ACACIA NATIONAL VARIABLE LIFE INSURANCE SEPARATE ACCOUNT 1, 485BPOS, 2000-04-28

ACACIA NATIONAL VARIABLE LIFE INSURANCE SEPARATE ACCOUNT 1
485BPOS, 2000-04-28

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<PAGE> 1

As filed with the Securities and Exchange Commission on
April 28, 2000

Registration No. 33-90208
======================================================

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
---------------

Post-Effective Amendment No. 8
to

Form S-6
---------------

FOR REGISTRATION UNDER THE SECURITIES ACT OF 1933 OF
SECURITIES OF UNIT INVESTMENT TRUSTS REGISTERED ON
FORM N-8B-2
----------------
Acacia National Variable Life Insurance
Separate Account I
(Exact Name of Registrant)
----------------
Acacia National Life Insurance Company
(Depositor)
7315 Wisconsin Avenue Bethesda, MD 20814
----------------
Robert-John H. Sands Senior Vice President, Corporate Secretary and General
Counsel
Acacia National Life Insurance Company
7315 Wisconsin Avenue
Bethesda, MD 20855
-----------------

Title of Securities Being Registered: Securities of Unit Investment Trust

Approximate Date Of Proposed Public offering: As soon as practicable
after effective date.

It is proposed that this filing will become effective:

Immediately upon filing pursuant to paragraph (b).

[X] On May 1, 2000 pursuant to paragraph (b).

60 days after filing pursuant to paragraph (a)(1).

On pursuant to paragraph (a)(1) of Rule 485.

<PAGE> 2

RECONCILIATION AND TIE BETWEEN ITEMS IN FORM N-8B-2
AND THE PROSPECTUS

ITEM NO. OF
FORM N-8B-2 CAPTION IN PROSPECTUS
----------- ---------------------
<S> <C>
1 Cover Page
2 Cover Page
3 Not Applicable
4 Distribution of the Policies
5 Acacia National Variable Life Insurance Separate Account I
6 Acacia National Variable Life Insurance Separate Account I
7 Not Required
8 Not Required
9 Legal Proceedings
10 Summary; Addition, Deletion of Substitution of Investments; Policy Benefits;
Policy Rights; Payment and Allocation of Premiums; General Provisions; Voting
Rights
11 Summary; The Funds
12 Summary; The Funds
13 Summary; The Funds - Charges and Deductions
14 Summary; Payment and Allocation of Premiums
15 Summary; Payment and Allocation of Premiums
16 Summary; The Alger American Fund, Calvert
Variable Series, Inc, Deutsche Asset Management
VIT Funds, Variable Insurance Products Fund,
Variable Insurance Products Fund II, Franklin
Templeton Variable Insurance Products Trust,
Neuberger Berman Advisers Management Trust,
Oppenheimer Variable Account Funds., and Van
Eck Worldwide Insurance Trust
17 Summary, Policy Rights
18 The Alger American Fund, Calvert Variable
Series, Inc, Deutsche Asset Management VIT
Funds, Variable Insurance Products Fund,
Variable Insurance Products Fund II, Franklin
Templeton Variable Insurance Products Trust,
Neuberger Berman Advisers Management Trust,
Oppenheimer Variable Account Funds, and Van Eck
Worldwide Insurance Trust
19 General Provisions; Voting Rights
20 Not Applicable
21 Summary; Policy Rights, Loan Benefits; General Provisions
22 Not Applicable
23 Safekeeping of the Separate Account's Assets
24 General Provisions
25 Acacia National Life Insurance Company
26 Not Applicable
27 Acacia National Life Insurance Company
28 Executive Officers and Directors of ANLIC; Acacia National Life Insurance
Company
29 Acacia National Life Insurance Company
30 Not Applicable
31 Not Applicable
32 Not Applicable
33 Not Applicable
34 Not Applicable
35 Not Applicable
36 Not Required
37 Not Applicable
38 Distribution of the Policies
39 Distribution of the Policies
40 Distribution of the Policies
41 Distribution of the Policies

</TABLE>

<PAGE> 3

ITEM NO. OF
FORM N-8B-2 CAPTION IN PROSPECTUS
------------ ---------------------
<S> <C>
42 Not Applicable
43 Not Applicable
44 Cash Value, Payment and Allocation of Premium
45 Not Applicable
46 The Funds; Cash Value
47 The Funds
48 State Regulation of ANLIC
49 Not Applicable
50 The Separate Account
51 Cover Page; Summary; Policy Benefits; Payment and Allocation of Premiums,
Charges and Deductions
52 Addition, Deletion or Substitution of Investments
53 Summary; Federal Tax Matters
54 Not Applicable
55 Not Applicable
56 Not Required
57 Not Required
58 Not Required
59 Financial Statements

</TABLE>
<PAGE> 4

PROSPECTUS
[THE ACACIA GROUP LOGO]
Acacia National Life
Insurance Company

Allocator 2000 -- A Flexible Premium Variable Universal Life 7315 Wisconsin
Avenue

Insurance Policy issued by Acacia National Life Insurance Company Bethesda, MD
20814
- --------------------------------------------------------------------------------

Allocator 2000 is a flexible premium variable universal life insurance
Policy ("Policy"), issued by Acacia National Life Insurance Company ("ANLIC").
Like traditional life insurance policies, an Allocator 2000 Policy provides
Death Benefits to Beneficiaries and gives you, the Policyowner, the opportunity
to increase the Policy's cash value. Unlike traditional policies, Allocator 2000
lets you vary the frequency and amount of premium payments, rather than follow a
fixed premium payment schedule. It also lets you choose one of two Death Benefit
options: (1) a level amount, which generally equals the Face Amount of the
Policy; or (2) a variable amount which generally equals the Face Amount plus the
Policy Account Value. While the Policy remains in force, the Death Benefit will
not be less than the maximum of the current Face Amount of the Policy or the
Policy Account Value multiplied by the applicable corridor percentage specified
in the Policy. The minimum face amount is $25,000.

An Allocator 2000 Policy is different from traditional life insurance
policies in another important way: you select how Policy premiums will be
invested. Although each Policyowner is guaranteed a minimum death benefit, the
cash value of the Policy, as well as the actual Death Benefit, will vary with
the performance of investments you select.

The Investment Options available through Allocator 2000 include investment
portfolios from The Alger American Fund, Calvert Variable Series, Inc., Deutsche
Asset Management VIT Funds, Variable Insurance Products Fund, Variable Insurance
Products Fund II, Franklin Templeton Variable Insurance Products Trust,
Neuberger Berman Advisers Management Trust, Oppenheimer Variable Account Funds,
and Van Eck Worldwide Insurance Trust. Each of these portfolios has its own
investment objective and policies. These are described in the prospectuses for
each investment portfolio which must accompany this Allocator 2000 prospectus.
You may also choose to allocate premium payments to the Fixed Account managed by
ANLIC.

An Allocator 2000 Policy will be issued after ANLIC accepts a prospective
Policyowner's application. Allocator 2000 Policies are available to cover
individuals between the ages of 20 and 80 at the time of purchase. An Allocator
2000 Policy, once purchased, may generally be canceled until 20 days after the
Owner receives the Policy or 45 days after completion of Part I of the
application, if later.

This Allocator 2000 prospectus is designed to assist you in understanding
the opportunity and risks associated with the purchase of an Allocator 2000
Policy. Prospective Policyowners are urged to read the prospectus carefully and
retain it for future reference.

This prospectus includes a summary of the most important features of the
Allocator 2000 Policy, information about ANLIC, a list of the investment
portfolios to which you may allocate premium payments, and a detailed
description of the Allocator 2000 Policy. The appendix to the prospectus
includes tables designed to illustrate how cash values and death benefits may
change with the investment experience of the Investment Options.

This prospectus must be accompanied by a prospectus for each of the
investment portfolios available through Allocator 2000. Although the Allocator
2000 Policy is designed to provide life insurance, an Allocator 2000 Policy is
considered to be a security. The purchase of an Allocator 2000 Policy involves
investment risk, including the possible loss of principal. For this reason,
Allocator 2000 may not be suitable for all individuals. It may not be
advantageous to purchase an Allocator 2000 Policy as a replacement for another
type of life insurance or as a way to obtain additional insurance protection if
the purchaser already owns another flexible premium variable universal life
insurance policy. This Policy may not be available in all states.

The Securities and Exchange Commission maintains a web site
(http://www.sec.gov) that contains other information regarding registrants that
file electronically with the Securities and Exchange Commission.

NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
REGULATORY AUTHORITY HAS APPROVED THESE SECURITIES, OR DETERMINED THAT THIS
PROSPECTUS IS ACCURATE OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.

The Date of This Prospectus is May 1, 2000.

ALLOCATOR 2000
1
<PAGE> 5

TABLE OF CONTENTS

<TABLE>
<CAPTION>
PAGE
<S> <C>
GLOSSARY OF DEFINED TERMS................................... 3
SUMMARY..................................................... 5
QUESTIONS AND ANSWERS ABOUT YOUR POLICY..................... 6
ANLIC AND THE VARIABLE ACCOUNT.............................. 11
Acacia National Life Insurance Company................ 11
The Variable Account.................................. 12
THE PORTFOLIOS.............................................. 12
The Alger American Fund............................... 13
Calvert Variable Series, Inc.......................... 13
Deutsche Asset Management VIT Funds................... 14
Variable Insurance Products Fund, Variable Insurance
Products Fund II..................................... 15
Franklin Templeton Variable Insurance Products
Trust................................................ 15
Neuberger Berman Advisers Management Trust............ 16
Oppenheimer Variable Account Funds.................... 16
Van Eck Worldwide Insurance Trust..................... 17
Resolving Material Conflicts.......................... 18
Addition, Deletion, or Substitution of Investments.... 18
POLICY BENEFITS............................................. 19
Death Benefits........................................ 19
Applicable Percentage Table........................... 20
Payment of Policy Benefits............................ 22
PAYMENT AND ALLOCATION OF PREMIUMS.......................... 23
Policy Issue.......................................... 23
Premiums.............................................. 23
Allocation of Premiums and Policy Account Value....... 24
Transfers............................................. 24
Policy Lapse and Reinstatement........................ 25
CHARGES AND DEDUCTIONS...................................... 26
Surrender Charge...................................... 26
Partial Surrender Charge.............................. 26
Premium Expense Charges............................... 26
Policy Account Value Charges.......................... 27
Daily Charges Against the Variable Account............ 27
Investment Advisory Fee............................... 28
Reduction of Charges.................................. 28
POLICY RIGHTS............................................... 28
Loan Privileges....................................... 28
Surrender Privileges.................................. 29
Partial Surrender..................................... 29
Coverage Beyond the Maturity Date..................... 30
EXAMINATION OF THE POLICY PRIVILEGE ("FREE LOOK")........... 30
GENERAL ACCOUNT............................................. 30
General Description................................... 30
The Policy............................................ 31
General Account Value................................. 31
GENERAL POLICY PROVISIONS................................... 31
Postponement of Payments.............................. 31
The Contract.......................................... 31
Suicide............................................... 31
Incontestability...................................... 32
Change of Owner or Beneficiary........................ 32
Collateral Assignment................................. 32
Misstatement of Age or Sex............................ 32
Reports and Records................................... 32
Optional Insurance Benefits........................... 32
FEDERAL TAX CONSIDERATIONS.................................. 33
Introduction.......................................... 33
POLICIES ISSUED IN CONJUNCTION WITH EMPLOYEE BENEFIT
PLANS..................................................... 36
LEGAL DEVELOPMENTS REGARDING UNISEX ACTUARIAL TABLES........ 37
VOTING RIGHTS............................................... 37
EXECUTIVE OFFICERS AND DIRECTORS OF ANLIC................... 38
DISTRIBUTION OF THE POLICIES................................ 39
ADMINISTRATION.............................................. 39
YEAR 2000................................................... 39
POLICY REPORTS.............................................. 40
STATE REGULATION............................................ 40
EXPERTS..................................................... 40
LEGAL MATTERS............................................... 41
ADDITIONAL INFORMATION...................................... 41
FINANCIAL STATEMENTS
Acacia National Variable Life Insurance Separate
Account I............................................ F-I-1
Acacia National Life Insurance Company................ F-II-1
APPENDIX A -- ILLUSTRATIONS................................. A-1
APPENDIX B -- AUTOMATIC REBALANCING, MODEL ASSET ALLOCATION,
AND DOLLAR COST AVERAGING PROGRAMS........................ B-1
</TABLE>

ALLOCATOR 2000
2
<PAGE> 6

GLOSSARY OF DEFINED TERMS

ATTAINED AGE - The age of the Insured on the last Policy Anniversary.

BENCHMARK PREMIUM - A monthly premium based on the original face amount and any
increase made during the first sixty months that the Policy is in force. During
the first sixty months that the Policy is in force, the Policy is guaranteed not
to lapse provided the sum of the premiums paid equals or exceeds the sum of the
scheduled Benchmark Premiums since the Policy date and any Increase date.

BENEFICIARY - The Beneficiary is designated by the Owner to receive the Death
Benefit proceeds. If changed, the Beneficiary is as shown in the latest change
filed with ANLIC. If no Beneficiary survives the Insured, the Owner or the
Owner's estate will be the Beneficiary. The interest of any Beneficiary is
subject to that of any assignee.

CASH SURRENDER VALUE - The Policy Account Value minus any applicable surrender
charges, minus any outstanding indebtedness and due charges.

DEATH BENEFIT - The amount of insurance coverage provided under the selected
Death Benefit option of the Policy.

DEATH BENEFIT PROCEEDS - The proceeds payable to the Beneficiary upon receipt by
ANLIC of Satisfactory Proof of Death of the Insured while the Policy is in
force. It is equal to: (l) the Death Benefit; (2) plus additional life insurance
proceeds provided by any riders; (3) minus any Outstanding Policy Debt; (4)
minus any Accrued Expense Charges, including the Monthly Deduction for the month
of the Death of the Insured.

DUE PROOF OF DEATH - One of the following:
(a) A copy of a certified death certificate.
(b) A copy of a certified decree of a court of competent jurisdiction as to the
finding of death.
(c) A written statement by a medical doctor who attended the insured.
(d) Any other proof satisfactory to ANLIC.

FACE AMOUNT - The minimum death benefit payable under the Policy so long as the
Policy remains in force. The death benefit proceeds will be reduced by any
outstanding indebtedness and any due and unpaid charges.

FIXED ACCOUNT - The portion of the Policy Account Value allocated to our General
Account.

FREE LOOK PERIOD - The period of time in which the Owner may cancel the Policy
and receive a refund of the total premiums paid. The Owner may cancel the Policy
within 20 days of receipt of the Policy and free look notice, or 45 days after
completion of Part 1 of the application, whichever is later. This provision also
applies in the event of an increase in coverage.

GENERAL ACCOUNT - The assets of ANLIC other than those allocated to the Variable
Account or any other separate account.

GRACE PERIOD - The 62 days allowed from the mailing of the notice of the start
of the Grace Period until the date the Policy will Lapse for non payment of
premium.

GUARANTEED DEATH BENEFIT PREMIUM ("GDBP") - An annual premium listed in the
Policy, based on the Insured's age, sex, rate class and amount of insurance
coverage at the time of issue. Provided GDBP is paid and the Owner does not
elect to take any loans or partial surrenders, the Policy is guaranteed not to
lapse before the Insured's age 65 or for ten years from the effective date of
coverage, whichever is later.

INDEBTEDNESS - The sum of all unpaid Policy loans and accrued interest on loans.

ISSUE AGE - The Insured's age on the Policy Date.

INSURED - The person upon whose life the Policy is issued.

INVESTMENT OPTIONS - The Fixed Account and the Sub-accounts which invest in
portfolios described in the Fund prospectuses.

ALLOCATOR 2000
3
<PAGE> 7

LOAN VALUE - The maximum amount that may be borrowed under the Policy. The loan
value equals 90% of the Policy's Cash Surrender Value.

MATURITY DATE - The Policy Anniversary following the Insured's 95th birthday.

MONTHLY ANNIVERSARY - The same date in each succeeding month as the Policy Date.
For purposes of the Variable Account, whenever the Monthly Anniversary falls on
a date other than a Valuation Date, the Monthly Anniversary will be deemed the
next Valuation Date.

NET PREMIUM - Premium paid less the Premium Expense Charge.

OWNER - The Policy Owner as defined below.

PLANNED PERIODIC PREMIUM - A scheduled premium of a level amount at a fixed
interval over a specified period of time.

POLICY - The Flexible Premium Variable Life Insurance Policy offered by ANLIC
and described in this Prospectus.

POLICY ACCOUNT VALUE - The sum of the Policy's values in the Sub-accounts and
the General Account.

POLICY DATE - The date set forth in the Policy that is used to determine Policy
years and Policy months. Policy anniversaries are measured from the Policy Date.

POLICY MONTH - A month beginning on the Monthly Anniversary.

POLICY OWNER ("OWNER") - The person so designated in the Application or as
subsequently changed. If a Policy has been absolutely assigned, the assignee is
the Owner. A collateral assignee is not the Owner.

PORTFOLIO - A separate investment portfolio of a mutual fund in which the
Variable Account assets are invested.

PREMIUM EXPENSE CHARGE - A charge to cover all premium taxes imposed by the
states and any subdivision thereof, which does not necessarily relate to the
premium taxes paid for a particular Policy.

SUB-ACCOUNT - A sub-division of the Variable Account. Each Sub-account invests
exclusively in the shares of a specified Portfolio of a Fund.

SURRENDER CHARGE - The amount deducted from the Policy Account Value upon lapse
or surrender of the Policy during the first 9 years that the original Policy
coverage is effective and during the first 9 years from the effective date of an
increase.

TARGET PREMIUM - An annual premium amount based upon the Face Amount and the
Insured's age, sex and risk class that is used to calculate surrender charges
and agent compensation.

VALUATION DATE - Each regular business day that ANLIC and the New York Stock
Exchange are open for business, excluding holidays, and any other day in which
there is sufficient trading in the Fund's portfolio securities to materially
affect the value of the assets in the Variable Account.

VALUATION PERIOD - The period between two successive Valuation Dates, commencing
at the close of business of a Valuation Date and ending at the close of business
on the next succeeding Valuation Date.

VARIABLE ACCOUNT (OR "SEPARATE ACCOUNT I") - Acacia National Variable Life
Insurance Separate Account I, a separate investment account established by ANLIC
to receive and invest the net premiums paid under the Policy.

ALLOCATOR 2000
4
<PAGE> 8

SUMMARY

The following summary of prospectus information and diagram of the Policy
should be read along with the detailed information found elsewhere in this
prospectus. Unless stated otherwise, this prospectus assumes that the Policy is
in force and that there is no outstanding Policy debt.

DIAGRAM OF POLICY

- ---------------------------------------------------

PREMIUM PAYMENTS

You can vary amount and frequency.

- ---------------------------------------------------

- --------------------------------------------------------------------------------

DEDUCTIONS FROM PREMIUMS

Premium Expense Charge -- 2.25%

- --------------------------------------------------------------------------------

NET PREMIUM

The net premium may be invested in the Fixed Account or in Separate Account I
which offers 25 different Subaccounts. The Subaccounts invest in the
corresponding portfolios of The Alger American Fund, Calvert Variable Series,
Inc., Deutsche Asset Management VIT Funds, Variable Insurance Products Fund,
Variable Insurance Product Fund II, Franklin Templeton Variable Insurance
Products Trust, Neuberger Berman Advisers Management Trust, Oppenheimer
Variable Account Funds, and Van Eck Worldwide Insurance Trust.

- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------

DEDUCTIONS FROM ASSETS

Monthly Charge for Cost of Insurance and cost of any riders. The charge varies
by the face amount of the Policy, the Policy duration and the Issue Age,
gender, smoker distinction and risk class of the Insured. (See the Policy
Schedule for rates.)

Monthly per Policy charge for administrative expenses:

<TABLE>
<CAPTION>
POLICY YEAR MONTHLY CHARGE
----------- --------------
<S> <C>
1 $27.00
2+ $ 8.00
</TABLE>

Daily charge from the Subaccounts (not deducted from the Fixed Account):

Mortality and Expense Risk Charge:

<TABLE>
<CAPTION>
POLICY YEAR ANNUAL CHARGE
----------- ----------------
<S> <C>
1-15 0.90%
16-23 0.85% to 0.50%
(reduced by
0.05% annually)
24+ 0.45%
</TABLE>

Fund expense charges, which ranged from 0.30% to 1.50% at the most recent
fiscal year end, are also deducted.

Surrender Charge (determined by multiplying the Surrender Charge factor by
actual premiums paid up to the Target Premium, computed separately for the
initial Face Amount of the Policy and for each increase in the Face Amount):

<TABLE>
<CAPTION>
POLICY YEAR SURRENDER CHARGE FACTOR
----------- -----------------------
<S> <C>
1-7 30%
8 20%
9 10%
10+ 0%
</TABLE>

Partial Surrender Charge: During the Surrender Charge period for the Policy
and for each increase in the Face Amount, the partial surrender charge will be
the greater of 8% of the amount withdrawn or $25.

- --------------------------------------------------------------------------------

LIVING BENEFITS

You may make partial surrenders, subject to certain restrictions. The Death
Benefit will be reduced by the amount of the partial surrender. ANLIC allows
free transfers between the Investment Options, subject to minimum and maximum
transfer amounts.

You may Surrender the Policy at any time for its Cash Surrender Value. (See
pages 26 and 29.)

RETIREMENT INCOME BENEFITS

Loans may be available on a more favorable interest rate basis after the fifth
Policy Year. Should the Policy lapse while loans are outstanding, the portion of
the loan attributable to earnings will become a taxable distribution. (See page
29.)

You may Surrender the Policy or make a partial withdrawal and take values as
payments under one or more of six different payment options.

DEATH BENEFITS

Generally, Death Benefit income is tax free to the Beneficiary. The Beneficiary
may be paid a lump sum or may select any of the six payment methods available as
retirement benefits.

ALLOCATOR 2000
5
<PAGE> 9

QUESTIONS AND ANSWERS ABOUT YOUR POLICY

The following summary is intended to highlight the most important features
of an Allocator 2000 Policy that you should consider. You will find more
detailed information in the main portion of the prospectus; cross-references are
provided for your convenience. As you review this Summary, take note of the
capitalized terms which are defined in the Definitions Section of this
prospectus. This summary and all other parts of this prospectus are qualified in
their entirety by the terms of the Allocator 2000 Policy, which is available
upon request from ANLIC.

