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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-4
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 X
Pre-Effective Amendment No. (File No. 33-57731)
Post-Effective Amendment No. 1
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT
OF 1940 X
Amendment No. 2 (File No. 812-9484)
APL VARIABLE ANNUITY ACCOUNT 1
___________________________________________________________________
(Exact Name of Registrant)
American Partners Life Insurance Company
___________________________________________________________________
(Name of Depositor)
80 South 8th Street, P.O. Box 534, Minneapolis, MN 55440-0534
(Address of Depositor's Principal Executive Offices) (Zip Code)
Depositor's Telephone Number, including Area Code (612)
Mary Ellyn Minenko, IDS Tower 10, Minneapolis, MN 55440-0010
(Name and Address of Agent for Service)
Approximate Date of Proposed Public Offering
It is proposed that this filing will become effective (check
appropriate box)
immediately upon filing pursuant to paragraph (b) of Rule 485
X on October 31, 1995 pursuant to paragraph (b) of Rule 485
60 days after filing pursuant to paragraph (a)(i) of Rule 485
on (date) pursuant to paragraph (a)(i) of Rule 485
If appropriate, check the following box:
this post-effective amendment designates a new effective date
for a previously filed post-effective amendment.
Calculation of Registration Fee Under the Securities Act of 1933
DECLARATION REQUIRED BY RULE 24f-2(a)(1)
The Registrant has registered an indefinite number or amount of
securities under the Securities Act of 1933 pursuant to Section
24-f of the Investment Company Act of 1940.
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<TABLE>
<CAPTION>
CROSS REFERENCE SHEET
Cross reference sheet showing location in the prospectus and Statement of Additional
Information of the information called for by the items enumerated in Part A and B of Form N-4.
Negative answers omitted from prospectus and Statement of Additional Information are so indicated.
PART A PART B
Section in
Section Statement of
Item No. in Prospectus Item No. Additional Information
<C> <C> <C> <C>
1 Cover page 15 Cover page
2 Key terms 16 Table of contents
3(a) Expense summary 17(a) Depositor
(b) The Annuity in brief (b) NA
(c) About American Partners Life*
4(a) Condensed financial
information 18(a) NA
(b) Performance information (b) NA
(c) Financial statements (c) Independent auditors
(d) NA
5(a) Cover page; About (e) NA
American Partners Life (f) NA
(b) The variable account
(c) The funds 19(a) Distribution of the contracts*
(d) Cover page; The funds About American Partners Life*
(e) Voting rights (b) NA
(f) NA
20(a) Principal underwriter
6(a) Charges (b) Principal underwriter
(b) Charges (c) NA
(c) Charges (d) NA
(d) NA
(e) The funds 21(a) Performance information
(f) NA (b) Performance information
7(a) Buying your annuity; 22 Calculating Annuity Payouts
Benefits in case of
death; 23(a) Financial Statements
The annuity payout (b) Financial Statements
period
(b) The variable account;
Making the most of your
annuity
(c) The funds; Charges
(d) Cover page
8(a) The annuity payout period
(b) Buying the annuity
(c) The annuity payout period
(d) The annuity payout period
(e) The annuity payout period
(f) The annuity payout period
9(a) Benefits in case of death
(b) Benefits in case of death
10(a) Buying your annuity;
Valuing your investment
(b) Valuing your investment
(c) Buying your annuity; Valuing
your investment
(d) About American Partners Life
11(a) Surrendering your contract
(b) NA
(c) Surrendering your contract
(d) Buying your annuity
(e) The annuity in brief
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12(a) Taxes
(b) Key terms
(c) NA
13 NA
14 Table of contents of the
Statement of Additional Information
*Designates section in the prospectus, which is hereby incorporated by reference
in this Statement of Additional Information.
</TABLE>
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Privileged Assets (registered trademark symbol) Select Annuity
Prospectus/Oct. 31, 1995
The Privileged Assets (registered trademark symbol) Select Annuity
is a flexible premium deferred fixed/variable annuity contract
offered by American Partners Life Insurance Company (American
Partners Life), a subsidiary of IDS Life Insurance Company (IDS
Life), which is a subsidiary of American Express Financial
Corporation. Purchase payments may be allocated among different
accounts, providing variable and/or fixed returns. Through the
subaccounts of the variable account, you can invest in mutual funds
that are managed to meet a variety of investment objectives. The
contract value will vary according to the investment performance of
the funds you select. You bear the entire investment risk under
the contract.
The annuity is available for non-qualified and certain qualified
retirement plans. The annuity offers tax-deferred asset
accumulation. This may be particularly attractive to investors in
high federal and state tax brackets who have made maximum
contributions to employer-sponsored retirement programs and IRAs.
The annuity has no front-end sales charge, nor does it have a
redemption or surrender charge.
The Privileged Assets Select Annuity is designed to allow you to
build up funds for retirement. When you need to access your money,
such as at retirement, you may do so in several ways including the
following: you may take a monthly fixed annuity payout for the
lifetime of the annuitant(s) you have designated, or you may take a
lump-sum, a fixed amount per month on the earnings on the annuity.
APL Variable Annuity Account 1
Sold by: American Partners Life Insurance Company.
Service Office: 80 South Eighth Street, P.O. Box 59197,
Minneapolis, MN 55459-0197.
Telephone: 1-800-AXP-SERV. (toll free)
(1-800-297-7378)
THIS PROSPECTUS CONTAINS THE INFORMATION ABOUT THE VARIABLE
ACCOUNTS THAT YOU SHOULD KNOW BEFORE INVESTING. Refer to "The
variable accounts" in this prospectus.
THE PROSPECTUS IS ACCOMPANIED OR PRECEDED BY THE FOLLOWING
PROSPECTUSES: THE RETIREMENT ANNUITY MUTUAL FUND PROSPECTUS
(DESCRIBING IDS LIFE AGGRESSIVE GROWTH FUND, IDS LIFE INTERNATIONAL
EQUITY FUND, IDS LIFE CAPITAL RESOURCE FUND, IDS LIFE MANAGED FUND,
INC., IDS LIFE SPECIAL INCOME FUND, INC. AND IDS LIFE MONEYSHARE
FUND, INC.) AND THE INVESCO VARIABLE INVESTMENT FUNDS, INC.
PROSPECTUS (DESCRIBING INVESCO VIF-INDUSTRIAL INCOME PORTFOLIO).
PLEASE KEEP THESE PROSPECTUSES FOR FUTURE REFERENCE.
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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION, OR ANY STATE SECURITIES
COMMISSION, NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR
ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.
AMERICAN PARTNERS LIFE IS NOT A FINANCIAL INSTITUTION, AND THE
SECURITIES IT OFFERS ARE NOT DEPOSITS OR OBLIGATIONS OF, OR
GUARANTEED OR ENDORSED BY ANY FINANCIAL INSTITUTION NOR ARE THEY
INSURED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION, THE FEDERAL
RESERVE BOARD OR ANY OTHER AGENCY.
A Statement of Additional Information (SAI) dated Oct. 31, 1995
(incorporated by reference into this prospectus) has been filed
with the Securities and Exchange Commission (SEC), and is available
without charge by contacting American Partners Life at the
telephone number above or by completing and sending the order form
on the last page of this prospectus. The table of contents of the
SAI is on the last page of this prospectus.
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Contents
Key terms.....................................................
The Privileged Assets (registered trademark symbol) Select
Annuity in brief..............................................
Expense summary...............................................
Financial statements..........................................
Performance information.......................................
The variable account..........................................
The funds.....................................................
IDS Life Aggressive Growth Fund..........................
IDS Life International Equity Fund.......................
IDS Life Capital Resource Fund...........................
IDS Life Managed Fund....................................
IDS Life Special Income Fund.............................
IDS Life Moneyshare Fund.................................
INVESCO VIF-Industrial Income Portfolio..................
The fixed account.............................................
Buying your annuity...........................................
Setting the annuity start date...........................
Beneficiary..............................................
Minimum purchase payments................................
Three ways to make purchase payments.....................
Charges.......................................................
Contract administrative charge...........................
Mortality and expense risk fee...........................
Premium taxes............................................
Other information on charges.............................
Valuing your investment.......................................
Number of units..........................................
Accumulation unit value..................................
Net investment factor....................................
Factors that affect variable account
accumulation units....................................
Making the most of your annuity...............................
Automated dollar-cost averaging..........................
Transferring money between accounts......................
Transfer policies........................................
Three ways to request a transfer or a surrender..........
Surrendering your contract....................................
Surrender policies.......................................
Receiving payment when you request a surrender...........
Changing ownership............................................
Benefits in case of death.....................................
The annuity payout period.....................................
Annuity payout plans.....................................
Death after annuity payouts begin........................
Taxes.........................................................
Voting rights.................................................
Substitution of investments...................................
Distribution of the contracts.................................
About American Partners Life..................................
Regular and special reports...................................
Table of contents of the Statement of Additional
Information................................................
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Key terms
These terms can help you understand details about your annuity.
American Partners Life - In this prospectus, "we," "us," "our" and
"American Partners Life" refer to American Partners Life Insurance
Company.
Annuity - A contract purchased from an insurance company that
offers tax-deferred growth of the contract owner's investment until
earnings are withdrawn, and that can be tailored to meet the
specific needs of the individual during retirement.
Accumulation unit - A measure of the value of each variable
subaccount before annuity payouts begin.
Annuitant - The person on whose life or life expectancy the payouts
are based.
Annuity payout - An amount paid at regular intervals under one of
several plans available to the owner and/or any other payee. This
amount is paid on a fixed basis.
Annuity start date - The date when annuity payouts are scheduled to
begin. This date is established when you start your contract. As
your financial goals change, you may change the annuity start date.
Beneficiary - The person designated to receive annuity benefits in
case of the owner's or annuitant's death.
Close of business - When the New York Stock Exchange (NYSE) closes,
normally 3 p.m. Central time.
Code - Internal Revenue Code of 1986, as amended.
Contract value - Your total purchase payments, plus investment
return, less any contract administrative charges, premium tax
charges and prior withdrawals.
Contract year - A period of 12 months, starting on the effective
date of your contract and on each anniversary of the effective
date.
Fixed account - An account to which you may allocate purchase
payments. Amounts allocated to this account earn interest at rates
that are declared periodically by American Partners Life.
Mutual funds (funds) - Mutual funds or portfolios, each with a
different investment objective. (See "The funds.") You may
allocate your purchase payments into variable subaccounts investing
in shares of any or all of these funds.
Owner (you, your) - The person who controls the annuity (decides on
investment allocations, transfers, payout options, etc.) Usually,
but not always, the owner is also the annuitant. The owner is
responsible for taxes, regardless of whether he or she receives the
annuity's benefits.
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Purchase payments - Payments made to American Partners Life for an
annuity.
Qualified annuity - An annuity purchased for a retirement plan
that is subject to applicable federal law and any rules of the plan
itself. These plans include:
o Individual Retirement Annuities (IRAs), including rollovers from
qualified plans
o Simplified Employee Pension (SEP) Plans
All other annuities are considered nonqualified annuities.
Surrender value - The amount you are entitled to receive if you
surrender your annuity. It is the contract value minus any
applicable state premium taxes. No surrender charge will apply.
Valuation date - Any normal business day, Monday through Friday,
that the NYSE is open. The value of each variable subaccount is
calculated at the close of business on each valuation date.
Variable account - An account consisting of separate subaccounts to
which you may allocate purchase payments; each invests in shares of
one mutual fund. (See "The variable account.") The value of your
investment in each variable subaccount changes with the performance
of the particular fund.
The Privileged Assets (registered trademark symbol) Select Annuity
in brief
Purpose: The Privileged Assets (registered trademark symbol)
Select Annuity is designed to allow you to build up funds for
retirement. You do this by making one or more investments
(purchase payments) that may earn returns that increase the value
of the annuity. Beginning at a specified future date (the annuity
start date), the annuity provides lifetime or other forms of
payouts to you or to anyone you designate.
Accounts: You may allocate your purchase payments among any or all
of:
o variable subaccounts, each of which invests in a mutual fund
with a particular investment objective. The value of each
variable subaccount varies with the performance of the
particular fund. Therefore, the contract value at the annuity
start date may be more or less than the total of purchase
payments allocated to the variable subaccounts. (p.)
o a fixed account, which earns interest at rates that are declared
periodically by American Partners Life. The guaranteed minimum
interest rate is 3%. (p.)
Buying the annuity: You can purchase an annuity contract by
submitting a complete application. Applications are subject to
acceptance at our service office. You may buy a nonqualified
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PAGE 9
annuity or a qualified annuity. Payment may be made either in a
lump sum with the option of additional payments in the future or
installments:
o Minimum purchase payment - $2,000 ($1,000 for qualified
annuities) unless you pay in installments by means of a bank
authorization or under a group billing arrangement at a rate of
$100/month or more or other payment plan acceptable to us.
o Minimum additional payment - $100.
o Maximum first-year payment(s) - $50,000 to $1,000,000 depending
on your age.
o Maximum payment for each subsequent year - $50,000. (p.)
Ten-day free look: You may return your contract for a refund
within 10 days after you receive it. The portion of your first
purchase payment allocated to the variable account must be invested
initially in the IDS Life Moneyshare subaccount for the period we
estimate or calculate your free look right to be in existence
(generally 15 days after the contract date or 25 days if you are
replacing an existing annuity).
If you choose not to keep your contract, return it to us within the
free look period. The contract will be canceled and we will refund
promptly the greater of (1) your purchase payment without
investment earnings, or (2) your contract value plus any amount
deducted from your payment prior to allocation to the variable
account or the fixed account.
Transfers: Subject to certain restrictions you may re-allocate
your money among accounts without charge at any time until annuity
payouts begin. You may establish automated transfers among the
fixed account and variable subaccount(s) and you may request a
transfer by telephone. (p.)
Surrenders: You may surrender all or part of your contract value at
any time before the annuity start date. You also may establish
systematic surrenders. There is no surrender charge. Amounts you
surrender may be taxable (and include a 10% penalty if surrenders
are made prior to your reaching age 59 1/2); and have other tax
consequences; also, certain restrictions apply. (p.)
Changing ownership: You may change ownership of a nonqualified
annuity by written instruction. However, such changes of
nonqualified annuities may have federal income tax consequences.
Certain restrictions apply concerning change of ownership of a
qualified annuity. (p.)
Payment in case of death: If you or the annuitant dies before
annuity payouts begin, we will pay the beneficiary the greater of
the contract value or total purchase payments made less partial
surrenders. (p.)
Annuity payouts: The contract value of your investment can be
applied to an annuity payout plan that begins on the annuity start
date. You may choose from a variety of plans to make sure that
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PAGE 10
payouts continue as long as they are needed. If you purchased a
qualified annuity, the payout schedule must meet requirements of
the qualified plan. Payouts will be made on a fixed basis. (p.)
Taxes: Generally, your annuity grows tax-deferred until you
surrender it or begin to receive payouts. (Under certain
circumstances, IRS penalty taxes may apply.) Even if you direct
payouts to someone else, you will still be taxed on the income if
you are the owner. (p.)
