owned subsidiary of Bankers Trust New York Corporation.
For investment management, securities lending and custodial services to the
Index 500 Portfolio, FMR pays BT fees at an annual rate of 0.006% of the average
net assets of the Portfolio. No separate or additional fee is paid by the
Portfolio to BT.
- ----------
** The management fees for the Growth Opportunities, Equity-Income and High
Income Portfolios consist of a group fee rate and an individual fee rate.
The fee stated herein is the result of adding these components together
and multiplying the result by the portfolios' average net assets. Please
refer to the Fidelity prospectuses for a complete explanation of the
applicable portfolio's management fee.
*** The investment advisory fee for the Index 500 Portfolio will be 0.24%
after 12/31/96.
- --------------------------------------------------------------------------------
3
<PAGE>
A more detailed description of the foregoing funds, their investment
objectives, policies, investment managers, asset charges and the risks
associated with investing in them may be found in the accompanying prospectuses.
Read the prospectuses carefully before investing.
The new Funds may not be available in all states.
This Supplement should be retained with the Prospectus for future reference
- --------------------------------------------------------------------------------
4
<PAGE>
The following Appendix replaces Appendix A of the
supplement dated September 15, 1997 to the
Prospectus dated May 1, 1997 for Park Avenue Life
- --------------------------------------------------------------------------------
5
<PAGE>
APPENDIX A
ILLUSTRATIONS OF DEATH BENEFITS, POLICY ACCOUNT VALUES,
NET CASH SURRENDER VALUES AND ACCUMULATED POLICY PREMIUMS
The following tables illustrate how the Policies operate. Specifically,
they show how the death benefit, Net Cash Surrender Value and Policy Account
Value can vary over an extended period of time assuming hypothetical gross rates
of return (i.e., investment income and capital gains and losses, realized or
unrealized) for the Separate Account that are equal to constant after tax annual
rates of 0%, 6% and 12%. The tables are based on policies with Face Amounts of
$250,000 for male insureds at Ages 35 and 45. These insureds are assumed to be
in the nonsmoker preferred risk classification. Values are first given based on
current charges and then based on the policy's higher guaranteed charges. In
addition, each illustration is given first for a policy with an Option 1 death
benefit and then for a policy with an Option 2 death benefit. These
illustrations may assist in the comparison of death benefits, Net Cash Surrender
Values and Policy Account Values for Park Avenue Life policies with those under
other variable life insurance policies which may be issued by GIAC or other
companies. Prospective policyowners are advised, however, that it may not be
advantageous to replace existing life insurance coverage by purchasing a Park
Avenue Life policy, particularly if the decision to replace existing coverage is
based solely on a comparison of policy illustrations.
Death benefits, Net Cash Surrender Values and Policy Account Values will
be different from the amounts shown if: (1) the actual gross rates of return
average 0%, 6% or 12%, but vary above and below the average over the period; and
(2) Policy Premiums are paid at other than annual intervals, or if unscheduled
payments are made. Benefits and values will also be affected by the
policyowner's allocation of the Unloaned Policy Account Value among the Variable
Investment Options and the fixed-rate option. If the actual gross rate of return
for all options averages 0%, 6% or 12%, but varies above or below that average
for individual options, allocation and transfer decisions can have a significant
impact on a policy's performance. Policy loans and other policy transactions,
such as skipping Policy Premiums and partial withdrawals, will also affect
results, as will the insured's sex, smoker status and premium class.
Death benefits, Net Cash Surrender Values and Policy Account Values shown
in the tables reflect the fact that: (1) deductions have been made from annual
Policy Premiums for Policy Premium Assessments, the state premium tax charge,
the DAC tax charge and the premium sales charge; and (2) Monthly Deductions are
deducted from the Policy Account Value on each Monthly Date. The Net Cash
Surrender Values shown in the tables reflect the fact that surrender charges
(consisting of a deferred sales charge and a deferred administrative charge) are
deducted upon surrender, Face Amount reduction or lapse during the first 12
policy years. The death benefits, Net Cash Surrender Values and Policy Account
Values also reflect a daily charge assessed against the Separate Account for
mortality and expense risks equivalent to an annual charge of .60% (on a current
basis) and .90% (on a guaranteed basis) of the average daily value of the assets
in the Separate Account attributable to the policies. See "Deductions and
Charges." The amounts shown in the illustrations also reflect an average of the
investment advisory fees and operating expenses incurred by the mutual funds, at
an annual rate of 0.87% of the average daily net assets of such funds.
The average is based upon actual expenses incurred during 1996 for all
funds except that The Guardian Small Cap Stock Fund's expenses have been
estimated since the Fund was not available before 1997. Operating expenses for
the MFS Growth With Income Series, Emerging Growth Series, and Total Return
Series for 1996 were capped at 0.25% of the average daily net assets of the
series and operating expenses for the MFS Bond Series were capped at 0.40% of
the average daily net assets of the series pursuant to the agreement with the
adviser. Operating expenses for the Fidelity VIP III Growth Opportunities
Portfolio reflect the effects of expense reduction arrangements with third
parties which occurred during the year ended December 31, 1996. Operating
expenses for the Fidelity VIP Equity-Income Portfolio reflect the effects of
expense reduction arrangements with third parties which occurred during the year
ended December 31, 1996. The results for the Fidelity Index 500 Portfolio
reflect the effects of expense reimbursement of certain fund expenses which
occurred during the year ended December 31, 1996. In the absence of these
arrangements, operating expenses of the various funds, and the average
investment advisory fees and expenses used in the following illustrations would
have been higher.
Taking account of the charges for mortality and expense risks in the
Separate Account and the average investment advisory fee and operating expenses
of the mutual funds, the gross annual rates of return of 0%, 6% and
- --------------------------------------------------------------------------------
A-1
<PAGE>
12% correspond to net investment experience at constant annual rates of -1.46%,
4.50% and 10.46%, respectively, based on GIAC's current charge for mortality and
expense risks, and -1.76%, 4.18% and 10.13%, respectively, based on GIAC's
guaranteed maximum charge for mortality and expense risks. See "Net Investment
Factor."
The hypothetical rates of return shown in the tables do not reflect any
tax charges attributable to the Separate Account since no charges are currently
made. If any such charges are imposed in the future, the gross annual rate of
return would have to exceed the rates shown by an amount sufficient to cover the
tax charges, in order to produce the death benefits, Net Cash Surrender Values
and Policy Account Values illustrated. See "GIAC's Taxes."
The second column of each table shows the amount which would accumulate if
an amount equal to the annual Policy Premium was invested to earn interest,
after taxes, of 5% per year, compounded annually. There can be no assurance that
a prospective policyowner would be able to earn this return. During the
Guaranteed Premium Period, the annual Policy Premium is $2,225 for the first
policy illustrated and $3,515 for the second policy illustrated.
GIAC will furnish upon request an illustration reflecting the proposed
insured's Age, sex, premium class and the Face Amount or Basic Scheduled Premium
requested, but a premium-based illustration must reflect GIAC's current minimum
Face Amount requirement for Park Avenue Life -- which is $100,000.
From time to time, advertisements or sales literature for Park Avenue Life
may quote historical performance data of one or more of the underlying funds,
and may include cash surrender values and death benefit figures computed using
the same methodology as that used in the following illustrations, but with
average annual total return of the underlying funds for which performance data
is shown in the advertisement or sales literature replacing the hypothetical
rates of return shown in the following tables. This information may be shown in
the form of graphs, charts, tables, and examples. Any such information is
intended to show the policy's investment experience based on the historical
experience of the underlying funds and is not intended to represent what may
happen in the future.
GIAC began to offer Park Avenue Life on September 1, 1995. As such the
policies may not have been available when the funds commenced their operations.
However, illustrations may be based on the actual investment experience of the
funds since their respective inception dates (See "Investment Performance of the
Funds"). The results for any period prior to the policies' being offered would
be calculated as if the policies had been offered during that period of time,
with all charges assumed to be those applicable to the policies. Thus the
illustrations will reflect deductions for each fund's expenses, as well as the
Separate Account's charge for mortality and expense risks, and the charges
deducted from premiums, Monthly Deductions and any transaction deductions
associated with the policy in question.
- --------------------------------------------------------------------------------
A-2
<PAGE>
Male Issue Age 35, Non-Smoker, Preferred Underwriting Risk
$250,000 Face Amount
Death Benefit Option 1
These values reflect CURRENT cost of insurance and other charges
<TABLE>
<CAPTION>
Premiums Net Cash Surrender Value Policy Account Value Death Benefit
Accumulated Assuming Hypothetical Gross Assuming Hypothetical Gross Assuming Hypothetical Gross
End of at 5% Annual Return of: Annual Return of: Annual Return of:
Policy Interest --------------------------- --------------------------- ---------------------------
Year Per Year 0% 6% 12% 0% 6% 12% 0% 6% 12%
- ---- -------- --- --- ---- --- --- ---- --- --- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 2,336 0 0 0 1,441 1,544 1,647 250,000 250,000 250,000
2 4,789 1,134 1,430 1,739 2,857 3,153 3,462 250,000 250,000 250,000
3 7,365 2,624 3,206 3,837 4,225 4,807 5,438 250,000 250,000 250,000
4 10,070 4,177 5,140 6,229 5,611 6,574 7,663 250,000 250,000 250,000
5 12,909 5,682 7,127 8,826 6,950 8,395 10,093 250,000 250,000 250,000
6 15,891 7,141 9,170 11,652 8,242 10,270 12,752 250,000 250,000 250,000
7 19,022 8,555 11,270 14,731 9,489 12,204 15,664 250,000 250,000 250,000
8 22,309 9,932 13,441 18,099 10,699 14,208 18,866 250,000 250,000 250,000
9 25,761 11,241 15,652 21,755 11,841 16,252 22,355 250,000 250,000 250,000
10 29,385 12,498 17,922 25,746 12,931 18,355 26,179 250,000 250,000 250,000
15 50,413 18,102 30,391 52,358 18,102 30,391 52,538 250,000 250,000 250,000
20 77,250 20,954 43,567 94,222 20,954 43,567 94,222 250,000 250,000 250,000
25 111,502 21,074 57,678 161,818 21,074 57,678 161,818 250,000 250,000 314,424
30 155,218 18,482 73,436 269,146 18,482 73,436 269,146 250,000 250,000 458,083
</TABLE>
IT IS EMPHASIZED THAT THE HYPOTHETICAL RESULTS SHOWN ABOVE AND ELSEWHERE IN THIS
PROSPECTUS ARE ILLUSTRATIVE ONLY AND SHOULD NOT BE DEEMED A REPRESENTATION OF
PAST OR FUTURE GROSS ANNUAL RATES OF RETURN. ACTUAL RESULTS MAY BE HIGHER OR
LOWER THAN THOSE SHOWN AND WILL DEPEND ON A NUMBER OF FACTORS, INCLUDING THE
ALLOCATIONS MADE BY A POLICYOWNER, THE FREQUENCY OF THE PREMIUM PAYMENTS MADE BY
A POLICYOWNER, THE INVESTMENT EXPERIENCE OF THE POLICY'S VARIABLE INVESTMENT
OPTIONS, AND THE RATE OF INTEREST PAID ON AMOUNTS HELD IN THE FIXED-RATE OPTION.