WHO IS THE ISSUER OF AN ALLOCATOR 2000 POLICY?
ANLIC is the issuer of each Allocator 2000 Policy. ANLIC enjoys a rating of
A (Excellent) from A.M. Best Company, a firm that analyzes insurance carriers. A
stock life insurance company organized in Virginia, ANLIC is a wholly owned
subsidiary of Acacia Life Insurance Company which is, in turn, a second tier
subsidiary of Ameritas Acacia Mutual Holding Company. (See the section on Acacia
National Life Insurance Company.)

WHY SHOULD I CONSIDER PURCHASING AN ALLOCATOR 2000 POLICY?
The primary purpose of an Allocator 2000 Policy is to provide life
insurance protection on the Insured named in the Policy. This means that, so
long as the Policy is in force, it will provide for:

- - payment of a Death Benefit, which will never be less than the current face
amount at the time of the Death of the Insured (See the section on Death
Benefits.);

- - Policy loans (See the section on Loan Privileges.);

- - Partial Surrender, and Surrender features. (See the sections on Surrender
Privileges and Partial Surrenders.)

An Allocator 2000 Policy also includes an investment component. This means
that, so long as the Policy is in force, you will be responsible for selecting
the manner in which Net Premiums will be invested. Thus, the value of an
Allocator 2000 Policy will reflect your investment choices over the life of the
Policy.

WHAT ARE THE CHARGES ASSOCIATED WITH OWNERSHIP OF AN ALLOCATOR 2000 POLICY?

SURRENDER CHARGE - Because ANLIC incurs expenses immediately upon the
issuance of an Allocator 2000 Policy that are recovered over a period of years,
an Allocator 2000 Policy that is Surrendered or lapses on or before its 9th
Policy Anniversary is subject to a Surrender Charge. Additional Surrender
Charges may apply if you increase the Face Amount of your Allocator 2000 Policy.
Because the Surrender Charge may be significant upon early surrender, you should
purchase an Allocator 2000 Policy only if you intend to maintain your Allocator
2000 Policy for a substantial period. (See the section on Surrender Charge.)
Partial Surrender Charge -- During the Surrender Charge period for the Policy
and any increase in Face Amount, there will be a charge for a partial surrender
equal to 8% of the amount withdrawn or $25, whichever is greater.

PREMIUM EXPENSE CHARGE - Certain states impose premium and other taxes in
connection with insurance policies such as Allocator 2000. ANLIC deducts 2.25%
of each premium to cover these charges.

COST OF INSURANCE - Charges will be deducted monthly against the Policy
Account Value to cover the Cost of Insurance under the Policy. Cost of insurance
rates are based on the Insured's sex, Issue Age, policy duration, Face Amount,
and rate class. (See the section on Policy Account Value Charges.)

ADMINISTRATIVE EXPENSE CHARGE - Charges are deducted to compensate ANLIC
for administering each individual Allocator 2000 Policy. These charges equal $27
per month for the first Policy year and $8 each month thereafter.

MORTALITY AND EXPENSE RISK CHARGE - As compensation for mortality and
expense risks assumed in connection with the Policy, ANLIC will deduct a daily
Mortality and Expense Risk Charge from the value of the net assets of the
Variable Account. For the first 15 years of your Policy, this charge is at the
rate of 0.90% annually. Beginning in the 16th Policy year, this charge is
reduced by 0.05% annually until it reaches 0.45% annually in Policy year 24; the
rate remains level thereafter. No mortality and expense risk

ALLOCATOR 2000
6
<PAGE> 10

charges will be deducted from the amounts in the Fixed Account. (See the section
on Daily Charges Against the Variable Account.)

FUND EXPENSE SUMMARY. In addition to the charges against Separate Account I
described just above, management fees and expenses will be assessed by the fund
managers against the amounts invested in the various portfolios. No portfolio
fees will be assessed against amounts placed in the Fixed Account.

The information shown below was provided to ANLIC by the Funds and ANLIC
has not independently verified such information. Each of the Funds is managed by
an investment advisory organization that is entitled to receive a fee for its
services based on the value of the relevant portfolio's net assets. Each Fund,
other than the Calvert Social portfolios, is managed by an organization that is
not affiliated with ANLIC. The Calvert Social portfolios are managed by Calvert
Asset Management Company, Inc., an ANLIC affiliate. Other Calvert companies
provide administrative services to certain of the portfolios. Unless otherwise
noted, the amount of expenses, including the asset based advisory fee referred
to above, borne by each portfolio for the fiscal year ended December 31, 1999,
was as follows:

<TABLE>
<CAPTION>
TOTAL
(Reflecting
INVESTMENT WAIVERS WAIVERS AND/OR
ADVISORY & 12B-1 OTHER AND/OR REIMBURSEMENTS,
PORTFOLIO MANAGEMENT EXPENSE EXPENSES TOTAL REIMBURSEMENTS IF ANY)
--------- ---------- ------- -------- ----- -------------- ---------------
<S> <C> <C> <C> <C> <C> <C>
ALGER AMERICAN(1)
Alger American Growth 0.75% -- 0.04% 0.79% -- 0.79%
Alger American MidCap Growth 0.80% -- 0.05% 0.85% -- 0.85%
Alger American Small
Capitalization 0.85% -- 0.05% 0.90% -- 0.90%
CALVERT SOCIAL(2)
Calvert Social Money Market 0.50% -- 0.17%(3) 0.67% -- 0.67%
Calvert Social Small Cap
Growth 1.00% -- 0.58%(3) 1.58% -- 1.58%
Calvert Social Mid Cap
Growth 0.90% -- 0.21%(3) 1.11% -- 1.11%
Calvert Social International
Equity 1.10% -- 0.50%(3) 1.60%(4) -- 1.60%
Calvert Social Balanced 0.70% -- 0.19%(3) 0.89% -- 0.89%
DEUTSCHE VIT(5)
Deutsche VIT Equity 500
Index 0.20% -- 0.23% 0.43% 0.13% 0.30%
Deutsche VIT Small Cap Index 0.35% -- 0.83% 1.18% 0.73% 0.45%
Deutsche VIT EAFE Equity
Index 0.45% -- 0.69% 1.15% 0.50% 0.65%
FIDELITY PORTFOLIOS(6)
VIP Equity-Income: Service
Class 2 0.48% 0.25% 0.10% 0.83% -- 0.83%(7)
VIP High Income: Service
Class 2 0.58% 0.25% 0.12% 0.95% -- 0.95%
VIP II Contrafund: Service
Class 2 0.58% 0.25% 0.12% 0.95% -- 0.95%(7)
FTVIP(8)
Templeton Asset Strategy
Fund(9) -- Class 2 0.60% 0.25%(10) 0.14% 0.99% -- 0.99%
Templeton International
Securities
Fund(11) -- Class 2 0.65% 0.25%(10) 0.20% 1.10% -- 1.10%
</TABLE>

ALLOCATOR 2000
7
<PAGE> 11

- -------------------------

(1) Fred Alger Management, Inc. is manager to the Alger American portfolios.

(2) Calvert Asset Management Company, Inc., an affiliate of ANLIC, is
investment advisor of the Calvert Social Portfolios.

(3) "Other Expenses" reflect an indirect fee. Net fund operating expenses after
reductions for fees paid indirectly would be as follows:

<TABLE>
<S> <C>
Calvert Social Money Market 0.64%
Calvert Social Small Cap Growth 1.15%
Calvert Social Mid Cap Growth 1.02%
Calvert Social International Equity 1.50%
Calvert Social Balanced 0.86%
</TABLE>

(4) Total expenses have been restated to reflect expenses expected to be
incurred in 2000, resulting from a change in 1999 to the administrative
agreement, as approved by the shareholders.

(5) Bankers Trust Company is the investment advisor to Deutsche VIT. For its
services, the investment advisor receives a fee that is a percentage of
each fund's average daily net assets. The investment advisor has entered
into agreements to waive and/or reimburse operating expenses, including its
fees, that exceed certain percentages of the funds' aggregate average daily
net assets. Any differences in amounts are due to rounding.

(6) Fidelity Management & Research Company is manager of VIP and VIP II
(Fidelity Portfolios). Service Class 2 expenses are based on estimated
expenses for the first year.

(7) A portion of the brokerage commissions certain portfolios pay was used to
reduce portfolio expenses. In addition, through arrangements with the
portfolios' custodian, credits realized as a result of uninvested cash
balances were used to reduce a portion of the portfolios' expenses. After
these reductions, the total operating expenses presented in the table for
these portfolios would have been as follows:

<TABLE>
<S> <C>
VIP Equity Income: Service Class 2 0.82%
VIP II Contrafund: Service Class 2 0.92%
</TABLE>

ALLOCATOR 2000
8
<PAGE> 12

(8) Templeton Investment Counsel, Inc. is investment adviser to the FTVIP
funds.

(9) (Previously the Templeton Asset Allocation Fund) On 2/8/00, shareholders
approved a merger and reorganization that combined the fund with the
Templeton Global Asset Allocation Fund. The shareholders of that fund
approved new management fees, which apply to the combined fund effective
5/1/00. The table shows restated total expenses for the fund based on the
new fund fees and the combined assets of the two funds as of 12/31/99, even
though the merger and new fees did not become effective until 5/1/00.

(10) The fund's class 2 distribution plan or "rule 12b-1 plan" is described in
the fund's prospectus. While the maximum amount payable under the fund's
12b-1 plan is 0.35% per year of the fund's average daily net assets, the
Board of Trustees of FTVIP has set the current rate at 0.25%.

(11) (Previously the Templeton International Fund) On 2/8/00, shareholders
approved a merger and reorganization that combined the fund with the
Templeton International Equity Fund. The shareholders of that fund approved
new management fees, which apply to the combined fund effective 5/1/00. The
table shows restated total expenses for the fund based on the new fund fees
and the combined assets of the two funds as of 12/31/99, even though the
merger and new fees did not become effective until 5/1/00.

(12) Neuberger Berman Management Inc. ("NBMI") provides investment management
services to each Neuberger Berman AMT portfolio that include, among other
things, making and implementing investment decisions and providing
facilities and personnel necessary to operate the portfolio. NBMI provides
administrative services to each portfolio that include furnishing similar
facilities and personnel to the portfolio. With the portfolio's consent,
NBMI is authorized to subcontract some of its responsibilities under its
administration agreement with the portfolio to third parties. Each
portfolio bears all expenses of its operations other than those borne by
NBMI as administrator of the portfolio and as distributor of its shares.
Each portfolio bears all expenses of its operations other than those borne
by NBMI as investment manager of the series. These expenses include, but
are not limited to, for the portfolios and the series, legal and accounting
fees and compensation for trustees who are not affiliated with NBMI; for
the portfolios, transfer agent fees and the cost of printing and sending
reports and proxy materials to shareholders; and for the series, custodial
fees for securities. Any expenses which are not directly attributable to a
specific series are allocated on the basis of the net assets of the
respective series.

(13) Oppenheimer Funds, Inc. serves as manager to the Oppenheimer portfolios.

(14) Van Eck Associates Corporation serves as investment adviser to the Van Eck
Worldwide Hard Assets Fund.

Expense reimbursement agreements are expected to continue in future years
but may be terminated at any time. As long as the expense limitations continue
for a portfolio, if a reimbursement occurs, it has the effect of lowering the
portfolio's expense ratio and increasing its total return.

ANLIC may receive administrative fees from the investment advisers of
certain Funds. ANLIC currently does not assess a separate charge against
Separate Account I or the Fixed Account for any federal, state or local income
taxes. ANLIC may, however, make such a charge in the future if income or gains
within Separate Account I will incur any federal, or any significant state or
local income tax liability, or if the federal, state or local tax treatment of
ANLIC changes.

HOW DOES THE INVESTMENT COMPONENT OF MY ALLOCATOR 2000 POLICY WORK?
ANLIC has established the Variable Account, which is separate from all
other assets of ANLIC, as a vehicle to receive and invest premiums received from
Allocator 2000 Policy Owners. The Variable Account is divided into separate
Sub-accounts. Each Sub-account invests exclusively in shares of one of the
investment portfolios available through Allocator 2000. Each Policy Owner may
allocate Net Premiums to one or more Sub-accounts, or to the Fixed Account
(which invests in ANLIC's General Account) in the initial application. These
allocations may be changed, without charge, by notifying ANLIC's Service Office.
The aggregate value of your interests in the Sub-accounts, the Fixed Account and
any amount held in the General Account to secure Policy debt will represent the
Policy Account Value of your Allocator 2000 Policy. (See the section on General
Account.)

ALLOCATOR 2000
9
<PAGE> 13

WHAT INVESTMENT OPTIONS ARE AVAILABLE THROUGH THE ALLOCATOR 2000 POLICY?

The Investment Options available through Allocator 2000 include 25
investment Portfolios, each of which is a separate series of a mutual fund from:
The Alger American Fund ("Alger American"); Calvert Variable Series, Inc.
("Calvert Social"); Deutsche Asset Management VIT Funds ("Deutsche VIT");
Variable Insurance Products Fund ("VIP") and Variable Insurance Products Fund II
("VIP II") (collectively "Fidelity"); Franklin Templeton Variable Insurance
Products Trust ("FTVIP"); Neuberger Berman Advisers Management Trust ("AMT");
Oppenheimer Variable Account Funds ("Oppenheimer Funds"); and Van Eck Worldwide
Insurance Trust ("Van Eck"). These Portfolios are listed in the Fund Expense
Summary above.

Details about the investment objectives and policies of each of the
available investment Portfolios, including management fees and expenses, appear
in the section on "The Portfolios" of this prospectus. Each Portfolio holds its
assets separately from the assets of the other Portfolios. In addition to the
listed Portfolios, Policyowners may also elect to allocate Net Premiums to the
Fixed Account which is available in most states. (See the section on General
Account.)

HOW DOES THE LIFE INSURANCE COMPONENT OF AN ALLOCATOR 2000 POLICY WORK?
An Allocator 2000 Policy provides for the payment of a minimum Death
Benefit upon the death of the Insured. The amount of the minimum Death Benefit
is chosen by you at the time your Allocator 2000 Policy is established. However,
Death Benefit Proceeds -- the actual amount that will be paid after ANLIC
receives Due Proof of Death -- may vary over the life of your Allocator 2000
Policy, depending on which of the two available coverage options you select.

If you choose Option A, the Death Benefit payable under your Allocator 2000
Policy will be the current face amount of your Allocator 2000 Policy or the
applicable percentage of Policy Account Value, whichever is greater. (See the
section on Applicable Percentage Table.) If you choose Option B, the Death
Benefit payable under your Allocator 2000 Policy will be the current face amount
of your Allocator 2000 Policy plus the Policy Account Value of your Allocator
2000 Policy, or if it is higher, the applicable percentage of the Policy Account
Value on the date of death. In either case, the applicable percentage is
established based on the Attained Age at the death of the Insured.

ARE THERE ANY RISKS INVOLVED IN OWNING AN ALLOCATOR 2000 POLICY?
Yes. Over the life of your Allocator 2000 Policy, the Sub-accounts to which
you allocate your premiums will fluctuate with changes in the stock market and
overall economic factors. These fluctuations will be reflected in the Policy
Account Value of your Allocator 2000 Policy and may result in loss of principal.
For this reason, the purchase of an Allocator 2000 Policy may not be suitable
for all individuals. It may not be advantageous to purchase an Allocator 2000
Policy to replace or augment your existing insurance arrangements. Appendix A
includes tables illustrating the impact that hypothetical market returns would
have on Policy Account Values under an Allocator 2000 Policy.

WHAT IS THE PREMIUM THAT MUST BE PAID TO KEEP AN ALLOCATOR 2000 POLICY IN FORCE?
Like a traditional life insurance policy, an Allocator 2000 Policy requires
the payment of premiums in order to keep the Policy in force. You will be asked
to establish a payment schedule before your Allocator 2000 Policy becomes
effective.

The distinction between a traditional life policy and an Allocator 2000
Policy is an Allocator 2000 Policy will not lapse simply because premium
payments are not made according to that payment schedule. However, an Allocator
2000 Policy will lapse, even if scheduled premium payments are made, if the Cash
Surrender Value of your Allocator 2000 Policy falls below zero or premiums paid
do not, in the aggregate, equal the premium necessary to satisfy the Benchmark
Premium or the Guaranteed Death Benefit requirements. (See the section on
Premiums.)

HOW ARE PREMIUMS PAID, PROCESSED AND CREDITED TO ME?
Your Allocator 2000 Policy will be issued after a completed application is
accepted, and the initial premium payment is received, by ANLIC at its
Administrative Office. ANLIC has contracted with Ameritas Life Insurance Corp.
("ALIC"), having its principal place of business at 5900 "O" Street.

ALLOCATOR 2000
10
<PAGE> 14

Lincoln, Nebraska for it to provide ANLIC with certain administrative services
for the Flexible Premium Variable Life Policies.

On the Policy Date or when the initial premium is received whichever is
later, your initial Net Premium will be allocated to the Money Market
Sub-account. After a fifteen day period, the Policy Account Value of the Policy
will be allocated among the Investment Options according to the instructions in
your application. You have the right to examine your Allocator 2000 Policy and
return it for a refund for a limited time, even after the Policy Date. (See the
section on Examination of the Policy Privilege (Free Look).)

ANLIC will send premium payment notices to you according to any schedule
you select. You may make subsequent premium payments according to the Premium
schedule you select, although you are not required to do so. When ANLIC receives
your Premium Payment at its Administrative Office, the Net Premium will be
allocated to the Investment Options according to your selections . (See the
section on Allocation of Premiums and Policy Account Value.)

As already noted, Allocator 2000 provides you considerable flexibility in
determining the frequency and amount of premium payments. This flexibility is
not, however, unlimited. You should keep certain factors in mind in determining
the payment schedule that is best suited to your needs. These include the amount
of the Benchmark Premium and/or Guaranteed Death Benefit Premium requirement
needed to keep your Allocator 2000 Policy in force; maximum premium limitations
established under the Federal tax laws ; and the impact that reduced Premium
Payments may have on the Cash Surrender Value of your Allocator 2000 Policy.
(See the sections on Federal Tax Considerations, Premiums, and Surrender
Privileges.)

IS THE POLICY ACCOUNT VALUE OF MY ALLOCATOR 2000 POLICY AVAILABLE WITHOUT
SURRENDER CHARGES?
Yes, you may obtain a loan, secured by the Policy Account Value of your
Allocator 2000 Policy equal to 90% of the Cash Surrender Value. The Owner may
obtain Policy loans at any time the Policy has Loan Value. The minimum loan
request ANLIC allows is $1,000. There is an interest rate of 6.45% per year
charged for loans when the Policy Account Value is less than the cumulative
premiums paid. Otherwise, after the fifth Policy year the loan rate charged will
be 4.5% per year for the amount of the loan that equals or is less than the
amount that the Policy Account Value exceeds cumulative premiums paid. The
interest is due and payable at the end of each Policy Month. Loans and interest
may be repaid at any time prior to the Maturity Date. Loans may be taxable
transactions. (See the section on Loan Privileges.)

WHEN DOES MY ALLOCATOR 2000 POLICY TERMINATE?
You may terminate your Allocator 2000 Policy by surrendering the Policy
while the Insured is alive for its Cash Surrender Value. As noted above, your
Allocator 2000 Policy will terminate if you fail to pay required premiums or
maintain sufficient Policy Account Value to cover Policy Lapse charges. (See the
section on Policy Lapse.)

WHO CAN I CONTACT FOR MORE INFORMATION CONCERNING THE ALLOCATOR 2000 POLICY?
You can contact your Registered Representative or you can write to us at
our Administrative Office, Acacia National Life Insurance Company, 5900 "O"
Street, P.O. Box 81889, Lincoln, Nebraska 68501. ANLIC's telephone number is
888-837-6791 and its website address is www.acaciagroup.com.

ANLIC AND THE VARIABLE ACCOUNT

ACACIA NATIONAL LIFE INSURANCE COMPANY
Acacia National Life Insurance Company ("ANLIC") is a stock life insurance
company organized in the Commonwealth of Virginia. ANLIC was incorporated on
December 9, 1974. ANLIC is currently licensed to sell life insurance in 46
states, and the District of Columbia.

ANLIC is a wholly owned subsidiary of Acacia Life Insurance Company
("Acacia Life"), a District of Columbia stock company. Acacia Life is in turn a
second tier subsidiary of Ameritas Acacia Mutual Holding Company, a Nebraska
mutual insurance holding company. The Administrative Offices of both ANLIC and
Acacia Life are at 5900 "O" Street, P.O. Box 81889, Lincoln, Nebraska 68501.
ANLIC's telephone number is 888-837-6791 and its website address is
www.acaciagroup.com.

ALLOCATOR 2000
11
<PAGE> 15

On January 1, 1999, Ameritas Mutual Insurance Holding Company ("Ameritas
Mutual"), a Nebraska mutual insurance holding company and Acacia Mutual Holding
Corporation ("Acacia Mutual"), a District of Columbia mutual holding corporation
merged and became Ameritas Acacia Mutual Holding Company ("Ameritas Acacia") a
Nebraska mutual insurance holding company. Both Ameritas Acacia and Ameritas
Holding Company, an intermediate holding company, are organized under the
Nebraska Mutual Insurance Holding Company Act. Acacia Life Insurance Company, a
subsidiary of Ameritas Holding Company is regulated by the District of Columbia
Insurance Department. Ameritas Acacia and its subsidiaries had total statutory
assets at December 31, 1999 of over $6.3 billion and Acacia Life and its
subsidiaries had total assets as of December 31, 1999 of $1.7 billion.

Acacia Life also owns all of the outstanding stock of the Acacia Financial
Corporation, a holding company, which owns all of the stock of The Advisors
Group, Inc. and the Calvert Group, Ltd. ("Calvert"), which in turn owns Calvert
Asset Management Company, Inc., the investment adviser of Calvert Variable
Series, Inc., a series of Funds available under the Policies. The Advisors
Group, Inc. is the principal underwriter for the Policies described in this
Prospectus. The Advisors Group, Inc. sells shares of other mutual funds and
other securities, and may also sell variable annuity or variable life policies
of other issuers.