Charges: Your Privileged Assets Select Annuity is subject to a $30
annual contract administrative charge, a 1% mortality and expense
risk charge against the variable subaccounts, and any premium taxes
that may be imposed by state or local governments. Premium taxes
are deducted either from your purchase payments, upon full
surrender or when annuity payments begin. (p.)
Expense summary
The purpose of this summary is to help you understand the various
costs and expenses associated with the Privileged Assets Select
Annuity.
You pay no sales charge when you purchase the Privileged Assets
Select Annuity nor do you pay a surrender charge if you surrender
your annuity. All costs that you bear directly or indirectly for
the variable subaccounts and underlying mutual funds are shown
below. Some expenses may vary as explained under "Contract
charges."
Direct charge. This charge is deducted directly from the contract
value.
Annual contract administrative charge: $30. If the total purchase
payments (less partial surrenders) is at least $10,000, we will
waive the charge.
Indirect charges. The variable account pays these expenses out of
its assets. They are reflected in the variable subaccounts' daily
accumulation unit value and are not charged directly to your
account. They include:
Mortality and expense risk fee: 1% per year, deducted from the
variable subaccounts as a percentage of the average daily net
assets of the underlying fund.
Operating expenses of underlying mutual funds: management fees and
other expenses deducted as a percentage of average net assets as
follows: *
<TABLE>
<CAPTION>
IDS Life IDS Life IDS Life IDS Life
Aggressive International Capital IDS Life Special IDS Life
Growth Equity Resource Managed Income Moneyshare
<S> <C> <C> <C> <C> <C> <C>
Management fees .64% .89% .64% .64% .64% .54%
Other expenses .04 .16 .04 .04 .04 .02
Total** .68% 1.05% .68% .68% .68% .56%
</TABLE>
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INVESCO VIF
Industrial
Income
Management fees .75%
Other expenses .15
Total** .90%
* Premium taxes imposed by some state and local governments are not
reflected in this table.
** Annualized operating expenses of underlying mutual funds for the
year ended Dec. 31, 1994. The figures given above reflect the
amounts actually deducted during 1994, except for three funds. The
INVESCO VIF - Industrial Income Portfolio commenced investment
operations on Aug. 10, 1994, and therefore the expenses for this
Portfolio are annualized. As of the date of this prospectus,
certain fees are being waived or expenses are being assumed by the
respective investment managers or service providers for certain of
the underlying mutual funds, in each case on a voluntary basis.
Without such waivers or reimbursements, the Total Portfolio Annual
Expenses that would have been incurred for the last completed
fiscal year would be: 32.55% for the INVESCO VIF - Industrial
Income Portfolio. See the Portfolios' prospectus for a discussion
of fee waiver and expense reimbursements.
Example:* You would pay the following expenses on a $1,000
investment, assuming 5% annual return and surrender, no surrender
or selection of an annuity payout plan at the end of each time
period:
<TABLE><CAPTION>
IDS Life IDS Life IDS Life IDS Life
Aggressive International Capital IDS Life Special IDS Life
Growth Equity Resource Managed Income Moneyshare
<S> <C> <C> <C> <C> <C> <C>
1 year $ 20.15 $ 23.94 $ 20.15 $ 20.15 $ 20.15 $ 18.92
3 years 62.28 73.72 62.28 62.28 62.28 58.55
5 years 106.95 126.12 106.95 106.95 106.95 100.67
10 years 230.85 269.56 230.85 230.85 230.85 217.99
</TABLE>
INVESCO VIF
Industrial
Income
1 year $ 22.41
3 years 69.09
5 years 118.39
10 years 254.04
This example should not be considered a representation of past or
future expenses. Actual expenses may be more or less than those
shown.<PAGE>
PAGE 12
* In this example, the $30 annual contract administrative charge is
approximated as a .286% charge based on our estimated average
contract size.
Financial statements
The SAI dated Oct. 31, 1995, contains:
The statutory financial statements of American Partners Life
including:
-balance sheets as of Dec. 31, 1994 and Dec. 31, 1993
-related statements of operations, changes in capital and
surplus and cash flows for the years ended Dec. 31, 1994 and
1993
and the unaudited statutory financial statements for American
Partners Life including:
-balance sheet as of June 30, 1995 and
-related statements of operations, changes in capital and
surplus and cash flows for the six months ended June 30,
1995.
Performance information
Performance information for the variable subaccounts may appear
from time to time in advertisements or sales literature. In all
cases, such information reflects the performance of a hypothetical
investment in a particular account during a particular time period.
Calculations are performed as follows:
Simple yield - IDS Life Moneyshare Subaccount: Income over a given
seven-day period (not counting any change in the capital value of
the investment) is annualized (multiplied by 52) by assuming that
the same income is received for 52 weeks. This annual income is
then stated as an annual percentage return on the investment.
Compound yield - IDS Life Moneyshare Subaccount: Calculated like
simple yield, except that, when annualized, the income is assumed
to be reinvested. Compounding of reinvested returns increases the
yield as compared to a simple yield.
Yield - IDS Life Special Income Subaccount: Net investment income
(income less expenses) per accumulation unit during a given 30-day
period is divided by the value of the unit on the last day of the
period. The result is converted to an annual percentage.
Average annual total return: Expressed as an average annual
compounded rate of return of a hypothetical investment over a
period of one, five and ten years (or up to the life of the
subaccount if it is less than ten years old). This figure reflects
deduction of all applicable charges, including the contract
administrative charge, and mortality and expense risk fee.
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PAGE 13
Aggregate total return: Represents the cumulative change in value
of an investment for a given period (reflecting change in a
subaccount's accumulation unit value). The calculation assumes
reinvestment of investment earnings and reflects deduction of all
applicable charges, including the contract administrative charge
and mortality and expense risk fee. Aggregate total return may be
shown by means of schedules, charts or graphs.
Performance information should be considered in light of the
investment objectives and policies, characteristics and quality of
the fund in which the subaccount invests and the market conditions
during the given time period. Such information is not intended to
indicate future performance. Because advertised yields and total
return figures include all charges attributable to the annuity,
which has the effect of decreasing advertised performance,
subaccount performance should not be compared to that of mutual
funds that sell their shares directly to the public. (See the SAI
for a further description of methods used to determine yield and
total return for the subaccounts.)
If you would like additional information about actual performance,
contact American Partners Life.
The variable account
Purchase payments can be allocated to any or all of the subaccounts
of the variable account that invest in shares of the following
funds:
Subaccount
IDS Life Aggressive Growth Fund CAG
IDS Life International Equity Fund CIE
IDS Life Capital Resource Fund CCR
IDS Life Managed Fund CMG
IDS Life Special Income Fund CSI
IDS Life Moneyshare Fund CMS
INVESCO VIF - Industrial Income Portfolio CII
Each variable subaccount meets the definition of a separate account
under federal securities laws. Income, capital gains and capital
losses of each subaccount are credited or charged to that account
alone. No subaccount will be charged with liabilities of any other
variable account or of our general business. The obligations
arising under the contracts are general obligations of American
Partners Life.
The variable account was established under Arizona law and is
registered as a unit investment trust under the Investment Company
Act of 1940 (the 1940 Act). This registration does not involve any
supervision of our management or investment practices and policies
by the SEC.
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PAGE 14
The funds
IDS Life Aggressive Growth Fund
Objective: capital appreciation. Invests primarily in common stock
of small- and medium-size companies.
IDS Life International Equity Fund
Objective: capital appreciation. Invests primarily in common stock
of foreign issuers and foreign securities convertible into common
stock.
IDS Life Capital Resource Fund
Objective: capital appreciation. Invests primarily in U.S. common
stocks listed on national securities exchanges and other securities
convertible into common stock, diversified over many different
companies in a variety of industries.
IDS Life Managed Fund
Objective: maximum total investment return. Invests primarily in
U.S. common stocks listed on national securities exchanges,
securities convertible into common stock, warrants, fixed income
securities (primarily high-quality corporate bonds) and money
market instruments.
IDS Life Special Income Fund
Objective: to provide a high level of current income while
conserving the value of the investment for the longest time period.
Invests primarily in high-quality, lower-risk corporate bonds
issued by many different companies in a variety of industries, and
in government bonds.
IDS Life Moneyshare Fund
Objective: maximum current income consistent with liquidity and
conservation of capital. Invests in high-quality money market
securities with remaining maturities of 13 months or less. The
fund also will maintain a dollar-weighted average portfolio
maturity not exceeding 90 days. The fund attempts to maintain a
constant net asset value of $1 per share.
INVESCO VIF - Industrial Income Portfolio
Objective: to seek the best possible current income while following
sound investment practices with capital growth potential as a
secondary consideration. Invests in securities providing a
relatively high yield and stable return and which, over a period of
years, also may provide capital appreciation.
All funds are available to serve as the underlying investment for
variable annuities, and some funds are available to serve as the
underlying investment for variable annuities and variable life
insurance contracts. It is conceivable that in the future it may
be disadvantageous for variable annuity separate accounts and
variable life insurance separate accounts to invest in the
available funds simultaneously. Although American Partners Life
and the funds do not currently foresee any such disadvantages
either to variable annuity contract owners or to variable life
insurance policy owners, the boards of directors or trustees of the
appropriate funds will monitor events in order to identify any
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PAGE 15
material conflicts between such contract owners and policy owners
and to determine what action, if any, should be taken in response
to a conflict. If a board were to conclude that separate funds
should be established for variable life insurance and variable
annuity separate accounts, the variable annuity contract holders
would not bear any expenses associated with establishing separate
funds.
The Internal Revenue Service (IRS) has issued final regulations
relating to the diversification requirements under Section 817(h)
of the Code. Each mutual fund intends to comply with these
requirements.
The U.S. Treasury and the IRS have indicated they may provide
additional guidance concerning how many variable subaccounts may be
offered and how many exchanges among variable subaccounts may be
allowed before the owner is considered to have investment control,
and thus is currently taxed on income earned within variable
subaccount assets. We do not know at this time what the additional
guidance will be or when action will be taken. We reserve the
right to modify the contract, as necessary, to ensure that the
owner will not be subject to current taxation as the owner of the
variable subaccount assets.
We intend to comply with all federal tax laws to ensure that the
contract continues to qualify as an annuity for federal income tax
purposes. We reserve the right to modify the contract as necessary
to comply with any new tax laws.
IDS Life, IDS Tower 10, Minneapolis, MN 55440, is the investment
manager for each of the IDS Life Funds. INVESCO Funds Group, Inc.,
Post Office Box 173706, Denver, CO 80217-3706, is the investment
advisor for the INVESCO VIF - Industrial Income Portfolio. The
investment managers for the funds cannot guarantee that the funds
will meet their investment objectives. Please read the
prospectuses for the funds for complete information on investment
risks, deductions, expenses and other facts you should know before
investing. They are available by contacting American Partners Life
at the address or telephone number on the front of this
publication.
The fixed account
Purchase payments can also be allocated to the fixed account. The
cash value of the fixed account increases as interest is credited
to the account. Purchase payments and transfers to the fixed
account become part of the general account of American Partners
Life, the company's main portfolio of investments. Interest is
credited daily and compounded annually. We guarantee a minimum
interest rate of 3%. We may declare the interest rates above the
guaranteed rate from time to time.
Because of exemptive and exclusionary provisions, interests in the
fixed account have not been registered under the Securities Act of
1933 (1933 Act), nor is the fixed account registered as an
investment company under the 1940 Act. Accordingly, neither the
<PAGE>
PAGE 16
fixed account nor any interests in it are generally subject to the
provisions of the 1933 or 1940 Acts, and we have been advised that
the staff of the SEC has not reviewed the disclosures in this
prospectus that relate to the fixed account. Disclosures regarding
the fixed account, however, may be subject to certain generally
applicable provisions of the federal securities laws relating to
the accuracy and completeness of statements made in prospectuses.
Buying your annuity
Our representative can help you prepare and submit your
application. Alternatively, you may ask us for the forms and
prepare them yourself. As the owner, you have all rights and may
receive all benefits under the contract. Annuities cannot be owned
in joint tenancy.
When you apply, you can select:
o the account(s) in which you want to invest;
o how you want to make purchase payments;
o the date you want to start receiving annuity payouts (the
annuity start date); and
o a beneficiary.
If your application is complete, we will process it and apply your
purchase payment to your account(s) within two days after we
receive it. If your application is accepted, we will send you a
contract. If we cannot accept your application within five days,
we will decline it and return your payment. We will credit
additional purchase payments you make to an existing contract to
your account(s) at the next close of business.
Setting the annuity start date
Annuity payouts will be scheduled to begin on the annuity start
date. This date can be aligned with your actual retirement from a
job, or it can be a different future date, depending on your needs
and goals and on certain restrictions. You can also change the
date, provided you send us written instructions at least 30 days
before annuity payouts begin.
For nonqualified annuities, the annuity start date must be:
o no earlier than the 60th day after the contract's effective
date; and
o no later than the annuitant's 85th birthday or before the 10th
contract anniversary, if purchased after age 75. (In
Pennsylvania, the annuity start date must be no later than the
annuitant's 85th birthday.)
For qualified annuities, to avoid IRS penalty taxes, the annuity
start date generally must be:
o on or after the annuitant reaches age 59 1/2; and
o by April 1 of the year following the calendar year when the
annuitant reaches age 70 1/2.
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PAGE 17
If you are taking the minimum IRA distributions as required by the
Code from another tax-qualified investment, or in the form of
partial surrenders from this annuity, annuity payouts can start as
late as the annuitant's 85th birthday or the 10th contract
anniversary. (In Pennsylvania, annuity payouts must start no later
than the annuitant's 85th birthday.)
Beneficiary
If death benefits become payable before the annuity start date,
your named beneficiary will receive all or part of the contract
value. If there is no named beneficiary, then you or your estate
will be the beneficiary. (See "Payment in case of death" for more
about beneficiaries.)
Minimum purchase payments
If single payment:
Nonqualified: $2,000
Qualified: $1,000
If installment payments:
$100 monthly; $50.00 biweekly
Installments must total at least $1,000 in the first year.*
*If you make no purchase payments for the most recent 24 months,
and your previous payments total $1,000 or less, we have the right
to give you 30 days' written notice and pay you the total value of
your contract in a lump sum. This restriction does not apply to
contracts sold to New Jersey residents.
Minimum additional purchase payment(s): $100
Maximum first-year payment(s):
This maximum is based on your age or age of the annuitant (whomever
is older) on the effective date of the contract.
Up to age 75 $1 million
76 to 85 $500,000
86 to 90 $50,000
Maximum payment for each subsequent year: $50,000**
**These limits apply in total to all American Partners Life
annuities you own. We reserve the right to increase maximum limits
or reduce age limits. For qualified annuities the qualified plan's
limits on annual contributions also apply.
Three ways to make purchase payments
1 By letter
Send your check along with your name and account number to:
<PAGE>
PAGE 18
Regular mail:
American Partners Life Insurance Company
80 South Eighth Street
P6/Unit 1751
P.O. Box 59197
Minneapolis, MN 55459-0197
Express mail:
American Partners Life Insurance Company
80 South Eighth Street
P6/Unit 1751
Minneapolis, MN 55402
2 By scheduled payment plan
Through:
o a bank authorization.