THE DEATH BENEFIT, POLICY ACCOUNT VALUE AND NET CASH SURRENDER VALUE FOR A
POLICY WOULD BE DIFFERENT FROM THOSE SHOWN IF THE ACTUAL GROSS ANNUAL RATES OF
RETURN AVERAGED 0%, 6% AND 12% OVER A PERIOD OF YEARS, BUT VARIED ABOVE AND
BELOW THAT AVERAGE DURING THE PERIOD. THEY WOULD ALSO BE DIFFERENT IF ANY POLICY
LOANS OR OTHER POLICY TRANSACTIONS WERE EFFECTED DURING THE PERIOD. NO
REPRESENTATIONS CAN BE MADE BY GIAC OR THE MUTUAL FUNDS THAT THE ILLUSTRATED
HYPOTHETICAL RATES OF RETURN CAN BE ACHIEVED FOR ANY ONE YEAR OR SUSTAINED OVER
ANY PERIOD OF TIME.
THE RECALCULATED BASIC SCHEDULED PREMIUM (ROUNDED TO THE NEAREST DOLLAR) AT AGE
70 WOULD BE $17,490, ASSUMING THE 0% RETURN; $6,985, ASSUMING THE 6% RETURN; AND
$2,225, ASSUMING THE 12% RETURN.
- --------------------------------------------------------------------------------
A-3
<PAGE>
Male Issue Age 35, Non-Smoker, Preferred Underwriting Risk
$250,000 Face Amount
Death Benefit Option 1
These values reflect GUARANTEED cost of insurance and other charges
<TABLE>
<CAPTION>
Premiums Net Cash Surrender Value Policy Account Value Death Benefit
Accumulated Assuming Hypothetical Gross Assuming Hypothetical Gross Assuming Hypothetical Gross
End of at 5% Annual Return of: Annual Return of: Annual Return of:
Policy Interest --------------------------- --------------------------- ---------------------------
Year Per Year 0% 6% 12% 0% 6% 12% 0% 6% 12%
- ---- -------- --- --- ---- --- --- ---- --- --- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 2,336 0 0 0 1,436 1,539 1,641 250,000 250,000 250,000
2 4,789 964 1,254 1,556 2,687 2,977 3,279 250,000 250,000 250,000
3 7,365 2,292 2,850 3,457 3,892 4,450 5,058 250,000 250,000 250,000
4 10,070 3,639 4,549 5,581 5,073 5,983 7,015 250,000 250,000 250,000
5 12,909 4,936 6,284 7,874 6,203 7,551 9,142 250,000 250,000 250,000
6 15,891 6,178 8,049 10,349 7,279 9,149 11,449 250,000 250,000 250,000
7 19,022 7,361 9,841 13,018 8,294 10,774 13,952 250,000 250,000 250,000
8 22,309 8,485 11,661 15,903 9,252 12,428 16,670 250,000 250,000 250,000
9 25,761 9,546 13,505 19,021 10,146 14,106 19,622 250,000 250,000 250,000
10 29,385 10,543 15,374 22,396 10,977 15,807 22,830 250,000 250,000 250,000
15 50,413 14,412 24,970 44,105 14,412 24,970 44,105 250,000 250,000 250,000
20 77,250 15,589 34,315 77,239 15,589 34,315 77,239 250,000 250,000 250,000
25 111,502 12,540 41,838 129,063 12,540 41,838 129,063 250,000 250,000 250,778
30 155,218 2,423 44,498 208,635 2,423 44,498 208,635 250,000 250,000 355,093
</TABLE>
IT IS EMPHASIZED THAT THE HYPOTHETICAL RESULTS SHOWN ABOVE AND ELSEWHERE IN THIS
PROSPECTUS ARE ILLUSTRATIVE ONLY AND SHOULD NOT BE DEEMED A REPRESENTATION OF
PAST OR FUTURE GROSS ANNUAL RATES OF RETURN. ACTUAL RESULTS MAY BE HIGHER OR
LOWER THAN THOSE SHOWN AND WILL DEPEND ON A NUMBER OF FACTORS, INCLUDING THE
ALLOCATIONS MADE BY A POLICYOWNER, THE FREQUENCY OF THE PREMIUM PAYMENTS MADE BY
A POLICYOWNER, THE INVESTMENT EXPERIENCE OF THE POLICY'S VARIABLE INVESTMENT
OPTIONS, AND THE RATE OF INTEREST PAID ON AMOUNTS HELD IN THE FIXED-RATE OPTION.
THE DEATH BENEFIT, POLICY ACCOUNT VALUE AND NET CASH SURRENDER VALUE FOR A
POLICY WOULD BE DIFFERENT FROM THOSE SHOWN IF THE ACTUAL GROSS ANNUAL RATES OF
RETURN AVERAGED 0%, 6% AND 12% OVER A PERIOD OF YEARS, BUT VARIED ABOVE AND
BELOW THAT AVERAGE DURING THE PERIOD. THEY WOULD ALSO BE DIFFERENT IF ANY POLICY
LOANS OR OTHER POLICY TRANSACTIONS WERE EFFECTED DURING THE PERIOD. NO
REPRESENTATIONS CAN BE MADE BY GIAC OR THE MUTUAL FUNDS THAT THE ILLUSTRATED
HYPOTHETICAL RATES OF RETURN CAN BE ACHIEVED FOR ANY ONE YEAR OR SUSTAINED OVER
ANY PERIOD OF TIME.
THE RECALCULATED BASIC SCHEDULED PREMIUM (ROUNDED TO THE NEAREST DOLLAR) AT AGE
70 WOULD BE $17,490, ASSUMING THE 0% RETURN; $14,982, ASSUMING THE 6% RETURN;
AND $2,225, ASSUMING THE 12% RETURN.
- --------------------------------------------------------------------------------
A-4
<PAGE>
Male Issue Age 35, Non-Smoker, Preferred Underwriting Risk
$250,000 Face Amount
Death Benefit Option 2
These values reflect CURRENT cost of insurance and other charges
<TABLE>
<CAPTION>
Premiums Net Cash Surrender Value Policy Account Value Death Benefit
Accumulated Assuming Hypothetical Gross Assuming Hypothetical Gross Assuming Hypothetical Gross
End of at 5% Annual Return of: Annual Return of: Annual Return of:
Policy Interest --------------------------- --------------------------- ---------------------------
Year Per Year 0% 6% 12% 0% 6% 12% 0% 6% 12%
- ---- -------- --- --- ---- --- --- ---- --- --- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 2,336 0 0 0 1,441 1,544 1,647 250,000 250,000 250,000
2 4,789 1,134 1,430 1,739 2,857 3,153 3,462 250,000 250,000 250,000
3 7,365 2,624 3,206 3,837 4,225 4,807 5,438 250,000 250,000 250,000
4 10,070 4,177 5,140 6,229 5,611 6,574 7,663 250,000 250,000 250,000
5 12,909 5,682 7,127 8,826 6,950 8,395 10,093 250,000 250,000 250,000
6 15,891 7,141 9,170 11,652 8,242 10,270 12,752 250,000 250,000 250,000
7 19,022 8,555 11,270 14,731 9,489 12,204 15,664 250,000 250,000 250,000
8 22,309 9,932 13,441 18,099 10,699 14,208 18,866 250,000 250,000 250,000
9 25,761 11,241 15,652 21,755 11,841 16,252 22,355 250,000 250,000 250,000
10 29,385 12,498 17,922 25,746 12,931 18,355 26,179 250,000 250,000 250,000
15 50,413 18,102 30,391 52,346 18,102 30,391 52,346 250,000 250,000 254,096
20 77,250 20,954 43,567 93,694 20,954 43,567 93,694 250,000 250,000 279,694
25 111,502 21,074 57,678 159,357 21,074 57,678 159,357 250,000 250,000 328,357
30 155,218 18,482 73,436 265,066 18,482 73,436 265,066 250,000 250,000 451,137
</TABLE>
IT IS EMPHASIZED THAT THE HYPOTHETICAL RESULTS SHOWN ABOVE AND ELSEWHERE IN THIS
PROSPECTUS ARE ILLUSTRATIVE ONLY AND SHOULD NOT BE DEEMED A REPRESENTATION OF
PAST OR FUTURE GROSS ANNUAL RATES OF RETURN. ACTUAL RESULTS MAY BE HIGHER OR
LOWER THAN THOSE SHOWN AND WILL DEPEND ON A NUMBER OF FACTORS, INCLUDING THE
ALLOCATIONS MADE BY A POLICYOWNER, THE FREQUENCY OF THE PREMIUM PAYMENTS MADE BY
A POLICYOWNER, THE INVESTMENT EXPERIENCE OF THE POLICY'S VARIABLE INVESTMENT
OPTIONS, AND THE RATE OF INTEREST PAID ON AMOUNTS HELD IN THE FIXED-RATE OPTION.
THE DEATH BENEFIT, POLICY ACCOUNT VALUE AND NET CASH SURRENDER VALUE FOR A
POLICY WOULD BE DIFFERENT FROM THOSE SHOWN IF THE ACTUAL GROSS ANNUAL RATES OF
RETURN AVERAGED 0%, 6% AND 12% OVER A PERIOD OF YEARS, BUT VARIED ABOVE AND
BELOW THAT AVERAGE DURING THE PERIOD. THEY WOULD ALSO BE DIFFERENT IF ANY POLICY
LOANS OR OTHER POLICY TRANSACTIONS WERE EFFECTED DURING THE PERIOD. NO
REPRESENTATIONS CAN BE MADE BY GIAC OR THE MUTUAL FUNDS THAT THE ILLUSTRATED
HYPOTHETICAL RATES OF RETURN CAN BE ACHIEVED FOR ANY ONE YEAR OR SUSTAINED OVER
ANY PERIOD OF TIME.
THE RECALCULATED BASIC SCHEDULED PREMIUM (ROUNDED TO THE NEAREST DOLLAR) AT AGE
70 WOULD BE $17,490, ASSUMING THE 0% RETURN; $6,985, ASSUMING THE 6% RETURN; AND
$2,225, ASSUMING THE 12% RETURN.