THE VARIABLE ACCOUNT
Acacia National Variable Life Insurance Separate Account I ("Variable
Account") was established by ANLIC as a separate account on January 31, 1995.
The Variable Account will receive and invest the net premiums paid under this
Policy. Net premiums placed in the Variable Account constitute certain reserves
for benefits payable under the Policies, and these are actuarial reserves for
future benefits payable under the Policies. In addition, the Variable Account
may receive and invest net premiums for other flexible premium variable life
insurance policies issued by ANLIC.

Although the assets of the Variable Account are the property of ANLIC, the
Code of Virginia under which the Variable Account was established provides that
the assets in the Variable Account attributable to the Policies are generally
not chargeable with liabilities arising out of any other business which ANLIC
may conduct. The assets of the Variable Account shall, however, be available to
cover the liabilities of the General Account of ANLIC to the extent that the
Variable Account's assets exceed its liabilities arising under the Policies
supported by it. Thus while Owners neither hold legal title to, nor have any
beneficial ownership interest in the Variable Account assets, because the assets
are legally segregated from other assets of ANLIC subject to the claims of
creditors, Owners have preferential rights to the ANLIC Variable Account assets.

The Variable Account is currently divided into 25 Sub-accounts. Each
Sub-account invests exclusively in shares of a single Portfolio of a Fund.
Income and both realized and unrealized gains or losses from the assets of each
Sub-account of the Variable Account are credited to or charged against that
Sub-account without regard to income, gains or losses from any other Sub-account
of the Variable Account or arising out of any other business ANLIC may conduct.
Each Sub-account reinvests all dividends and income and capital gain
distributions declared by the Portfolio.

The Variable Account has been registered as a unit investment trust under
the Investment Company Act of 1940, as amended (the "1940 Act"). Registration
with the Securities and Exchange Commission ("SEC") does not involve supervision
of the management or investment practices or policies of the Variable Account or
ANLIC by the SEC.

THE PORTFOLIOS

The investment objectives of each of the Portfolios are summarized below.
There is no assurance that any of the Portfolios will achieve its stated
objective. More detailed information about the Portfolios, including a
description of the risks may be found in the Prospectus for each of the
Portfolios which must accompany or precede this Prospectus. In addition, the
Variable Account purchases shares of each Portfolio subject to the terms of the
respective participation agreements between ANLIC and the Funds. A copy of the
Agreements have been filed as Exhibits to the Registration Statement for the
Variable

ALLOCATOR 2000
12
<PAGE> 16

Account. Each of the Funds has or may have additional Portfolios that are not
available to the Variable Account.

THE ALGER AMERICAN FUND
The Variable Account has three Sub-accounts that invest exclusively in
shares of the Alger American Fund. The LargeCap Growth Sub-account, the MidCap
Growth Sub-account and the SmallCap Growth Sub-account invest in the Alger
American Growth Portfolio, the Alger American MidCap Growth Portfolio, and the
Alger American Small Capitalization Portfolio, respectively, of the Alger
American Fund.

The Alger American Growth Portfolio seeks to provide long-term capital
appreciation. It invests in equity securities, such as common or preferred
stocks, or securities convertible into or exchangeable for equity securities,
including warrants and rights, primarily of companies with total market
capitalization of $1 billion or greater.

The Alger American MidCap Growth Portfolio seeks to provide long-term
capital appreciation. It invests in equity securities, such as common or
preferred stocks, or securities convertible into or exchangeable for equity
securities, including warrants and rights. Except during temporary defensive
periods, the Portfolio invests at least 65% of its total assets in equity
securities, of companies that, at the time of purchase of the securities, have
total market capitalization within the range of companies included in the S & P
MidCap 400 index.

The Alger American Small Capitalization Portfolio seeks to provide
long-term capital appreciation. It invests in equity securities, such as common
or preferred stocks, or securities convertible into or exchangeable for equity
securities, including warrants and rights. Except during temporary defensive
period, the Portfolio invests at least 65% of its total assets in equity
securities, of companies that, at the time of purchase of the securities, have
total market capitalization within the range of companies included in the
Russell 2000 Growth Index.

Fred Alger Management, Inc. serves as investment manager to the Alger
American Fund.

CALVERT VARIABLE SERIES, INC.

The Variable Account has five Sub-accounts that invest exclusively in
shares of Calvert Variable Series, Inc.. The Social Money Market, Social
Strategic Growth, Social Managed Growth, Social Global and Social Balanced
Sub-accounts of the Variable Account invest in shares of the Calvert Social
Money Market Portfolio, the Calvert Social Small Cap Growth Portfolio, the
Calvert Social Mid Cap Growth Portfolio, the Calvert Social International Equity
Portfolio, and the Calvert Social Balanced Portfolio, respectively, of Calvert
Variable Series, Inc. Calvert Variable Series, Inc. is one of eight registered
investment companies in the Calvert Group, Ltd. Funds ("Calvert"). Calvert is a
second tier wholly-owned subsidiary of Acacia Life. Calvert is the sponsor of
the Fund.

These Portfolios seek to achieve competitive returns while encouraging
responsible corporate conduct. The Portfolios look for enterprises that make a
significant contribution to society through their products and the way they do
business. Each proposed portfolio investment that is deemed financially viable
is then screened according to the stated social criteria of the particular
Portfolio. Investments must, in the judgment of the investment adviser, be
consistent with these criteria. It should be noted that the Portfolios' social
criteria tend to limit the availability of investment opportunities more than is
customary with other investment portfolios. (See the individual Portfolio
Prospectuses for a complete description of each social screen.)

The Calvert Social Money Market Portfolio ("CS Money Market") seeks to
provide the highest level of current income, consistent with liquidity, safety
and security of capital, by investing in money market instruments, including
repurchase agreements with recognized securities dealers and banks secured by
such instruments, selected in accordance with the Portfolios' investment and
social criteria. CS Money Market attempts to maintain a constant net asset value
of $1.00 per share. There can be no assurance that the Portfolio will maintain a
constant net asset value of $1.00 per share. An investment in the Portfolio is
neither insured nor guaranteed by the United States government.

ALLOCATOR 2000
13
<PAGE> 17

Calvert Social Small Cap Growth ("CS Small Cap") seeks, with a concern for
social impact to achieve long-term capital appreciation by investing primarily
in the equity securities of small companies publicly traded in the United
States. In seeking capital appreciation, the Portfolio invests primarily in
equity securities of small capitalized growth companies that have historically
exhibited exceptional growth characteristics and that in the advisor's opinion,
have strong earnings potential relative to the U.S. market as a whole.

CS Small Cap may invest up to 35% of its assets in debt securities,
excluding money market instruments. These debt securities may consist of
investment-grade obligations and junk bonds.

Calvert Social Mid Cap Growth ("CS Mid Cap") seeks to provide long-term
capital appreciation by investing primarily in a nondiversified portfolio of the
equity securities of small- to mid-sized companies that are undervalued but
demonstrate a potential for growth.

CS Mid Cap may also invest in debt securities and may invest up to 5% of
its assets in non-investment grade securities and up to 25% of its assets in
foreign securities.

Calvert Social International Equity Portfolio ("CS International") seeks to
provide a high return consistent with reasonable risk by investing primarily in
a globally diversified portfolio of equity securities. The Portfolio seeks total
return through a globally diversified investment portfolio.

Under normal circumstances, CS International will invest at least 65% of
its assets in the securities of issuers in no less than three countries, other
than the United States. As an operating policy, the portfolio will limit its
investment in securities of U.S. issuers to 5% of its net assets. CS
International may also purchase unrated debt securities and may invest up to 5%
of its assets in non-investment grade bonds.

Calvert Social Balanced Portfolio ("CS Balanced") seeks to achieve a total
return above the rate of inflation through an actively managed portfolio of
stocks, bonds and money market instruments (including repurchase agreements
secured by such instruments) selected with a concern for the investment and
social impact of each investment.

CS Balanced may invest up to 20% of its assets in non-investment grade debt
obligations ("junk bonds").

Calvert Asset Management Company, Inc. ("CAM") is the investment adviser to
all the Portfolios of Calvert Variable Series, Inc.. CAM is a wholly owned
subsidiary of Calvert which is in turn a second tier wholly owned subsidiary of
Acacia Life. Pursuant to its investment advisory agreement, CAM manages the
investment and reinvestment of the assets of each Portfolio and is responsible
for the overall business affairs of each Portfolio. Calvert Administrative
Services, an affiliate of CAM, provides administrative services to each
Portfolio and is paid a fee by CAM of a percentage of net assets per year.

On behalf of CS International, CAM has entered into a subadvisory agreement
with Murray Johnstone International, Ltd. ("Murray Johnstone") of Glasgow,
Scotland, which has its principal U.S. office in Chicago, Illinois, and is a
wholly-owned subsidiary of United Asset Management Company. Murray Johnstone
manages the investment and reinvestment of assets of CS International, although
CAM may manage part of CS International's cash reserves required for liquidity
purposes.

On behalf of CS Balanced, CAM has entered into a subadvisory agreement with
United States Trust Company of Boston, a Massachusetts chartered commercial bank
with full trust powers. On behalf of CS Small Cap, CAM has entered into a
subadvisory agreement with Awad & Associates of New York. The subadvisers manage
the investment and reinvestment of the assets of the Portfolio, although CAM may
screen potential investments for compatibility with the Portfolio's social
criteria. CAM continuously monitors and evaluates the performance of the
subadvisers.

DEUTSCHE ASSET MANAGEMENT VIT FUNDS

The Variable Account has three Sub-accounts that invest exclusively in
shares of Portfolios of Deutsche VIT. The Equity 500 Index Sub-account, Small
Cap Index Sub-account, and EAFE Equity Index Sub-account invest in shares of the
Equity 500 Index Fund, Small Cap Index Fund, and EAFE Equity Index Fund,
respectively, of Deutsche.

ALLOCATOR 2000
14
<PAGE> 18

The Equity 500 Index Fund seeks to match, before expenses, the risk and
return characteristics of the Standard and Poor's 500 Composite Stock Price
("S&P 500 Index"). The Fund will invest primarily in common stocks of companies
that comprise the S&P 500 Index, which emphasizes stocks of large U.S.
companies. The Fund may also use stock index futures and options.

The Small Cap Index Fund seeks to match, before expenses, the risk and
return characteristics of the Russell 2000 Small Stock Index ("Russell 2000
Index"). The Fund will invest primarily in common stocks of companies that
comprise the Russell 2000 Index, which emphasizes stocks of small U.S.
companies. The Fund may also use stock index futures and options.

The EAFE Equity Index Fund seeks to match, before expenses, the risk and
return characteristics of the Morgan Stanley Capital International EAFE Index
("EAFE Index"). The Fund will invest primarily in common stocks of companies
that comprise the EAFE Index, which emphasizes stocks of companies in major
markets in Europe, Australia and the Far East. The Fund may also use stock index
futures and options.

Bankers Trust Company serves as investment adviser to the Deutsche Asset
Management VIT Funds.

FIDELITY VARIABLE INSURANCE PRODUCTS FUND
FIDELITY VARIABLE INSURANCE PRODUCTS FUND II
The Variable Account has two Sub-accounts that invest exclusively in shares
of Portfolios of the Variable Insurance Products Fund ("VIP") and one
Sub-Account that invests exclusively in shares of a Portfolio of the Variable
Insurance Products Fund II ("VIP II"). Equity-Income: Service Class 2
("Equity-Income") and High Income: Service Class 2 ("High-Income") invest in
shares of the VIP Equity-Income: Service Class 2 and VIP High Income: Service
Class 2 Portfolios, respectively. Contrafund: Service Class 2 ("Contrafund")
invests in shares of the VIP 2 Contrafund: Service Class 2 Portfolio of VIP II.

Equity-Income seeks reasonable income. Will also consider the potential for
capital appreciation. Seeks a yield which exceeds the composite yield on the
securities comprising the Standard & Poor's 500 by investing at least 65% in
income-producing equity securities, which tens to lead to investments in large
cap "value" stocks.

High Income seeks a high level of current income while also considering
growth of capital by investing at least 65% in income-producing equity
securities, which tens to lead to investments in large cap "value" stocks.

Contrafund seeks long-term capital appreciation by investing primarily in
common stocks and investing in securities of companies whose value it believes
is not fully recognized by the public.

Fidelity Management & Research Company serves as investment adviser to VIP
and VIP II.

FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST
The Variable Account has two Sub-accounts that invest exclusively in shares
of Portfolios of the Franklin Templeton Variable Insurance Products Trust
("FTVIP" or "Templeton Portfolios"). The Asset Strategy and International
Securities Sub-accounts invest in shares of the Templeton Asset Strategy Fund
Class 2 and Templeton International Securities Fund -- Class 2 Portfolios,
respectively, of FTVIP.

Templeton Asset Strategy -- Class 2 has the investment objective of high
total return. The fund will invest in equity securities of companies of any
nation, debt securities of companies and governments of any nation, and in money
market instruments.

Templeton International Securities -- Class 2 has the investment objective
of long-term capital growth. The fund will invest in the equity securities of
companies located outside the U.S., including emerging markets.

The investment adviser for the Templeton Portfolios is Templeton Investment
Counsel, Inc.

ALLOCATOR 2000
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<PAGE> 19

NEUBERGER BERMAN ADVISERS MANAGEMENT TRUST
The Variable Account has three Sub-Accounts that invest exclusively in
shares of Portfolios of the Neuberger Berman Advisers Management Trust ("AMT").
The Limited maturity Bond, Income and Growth, and Partners Sub-accounts of the
Variable Account invest in shares of the Limited Maturity Bond Portfolio, Growth
Portfolio, and Partners Portfolio, respectively, of AMT.

The Neuberger Berman Limited Maturity Bond Portfolio. The investment
objective of the Limited Maturity Bond Portfolio is to provide the highest
current income consistent with low risk to principal and liquidity; and
secondarily, total return. Neuberger Berman Limited Maturity Bond invests in a
diversified portfolio of fixed and variable rate debt securities and seeks to
increase income and preserve or enhance total return by actively managing
average portfolio maturity in light of market conditions and trends.

The Neuberger Berman Limited Maturity Bond Portfolio invests in a
diversified portfolio of short-to-intermediate-term U.S. Government and Agency
securities and debt securities issued by financial institutions, corporations,
and others, of at least investment grade. These securities include mortgage-
backed and asset-backed securities, repurchase agreements with respect to U.S.
Government and Agency securities, and foreign investments. The Neuberger Berman
Limited Maturity Bond Portfolio may invest up to 5% of its net assets in
municipal securities when the portfolio manager believes such securities may
outperform other available issues. The Portfolio may purchase and sell covered
call and put options, interest-rate futures contracts, and options on those
futures contracts, and may engage in lending portfolio securities. The
Portfolio's dollar-weighted average portfolio maturity may range up to five
years.

The Neuberger Berman Growth Portfolio seeks capital appreciation, without
regard to income. The Neuberger Berman Growth Portfolio invests in securities
believed to have the maximum potential for long-term capital appreciation. It
does not seek to invest in securities that pay dividends or interest, and any
such income is incidental. The Portfolio expects to be almost fully invested in
common stocks, often of companies that may be temporarily out of favor in the
market. The Portfolios' aggressive growth investment program involves greater
risks and share price volatility than programs that invest in more conservative
securities. Moreover, the Portfolio does not follow a policy of active trading
for short-term profits. Accordingly, the Portfolio may be more appropriate for
investors with a longer-range perspective. While the Portfolio uses the AMT
value-oriented investment approach, when the portfolio manager believes that
particular securities have greater potential for long-term capital appreciation,
the Portfolio may purchase such securities at prices with higher multiples to
measures of economic value (such as earnings). In addition, the Portfolio
focuses on companies with strong balance sheets and reasonable valuations
relative to their growth rates. It also diversifies its investments into many
companies and industries.

The Neuberger Berman Partners Portfolio seeks capital growth. Principal
series investments are common stocks of mid- to large-cap companies.

The investment adviser for the Limited Maturity Bond, Growth and Partners
Portfolios of AMT is Neuberger Berman Management Inc. ("NBMI"). NBMI retains
Neuberger Berman, L.P., without cost to AMT, as subadviser to furnish it with
investment recommendations and research information. NBMI provides investment
management services to each Portfolio that include, among other things, making
and implementing investment decisions and providing facilities and personnel
necessary to operate the Portfolio. NBMI provides administrative services to
each Portfolio that include furnishing similar facilities and personnel for the
Portfolio. With the Portfolio's consent, NBMI is authorized to subcontract some
of its responsibilities under its administration agreement with the Portfolio to
third parties.

OPPENHEIMER VARIABLE ACCOUNT FUNDS
The Variable Account has five Sub-accounts that invest exclusively in
shares of Portfolios of the Oppenheimer Variable Account Funds (the "Oppenheimer
Funds"). The Aggressive Growth, Capital Appreciation, Growth & Income, High
Income, and Strategic Bond Income Sub-Accounts of the Variable Account invest in
shares of the Aggressive Growth Fund/VA, Capital Appreciation Fund/VA, Main
Street Growth & Income Fund/VA, High Income Fund/VA and Strategic Bond Fund/VA
respectively, of the Oppenheimer Funds.

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The Oppenheimer Funds are managed by Oppenheimer Funds, Inc. ("the
Manager"), which is responsible for selecting the Oppenheimer Funds' investments
and handles its day-to-day business. The Manager carries out its duties, subject
to the policies established by the Board of Trustees, under investment advisory
agreements for each Oppenheimer Fund which state the Manager's responsibilities.

Oppenheimer Aggressive Growth Fund/VA ("Aggressive Growth Fund") seeks to
achieve capital appreciation by investing in "growth-type" companies. Such
companies are believed to have relatively favorable long-term prospects for
increasing demand for their goods or services, or to be developing new products,
services or markets, and normally retain a relatively larger portion of their
earnings for research, development and investment in capital assets.

Oppenheimer Capital Appreciation Fund/VA ("Capital Appreciation Fund")
seeks to achieve capital appreciation by investing insecurities of well-known
established companies. Such securities generally have a history of earnings and
dividends and are issued by seasoned companies.

Oppenheimer Main Street Growth & Income Fund/VA ("Growth & Income Fund")
seeks a high total return (which includes growth in the value of its shares as
well as current income) from equity and debt securities. Its equity investments
will include common stocks, preferred stocks, convertible securities and
warrants. Its debt securities will include bonds, participation interests,
asset-backed securities, private-label mortgage-backed securities and
collateralized mortgage obligations, zero coupon securities and U.S.
obligations. From time to time Growth & Income Fund may focus on small to medium
capitalization issuers, the securities of which may be subject to greater price
volatility than those of larger capitalized issuers.

The composition of Growth & Income Fund's Portfolio among equity and
fixed-income investments will vary from time to time based upon the Manager's
evaluation of economic and market trends and perceived relative total
anticipated return from such types of investments. Accordingly, there is neither
a minimum nor a maximum percentage of Growth & Income Fund's Assets that may, at
any given time, be invested in either type of investment.

Oppenheimer High Income Fund/VA ("High Income Fund") seeks a high level of
current income from investment in high yield fixed-income securities (including
long-term debt and preferred stock issues, including convertible securities).
High Income Fund's investment policy is to assume certain risks in seeking high
yield including securities in the lower rating categories, commonly known as
"junk bonds", which are subject to a greater risk of loss of principal and
nonpayment of interest than higher rated securities. These securities may be
considered to be speculative.

Oppenheimer Strategic Bond Fund ("Strategic Bond Fund') seeks a high level
of current income by investing primarily in a diversified portfolio of high
yield fixed-income securities. Such income is principally derived from interest
on debt securities and the Fund seeks to enhance such income by writing covered
call options on debt securities. The Fund intends to invest principally in (I)
foreign government and corporate debt securities (ii) U.S. Government
securities, and (iii) lower-rated high yield domestic debt securities, commonly
known as "junk bonds", which are subject to a greater risk of loss of principal
and nonpayment of interest than higher-rated securities. These securities may be
considered to be speculative. Under normal circumstances, the Fund's assets will
be invested in each of these three sectors. However, Strategic Bond Fund may
from time to time invest up to 100% of its total assets in any one sector if, in
the judgment of the Manager, the Fund has the opportunity of seeking a high
level of current income without undue risk to principal.

VAN ECK WORLDWIDE INSURANCE TRUST
The Hard Assets Sub-account of the Variable Account invests exclusively in
shares of the Van Eck Worldwide Hard Assets Fund.

Van Eck Worldwide Hard Assets Fund seeks long-term capital appreciation by
investing globally, primarily in "hard asset" securities. Income is a secondary
consideration. The Worldwide Hard Assets Fund will invest at least 65% of its
assets in "hard asset securities," defined as securities of companies that
derive at least 50% of gross revenue or profit from exploration, development,
production or distribution of

ALLOCATOR 2000
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<PAGE> 21

precious metals, natural resources, real estate or commodities. The Fund may
concentrate as much as 50% of its assets in any single "hard asset" sector.

The production and marketing of hard assets may be affected by actions and
changes in government. In addition, hard assets and securities of hard assets
companies may be cyclical in nature. During periods of economic or financial
instability, the securities of some hard assets companies may be subject to
broad price fluctuations, reflecting volatility of energy and basic materials
prices and possible instability of supply of various hard assets. In addition,
some hard assets companies may also be subject to the risks generally associated
with extraction of natural resources, such as the risks of mining and oil
drilling, and the risks of hazards associated with natural resources, such as
fire, drought, increased regulatory and environmental costs, and others.
Securities of hard assets companies may also experience greater price
fluctuations than the relevant hard assets. In periods of rising hard assets
prices, such securities may rise at a faster rate, and conversely, in times of
falling hard assets prices, such securities may suffer a greater price decline.

The investment adviser for the Van Eck Worldwide Hard Assets Fund is Van
Eck Associates Corporation.

RESOLVING MATERIAL CONFLICTS
The Funds are used as the investment vehicle for variable life insurance
policies issued by ANLIC. In addition, the Funds are also available to
registered separate accounts of insurance companies other than ANLIC. As a
result, there is a possibility that a material conflict may arise between the
interest of Owners whose policies are allocated to the Variable Account and the
Owners of life insurance policies and variable annuities issued by such other
companies whose values are allocated to one or more other separate accounts
investing in any one of the Funds. In addition, one or more of the Funds may
sell shares to certain retirement plans qualifying under Section 401 of the Code
(including cash or deferred arrangements under Section 401(k) of the Code). As a
result, there is a possibility that a material conflict may arise between the
interests of Owners of policies generally, or certain classes of Owners, and
such retirement plans or participants in such retirement plans.