3 Other
o wire transfer; or
o other method acceptable to us.
Charges
Contract administrative charge
This charge is for establishing and maintaining your records. On
each contract anniversary we will deduct $30 from the contract
value. The deduction will be allocated among the subaccounts on a
pro-rata basis.
This charge will be waived for any contract year where the total
purchase payments (less partial surrenders) on the current contract
anniversary is $10,000 or more, or if, during the contract year, a
death benefit is payable or the contract is surrendered in full.
This charge does not apply after annuity payouts begin.
We do not expect to profit from the contract administrative charge.
While we do not currently plan to increase the charge, we reserve
the right to increase the charge in the future. In no event will
the charge exceed $50 per year. Also, we reserve the right to
impose the charge on all contracts, including those with purchase
payments equal to or greater than $10,000.
Mortality and expense risk fee
This fee is to cover the mortality risk and expense risk and is
applied daily to the variable subaccounts and reflected in the unit
values of the accounts. Annually it totals 1% of their average
daily net assets. Approximately two-thirds of this amount is for
our assumption of mortality risk, and one-third is for our
assumption of expense risk. This fee does not apply to the fixed
account.
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PAGE 19
Mortality risk arises because of our guarantee to pay a death
benefit and our guarantee to make annuity payouts according to the
terms of the contract, no matter how long a specific annuitant
lives and no matter how long the entire group of American Partners
Life annuitants live. If, as a group, American Partners Life
annuitants outlive the life expectancy we have assumed in our
actuarial tables, then we must take money from our general assets
to meet our obligations. If, as a group, American Partners Life
annuitants do not live as long as expected, we could profit from
the mortality risk fee.
Expense risk arises because the contract administrative charge may
not cover our expenses. Any deficit would have to be made up from
our general assets. We could profit from the expense risk fee if
the annual contract administrative charge is more than sufficient
to meet expenses.
We do hope to profit from the mortality and expense risk fee. We
may use any profits realized from this fee for any proper corporate
purpose, including, among others, payment of distribution (selling)
expenses.
Premium taxes
Certain state and local governments impose premium taxes of up to
3.5%. These taxes are dependent upon the state of residence or the
state in which the contract was sold and are deducted as
applicable. In some cases, premium taxes are deducted from your
purchase payments before they are allocated. In other cases, the
deduction is made when you surrender your contract or when annuity
payouts begin.
Other information on charges
There is no surrender charge if you take a total or a partial
surrender from your contract.
In some cases lower sales and administrative expenses may be
incurred. In such cases, we may be able to reduce or eliminate the
contract administrative charge. However, we expect this to occur
infrequently.
Valuing your investment
Here is how your accounts are valued:
Fixed account: The amounts allocated to the fixed account are
valued directly in dollars and equal the sum of your purchase
payments plus interest earned, less any amounts surrendered or
transferred.
Variable subaccounts: Amounts allocated to the variable
subaccounts are converted into accumulation units. Each time you
make a purchase payment or transfer amounts into one of the
variable subaccounts, a certain number of accumulation units are
credited to your contract for that account. Conversely, each time
you take a partial surrender, transfer amounts out of a variable
<PAGE>
PAGE 20
subaccount or are assessed a contract administrative charge, a
certain number of accumulation units are subtracted from your
contract.
The accumulation units are the true measure of investment value in
each subaccount during the accumulation period. They are related
to, but not the same as, the net asset value of the underlying
fund.
The dollar value of each accumulation unit can rise or fall daily
depending on the performance of the underlying mutual fund and on
certain fund expenses. Here is how unit values are calculated:
Number of units
To calculate the number of accumulation units for a particular
subaccount, we divide your investment, after deduction of any
premium taxes, by the current accumulation unit value.
Accumulation unit value
The current accumulation unit value for each variable subaccount
equals the last value times the subaccount's current net investment
factor.
Net investment factor
o Determined each business day by adding the underlying mutual
fund's current net asset value per share plus per-share amount
of any current dividend or capital gain distribution; then
o dividing that sum by the previous net asset value per share; and
o subtracting the percentage factor representing the mortality and
expense risk fee from the result.
Because the net asset value of the underlying mutual fund may
fluctuate, the accumulation unit value may increase or decrease.
You bear this investment risk in a variable subaccount.
Factors that affect variable subaccount accumulation units
Accumulation units may change in two ways; in number and in value.
Here are the factors that influence those changes:
The number of accumulation units you own may fluctuate due to:
o additional purchase payments allocated to the variable
subaccounts;
o transfers into or out of the variable subaccount(s);
o partial surrenders; and/or
o contract administrative charges.
Accumulation unit values may fluctuate due to:
o changes in underlying mutual fund(s) net asset value;
o dividends distributed to the variable subaccount(s);
o capital gains or losses of underlying mutual funds;
o mutual fund operating expenses; and/or
o mortality and expense risk fees.
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Making the most of your annuity
Automated dollar-cost averaging
You can use automated transfers to take advantage of dollar-cost
averaging (investing a fixed amount at regular intervals). For
example, you might have a set amount transferred monthly from a
relatively conservative variable subaccount to a more aggressive
one, or to several others.
This systematic approach can help you benefit from fluctuations in
accumulation unit values caused by fluctuations in the market
value(s) of the underlying mutual fund(s). Since you invest the
same amount each period, you automatically acquire more units when
the market value falls, fewer units when it rises. The potential
effect is to lower your average cost per unit. Contact our service
office for more information.
<TABLE>
<CAPTION>
How dollar-cost averaging works
Month Amount Accumulation Number of units
invested unit value purchased
<S> <C> <C> <C> <C>
By investing an Jan $100 $20 5.00
equal number of
dollars each month.... Feb 100 16 6.25
Mar 100 9 11.11
you automatically Apr 100 5 20.00
buy more units
when the per unit May 100 7 14.29
market price is low....
June 100 10 10.00
July 100 15 6.67
and fewer units Aug 100 20 5.00
when the per unit
market price is Sept 100 17 5.88
high.
Oct 100 12 8.33
</TABLE>
You have paid an average price of only $10.81 per unit over the 10
months, while the average market price actually was $13.10.
Dollar-cost averaging does not guarantee that any variable
subaccount will gain in value, nor will it protect against a
decline in value if market prices fall. However, if you can
continue to invest regularly throughout changing market conditions,
it can be an effective strategy to help meet your long term goals.
Transferring money between accounts
You may transfer money from any one subaccount or the fixed account
to another at any time before annuity payouts begin. If we receive
your request before the close of business, we will process it that
day. Requests received after the close of business will be
processed the next business day. Before making a transfer, you
should consider the risks involved in switching investments. We
may suspend or modify transfer privileges at any time.
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PAGE 22
Transfer policies
o You may transfer contract values at any time between the
variable subaccounts, from the variable subaccount(s) to the
fixed account or from the fixed account to the variable
subaccount(s).
o The amount being transferred to any one account must be at least
$100.
o If you make more than 12 transfers in a contract year, we will
charge $25 for each transfer in excess of 12.
o Excessive trading activity can disrupt mutual fund management
strategy and increase expenses, which are borne by all contract
owners participating in the mutual fund regardless of their
transfer activity. Therefore, we reserve the right to limit the
number of transfers permitted, but not to fewer than twelve per
contract year.
Three ways to request a transfer or a surrender
1 By letter
Send your name, contract number, Social Security Number or Taxpayer
Identification Number and signed request for a transfer or
surrender to:
Regular mail:
American Partners Life Insurance Company
P6/Unit 1751
P.O. Box 59197
Minneapolis, MN 55459-0197
Express mail:
American Partners Life Insurance Company
80 South Eighth Street
P6/Unit 1751
Minneapolis, MN 55402
Minimum amount
Mail transfers: $100 or entire account balance
Mail surrenders: $100 or entire account balance
Maximum amount
Mail transfers: None (up to contract value)
Mail surrenders: None (up to contract value)
2 By phone
Call between 7 a.m. and 6 p.m. Central time:
1-800-AXP-SERV (toll free)
(1-800-297-7378)
TTY service for the hearing impaired:
1-800-710-5260 (toll free)
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PAGE 23
Minimum amount
Phone transfers: $100 or entire account balance
Phone surrenders: $100 or entire account balance
Maximum amount
Phone transfers: None (up to contract value)
Phone surrenders: $50,000
We answer phone requests promptly, but you may experience delays
when the call volume is unusually high. If you are unable to get
through, use the mail procedure as an alternative.
We will honor any telephone transfer or surrender request believed
to be authentic and will use reasonable procedures to confirm that
they are. This includes asking identifying questions and tape
recording calls. A telephone surrender will not be allowed within
30 days of a phoned-in address change. As long as the procedures
are followed, neither American Partners Life nor its affiliates
will be liable for any loss resulting from fraudulent requests.
Telephone transfers or surrenders are automatically available. You
may request that telephone transfers or surrenders not be
authorized from your account by writing American Partners Life.
3 By automated transfers and automated partial surrenders
o You can set up automated transfers among your accounts or
partial surrenders from the accounts.
You can start or stop this service by written request or other
method acceptable to American Partners Life. You must allow 30
days for American Partners Life to change any instructions that are
currently in place.
o Automated transfers and automated partial surrenders are subject
to all of the contract provisions and terms, including transfer
of contract values between accounts. Automated surrenders may
be restricted by applicable law under some contracts.
o Automated partial surrenders may result in IRS taxes and
penalties on all or part of the amount surrendered.
Minimum amount
Automated transfers or surrenders: $100
Maximum amount
Automated transfers or surrenders: None
Surrendering your contract
As owner, you may surrender all or part of your contract at any
time before annuity payouts begin by sending a written request or
calling American Partners Life. For total surrenders we will
compute the value of your contract at the close of business after
we receive your request. We may ask you to return the contract.
You may have to pay IRS taxes and penalties. (See "Taxes.") No
surrenders may be made after annuity payouts begin.
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PAGE 24
Surrender policies
If you have a balance in more than one account and request a
partial surrender, we will surrender money from all your accounts
in the same proportion as your value in each account correlates to
your total contract value, unless you request otherwise.
Receiving payment when you request a surrender
By regular or express mail:
o Payable to owner.
o Normally mailed to address of record within seven days after
receiving your request. However, we may postpone the payment
if:
-the surrender amount includes a purchase payment check that
has not cleared;
-the NYSE is closed, except for normal holiday and weekend
closings;
-trading on the NYSE is restricted, according to SEC rules;
-an emergency, as defined by SEC rules, makes it impractical
to sell securities or value the net assets of the accounts;
or
-the SEC permits us to delay payment for the protection of
security holders.
Changing ownership
You may change ownership of your non-qualified annuity at any time
by filing a change of ownership with us at our service office. The
change will become binding upon us when we receive and record it.
We will honor any change of ownership request believed to be
authentic and will use reasonable procedures to confirm that it is.
If these procedures are followed, we take no responsibility for the
validity of the change.
If you have a nonqualified annuity, you may lose your tax
advantages by transferring, assigning or pledging any part of it.
(See "Taxes.")
If you have a qualified annuity, you may not sell, assign,
transfer, discount or pledge your contract as collateral for a
loan, or as security for the performance of an obligation or for
any other purpose to any person except American Partners Life.
However, if the owner is a trust or custodian, or an employer
acting in a similar capacity, ownership of a contract may be
transferred to the annuitant.
Benefits in case of death
If you or the annuitant dies (or, for qualified annuities, if the
annuitant dies) before annuity payouts begin, we will pay the
beneficiary the greater of:
o the contract value; or
o purchase payments, minus any partial surrenders.
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PAGE 25
If your spouse is sole beneficiary under a non-qualified annuity
and you die before the annuity start date, your spouse may keep the
annuity as owner. To do this your spouse must, within 60 days
after we receive proof of death, give us written instructions to
keep the contract in force.
Under a qualified annuity, if the annuitant dies before reaching
age 70 1/2 and before the annuity start date, and the spouse is the
only beneficiary, the spouse may keep the annuity in force as owner
or until the date on which the annuitant would have reached age 70
1/2. To do this, the spouse must give us written instructions
within 60 days after we receive proof of death.
Payouts: We will pay the beneficiary in a single sum unless you
have given us other written instructions, or the beneficiary may
receive payouts under any annuity payout plan available under this
contract if:
o the beneficiary asks us in writing within 60 days after we
receive proof of death;
o payouts begin no later than one year after death; and
o the payout period does not extend beyond the beneficiary's life
or life expectancy.
When paying the beneficiary, we will determine the contract's value
at the next close of business after our death claim requirements
are fulfilled. Interest, if any, will be paid from the date of
death at a rate no less than required by law. We will mail payment
to the beneficiary within seven days after our death claim
requirements are fulfilled. (See "Taxes.")
The annuity payout period
As owner of the contract, you have the right to decide how and to
whom annuity payouts will be made starting at the annuity start
date. You may select one of the annuity payout plans outlined
below, or we will mutually agree on other payout arrangements. The
amount available for payouts under the plan you select is the
contract value on your annuity start date. Annuity payouts will be
made on a fixed basis.
Amounts of payouts depend on:
o the annuity payout plan you select;
o the annuitant's age and, in most cases, sex;
o the annuity table in the contract.
Annuity payout plans
You may choose any one of these annuity payout plans by giving us
written instructions at least 30 days before contract values are to
be used to purchase the payout plan:
o Plan A - Life annuity - no refund: Monthly payouts are made
until the annuitant's death. Payouts end with the last payout
before the annuitant's death; no further payouts will be made.
This means that if the annuitant dies after only one monthly payout
has been made, no more payouts will be made.
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PAGE 26
o Plan B - Life annuity with five, 10 or 15 years certain: Monthly
payouts are made for a guaranteed payout period of five, 10 or 15
years that the annuitant elects. This election will determine the
length of the payout period to the beneficiary if the annuitant
should die before the elected period has expired. The guaranteed
payout period is calculated from the annuity start date. If the
annuitant outlives the elected guaranteed payout period, payouts
will continue until the annuitant's death.
o Plan C - Life annuity - installment refund: Monthly payouts are
made until the annuitant's death, with our guarantee that payouts
will continue for some period of time. Payouts will be made for at
least the number of months determined by dividing the amount
applied under this option by the first monthly payout, whether or
not the annuitant is living.
o Plan D - Joint and last survivor life annuity - no refund:
Monthly payouts are made to the annuitant and a joint annuitant
while both are living. If either annuitant dies, monthly payouts
continue at the full amount until the death of the surviving
annuitant. Payouts end with the death of the second annuitant.
o Plan E - Payouts for a specified period: Monthly payouts are
made for a specific payout period of 10 to 30 years chosen by the
annuitant. Payouts will be made only for the number of years
specified whether the annuitant is living or not. Depending on the
time period selected, it is foreseeable that an annuitant can
outlive the payout period selected. In addition, a 10% IRS penalty
tax could apply under this payout plan. (See "Taxes".)