- --------------------------------------------------------------------------------
A-5
<PAGE>
Male Issue Age 35, Non-Smoker, Preferred Underwriting Risk
$250,000 Face Amount
Death Benefit Option 2
These values reflect GUARANTEED cost of insurance and other charges
<TABLE>
<CAPTION>
Premiums Net Cash Surrender Value Policy Account Value Death Benefit
Accumulated Assuming Hypothetical Gross Assuming Hypothetical Gross Assuming Hypothetical Gross
End of at 5% Annual Return of: Annual Return of: Annual Return of:
Policy Interest --------------------------- --------------------------- ---------------------------
Year Per Year 0% 6% 12% 0% 6% 12% 0% 6% 12%
- ---- -------- --- --- ---- --- --- ---- --- --- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 2,336 0 0 0 1,436 1,539 1,641 250,000 250,000 250,000
2 4,789 964 1,254 1,556 2,687 2,977 3,279 250,000 250,000 250,000
3 7,365 2,292 2,850 3,457 3,892 4,450 5,058 250,000 250,000 250,000
4 10,070 3,639 4,549 5,581 5,073 5,983 7,015 250,000 250,000 250,000
5 12,909 4,936 6,284 7,874 6,203 7,551 9,142 250,000 250,000 250,000
6 15,891 6,178 8,049 10,349 7,279 9,149 11,449 250,000 250,000 250,000
7 19,022 7,361 9,841 13,018 8,294 10,774 13,952 250,000 250,000 250,000
8 22,309 8,485 11,661 15,903 9,252 12,428 16,670 250,000 250,000 250,000
9 25,761 9,546 13,505 19,021 10,146 14,106 19,622 250,000 250,000 250,000
10 29,385 10,543 15,374 22,396 10,977 15,807 22,830 250,000 250,000 250,000
15 50,413 14,412 24,970 44,105 14,412 24,970 44,105 250,000 250,000 250,000
20 77,250 15,589 34,315 77,063 15,589 34,315 77,063 250,000 250,000 263,063
25 111,502 12,540 41,838 126,983 12,540 41,838 126,983 250,000 250,000 295,983
30 155,218 2,423 44,498 202,847 2,423 44,498 202,847 250,000 250,000 352,347
</TABLE>
IT IS EMPHASIZED THAT THE HYPOTHETICAL RESULTS SHOWN ABOVE AND ELSEWHERE IN THIS
PROSPECTUS ARE ILLUSTRATIVE ONLY AND SHOULD NOT BE DEEMED A REPRESENTATION OF
PAST OR FUTURE GROSS ANNUAL RATES OF RETURN. ACTUAL RESULTS MAY BE HIGHER OR
LOWER THAN THOSE SHOWN AND WILL DEPEND ON A NUMBER OF FACTORS, INCLUDING THE
ALLOCATIONS MADE BY A POLICYOWNER, THE FREQUENCY OF THE PREMIUM PAYMENTS MADE BY
A POLICYOWNER, THE INVESTMENT EXPERIENCE OF THE POLICY'S VARIABLE INVESTMENT
OPTIONS, AND THE RATE OF INTEREST PAID ON AMOUNTS HELD IN THE FIXED-RATE OPTION.
THE DEATH BENEFIT, POLICY ACCOUNT VALUE AND NET CASH SURRENDER VALUE FOR A
POLICY WOULD BE DIFFERENT FROM THOSE SHOWN IF THE ACTUAL GROSS ANNUAL RATES OF
RETURN AVERAGED 0%, 6% AND 12% OVER A PERIOD OF YEARS, BUT VARIED ABOVE AND
BELOW THAT AVERAGE DURING THE PERIOD. THEY WOULD ALSO BE DIFFERENT IF ANY POLICY
LOANS OR OTHER POLICY TRANSACTIONS WERE EFFECTED DURING THE PERIOD. NO
REPRESENTATIONS CAN BE MADE BY GIAC OR THE MUTUAL FUNDS THAT THE ILLUSTRATED
HYPOTHETICAL RATES OF RETURN CAN BE ACHIEVED FOR ANY ONE YEAR OR SUSTAINED OVER
ANY PERIOD OF TIME.
THE RECALCULATED BASIC SCHEDULED PREMIUM (ROUNDED TO THE NEAREST DOLLAR) AT AGE
70 WOULD BE $17,490, ASSUMING THE 0% RETURN; $14,982, ASSUMING THE 6% RETURN;
AND $2,225, ASSUMING THE 12% RETURN.
- --------------------------------------------------------------------------------
A-6
<PAGE>
Male Issue Age 45, Non-Smoker, Preferred Underwriting Risk
$250,000 Face Amount
Death Benefit Option 1
These values reflect CURRENT cost of insurance and other charges
<TABLE>
<CAPTION>
Premiums Net Cash Surrender Value Policy Account Value Death Benefit
Accumulated Assuming Hypothetical Gross Assuming Hypothetical Gross Assuming Hypothetical Gross
End of at 5% Annual Return of: Annual Return of: Annual Return of:
Policy Interest --------------------------- --------------------------- ---------------------------
Year Per Year 0% 6% 12% 0% 6% 12% 0% 6% 12%
- ---- -------- --- --- ---- --- --- ---- --- --- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 3,691 246 409 572 2,290 2,452 2,615 250,000 250,000 250,000
2 7,566 2,429 2,898 3,386 4,513 4,982 5,471 250,000 250,000 250,000
3 11,635 4,726 5,647 6,647 6,675 7,596 8,596 250,000 250,000 250,000
4 15,908 7,096 8,621 10,345 8,839 10,365 12,088 250,000 250,000 250,000
5 20,394 9,400 11,687 14,377 10,938 13,225 15,916 250,000 250,000 250,000
6 25,104 11,598 14,808 18,738 12,931 16,140 20,071 250,000 250,000 250,000
7 30,050 13,639 17,933 23,412 14,766 19,060 24,539 250,000 250,000 250,000
8 35,243 15,497 21,036 28,406 16,418 21,958 29,328 250,000 250,000 250,000
9 40,696 17,158 24,104 33,747 17,875 24,820 34,463 250,000 250,000 250,000
10 46,422 18,612 27,122 39,465 19,122 27,633 39,976 250,000 250,000 250,000
15 79,641 24,860 43,711 78,030 24,860 43,711 78,030 250,000 250,000 250,000
20 122,038 28,114 62,299 141,300 28,114 62,299 141,300 250,000 250,000 250,000
25 176,149 26,309 81,963 243,791 26,309 81,963 243,791 250,000 250,000 368,989
30 245,209* 73,392 119,690 401,150 73,392 119,690 401,150 250,000 250,000 549,061
</TABLE>
- ----------
* After Policy Year 25 premiums are subject to recalculation because the
Guaranteed Premium Period has expired. The amount shown at the end of the
Policy Year 30 in the column entitled "Premiums Accumulated at 5% Interest
Per Year" reflects a premium recalculated based upon a 12% gross annual
return. Assuming a premium recalculated based upon a 0% gross annual return,
the Premiums Accumulated at 5% Interest Per Year at the end of Policy Year
30 would be $318,086, and assuming a premium recalculated based upon a 6%
gross annual return, the Premiums Accumulated at 5% Interest Per Year at the
end of Policy Year 30 would be $265,832.
IT IS EMPHASIZED THAT THE HYPOTHETICAL RESULTS SHOWN ABOVE AND ELSEWHERE IN THIS
PROSPECTUS ARE ILLUSTRATIVE ONLY AND SHOULD NOT BE DEEMED A REPRESENTATION OF
PAST OR FUTURE GROSS ANNUAL RATES OF RETURN. ACTUAL RESULTS MAY BE HIGHER OR
LOWER THAN THOSE SHOWN AND WILL DEPEND ON A NUMBER OF FACTORS, INCLUDING THE
ALLOCATIONS MADE BY A POLICYOWNER, THE FREQUENCY OF THE PREMIUM PAYMENTS MADE BY
A POLICYOWNER, THE INVESTMENT EXPERIENCE OF THE POLICY'S VARIABLE INVESTMENT
OPTIONS, AND THE RATE OF INTEREST PAID ON AMOUNTS HELD IN THE FIXED-RATE OPTION.
THE DEATH BENEFIT, POLICY ACCOUNT VALUE AND NET CASH SURRENDER VALUE FOR A
POLICY WOULD BE DIFFERENT FROM THOSE SHOWN IF THE ACTUAL GROSS ANNUAL RATES OF
RETURN AVERAGED 0%, 6% AND 12% OVER A PERIOD OF YEARS, BUT VARIED ABOVE AND
BELOW THAT AVERAGE DURING THE PERIOD. THEY WOULD ALSO BE DIFFERENT IF ANY POLICY
LOANS OR OTHER POLICY TRANSACTIONS WERE EFFECTED DURING THE PERIOD. NO
REPRESENTATIONS CAN BE MADE BY GIAC OR THE MUTUAL FUNDS THAT THE ILLUSTRATED
HYPOTHETICAL RATES OF RETURN CAN BE ACHIEVED FOR ANY ONE YEAR OR SUSTAINED OVER
ANY PERIOD OF TIME.
THE RECALCULATED BASIC SCHEDULED PREMIUM (ROUNDED TO THE NEAREST DOLLAR) AT AGE
70 WOULD BE $16,170, ASSUMING THE 0% RETURN; $7,720, ASSUMING THE 6% RETURN; AND
$3,515, ASSUMING THE 12% RETURN.
- --------------------------------------------------------------------------------
A-7
<PAGE>
Male Issue Age 45, Non-Smoker, Preferred Underwriting Risk
$250,000 Face Amount
Death Benefit Option 1
These values reflect GUARANTEED cost of insurance and other charges
<TABLE>
<CAPTION>
Premiums Net Cash Surrender Value Policy Account Value Death Benefit
Accumulated Assuming Hypothetical Gross Assuming Hypothetical Gross Assuming Hypothetical Gross
End of at 5% Annual Return of: Annual Return of: Annual Return of:
Policy Interest --------------------------- --------------------------- ---------------------------
Year Per Year 0% 6% 12% 0% 6% 12% 0% 6% 12%
- ---- -------- --- --- ---- --- --- ---- --- --- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 3,691 238 400 563 2,282 2,444 2,606 250,000 250,000 250,000
2 7,566 2,144 2,602 3,080 4,228 4,686 5,164 250,000 250,000 250,000
3 11,635 4,128 5,010 5,969 6,077 6,959 7,918 250,000 250,000 250,000
4 15,908 6,107 7,540 9,165 7,850 9,283 10,909 250,000 250,000 250,000
5 20,394 7,978 10,093 12,592 9,516 11,631 14,130 250,000 250,000 250,000
6 25,104 9,740 12,665 16,270 11,073 13,998 17,602 250,000 250,000 250,000
7 30,050 11,378 15,243 20,210 12,505 16,370 21,338 250,000 250,000 250,000
8 35,243 12,877 17,811 24,429 13,799 18,732 25,351 250,000 250,000 250,000
9 40,696 14,230 20,360 28,948 14,947 21,076 29,664 250,000 250,000 250,000
10 46,422 15,418 22,870 33,784 15,929 23,380 34,295 250,000 250,000 250,000
15 79,641 18,413 34,359 63,906 18,413 34,359 63,906 250,000 250,000 250,000
20 122,038 14,244 41,764 108,357 14,244 41,764 108,357 250,000 250,000 250,000
25 176,149 0 39,173 178,304 -2,480 39,173 178,304 250,000 250,000 269,872
30 245,209* 0 80,560 282,714 20,666 80,560 282,714 250,000 250,000 386,956
</TABLE>
- ----------
* After Policy Year 25 premiums are subject to recalculation because the
Guaranteed Premium Period has expired. The amount shown at the end of the
Policy Year 30 in the column entitled "Premiums Accumulated at 5% Interest
Per Year" reflects a premium recalculated based upon a 12% gross annual
return. Assuming a premium recalculated based upon a 0% gross annual return,
the Premiums Accumulated at 5% Interest Per Year at the end of Policy Year
30 would be $318,632, and assuming a premium recalculated based upon a 6%
gross annual return, the Premiums Accumulated at 5% Interest Per Year at the
end of Policy Year 30 would be $309,119.