In the event of a material conflict, ANLIC will take any necessary steps,
including removing the Variable Account from that Fund, to resolve the matter.
The Board of Directors or Trustees of the Funds intend to monitor events in
order to identify any material conflicts that may possibly arise and to
determine what action, if any, should be taken in response to those events or
conflicts. (See the individual Fund prospectuses for more information.)

ADDITION, DELETION, OR SUBSTITUTION OF INVESTMENTS

ANLIC cannot guarantee that shares of the Portfolios will always be
available for investment of premium or for transfers. ANLIC reserves the right,
subject to compliance with applicable law, to make additions to, deletions from,
or substitutions for the shares that are held by the Variable Account or that
the Variable Account may purchase. ANLIC reserves the right to eliminate the
shares of any of the Portfolios of the Funds and to substitute shares of another
Portfolio of the Funds or of another open-end registered investment company, if
the shares of a Portfolio are no longer available for investment, or if in its
judgment further investment in any Portfolio should become inappropriate in view
of the purposes of the Variable Account. ANLIC will not substitute any shares
attributable to an Owner's interest in a Sub-account of the Variable Account
without notice and prior approval of the SEC, to the extent required by the 1940
Act or other applicable law. Nothing contained herein shall prevent the Variable
Account from purchasing other securities for other Portfolios or classes of
Policies, or from permitting a conversion between Portfolios or classes of
Policies on the basis of requests made by Owners.

ANLIC also reserves the right to establish additional Sub-accounts of the
Variable Account, each of which would invest in a new series or Portfolio of the
Funds, or in shares of another investment company, with a specified investment
objective. New Sub-accounts may be established when, in the sole discretion of
ANLIC, marketing needs or investment conditions warrant, and any new
Sub-accounts will be made available to existing Owners on a basis to be
determined by ANLIC. ANLIC may also eliminate one or more Sub-accounts if, in
its sole discretion, marketing, tax, or investment conditions warrant.

ALLOCATOR 2000
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<PAGE> 22

In the event of any such substitution or change, ANLIC may, by appropriate
endorsement, make such changes in this and other policies as may be necessary or
appropriate to reflect such substitution or change. If deemed by ANLIC to be in
the best interest of persons having voting rights under the Policies, the
Variable Account may be operated as a management company under the 1940 Act, it
may be deregistered under that Act in the event such registration is no longer
required, or it may be combined with other ANLIC separate accounts.

POLICY BENEFITS

DEATH BENEFITS
As long as the Policy remains in force (See the section on Policy Lapse and
Reinstatement -- Lapse.), ANLIC will, upon proof of the Insured's death, pay the
death benefit proceeds of a Policy to the named Beneficiary in accordance with
the designated death benefit option. The amount of Death Benefit payable will be
determined as of the end of the Valuation Period on the date of death, and will
not reflect subsequent Variable Account investment performance. The proceeds may
be paid in a lump sum or under one or more of the settlement options set forth
in the Policy. The death benefit proceeds will be reduced by any outstanding
indebtedness and any due and unpaid charges. These proceeds will be increased by
any additional insurance provided by rider and by the monthly deduction for the
month in which death occurred.

The Policy provides two death benefit options: Death Benefit Option A
("Option A") and Death Benefit Option B ("Option B"). The Owner designates the
death benefit option in the application. ANLIC guarantees that as long as the
Policy remains in force (See the section on Policy Lapse and
Reinstatement -- Lapse.), under either option the death benefit will never be
less than the current face amount of the Policy. These proceeds will be reduced
by any outstanding indebtedness and any due and unpaid charges.

OPTION A. The death benefit is the greater of the current face amount of
the Policy or the applicable percentage of Policy Account Value on the date of
death. The applicable percentage is 250% for an Insured age 40 or below on the
Policy Anniversary prior to the date of death. For Insureds with an Attained Age
over 40 on a Policy Anniversary, the percentage declines as shown in the
Applicable Percentage Table. (See the section on Applicable Percentage Table.)
Accordingly, under Option A, the death benefit will remain level unless the
applicable percentage of Policy Account Value exceeds the current face amount,
in which case the amount of the death benefit will vary as the Policy Account
Value varies.

ILLUSTRATION OF OPTION A. For purposes of this illustration, assume that
the Insured's Attained Age is between 30 and 40 and that there is no outstanding
indebtedness. Under Option A, a Policy with a $100,000 face amount will
generally pay $100,000 in Death Benefit Proceeds. However, because the death
benefit must be equal to or be greater than 250% of Policy Account Value, any
time the Policy Account Value of the Policy exceeds $40,000 the death benefit
will exceed the $100,000 face amount. Each additional dollar added to the Policy
Account Value above $40,000 will increase the death benefit by $2.50. Thus, if
the Policy Account Value exceeds $40,000 and increases by $100 because of
investment performance or premium payments, the death benefit will increase by
$250. An Owner with a Policy Account Value of $50,000 will be entitled to a
death benefit of $125,000 ($50,000 X 250%); a Policy Account Value of $75,000
will yield a death benefit of $187,500 ($75,000 X 250%); a Policy Account Value
of $100,000 will yield a death benefit of $250,000 ($100,000 X 250%).

Similarly, so long as the Policy Account Value exceeds $40,000, each dollar
taken out of the Policy Account Value will reduce the death benefit by $2.50.
If, for example, the Policy Account Value is reduced from $75,000 to $70,000
because of partial surrenders, charges or negative investment performance, the
death benefit will be reduced from $187,500 to $175,000. If at any time,
however, the Policy Account Value multiplied by the applicable percentage is
less than the face amount, the death benefit will equal the current face amount
of the Policy.

The applicable percentage becomes lower as the Insured's Attained Age
increases. If the Attained Age of the Insured in the illustration above were,
for example, 50 (rather than between 30 and 40), the applicable percentage would
be 185%. The death benefit would not exceed the $100,000 face amount

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<PAGE> 23

unless the Policy Account Value exceeded approximately $54,055 (rather than
$40,000), and each $1 then added to or taken from the Policy Account Value would
change the death benefit by $1.85 (rather than $2.50).

APPLICABLE PERCENTAGE TABLE

<TABLE>
<CAPTION>
ATTAINED AGE APPLICABLE PERCENTAGE
- ------------ ---------------------
<S> <C>
41 243%
42 236
43 229
44 222
45 215
46 209
47 203
48 197
49 191
50 185
51 178
52 171
53 164
54 157
55 150
56 146
57 142
58 138
59 134
60 130
</TABLE>

<TABLE>
<CAPTION>
ATTAINED AGE APPLICABLE PERCENTAGE
- ------------ ---------------------
<S> <C>
61 128%
62 126
63 124
64 122
65 120
66 119
67 118
68 117
69 116
70 115
71 113
72 111
73 109
74 107
75-90 105
91 104
92 103
93 102
94 101
95 or older 100
</TABLE>

OPTION B. The death benefit is equal to the greater of the current Face
Amount plus the Policy Account Value of the Policy or the applicable percentage
of the Policy Account Value on the date of death. The applicable percentage is
250% for an Insured age 40 or below on the Policy anniversary prior to the date
of death. For Insureds with an Attained Age over 40 on a Policy anniversary, the
percentage declines as shown in the Applicable Percentage Table. Accordingly,
under Option B the amount of the death benefit will always vary as the Policy
Account Value varies.

ILLUSTRATION OF OPTION B. For purposes of this illustration, assume that
the Insured is under the age of 40 and that there is no outstanding
indebtedness. Under Option B, a Policy with a face amount of $100,000 will
generally pay a death benefit of $100,000 plus the Policy Account Value. Thus,
for example, a Policy with a Policy Account Value of $20,000 will have a death
benefit of $120,000 ($100,000 + $20,000); a Policy Account Value of $40,000 will
yield a death benefit of $140,000 ($100,000 + $40,000). The death benefit,
however, must be at least 250% of the Policy Account Value. As a result, if the
Policy Account Value of the Policy exceeds approximately $66,667, the death
benefit will be greater than the face amount plus the Policy Account Value. Each
additional dollar of the Policy Account Value above $66,667 will increase the
death benefit by $2.50. Thus, if the Policy Account Value exceeds $66,667 and
increases by $100 because of investment performance or premium payments, the
death benefit will increase by $250. An Owner with a Policy Account Value of
$75,000 will be entitled to a death benefit of $187,500 ($75,000 X 250%); a
Policy Account Value of $100,000 will yield a death benefit of $250,000
($100,000 X 250%); a Policy Account Value of $125,000 will yield a death benefit
of $312,500 ($125,000 X 250%).

Similarly, any time the Policy Account Value exceeds $66,667, each dollar
taken out of the Policy Account Value will reduce the death benefit by $2.50.
If, for example, the Policy Account Value is reduced from $75,000 to $70,000
because of partial surrenders, charges, or negative investment performance, the
death benefit will be reduced from $187,500 to $175,000. If at any time,
however, the Policy Account Value multiplied by the applicable percentage is
less than the face amount plus the Policy Account Value, then the death benefit
will be the current face amount plus the Policy Account Value of the Policy.

ALLOCATOR 2000
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<PAGE> 24

The applicable percentage becomes lower as the Insured's Attained Age
increases. If the Attained Age of the Insured in the illustration above were,
for example, 50 (rather than under 40), the applicable percentage would be 185%.
The amount of the death benefit would be the sum of the Policy Account Value
plus $100,000 unless the Policy Account Value exceeded approximately $117,647
(rather than $66,667), and each $1 then added to or taken from the Policy
Account Value would change the death benefit by $1.85 (rather than $2.50).

CHANGE IN FACE AMOUNT. Subject to certain limitations, an Owner may
increase or decrease the face amount of a Policy. A change in face amount may
affect the cost of insurance rate and the net amount at risk, both of which may
affect an Owner's cost of insurance charge. (See the section on Charges and
Deductions -- Cost of Insurance.) A change in face amount may affect whether the
Policy is a "modified endowment contract" for federal income tax purposes. (See
the section on Federal Tax Considerations.)

DECREASES. Any decrease in the face amount will become effective on the
monthly anniversary date on or following receipt by ANLIC of a written request.
Generally, no decrease in the face amount will be permitted during the first
Policy year (other than a decrease indirectly resulting from a partial
surrender) but ANLIC may waive this restriction. The face amount remaining in
force after any requested decrease may not be less than $25,000. If, following
the decrease in face amount, the Policy would not comply with the maximum
premium limitations required by federal tax law. (See the section on
Premiums -- Premium Limitations.), the decrease may be limited (or, if the
Policyholder so elects, the Policy Account Value may be returned to the Owner)
to the extent necessary to meet these requirements. For purposes of determining
the cost of insurance charge, a decrease in the face amount will reduce the face
amount in the following order:

(a) The face amount provided by the most recent increase;

(b) The next most recent increase successively; and

(See the section on Charges and Deductions--Cost of Insurance.)

INCREASES. Increases in the Face Amount will be allowed after the first
Policy year. For an increase in the Face Amount, you must submit a written
supplemental application. ANLIC may also require additional evidence of
insurability. Although an increase need not necessarily be accompanied by an
additional premium, in certain cases an additional premium will be required to
put the requested increase in effect. The minimum amount of any increase is
$25,000. An increase in the Face Amount will also increase Surrender Charges. An
increase in the Face Amount during the time either the Benchmark Premium or the
Guaranteed Death Benefit Premium is in effect will increase the respective
premium requirements. (See the section on Charges and Deductions.)

CHANGE IN DEATH BENEFIT OPTION. Generally, the death benefit option in
effect may be changed at any time by sending ANLIC a written request for change.
If the death benefit option is changed from Option B to Option A, the face
amount will be increased by an amount equal to the Policy Account Value on the
effective date of change. Changing from Option B to Option A does not require
evidence of insurability. The effective date of such a change will be the
monthly anniversary on or following receipt of the request. A change in the
death benefit option may affect whether the Policy will be treated as a
"modified endowment contract" for federal tax purposes. (See the section on
Federal Tax Considerations.)

If the death benefit option is changed from Option A to Option B, the face
amount will be decreased by an amount equal to the Policy Account Value on the
effective date of the change. This change may not be made if it would result in
a face amount less than $25,000. Changing from Option A to Option B may require
evidence of insurability satisfactory to ANLIC. The effective date of such a
change will be the monthly anniversary on or following the date the change is
approved by ANLIC.

No charges will be imposed upon a change in death benefit option, nor will
such a change in and of itself result in an immediate change in the amount of
the Policy Account Value. If, however, prior to or accompanying a change in the
death benefit option there has been an increase in the face amount, the method
of calculating the insurance charge may change. (See the section on Charges and
Deductions -- Cost of Insurance.)

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<PAGE> 25

HOW DEATH BENEFITS MAY VARY IN AMOUNT. As long as the Policy remains in
force, ANLIC guarantees that the death benefit will never be less than the
current face amount of the Policy. These proceeds will be reduced by any
outstanding indebtedness and any due and unpaid charges. The death benefit may,
however, vary with the Policy Account Value. Under Option A, the death benefit
will only vary whenever the Policy Account Value multiplied by the applicable
percentage exceeds the face amount of the Policy. The death benefit under Option
B will always vary with the Policy Account Value because the death benefit
equals either the face amount plus the Policy Account Value or the applicable
percentage of Policy Account Value.

HOW THE DURATION OF THE POLICY MAY VARY. The duration of the Policy depends
upon the Policy's Cash Surrender Value. The Policy will remain in force so long
as the Cash Surrender Value is sufficient to pay the monthly deduction. (See the
section on Charges and Deductions -- Policy Account Value Charges.) Where,
however, the Cash Surrender Value is insufficient to pay the monthly deduction
or indebtedness exceeds Policy Account Value, and a grace period expires without
an adequate payment by the Owner, the Policy will lapse and terminate without
value. Special provisions apply if the Owner has paid either the GDBP or
Benchmark Premiums. (See the section on Policy Lapse and Reinstatement --
Lapse.)

PAYMENT OF POLICY BENEFITS
Death Benefit Proceeds under the Policy will ordinarily be paid within
seven days after ANLIC receives due proof of death. Policy Account Value
benefits will ordinarily be paid within seven days of receipt of a written
request. Payments may be postponed in certain circumstances. (See the section on
Postponement of Payments.) The Owner may decide the form in which the benefits
will be paid. During the Insured's lifetime, the Owner may arrange for the Death
Benefit Proceeds to be paid in a lump sum or under one or more of the settlement
options described below. These choices are also available if the Policy is
surrendered or matures. If no election is made, ANLIC will pay the benefits in a
lump sum upon submission of due proof of death.

When Death Benefit Proceeds are payable in a lump sum, the beneficiary may
select one or more of the settlement options. If Death Benefit Proceeds become
payable under a settlement option and the beneficiary has the right to withdraw
the entire amount, the beneficiary may name and change contingent beneficiaries.

SETTLEMENT OPTIONS. Owners and beneficiaries may elect to have benefits
paid in a lump sum or in accordance with a wide variety of settlement options
offered under the Policy. Once a settlement option is in effect, there will no
longer be value in the Variable Account. ANLIC may make other settlement options
available in the future. For additional information concerning these options,
see the Policy itself.

INTEREST FOR LIFE. Interest on the amount retained will be paid during the
lifetime of the payee. When the payee dies, the amount held by ANLIC will
be paid as agreed.

INTEREST FOR A FIXED PERIOD. Interest or compound interest will be paid for
a fixed period. The fixed period cannot exceed 30 years. At the end of the
period the principal amount will be paid as agreed.

PAYMENTS FOR A FIXED PERIOD. The amount retained plus interest will be paid
in equal monthly installments for the period chosen. The period chosen may
not exceed 30 years.

PAYMENTS OF A FIXED AMOUNT. The amount retained plus interest will be paid
in equal monthly installments until the fund has been paid in full. The
total payments in any year must be at least 5% of the amount retained.

LIFE INCOME. The amount retained plus interest will be paid in equal
installments for the guaranteed payment period elected and continue for the
life of the person on whose life the option is based. Guaranteed payment
periods may be elected for 10 or 20 years, or the period in which the total
payments will equal the amount retained.

JOINT AND SURVIVOR LIFE INCOME. The amount retained plus interest will be
paid during the joint lifetime of two persons and continue during the
lifetime of the survivor. Payments are guaranteed for 10 years.

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<PAGE> 26

ADDITIONAL SETTLEMENTS. At the request of the Owner, ANLIC will pay the
amount retained in any manner acceptable to the Company.

PAYMENT AND ALLOCATION OF PREMIUMS

POLICY ISSUE
Premiums are payable at ANLIC's Administrative Office. (See the section on
Acacia National Life Insurance Company.) or to one of ANLIC's authorized agents.
A properly completed application must precede or accompany the initial premium.
No coverage will take effect unless (a) the application is approved; (b) the
first Planned Periodic Premium is paid; and (c) the Policy is accepted by the
Applicant. This must be during the lifetime of all persons proposed for
insurance. Also, their eligibility and health must remain as described in the
application.

The minimum face amount to issue a Policy is $100,000, under ANLIC's
current rules. ANLIC reserves the right to revise its rules from time to time to
specify a different minimum face amount at issue. A Policy will generally be
issued only to Insureds 80 years of age or under who supply satisfactory
evidence of insurability sufficient to ANLIC. ANLIC may, however, at its sole
discretion, issue a Policy to an individual above the age of 80. Acceptance is
subject to ANLIC's underwriting rules and ANLIC reserves the right to reject an
application for any reason. The Policy Date is the date used to determine Policy
years and Policy Months. If a premium is submitted with the application,
insurance coverage will begin as of the Policy Date. If a premium is not paid
with the application, the Policy Date will ordinarily be approximately 15 days
after underwriting approval. Insurance coverage will begin on the later of the
Policy date or the date the premium is received. A Policy Date may also be any
other date mutually agreeable to ANLIC and the Owner. ANLIC will allocate net
premiums on the later of the Policy Date or the date the premium is received.
(See the section on Allocation of Premiums and Policy Account Value.)

PREMIUMS
Subject to certain limitations, an Owner has flexibility in determining the
frequency and amount of premiums.

PREMIUM FLEXIBILITY. Unlike conventional insurance policies, this Policy
frees the Owner from the requirement that premiums be paid in accordance with a
rigid and inflexible premium schedule. You must pay the first Planned Periodic
Premium for coverage to take effect. Thereafter, subject to the minimum and
maximum premium limitations described below, an Owner may make unscheduled
premium payments at any time in any amount. The Policy, therefore, provides the
Owner with the flexibility to vary the frequency and amount of premium payments
to reflect changing financial conditions. The level of premium payments is an
important factor in determining whether the Policy will be treated as a
"modified endowment contract" for federal tax purposes. (See the section on
Federal Tax Considerations.)

PLANNED PERIODIC PREMIUMS. Each Owner will determine a Planned Periodic
Premium schedule that provides for the payment of a level premium at a fixed
interval over a specified period of time. The Owner is not required to pay
premiums in accordance with this schedule. Furthermore, the Owner has
considerable flexibility to alter the amount, frequency, and the time period
over which Planned Periodic Premiums are paid.

The payment of a Planned Periodic Premium will not guarantee that the
Policy remains in force. Instead, the duration of the Policy depends upon the
Policy Account Value. Thus, even if planned periodic premiums are paid by the
Owner, the Policy will nonetheless lapse at any time indebtedness exceeds Policy
Account Value or the Cash Surrender Value is insufficient to pay certain monthly
charges, and a grace period expires without a sufficient payment. (See the
section on Policy Lapse and Reinstatement -- Lapse.) Exceptions may occur if the
Owner pays an amount equal to or greater than either the scheduled Benchmark
Premiums or Guaranteed Death Benefit Premiums.

BENCHMARK PREMIUMS. When the Owner pays the monthly Benchmark Premiums as
stated in the Policy and if the sum of the premiums paid equals or exceeds the
sum of the scheduled Benchmark Premiums for the face amount and any increase,
then the Policy is guaranteed not to lapse during the first

ALLOCATOR 2000
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<PAGE> 27

five years that the Policy is in force. Payment of only the Benchmark Premium
may reduce the flexibility of premium payments.

GUARANTEED DEATH BENEFIT PREMIUM ("GDBP"). The Owner may also elect to pay
a GDBP premium for the Policy or any increase in coverage. The GDBP premium is
stated in the Policy and is calculated based on the Face Amount and the
Insured's age, sex and rate class at the time coverage is applied for. Provided
GDBP is paid and the Owner makes no loans or partial surrenders, the Policy is
guaranteed not to lapse before the Insured reaches age 65 or for ten years from
the effective date of coverage, whichever is later.

For all Policies sold in the State of Maryland, all references to the
phrases "the Guaranteed Death Benefit" and the "Guaranteed Death Benefit
Premium" are replaced with the phrases "Extended No Lapse Guarantee" and
"Extended No Lapse Guarantee Premium." For all Policies sold in the Commonwealth
of Massachusetts, the Guaranteed Death Benefit Premium does not apply.

PREMIUM LIMITATIONS. In no event may the total amount of all premiums paid,
both scheduled and unscheduled, exceed the current maximum premium limitations
which are required by federal tax laws. If at any time a premium is paid which
would result in total premiums exceeding the current maximum premium limitation,
ANLIC will only accept that portion of the premium which will make total
premiums equal the maximum limitation. Any part of the premium in excess of that
amount will be returned and no further premiums will be accepted until allowed
by the current maximum premium limitations set forth in the Policy. Every
premium payment, whether scheduled or unscheduled, must be at least $25. Premium
payments less than this minimum amount will be returned to the Owner.

PAYMENT OF PREMIUMS. Payments made by the Owner will be treated first as
payment of premium, not indebtedness unless the Owner indicates that the payment
should be treated otherwise. Charges will be deducted from each premium payment
as stated in the Policy. (See the section on Charges and Deductions -- Premium
Expense Charges.)

ALLOCATION OF PREMIUMS AND POLICY ACCOUNT VALUE
NET PREMIUM. The net premium equals the premium paid less the premium
expense charge. (See the section on Charges and Deductions -- Premium Expense
Charges.)

ALLOCATION OF NET PREMIUMS. In the application for a Policy, the Owner may
allocate net premiums or portions thereof to the Investment Options. The portion
of the net premium allocated to Sub-accounts will be allocated initially to the
Money Market Portfolio on the Policy Date or the date the first premium is
received by ANLIC, whichever is later. After 15 days, the Policy Account Value
will be allocated among the Investment Options according to the instructions in
your application.