Restrictions for some qualified plans: If you purchased a
qualified annuity, you must select a payout plan that provides for
payouts:
o over the life of the annuitant;
o over the joint lives of the annuitant and a designated
beneficiary;
o for a period not exceeding the life expectancy of the
annuitant; or
o for a period not exceeding the joint life expectancies
of the annuitant and a designated beneficiary.
If we do not receive instructions: You must give us written
instructions for the annuity payouts at least 30 days before the
annuitant's annuity start date. If you do not, we will make
payouts under Plan B, with 120 monthly payouts guaranteed.
If monthly payouts would be less than $20: We will calculate the
amount of monthly payouts at the time the contract value is used to
purchase a payout plan. If the calculations show that monthly
payouts would be less than $20, we have the right to pay the
contract value to the owner in a lump sum.
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PAGE 27
Death after annuity payouts begin
If you or the annuitant dies after annuity payouts begin, any
amount payable to the beneficiary will be provided in the annuity
payout plan in effect.
Taxes
Generally, under current law, any increase in your contract value
is taxable to you only when you receive a payout or surrender.
(However, see detailed discussion below.) Any portion of the
annuity payouts and any surrenders you request that represent
ordinary income are normally taxable. You will receive a 1099 tax
information form for any year in which a taxable distribution was
made.
Annuity payouts under nonqualified annuities: A portion of each
payout will be ordinary income and subject to tax, and a portion of
each payout will be considered a return of part of your investment
and will not be taxed. All amounts received after your investment
in the annuity is fully recovered will be subject to tax.
Tax law requires that all nonqualified deferred annuity contracts
issued by the same company to the same owner during a calendar year
are to be taxed as a single, unified contract when distributions
are taken from any one of such contracts.
Annuity payouts under qualified annuities: Under a qualified
annuity, the entire payout generally will be includable as ordinary
income and subject to tax except to the extent that contributions
were made with after-tax dollars. If you invested in your contract
with pre-tax dollars as part of a qualified retirement plan, such
amounts are not considered to be part of your investment in the
contract and will be taxed when paid to you.
Surrenders: If you surrender part or all of your contract before
your annuity payouts begin, your surrender payment will be taxed to
the extent that the value of your contract immediately before the
surrender exceeds your investment. You also may have to pay a 10%
IRS penalty for surrenders before reaching age 59 1/2. For
qualified annuities, other penalties may apply if you surrender
your annuity before your plan specifies that you can receive
payouts.
Death benefits to beneficiaries: The death benefit under an
annuity is not tax-exempt. Any amount received by the beneficiary
that represents previously deferred earnings within the contract is
taxable as ordinary income to the beneficiary in the year(s) he or
she receives the payments.
Annuities owned by corporations, partnerships or trusts: Any
annual increase in the value of annuities held by such entities
generally will be treated as ordinary income received during that
year. This provision is effective for purchase payments made after
Feb. 28, 1986. However, if the trust was set up for the benefit of
a natural person only, the increase in value will be tax-deferred.
<PAGE>
PAGE 28
Penalties: If you receive amounts from your contract before
reaching age 59 1/2, you may have to pay a 10% IRS penalty on the
amount includable in your ordinary income. However, this penalty
will not apply to any amount received by you or your beneficiary:
o because of your death;
o because you become disabled (as defined in the Code);
o if the distribution is part of a series of substantially equal
periodic payments, made at least annually, over your life or
life expectancy (or joint lives or life expectancies of you and
your beneficiary); or
o if it is allocable to an investment before Aug. 14, 1982 (except
for qualified annuities).
For a qualified annuity, other penalties or exceptions may apply if
you surrender your annuity before your plan specifies that payouts
can be made.
Withholding, generally: If you receive all or part of the contract
value from an annuity, withholding may be imposed against the
taxable income portion of the payment. Any withholding that is
done represents a prepayment of your tax due for the year. You
take credit for such amounts on the annual tax return that you
file.
If the payment is part of an annuity payout plan, the amount of
withholding generally is computed using payroll tables. You can
provide us with a statement of how many exemptions to use in
calculating the withholding. As long as you've provided us with a
valid Social Security Number or Taxpayer Identification Number, you
can elect not to have any withholding occur.
If the distribution is any other type of payment (such as a partial
or total surrender) withholding is computed using 10% of the
taxable portion. Similar to above, as long as you've provided us
with a valid Social Security Number or Taxpayer Identification
Number, you can elect not to have this withholding occur.
Some states also impose withholding requirements similar to the
federal withholding described above. If this should be the case,
any payment from which federal withholding is deducted may also
have state withholding deducted. The withholding requirements may
differ if payment is being made to a non-U.S. citizen or if the
payment is being delivered outside the United States.
Transfer of ownership of a nonqualified annuity: If you make such
a transfer without receiving adequate consideration, the transfer
is considered a gift, and also may be considered a surrender for
federal income tax purposes. If the gift is a currently taxable
event, the amount of deferred earnings at the time of the transfer
will be taxed to the original owner, who also may be subject to a
10% IRS penalty as discussed earlier. In this case, the new
owner's investment in the annuity will be the value of the annuity
at the time of the transfer.
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PAGE 29
Collateral assignment of a nonqualified annuity: If you
collaterally assign or pledge your contract, earnings on purchase
payments you made after Aug. 13, 1982 will be taxed to you like a
surrender.
Important: Our discussion of federal tax laws is based upon our
understanding of these laws as they are currently interpreted.
Federal tax laws or current interpretations of them may change.
For this reason and because tax consequences are complex and highly
individual and cannot always be anticipated, you should consult a
tax adviser if you have any questions about taxation of your
contract.
Tax Qualifications
The contract is intended to qualify as an annuity for federal
income tax purposes. To that end, the provisions of the contract
are to be interpreted to ensure or maintain such tax qualification,
notwithstanding any other provisions of the contract. We reserve
the right to amend the contract to reflect any clarifications that
may be needed or are appropriate to maintain such qualification or
to conform the contract to any applicable changes in the tax
qualification requirements. We will send you a copy of any such
amendments.
Voting rights
As a contract owner with investments in the variable account(s),
you may vote on important mutual fund policies. We will vote fund
shares according to your instructions.
The number of votes you have is determined by applying your
percentage interest in each variable subaccount to the total number
of votes allowed to the subaccount.
We calculate votes separately for each subaccount not more than 60
days before a shareholders' meeting. Notice of these meetings,
proxy materials and a statement of the number of votes to which the
voter is entitled, will be sent.
We will vote shares for which we have not received instructions in
the same proportion as the votes for which we have received
instructions. We also will vote the shares for which we have
voting rights in the same proportion as the votes for which we have
received instructions.
Substitution of Investments
If shares of any fund should not be available for purchase by the
appropriate variable subaccount or if, in the judgment of American
Partners Life's Management, further investment in such shares is no
longer appropriate in view of the purposes of the subaccount,
investment in the subaccount may be discontinued or another
registered open-end management investment company may be
substituted for fund shares held in the subaccounts if American
Partners Life believes it would be in the best interest of persons
having voting rights under the contract. The variable account may
<PAGE>
PAGE 30
be operated as a management company under the 1940 Act or it may be
deregistered under this Act if the registration is no longer
required. In the event of any such substitution or change,
American Partners Life, without the consent or approval of the
owners, may amend the contract and take whatever action is
necessary and appropriate. However, no such substitution or change
will be made without the necessary approval of the SEC and state
insurance departments. American Partners Life will notify owners
of any substitution or change.
Distribution of the Contracts
The contracts will be distributed by American Express Financial
Advisors Inc., the principal underwriter for the variable account.
About American Partners Life
The Privileged Assets Select Annuity is issued by American Partners
Life. American Partners Life is a wholly owned subsidiary of IDS
Life Insurance Company, which is a wholly owned subsidiary of
American Express Financial Corporation. American Express Financial
Corporation is a wholly owned subsidiary of the American Express
Company. American Express Company is a financial services company
principally engaged through subsidiaries (in addition to American
Express Financial Corporation) in travel related services,
investment services and international banking services.
American Partners Life is a stock life insurance company organized
in 1988 under the laws of the State of Arizona. Its service office
is located at 80 South Eighth Street, Minneapolis, MN 55402. Its
statutory address is 3225 North Central Avenue, Phoenix, AZ.
American Partners Life is licensed in the state of Arizona and it
conducts a conventional life insurance business.
American Express Financial Advisors Inc. is the principal
underwriter for the variable account. Its corporate office is IDS
Tower 10, Minneapolis, MN 55440-0010. American Express Financial
Advisors Inc. is registered with the SEC under the Securities
Exchange Act of 1934 as a broker-dealer and is a member of the
National Association of Securities Dealers, Inc. American Express
Financial Advisors Inc. is a wholly owned subsidiary of American
Express Financial Corporation.
The American Express Financial Corporation family of companies also
offers mutual funds, investment certificates and a broad range of
financial management services.
Other subsidiaries provide investment management and related
services for pension, profit-sharing, employee savings and
endowment funds of businesses and institutions.
Regular and special reports
Services
To help you track and evaluate the performance of your annuity,
American Partners Life provides:
<PAGE>
PAGE 31
Quarterly statements showing the value of your investment.
Annual reports containing required information on the annuity and
its underlying investments.
<PAGE>
PAGE 32
Table of contents of the Statement of Additional Information
Performance information............................
Calculating annuity payouts........................
Depositor..........................................
Principal underwriter..............................
Independent auditors...............................
Mortality and expense risk fee.....................
Retirement planning................................
Prospectus.........................................
Financial statements -
American Partners Life Insurance Company.....
___________________________________________________________________
Please check the appropriate box to receive a copy of the Statement
of Additional Information for:
_____ Privileged Assets Select Annuity
_____ IDS Life Retirement Annuity Mutual Funds
_____ INVESCO Variable Investment Funds, Inc.
Please return this request to:
American Partners Life Insurance Company
80 South Eighth Street
P.O. Box 59197
Minneapolis, MN 55459-0197
Your name _______________________________________________________
Address _________________________________________________________
City ______________________ State ______________ Zip ___________
<PAGE>
PAGE 33
STATEMENT OF ADDITIONAL INFORMATION
for
PRIVILEGED ASSETS (registered trademark symbol) SELECT ANNUITY
APL VARIABLE ANNUITY ACCOUNT 1
Oct. 31, 1995
APL Variable Annuity Account 1 is a separate account established
and maintained by American Partners Life Insurance Company
(American Partners Life).
This Statement of Additional Information, dated Oct. 31, 1995, is
not a prospectus. It should be read together with the Account's
prospectus, dated Oct. 31, 1995, which may be obtained by writing
or calling American Partners Life at the address or telephone
number below.
American Partners Life Insurance Company
80 South Eighth Street
P.O. Box 59197
Minneapolis, MN 55459-0197
Phone #1-800-AXP-SERV (toll free)
(1-800-297-7378)
<PAGE>
PAGE 34
TABLE OF CONTENTS
Performance Information.......................................p. 3
Calculating Annuity Payouts...................................p. 5
Depositor.....................................................p. 6
Principal Underwriter.........................................p. 6
Independent Auditors..........................................p. 6
Mortality and Expense Risk Fee................................p. 6
Retirement Planning...........................................p. 6
Prospectus....................................................p. 7
Financial Statements
- American Partners Life Insurance Company..........p. 8
<PAGE>
PAGE 35
PERFORMANCE INFORMATION
The following performance figures are calculated on the basis of
historical performance of the funds. The performance figures
relating to these funds assume that the contract was in existence
prior to Sept. 15, 1995, which it was not. Beginning Sept. 15,
1995, when these funds became available as investment options under
the contract, actual values are used for the calculations.
Calculation of yield for IDS Life Moneyshare Subaccount
Simple yield for the IDS Life Moneyshare subaccount (CMS) will be
based on the: (a) change in the value of a hypothetical investment
(exclusive of capital changes) at the beginning of a seven-day
period for which yield is to be quoted; (b) subtracting a pro rata
share of subaccount expenses accrued over the seven-day period; (c)
dividing the difference by the value of the subaccount at the
beginning of the period to obtain the base period return; and (d)
annualizing the results (i.e., multiplying the base period return
by 365/7). Calculation of compound yield begins with the same base
period return used in the calculation of yield, which is then
annualized to reflect compounding according to the following
formula:
Compound Yield = [(return for seven-day period + 1) 365/7 ]-1
On June 30, 1995, the account's annualized yield was 4.24% and its
compound yield was 4.33%.
The rate of return, or yield, on the subaccount's accumulation unit
may fluctuate daily and does not provide a basis for determining
future yields. Investors must consider, when comparing an
investment in subaccount CMS with fixed annuities, that fixed
annuities often provide an agreed-to or guaranteed fixed yield for
a stated period of time, whereas the variable subaccount's yield
fluctuates. In comparing the yield of subaccount CMS to a money
market fund, you should consider the different services that the
annuity provides.
Calculation of yield for IDS Life Special Income Subaccount
For the IDS Life Special Income Subaccount (CSI), quotations of
yield will be based on all investment income earned during a
particular 30-day period, less expenses accrued during the period
(net investment income) and will be computed by dividing net
investment income per accumulation unit by the value of an
accumulation unit on the last day of the period, according to the
following formula:
YIELD = 2[(a-b + 1)6 - 1]
cd
<PAGE>
PAGE 36
where: a = dividends and investment income earned during the
period.
b = expenses accrued for the period (net of
reimbursements).
c = the average daily number of accumulation units
outstanding during the period that were entitled to
receive dividends.
d = the maximum offering price per accumulation unit on
the last day of the period.
Yield on the subaccount is earned from the increase in the net
asset value of shares of the fund in which the subaccount invests
and from dividends declared and paid by the fund, which are
automatically invested in shares of the fund.
Calculation of average annual total return
Quotations of average annual total return for a subaccount will be
expressed in terms of the average annual compounded rate of return
of a hypothetical investment in the annuity contract over a period
of one, five and 10 years (or, if less, up to the life of the
subaccount), calculated according to the following formula:
P(1+T)n = ERV
where: P = a hypothetical initial payment of $1,000.
T = average annual total return.
n = number of years.
ERV = Ending Redeemable Value of a hypothetical $1,000
payment made at the beginning of the one, five,
or ten year (or other) period at the end of the
one, five, or ten year (or other) period (or
fractional portion thereof).
The Securities and Exchange Commission requires that an assumption
be made that the contract owner surrenders the entire contract at
the end of the one, five and ten year periods (or, if less, up to
the life of the subaccount) for which performance is required to be
calculated.
<PAGE>
PAGE 37
Average Annual Total Return Period Ended: Dec. 31, 1994
<TABLE>
<CAPTION>
Average Annual Total Return with or without Surrender
Since
Subaccount investing in: 1 Year 5 Years 10 Years Inception
<S> <C> <C> <C> <C>
IDS LIFE
Aggressive Growth Fund (1/92)* 25.00% -- -- 7.71%
Capital Resource Fund (10/81) 20.73% 11.24% 12.71% --
International Equity Fund (1/92) -1.75% -- -- 6.72%
Managed Fund (4/86) 13.46% 9.84% -- 9.74%
Moneyshare Fund (10/81) 3.92% 3.28% 4.69% --
Special Income Fund (10/81) 12.75% 9.79% 9.11% --
INVESCO VIF
Industrial Income Portfolio (8/94) 13.12%
*inception dates of the funds are shown in parentheses.