IT IS EMPHASIZED THAT THE HYPOTHETICAL RESULTS SHOWN ABOVE AND ELSEWHERE IN THIS
PROSPECTUS ARE ILLUSTRATIVE ONLY AND SHOULD NOT BE DEEMED A REPRESENTATION OF
PAST OR FUTURE GROSS ANNUAL RATES OF RETURN. ACTUAL RESULTS MAY BE HIGHER OR
LOWER THAN THOSE SHOWN AND WILL DEPEND ON A NUMBER OF FACTORS, INCLUDING THE
ALLOCATIONS MADE BY A POLICYOWNER, THE FREQUENCY OF THE PREMIUM PAYMENTS MADE BY
A POLICYOWNER, THE INVESTMENT EXPERIENCE OF THE POLICY'S VARIABLE INVESTMENT
OPTIONS, AND THE RATE OF INTEREST PAID ON AMOUNTS HELD IN THE FIXED-RATE OPTION.
THE DEATH BENEFIT, POLICY ACCOUNT VALUE AND NET CASH SURRENDER VALUE FOR A
POLICY WOULD BE DIFFERENT FROM THOSE SHOWN IF THE ACTUAL GROSS ANNUAL RATES OF
RETURN AVERAGED 0%, 6% AND 12% OVER A PERIOD OF YEARS, BUT VARIED ABOVE AND
BELOW THAT AVERAGE DURING THE PERIOD. THEY WOULD ALSO BE DIFFERENT IF ANY POLICY
LOANS OR OTHER POLICY TRANSACTIONS WERE EFFECTED DURING THE PERIOD. NO
REPRESENTATIONS CAN BE MADE BY GIAC OR THE MUTUAL FUNDS THAT THE ILLUSTRATED
HYPOTHETICAL RATES OF RETURN CAN BE ACHIEVED FOR ANY ONE YEAR OR SUSTAINED OVER
ANY PERIOD OF TIME.
THE RECALCULATED BASIC SCHEDULED PREMIUM (ROUNDED TO THE NEAREST DOLLAR) AT AGE
70 WOULD BE $16,170, ASSUMING THE 0% RETURN; $14,636, ASSUMING THE 6% RETURN;
AND $3,515, ASSUMING THE 12% RETURN.
- --------------------------------------------------------------------------------
A-8
<PAGE>
Male Issue Age 45, Non-Smoker, Preferred Underwriting Risk
$250,000 Face Amount
Death Benefit Option 2
These values reflect CURRENT cost of insurance and other charges
<TABLE>
<CAPTION>
Premiums Net Cash Surrender Value Policy Account Value Death Benefit
Accumulated Assuming Hypothetical Gross Assuming Hypothetical Gross Assuming Hypothetical Gross
End of at 5% Annual Return of: Annual Return of: Annual Return of:
Policy Interest --------------------------- --------------------------- ---------------------------
Year Per Year 0% 6% 12% 0% 6% 12% 0% 6% 12%
- ---- -------- --- --- ---- --- --- ---- --- --- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 3,691 246 409 572 2,290 2,452 2,615 250,000 250,000 250,000
2 7,566 2,429 2,989 3,386 4,513 4,982 5,471 250,000 250,000 250,000
3 11,635 4,726 5,647 6,647 6,675 7,596 8,596 250,000 250,000 250,000
4 15,908 7,096 8,621 10,345 8,839 10,365 12,088 250,000 250,000 250,000
5 20,394 9,400 11,687 14,377 10,938 13,225 15,916 250,000 250,000 250,000
6 25,104 11,598 14,808 18,738 12,931 16,140 20,071 250,000 250,000 250,000
7 30,050 13,639 17,933 23,412 14,766 19,060 24,539 250,000 250,000 250,000
8 35,243 15,497 21,036 28,406 16,418 21,958 29,328 250,000 250,000 250,000
9 40,696 17,158 24,104 33,747 17,875 24,820 34,463 250,000 250,000 250,000
10 46,422 18,612 27,122 39,465 19,122 27,633 39,976 250,000 250,000 250,000
15 79,641 24,860 43,711 77,779 24,860 43,711 77,779 250,000 250,000 264,779
20 122,038 28,114 62,299 138,791 28,114 62,299 138,791 250,000 250,000 304,291
25 176,149 26,309 81,963 235,921 26,309 81,963 235,921 250,000 250,000 377,921
30 245,209* 73,392 119,690 388,271 73,392 119,690 388,271 250,000 250,000 531,435
</TABLE>
- ----------
* After Policy Year 25 premiums are subject to recalculation because the
Guaranteed Premium Period has expired. The amount shown at the end of the
Policy Year 30 in the column entitled "Premiums Accumulated at 5% Interest
Per Year" reflects a premium recalculated based upon a 12% gross annual
return. Assuming a premium recalculated based upon a 0% gross annual return,
the Premiums Accumulated at 5% Interest Per Year at the end of Policy Year
30 would be $318,086, and assuming a premium recalculated based upon a 6%
gross annual return, the Premiums Accumulated at 5% Interest Per Year at the
end of Policy Year 30 would be $265,832.
IT IS EMPHASIZED THAT THE HYPOTHETICAL RESULTS SHOWN ABOVE AND ELSEWHERE IN THIS
PROSPECTUS ARE ILLUSTRATIVE ONLY AND SHOULD NOT BE DEEMED A REPRESENTATION OF
PAST OR FUTURE GROSS ANNUAL RATES OF RETURN. ACTUAL RESULTS MAY BE HIGHER OR
LOWER THAN THOSE SHOWN AND WILL DEPEND ON A NUMBER OF FACTORS, INCLUDING THE
ALLOCATIONS MADE BY A POLICYOWNER, THE FREQUENCY OF THE PREMIUM PAYMENTS MADE BY
A POLICYOWNER, THE INVESTMENT EXPERIENCE OF THE POLICY'S VARIABLE INVESTMENT
OPTIONS, AND THE RATE OF INTEREST PAID ON AMOUNTS HELD IN THE FIXED-RATE OPTION.
THE DEATH BENEFIT, POLICY ACCOUNT VALUE AND NET CASH SURRENDER VALUE FOR A
POLICY WOULD BE DIFFERENT FROM THOSE SHOWN IF THE ACTUAL GROSS ANNUAL RATES OF
RETURN AVERAGED 0%, 6% AND 12% OVER A PERIOD OF YEARS, BUT VARIED ABOVE AND
BELOW THAT AVERAGE DURING THE PERIOD. THEY WOULD ALSO BE DIFFERENT IF ANY POLICY
LOANS OR OTHER POLICY TRANSACTIONS WERE EFFECTED DURING THE PERIOD. NO
REPRESENTATIONS CAN BE MADE BY GIAC OR THE MUTUAL FUNDS THAT THE ILLUSTRATED
HYPOTHETICAL RATES OF RETURN CAN BE ACHIEVED FOR ANY ONE YEAR OR SUSTAINED OVER
ANY PERIOD OF TIME.
THE RECALCULATED BASIC SCHEDULED PREMIUM (ROUNDED TO THE NEAREST DOLLAR) AT AGE
70 WOULD BE $16,170, ASSUMING THE 0% RETURN; $7,720, ASSUMING THE 6% RETURN; AND
$3,515, ASSUMING THE 12% RETURN.
- --------------------------------------------------------------------------------
A-9
<PAGE>
Male Issue Age 45, Non-Smoker, Preferred Underwriting Risk
$250,000 Face Amount
Death Benefit Option 2
These values reflect GUARANTEED cost of insurance and other charges
<TABLE>
<CAPTION>
Premiums Net Cash Surrender Value Policy Account Value Death Benefit
Accumulated Assuming Hypothetical Gross Assuming Hypothetical Gross Assuming Hypothetical Gross
End of at 5% Annual Return of: Annual Return of: Annual Return of:
Policy Interest --------------------------- --------------------------- ---------------------------
Year Per Year 0% 6% 12% 0% 6% 12% 0% 6% 12%
- ---- -------- --- --- ---- --- --- ---- --- --- ----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 3,691 238 400 563 2,282 2,444 2,606 250,000 250,000 250,000
2 7,566 2,144 2,602 3,080 4,228 4,686 5,164 250,000 250,000 250,000
3 11,635 4,128 5,010 5,969 6,077 6,959 7,918 250,000 250,000 250,000
4 15,908 6,107 7,540 9,165 7,850 9,283 10,909 250,000 250,000 250,000
5 20,394 7,978 10,093 12,592 9,516 11,631 14,130 250,000 250,000 250,000
6 25,104 9,740 12,665 16,270 11,073 13,998 17,602 250,000 250,000 250,000
7 30,050 11,378 15,243 20,210 12,505 16,370 21,338 250,000 250,000 250,000
8 35,243 12,877 17,811 24,429 13,799 18,732 25,351 250,000 250,000 250,000
9 40,696 14,230 20,360 28,948 14,947 21,076 29,664 250,000 250,000 250,000
10 46,422 15,418 22,870 33,784 15,929 23,380 34,295 250,000 250,000 250,000
15 79,641 18,413 34,359 63,894 18,413 34,359 63,894 250,000 250,000 250,894
20 122,038 14,244 41,764 107,081 14,244 41,764 107,081 250,000 250,000 272,581
25 176,149 0 39,173 169,036 -2,480 39,173 169,036 250,000 250,000 311,036
30 245,209* 20,666 80,560 259,088 20,666 80,560 259,088 250,000 250,000 378,088
</TABLE>
- ----------
* After Policy Year 25 premiums are subject to recalculation because the
Guaranteed Premium Period has expired. The amount shown at the end of the
Policy Year 30 in the column entitled "Premiums Accumulated at 5% Interest
Per Year" reflects a premium recalculated based upon a 12% gross annual
return. Assuming a premium recalculated based upon a 0% gross annual return,
the Premiums Accumulated at 5% Interest Per Year at the end of Policy Year
30 would be $318,632, and assuming a premium recalculated based upon a 6%
gross annual return, the Premiums Accumulated at 5% Interest Per Year at the
end of Policy Year 30 would be $309,119.
IT IS EMPHASIZED THAT THE HYPOTHETICAL RESULTS SHOWN ABOVE AND ELSEWHERE IN THIS
PROSPECTUS ARE ILLUSTRATIVE ONLY AND SHOULD NOT BE DEEMED A REPRESENTATION OF
PAST OR FUTURE GROSS ANNUAL RATES OF RETURN. ACTUAL RESULTS MAY BE HIGHER OR
LOWER THAN THOSE SHOWN AND WILL DEPEND ON A NUMBER OF FACTORS, INCLUDING THE
ALLOCATIONS MADE BY A POLICYOWNER, THE FREQUENCY OF THE PREMIUM PAYMENTS MADE BY
A POLICYOWNER, THE INVESTMENT EXPERIENCE OF THE POLICY'S VARIABLE INVESTMENT
OPTIONS, AND THE RATE OF INTEREST PAID ON AMOUNTS HELD IN THE FIXED-RATE OPTION.
THE DEATH BENEFIT, POLICY ACCOUNT VALUE AND NET CASH SURRENDER VALUE FOR A
POLICY WOULD BE DIFFERENT FROM THOSE SHOWN IF THE ACTUAL GROSS ANNUAL RATES OF
RETURN AVERAGED 0%, 6% AND 12% OVER A PERIOD OF YEARS, BUT VARIED ABOVE AND
BELOW THAT AVERAGE DURING THE PERIOD. THEY WOULD ALSO BE DIFFERENT IF ANY POLICY
LOANS OR OTHER POLICY TRANSACTIONS WERE EFFECTED DURING THE PERIOD. NO
REPRESENTATIONS CAN BE MADE BY GIAC OR THE MUTUAL FUNDS THAT THE ILLUSTRATED
HYPOTHETICAL RATES OF RETURN CAN BE ACHIEVED FOR ANY ONE YEAR OR SUSTAINED OVER
ANY PERIOD OF TIME.