Net premiums paid after the expiration of the initial fifteen day period
will be allocated in accordance with the Owner's instructions in the application
as of the end of the Valuation Date in which they are received. The minimum
percentage of each premium that may be allocated to the Fixed Account or any
Sub-account is 5%; percentages must be in whole numbers. The allocation for
future net premiums may be changed without charge at any time by providing ANLIC
with written notification. No charge is imposed for any reallocations. No more
than ten different Sub-accounts may be chosen to receive premium payments.

The value of amounts allocated to Sub-accounts will vary with the
investment experience of these Sub-accounts and the Owner bears the entire
investment risk. Owners should periodically review their allocations of premiums
and values in light of market conditions and overall estate planning
requirements.

TRANSFERS
TRANSFERS FROM THE GENERAL ACCOUNT. The Owner may ask to transfer value
from the General Account, up to a maximum each Policy year of 25% of the General
Account Value as of the last Policy anniversary date. The minimum amount each
that may be transferred is $100. During the first Policy year, the Owner may
transfer a maximum of 25% of the General Account Value on the transfer date.

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TRANSFERS FROM SUB-ACCOUNTS. The Owner may ask ANLIC to transfer all or
part of the amount in one of the Sub-accounts to another Sub-account or to the
General Account. The minimum amount for such transfer is $50. The transfer will
be made as of the date ANLIC receives the written request.

AUTOMATIC REBALANCING AND DOLLAR COST AVERAGING PROGRAMS. The Owner may
also elect from either the Automatic Rebalancing Program or the Dollar Cost
Averaging Program by filing a written authorization with ANLIC. ANLIC reserves
the right to alter, including the right to assess a charge, or terminate these
administrative programs upon 30 days advance written notice.

Under the Automatic Rebalancing Program, the Owner may have automatic
transfers on either a monthly, quarterly, semi-annual or annual basis, to adjust
the values among the Sub-accounts and the General Account to meet the Owner's
designated percentage account value proportions the Owner has on file with
ANLIC. The allocations are subject to a minimum 5% designated percentage
proportion per account.

Under the Dollar Cost Averaging Program, the Owner may elect to have a
specific dollar amount automatically transferred from the Money Market
Sub-account to designated Sub-accounts on either a monthly, quarterly,
semi-annual, or annual basis. The specific dollar amount is subject to a $50
minimum transfer amount pursuant to the Owner's election with a minimum 5%
designated percentage proportion per Sub-account. If the periodic transfer would
reduce the value in the Money Market Sub-account below the specific dollar
amount, ANLIC reserves the right to include the entire remaining value to meet
the transfer election. ANLIC also reserves the right to establish a minimum
Money Market Sub-account balance before we allow you to elect the program.

Transfers and adjustments pursuant to these Programs will occur on the
Policy's Monthly Anniversary date in the month in which the transaction is to
take place or the next succeeding business day if the Monthly Anniversary date
falls on a day other than a Valuation Date. For more information on asset
allocation programs, see Appendix B.

TELEPHONE AND ELECTRONIC TRANSFER REQUESTS. At the time an application for
a Policy is completed, or at any subsequent time, an Owner may request a
telephone transfer authorization form. If the form is properly completed and on
file with ANLIC, transfers may be made pursuant to telephone instructions,
subject to the above terms and the terms of the authorization form. Otherwise,
transfer requests must be in writing in a form acceptable to ANLIC. Transfer
requests made by telephone are processed upon the date of receipt, if received
prior to 4:00 p.m. Eastern Time. ANLIC may, at any time, revoke or modify the
transfer privilege. When available, procedures for making transfers through our
website can be accessed at the Internet address stated in the Acacia National
Life Insurance Company section of this prospectus.

POLICY LAPSE AND REINSTATEMENT
LAPSE. Unlike conventional life insurance policies, the failure to make a
Planned Periodic Premium payment will not itself cause the Policy to lapse.
Lapse will occur when the Cash Surrender Value is insufficient to cover the
monthly deduction and a Grace Period expires without a sufficient payment,
unless the Benchmark Premium or Guaranteed Death Benefit provision is in effect.
The Grace Period is 62 days from the date ANLIC mails you a notice that the
Grace Period has begun. ANLIC will notify you at the beginning of the Grace
Period by mail addressed to your last known address on file with ANLIC. The
notice will specify the premium required to keep the Policy in force. The
required premium will equal the lesser of 1) monthly deductions plus Premium
Expense Charges for the three Policy Months after commencement of the Grace
Period, plus projected loan interest that would accrue over that period, or 2)
the premium required under the Benchmark Premium or Guaranteed Death Benefit
provisions, if applicable, to keep the Policy in effect for three months from
the commencement of the Grace Period. Failure to pay the required premium within
the Grace Period will result in lapse of the Policy. If the Insured dies during
the Grace Period, any indebtedness and past due charges will be deducted from
the Death Benefit Proceeds.

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REINSTATEMENT. A lapsed Policy may be reinstated any time within 5 years
after the date of lapse and before the maturity date by submitting the following
items to ANLIC:

1. A written application for reinstatement;

2. Evidence of insurability satisfactory to ANLIC; and

3. A premium that, after the deduction of premium expense charges, is large
enough to cover the monthly deductions for at least three Policy Months
commencing with the effective date of reinstatement for the Policy and
any rider benefits. Any indebtedness on the date of lapse must be paid
at the time of reinstatement.

Upon approval of the application for reinstatement, the effective date of
reinstatement will be the monthly anniversary on or prior to the date of
approval.

To the extent permitted under state law, ANLIC may contest the
reinstatement of the Policy, and any rider attached, for any statements made in
the application for reinstatement, until it has been in force during the
lifetime of the Insured for two years from the effective date of reinstatement.

CHARGES AND DEDUCTIONS

Charges will be deducted in connection with the Policy and any optional
insurance benefits added by rider to compensate ANLIC for: (1) providing the
insurance benefits set forth in the Policy and any riders; (2) administering the
Policy; (3) assuming certain risks in connection with the Policy; and (4)
incurring expenses in distributing the Policy and any riders. The nature and
amount of these charges are described more fully below.

SURRENDER CHARGE
Surrender Charges will not exceed the maximum charges as specified in the
Policy. The surrender charge for the original face amount is determined by
multiplying a surrender charge factor by the actual premiums paid up to Target
Premium. The Surrender Charge factor depends on the number of years the Policy
has been in force, as follows:

<TABLE>
<CAPTION>
POLICY YEAR SURRENDER CHARGE FACTOR
----------- -----------------------
<S> <C>
1-7....................................................... 30%
8......................................................... 20%
9......................................................... 10%
10+....................................................... 0%
</TABLE>

Paying less premium may reduce the surrender charge but will increase the
cost of insurance for the Policy and may cause the Policy to lapse.

Surrender Charges for any increase in face amount will be based solely on
the Target Premium associated with the increase as stated in the Policy. The
maximum surrender charge for an increase in face amount is 30% of the Target
Premium for the increase during the seven years following the increase, and then
declines by 10% per year until it reaches 0% in the tenth year following the
increase. Surrender Charges are computed separately for the original face amount
and each increase in face amount, and then combined.

PARTIAL SURRENDER CHARGE
During the surrender charge period for the Policy and any increase, there
will be a charge for a partial surrender equal to 8% of the amount withdrawn or
$25, whichever is greater. Partial Surrender Charges will reduce the remaining
Surrender Charge.

PREMIUM EXPENSE CHARGE
ANLIC will deduct 2.25% from each premium before allocation to the
Investment Options. The deduction represents an amount ANLIC considers necessary
to pay all premium taxes imposed by the states and any subdivisions thereof and
does not necessarily equal the premium taxes paid by ANLIC for a particular
Policy.

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POLICY ACCOUNT VALUE CHARGES
MONTHLY DEDUCTION. On each Monthly Anniversary, a charge will be deducted
from the Policy Account Value to compensate ANLIC for administrative expenses
and insurance provided. The monthly deduction consists of the cost of insurance,
the administrative expense charge, and charges for any optional insurance
benefits added by riders. The monthly deduction will be allocated pro-rata among
the Investment Options.

COST OF INSURANCE. Because the cost of insurance depends upon a number of
variables, the cost for each Policy month can vary from month to month. ANLIC
will determine the monthly cost of insurance charge by multiplying the
applicable cost of insurance rate or rates by the net amount at risk for each
Policy Month. The net amount at risk for a Policy Month is based on the
difference between the Death Benefit and the Policy Account Value on the Monthly
Anniversary.

COST OF INSURANCE RATE. Cost of insurance rates will be based on the Face
Amount and the Insured's sex, Issue Age, Policy duration, and rate class. The
rates reflect ANLIC's expectations of future experience with regard to
mortality, interest, persistency, and expenses, but will not exceed the Schedule
of Guaranteed Annual Cost of Insurance Rates shown in the Policy. For standard
risks, these guaranteed rates are based on the 1980 Commissioners Standard
Ordinary Mortality Table with smoker and non-smoker distinction and the
Insured's sex (unless unisex rates are required by law). Any change in the cost
of insurance rates will apply to all Insureds of the same Issue Age, sex, rate
class, and whose Policies have been in force for the same length of time.

The cost of insurance rate will also depend on the face amount of the
Policy. At ANLIC's discretion, a Policy with a face amount in excess of $500,000
may incur a lower cost for each thousand dollars of net amount at risk than an
otherwise identical Policy with a face amount less than that amount. ANLIC may,
at its sole discretion, reduce the cost of insurance for other face amounts.
Because the cost of insurance rate varies with the face amount, any increase or
decrease in face amount, including those resulting from a change in the death
benefit option and those resulting from partial surrenders, may affect the cost
of insurance.

RATE CLASS. The rate class of an Insured will affect the cost of insurance
rate. ANLIC currently places Insureds into standard rate classes or substandard
rate classes involving higher mortality risk. In an otherwise identical Policy,
an Insured in the standard rate class will have a lower cost of insurance rate
than an Insured in a substandard rate class.

ADMINISTRATIVE EXPENSE CHARGE. As reimbursement for administrative expenses
related to the maintenance of each Policy and the Variable Account, ANLIC
assesses a charge of $27 per Policy Month during the first Policy Year and $8
per Policy Month thereafter. ANLIC does not anticipate that it will make any
profit on this charge.

OPTIONAL INSURANCE BENEFITS CHARGES. The monthly deduction will include
charges for any optional insurance benefits added to the Policy by rider. (See
the section on Optional Insurance Benefits.)

DAILY CHARGES AGAINST THE VARIABLE ACCOUNT
MORTALITY AND EXPENSE RISK CHARGE. ANLIC has developed a new method of
calculating mortality and expense charges which it believes is more favorable to
Policy Owners. As compensation for mortality and expense risks assumed in
connection with the Policy, ANLIC will deduct a daily mortality and expense risk
charge from the value of the net assets of the Variable Account. For the first
15 years of your Policy, this charge is at the rate of 0.90% annually
(0.0024590% daily). Beginning in the 16th Policy year, this charge is reduced by
0.05% annually until it reaches 0.45% annually (0.0012295% daily) in Policy year
24; the rate remains level thereafter. The daily charge will be deducted from
the net asset value of the Variable Account, and therefore the Sub-accounts, on
each Valuation Date. Where the previous day or days was not a Valuation Date,
the deduction on the Valuation Date will be the applicable daily rate multiplied
by the number of days since the last Valuation Date. No mortality and expense
risk charges will be deducted from the amounts in the Fixed Account.

The mortality risk assumed by ANLIC is that Insureds may live for a shorter
time than projected, and that an aggregate amount of Death Benefit Proceeds
greater than that projected will be payable. The

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<PAGE> 31

expense risk assumed is that expenses incurred in issuing and administering the
Policies will exceed the limits on administrative charges set in the Policies,
which are in excess of the amount necessary to meet expenses currently. If the
expenses do not increase to an amount in excess of the limits, ANLIC may profit
from this charge. Any shortfall in meeting the distribution expenses will be met
from ANLIC's general corporate funds which may include profit from the mortality
and expense risk charge. ANLIC also assumes risks with respect to other
contingencies, including the pattern of transfers between the Variable Account
and the General Account which may cause ANLIC to incur greater costs than
anticipated.

TAXES. Currently no charge is made to the Variable Account for federal
income taxes that may be attributable to the Variable Account. ANLIC may,
however, make such a charge in the future. Charges for other taxes, if any,
attributable to the Variable Account may also be made. (See the section on
Federal Tax Considerations.)

INVESTMENT ADVISORY FEE

Policyowners who choose to allocate Net Premiums to one or more of the
Sub-accounts will also bear a pro rata share of the investment advisory fee paid
by each of the investment portfolios in which the various Sub-accounts invest.
(See the Summary section on Fund Expense Summary.) No such fees are assessed
against Net Premiums allocated to the Fixed Account . (See the section on
General Account.)

ANLIC may receive administrative fees from the investment advisers of
certain Funds.

REDUCTION OF CHARGES
ANLIC may reduce monthly administration charges, other charges, and the
minimum initial face amount in special circumstances that result in lower sales,
administrative or mortality expenses. For example, special circumstances may
exist in connection with group or sponsored arrangements, sales to Policyowners
of ANLIC or its affiliates, or sales to employees or clients of subsidiaries and
affiliates of Ameritas Acacia Mutual Holding Corporation. Group arrangements
include those in which a trustee or an employer, for example, purchases
contracts covering a group of individuals on a group basis. Sponsored
arrangements include those in which an employer allows us to sell contracts to
its employees on an individual basis. The amounts of any reductions will reflect
the reduced sales effort and administrative costs resulting from, or the
different mortality experience expected as a result of, the special
circumstances. Reductions will not be unfairly discriminatory against any
person, including the affected Owners and Owners of all other policies funded by
the Variable Account.

POLICY RIGHTS

LOAN PRIVILEGES

POLICY LOAN. The Owner may borrow money from ANLIC using the Policy as the
only security for the loan. The maximum amount that may be borrowed at any time
is the loan value. The loan value equals 90% of the Cash Surrender Value. The
minimum loan request ANLIC allows is $1,000. Loans usually are paid within seven
days after ANLIC receives a written request. Loans have priority over the claims
of any assignee or other person. The loan may be repaid all or in part at any
time while the Insured is living. Loans from certain Policies may be taxed as
Distributions. (See the section on Federal Tax Considerations.)

INTEREST. ANLIC charges interest on Policy loans at regular and reduced
rates. Regular loans will accrue interest at the daily equivalent of 6.45% per
year. After the fifth Policy year, you may borrow a limited amount of the Cash
Surrender Value at a reduced rate. Reduced rate loans will accrue interest at
the daily equivalent of 4.50% per year. The amount available at the reduced loan
rate is (1) the Policy Account Value, minus (2) total premiums paid minus any
partial surrenders previously taken, and minus (3) any indebtedness held at a
reduced rate. However, this amount may not exceed the maximum loan amount
described above. If unpaid when due, interest will be added to the amount of the
loan and bear interest at the same rate.

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EFFECT OF POLICY LOANS. When a loan is made, Policy Account Value equal to
the amount of the loan will be transferred from the Investment Options to the
General Account as security for the loan. The Policy Account Value transferred
will be allocated from the Investment Options according to the instructions you
give when you request the loan. If no instructions are given, the amounts will
be transferred first from the Fixed Account. Any excess amount will be
transferred from the sub-accounts in the same proportion that the Policy Account
Value in each Sub-account bears to the Variable Account Value.

Value in the General Account held as security for the loan will be credited
with interest at 4.5% per year. NO ADDITIONAL INTEREST WILL BE CREDITED TO THIS
VALUE. The interest earned will be credited once each Policy Month. Upon partial
repayment of indebtedness, value in the General Account equal to the amount of
repayment will be released as security for the loan, and may be reallocated by
the owner among the Investment Options. Upon full repayment of indebtedness, all
collateral in the General Account may be reallocated by the Owner to the
Investment Options.

Interest earned on amounts held in the General Account will be allocated to
the Investment Options on each Policy anniversary in the same proportion that
Net Premiums are being allocated to the Investment Options at the time.

INDEBTEDNESS. Indebtedness equals the total of all Policy Loans and accrued
interest on Policy loans. If indebtedness exceeds Policy Account Value less
Surrender Charges, ANLIC will notify the Owner and any assignee of record. If a
sufficient payment equal to excess indebtedness is not made to ANLIC within 62
days from the date notice is sent, the Policy will lapse and terminate without
value. The Policy, however, may later be reinstated. (See the section on Policy
Lapse and Reinstatement.)

REPAYMENT OF INDEBTEDNESS. Indebtedness may be repaid any time before the
Maturity Date. (See the section on Payment of Policy Benefits.) ANLIC will
deduct indebtedness from any amount payable under the Policy. Payments made by
the Owner will be treated first as payment of premium and not as repayment of
any outstanding Policy debt unless the Owner indicates that the payment should
be treated otherwise. Loan repayments are not subject to the Premium Expense
Charge.

SURRENDER PRIVILEGES
The Owner may surrender the Policy for its Cash Surrender Value on any
Valuation Date during the lifetime of the Insured by sending a written request
to ANLIC. The amount available for surrender is the Cash Surrender Value at the
end of the Valuation Period during which the surrender request is received at
ANLIC's principal office. The Cash Surrender Value equals the Policy Account
Value less the surrender charge and indebtedness. Surrenders from the Variable
Account will generally be paid within seven days of receipt of the written
request. Postponement of payments may, however, occur in certain circumstances.
(See the section on Postponement of Payments.) Surrenders may have adverse tax
consequences. (See the section on Federal Tax Considerations.)

A surrender charge is imposed if the Policy is surrendered either partially
or totally. For partial surrenders, the charge is 8% of the amount withdrawn or
$25, whichever is greater, but will never exceed the charges for a total
surrender. Decreases do not affect Surrender Charges, since Surrender Charges
for coverage associated with the decrease will be taken at the time of Policy
lapse or surrender.

The Policy surrender charge is a product of a surrender charge factor
multiplied by the actual premium paid up to the Target Premium from the Policy
Date or the Increase Date of any increase in face amount, as applicable. The
factor varies by the year of surrender measured from the Policy Date or increase
date, as applicable. (The surrender charge will never exceed the Policy Account
Value.) Any charge assessed for a partial surrender will reduce the remaining
surrender charge dollar for dollar.

PARTIAL SURRENDER
After the first Policy year, you may partially surrender the Policy on any
Valuation Date during the lifetime of the Insured by sending us a written
request. The amount of the partial surrender must not exceed the Cash Surrender
Value. You may place on file with us a written request for systematic partial
surrenders. The partial surrenders may be monthly, quarterly or annually in
amounts of no less than $100.

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Unless you request otherwise, the partial surrender will be allocated among
the Investment Options in the same proportion that the Policy's value in each
Investment Option bears to the total Policy Account Value in the Investment
Options on the Valuation Date we receive the request.

Any partial surrender will reduce the Policy Account Value by the amount of
the partial surrender. The amount of reduction in the face amount will be:

1. For Death Benefit Option A, 100% of the amount of the partial surrender.

2. For Death Benefit Option B, no reduction.

The face amount remaining in force after a partial surrender may not be
less than the minimum face amount ANLIC allows.

Each partial surrender will reduce the face amount in the following order:

1. Each increase in order, starting with the last increase; and

2. The face amount when the Policy was issued.

For a partial surrender, the amount paid will be deducted from the Policy
Account Value at the end of the Valuation Period during which the request is
received.

COVERAGE BEYOND THE MATURITY DATE
Unless prohibited under state law, you may elect to continue coverage
beyond the Maturity Date provided the Policy is in force on the Maturity Date.
If you so elect, on the Maturity Date the Variable Account Value will be
transferred to the General Account where it will continue to earn interest as
described in the Policy. Monthly deduction amounts will continue to be deducted,
with the Cost of Insurance Rate equal to zero. Only payments required to keep
the Policy in force will be accepted beyond the Maturity Date. All other rights
and benefits as described in the Policy will be available.

The Policy may be subject to certain adverse tax consequences when
continued beyond the Maturity Date.

EXAMINATION OF THE POLICY PRIVILEGE ("FREE LOOK")

You may cancel the Policy within 20 days after you receive it or within 45
days of completing Part I of the application, whichever is later. You should
mail or deliver the Policy to either our Administrative Service Office. (See the
section on Acacia National Life Insurance Company.) or the registered
representative who sold the Policy. If the Policy is canceled within the Free
Look Period, ANLIC will refund the total premium paid. A refund of premium paid
by check may be delayed until the check has cleared the Owner's bank. This
privilege also applies to an increase for coverage under the Policy. (See the
section on Postponement of Payments.)

GENERAL ACCOUNT

You may allocate net premiums and transfer value to the General Account of
ANLIC via an allocation to the Fixed Account. Because of exemptive and
exclusionary provisions, interests in the General Account have not been
registered as securities under the Securities Act of 1933, as amended (the "1933
Act") and the General Account has not been registered as an investment company
under the 1940 Act. Accordingly, neither the General Account nor any interests
therein are subject to the provisions of these Acts and, as a result, the staff
of the SEC has not reviewed the disclosures in this Prospectus relating to the
General Account.

GENERAL DESCRIPTION
The General Account consists of all assets owned by ANLIC other than those
in the Variable Account and other separate accounts. Subject to applicable law,
ANLIC has sole discretion over the investment of the assets in the General
Account.

You may elect to allocate net premiums to the Fixed Account, the Variable
Account, or both. You may also transfer value from the Sub-accounts to the Fixed
Account, or from the Fixed Account to the

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<PAGE> 34

Sub-accounts. The allocation or transfer of funds to the Fixed Account does not
entitle an Owner to share in the investment experience of the General Account.
Instead, ANLIC guarantees that value in the Fixed Account will accrue interest
at an effective annual rate of at least 4.5%, independent of the actual
investment experience of the General Account. Any excess interest rate when
declared will remain in effect at least one year.

THE POLICY
This Prospectus describes a Flexible Premium Variable Life Insurance
Policy. This Prospectus is generally intended to serve as a disclosure document
for the aspects of the Policy involving the Variable Account. For complete
details regarding the General Account, see the Policy itself.