</TABLE>
Aggregate Total Return
Aggregate total return represents the cumulative change in value of
an investment for a given period (reflecting change in a
subaccount's accumulation unit value) and is computed by the
following formula:
ERV-P
P
where: P = a hypothetical initial payment of $1,000.
ERV = Ending Redeemable Value of a hypothetical $1,000
payment made at the beginning of the one, five,
or ten year (or other) period at the end of the
one, five, or ten year (or other) period (or
fractional portion thereof).
Subaccount total return figures reflect the deduction of the
contract administrative charge and mortality and expense risk fee.
Performance of the subaccounts may be quoted or compared to
rankings, yields, or returns as published or prepared by
independent rating or statistical services or publishers or
publications such as The Bank Rate Monitor National Index,
Barron's, Business Week, Donoghue's Money Market Fund Report,
Financial Services Week, Financial Times, Financial World, Forbes,
Fortune, Global Investor, Institutional Investor, Investor's Daily,
Kiplinger's Personal Finance, Lipper Analytical Services, Money,
Mutual Fund Forecaster, Newsweek, The New York Times, Personal
Investor, Stanger Report, Sylvia Porter's Personal Finance, USA
Today, U.S. News and World Report, The Wall Street Journal and
Wiesenberger Investment Companies Service.
CALCULATING ANNUITY PAYOUTS
Your fixed annuity payout amounts are guaranteed. Once calculated,
your payout will remain the same and never change. To calculate
your annuity payouts we:
<PAGE>
PAGE 38
o take the total value of your fixed account and the subaccounts
at the annuity start date or the date you have selected to begin
receiving your annuity payouts; then
o using an annuity table we apply the value according to the
annuity payout plan you select.
o The annuity payout table we use will be the one in effect at the
time you choose to begin your annuity payouts. The table will be
equal to or greater than the table in your contract.
DEPOSITOR
National Pension Life Insurance Company was established on October
14, 1988 and changed its name to American Partners Life Insurance
Company on February 18, 1994.
PRINCIPAL UNDERWRITER
The principal underwriter for the accounts is American Express
Financial Advisors Inc. which offers the variable contracts on a
continuous basis.
INDEPENDENT AUDITORS
The statutory basis financial statements of American Partners Life
Insurance Company (a wholly owned subsidiary of IDS Life Insurance
Company) at December 31, 1994 and for the year then ended, have
been audited by Ernst & Young LLP, independent auditors as stated
in their report appearing herein.
MORTALITY AND EXPENSE RISK FEE
American Partners Life has represented to the SEC that:
American Partners Life has reviewed publicly available information
regarding products of other companies. Based upon this review,
American Partners Life has concluded that the mortality and expense
risk fee is within the range of charges determined by industry
practice. American Partners Life will maintain at its
administrative office, and make available on request of the SEC or
its staff, a memorandum setting forth in detail the variable
products analyzed and the methodology, and results of, its
comparative review.
American Partners Life has concluded that there is a reasonable
likelihood that the proposed distribution financing arrangements
made with respect to the contracts will benefit the variable
account and investors in the contracts. The basis for such
conclusion is set forth in a memorandum which will be made
available to the SEC or its staff on request.
RETIREMENT PLANNING
You may have to save more for retirement because social security
and employee savings plans are estimated to cover only 40% of your
retirement savings. The remaining 60% must come from personal
<PAGE>
PAGE 39
investments, savings and other income.* One way to help save for
retirement is by purchasing a variable annuity. Variable annuity
sales have almost tripled in the last 4 years to over $52 billion
dollars.**
Sources:
* Social Security Administration
**LIMRA 1994 Individual Annuity Market Report
PROSPECTUS
The prospectus dated Oct. 31, 1995, is hereby incorporated in this
Statement of Additional Information by reference.
<PAGE>
PAGE 40
American Partners Life Insurance Company
a wholly owned subsidiary of IDS Life Insurance Company
American Partners Life Financial Information
The financial statements shown below are those of the insurance
company and not those of the Subaccounts. These financial
statements have been prepared on the basis of statutory accounting
practices. They are included in the prospectus for the purpose of
informing investors as to the financial condition of the insurance
company and its ability to carry out its obligations under the
variable annuity contracts.
AMERICAN PARTNERS LIFE INSURANCE COMPANY
BALANCE SHEETS - STATUTORY BASIS
<TABLE>
<CAPTION>
Dec. 31, Dec. 31,
ASSETS 1994 1993
(thousands)
<S> <C> <C>
Investments (Note 2):
Bonds (Market: 1994, $3,020; 1993, $8,044) $3,101 $7,860
Cash and short-term investments 3,632 962
Total cash and invested assets 6,733 8,822
Accrued investment income 144 98
Amounts due from brokers 2,200 -
Amounts recoverable from reinsurance assumed - 112
Total admitted assets $9,077 $9,032
===== =====
LIABILITIES AND CAPITAL AND SURPLUS
Liabilities:
Accrued taxes, licenses and fees $ 18 $ 12
Life insurance policy and contract claims - 123
Payable to parent, subsidiary and affiliates - 173
Asset valuation reserve (Note 1) 6 -
Total liabilities 24 308
Capital and surplus (Note 4):
Capital stock, $100 par value per share;
30,000 shares authorized,
25,000 issued and outstanding 2,500 2,500
Additional paid-in capital 4,543 4,543
Unassigned surplus 2,010 1,681
Total capital and surplus 9,053 8,724
Total liabilities and capital and surplus $9,077 $9,032
===== =====
See accompanying notes.
</TABLE>
<PAGE>
PAGE 41
American Partners Life Insurance Company
a wholly owned subsidiary of IDS Life Insurance Company
AMERICAN PARTNERS LIFE INSURANCE COMPANY
STATEMENTS OF OPERATIONS - STATUTORY BASIS
<TABLE>
<CAPTION>
Years ended Dec. 31,
1994 1993
(thousands)
<S> <C> <C>
Revenues:
Annuity considerations $ - $ 487
Net investment income (Note 2) 427 244
Reserve adjustment on reinsurance ceded - 49
Miscellaneous income - 9
Total revenues 427 789
Benefits and expenses:
Death and other benefits - 424
General insurance expenses 1 195
Insurance taxes, licenses and fees
excluding federal income taxes 28 13
Total benefits and expenses 29 632
Net gain from operations before federal income taxes 398 157
Federal income taxes (Note 3) 109 54
Net income $ 289 $ 103
===== =====
See accompanying notes.
<PAGE>
PAGE 42
American Partners Life Insurance Company
a wholly owned subsidiary of IDS Life Insurance Company
AMERICAN PARTNERS LIFE INSURANCE COMPANY
STATEMENTS OF CHANGES IN CAPITAL AND SURPLUS - STATUTORY BASIS
Years ended Dec. 31,
1994 1993
(thousands)
Capital and surplus at beginning of year $8,724 $8,553
Net income 289 103
Recapture of reinsurance by ceding company 46 -
Prior year adjustment to surplus - 46
Change in reserve on account of change in
valuation basis - 22
Increase in asset valuation reserve (6) -
Capital and surplus at end of year $9,053 $8,724
===== =====
See accompanying notes.
<PAGE>
PAGE 43
American Partners Life Insurance Company
a wholly owned subsidiary of IDS Life Insurance Company
AMERICAN PARTNERS LIFE INSURANCE COMPANY
STATEMENTS OF CASH FLOWS - STATUTORY BASIS
Years ended Dec. 31,
1994 1993
(thousands)
Annuity considerations $ - $ 487
Net investment income received, excluding
realized gains and lossess 425 274
Other income received 35 58
Contract benefits paid - (507)
Operating expenses paid to parent, subsidiary
and affiliates (172) -
Commissions, other expenses and taxes paid,
excluding federal income taxes (24) (216)
Federal income taxes paid (144) 17
Net cash provided by operations 120 113
Proceeds from bonds matured 4,750 2,870
Other cash provided - 95
Total cash provided 4,870 3,078
Cost of bonds acquired - (2,217)
Other cash applied (2,200) (90)
Total cash applied (2,200) (2,307)
Net increase in cash and short-term
investments 2,670 771
Cash and short-term investments at beginning of year 962 191
Cash and short-term investments at end of year $3,632 $ 962
===== =====
See accompanying notes.
</TABLE>
<PAGE>
PAGE 44
American Partners Life Insurance Company
a wholly owned subsidiary of IDS Life Insurance Company
AMERICAN PARTNERS LIFE INSURANCE COMPANY
NOTES TO FINANCIAL STATEMENTS - STATUTORY BASIS
($ thousands)
1. Summary of significant accounting policies
Nature of business
American Partners Life Insurance Company (the Company), formerly
National Pension Life, is a stock life insurance company
organized in 1981 under the laws of the State of Vermont and
redomisticated in Arizona. The Company is licensed to transact
insurance business in 46 states at Dec. 31, 1994. The Company
was acquired by IDS Life Insurance Company (IDS Life) from Mutual
of America Life Insurance Company in February 1994.
Basis of presentation
The Company is a wholly owned subsidiary of IDS Life Insurance
Company (IDS Life), which is a wholly owned subsidiary of
American Express Financial Corporation (formerly IDS Financial
Corporation). American Express Financial Corporation is a wholly
owned subsidiary of American Express Company. The accompanying
financial statements have been prepared on the basis of
accounting practices prescribed or permitted by the State of
Arizona. Such practices vary from generally accepted accounting
principles for stock life insurance companies primarily as
follows:
- - Bonds are carried at cost rather than being classified as
"available for sale" or "held to maturity" and carried at fair
value or cost, respectively.
- - Policy acquisition costs, such as commissions and other costs
related to acquiring new business, are expensed in the year
incurred, whereas premiums are recognized over the premium paying
period.
- - Reserves for future policy benefits on annuity policies are
based on assumptions recognized by the Arizona Department of
Insurance rather than the Company's expected mortality, interest
and withdrawals.
- - The asset valuation reserve is reported as a liability rather
than as surplus. Changes in this reserve are reported directly
in unassigned surplus.
- - Deferred income taxes are not provided for the effects of
timing differences in reporting income for financial and income
tax purposes.
<PAGE>
PAGE 45
American Partners Life Insurance Company
a wholly owned subsidiary of IDS Life Insurance Company
1. Summary of significant accounting policies (continued)
- - Net realized gains or losses resulting from changes in market
interest rates are deferred and amortized to investment income in
future periods.
- - Net unrealized gain or loss in the carrying value of bonds and
mortgage loans on real estate is reflected directly in unassigned
surplus.
Investments
Investment values have been determined in accordance
with methods adopted by the National Association of Insurance
Commissioners (NAIC). Bonds are carried at cost, adjusted where
appropriate for amortization of premiums and accretion of
discounts. When evidence indicates a decline, which is other than
temporary, in the underlying value or earning power of individual
investments, such investments are written down to a new cost basis
by a charge to income.
Realized investment gain or loss is determined on an identified
cost basis.
Statement of cash flows
The Company considers investments with a maturity at the date of
their acquisition of three months or less to be short-term
investments. These investments are carried principally at
amortized cost which approximates market value. Short-term
investments at Dec. 31, 1994 and 1993 amounted to $3,474 and
$858, respectively, and have been included in the caption cash
and short-term investments.
Premium revenue
Annuity considerations are recognized as revenue when received.
Federal income taxes
The Company is included in the consolidated federal income tax
return of American Express Company. The Company provides for
income taxes on a separate return basis, except that, under an
agreement between American Express Financial Corporation and
American Express Company, tax benefit is recognized for losses to
the extent they can be used on the consolidated tax return. It
is the policy of American Express Financial Corporation and its
subsidiaries that American Express Financial Corporation will
reimburse a subsidiary for any tax benefit.
<PAGE>
PAGE 46
American Partners Life Insurance Company
a wholly owned subsidiary of IDS Life Insurance Company
1. Summary of significant accounting policies (continued)
At Dec. 31, 1994, included in accrued taxes, licenses and fees is
$18 ultimately payable to American Express Company for federal
income taxes.
2. Investments
Market values of investments have been determined as prescribed
by the NAIC.
Net unrealized depreciation of bonds increased by $266 and
decreased by $63 for the years ended Dec. 31, 1994 and 1993,
respectively.
The amortized cost and market value of investments in U.S.
Government bonds carried at amortized cost at Dec. 31, are as
follows:
1994 1993
Amortized cost $3,101 $7,860
Gross unrealized gains - 185
Gross unrealized losses (81) (1)
Market value $3,020 $8,044
===== =====
All of the investments in bonds mature from one to five years at
Dec. 31, 1994. Expected maturities may differ from contractual
maturities because borrowers may have the right to call or prepay
obligations with or without call or prepayment penalties.
At Dec. 31, 1994, bonds carried at $1,678 were on deposit with
various states as required by law.
Net investment income for the years ended Dec. 31 is summarized
as follows:
1994 1993
Bonds $363 $463
Short-term investments 81 11
444 474
Less investment expenses 17 230
$427 $244
=== ===
At Dec. 31, 1994, investments in bonds and short-term investments
comprised 98 percent of the Company's total cash and invested
assets. Securities are rated by the Securities Valuation Office
of the NAIC. As of Dec. 31, 1994, 100 percent of the bond
portfolio was invested in investment-grade securities.
<PAGE>
PAGE 47
American Partners Life Insurance Company
a wholly owned subsidiary of IDS Life Insurance Company
3. Federal income taxes
The Company will file a regular corporate tax return for the year
ended Dec. 31. 1994. As of Dec. 31, 1993, the Company qualified
as a life insurance company for federal income tax purposes. As
such, the Company was subject to the Internal Revenue Code
provisions applicable to life insurance companies.
Increases (decreases) to the federal tax provision applicable to
pretax income (excluding amounts applicable to net realized
capital gains) based on the statutory rate are attributable to:
1994 1993
Provision Rate Provision Rate
Federal income tax
provision based on
the statutory rate $139 35.0% $54 35.0%
Increases (decreases) are
attributable to:
Taxes paid on behalf of
the Company by a former
affiliate (30) (7.5) - -
Federal income tax provision $109 27.5% $54 35.0%
=== ==== == ====
4. Capital and surplus
Capital and surplus available for distribution as dividends to
parent are limited to the Company's net gain from operations in
accordance with accounting practices prescribed by state
insurance regulatory authorities. Any dividend distributions
would require approval of the Arizona Department of Insurance.
The Company is required to maintain a minimum capital and surplus
of $600.
5. Reinsurance
As of Dec. 31, 1993, the Company had a modified coinsurance
agreement with an affiliate of Mutual of America. At Dec. 31,
1993, reserves reinsured under this agreement amounted to $1,100.
During 1993, premiums assumed amounted to $487 and claims
incurred amounted to $423. This agreement was terminated prior
to the purchase of the company by IDS Life in February 1994.