THE RECALCULATED BASIC SCHEDULED PREMIUM (ROUNDED TO THE NEAREST DOLLAR) AT AGE
70 WOULD BE $16,170, ASSUMING THE 0% RETURN; $14,636, ASSUMING THE 6% RETURN;
AND $3,515, ASSUMING THE 12% RETURN.
- --------------------------------------------------------------------------------
A-10
<PAGE>
The following Appendix replaces Appendix A of the Prospectus dated
December 10, 1997 for Park Avenue Life
- --------------------------------------------------------------------------------
A-11
<PAGE>
APPENDIX A
ILLUSTRATIONS OF DEATH BENEFITS, POLICY ACCOUNT VALUES,
NET CASH SURRENDER VALUES AND ACCUMULATED POLICY PREMIUMS
The following tables illustrate how the Policies operate. Specifically,
they show how the death benefit, Net Cash Surrender Value and Policy Account
Value can vary over an extended period of time assuming hypothetical gross rates
of return (i.e., investment income and capital gains and losses, realized or
unrealized) for the Separate Account that are equal to constant after tax annual
rates of 0%, 6% and 12%. The tables are based on policies with Face Amounts of
$250,000 for a male insured at Age 40 and shown in the preferred plus
classification and also in the preferred classification. Values are first given
based on current charges and then based on the policy's higher guaranteed
charges. In addition, each illustration is given first for a policy with an
Option 1 death benefit and then for a policy with an Option 2 death benefit.
These illustrations may assist in the comparison of death benefits, Net Cash
Surrender Values and Policy Account Values for Park Avenue Life policies with
those under other variable life insurance policies which may be issued by GIAC
or other companies. Prospective policyowners are advised, however, that it may
not be advantageous to replace existing life insurance coverage by purchasing a
Park Avenue Life policy, particularly if the decision to replace existing
coverage is based solely on a comparison of policy illustrations.
Death benefits, Net Cash Surrender Values and Policy Account Values will
be different from the amounts shown if: (1) the actual gross rates of return
average 0%, 6% or 12%, but vary above and below the average over the period; and
(2) Policy Premiums are paid at other than annual intervals, or if Unscheduled
Payments are made. Benefits and values will also be affected by the
policyowner's allocation of the Unloaned Policy Account Value among the Variable
Investment Options and the Fixed-Rate Option. If the actual gross rate of return
for all options averages 0%, 6% or 12%, but varies above or below that average
for individual options, allocation and transfer decisions can have a significant
impact on a policy's performance. Policy loans and other policy transactions,
such as skipping Policy Premiums and partial withdrawals, will also affect
results, as will the insured's sex, smoker status and premium class.
Death benefits, Net Cash Surrender Values and Policy Account Values shown
in the tables reflect the fact that: (1) deductions have been made from annual
Policy Premiums for Policy Premium Assessments and Premium Charges; and (2)
Monthly Deductions are deducted from the Policy Account Value on each Monthly
Date. The Net Cash Surrender Values shown in the tables reflect the fact that a
surrender charge is deducted upon surrender, Face Amount reduction or lapse
during the first 12 policy years. The death benefits, Net Cash Surrender Values
and Policy Account Values also reflect a daily charge assessed against the
Separate Account for mortality and expense risks equivalent to an annual charge
of .60% (on a current basis) and .90% (on a guaranteed basis) of the average
daily value of the assets in the Separate Account attributable to the policies.
See "Deductions and Charges." The amounts shown in the illustrations also
reflect an average of the investment advisory fees and operating expenses
incurred by the mutual funds, at an annual rate of 0.87% of the average daily
net assets of such funds.
The average is based upon actual expenses incurred during 1996 for all
funds except that The Guardian Small Cap Stock Fund's expenses have been
estimated since the Fund was not available before 1997. Operating expenses for
the MFS Growth With Income Series, Emerging Growth Series, and Total Return
Series for 1996 were capped at 0.25% of the average daily net assets of the
series and operating expenses for the MFS Bond Series were capped at 0.40% of
the average daily net assets of the series pursuant to the agreement with the
adviser. Operating expenses for the Fidelity VIP III Growth Opportunities
Portfolio reflect the effects of expense reduction arrangements with third
parties which occurred during the year ended December 31, 1996. Operating
expenses for the Fidelity VIP Equity-Income Portfolio reflect the effects of
expense reduction arrangements with third parties which occurred during the year
- --------------------------------------------------------------------------------
A-12
<PAGE>
ended December 31, 1996. The results for the Fidelity Index 500 Portfolio
reflect the effects of expense reimbursement of certain fund expenses which
occurred during the year ended December 31, 1996. In the absence of these
arrangements, operating expenses of the various funds, and the average
investment advisory fees and expenses used in the following illustrations would
have been higher.
Taking account of the charges for mortality and expense risks in the
Separate Account and the average investment advisory fee and operating expenses
of the mutual funds, the gross annual rates of return of 0%, 6% and 12%
correspond to net investment experience at constant annual rates of -1.46%,
4.50% and 10.46%, respectively, based on GIAC's current charge for mortality and
expense risks, and -1.76%, 4.18% and 10.13%, respectively, based on GIAC's
guaranteed maximum charge for mortality and expense risks. See "Net Investment
Factor.".
The hypothetical rates of return shown in the tables do not reflect any
tax charges attributable to the Separate Account since no charges are currently
made. If any such charges are imposed in the future, the gross annual rate of
return would have to exceed the rates shown by an amount sufficient to cover the
tax charges, in order to produce the death benefits, Net Cash Surrender Values
and Policy Account Values illustrated. See "GIAC's Taxes."
The fourth column of each table shows the amount which would accumulate if
an amount equal to the annual Policy Premium was invested to earn interest,
after taxes, of 5% per year, compounded annually. There can be no assurance that
a prospective policyowner would be able to earn this return. During the
Guaranteed Premium Period, the annual Policy Premium is $2,532.50 for the
preferred plus policy illustrated and $3,045 for the preferred policy
illustrated.
GIAC will furnish upon request an illustration reflecting the proposed
insured's Age, sex, premium class and the Face Amount or Basic Scheduled Premium
requested, but a premium-based illustration must reflect GIAC's current minimum
Face Amount requirement for Park Avenue Life -- which is $100,000.
These illustrations will refer to "net outlay" as the cash flow into or
out of the policy. It is equal to the sum of all Policy Premiums and accrued
loan interest paid in cash and reduced by the proceeds of any policy loan or
partial withdrawal received in cash.
From time to time, advertisements or sales literature for Park Avenue Life
may quote historical performance data of one or more of the underlying funds,
and may include cash surrender values and death benefit figures computed using
the same methodology as that used in the following illustrations, but with
average annual total return of the underlying funds for which performance data
is shown in the advertisement or sales literature replacing the hypothetical
rates of return shown in the following tables. This information may be shown in
the form of graphs, charts, tables, and examples. Any such information is
intended to show the policy's investment experience based on the historical
experience of the underlying funds and is not intended to represent what may
happen in the future.
GIAC began to offer Park Avenue Life on December 10, 1997. As such the
policies may not have been available when the funds commenced their operations.
However, illustrations may be based on the actual investment experience of the
funds since their respective inception dates (See "Investment Performance of the
Funds"). The results for any period prior to the policies' being offered would
be calculated as if the policies had been offered during that period of time,
with all charges assumed to be those applicable to the policies. Thus the
illustrations will reflect deductions for each fund's expenses, as well as the
Separate Account's charge for mortality and expense risks, and the charges
deducted from premiums, Monthly Deductions and any transaction deductions
associated with the policy in question.
- --------------------------------------------------------------------------------
A-13
<PAGE>
Male Issue Age 40, Preferred Plus Underwriting Risk
$250,000 Face Amount
Death Benefit Option 1
These values reflect CURRENT cost of insurance and other charges
<TABLE>
<CAPTION>
Assuming Current Assuming Current Assuming Current
Charges and 0% Gross Return Charges and 6% Gross Return Charges and 12% Gross Return
---------------------------- ---------------------------- ----------------------------
Premiums
Accumulated Net Net Net
End of Age at 5% Policy Cash Net Policy Cash Net Policy Cash Net
Policy Beginning Net Interest Account Surrender Death Account Surrender Death Account Surrender Death
Year of Year Outlay Per Year Value Value Benefit Value Value Benefit Value Value Benefit
- ------ ------- ------ -------- ----- ----- ------- ----- ----- ------- ----- ----- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 40 2,533 2,659 1,680 0 250,000 1,800 0 250,000 1,919 0 250,000
2 41 2,533 5,451 3,321 0 250,000 3,665 0 250,000 4,024 138 250,000
3 42 2,533 8,383 4,922 1,389 250,000 5,599 2,066 250,000 6,334 2,801 250,000
4 43 2,533 11,461 6,551 3,371 250,000 7,673 4,493 250,000 8,942 5,762 250,000
5 44 2,533 14,693 8,130 5,303 250,000 9,815 6,689 250,000 11,796 8,970 250,000
6 45 2,533 18,087 9,663 7,189 250,000 12,031 9,558 250,000 14,929 12,456 250,000
7 46 2,533 21,651 11,125 9,005 250,000 14,299 12,179 250,000 18,343 16,223 250,000
8 47 2,533 25,392 12,512 10,746 250,000 16,617 14,850 250,000 22,064 20,297 250,000
9 48 2,533 29,321 13,843 12,430 250,000 19,005 17,592 250,000 26,145 24,731 250,000
10 49 2,533 33,446 15,125 14,065 250,000 21,473 20,413 250,000 30,630 29,570 250,000
15 54 2,533 57,380 20,366 20,366 250,000 34,723 34,723 250,000 60,464 60,464 250,000
20 59 2,533 87,927 23,359 23,359 250,000 49,522 49,522 250,000 108,687 108,687 250,000
25 64 2,533 126,912 23,637 23,637 250,000 65,988 65,988 250,000 187,726 187,726 319,507
30 69 2,533 176,669 19,501 19,501 250,000 83,511 83,511 250,000 312,907 312,907 473,592
</TABLE>
IT IS EMPHASIZED THAT THE HYPOTHETICAL RESULTS SHOWN ABOVE AND ELSEWHERE IN THIS
PROSPECTUS ARE ILLUSTRATIVE ONLY AND SHOULD NOT BE DEEMED A REPRESENTATION OF
PAST OR FUTURE GROSS ANNUAL RATES OF RETURN. ACTUAL RESULTS MAY BE HIGHER OR
LOWER THAN THOSE SHOWN AND WILL DEPEND ON A NUMBER OF FACTORS, INCLUDING THE
ALLOCATIONS MADE BY A POLICYOWNER, THE FREQUENCY OF THE PREMIUM PAYMENTS MADE BY
A POLICYOWNER, THE INVESTMENT EXPERIENCE OF THE POLICY'S VARIABLE INVESTMENT
OPTIONS, AND THE RATE OF INTEREST PAID ON AMOUNTS HELD IN THE FIXED-RATE OPTION.