GENERAL ACCOUNT VALUE
Net premiums allocated to the General Account via the Fixed Account are
credited to the Policy. ANLIC bears the full investment risk for these amounts.
ANLIC guarantees that interest credited to the Fixed Account will not be less
than 4.5% per year. ANLIC MAY, AT ITS SOLE DISCRETION, CREDIT A HIGHER RATE OF
INTEREST, although it is not obligated to credit interest in excess of 4.5% per
year, and might not do so. ANY INTEREST CREDITED TO THE FIXED ACCOUNT IN EXCESS
OF THE GUARANTEED RATE OF 4.5% PER YEAR WILL BE DETERMINED IN THE SOLE
DISCRETION OF ANLIC. THE OWNER ASSUMES THE RISK THAT INTEREST CREDITED MAY NOT
EXCEED THE GUARANTEED MINIMUM RATE OF 4.5% PER YEAR. The value in the Fixed
Account will be calculated on each Monthly Anniversary.

ANLIC guarantees that, at any time prior to the Maturity Date, the value in
the Fixed Account will not be less than the amount of the net premiums allocated
or value transferred to the Fixed Account, plus interest at the rate of 4.5% per
year, plus any excess interest which ANLIC credits and any amounts transferred
into the Fixed Account, less the sum of all charges allocable to the Fixed
Account and any amounts deducted from the Fixed Account in connection with
partial surrenders or transfers to the Variable Account.

GENERAL POLICY PROVISIONS

POSTPONEMENT OF PAYMENTS
GENERAL. Payment of any amount upon complete or partial surrender, Policy
loan, or benefits payable at death or Maturity may be postponed whenever: (1)
ANLIC or the New York Stock Exchange is closed such as customary weekend and
holiday closings, or trading on the New York Stock Exchange is restricted as
determined by the SEC; (2) the SEC by order permits postponement for the
protection of Owners; or (3) an emergency exists, as determined by the SEC, as a
result of which disposal of securities is not reasonably practicable or it is
not reasonably practicable to determine the value of the Variable Account's net
assets. Transfers may also be postponed under these circumstances.

PAYMENT BY CHECK. Payments under the Policy of any amounts derived from
premiums paid by check may be delayed until such time as the check has cleared
the Owner's bank.

THE CONTRACT
The Policy, riders and attached copy of the application and any
supplemental applications are the entire contract. Only statements in the
application and any supplemental applications can be used to void the Policy or
defend a claim. The statements are considered representations and not
warranties. Only Officers of ANLIC can agree to change or waive any provisions
of the Policy. The change or waiver must be in writing and signed by an officer
of ANLIC.

SUICIDE
In most states, if the Insured, while sane or insane, commits suicide
within two years after the Policy Date, ANLIC will pay only the premium
received, less any partial surrenders and outstanding indebtedness. If the
Insured, while sane or insane, commits suicide within two years after the
effective date of any increase in face amount requiring evidence of
insurability, ANLIC will not pay the increase but will pay only an amount equal
to the monthly deductions previously made for the increase.

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INCONTESTABILITY
ANLIC cannot contest this Policy or any attached rider after it has been in
force for two years from its effective date. It cannot contest an increase in
face amount or in rider face amount after it has been in force for two years
from its effective date. Reinstatement of a Policy, and any rider attached to
the Policy, may be contested by ANLIC for any statements made in the application
for reinstatement any time within two years of the effective date of
reinstatement.

CHANGE OF OWNER OR BENEFICIARY
Generally, as long as the Policy is in force, the Owner or Beneficiary may
be changed by written request in a form acceptable to ANLIC. The Policy need not
be returned unless requested by ANLIC. The change will take effect as of the
date the request is signed, whether or not the Insured is living when the
request is received by ANLIC. ANLIC will not, however, be liable for any payment
made or action taken before acknowledgment of the request. A change of Owner or
Beneficiary may have tax consequences. (See the section on Federal Tax
Considerations.)

COLLATERAL ASSIGNMENT
The Policy may be assigned as collateral. ANLIC will not be bound by the
assignment until a copy has been received by ANLIC and it assumes no
responsibility for determining whether an assignment is valid or the extent of
the assignee's interest. An Assignment may have tax consequences. (See the
section on Federal Tax Considerations.)

MISSTATEMENT OF AGE OR SEX
If the age or sex of the Insured has been misstated, the benefits will be
those which the monthly deductions would have provided for the correct age and
sex. In the case of policies issued with unisex rates, if the age of the Insured
has been misstated, the benefits will be those which the monthly deductions
would have provided for the correct age.

REPORTS AND RECORDS
ANLIC will maintain all records relating to the Variable Account. ANLIC
will mail to Owners, at their last known address of record, any reports required
by applicable law or regulation. Each Owner will also be sent an annual and
semi-annual report for Portfolios of the Funds that hold or have held Policy
value during the reporting period and a list of the portfolio securities held in
each Portfolio of the Funds, as required by the 1940 Act.

OPTIONAL INSURANCE BENEFITS
Subject to certain requirements, one or more of the following optional
insurance benefits may be added to a Policy by rider. The cost of any optional
insurance benefits will be deducted as part of the monthly deduction. (See the
section on Charges and Deductions -- Monthly Administration Charge.)

ACCELERATED DEATH BENEFIT RIDER. Subject to certain terms and conditions, a
reduced death benefit will be paid in advance to the Owner of the Policy if the
Insured suffers from a terminal illness or injury. There is no charge for this
rider but it will be subject to ANLIC's underwriting requirements. If certain
requirements are satisfied, however, accelerated Death Benefit Proceeds paid
under the Accelerated Death Benefit Rider to a terminally or chronically ill
insured individual as defined in the Code, may not be subject to tax. A
qualified tax advisor should be consulted before adding such a rider to a
Policy.

OTHER INSURED RIDER. Provides for level renewable term insurance on the
life of any family member. Under the terms of this rider, ANLIC will pay the
face amount of the rider to the Beneficiary upon receipt of proof of the other
Insured's death. Subject to certain restrictions, the face amount of the rider
may be increased or decreased. This rider may also be converted to a new Policy
on the family member within 31 days after the Insured's death. Generally, the
new Policy must meet the minimum face amount requirement, but ANLIC, in its sole
discretion, may waive this provision. Additional evidence of insurability will
not be required for conversion.

CHILDREN'S INSURANCE RIDER. Provides for level term insurance on the
Insured's children, as defined in the rider. Under the terms of the rider, the
death benefit will be payable to the named Beneficiary upon

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the death of any Insured child. Upon receipt of proof of the Insured's death,
the rider will continue in force without additional monthly charges.

GUARANTEED INSURABILITY RIDER. Provides that the Owner can purchase
additional insurance at certain future dates without evidence of insurability.
Under the terms of the rider the Owner may only increase the face amount of the
Policy on an option date. An option date falls on the Policy Anniversary
following certain birthdates and the Monthly Anniversary following the
occurrence of certain events such as marriage of the Insured. Each increase in
face amount will be subject to the maximum stated in the Policy. No evidence of
insurability is required for any increase made under this rider. Increases may
have tax consequences. (See the section on Federal Tax Considerations.)

ACCIDENTAL DEATH BENEFIT RIDER. Provides additional insurance if the
Insured's death results from accidental bodily injury, as defined in the rider.
Under the terms of the rider, the additional benefits provided in a Policy will
be paid upon receipt of proof by ANLIC that death resulted directly and
independently of all other causes from accidental bodily injury; occurred while
the rider was in force; and occurred on or after the rider anniversary following
the Insured's 5th birthday. The rider will terminate on the earliest of either
the date of lapse, the rider anniversary following the Insured's 70th birthday
or the Maturity Date of the Policy.

LEVEL RENEWABLE TERM RIDER. Provides for level renewable term insurance
coverage to increase the face amount of the Policy. The Owner may purchase
additional insurance on a renewable term basis without evidence of insurability
up to Insured's age 70. The rider will terminate on the earliest of either the
date lapse, the rider anniversary following the Insured's 70th birthday or the
Maturity Date of the Policy.

TOTAL DISABILITY RIDER. Provides for the payment of the total disability
amount by ANLIC as premiums while the Owner is disabled. Under the terms of the
rider, the total disability amount will be paid as a premium upon receipt of
proof adequate to ANLIC that: (1) the Insured is totally disabled as defined in
the rider; (2) the disability commenced while the rider was in force; (3) the
disability began on or after the rider anniversary following the Insured's 15th
birthday; and (4) total disability continued without interruption for four
months. The total disability amount is set forth in the Policy. The amount may,
under certain circumstances, be increased. Evidence of insurability will
generally be required for any increase. Because the total disability amount is a
fixed dollar amount while the monthly deduction varies from month to month, the
fixed dollar amount may be more or less than the amount necessary to keep the
Policy in force.

Upon approval of the claim, ANLIC will begin crediting total disability
amounts, less premium expense charges, on the Monthly Anniversary after the date
disability began. No amount will be credited for a period of more than 12 months
before notice of disability is received by ANLIC unless it is shown that notice
was given as soon as reasonably possible. ANLIC will continue to credit the net
total disability amount while the Insured is totally disabled and the Policy is
in force. However, if the disability begins on or after the rider Anniversary
after the Insured's 60th birthday, payment will be credited only for the later
of two years or until the rider Anniversary after the Insured's 65th birthday.

FEDERAL TAX CONSIDERATIONS

INTRODUCTION
The following summary provides a general description of the federal income
tax considerations associated with the Policy and does not purport to be
complete or to cover all situations. This discussion is not intended as tax
advice. No attempt has been made to consider in detail any applicable state or
other tax laws except premium taxes. This discussion is based upon ANLIC's
understanding of the relevant laws at the time of filing. Counsel or other
competent tax advisors should be consulted for more complete information before
a Policy is purchased. ANLIC makes no representation as to the likelihood of the
continuation of present federal income tax laws nor of the interpretations by
the Internal Revenue Service. Federal tax laws are subject to change and thus
tax consequences to the Insured, Policy Owner or Beneficiary may be altered.

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(1) TAXATION OF ANLIC. ANLIC is taxed as a life insurance company under Part I
of Subchapter L of the Internal Revenue Code of 1986, (the "Code".) At this
time, since Separate Account I is not a separate entity from ANLIC, and its
operations form a part of ANLIC, it will not be taxed separately as a "regulated
investment company" under Subchapter M of the Code. Net investment income and
realized net capital gains on the assets of Separate Account I are reinvested
and automatically retained as a part of the reserves of the Policy and are taken
into account in determining the Death Benefit and Accumulation Value of the
Policy. ANLIC believes that Separate Account I net investment income and
realized net capital gains will not be taxable to the extent that such income
and gains are retained as reserves under the Policy.

ANLIC does not currently expect to incur any federal income tax liability
attributable to Separate Account I with respect to the sale of the Policies.
Accordingly, no charge is being made currently to Separate Account I for federal
income taxes. If, however, ANLIC determines that it may incur such taxes
attributable to Separate Account I, it may assess a charge for such taxes
against Separate Account I.

ANLIC may also incur state and local taxes (in addition to premium taxes
for which a deduction from premiums is currently made). At present, they are not
charges against Separate Account I. If there is a material change in state or
local tax laws, charges for such taxes attributable to Separate Account I, if
any, may be assessed against Separate Account I.

(2) TAX STATUS OF THE POLICY. The Code (Section 7702) includes a definition of a
life insurance contract for federal tax purposes, which places limitations on
the amount of premiums that may be paid for the Policy and the relationship of
the Accumulation Value to the Death Benefit. ANLIC believes that the Policy
meets the statutory definition of a life insurance contract.

The Code (Section 7702A) also defines a "modified endowment contract" for
federal tax purposes. If a life insurance policy is classified as a modified
endowment contract, distributions from it (including loans) are taxed as
ordinary income to the extent of any gain. This Policy will become a "modified
endowment contract" if the premiums paid into the Policy fail to meet a 7-pay
premium test as outlined in Section 7702A of the Code.

Certain benefits the Policy Owner may elect under this Policy may be
material changes affecting the 7-pay premium test. These include, but are not
limited to, changes in Death Benefits and changes in the Specified Amount.
Should the Policy become a "modified endowment contract" partial withdrawals,
full Surrenders, assignments, pledges, and loans (including loans to pay loan
interest) under the Policy will be taxable to the extent of any gain under the
Policy. A 10% penalty tax also applies to the taxable portion of any
distribution made prior to the taxpayer's age 59 1/2. The 10% penalty tax does
not apply if the distribution is made because the taxpayer becomes disabled as
defined under the Code or if the distribution is paid out in the form of a life
annuity on the life of the taxpayer or the joint lives of the taxpayer and
Beneficiary. One may avoid a Policy becoming a modified endowment contract by,
among other things, not making excessive payments or reducing benefits. Should
one deposit excessive premiums during a Policy Year, that portion that is
returned by the insurance company within 60 days after the policy anniversary
date will reduce the premiums paid to avoid the policy becoming a modified
endowment contract. All modified endowment policies issued by ANLIC to the same
Policy Owner in any 12 month period are treated as one modified endowment
contract for purposes of determining taxable gain under Section 72(e) of the
Internal Revenue Code. Any life insurance policy received in exchange for a
modified endowment contract will also be treated as a modified endowment
contract. You should contact a competent tax professional before paying
additional premiums or making other changes to the Policy to determine whether
such payments or changes would cause the Policy to become a modified endowment
contract.

The Code (Section 817(h)) also authorizes the Secretary of the Treasury
(the "Treasury") to set standards by regulation or otherwise for the investments
of Separate Account I to be "adequately diversified" in order for the Policy to
be treated as a life insurance contract for federal tax purposes. If the Policy
is not treated as life insurance because it fails the diversification
requirements, the Policy Owner is then subject to federal income tax on gain in
the Policy as it is earned. Separate Account I, through the Funds, intends to
comply with the diversification requirements prescribed by the Treasury in
regulations published in the Federal Register on March 2, 1989, which affect how
the Fund's assets may be invested.

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While Calvert, an ANLIC affiliate, is the adviser to certain of the
portfolios, ANLIC does not have control over any of the Funds or their
investments. However, ANLIC believes that the Funds will be operated in
compliance with the diversification requirements of the Internal Revenue Code.
Thus, ANLIC believes that the Policy will be treated as a life insurance
contract for federal tax purposes.

In connection with the issuance of regulations relating to the
diversification requirements, the Treasury announced that such regulations do
not provide guidance concerning the extent to which policy owners may direct
their investments to particular divisions of a separate account. Regulations in
this regard may be issued in the future. It is not clear what these regulations
will provide nor whether they will be prospective only. It is possible that when
regulations are issued, the Policy may need to be modified to comply with such
regulations. For these reasons, ANLIC reserves the right to modify the Policy as
necessary to prevent the Policy Owner from being considered the owner of the
assets of Separate Account I or otherwise to qualify the Policy for favorable
tax treatment.

The following discussion assumes that the Policy will qualify as a life
insurance contract for federal tax purposes.

(3) TAX TREATMENT OF POLICY PROCEEDS. ANLIC believes that the Policy will be
treated in a manner consistent with a fixed benefit life insurance policy for
federal income tax purposes. Thus, ANLIC believes that the Death Benefit payable
prior to the original Maturity Date will generally be excludable from the gross
income of the Beneficiary under Section 101(a)(1) of the Code and the Policy
Owner will not be deemed to be in constructive receipt of the Accumulation Value
under the Policy until its actual Surrender. However there are certain
exceptions to the general rule that death benefit proceeds are non-taxable.
Federal, state and local tax consequences of ownership or receipt of proceeds
under a Policy depends on the circumstances of each Policy Owner and
Beneficiary.

Distributions From Policies That Are Not "Modified Endowment
Contracts." Distributions (while the Insured is still alive) from a Policy that
is not a modified endowment contract are generally treated as first a recovery
of the investment in the Policy and then only after the return of all such
investment, as disbursing taxable income. However, in the case of a decrease in
the Death Benefit, a partial withdrawal, a change in Death Benefit option, or
any other such change that reduces future benefits under the Policy during the
first 15 years after a Policy is issued an that results in a cash distribution
to the Policy Owner in order for the Policy to continue complying with the
Section 7702 defined limits on premiums and Accumulation Values, such
distributions may be taxable in whole or in part as ordinary income to the
Policy Owner (to the extent of any gain in the Policy) as prescribed in Section
7702. In addition, upon a complete Surrender or lapse of a Policy that is not a
"modified endowment contract," if the amount received plus the amount of any
outstanding Policy debt exceeds the total investment in the Policy, the excess
will generally be treated as ordinary income for tax purposes. Investment in the
Policy means (1) the total amount of any premiums paid for the Policy plus the
amount of any loan received under the Policy to the extent the loan is included
in gross income of the Policy Owner minus (2) the total amount received under
the Policy by the Policy Owner that was excludable from gross income, excluding
any non-taxable loan received under the Policy.

ANLIC also believes that loans received under a Policy will be treated as
debt of the Policy Owner and that no part of any loan under a Policy will
constitute income to the Policy Owner so long as the Policy remains in force.
Should the Policy lapse while Policy loans are outstanding the portion of the
loans attributable to earnings will become taxable. Generally, interest paid on
any loan under a Policy owned by an individual will not be tax-deductible.

Except for policies with respect to a limited number of key persons of an
employer (both as defined in the Internal Revenue Code), and subject to
applicable interest rate caps and debt limits, the Health Insurance Portability
and Accountability Act of 1996 (the "Health Insurance Act") generally repeals
the deduction for interest paid or accrued after October 13, 1995 on loans from
corporate owned life insurance policies on the lives of officers, employees or
persons financially interested in the taxpayer's trade or business. Certain
transitional rules for then existing debt are included in the Health Insurance
Act. The transitional rules include a phase-out of the deduction for debt
incurred (1) before January 1, 1996, or (2) before January 1, 1997, for policies
entered into in 1994 or 1995. The phase-out of the interest expense deduction
occurs over a transition period between October 13, 1995 and January 1, 1999.
There is

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also a special rule for pre-June 21, 1986 policies. The Taxpayer Relief Act of
1997 ("TRA '97"), further expanded the interest deduction disallowance for
businesses by providing, with respect to policies issued after June 8, 1997,
that no deduction is allowed for interest paid or accrued on any debt with
respect to life insurance covering the life of any individual (except as noted
above under pre-'97 law with respect to key persons and pre-June 21, 1986
policies). Any material change in a policy (including a material increase in the
death benefit) may cause the policy to be treated as a new policy for purposes
of this rule. TRA '97 also provides that no deduction is permissible for
premiums paid on a life insurance policy if the taxpayer is directly or
indirectly a beneficiary under the policy. Also under TRA '97 and subject to
certain exceptions, for policies issued after June 8, 1997, no deduction is
allowed for that portion of a taxpayer's interest expense that is allocable to
unborrowed policy cash values. This disallowance generally does not apply to
policies owned by natural persons. Policy Owners should consult a competent tax
advisor concerning the tax implications of these changes for their Policies.

Distributions From Policies That Are "Modified Endowment Contracts." Should
the Policy become a "modified endowment contract" partial withdrawals, full
Surrenders, assignments, pledges, and loans (including loans to pay loan
interest) under the Policy will be taxable to the extent of any gain under the
Policy. A 10% penalty tax also applies to the taxable portion of any
distribution made prior to the taxpayer is disabled as defined under the Code or
if the distribution is paid out in the form of a life annuity on the life of the
taxpayer or the joint lives of the taxpayer and Beneficiary.

The right to change Policy Owners (See the section on General Provisions.),
and the provision for partial withdrawals (See the section on Partial
Surrender.) may have tax consequences depending on the circumstances of such
exchange, change, or withdrawal. Upon complete Surrender or when Maturity
Benefits are paid, if the amount received plus any Outstanding Policy Debt
exceeds the total premiums paid (the "basis") that are not treated as previously
withdrawn by the Policy Owner, the excess generally will be taxed as ordinary
income.

Federal estate and state and local estate, inheritance, and other tax
consequences of ownership or receipt of Death Benefit Proceeds depend on
applicable law and the circumstances of each Policy Owner or Beneficiary. In
addition, if the Policy is used in connection with tax-qualified retirement
plans, certain limitations prescribed by the Internal Revenue Service on, and
rules with respect to the taxation of, life insurance protection provided
through such plans may apply. Further, the tax consequences of using the Policy
in nonqualified plan arrangements may vary depending on the particular facts and
circumstances of the arrangement. The advice of competent counsel should be
sought in connection with use of life insurance in a qualified or nonqualified
plan.

YOU SHOULD CONSULT QUALIFIED TAX AND/OR LEGAL ADVISORS TO OBTAIN COMPLETE
INFORMATION OF FEDERAL, STATE AND LOCAL TAX CONSIDERATIONS APPLICABLE TO YOUR
PARTICULAR SITUATION.

POLICIES ISSUED IN CONJUNCTION WITH EMPLOYEE BENEFIT PLANS

Policies may be acquired in conjunction with employee benefit plans ("EBS
Policies"), including the funding of qualified pension plans meeting the
requirements of Section 401 of the Code.

For EBS Policies, the maximum mortality rates used to determine the monthly
Cost of Insurance Charge are based on the Commissioner's 1980 Standard Ordinary
Mortality Tables. Under these Tables, mortality rates are the same for male and
female Insureds of a particular Attained Age and rate class. (See the section on
Cost of Insurance.)

Illustrations reflecting the premiums and charges for EBS Policies will be
provided upon request to purchasers of such Policies.

There is no provision for misstatement of sex in the EBS Policies. (See the
section on Misstatement of Age or Sex.) Also, the rates used to determine the
amount payable under a particular Settlement Option will be the same for male
and female Insureds. (See the section on Settlement Options.)

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LEGAL DEVELOPMENTS REGARDING UNISEX ACTUARIAL TABLES

In 1983, the United States Supreme Court held in Arizona Governing
Committee v. Norris that optional annuity benefits provided under an employee's
deferred compensation plan could not, under Title VII of the Civil Rights Act of
1964, vary between men and women on the basis of sex. In that case, the Court
applied its decision only to benefits derived from contributions made on or
after August 1, 1983. Subsequent decisions of lower federal courts indicate that
in other factual circumstances the Title VII prohibition of sex-distinct
benefits may apply at an earlier date. In addition, legislative, regulatory, or
decisional authority of some states may prohibit use of sex-distinct mortality
tables under certain circumstances. The Policies offered by this Prospectus
(other than Policies issued in states which require "unisex" policies (currently
Montana) and EBS Policies. (See the section on Policies Issued in Conjunction
with Employee Benefit Plans.) are based upon actuarial tables which distinguish
between men and women and, thus, the Policy provides different benefits to men
and women of the same age. Accordingly, employers and employee organizations
should consider, in consultation with legal counsel, the impact of these
authorities on any employment-related insurance or benefits program before
purchasing the Policy and in determining whether an EBS Policy is appropriate.