<PAGE>
PAGE 48
American Partners Life Insurance Company
a wholly owned subsidiary of IDS Life Insurance Company
Report of Independent Auditors
The Board of Directors
American Partners Life Insurance Company
We have audited the accompanying statutory basis balance sheets of
American Partners Life Insurance Company (a wholly owned subsidiary
of IDS Life Insurance Company) as of December 31, 1994 and the
related statutory basis statements of operations, changes in
capital and surplus, and cash flows for the year then ended. These
financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these
financial statements based on our audit. The financial statements
of American Partners Life Insurance Company for the year ended
December 31, 1993, were audited by other auditors whose report
dated February 21, 1994, expressed an unqualified opinion on those
statements.
We conducted our audit in accordance with generally accepted
auditing standards. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the
amounts and disclosures in the financial statements. An audit also
includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audit
provides a reasonable basis for our opinion.
As described in Note 1 to the financial statements, the Company
presents its financial statements in conformity with the accounting
practices prescribed or permitted by the Arizona Department of
Insurance that vary in some respects from generally accepted
accounting principles. The effects of these variances have not
been determined but we believe they are material.
In our opinion, because of the significance of the effects of the
matters described in the preceding paragraph, the financial
statements referred to above are not intended to and do not present
fairly, in conformity with generally accepted accounting
principles, the financial position of American Partners Life
Insurance Company at December 31, 1994 or the results of its
operations or its cash flows for the year then ended.
<PAGE>
PAGE 49
American Partners Life Insurance Company
a wholly owned subsidiary of IDS Life Insurance Company
However, in our opinion, the financial statements referred to above
present fairly, in all material respects, the financial position of
American Partners Life Insurance Company at December 31, 1994 and
the results of its operations and its cash flows for the year
then ended, in conformity with accounting practices prescribed or
permitted by the Arizona Department of Insurance.
Ernst & Young LLP
Minneapolis, Minnesota
May 19, 1995
<PAGE>
PAGE 50
American Partners Life Insurance Company
a wholly owned subsidiary of IDS Life Insurance Company
AMERICAN PARTNERS LIFE INSURANCE COMPANY
BALANCE SHEET - STATUTORY BASIS
(UNAUDITED)
<TABLE>
<CAPTION>
June 30,
ASSETS 1995
(thousands)
<S> <C>
Investments:
Bonds (Market: June 30, 1995, $6,231) $6,125
Cash and short-term investments 3,019
Total cash and invested assets 9,144
Accrued investment income 143
Amounts due from brokers -
Total admitted assets $9,287
=====
LIABILITIES AND CAPITAL AND SURPLUS
Liabilities:
General expenses due or accrued $ 2
Accrued taxes, licenses and fees 45
Remittances and items not allocated 40
Asset valuation reserve (Note 1) 6
Total liabilities 93
Capital and surplus:
Capital stock, $100 par value per share;
30,000 shares authorized,
25,000 issued and outstanding 2,500
Additional paid-in capital 4,543
Unassigned surplus 2,151
Total capital and surplus 9,194
Total liabilities and capital and surplus $9,287
=====
See accompanying notes.
</TABLE>
<PAGE>
PAGE 51
American Partners Life Insurance Company
a wholly owned subsidiary of IDS Life Insurance Company
AMERICAN PARTNERS LIFE INSURANCE COMPANY
STATEMENT OF OPERATIONS - STATUTORY BASIS
(UNAUDITED)
<TABLE>
<CAPTION>
Six month
period ended
June 30, 1995
(thousands)
<S> <C>
Revenues:
Annuity considerations $ -
Net investment income 258
Total revenues 258
Benefits and expenses:
General insurance expenses 41
Insurance taxes, licenses and fees
excluding federal income taxes 1
Total benefits and expenses 42
Net gain from operations before federal income taxes 216
Federal income taxes 75
Net income $ 141
=====
See accompanying notes.
<PAGE>
PAGE 52
American Partners Life Insurance Company
a wholly owned subsidiary of IDS Life Insurance Company
AMERICAN PARTNERS LIFE INSURANCE COMPANY
STATEMENT OF CHANGES IN CAPITAL AND SURPLUS - STATUTORY BASIS
(UNAUDITED)
Six month
period ended
June 30, 1995
(thousands)
Capital and surplus at beginning of period $9,053
Net income 141
Capital and surplus at end of period $9,194
=====
See accompanying notes.
<PAGE>
PAGE 53
American Partners Life Insurance Company
a wholly owned subsidiary of IDS Life Insurance Company
AMERICAN PARTNERS LIFE INSURANCE COMPANY
STATEMENT OF CASH FLOWS - STATUTORY BASIS
(UNAUDITED)
Six month
period ended
June 30, 1995
(thousands)
Net investment income received, excluding
realized gains and lossess $ 243
Commissions, other expenses and taxes paid,
excluding federal income taxes (40)
Federal income taxes paid (48)
Net cash provided by operations 155
Proceeds from bonds matured -
Other cash provided 2,240
Total cash provided 2,395
Cost of bonds acquired 3,008
Other cash applied -
Total cash applied (3,008)
Net decrease in cash and short-term
investments (613)
Cash and short-term investments at beginning of year $3,632
Cash and short-term investments at end of period $3,019
=====
See accompanying notes.
</TABLE>
<PAGE>
PAGE 54
American Partners Life Insurance Company
a wholly owned subsidiary of IDS Life Insurance Company
NOTES TO FINANCIAL STATEMENTS
June 30, 1995 ($ in thousands) (unaudited)
1. General
In the opinion of the management of American Partners Life
Insurance Company (the Company), the accompanying unaudited
financial statements contain all adjustments (consisting of
normal recurring adjustments) necessary to present fairly its
balance sheet as of June 30, 1995, statement of operations for the
six months ended June 30, 1995, statement of changes in capital and
surplus for the six months ended June 30, 1995, and statement of
cash flows for the six months ended June 30, 1995.
The Company is a wholly owned subsidiary of IDS Life Insurance
Company which is a wholly owned subsidiary of American Express
Financial Corporation. American Express Financial Corporation is
a wholly owned subsidiary of American Express Company. The
accompanying financial statements have been prepared on the basis
of accounting practices prescribed or permitted by the State of
Arizona.
2. Nature of business
The Company is a stock life insurance company licensed to transact
insurance business in 46 states.
3. Statement of cash flows
The Company considers investments with a maturity at the date of
their acquisition of three months or less to be short-term
investments. These investments are carried principally at
amortized cost which approximates market value.
<PAGE>
PAGE 55
PART C.
Item 24. Financial Statements and Exhibits
(a) Financial Statements included in Part B of this Registration
Statement:
American Partners Life Insurance Company:
Balance Sheets as of Dec. 31, 1994 and 1993;
Related statements of operations, changes in capital and
surplus cash flows for the years ended Dec. 31, 1994, and
1993;
Notes to Financial Statements.
Report of Independent Auditors dated May 19, 1995.
Balance Sheet (unaudited) as of June 30, 1995;
Related Statements of operations, changes in capital and
surplus and cash flows (unaudited) for the six months
ended June 30, 1995.
(b) Exhibits:
1. Consent in Writing in Lieu of Meeting of Board of Directors
establishing the APL Variable Annuity Account 1 dated
February 9, 1995, filed electronically as Exhibit 1 to
Registration Statement No. 33-57731 is incorporated herein by
reference.
2. Not applicable.
3. Form of Variable Annuity Distribution Agreement, filed
electronically as Exhibit 3 to Pre-Effective Amendment No. 1
to Registration Statement No. 33-57731 is incorporated herein
by reference.
4.1 Form of Deferred Annuity Contract for nonqualified contract
(form 32028), filed electronically as Exhibit 4.1 to Pre-
Effective Amendment No. 1 to Registration Statement No. 33-
57731 is incorporated herein by reference.
4.2 Form of Deferred Annuity Contract for qualified contract
(form 32034-IRA), filed electronically as Exhibit 4.2 to Pre-
Effective Amendment No. 1 to Registration Statement No. 33-
57731 is incorporated herein by reference.
5.1 Form of Application for American Partners Life Variable
Annuity (form 32025), filed electronically as Exhibit 5.1 to
Pre-Effective Amendment No. 1 to Registration Statement No.
33-57731 is incorporated herein by reference.
6.1 Articles of Amendment and Restatement of National Pension
Life Insurance Company dated February 18, 1994, filed as
Exhibit 6.1 to Registration Statement No. 33-57731 is
incorporated herein by reference.
6.2 Amended and Restated By-Laws of American Partners Life, filed
as Exhibit 6.2 to Registration Statement No. 33-57731 is
incorporated herein by reference.<PAGE>
PAGE 56
7. Not applicable.
8. Form of Participation Agreement, filed electronically as
Exhibit 8 to Pre-Effective Amendment No. 1 to Registration
Statement No. 33-57731 is incorporated herein by reference.
9. Opinion of counsel, filed electronically as Exhibit 9 to Pre-
Effective Amendment No. 1 to Registration Statement No. 33-
57731 is incorporated herein by reference.
10. Consent of Independent Auditors, filed electronically
herewith.
11. Report of Independent Auditors dated May 19, 1995, filed
electronically herewith.
12. Not applicable.
13. Copy of schedule for computation of each performance
quotation provided in the Registration Statement in response
to Item 21, filed as Exhibit 13 to Registration Statement No.
33-57731 is incorporated herein by reference.
14.1 Financial Data Schedule, filed electronically herewith.
14.2 Power of Attorney to sign this Registration Statement dated
Oct. 21, 1995, filed electronically herewith.
Item 25. Directors and Officers of the Depositor
<TABLE>
<CAPTION>
Positions and
Name Principal Business Address Offices with Depositor
<S> <C> <C>
Morris Goodwin Jr. IDS Tower 10 Vice President and Treasurer
Minneapolis, MN 55440
Lorraine R. Hart IDS Tower 10 Director and Vice President-
Minneapolis, MN 55440 Investments
Richard W. Kling IDS Tower 10 Director and Chairman
Minneapolis, MN 55440 of the Board
Stuart A. Sedlacek IDS Tower 10 Director and President
Minneapolis, MN 55440
F. Dale Simmons IDS Tower 10 Vice President-Real
Minneapolis, MN 55440 Estate Loan Management
William A. Stoltzmann IDS Tower 10 Director, Vice President,
Minneapolis, MN 55440 General Counsel and
Secretary
Melinda S. Urion IDS Tower 10 Director, Vice President
Minneapolis, MN 55440 and Controller
</TABLE>
<PAGE>
PAGE 57
Item 26. Persons Controlled by or Under Common Control with the
Depositor or Registrant
American Partners Life Insurance Company is a wholly
owned subsidiary of IDS Life Insurance Company which is
a wholly owned subsidiary of American Express Financial
Corporation. American Express Financial Corporation is
a wholly owned subsidiary of American Express Company
(American Express).
The following list includes the names of major
subsidiaries of American Express.
Jurisdiction
Name of Subsidiary of Incorporation
I. Travel Related Services
American Express Travel Related
Services Company, Inc. New York
II. International Banking Services
American Express Bank Ltd. Connecticut
III. Companies engaged in Investors
Diversified Financial Services
American Centurion Life Insurance Company New York
American Enterprise Investment Services Inc. Minnesota
American Enterprise Life Insurance Company Indiana
American Express Financial Advisors Inc. Delaware
American Express Financial Corporation Delaware
American Express Minnesota Foundation Minnesota
American Express Service Corporation Delaware
American Express Tax and Business Services Minnesota
American Express Trust Company Minnesota
American Partners Life Insurance Company Arizona
IDS Advisory Group Inc. Minnesota
IDS Aircraft Services Corporation Minnesota
IDS Cable Corporation Minnesota
IDS Cable II Corporation Minnesota
IDS Capital Holdings Inc. Minnesota
IDS Certificate Company Delaware
IDS Deposit Corp. Utah
IDS Fund Management Limited U.K.
IDS Futures Corporation Minnesota
IDS Futures III Corporation Minnesota
IDS Insurance Agency of Alabama Inc. Alabama
IDS Insurance Agency of Arkansas Inc. Arkansas
IDS Insurance Agency of Massachusetts Inc. Massachusetts
IDS Insurance Agency of Mississippi Inc. Mississippi
IDS Insurance Agency of Nevada Inc. Nevada
IDS Insurance Agency of New Mexico Inc. New Mexico
IDS Insurance Agency of North Carolina Inc. North Carolina
IDS Insurance Agency of Ohio Inc. Ohio
IDS Insurance Agency of Texas Inc. Texas
IDS Insurance Agency of Utah Inc. Utah
IDS Insurance Agency of Wyoming Inc. Wyoming<PAGE>
PAGE 58
IDS International, Inc. Delaware
IDS Life Insurance Company Minnesota
IDS Life Insurance Company of New York New York
IDS Management Corporation Minnesota
IDS Partnership Services Corporation Minnesota
IDS Plan Services of California, Inc. Minnesota
IDS Property Casualty Insurance Company Wisconsin
IDS Real Estate Services, Inc. Delaware
IDS Realty Corporation Minnesota
IDS Sales Support Inc. Minnesota
IDS Securities Corporation Delaware
Investors Syndicate Development Corp. Nevada
Item 27. Number of Contractowners
Not applicable.
Item 28. Indemnification
The By-Laws of the depositor provide that it shall
indemnify a director, officer, agent or employee of the
depositor pursuant to the provisions of applicable
statutes or pursuant to contract.
Insofar as indemnification for liability arising under
the Securities Act of 1933 may be permitted to director,
officers and controlling persons of the registrant
pursuant to the foregoing provisions, or otherwise, the
registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification
is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the
payment by the registrant of expenses incurred or paid by
a director, officer or controlling person of the
registrant in the successful defense of any action, suit
or proceeding) is asserted by such director, officer or
controlling person in connection with the securities
being registered, the registrant will, unless in the
opinion of its counsel the matter has been settled by
controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by
it is against public policy as expressed in the Act and
will be governed by the final adjudication of such issue.
Item 29. Principal Underwriters.
(a) American Expess Financial Advisors Inc. (formerly IDS
Financial Services Inc.) acts as principal underwriter
for the following investment companies:
IDS Bond Fund, Inc.; IDS California Tax-Exempt Trust; IDS
Discovery Fund, Inc.; IDS Equity Select Fund, Inc.; IDS Extra
Income Fund, Inc.; IDS Federal Income Fund, Inc.; IDS Global
Series, Inc.; IDS Growth Fund, Inc.; IDS High Yield Tax-Exempt
Fund, Inc.; IDS International Fund, Inc.; IDS Investment
Series, Inc.; IDS Managed Retirement Fund, Inc.; IDS Market
Advantage Series, Inc.; IDS Money Market Series, Inc.; IDS New
Dimensions Fund, Inc.; IDS Precious Metals Fund, Inc.; IDS <PAGE>
PAGE 59
Progressive Fund, Inc.; IDS Selective Fund, Inc.; IDS Special
Tax-Exempt Series Trust; IDS Stock Fund, Inc.; IDS Strategy
Fund, Inc.; IDS Tax-Exempt Bond Fund, Inc.; IDS Tax-Free Money
Fund, Inc.; IDS Utilities Income Fund, Inc. and IDS
Certificate Company.