THE DEATH BENEFIT, POLICY ACCOUNT VALUE AND NET CASH SURRENDER VALUE FOR A
POLICY WOULD BE DIFFERENT FROM THOSE SHOWN IF THE ACTUAL GROSS ANNUAL RATES OF
RETURN AVERAGED 0%, 6% AND 12% OVER A PERIOD OF YEARS, BUT VARIED ABOVE AND
BELOW THAT AVERAGE DURING THE PERIOD. THEY WOULD ALSO BE DIFFERENT IF ANY POLICY
LOANS OR OTHER POLICY TRANSACTIONS WERE EFFECTED DURING THE PERIOD. NO
REPRESENTATIONS CAN BE MADE BY GIAC OR THE MUTUAL FUNDS THAT THE ILLUSTRATED
HYPOTHETICAL RATES OF RETURN CAN BE ACHIEVED FOR ANY ONE YEAR OR SUSTAINED OVER
ANY PERIOD OF TIME.
THE RECALCULATED BASIC SCHEDULED PREMIUM (ROUNDED TO THE NEAREST DOLLAR) AT AGE
70 WOULD BE $16,692, ASSUMING THE 0% RETURN; $6,875, ASSUMING THE 6% RETURN; AND
$2,533, ASSUMING THE 12% RETURN.
- --------------------------------------------------------------------------------
A-14
<PAGE>
Male Issue Age 40, Preferred Plus Underwriting Risk
$250,000 Face Amount
Death Benefit Option 1
These values reflect GUARANTEED cost of insurance and other charges
<TABLE>
<CAPTION>
Assuming Current Assuming Current Assuming Current
Charges and 0% Gross Return Charges and 6% Gross Return Charges and 12% Gross Return
---------------------------- --------------------------- ----------------------------
Premiums
Accumulated Net Net Net
End of Age at 5% Policy Cash Net Policy Cash Net Policy Cash Net
Policy Beginning Net Interest Account Surrender Death Account Surrender Death Account Surrender Death
Year of Year Outlay Per Year Value Value Benefit Value Value Benefit Value Value Benefit
- ------ ------- ------ -------- ----- ----- ------- ----- ----- ------- ----- ----- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 40 2,533 2,659 1,674 0 250,000 1,793 0 250,000 1,913 0 250,000
2 41 2,533 5,451 3,075 0 250,000 3,411 0 250,000 3,761 0 250,000
3 42 2,533 8,383 4,411 878 250,000 5,054 1,521 250,000 5,755 2,221 250,000
4 43 2,533 11,461 5,702 2,522 250,000 6,746 3,566 250,000 7,930 4,750 250,000
5 44 2,533 14,693 6,921 4,094 250,000 8,459 5,632 250,000 10,277 7,451 250,000
6 45 2,533 18,087 8,062 5,589 250,000 10,188 7,715 250,000 12,808 10,334 250,000
7 46 2,533 21,651 9,124 7,004 250,000 11,931 9,811 250,000 15,538 13,418 250,000
8 47 2,533 25,392 10,103 8,336 250,000 13,684 11,917 250,000 18,485 16,719 250,000
9 48 2,533 29,321 10,994 9,581 250,000 15,442 14,029 250,000 21,668 20,255 250,000
10 49 2,533 33,446 11,792 10,732 250,000 17,199 16,139 250,000 25,105 24,045 250,000
15 54 2,533 57,380 14,466 14,466 250,000 26,072 26,072 250,000 47,390 47,390 250,000
20 59 2,533 87,927 13,115 13,115 250,000 33,201 33,201 250,000 80,689 80,689 250,000
25 64 2,533 126,912 4,677 4,677 250,000 35,051 35,051 250,000 131,587 131,587 250,000
30 69 2,533 176,669 -16,689 0 250,000 24,428 24,428 250,000 211,050 211,050 319,430
</TABLE>
IT IS EMPHASIZED THAT THE HYPOTHETICAL RESULTS SHOWN ABOVE AND ELSEWHERE IN THIS
PROSPECTUS ARE ILLUSTRATIVE ONLY AND SHOULD NOT BE DEEMED A REPRESENTATION OF
PAST OR FUTURE GROSS ANNUAL RATES OF RETURN. ACTUAL RESULTS MAY BE HIGHER OR
LOWER THAN THOSE SHOWN AND WILL DEPEND ON A NUMBER OF FACTORS, INCLUDING THE
ALLOCATIONS MADE BY A POLICYOWNER, THE FREQUENCY OF THE PREMIUM PAYMENTS MADE BY
A POLICYOWNER, THE INVESTMENT EXPERIENCE OF THE POLICY'S VARIABLE INVESTMENT
OPTIONS, AND THE RATE OF INTEREST PAID ON AMOUNTS HELD IN THE FIXED-RATE OPTION.
THE DEATH BENEFIT, POLICY ACCOUNT VALUE AND NET CASH SURRENDER VALUE FOR A
POLICY WOULD BE DIFFERENT FROM THOSE SHOWN IF THE ACTUAL GROSS ANNUAL RATES OF
RETURN AVERAGED 0%, 6% AND 12% OVER A PERIOD OF YEARS, BUT VARIED ABOVE AND
BELOW THAT AVERAGE DURING THE PERIOD. THEY WOULD ALSO BE DIFFERENT IF ANY POLICY
LOANS OR OTHER POLICY TRANSACTIONS WERE EFFECTED DURING THE PERIOD. NO
REPRESENTATIONS CAN BE MADE BY GIAC OR THE MUTUAL FUNDS THAT THE ILLUSTRATED
HYPOTHETICAL RATES OF RETURN CAN BE ACHIEVED FOR ANY ONE YEAR OR SUSTAINED OVER
ANY PERIOD OF TIME.
THE RECALCULATED BASIC SCHEDULED PREMIUM (ROUNDED TO THE NEAREST DOLLAR) AT AGE
70 WOULD BE $17,888, ASSUMING THE 0% RETURN; $15,949, ASSUMING THE 6% RETURN;
AND $2,533, ASSUMING THE 12% RETURN.
- --------------------------------------------------------------------------------
A-15
<PAGE>
Male Issue Age 40, Preferred Plus Underwriting Risk
$250,000 Face Amount
Death Benefit Option 2
These values reflect CURRENT cost of insurance and other charges
<TABLE>
<CAPTION>
Assuming Current Assuming Current Assuming Current
Charges and 0% Gross Return Charges and 6% Gross Return Charges and 12% Gross Return
---------------------------- --------------------------- ----------------------------
Premiums
Accumulated Net Net Net
End of Age at 5% Policy Cash Net Policy Cash Net Policy Cash Net
Policy Beginning Net Interest Account Surrender Death Account Surrender Death Account Surrender Death
Year of Year Outlay Per Year Value Value Benefit Value Value Benefit Value Value Benefit
- ------ ------- ------ -------- ----- ----- ------- ----- ----- ------- ----- ----- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 40 2,533 2,659 1,680 0 250,000 1,800 0 250,000 1,919 0 250,000
2 41 2,533 5,451 3,321 0 250,000 3,665 0 250,000 4,024 138 250,000
3 42 2,533 8,383 4,922 1,389 250,000 5,599 2,066 250,000 6,334 2,801 250,000
4 43 2,533 11,461 6,551 3,371 250,000 7,673 4,493 250,000 8,942 5,762 250,000
5 44 2,533 14,693 8,130 5,303 250,000 9,815 6,989 250,000 11,796 8,970 250,000
6 45 2,533 18,087 9,663 7,189 250,000 12,031 9,558 250,000 14,928 12,455 250,000
7 46 2,533 21,651 11,125 9,005 250,000 14,299 12,179 250,000 18,340 16,220 250,000
8 47 2,533 25,392 12,512 10,746 250,000 16,617 14,850 250,000 22,057 20,290 251,037
9 48 2,533 29,321 13,843 12,430 250,000 19,005 17,592 250,000 26,129 24,716 252,352
10 49 2,533 33,446 15,125 14,065 250,000 21,473 20,413 250,000 30,601 29,541 253,946
15 54 2,533 57,380 20,366 20,366 250,000 34,723 34,723 250,000 60,135 60,135 267,505
20 59 2,533 87,927 23,359 23,359 250,000 49,522 49,522 250,000 106,942 106,942 295,284
25 64 2,533 126,912 23,637 23,637 250,000 65,988 65,988 250,000 182,049 182,049 347,509
30 69 2,533 176,669 19,501 19,501 250,000 83,511 83,511 250,000 302,909 302,909 458,460
</TABLE>
IT IS EMPHASIZED THAT THE HYPOTHETICAL RESULTS SHOWN ABOVE AND ELSEWHERE IN THIS
PROSPECTUS ARE ILLUSTRATIVE ONLY AND SHOULD NOT BE DEEMED A REPRESENTATION OF
PAST OR FUTURE GROSS ANNUAL RATES OF RETURN. ACTUAL RESULTS MAY BE HIGHER OR
LOWER THAN THOSE SHOWN AND WILL DEPEND ON A NUMBER OF FACTORS, INCLUDING THE
ALLOCATIONS MADE BY A POLICYOWNER, THE FREQUENCY OF THE PREMIUM PAYMENTS MADE BY
A POLICYOWNER, THE INVESTMENT EXPERIENCE OF THE POLICY'S VARIABLE INVESTMENT
OPTIONS, AND THE RATE OF INTEREST PAID ON AMOUNTS HELD IN THE FIXED-RATE OPTION.
THE DEATH BENEFIT, POLICY ACCOUNT VALUE AND NET CASH SURRENDER VALUE FOR A
POLICY WOULD BE DIFFERENT FROM THOSE SHOWN IF THE ACTUAL GROSS ANNUAL RATES OF
RETURN AVERAGED 0%, 6% AND 12% OVER A PERIOD OF YEARS, BUT VARIED ABOVE AND
BELOW THAT AVERAGE DURING THE PERIOD. THEY WOULD ALSO BE DIFFERENT IF ANY POLICY
LOANS OR OTHER POLICY TRANSACTIONS WERE EFFECTED DURING THE PERIOD. NO
REPRESENTATIONS CAN BE MADE BY GIAC OR THE MUTUAL FUNDS THAT THE ILLUSTRATED
HYPOTHETICAL RATES OF RETURN CAN BE ACHIEVED FOR ANY ONE YEAR OR SUSTAINED OVER
ANY PERIOD OF TIME.
THE RECALCULATED BASIC SCHEDULED PREMIUM (ROUNDED TO THE NEAREST DOLLAR) AT AGE
70 WOULD BE $16,692, ASSUMING THE 0% RETURN; $6,875, ASSUMING THE 6% RETURN; AND
$2,533, ASSUMING THE 12% RETURN.