VOTING RIGHTS

All of the assets held in the Sub-accounts of the Variable Account will be
invested in shares of corresponding Portfolios of the Funds. The Funds do not
hold routine annual shareholders' meetings. Shareholders' meetings will be
called whenever each Fund believes that it is necessary to vote to elect the
Board of Directors of the Fund and to vote upon certain other matters that are
required by the 1940 Act to be approved or ratified by the shareholders of a
mutual fund. ANLIC is the legal owner of Fund shares and as such has the right
to vote upon any matter that may be voted upon at a shareholders' meeting.
However, in accordance with its view of present applicable law, ANLIC will vote
the shares of the Funds at meetings of the shareholders of the appropriate Fund
or Owner in accordance with instructions received from Owners. Fund shares held
in each Sub-account for which no timely instructions from Owners are received
will be voted by ANLIC in the same proportion as those shares in that Subaccount
for which instructions are received.

Each Owner having a voting interest will be sent proxy material and a form
for giving voting instructions. Owners may vote, by proxy or in person, only as
to the Portfolios that correspond to the Sub-accounts in which their Policy
values are allocated. The number of shares held in each Sub-account attributable
to a Policy for which the Owner may provide voting instructions will be
determined by dividing the Policy's value in that account by the net asset value
of one share of the corresponding Owner as of the record date for the
shareholder meeting. Fractional shares will be counted. For each share of an
Owner for which Owners have no interest, ANLIC will cast votes, for or against
any matter, in the same proportion as Owners vote.

If required by state insurance officials, ANLIC may disregard voting
instructions if such instructions would require shares to be voted so as to
cause a change in the investment objectives or policies of one or more of the
Owners, or to approve or disapprove an investment Policy or investment advice of
one or more of the Owners. In addition, ANLIC may disregard voting instructions
in favor of changes initiated by an Owner or a Fund's Board of Directors
provided that ANLIC's disapproval of the change is reasonable and is based on a
good faith determination that the change would be contrary to state law or
otherwise inappropriate, considering the Portfolio's objectives and purposes,
and the effect the change would have on ANLIC. If ANLIC does disregard voting
instructions, it will advise Owners of that action and its reasons for such
action in the next semi-annual report to Owners.

Shares of the Portfolios may be offered to variable life insurance and
variable annuity separate accounts of life insurance companies other than ANLIC
that are not affiliated with ANLIC. ANLIC understands that shares of these
Portfolios also will be voted by such other life insurance companies in
accordance with instructions from their Owners invested in such separate
accounts. This will dilute the effect of voting instructions of Owners of the
Policies.

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EXECUTIVE OFFICERS AND DIRECTORS OF ANLIC

This list shows name and position(s) with ANLIC followed by the principal
occupations for the last five years. Where an individual has held more than one
position with an organization during the last 5-year period, the last position
held has been given.

CHARLES T. NASON, CHAIRMAN OF THE BOARD AND CHIEF EXECUTIVE OFFICER*
Vice Chairman of Board and President, Director: Ameritas Acacia Mutual Holding
Company
Vice Chairman of Board and President, Director: Ameritas Holding Company
Chairman of the Board and Chief Executive Officer: Acacia Life Insurance Company
Also serves as a Director of direct and indirect subsidiaries of Acacia Life
Insurance Company.

ROBERT W. CLYDE, PRESIDENT AND CHIEF OPERATING OFFICER*
Executive Vice President, Director: Ameritas Acacia Mutual Holding Company
Executive Vice President, Director: Ameritas Holding Company
President and Chief Operating Officer: Acacia Life Insurance Company
Also serves as a Director of direct and indirect subsidiaries of Acacia Life
Insurance Company.

HALUK ARITURK, SENIOR VICE PRESIDENT, PRODUCT MANAGEMENT AND ADMINISTRATION**
Senior Vice President, Product Management and Administration: Acacia Life
Insurance Company
Executive Vice President, Ameritas Acacia Shared Services Center: Ameritas Life
Insurance Corp.
Formerly: Senior Vice President, Operations and Chief Actuary: Acacia Life
Insurance Company.

JOANN M. MARTIN, SENIOR VICE PRESIDENT AND CHIEF FINANCIAL OFFICER, DIRECTOR**
Senior Vice President, Chief Financial Officer and Corporate Treasurer: Ameritas
Acacia Mutual Holding Company and Ameritas Holding Company
Senior Vice President and Chief Financial Officer: Acacia Life Insurance Company

Senior Vice President and Chief Financial Officer: Ameritas Life Insurance Corp.

Also serves as officer and/or director of subsidiaries and/or affiliates of
Ameritas Life Insurance Corp.

BRIAN J. OWENS, SENIOR VICE PRESIDENT, CAREER DISTRIBUTION*
Senior Vice President, Career Distribution: Acacia Life Insurance Company;
Director: The Advisors Group, Inc.

BARRY C. RITTER, SENIOR VICE PRESIDENT AND CHIEF INFORMATION OFFICER**
Senior Vice President and Chief Information Officer, Acacia Life Insurance
Company
Senior Vice President -- Information Services: Ameritas Life Insurance Corp.

ROBERT-JOHN H. SANDS, SENIOR VICE PRESIDENT, GENERAL COUNSEL AND CORPORATE
SECRETARY*
Senior Vice President and General Counsel: Ameritas Acacia Mutual Holding
Company
Senior Vice President and General Counsel: Ameritas Holding Company
Senior Vice President, General Counsel and Corporate Secretary: Acacia Life
Insurance Company
Also serves as a Director of direct and indirect subsidiaries of Acacia Life
Insurance Company.

JANET L. SCHMIDT, SENIOR VICE PRESIDENT, HUMAN RESOURCES*
Senior Vice President and Director of Human Resources: Ameritas Acacia Mutual
Holding Company
Senior Vice President and Director of Human Resources: Ameritas Holding Company
Senior Vice President, Human Resources: Acacia Life Insurance Company

RICHARD W. VAUTRAVERS, SENIOR VICE PRESIDENT AND CORPORATE ACTUARY**
Senior Vice President and Corporate Actuary: Ameritas Life Insurance Corp.
Senior Vice President and Corporate Actuary: Acacia Life Insurance Company

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WILLIAM W. LESTER, VICE PRESIDENT AND TREASURER**
Treasurer: Ameritas Life Insurance Corp.
Also serves as officer of subsidiaries of Ameritas Life Insurance Corp.
Vice President and Treasurer, Acacia Life Insurance Company

RENO J. MARTINI, DIRECTOR***
Senior Vice President, Calvert Group, Ltd.
- ---------------
* The principal business address of each person is Acacia National Life
Insurance Company, 7315 Wisconsin Avenue, Bethesda, Maryland 20814.

** The principal business address of each person is Ameritas Life Insurance
Corp., 5900 "O" Street, Lincoln, Nebraska 68510.

*** The principal business address of each person is Calvert Group, Ltd., 4550
Montgomery Avenue, Bethesda, Maryland 20814.

DISTRIBUTION OF THE POLICIES

Applications for the Policies are solicited by agents who are licensed by
state insurance authorities to sell ANLIC's variable life insurance policies,
and who are also registered representatives of The Advisors Group, Inc. ("TAG")
or registered representatives of broker/dealers who have Selling Agreements with
TAG or registered representatives of broker/dealers who have Selling Agreements
with such broker/dealers. TAG, whose address is 7315 Wisconsin Avenue, Bethesda,
Maryland 20814, is a registered broker/dealer under the Securities Exchange Act
of 1934 ("1934 Act") and a member of the National Association of Securities
Dealers, Inc. ("NASD"). TAG is a second tier wholly-owned subsidiary of Acacia
Life Insurance Company of Washington, D.C. TAG acts as the principal
underwriter, as defined in the 1940 Act, of the Policies (as well as other
variable life policies) pursuant to an Underwriting Agreement with ANLIC. In
1999, TAG received gross variable universal life compensation of $3,480,522 and
retained $7,200 in underwriting fees, and $0 in brokerage commissions on ANLIC's
variable universal life policies.

The insurance underwriting and the determination of a proposed Insured's
Rate Class and whether to accept or reject an application for a Policy is done
by ANLIC. ANLIC will refund any premiums paid if a Policy ultimately is not
issued or will refund the applicable amount if the Policy is returned under the
Free Look provision. The Policies are offered and sold only in those states
where their sale is lawful.

Agents are compensated for sales of the Policies on a commission and
service fee basis and with other forms of compensation. Agents may also receive
expense allowances or bonuses. The agent may be required to return the
commissions if a Policy is not continued.

ADMINISTRATION

ANLIC has contracted with Ameritas Life Insurance Corp. ("ALIC"), having
its principal place of business at 5900 "O" Street, Lincoln, Nebraska for it to
provide ANLIC with certain administrative services for the Flexible Premium
Variable Life Policies. Pursuant to the terms of a Service Agreement, ALIC will
act as Recordkeeping Service Agent for the policies and riders for an initial
term of three years and any subsequent renewals thereof. ALIC, under the
guidance and direction of ANLIC, will perform administration functions
including: issuance of policies for reinstatement, term conversion, plan changes
and guaranteed insurability options, generation of billing and posting of
premium, computation of valuations, calculation of benefits payable, maintenance
of administrative controls over all activities, correspondence, and data, and
providing management reports to ANLIC.

YEAR 2000

Like other insurance companies and their separate accounts, ANLIC and
Separate Account I could be adversely affected if the computer systems they rely
upon do not properly process date-related information and data involving the
years 2000 and after. This issue arose because both mainframe and PC-based
computer hardware and software have traditionally used two digits to identify
the year. For example, the year 1999 is input, stored and calculated as "99."
Similarly, the year 2000 would be input,

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stored and calculated as "00." If computers assume this means 1900, it could
cause errors in calculations, comparisons, and other computing functions.

Like all insurance companies, ANLIC makes extensive use of dates and date
calculations. We began a corporate-wide Year 2000 (Y2K) project in mid-1997. Our
goal is to ensure that our computer systems continue to operate smoothly with no
service disruptions before, during or after the year 2000.

As of April 15, 2000, ANLIC has experienced no known Y2K problems. All of
our computer application and operating systems had been updated for the year
2000 by July 31, 1999. Continuous testing and monitoring throughout the
remainder of 1999 helped ANLIC continue to meet our contractual and service
obligations to our customers. In addition to our internal efforts, ANLIC is
working closely with vendors and other business partners to confirm that they
too are addressing Y2K issues on a timely basis. In the event we or our service
providers, vendors, financial institutions or others with which we conduct
business, fail to be Y2K-compliant, there would be a materially adverse effect
on us.

POLICY REPORTS

At least once each Policy year a statement will be sent to the Owner
describing the status of the Policy, including setting forth the Face Amount,
the current Death Benefit, any Policy loans and accrued interest, the current
Policy Account Value, the General Account Value, indebtedness, the value in each
Sub-account, premiums paid since the last report, charges deducted since the
last report, any partial surrenders since the last report, and the current Cash
Surrender Value. At the present time, ANLIC plans to send these Policy
Statements on a quarterly basis. In addition, a statement will be sent to the
Owner showing the status of the Policy following the transfer of amounts from
one Sub-account to another, the taking out of a loan, a repayment of a loan, a
partial surrender and the payment of any premiums (excluding those paid by bank
draft which has not cleared). The Policy Owner should review the information in
these statements carefully. An Owner may request that a similar report be
prepared at other times. ANLIC may charge a reasonable fee for such requested
reports and may limit the scope and frequency of such requested reports.

An Owner will be sent a semi-annual report containing the financial
statements of the Funds as required by the 1940 Act.

STATE REGULATION

ANLIC is subject to regulation and supervision by the Bureau of Insurance,
State Corporation Commission of the Commonwealth of Virginia which periodically
examines its affairs. It is also subject to the insurance laws and regulations
of all jurisdictions where it is authorized to do business. A copy of the Policy
form has been filed with and, where required, approved by insurance officials in
each jurisdiction where the Policies are sold. ANLIC is required to submit
annual statements of its operations, including financial statements, to the
insurance departments of the various jurisdictions in which it does business for
the purposes of determining solvency and compliance with local insurance laws
and regulations.

EXPERTS

The statutory basis financial statements of ANLIC as of December 31, 1999
and for the year then ended, and the financial statements of the subaccounts of
Separate Account I as of December 31, 1999 and for the year then ended, included
in this prospectus have been audited by Deloitte & Touche LLP, independent
auditors, as stated in their reports appearing herein, and are included in
reliance upon the reports of such firm given upon their authority as experts in
accounting and auditing.

The statutory basis financial statements of ANLIC as of December 31, 1998
and for the year then ended, and the financial statements of the subaccounts of
Separate Account I for each of the two years in the period ended December 31,
1998, included in this prospectus have been audited by PricewaterhouseCoopers
LLP, independent accountants, as stated in their reports appearing herein, and
are included in reliance upon the reports of such firm given upon their
authority as experts in accounting and auditing.

ALLOCATOR 2000
40
<PAGE> 44

Actuarial matters included in the prospectus have been examined by Russell
J. Wiltgen, Vice President -- Individual Product Management of Ameritas Life
Insurance Corp., as stated in his opinion filed as an exhibit to the
Registration Statement.

LEGAL MATTERS

Matters of the State of Virginia law pertaining to the Policies, including
ANLIC's right to issue the Policies and its qualification to do so under
applicable laws and regulations issued thereunder, have been passed upon by
Robert-John H. Sands, Senior Vice President and General Counsel of ANLIC.

ADDITIONAL INFORMATION

A registration statement has been filed with the SEC, under the 1933 Act
with respect to the Policy offered hereby. This prospectus does not contain all
the information set forth in the registration statement and the amendments and
exhibits to the registration statement, to all of which reference is made for
further information concerning the Variable Account, ANLIC and the Policy
offered hereby. Statements contained in this prospectus as to the contents of
the Policy and other legal instruments are summaries. For a complete statement
of the terms thereof, reference is made to such instruments as filed.

ALLOCATOR 2000
41
<PAGE> 45

INDEPENDENT AUDITORS' REPORT

Board of Directors
Acacia National Life Insurance Company
Bethesda, Maryland

We have audited the accompanying statement of net assets of each of the
subaccounts of Acacia National Variable Life Insurance Separate Account I
(comprising, respectively, the Social Money Market Portfolio, Social Balanced
Portfolio, Social Small Cap Growth Portfolio, Social Mid Cap Growth Portfolio,
and Social International Equity Portfolio of the Calvert Variable Series, Inc.;
the Growth Portfolio, MidCap Growth Portfolio, and Small Capitalization
Portfolio of the Alger American Fund; the Stock Index Portfolio of the Dreyfus
Stock Index Fund; the Limited Maturity Bond Portfolio, and the Growth Portfolio
of the Neuberger & Berman Advisers Management Trust; the International Stock
Fund II Portfolio, and Discovery Fund II Portfolio of the Strong Variable
Insurance Funds, Inc.; the Worldwide Hard Assets Portfolio of the Van Eck
Worldwide Insurance Trust; and the Capital Appreciation Portfolio, Aggressive
Growth Portfolio, Growth and Income Portfolio, High Income Portfolio, and
Strategic Bond Portfolio of the Oppenheimer Variable Accounts Fund) as of
December 31, 1999, and the related statements of operations and changes in net
assets 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.

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. Our procedures included
confirmation of securities owned at December 31, 1999. 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 our audit provides a reasonable basis for our opinion.

In our opinion, such 1999 financial statements present fairly, in all material
respects, the financial position of each of the subaccounts constituting Acacia
National Variable Life Insurance Separate Account I as of December 31, 1999, and
the results of its operations and changes in net assets for the year then ended,
in conformity with generally accepted accounting principles.

/s/ Deloitte & Touche LLP

Lincoln, Nebraska
April 7, 2000

F-I- 1
<PAGE> 46

[PRICEWATERHOUSECOOPERS LOGO]

REPORT OF INDEPENDENT ACCOUNTANTS

To the Board of Directors of Acacia National Life Insurance Company and Contract
Owners of Acacia National Variable Life Insurance Separate Account I

In our opinion, the accompanying statements of operations and changes in net
assets present fairly, in all material respects, the results of their operations
and changes in their net assets of each of the following sub-accounts comprising
the Acacia National Variable Life Insurance Separate Account I (the Account):
the Social Money Market Portfolio, Social Balanced Portfolio, Social Small Cap
Growth Portfolio, Social Mid Cap Growth Portfolio, and Social International
Equity Portfolio of the Calvert Variable Series, Inc.; the Growth Portfolio,
MidCap Growth Portfolio, and Small Capitalization Portfolio of The Alger
American Fund; the Stock Index Portfolio of the Dreyfus Stock Index Fund; the
Limited Maturity Bond Portfolio, and Growth Portfolio of the Neuberger & Berman
Advisers Management Trust; the Advantage Fund II, Asset Allocation Fund II,
International Stock Fund II Portfolio, and Discovery Fund II Portfolio of the
Strong Variable Insurance Funds, Inc.; the Worldwide Hard Assets Portfolio of
the Van Eck Worldwide Insurance Trust; and the Capital Appreciation Portfolio,
Aggressive Growth Portfolio, Growth and Income Portfolio, High Income Portfolio,
and Strategic Bond Portfolio of the Oppenheimer Variable Accounts Fund for each
of the periods presented in the years ended December 31, 1998 and 1997, in
conformity with accounting principles generally accepted in the United States.
The financial statements are the responsibility of the Account's management; our
responsibility is to express an opinion on these financial statements based on
our audits. We conducted our audits of these financial statements in accordance
with auditing standards generally accepted in the United States which require
that we plan and perform the audit to obtain reasonable assurance about whether
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, assessing the accounting principles used and
significant estimates made by management, and evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis
for the opinion expressed above.

[/s/ PRICEWATERHOUSECOOPERS LLP]

Washington, D.C.
April 30, 1999

F-I- 2
<PAGE> 47

ACACIA NATIONAL VARIABLE LIFE INSURANCE

SEPARATE ACCOUNT I
STATEMENT OF NET ASSETS
DECEMBER 31, 1999

<TABLE>
<CAPTION>
INVESTMENT DUE (TO)/FROM
AT NET ASSET GENERAL
VALUE ACCOUNT TOTAL
------------ ------------- -----------
<S> <C> <C> <C>
ASSETS
CALVERT VARIABLE SERIES, INC.
Social Money Market Portfolio -- 1,593,462.820 shares at
$1.00 per share (cost $1,593,463)....................... $1,593,463 $11,356 $ 1,604,819
Social Balanced Portfolio -- 150,081.351 shares at $2.169
per share (cost $322,380)............................... 325,527 5,122 330,649
Social Small Cap Growth Portfolio -- 10,561.351 shares at
$13.27 per share (cost $119,854)........................ 140,149 36 140,185
Social Mid Cap Growth Portfolio -- 9,034.095 shares at
$30.03 per share (cost $269,942)........................ 271,294 47 271,341
Social International Equity Portfolio -- 29,100.595 shares
at $25.66 per share (cost $641,008)..................... 746,721 3,890 750,611
THE ALGER AMERICAN FUND:
Growth Portfolio -- 82,340.183 shares at $64.38 per share
(cost $4,009,881)....................................... 5,301,060 4,776 5,305,836
MidCap Growth Portfolio -- 55,027.791 shares at $32.23 per
share (cost $1,399,016)................................. 1,773,545 (1,860) 1,771,685
Small Capitalization Portfolio -- 73,412.631 shares at
$55.15 per share (cost $3,008,216)...................... 4,048,707 5,921 4,054,628
DREYFUS STOCK INDEX FUND:
Stock Index Portfolio -- 346,564.572 shares at $38.45 per
share (cost $10,584,530)................................ 13,325,408 24,551 13,349,959
NEUBERGER & BERMAN ADVISERS MANAGEMENT TRUST:
Limited Maturity Bond Portfolio -- 235,622.603 shares at
$13.24 per share (cost $3,133,285)...................... 3,119,644 21,108 3,140,752
Growth Portfolio -- 72,247.130 shares at $37.27 per share
(cost $1,744,031)....................................... 2,692,651 29,495 2,722,146
STRONG VARIABLE INSURANCE FUNDS, INC.:
International Stock Fund II Portfolio -- 310,700.181
shares at $16.37 per share (cost $2,859,587)............ 5,086,161 13,561 5,099,722
Discovery Fund II Portfolio -- 36,560.925 shares at $11.38
per share (cost $408,153)............................... 416,063 2,048 418,111
VAN ECK WORLDWIDE INSURANCE TRUST:
Worldwide Hard Assets Portfolio -- 94,197.681 shares at
$10.96 per share (cost $1,022,812)...................... 1,032,407 1,746 1,034,153
OPPENHEIMER VARIABLE ACCOUNTS FUND:
Capital Appreciation Portfolio -- 86,724.242 shares at
$49.84 per share (cost $3,441,580)...................... 4,322,337 -- 4,322,337
Aggressive Growth Portfolio -- 39,022.477 shares at $82.31
per share (cost $1,768,125)............................. 3,211,939 24,156 3,236,095
Growth and Income Portfolio -- 54,758.167 shares at $24.63
per share (cost $1,152,379)............................. 1,348,694 3,110 1,351,804
High Income Portfolio -- 65,811.897 shares at $10.72 per
share (cost $708,959)................................... 705,503 3,845 709,348
Strategic Bond Portfolio -- 101,576.323 shares at $4.97
per share (cost $525,198)............................... 504,835 (112) 504,723
-----------
NET ASSETS REPRESENTING EQUITY OF POLICYOWNERS.............. $50,118,904
===========
</TABLE>

The accompanying notes are an integral part of these financial statements.