<PAGE>
PAGE 60
(b) As to each director, officer or partner of the principal
underwriter:
Positions and
Name and Principal Position and Offices Offices with
Business Address with Underwriter Registrant
Ronald G. Abrahamson Vice President- None
IDS Tower 10 Service Quality and
Minneapolis, MN 55440 Reengineering
Douglas A. Alger Vice President-Total None
IDS Tower 10 Compensation
Minneapolis, MN 55440
Jerome R. Amundson Vice President- None
IDS Tower 10 Investment Accounting
Minneapolis, MN 55440
Peter J. Anderson Senior Vice President- None
IDS Tower 10 Investments
Minneapolis, MN 55440
Ward D. Armstrong Vice President- None
IDS Tower 10 Sales and Marketing,
Minneapolis, MN 55440 American Express
Institutional Services
Alvan D. Arthur Group Vice President- None
IDS Tower 10 Central California/
Minneapolis, MN 55440 Western Nevada
Joseph M. Barsky III Vice President-Senior None
IDS Tower 10 Portfolio Manager
Minneapolis, MN 55440
Robert C. Basten Vice President-Tax None
IDS Tower 10 and Business Services
Minneapolis, MN 55440
Timothy V. Bechtold Vice President-Risk None
IDS Tower 10 Management Products
Minneapolis, MN 55440
John D. Begley Group Vice President- None
Suite 100 Ohio/Indiana
7760 Olentangy River Rd.
Columbus, OH 43235
Carl E. Beihl Vice President- None
IDS Tower 10 Strategic Technology
Minneapolis, MN 55440 Planning
Jack A. Benjamin Group Vice President- None
Suite 200 Greater Pennsylvania
3500 Market Street
Camp Hill, PA 17011
<PAGE>
PAGE 61
Item 29(b). As to each director, officer or partner of the
principal underwriter (American Express Financial Advisors):
(cont'd)
Positions and
Name and Principal Position and Offices Offices with
Business Address with Underwriter Registrant
Alan F. Bignall Vice President- None
IDS Tower 10 Financial Planning
Minneapolis, MN 55440 Systems
Brent L. Bisson Group Vice President- None
Ste 900 e Westside Tower Los Angeles Metro
11835 West Olympic Blvd.
Los Angeles, CA 90064
John C. Boeder Vice President- None
IDS Tower 10 Mature Market Group
Minneapolis, MN 55440
Bruce J. Bordelon Group Vice President- None
Galleria One Suite 1900 Gulf States
Galleria Blvd.
Metairie, LA 70001
Charles R. Branch Group Vice President- None
Suite 200 Northwest
West 111 North River Dr
Spokane, WA 99201
Karl J. Breyer Senior Vice President- None
IDS Tower 10 Corporate Affairs and
Minneapolis, MN 55440 Special Counsel
Harold E. Burke Vice President None
IDS Tower 10 and Assistant
Minneapolis, MN 55440 General Counsel
Daniel J. Candura Vice President- None
IDS Tower 10 Marketing Support
Minneapolis, MN 55440
Cynthia M. Carlson Vice President- None
IDS Tower 10 American Express
Minneapolis, MN 55440 Securities Services
Orison Y. Chaffee III Vice President-Field None
IDS Tower 10 Real Estate
Minneapolis, MN 55440
James E. Choat Senior Vice President- None
IDS Tower 10 Field Management
Minneapolis, MN 55440
Kenneth J. Ciak Vice President and None
IDS Property Casualty General Manager-
1400 Lombardi Avenue IDS Property Casualty
Green Bay, WI 54304<PAGE>
PAGE 62
Item 29(b). As to each director, officer or partner of the
principal underwriter (American Express Financial Advisors):
(cont'd)
Positions and
Name and Principal Position and Offices Offices with
Business Address with Underwriter Registrant
Roger C. Corea Group Vice President- None
290 Woodcliff Drive Upstate New York
Fairport, NY 14450
Henry J. Cormier Group Vice President- None
Commerce Center One Connecticut
333 East River Drive
East Hartford, CT 06108
John M. Crawford Group Vice President- None
Suite 200 Arkansas/Springfield/Memphis
10800 Financial Ctr Pkwy
Little Rock, AR 72211
Kevin F. Crowe Group Vice President- None
Suite 312 Carolinas/Eastern Georgia
7300 Carmel Executive Pk
Charlotte, NC 28226
Alan R. Dakay Vice President- None
IDS Tower 10 Institutional Products
Minneapolis, MN 55440 Group
Regenia David Vice President- None
IDS Tower 10 Systems Services
Minneapolis, MN 55440
Scott M. Digiammarino Group Vice President- None
Suite 500 Washington/Baltimore
8045 Leesburg Pike
Vienna, VA 22182
Bradford L. Drew Group Vice President- None
Two Datran Center Eastern Florida
Penthouse One B
9130 S. Dadeland Blvd.
Miami, FL 33156
William H. Dudley Director and Executive None
IDS Tower 10 Vice President-
Minneapolis MN 55440 Investment Operations
Roger S. Edgar Senior Vice President None
IDS Tower 10 and Technology Advisor
Minneapolis, MN 55440
Gordon L. Eid Senior Vice President None
IDS Tower 10 and General Counsel
Minneapolis, MN 55440
<PAGE>
PAGE 63
Item 29(b). As to each director, officer or partner of the
principal underwriter (American Express Financial Advisors):
(cont'd)
Positions and
Name and Principal Position and Offices Offices with
Business Address with Underwriter Registrant
Robert M. Elconin Vice President- None
IDS Tower 10 Government Relations
Minneapolis, MN 55440
Mark A. Ernst Vice President- None
IDS Tower 10 Retail Services
Minneapolis, MN 55440
Joseph Evanovich Jr. Group Vice President- None
One Old Mill Nebraska/Iowa/Dakotas
101 South 108th Avenue
Omaha, NE 68154
Louise P. Evenson Group Vice President- None
Suite 200 San Francisco Bay Area
1333 N. California Blvd.
Walnut Creek, CA 94596
Gordon M. Fines Vice President- None
IDS Tower 10 Mutual Fund Equity
Minneapolis MN 55440 Investments
Louis C. Fornetti Senior Vice President Vice
IDS Tower 10 and Chief Financial President
Minneapolis, MN 55440 Officer
Douglas L. Forsberg Group Vice President- None
Suite 100 Portland/Eugene
7931 N. E. Halsey
Portland, OR 97213
William P. Fritz Group Vice President- None
Suite 160 Northern Missouri
12855 Flushing Meadows Dr
St. Louis, MO 63131
Carl W. Gans Group Vice President- None
8500 Tower Suite 1770 Twin City Metro
8500 Normandale Lake Blvd.
Bloomington, MN 55437
Robert G. Gilbert Vice President- None
IDS Tower 10 Real Estate
Minneapolis, MN 55440
John J. Golden Vice President- None
IDS Tower 10 Field Compensation
Minneapolis, MN 55440 Development
<PAGE>
PAGE 64
Item 29(b). As to each director, officer or partner of the
principal underwriter (American Express Financial Advisors):
(cont'd)
Positions and
Name and Principal Position and Offices Offices with
Business Address with Underwriter Registrant
Morris Goodwin Jr. Vice President and Vice
IDS Tower 10 Corporate Treasurer President &
Minneapolis, MN 55440 Treasurer
Suzanne Graf Vice President- None
IDS Tower 10 Systems Services
Minneapolis, MN 55440
Bruce M. Guarino Group Vice President- None
Suite 1736 Hawaii
1585 Kapiolani Blvd.
Honolulu, HI 96814
David A. Hammer Vice President None
IDS Tower 10 and Marketing
Minneapolis, MN 55440 Controller
Teresa A. Hanratty Group Vice President- None
Suites 6&7 Northern New England
169 South River Road
Bedford, NH 03110
John R. Hantz Group Vice President- None
Suite 107 Detroit Metro
17177 N. Laurel Park
Livonia, MI 48154
Robert L. Harden Group Vice President- None
Two Constitution Plaza Boston Metro
Boston, MA 02129
Lorraine R. Hart Vice President- None
IDS Tower 10 Insurance Investments
Minneapolis, MN 55440
Scott A. Hawkinson Vice President-Assured None
IDS Tower 10 Assets Product Development
Minneapolis, MN 55440 and Management
Brian M. Heath Group Vice President- None
Suite 250 North Texas
801 E. Campbell Road
Richardson, TX 75081
Raymond E. Hirsch Vice President-Senior None
IDS Tower 10 Portfolio Manager
Minneapolis, MN 55440
<PAGE>
PAGE 65
Item 29(b). As to each director, officer or partner of the
principal underwriter (American Express Financial Advisors):
(cont'd)
Positions and
Name and Principal Position and Offices Offices with
Business Address with Underwriter Registrant
James G. Hirsh Vice President and None
IDS Tower 10 Assistant General
Minneapolis, MN 55440 Counsel
David J. Hockenberry Group Vice President- None
30 Burton Hills Blvd. Eastern Tennessee
Suite 175
Nashville, TN 37215
Kevin P. Howe Vice President- None
IDS Tower 10 Government and
Minneapolis, MN 55440 Customer Relations
David R. Hubers Chairman, Chief None
IDS Tower 10 Executive Officer and
Minneapolis, MN 55440 President
Marietta L. Johns Senior Vice President- None
IDS Tower 10 Field Management
Minneapolis, MN 55440
Douglas R. Jordal Vice President-Taxes None
IDS Tower 10
Minneapolis, MN 55440
James E. Kaarre Vice President- None
IDS Tower 10 Marketing Information
Minneapolis, MN 55440
Linda B. Keene Vice President- None
IDS Tower 10 Market Development
Minneapolis, MN 55440
G. Michael Kennedy Vice President-Investment None
IDS Tower 10 Services and Investment
Minneapolis, MN 55440 Research
Susan D. Kinder Senior Vice President- None
IDS Tower 10 Human Resources
Minneapolis, MN 55440
Richard W. Kling Senior Vice President- Director,
IDS Tower 10 Risk Management Products Chairman &
Minneapolis, MN 55440 President
Paul F. Kolkman Vice President- None
IDS Tower 10 Actuarial Finance
Minneapolis, MN 55440
<PAGE>
PAGE 66
Item 29(b). As to each director, officer or partner of the
principal underwriter (American Express Financial Advisors):
(cont'd)
Positions and
Name and Principal Position and Offices Offices with
Business Address with Underwriter Registrant
Claire Kolmodin Vice President- None
IDS Tower 10 Service Quality
Minneapolis, MN 55440
David S. Kreager Group Vice President- None
Ste 108 Trestle Bridge V Greater Michigan
5136 Lovers Lane
Kalamazoo, MI 49002
Steven C. Kumagai Director and Senior None
IDS Tower 10 Vice President-Field
Minneapolis, MN 55440 Management and Business
Systems
Mitre Kutanovski Group Vice President- None
Suite 680 Chicago Metro
8585 Broadway
Merrillville, IN 48410
Edward Labenski Vice President- None
IDS Tower 10 Senior Portfolio
Minneapolis, MN 55440 Manager
Kurt A. Larson Vice President- None
IDS Tower 10 Senior Portfolio
Minneapolis, MN 55440 Manager
Lori J. Larson Vice President- None
IDS Tower 10 Variable Assets Product
Minneapolis, MN 55440 Development
Ryan R. Larson Vice President- None
IDS Tower 10 IPG Product Development
Minneapolis, MN 55440
Daniel E. Laufenberg Vice President and None
IDS Tower 10 Chief U.S. Economist
Minneapolis, MN 55440
Richard J. Lazarchic Vice President- None
IDS Tower 10 Senior Portfolio
MInneapolis, MN 55440 Manager
Peter A. Lefferts Senior Vice President- None
IDS Tower 10 Corporate Strategy and
Minneapolis, MN 55440 Development
<PAGE>
PAGE 67
Item 29(b). As to each director, officer or partner of the
principal underwriter (American Express Financial Advisors):
(cont'd)
Positions and
Name and Principal Position and Offices Offices with
Business Address with Underwriter Registrant
Douglas A. Lennick Director and Executive None
IDS Tower 10 Vice President-Private
Minneapolis, MN 55440 Client Group
Mary J. Malevich Vice President- None
IDS Tower 10 Senior Portfolio
Minneapolis, MN 55440 Manager
Fred A. Mandell Vice President- None
IDS Tower 10 Field Marketing Readiness
Minneapolis, MN 55440
Daniel E. Martin Group Vice President- None
Suite 650 Pittsburgh Metro
5700 Corporate Drive
Pittsburgh, PA 15237
William J. McKinney Vice President- None
IDS Tower 10 Field Management
Minneapolis, MN 55440 Support
Thomas W. Medcalf Vice President- None
IDS Tower 10 Senior Portfolio Manager
Minneapolis, MN 55440
William C. Melton Vice President- None
IDS Tower 10 International Research
Minneapolis, MN 55440 and Chief International
Economist
Janis E. Miller Vice President- Director
IDS Tower 10 Variable Assets
Minneapolis, MN 55440
James A. Mitchell Executive Vice President- None
IDS Tower 10 Marketing and Products
Minneapolis, MN 55440
John P. Moraites Group Vice President- None
Union Plaza Suite 900 Kansas/Oklahoma
3030 Northwest Expressway
Oklahoma City, OK 73112
Pamela J. Moret Vice President- None
IDS Tower 10 Corporate Communications
Minneapolis, MN 55440
Barry J. Murphy Senior Vice President- None
IDS Tower 10 Client Service
Minneapolis, MN 55440
<PAGE>
PAGE 68
Item 29(b). As to each director, officer or partner of the
principal underwriter (American Express Financial Advisors):
(cont'd)
Positions and
Name and Principal Position and Offices Offices with
Business Address with Underwriter Registrant
Robert J. Neis Vice President- None
IDS Tower 10 Information Systems
Minneapolis, MN 55440 Operations
Ronald E. Newton Group Vice President- None
319 Southbridge St. Rhode Island/Central
Auburn, MA 01501 Massachusetts
Thomas V. Nicolosi Group Vice President- None
Suite 220 New York Metro Area
500 Mamaronick Avenue
Harrison, NY 10528
James R. Palmer Vice President- None
IDS Tower 10 Insurance Operations
Minneapolis, MN 55440
Carla P. Pavone Vice President- None
IDS Tower 10 Specialty Service Teams
Minneapolis, MN 55440 and Emerging Business
George M. Perry Vice President- None
IDS Tower 10 Corporate Strategy
Minneapolis, MN 55440 and Development
Susan B. Plimpton Vice President- None
IDS Tower 10 Segmentation Development
Minneapolis, MN 55440 and Support
Larry M. Post Group Vice President- None
One Tower Bridge Philadelphia Metro
100 Front Street 8th Fl
West Conshohocken, PA 19428
Ronald W. Powell Vice President and None
IDS Tower 10 Assistant General
Minneapolis, MN 55440 Counsel
James M. Punch Vice President- None
IDS Tower 10 TransAction Services
Minneapolis, MN 55440
Frederick C. Quirsfeld Vice President-Taxable None
IDS Tower 10 Mutual Fund Investments
Minneapolis, MN 55440
<PAGE>
PAGE 69
Item 29(b). As to each director, officer or partner of the
principal underwriter (American Express Financial Advisors):
(cont'd)