- --------------------------------------------------------------------------------
A-16
<PAGE>
Male Issue Age 40, Preferred Plus Underwriting Risk
$250,000 Face Amount
Death Benefit Option 2
These values reflect GUARANTEED cost of insurance and other charges
<TABLE>
<CAPTION>
Assuming Current Assuming Current Assuming Current
Charges and 0% Gross Return Charges and 6% Gross Return Charges and 12% Gross Return
--------------------------- --------------------------- ----------------------------
Premiums
Accumulated Net Net Net
End of Age at 5% Policy Cash Net Policy Cash Net Policy Cash Net
Policy Beginning Net Interest Account Surrender Death Account Surrender Death Account Surrender Death
Year of Year Outlay Per Year Value Value Benefit Value Value Benefit Value Value Benefit
- ------ ------- ------ -------- ----- ----- ------- ----- ----- ------- ----- ----- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 40 2,533 2,659 1,674 0 250,000 1,793 0 250,000 1,913 0 250,000
2 41 2,533 5,451 3,075 0 250,000 3,411 0 250,000 3,761 0 250,000
3 42 2,533 8,383 4,411 878 250,000 5,054 1,521 250,000 5,755 2,221 250,000
4 43 2,533 11,461 5,702 2,522 250,000 6,746 3,566 250,000 7,930 4,750 250,000
5 44 2,533 14,693 6,921 4,094 250,000 8,459 5,632 250,000 10,277 7,451 250,000
6 45 2,533 18,087 8,062 5,589 250,000 10,188 7,715 250,000 12,808 10,334 250,000
7 46 2,533 21,651 9,124 7,004 250,000 11,931 9,811 250,000 15,538 13,418 250,000
8 47 2,533 25,392 10,103 8,336 250,000 13,684 11,917 250,000 18,485 16,719 250,000
9 48 2,533 29,321 10,994 9,581 250,000 15,442 14,029 250,000 21,668 20,255 250,000
10 49 2,533 33,446 11,792 10,732 250,000 17,199 16,139 250,000 25,105 24,045 250,000
15 54 2,533 57,380 14,466 14,466 250,000 26,072 26,072 250,000 47,302 47,302 254,672
20 59 2,533 87,927 13,115 13,115 250,000 33,201 33,201 250,000 79,805 79,805 268,148
25 64 2,533 126,912 4,677 4,677 250,000 35,051 35,051 250,000 126,927 126,927 292,387
30 69 2,533 176,669 -16,689 0 250,000 24,428 24,428 250,000 195,635 195,635 333,772
</TABLE>
IT IS EMPHASIZED THAT THE HYPOTHETICAL RESULTS SHOWN ABOVE AND ELSEWHERE IN THIS
PROSPECTUS ARE ILLUSTRATIVE ONLY AND SHOULD NOT BE DEEMED A REPRESENTATION OF
PAST OR FUTURE GROSS ANNUAL RATES OF RETURN. ACTUAL RESULTS MAY BE HIGHER OR
LOWER THAN THOSE SHOWN AND WILL DEPEND ON A NUMBER OF FACTORS, INCLUDING THE
ALLOCATIONS MADE BY A POLICYOWNER, THE FREQUENCY OF THE PREMIUM PAYMENTS MADE BY
A POLICYOWNER, THE INVESTMENT EXPERIENCE OF THE POLICY'S VARIABLE INVESTMENT
OPTIONS, AND THE RATE OF INTEREST PAID ON AMOUNTS HELD IN THE FIXED-RATE OPTION.
THE DEATH BENEFIT, POLICY ACCOUNT VALUE AND NET CASH SURRENDER VALUE FOR A
POLICY WOULD BE DIFFERENT FROM THOSE SHOWN IF THE ACTUAL GROSS ANNUAL RATES OF
RETURN AVERAGED 0%, 6% AND 12% OVER A PERIOD OF YEARS, BUT VARIED ABOVE AND
BELOW THAT AVERAGE DURING THE PERIOD. THEY WOULD ALSO BE DIFFERENT IF ANY POLICY
LOANS OR OTHER POLICY TRANSACTIONS WERE EFFECTED DURING THE PERIOD. NO
REPRESENTATIONS CAN BE MADE BY GIAC OR THE MUTUAL FUNDS THAT THE ILLUSTRATED
HYPOTHETICAL RATES OF RETURN CAN BE ACHIEVED FOR ANY ONE YEAR OR SUSTAINED OVER
ANY PERIOD OF TIME.
THE RECALCULATED BASIC SCHEDULED PREMIUM (ROUNDED TO THE NEAREST DOLLAR) AT AGE
70 WOULD BE $17,888, ASSUMING THE 0% RETURN; $15,949, ASSUMING THE 6% RETURN;
AND $2,533, ASSUMING THE 12% RETURN.
- --------------------------------------------------------------------------------
A-17
<PAGE>
Male Issue Age 40, Preferred Underwriting Risk
$250,000 Face Amount
Death Benefit Option 1
These values reflect CURRENT cost of insurance and other charges
<TABLE>
<CAPTION>
Assuming Current Assuming Current Assuming Current
Charges and 0% Gross Return Charges and 6% Gross Return Charges and 12% Gross Return
--------------------------- --------------------------- ----------------------------
Premiums
Accumulated Net Net Net
End of Age at 5% Policy Cash Net Policy Cash Net Policy Cash Net
Policy Beginning Net Interest Account Surrender Death Account Surrender Death Account Surrender Death
Year of Year Outlay Per Year Value Value Benefit Value Value Benefit Value Value Benefit
- ------ ------- ------ -------- ----- ----- ------- ----- ----- ------- ----- ----- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 40 3,045 3,197 2,039 0 250,000 2,183 0 250,000 2,328 0 250,000
2 41 3,045 6,554 4,014 0 250,000 4,430 0 250,000 4,864 370 250,000
3 42 3,045 10,079 5,926 1,841 250,000 6,743 2,658 250,000 7,631 3,546 250,000
4 43 3,045 13,781 7,848 4,172 250,000 9,202 5,525 250,000 10,731 7,054 250,000
5 44 3,045 17,667 9,653 6,385 250,000 11,680 8,412 250,000 14,065 10,796 250,000
6 45 3,045 21,747 11,362 8,502 250,000 14,202 11,342 250,000 17,681 14,821 250,000
7 46 3,045 26,032 12,995 10,544 250,000 16,788 14,337 250,000 21,629 19,178 250,000
8 47 3,045 30,531 14,554 12,511 250,000 19,443 17,400 250,000 25,948 23,906 250,000
9 48 3,045 35,255 16,039 14,405 250,000 22,170 20,536 250,000 30,680 29,046 250,000
10 49 3,045 40,215 17,459 16,233 250,000 24,982 23,756 250,000 35,878 34,653 250,000
15 54 3,045 68,992 23,192 23,192 250,000 40,084 40,084 250,000 70,594 70,594 250,000
20 59 3,045 105,720 25,377 25,377 250,000 56,112 56,112 250,000 126,517 126,517 250,000
25 64 3,045 152,595 23,070 23,070 250,000 72,741 72,741 250,000 215,898 215,898 367,454
30 69 3,045 212,422 14,755 14,755 250,000 89,755 89,755 250,000 354,671 354,671 536,803
</TABLE>
IT IS EMPHASIZED THAT THE HYPOTHETICAL RESULTS SHOWN ABOVE AND ELSEWHERE IN THIS
PROSPECTUS ARE ILLUSTRATIVE ONLY AND SHOULD NOT BE DEEMED A REPRESENTATION OF
PAST OR FUTURE GROSS ANNUAL RATES OF RETURN. ACTUAL RESULTS MAY BE HIGHER OR
LOWER THAN THOSE SHOWN AND WILL DEPEND ON A NUMBER OF FACTORS, INCLUDING THE
ALLOCATIONS MADE BY A POLICYOWNER, THE FREQUENCY OF THE PREMIUM PAYMENTS MADE BY
A POLICYOWNER, THE INVESTMENT EXPERIENCE OF THE POLICY'S VARIABLE INVESTMENT
OPTIONS, AND THE RATE OF INTEREST PAID ON AMOUNTS HELD IN THE FIXED-RATE OPTION.
THE DEATH BENEFIT, POLICY ACCOUNT VALUE AND NET CASH SURRENDER VALUE FOR A
POLICY WOULD BE DIFFERENT FROM THOSE SHOWN IF THE ACTUAL GROSS ANNUAL RATES OF
RETURN AVERAGED 0%, 6% AND 12% OVER A PERIOD OF YEARS, BUT VARIED ABOVE AND
BELOW THAT AVERAGE DURING THE PERIOD. THEY WOULD ALSO BE DIFFERENT IF ANY POLICY
LOANS OR OTHER POLICY TRANSACTIONS WERE EFFECTED DURING THE PERIOD. NO
REPRESENTATIONS CAN BE MADE BY GIAC OR THE MUTUAL FUNDS THAT THE ILLUSTRATED
HYPOTHETICAL RATES OF RETURN CAN BE ACHIEVED FOR ANY ONE YEAR OR SUSTAINED OVER
ANY PERIOD OF TIME.
THE RECALCULATED BASIC SCHEDULED PREMIUM (ROUNDED TO THE NEAREST DOLLAR) AT AGE
70 WOULD BE $13,675, ASSUMING THE 0% RETURN; $7,472, ASSUMING THE 6% RETURN; AND
$3,045, ASSUMING THE 12% RETURN.
- --------------------------------------------------------------------------------
A-18
<PAGE>
Male Issue Age 40, Preferred Underwriting Risk
$250,000 Face Amount
Death Benefit Option 1
These values reflect GUARANTEED cost of insurance and other charges
<TABLE>
<CAPTION>
Assuming Current Assuming Current Assuming Current
Charges and 0% Gross Return Charges and 6% Gross Return Charges and 12% Gross Return
--------------------------- --------------------------- ----------------------------
Premiums
Accumulated Net Net Net
End of Age at 5% Policy Cash Net Policy Cash Net Policy Cash Net
Policy Beginning Net Interest Account Surrender Death Account Surrender Death Account Surrender Death
Year of Year Outlay Per Year Value Value Benefit Value Value Benefit Value Value Benefit
- ------ ------- ------ -------- ----- ----- ------- ----- ----- ------- ----- ----- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 40 3,045 3,197 2,032 0 250,000 2,176 0 250,000 2,320 0 250,000
2 41 3,045 6,554 3,894 0 250,000 4,305 0 250,000 4,734 240 250,000
3 42 3,045 10,079 5,685 1,599 250,000 6,484 2,398 250,000 7,352 3,267 250,000
4 43 3,045 13,781 7,423 3,746 250,000 8,734 5,058 250,000 10,218 6,541 250,000
5 44 3,045 17,667 9,085 5,816 250,000 11,033 7,765 250,000 13,329 10,060 250,000
6 45 3,045 21,747 10,662 7,802 250,000 13,374 10,514 250,000 16,703 13,843 250,000
7 46 3,045 26,032 12,155 9,704 250,000 15,758 13,307 250,000 20,367 17,916 250,000
8 47 3,045 30,531 13,559 11,516 250,000 18,182 16,140 250,000 24,438 22,306 250,000
9 48 3,045 35,255 14,872 13,237 250,000 20,644 19,010 250,000 28,677 27,043 250,000
10 49 3,045 40,215 16,086 14,860 250,000 23,140 21,914 250,000 33,384 32,158 250,000
15 54 3,045 68,992 20,849 20,849 250,000 36,372 36,372 250,000 64,522 64,522 250,000
20 59 3,045 105,720 21,633 21,633 250,000 49,323 49,323 250,000 113,212 113,212 250,000
25 64 3,045 152,595 15,544 15,544 250,000 59,368 59,368 250,000 189,502 189,502 322,528
30 69 3,045 212,422 -3,074 0 250,000 61,455 61,455 250,000 301,502 301,502 456,331
</TABLE>
IT IS EMPHASIZED THAT THE HYPOTHETICAL RESULTS SHOWN ABOVE AND ELSEWHERE IN THIS
PROSPECTUS ARE ILLUSTRATIVE ONLY AND SHOULD NOT BE DEEMED A REPRESENTATION OF
PAST OR FUTURE GROSS ANNUAL RATES OF RETURN. ACTUAL RESULTS MAY BE HIGHER OR
LOWER THAN THOSE SHOWN AND WILL DEPEND ON A NUMBER OF FACTORS, INCLUDING THE
ALLOCATIONS MADE BY A POLICYOWNER, THE FREQUENCY OF THE PREMIUM PAYMENTS MADE BY
A POLICYOWNER, THE INVESTMENT EXPERIENCE OF THE POLICY'S VARIABLE INVESTMENT
OPTIONS, AND THE RATE OF INTEREST PAID ON AMOUNTS HELD IN THE FIXED-RATE OPTION.
