AUSA SERIES LIFE ACCOUNT
497, 2001-01-19
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                 Supplement Dated January 19, 2001 to Prospectus
             Dated May 1, 2000 as Supplemented September 1, 2000 for
                         AUSA FINANCIAL FREEDOM BUILDER
          An Individual Flexible Premium Variable Life Insurance Policy
                                    ISSUED BY
                        AUSA Life Insurance Company, Inc.
                                     AND ITS
                            AUSA Series Life Account

THIS SUPPLEMENT PROVIDES ADDITIONAL INFORMATION TO THE INFORMATION IN THE MAY 1,
2000 PROSPECTUS. PLEASE READ IT CAREFULLY AND KEEP IT WITH YOUR MAY 1, 2000
PROSPECTUS FOR FUTURE REFERENCE.

An owner of certain fixed life insurance policies and certificates issued by us
and certain of our affiliates (the "Companies") may be entitled to purchase the
AUSA Financial Freedom Builder in connection with the settlement of litigation
against the Companies and under the terms of the settlement agreement. We call
the AUSA Financial Freedom Builder Policy that is purchased under these terms an
"Enhanced Value Life Insurance Policy."

Applicants for an Enhanced Value Life Insurance Policy must be under age 80 and
meet our standard underwriting requirements. The death benefit of the Enhanced
Value Life Insurance Policy can be no more than the greater of $50,000 or the
original face amount of the policy making an applicant eligible for relief under
the settlement agreement, not to exceed $1,000,000.

Bankers United Life Assurance Company, one of the Companies, will issue two
premium voucher credits to each qualified applicant ("you") in the amount
determined under the terms of the settlement agreement. You may apply the
premium voucher credits toward the purchase of an Enhanced Value Life Insurance
Policy, provided you satisfy our underwriting requirements. In order to receive
the benefit of the first premium voucher credit, you must submit the first
premium voucher to us no later than the first Policy anniversary of the Enhanced
Value Life Insurance Policy issued to you. We will credit the first premium
voucher credit to your Enhanced Value Life Insurance Policy on the first Policy
anniversary, and we will allocate the amount of that premium voucher credit in
accordance with your then current premium allocation schedule, unless you
instruct us otherwise.

Similarly in order to receive the benefit of the second premium voucher credit,
you must submit the second premium voucher to us no later than the second Policy
anniversary of the Enhanced Value Life Insurance Policy issued to you. We will
credit the second premium voucher credit to your Enhanced Value Life Insurance
Policy on the second Policy anniversary, and we will allocate the amount of that
premium voucher credit in accordance with your then current premium allocation
schedule, unless you instruct us otherwise.

Premium voucher credits expire five years after the date they are issued.
Premium voucher credits may be transferred to a person or entity in your
immediate family (generally, your spouse, child, stepchild or parent) or any
person in whom you have an insurable interest. Premium


<PAGE>

voucher credits may not be redeemed for cash. Premium voucher credits may not be
aggregated; only one pair of vouchers may be applied toward the premiums of a
single Enhanced Value Life Insurance Policy.

Premiums paid for the Enhanced Value Life Insurance Policy, other than the
premiums paid using the premium voucher credits, must be paid from a source
other than a surrender of, policy loan against, or withdrawal of values from, an
existing insurance product issued by any of the Companies.

The premium voucher credits will vest immediately, become part of the Enhanced
Value Life Insurance Policy's cash value, and are not subject to refund or
revocation by us.

IF YOU ARE A PERSON WHO MAY BE ENTITLED TO PURCHASE AN ENHANCED VALUE LIFE
INSURANCE POLICY UNDER THE TERMS OF THE SETTLEMENT AGREEMENT, YOU SHOULD CALL
THE BANKERS UNITED CLASS ACTION INFORMATION LINE AT 800-572-0153 FOR ADDITIONAL
INFORMATION.

THIS SUPPLEMENT DOES NOT PROVIDE TAX ADVICE. PURCHASING AN ENHANCED VALUE LIFE
INSURANCE POLICY MAY HAVE TAX CONSEQUENCES. YOU SHOULD CONSULT WITH YOUR TAX
ADVISER PRIOR TO PURCHASING AN ENHANCED VALUE LIFE INSURANCE POLICY.


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