Positions and
Name and Principal Position and Offices Offices with
Business Address with Underwriter Registrant
R. Daniel Richardson Group Vice President- None
Suite 800 Southern Texas
Arboretum Plaza One
9442 Capital of Texas Hwy N.
Austin, TX 78759
Roger B. Rogos Group Vice President- None
One Sarasota Tower Western Florida
Suite 700
Two N. Tamiami Trail
Sarasota, FL 34236
ReBecca K. Roloff Vice President-1994 None
IDS Tower 10 Program Director
Minneapolis, MN 55440
Stephen W. Roszell Vice President- None
IDS Tower 10 Advisory Institutional
Minneapolis, MN 55440 Marketing
Max G. Roth Group Vice President- None
Suite 201 S IDS Ctr Wisconsin/Upper Michigan
1400 Lombardi Avenue
Green Bay, WI 54304
Robert A. Rudell Vice President- None
IDS Tower 10 American Express
Minneapolis, MN 55440 Institutional Services
John P. Ryan Vice President and None
IDS Tower 10 General Auditor
Minneapolis, MN 55440
Erven A. Samsel Senior Vice President- None
IDS Tower 10 Field Management
Minneapolis, MN 55440
Russell L. Scalfano Group Vice President- None
Suite 201 Exec Pk East Illinois/Indiana/Kentucky
101 Plaza East Blvd.
Evansville, IN 47715
William G. Scholz Group Vice President- None
Suite 205 Arizona/Las Vegas
7333 E Doubletree Ranch Rd
Scottsdale, AZ 85258
Stuart A. Sedlacek Vice President- None
IDS Tower 10 Assured Assets
Minneapolis, MN 55440
<PAGE>
PAGE 70
Item 29(b). As to each director, officer or partner of the
principal underwriter (American Express Financial Advisors):
(cont'd)
Positions and
Name and Principal Position and Offices Offices with
Business Address with Underwriter Registrant
Donald K. Shanks Vice President- None
IDS Tower 10 Property Casualty
Minneapolis, MN 55440
F. Dale Simmons Vice President-Senior None
IDS Tower 10 Portfolio Manager,
Minneapolis, MN 55440 Insurance Investments
Judy P. Skoglund Vice President- None
IDS Tower 10 Human Resources and
Minneapolis, MN 55440 Organization Development
Julian W. Sloter Group Vice Presidnet- None
Ste 1700 Orlando FinCtr Orlando/Jacksonville
800 North Magnolia Ave.
Orlando, FL 32803
Ben C. Smith Vice President- None
IDS Tower 10 Workplace Marketing
Minneapolis, MN 55440
William A. Smith Vice President and None
IDS Tower 10 Controller-Private
Minneapolis, MN 55440 Client Group
James B. Solberg Group Vice President- None
IDS Tower 10 Eastern Iowa Area
Minneapolis, MN 55440
Bridget Sperl Vice President- None
IDS Tower 10 Human Resources
Minneapolis, MN 55440 Management Services
Paul J. Stanislaw Group Vice President- None
Suite 1100 Southern California
Two Park Plaza
Irvine, CA 92714
Lois A. Stilwell Group Vice President- None
Suite 433 Outstate Minnesota Area/
9900 East Brn Road North Dakota/Western Wisconsin
Minnetonka, MN 55343
William A. Stoltzmann Vice President and Gen'l Counsel
IDS Tower 10 Assistant General & Asst. Secry
Minneapolis, MN 55440 Counsel
James J. Strauss Vice President- None
IDS Tower 10 Corporate Planning
Minneapolis, MN 55440 and Analysis
<PAGE>
PAGE 71
Item 29(b). As to each director, officer or partner of the
principal underwriter (American Express Financial Advisors):
(cont'd)
Positions and
Name and Principal Position and Offices Offices with
Business Address with Underwriter Registrant
Jeffrey J. Stremcha Vice President-Information None
IDS Tower 10 Resource Management/ISD
Minneapolis, MN 55440
Neil G. Taylor Group Vice President- None
Suite 425 Seattle/Tacoma
101 Elliott Avenue West
Seattle, WA 98119
John R. Thomas Senior Vice President- None
IDS Tower 10 Information and
Minneapolis, MN 55440 Technology
Melinda S. Urion Vice President and Assistant
IDS Tower 10 Corporate Controller Secretary
Minneapolis, MN 55440
Peter S. Velardi Group Vice President- None
Suite 180 Atlanta/Birmingham
1200 Ashwood Parkway
Atlanta, GA 30338
Charles F. Wachendorfer Group Vice President- None
Suite 100 Denver/Salt Lake City/
Stanford Plaza II Albuquerque
7979 East Tufts Ave Pkwy
Denver, CO 80237
Wesley W. Wadman Vice President- None
IDS Tower 10 Senior Portfolio
Minneapolis, MN 55440 Manager
Norman Weaver Jr. Senior Vice President- None
1010 Main St Suite 2B Field Management
Huntington Beach, CA 92648
Michael L. Weiner Vice President- None
IDS Tower 10 Corporate Tax
Minneapolis, MN 55440 Operations
Lawrence J. Welte Vice President- None
IDS Tower 10 Investment Administration
Minneapolis, MN 55440
Jeffry M. Welter Vice President- None
IDS Tower 10 Equity and Fixed Income
Minneapolis, MN 55440 Trading
<PAGE>
PAGE 72
Item 29(b). As to each director, officer or partner of the
principal underwriter (American Express Financial Advisors):
(cont'd)
Positions and
Name and Principal Position and Offices Offices with
Business Address with Underwriter Registrant
William N. Westhoff Senior Vice President and None
IDS Tower 10 Global Chief Investment
Minneapolis, MN 55440 Officer
Thomas L. White Group Vice President- None
Suite 200 Cambridge Ct Cleveland Metro
28601 Chagrin Blvd.
Woodmere, OH 44122
Eric S. Williams Group Vice President- None
Suite 250 Virginia
3951 Westerre Parkway
Richmond, VA 23233
Edwin M. Wistrand Vice President and None
IDS Tower 10 Assistant General
Minneapolis, MN 55440 Counsel
Michael R. Woodward Senior Vice President- None
32 Ellicott St Ste 100 Field Management
Batavia, NY 14020
Item 30. Location of Accounts and Records
American Partners Life Insurance Company
80 South Eighth Street
Minneapolis, MN
Item 31. Management Services
Not Applicable
Item 32. Undertakings
(a)(b)&(c) These undertakings were filed with the Registrant's Pre-
Effective Amendment No. 1, File No. 33-57731.
<PAGE>
PAGE 73
SIGNATURES
As required by the Securities Act of 1933 and the Investment
Company Act of 1940, American Partners Life Insurance Company, on
behalf of the Registrant certifies that it meets all of the
requirements for effectiveness of this Amendment to its
Registration Statement pursuant to Rule 485(b) under the Securities
Act of 1933 and has duly caused this Amendment to its Registration
Statement to be signed on its behalf by the undersigned, thereunto
duly authorized in the City of Minneapolis, and State of Minnesota,
on the 25th day of October, 1995.
APL VARIABLE ANNUITY ACCOUNT 1
(Registrant)
By American Partners Life Insurance Company
(Sponsor)
By /s/ Richard W. Kling*
Richard W. Kling
Chairman of the Board
As required by the Securities Act of 1933, this Registration
Statement has been signed by the following persons in the
capacities indicated on the 25th day of October, 1995.
Signature Title
/s/ Richard W. Kling* Director and Chairman of
Richard W. Kling the Board
/s/ Stuart A. Sedlacek Director and President
Stuart A. Sedlacek
/s/ Lorraine R. Hart* Director and Vice President
Lorraine R. Hart
/s/ William A. Stoltzmann* Director, Vice President,
William A. Stoltzmann General Counsel and
Secretary
/s/ Melinda S. Urion* Director, Vice President
Melinda S. Urion and Controller
*Signed pursuant to Power of Attorney, filed electronically
herewith.
______________________________
Mary Ellyn Minenko
<PAGE>
PAGE 74
CONTENTS OF THIS POST-EFFECTIVE AMENDMENT NO. 1
TO REGISTRATION STATEMENT NO. 33-57731
This Registration Statement is comprised of the following papers
and documents:
The Cover Page.
Cross-reference sheet.
Part A.
The prospectus.
Part B.
Statement of Additional Information.
Financial Statements.
Part C.
Other Information.
The signatures.
Exhibits.
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PAGE 1
APL Variable Annuity Account 1
File No. 33-57731/812-9484
EXHIBIT INDEX
Exhibit 10: Consent of Independent Auditors.
Exhibit 11: Report of Independent Auditors dated May 19, 1995.
Exhibit 14.1: Financial Data Schedule.
Exhibit 14.2: Power of Attorney.
<PAGE>
PAGE 1
Consent of Independent Auditors
We consent to the reference to our firm under the caption
"Independent Auditors" and to the use of our report dated May 19,
1995 on the statutory basis financial statements of American
Partners Life Insurance Company (a wholly-owned subsidiary of IDS
Life Insurance Company) for the APL Variable Annuity Account 1 to
be offered by the American Partners Life Insurance Company, in
Post-Effective Amendment No. 1 to the Registration Statement (Form
N-4 File No. 33-57731) being filed under the Securities Act of 1933
and (Form N-4 File No. 812-9484) being filed under the Investment
Company Act of 1940.
Ernst & Young LLP
Minneapolis, Minnesota
October 25, 1995
<PAGE>
PAGE 1
American Partners Life Insurance Company
a wholly owned subsidiary of IDS Life Insurance Company
Report of Independent Auditors
The Board of Directors
American Partners Life Insurance Company
We have audited the accompanying statutory basis balance sheets of
American Partners Life Insurance Company (a wholly owned subsidiary
of IDS Life Insurance Company) as of December 31, 1994 and the
related statutory basis statements of operations, changes in
capital and surplus, and cash flows for the year then ended. These
financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these
financial statements based on our audit. The financial statements
of American Partners Life Insurance Company for the year ended
December 31, 1993, were audited by other auditors whose report
dated February 21, 1994, expressed an unqualified opinion on those
statements.
We conducted our audit in accordance with generally accepted
auditing standards. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the
amounts and disclosures in the financial statements. An audit also
includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audit
provides a reasonable basis for our opinion.
As described in Note 1 to the financial statements, the Company
presents its financial statements in conformity with the accounting
practices prescribed or permitted by the Arizona Department of
Insurance that vary in some respects from generally accepted
accounting principles. The effects of these variances have not
been determined but we believe they are material.
In our opinion, because of the significance of the effects of the
matters described in the preceding paragraph, the financial
statements referred to above are not intended to and do not present
fairly, in conformity with generally accepted accounting
principles, the financial position of American Partners Life
Insurance Company at December 31, 1994 or the results of its
operations or its cash flows for the year then ended.
<PAGE>
PAGE 2
American Partners Life Insurance Company
a wholly owned subsidiary of IDS Life Insurance Company
However, in our opinion, the financial statements referred to above
present fairly, in all material respects, the financial position of
American Partners Life Insurance Company at December 31, 1994 and
the results of its operations and its cash flows for the year
then ended, in conformity with accounting practices prescribed or
permitted by the Arizona Department of Insurance.
Ernst & Young LLP
Minneapolis, Minnesota
May 19, 1995
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
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<PAGE>
<ARTICLE> 7
<CIK> 0040937690
<NAME> American Partners Life Insurance Company
<MULTIPLIER> 1000
<CURRENCY> U.S. DOLLAR
<FISCAL-YEAR-END> DEC-31-1993 DEC-31-1995
<PERIOD-START> JAN-01-1994 JAN-01-1995
<PERIOD-END> DEC-31-1994 JUNE-31-1995
<PERIOD-TYPE> YEAR 6 MONTH
<EXCHANGE-RATE> 1 1
<DEBT-HELD-FOR-SALE> 0 0
<DEBT-CARRYING-VALUE> 3101 6125
<DEBT-MARKET-VALUE> 3020 6231
<EQUITIES 0 0
<REAL ESTATE 0 0
<TOTAL-INVEST> 3101 6125
<CASH> 3632 3019
<RECOVER-REINSURE> 0 0
<DEFERRED-ACQUISITION> 0 0
<TOTAL-ASSETS> 9077 9287
<POLICY-LOSSES> 0 0
<UNEARNED-PREMIUMS> 0 0
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<POLICY-HOLDER-FUNDS> 0 0
<NOTES-PAYABLE> 0 0
<COMMON> 2500 2500
0 0
0 0
<OTHER-SE> 6553 6694
<TOTAL-LIABILITY-AND-EQUITY> 9077 9287
0 0
<INVESTMENT-INCOME> 427 258
<INVESTMENT-GAINS> 0 0
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<BENEFITS> 29 42
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<INCOME-PRETAX> 398 216
<INCOME-TAX> 109 75
<INCOME-CONTINUING> 289 141
<DISCONTINUED> 0 0
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> 289 141
<EPS-PRIMARY> 0 0
<EPS-DILUTED> 0 0
<RESERVE-OPEN> 0 0
<PROVISION-CURRENT> 0 0
<PROVISION-PRIOR> 0 0
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</TABLE>
<PAGE>
PAGE 1
AMERICAN PARTNERS LIFE INSURANCE COMPANY
Variable Annuity Contract
POWER OF ATTORNEY
City of Minneapolis
State of Minnesota
Each of the undersigned, as a director of American Partners Life
Insurance Company (APL), sponsor of the unit investment trust
consisting of the APL Variable Annuity Account 1 in connection with
the filing of a registration statement on Form N-4 under the
Securities Act of 1933 and the Investment Company Act of 1940,
hereby constitutes and appoints William A. Stoltzmann, Mary Ellyn
Minenko and Colleen Curran or any one of them, as his/her attorney-
in-fact and agent, to sign for him/her in his/her name, place and
stead any and all filings, applications (including applications for
exemptive relief), periodic reports, registration statements (with
all exhibits and other documents required or desirable in
connection therewith), other documents, and amendments thereto and
to file such filings, applications periodic reports, registration
statements, other documents, and amendments thereto with the
Securities and Exchange Commission, and any necessary states, and
grants to any or all of them the full power and authority to do and
perform each and every act required or necessary in connection
therewith.
/s/ Lorraine R. Hart Oct. 19, 1995
Lorraine R. Hart
/s/ Richard W. Kling Oct. 21, 1995
Richard W. Kling
/s/ Stuart A. Sedlacek Oct. 19, 1995
Stuart A. Sedlacek
/s/ William A. Stoltzmann Oct. 21, 1995
William A. Stoltzmann
/s/ Melinda S. Urion Oct. 19, 1995
Melinda S. Urion