THE DEATH BENEFIT, POLICY ACCOUNT VALUE AND NET CASH SURRENDER VALUE FOR A
POLICY WOULD BE DIFFERENT FROM THOSE SHOWN IF THE ACTUAL GROSS ANNUAL RATES OF
RETURN AVERAGED 0%, 6% AND 12% OVER A PERIOD OF YEARS, BUT VARIED ABOVE AND
BELOW THAT AVERAGE DURING THE PERIOD. THEY WOULD ALSO BE DIFFERENT IF ANY POLICY
LOANS OR OTHER POLICY TRANSACTIONS WERE EFFECTED DURING THE PERIOD. NO
REPRESENTATIONS CAN BE MADE BY GIAC OR THE MUTUAL FUNDS THAT THE ILLUSTRATED
HYPOTHETICAL RATES OF RETURN CAN BE ACHIEVED FOR ANY ONE YEAR OR SUSTAINED OVER
ANY PERIOD OF TIME.
THE RECALCULATED BASIC SCHEDULED PREMIUM (ROUNDED TO THE NEAREST DOLLAR) AT AGE
70 WOULD BE $13,675, ASSUMING THE 0% RETURN; $11,704, ASSUMING THE 6% RETURN;
AND $3,045, ASSUMING THE 12% RETURN.
- --------------------------------------------------------------------------------
A-19
<PAGE>
Male Issue Age 40, Preferred Underwriting Risk
$250,000 Face Amount
Death Benefit Option 2
These values reflect CURRENT cost of insurance and other charges
<TABLE>
<CAPTION>
Assuming Current Assuming Current Assuming Current
Charges and 0% Gross Return Charges and 6% Gross Return Charges and 12% Gross Return
--------------------------- --------------------------- ----------------------------
Premiums
Accumulated Net Net Net
End of Age at 5% Policy Cash Net Policy Cash Net Policy Cash Net
Policy Beginning Net Interest Account Surrender Death Account Surrender Death Account Surrender Death
Year of Year Outlay Per Year Value Value Benefit Value Value Benefit Value Value Benefit
- ------ ------- ------ -------- ----- ----- ------- ----- ----- ------- ----- ----- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 40 3,045 3,197 2,039 0 250,000 2,183 0 250,000 2,328 0 250,000
2 41 3,045 6,554 4,013 0 250,000 4,429 0 250,000 4,863 369 250,000
3 42 3,045 10,079 5,926 1,840 250,000 6,743 2,657 250,000 7,630 3544 250,000
4 43 3,045 13,781 7,848 4,171 250,000 9,201 5,524 250,000 10,729 7052 250,000
5 44 3,045 17,667 9,653 6,384 250,000 11,679 8,411 250,000 14,060 10792 250,000
6 45 3,045 21,747 11,362 8,502 250,000 14,201 11,341 250,000 17,671 14811 250,279
7 46 3,045 26,032 12,995 10,544 250,000 16,787 14,336 250,000 21,611 19160 251,341
8 47 3,045 30,531 14,553 12,511 250,000 19,442 17,399 250,000 25,915 23872 252,662
9 48 3,045 35,255 16,039 14,405 250,000 22,169 20,535 250,000 30,624 28989 254,281
10 49 3,045 40,215 17,458 16,233 250,000 24,981 23,755 250,000 35,787 34561 256,227
15 54 3,045 68,992 23,192 23,192 250,000 40,083 40,083 250,000 69,918 69918 272,493
20 59 3,045 105,720 25,377 25,377 250,000 56,111 56,111 250,000 123,165 123,165 305,275
25 64 3,045 152,595 23,070 23,070 250,000 72,739 72,739 250,000 207,503 207,503 366,036
30 69 3,045 212,422 14,755 14,755 250,000 89,752 89,752 250,000 341,441 341,441 516,779
</TABLE>
IT IS EMPHASIZED THAT THE HYPOTHETICAL RESULTS SHOWN ABOVE AND ELSEWHERE IN THIS
PROSPECTUS ARE ILLUSTRATIVE ONLY AND SHOULD NOT BE DEEMED A REPRESENTATION OF
PAST OR FUTURE GROSS ANNUAL RATES OF RETURN. ACTUAL RESULTS MAY BE HIGHER OR
LOWER THAN THOSE SHOWN AND WILL DEPEND ON A NUMBER OF FACTORS, INCLUDING THE
ALLOCATIONS MADE BY A POLICYOWNER, THE FREQUENCY OF THE PREMIUM PAYMENTS MADE BY
A POLICYOWNER, THE INVESTMENT EXPERIENCE OF THE POLICY'S VARIABLE INVESTMENT
OPTIONS, AND THE RATE OF INTEREST PAID ON AMOUNTS HELD IN THE FIXED-RATE OPTION.
THE DEATH BENEFIT, POLICY ACCOUNT VALUE AND NET CASH SURRENDER VALUE FOR A
POLICY WOULD BE DIFFERENT FROM THOSE SHOWN IF THE ACTUAL GROSS ANNUAL RATES OF
RETURN AVERAGED 0%, 6% AND 12% OVER A PERIOD OF YEARS, BUT VARIED ABOVE AND
BELOW THAT AVERAGE DURING THE PERIOD. THEY WOULD ALSO BE DIFFERENT IF ANY POLICY
LOANS OR OTHER POLICY TRANSACTIONS WERE EFFECTED DURING THE PERIOD. NO
REPRESENTATIONS CAN BE MADE BY GIAC OR THE MUTUAL FUNDS THAT THE ILLUSTRATED
HYPOTHETICAL RATES OF RETURN CAN BE ACHIEVED FOR ANY ONE YEAR OR SUSTAINED OVER
ANY PERIOD OF TIME.
THE RECALCULATED BASIC SCHEDULED PREMIUM (ROUNDED TO THE NEAREST DOLLAR) AT AGE
70 WOULD BE $13,675, ASSUMING THE 0% RETURN; $7,473, ASSUMING THE 6% RETURN; AND
$3,045, ASSUMING THE 12% RETURN.
- --------------------------------------------------------------------------------
A-20
<PAGE>
Male Issue Age 40, Preferred Underwriting Risk
$250,000 Face Amount
Death Benefit Option 2
These values reflect GUARANTEED cost of insurance and other charges
<TABLE>
<CAPTION>
Assuming Current Assuming Current Assuming Current
Charges and 0% Gross Return Charges and 6% Gross Return Charges and 12% Gross Return
--------------------------- --------------------------- ----------------------------
Premiums
Accumulated Net Net Net
End of Age at 5% Policy Cash Net Policy Cash Net Policy Cash Net
Policy Beginning Net Interest Account Surrender Death Account Surrender Death Account Surrender Death
Year of Year Outlay Per Year Value Value Benefit Value Value Benefit Value Value Benefit
- ------ ------- ------ -------- ----- ----- ------- ----- ----- ------- ----- ----- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1 40 3,045 3,197 2,032 0 250,000 2,175 0 250,000 2,319 0 250,000
2 41 3,045 6,554 3,894 0 250,000 4,304 0 250,000 4,733 239 250,000
3 42 3,045 10,079 5,684 1,599 250,000 6,483 2,398 250,000 7,351 3,266 250,000
4 43 3,045 13,781 7,423 3,746 250,000 8,734 5,057 250,000 10,216 6,539 250,000
5 44 3,045 17,667 9,084 5,816 250,000 11,032 7,764 250,000 13,326 10,057 250,000
6 45 3,045 21,747 10,662 7,802 250,000 13,373 10,514 250,000 16,698 13,838 250,000
7 46 3,045 26,032 12,155 9,703 250,000 15,757 13,306 250,000 20,357 17,906 250,087
8 47 3,045 30,531 13,559 11,516 250,000 18,182 16,139 250,000 24,329 22,286 251,076
9 48 3,045 35,255 14,871 13,237 250,000 20,644 19,010 250,000 28,641 27,007 252,298
10 49 3,045 40,215 16,085 14,860 250,000 23,139 21,913 250,000 33,322 32,097 253,762
15 54 3,045 68,992 20,848 20,848 250,000 36,371 36,371 250,000 64,010 64,010 266,585
20 59 3,045 105,720 21,633 21,633 250,000 49,322 49,322 250,000 110,511 110,511 292,621
25 64 3,045 152,595 15,544 15,544 250,000 59,367 59,367 250,000 180,626 180,626 339,158
30 69 3,045 212,422 -3,074 0 250,000 61,453 61,453 250,000 286,634 286,634 433,827
</TABLE>
IT IS EMPHASIZED THAT THE HYPOTHETICAL RESULTS SHOWN ABOVE AND ELSEWHERE IN THIS
PROSPECTUS ARE ILLUSTRATIVE ONLY AND SHOULD NOT BE DEEMED A REPRESENTATION OF
PAST OR FUTURE GROSS ANNUAL RATES OF RETURN. ACTUAL RESULTS MAY BE HIGHER OR
LOWER THAN THOSE SHOWN AND WILL DEPEND ON A NUMBER OF FACTORS, INCLUDING THE
ALLOCATIONS MADE BY A POLICYOWNER, THE FREQUENCY OF THE PREMIUM PAYMENTS MADE BY
A POLICYOWNER, THE INVESTMENT EXPERIENCE OF THE POLICY'S VARIABLE INVESTMENT
OPTIONS, AND THE RATE OF INTEREST PAID ON AMOUNTS HELD IN THE FIXED-RATE OPTION.
THE DEATH BENEFIT, POLICY ACCOUNT VALUE AND NET CASH SURRENDER VALUE FOR A
POLICY WOULD BE DIFFERENT FROM THOSE SHOWN IF THE ACTUAL GROSS ANNUAL RATES OF
RETURN AVERAGED 0%, 6% AND 12% OVER A PERIOD OF YEARS, BUT VARIED ABOVE AND
BELOW THAT AVERAGE DURING THE PERIOD. THEY WOULD ALSO BE DIFFERENT IF ANY POLICY
LOANS OR OTHER POLICY TRANSACTIONS WERE EFFECTED DURING THE PERIOD. NO
REPRESENTATIONS CAN BE MADE BY GIAC OR THE MUTUAL FUNDS THAT THE ILLUSTRATED
HYPOTHETICAL RATES OF RETURN CAN BE ACHIEVED FOR ANY ONE YEAR OR SUSTAINED OVER
ANY PERIOD OF TIME.
THE RECALCULATED BASIC SCHEDULED PREMIUM (ROUNDED TO THE NEAREST DOLLAR) AT AGE
70 WOULD BE $13,675, ASSUMING THE 0% RETURN; $11,704, ASSUMING THE 6% RETURN;
AND $3,045, ASSUMING THE 12% RETURN.
- --------------------------------------------------------------------------------
A-21