F-I- 3
<PAGE> 48

ACACIA NATIONAL VARIABLE LIFE INSURANCE

SEPARATE ACCOUNT I
STATEMENTS OF OPERATIONS
FOR THE YEARS ENDED DECEMBER 31, 1999, 1998 AND 1997

<TABLE>
<CAPTION>
CALVERT VARIABLE SERIES, INC.
--------------------------------------
SOCIAL
SOCIAL SOCIAL SMALL CAP
MONEY MARKET BALANCED GROWTH
PORTFOLIO PORTFOLIO PORTFOLIO
------------ --------- ---------
<S> <C> <C> <C>
1999
INVESTMENT INCOME:
Dividend distributions received........................... $43,128 $ 7,030 $ 52
Mortality and expense risk charge......................... 7,218 1,511 839
------- ------- -------
NET INVESTMENT INCOME (LOSS)................................ 35,910 5,519 (787)
------- ------- -------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain distributions........................... -- 24,085 --
Net change in unrealized appreciation (depreciation)...... 12,253 1,900 23,977
------- ------- -------
NET GAIN (LOSS) ON INVESTMENTS.............................. 12,253 25,985 23,977
------- ------- -------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS................................................ $48,163 $31,504 $23,190
======= ======= =======
1998
INVESTMENT INCOME:
Dividend and capital gains distributions received......... $21,621 $ 3,409 $ 1,105
Mortality and expense risk charge......................... 4,679 308 588
------- ------- -------
NET INVESTMENT INCOME (LOSS)................................ 16,942 3,101 517
------- ------- -------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain (loss) from redemptions of fund
shares................................................. 99 611 (2,513)
Net change in unrealized appreciation (depreciation)...... 3,000 1,900 (1,616)
------- ------- -------
NET GAIN (LOSS) ON INVESTMENTS.............................. 3,099 2,511 (4,129)
------- ------- -------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS................................................ $20,041 $ 5,612 $(3,612)
======= ======= =======
1997
INVESTMENT INCOME:
Dividend and capital gains distributions received......... $ 7,942 $ 1,565 $ 4,107
Mortality and expense risk charge......................... 4,111 72 355
------- ------- -------
NET INVESTMENT INCOME (LOSS)................................ 3,831 1,493 3,752
------- ------- -------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain (loss) from redemptions of fund
shares................................................. -- 204 (1,773)
Net change in unrealized appreciation (depreciation)...... 440 (515) (2,228)
------- ------- -------
NET GAIN (LOSS) ON INVESTMENTS.............................. 440 (311) (4,001)
------- ------- -------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS................................................ $ 4,271 $ 1,182 $ (249)
======= ======= =======
</TABLE>

- ---------------
(1) Commenced business May, 1997

The accompanying notes are an integral part of these financial statements.

F-I- 4
<PAGE> 49

<TABLE>
<CAPTION>
DREYFUS STOCK
CALVERT VARIABLE SERIES, INC. THE ALGER AMERICAN FUND INDEX FUND
------------------------------ --------------------------------------- -------------
SOCIAL
SOCIAL INTERNATIONAL MIDCAP SMALL
MID CAP GROWTH EQUITY GROWTH GROWTH CAPITALIZATION STOCK INDEX
PORTFOLIO(1) PORTFOLIO(1) PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
-------------- ------------- ---------- --------- -------------- -------------
<S> <C> <C> <C> <C> <C> <C>
$ -- $ 380 $ 4,285 $ -- $ -- $ 111,343
1,517 3,400 28,150 9,224 21,737 75,772
------- -------- ---------- -------- ---------- ----------
(1,517) (3,020) (23,865) (9,224) (21,737) 35,571
------- -------- ---------- -------- ---------- ----------
20,944 52,658 292,559 152,575 303,027 98,876
2,980 113,538 882,734 257,406 903,837 1,835,918
------- -------- ---------- -------- ---------- ----------
23,924 166,196 1,175,293 409,981 1,206,864 1,934,794
------- -------- ---------- -------- ---------- ----------
$22,407 $163,176 $1,151,428 $400,757 $1,185,127 $1,970,365
======= ======== ========== ======== ========== ==========
$13,549 $ 15,115 $ 232,531 $ 40,068 $ 173,190 $ 130,875
594 990 14,481 5,140 12,562 38,276
------- -------- ---------- -------- ---------- ----------
12,955 14,125 218,050 34,928 160,628 92,599
------- -------- ---------- -------- ---------- ----------
2,455 1,263 98,690 13,059 4,107 184,713
(1,025) (5,285) 297,960 98,503 62,991 729,209
------- -------- ---------- -------- ---------- ----------
1,430 (4,022) 396,650 111,562 67,098 913,922
------- -------- ---------- -------- ---------- ----------
$14,385 $ 10,103 $ 614,700 $146,490 $ 227,726 $1,006,521
======= ======== ========== ======== ========== ==========
$ 1,160 $ 1,968 $ 5,840 $ 2,687 $ 27,461 $ 43,942
28 50 5,914 1,692 6,075 11,588
------- -------- ---------- -------- ---------- ----------
1,132 1,918 (74) 995 21,386 32,354
------- -------- ---------- -------- ---------- ----------
100 4 39,995 11,425 9,397 112,714
(603) (2,540) 95,625 15,140 70,132 146,383
------- -------- ---------- -------- ---------- ----------
(503) (2,536) 135,620 26,565 79,529 259,097
------- -------- ---------- -------- ---------- ----------
$ 629 $ (618) $ 135,546 $ 27,560 $ 100,915 $ 291,451
======= ======== ========== ======== ========== ==========
</TABLE>

F-I- 5
<PAGE> 50

ACACIA NATIONAL VARIABLE LIFE INSURANCE

SEPARATE ACCOUNT I
STATEMENTS OF OPERATIONS
FOR THE YEARS ENDED DECEMBER 31, 1999, 1998 AND 1997

<TABLE>
<CAPTION>
NEUBERGER & BERMAN STRONG VARIABLE
ADVISERS MANAGEMENT TRUST INSURANCE FUNDS, INC.
--------------------------- ------------------------
LIMITED ASSET
MATURITY BOND GROWTH ADVANTAGE ALLOCATION
PORTFOLIO PORTFOLIO FUND II(2) FUND II(2)
-------------- --------- ---------- ----------
<S> <C> <C> <C> <C>
1999
INVESTMENT INCOME:
Dividend distributions received................ $132,944 $ -- $ -- $ --
Mortality and expense risk charge.............. 20,050 14,860 -- --
-------- -------- ---- -------
NET INVESTMENT INCOME (LOSS)..................... 112,894 (14,860) -- --
-------- -------- ---- -------
REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS:
Net realized gain on distributions............. -- 88,404 -- --
Net change in unrealized appreciation
(depreciation).............................. (30,899) 857,225 -- --
-------- -------- ---- -------
NET GAIN (LOSS) ON INVESTMENTS................... (30,899) 945,629 -- --
-------- -------- ---- -------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING
FROM OPERATIONS................................ $ 81,995 $930,769 $ -- $ --
======== ======== ==== =======
1998
INVESTMENT INCOME:
Dividend and capital gains distributions
received.................................... $ 58,873 $188,569 $ -- $ --
Mortality and expense risk charge.............. 12,750 9,585 -- --
-------- -------- ---- -------
NET INVESTMENT INCOME (LOSS)..................... 46,123 178,984 -- --
-------- -------- ---- -------
REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS:
Net realized gain (loss) from redemptions of
fund shares................................. 1,107 (18,723) -- --
Net change in unrealized appreciation
(depreciation).............................. (2,543) 22,943 -- --
-------- -------- ---- -------
NET GAIN (LOSS) ON INVESTMENTS................... (1,436) 4,220 -- --
-------- -------- ---- -------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING
FROM OPERATIONS................................ $ 44,687 $183,204 $ -- $ --
======== ======== ==== =======
1997
INVESTMENT INCOME:
Dividend and capital gains distributions
received.................................... $ 20,653 $ 23,873 $359 $ 6,377
Mortality and expense risk charge.............. 4,295 3,395 49 516
-------- -------- ---- -------
NET INVESTMENT INCOME (LOSS)..................... 16,358 20,478 310 5,861
-------- -------- ---- -------
REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS:
Net realized gain (loss) from redemptions of
fund shares................................. 1,905 16,065 (38) 11,629
Net change in unrealized appreciation
(depreciation).............................. 15,273 59,454 52 2,621
-------- -------- ---- -------
NET GAIN (LOSS) ON INVESTMENTS................... 17,178 75,519 14 14,250
-------- -------- ---- -------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING
FROM OPERATIONS................................ $ 33,536 $ 95,997 $324 $20,111
======== ======== ==== =======
</TABLE>

- ---------------
(1) Commenced business May, 1997

(2) Subaccount closed November, 1997.

The accompanying notes are an integral part of these financial statements.

F-I- 6
<PAGE> 51

<TABLE>
<CAPTION>
VAN ECK
STRONG VARIABLE WORLDWIDE
INSURANCE FUNDS, INC. INSURANCE TRUST OPPENHEIMER VARIABLE ACCOUNTS FUND
------------------------- --------------- ------------------------------------------
INTERNATIONAL DISCOVERY WORLDWIDE CAPITAL AGGRESSIVE GROWTH AND
STOCK FUND II FUND II HARD ASSETS APPRECIATION GROWTH INCOME
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO(1) PORTFOLIO(1) PORTFOLIO(1)
------------- --------- --------------- ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
$ 11,187 $ -- $ 9,610 $ 9,060 $ -- $ 3,439
25,477 2,621 6,153 20,639 17,873 7,399
---------- ------- --------- -------- ---------- --------
(14,290) (2,621) 3,457 (11,579) (17,873) (3,960)
---------- ------- --------- -------- ---------- --------
-- 44,830 -- 99,521 -- 5,794
2,395,242 (15,057) 164,247 634,969 1,323,874 197,475
---------- ------- --------- -------- ---------- --------
2,395,242 29,773 164,247 734,490 1,323,874 203,269
---------- ------- --------- -------- ---------- --------
$2,380,952 $27,152 $ 167,704 $722,911 $1,306,001 $199,309
========== ======= ========= ======== ========== ========
$ 61,955 $ 3,760 $ 41,873 $ 82,136 $ 13,351 $ 10,963
16,284 2,398 3,681 12,581 7,499 3,138
---------- ------- --------- -------- ---------- --------
45,671 1,362 38,192 69,555 5,852 7,825
---------- ------- --------- -------- ---------- --------
(206,240) 5,905 (41,446) 24,932 10,354 1,441
59,071 8,186 (148,313) 224,336 118,634 (4,187)
---------- ------- --------- -------- ---------- --------
(147,169) 14,091 (189,759) 249,268 128,988 (2,746)
---------- ------- --------- -------- ---------- --------
$ (101,498) $15,453 $(151,567) $318,823 $ 134,840 $ 5,079
========== ======= ========= ======== ========== ========
$ 8,037 $ -- $ 5,120 $ -- $ -- $ 267
8,011 1,084 1,655 2,354 1,370 272
---------- ------- --------- -------- ---------- --------
26 (1,084) 3,465 (2,354) (1,370) (5)
---------- ------- --------- -------- ---------- --------
(3,230) 5,524 2,494 2,729 4,036 1,288
(230,017) 12,920 (10,841) 21,451 1,306 3,027
---------- ------- --------- -------- ---------- --------
(233,247) 18,444 (8,347) 24,180 5,342 4,315
---------- ------- --------- -------- ---------- --------
$ (233,221) $17,360 $ (4,882) $ 21,826 $ 3,972 $ 4,310
========== ======= ========= ======== ========== ========
</TABLE>

F-I- 7
<PAGE> 52

ACACIA NATIONAL VARIABLE LIFE INSURANCE

SEPARATE ACCOUNT I
STATEMENTS OF OPERATIONS
FOR THE YEARS ENDED DECEMBER 31, 1999, 1998 AND 1997

<TABLE>
<CAPTION>
OPPENHEIMER VARIABLE
ACCOUNTS FUND
----------------------------
STRATEGIC
HIGH INCOME BOND
PORTFOLIO(1) PORTFOLIO(1)
1999 ------------ ------------
<S> <C> <C>
INVESTMENT INCOME:
Dividend distributions received........................... $ 30,951 $ 37,569
Mortality and expense risk charge......................... 4,163 3,598
-------- --------
NET INVESTMENT INCOME (LOSS)................................ 26,788 33,971
-------- --------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain distributions........................... -- --
Net change in unrealized appreciation (depreciation)...... 6,886 (19,428)
-------- --------
NET GAIN (LOSS) ON INVESTMENTS.............................. 6,886 (19,428)
-------- --------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS................................................ $ 33,674 $ 14,543
======== ========
1998
INVESTMENT INCOME:
Dividend and capital gains distributions received......... $ 6,494 $ 14,163
Mortality and expense risk charge......................... 1,942 1,297
-------- --------
NET INVESTMENT INCOME (LOSS)................................ 4,552 12,866
-------- --------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain (loss) from redemptions of fund
shares................................................. (1,436) (5,635)
Net change in unrealized appreciation (depreciation)...... (10,716) (740)
-------- --------
NET GAIN (LOSS) ON INVESTMENTS.............................. (12,152) (6,375)
-------- --------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS................................................ $ (7,600) $ 6,491
======== ========
1997
INVESTMENT INCOME:
Dividend and capital gains distributions received......... $ 2,165 $ 765
Mortality and expense risk charge......................... 248 45
-------- --------
NET INVESTMENT INCOME (LOSS)................................ 1,917 720
-------- --------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain (loss) from redemptions of fund
shares................................................. 270 4
Net change in unrealized appreciation (depreciation)...... 375 (196)
-------- --------
NET GAIN (LOSS) ON INVESTMENTS.............................. 645 (192)
-------- --------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS................................................ $ 2,562 $ 528
======== ========
</TABLE>

- ---------------
(1) Commenced business May, 1997

The accompanying notes are an integral part of these financial statements.

F-I- 8
<PAGE> 53

[This page intentionally left blank.]

F-I- 9
<PAGE> 54

ACACIA NATIONAL VARIABLE LIFE INSURANCE

SEPARATE ACCOUNT I
STATEMENTS OF CHANGES IN NET ASSETS
FOR THE YEARS ENDED DECEMBER 31, 1999, 1998 AND 1997

<TABLE>
<CAPTION>
CALVERT VARIABLE SERIES, INC.
--------------------------------------
SOCIAL
SOCIAL SOCIAL SMALL CAP
MONEY MARKET BALANCED GROWTH
PORTFOLIO PORTFOLIO PORTFOLIO
------------ --------- ---------
<S> <C> <C> <C>
1999
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS:
Net investment income (loss)............................. $ 35,910 $ 5,519 $ (787)
Net realized gain distributions.......................... -- 24,085 --
Net change in unrealized appreciation (depreciation)..... 12,253 1,900 23,977
---------- -------- --------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS............................................... 48,163 31,504 23,190
NET INCREASE (DECREASE) FROM POLICYOWNER TRANSACTIONS...... 860,441 251,997 29,588
---------- -------- --------
TOTAL INCREASE (DECREASE) IN NET ASSETS.................... 908,604 283,501 52,778
---------- -------- --------
NET ASSETS AT JANUARY 1, 1999.............................. $ 696,215 $ 47,148 $ 87,407
---------- -------- --------
NET ASSETS AT DECEMBER 31, 1999............................ $1,604,819 $330,649 $140,185
========== ======== ========
1998
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS:
Net investment income (loss)............................. $ 16,942 $ 3,101 $ 517
Net realized gain (loss) from redemption of fund
shares................................................ 99 611 (2,513)
Net change in unrealized appreciation (depreciation)..... 3,000 1,900 (1,616)
---------- -------- --------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS............................................... 20,041 5,612 (3,612)
NET INCREASE (DECREASE) FROM POLICYOWNER TRANSACTIONS...... 309,331 18,777 44,873
---------- -------- --------
TOTAL INCREASE (DECREASE) IN NET ASSETS.................... 329,372 24,389 41,261
---------- -------- --------
NET ASSETS AT JANUARY 1, 1998.............................. $ 366,843 $ 22,759 $ 46,146
---------- -------- --------
NET ASSETS AT DECEMBER 31, 1998............................ $ 696,215 $ 47,148 $ 87,407
========== ======== ========
1997
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS:
Net investment income (loss)............................. $ 3,831 $ 1,493 $ 3,752
Net realized gain (loss) from redemption of fund
shares................................................ -- 204 (1,773)
Net change in unrealized appreciation (depreciation)..... 440 (515) (2,228)
---------- -------- --------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS............................................... 4,271 1,182 (249)
NET INCREASE (DECREASE) FROM POLICYOWNER TRANSACTIONS...... 216,346 18,745 25,899
---------- -------- --------
TOTAL INCREASE (DECREASE) IN NET ASSETS.................... 220,617 19,927 25,650
---------- -------- --------
NET ASSETS AT JANUARY 1, 1997.............................. $ 146,226 $ 2,832 $ 20,496
---------- -------- --------
NET ASSETS AT DECEMBER 31, 1997............................ $ 366,843 $ 22,759 $ 46,146
========== ======== ========
</TABLE>

- ---------------
(1) Commenced business May, 1997

The accompanying notes are an integral part of these financial statements.

F-I- 10
<PAGE> 55

<TABLE>
<CAPTION>
DREYFUS STOCK
CALVERT VARIABLE SERIES, INC. THE ALGER AMERICAN FUND INDEX FUND
------------------------------ ---------------------------------------- -------------
SOCIAL
SOCIAL INTERNATIONAL MID CAP SMALL
MID CAP GROWTH EQUITY GROWTH GROWTH CAPITALIZATION STOCK INDEX
PORTFOLIO(1) PORTFOLIO(1) PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
-------------- ------------- ---------- ---------- -------------- -------------
<S> <C> <C> <C> <C> <C> <C>
$ (1,517) $ (3,020) $ (23,865) $ (9,224) $ (21,737) $ 35,571
20,944 52,658 292,559 152,575 303,027 98,876
2,980 113,538 882,734 257,406 903,837 1,835,918
-------- -------- ---------- ---------- ---------- -------------
22,407 163,176 1,151,428 400,757 1,185,127 1,970,365
125,068 383,269 1,752,646 519,905 823,820 4,711,735
-------- -------- ---------- ---------- ---------- -------------
147,475 545,445 2,904,074 920,662 2,008,947 6,682,100
-------- -------- ---------- ---------- ---------- -------------
$123,866 $205,166 $2,401,762 $ 851,023 $2,045,681 $ 6,667,859
-------- -------- ---------- ---------- ---------- -------------
$271,341 $750,611 $5,305,836 $1,771,685 $4,054,628 $ 13,349,959
======== ======== ========== ========== ========== =============
$ 12,955 $ 14,125 $ 218,050 $ 34,928 $ 160,628 $ 92,599
2,455 1,263 98,690 13,059 4,107 184,713
(1,025) (5,285) 297,960 98,503 62,991 729,209
-------- -------- ---------- ---------- ---------- -------------
14,385 10,103 614,700 146,490 227,726 1,006,521
98,279 175,356 898,671 387,686 1,009,524 3,632,941
-------- -------- ---------- ---------- ---------- -------------
112,664 185,459 1,513,371 534,176 1,237,250 4,639,462
-------- -------- ---------- ---------- ---------- -------------
$ 11,202 $ 19,707 $ 888,391 $ 316,847 $ 808,431 $ 2,028,397
-------- -------- ---------- ---------- ---------- -------------
$123,866 $205,166 $2,401,762 $ 851,023 $2,045,681 $ 6,667,859
======== ======== ========== ========== ========== =============
$ 1,132 $ 1,918 $ (74) $ 995 $ 21,386 $ 32,354
100 4 39,995 11,425 9,397 112,714
(603) (2,540) 95,625 15,140 70,132 146,383
-------- -------- ---------- ---------- ---------- -------------
629 (618) 135,546 27,560 100,915 291,451
10,573 20,325 431,691 198,748 303,922 1,185,520
-------- -------- ---------- ---------- ---------- -------------
11,202 19,707 567,237 226,308 404,837 1,476,971
-------- -------- ---------- ---------- ---------- -------------
$ -- $ -- $ 321,154 $ 90,539 $ 403,594 $ 551,426
-------- -------- ---------- ---------- ---------- -------------
$ 11,202 $ 19,707 $ 888,391 $ 316,847 $ 808,431 $ 2,028,397
======== ======== ========== ========== ========== =============
</TABLE>

F-I- 11
<PAGE> 56

ACACIA NATIONAL VARIABLE LIFE INSURANCE
SEPARATE ACCOUNT I
STATEMENTS OF CHANGES IN NET ASSETS
FOR THE YEARS ENDED DECEMBER 31, 1999, 1998 AND 1997

<TABLE>
<CAPTION>
NEUBERGER & BERMAN STRONG VARIABLE
ADVISERS MANAGEMENT TRUST INSURANCE FUNDS, INC.
-------------------------- ------------------------
LIMITED
MATURITY ASSET
BOND GROWTH ADVANTAGE ALLOCATION
PORTFOLIO PORTFOLIO FUND II(2) FUND II(2)
----------- ----------- ---------- ----------
<S> <C> <C> <C> <C>
1999
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS:
Net investment income (loss)....................... $ 112,894 $ (14,860) $ -- $ --
Net realized gain distributions.................... -- 88,404 -- --
Net change in unrealized appreciation
(depreciation)................................... (30,899) 857,225 -- --
---------- ---------- -------- ---------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS......................................... 81,995 930,769 -- --
NET INCREASE (DECREASE) FROM POLICYOWNER
TRANSACTIONS....................................... 1,025,930 243,298 -- --
---------- ---------- -------- ---------
TOTAL INCREASE (DECREASE) IN NET ASSETS.............. 1,107,925 1,174,067 -- --
---------- ---------- -------- ---------
NET ASSETS AT JANUARY 1, 1999........................ $2,032,827 $1,548,079 $ -- $ --
---------- ---------- -------- ---------
NET ASSETS AT DECEMBER 31, 1999...................... $3,140,752 $2,722,146 $ -- $ --
========== ========== ======== =========
1998
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS:
Net investment income (loss)....................... $ 46,123 $ 178,984 $ -- $ --
Net realized gain (loss) from redemption of fund
shares........................................... 1,107 (18,723) -- --
Net change in unrealized appreciation
(depreciation)................................... (2,543) 22,943 -- --
---------- ---------- -------- ---------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS......................................... 44,687 183,204 -- --
NET INCREASE (DECREASE) FROM POLICYOWNER
TRANSACTIONS....................................... 1,124,307 735,204 -- --
---------- ---------- -------- ---------
TOTAL INCREASE (DECREASE) IN NET ASSETS.............. 1,168,994 918,408 -- --
---------- ---------- -------- ---------
NET ASSETS AT JANUARY 1, 1998........................ $ 863,833 $ 629,671 $ -- $ --
---------- ---------- -------- ---------
NET ASSETS AT DECEMBER 31, 1998...................... $2,032,827 $1,548,079 $ -- $ --
========== ========== ======== =========
1997
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS:
Net investment income (loss)....................... $ 16,358 $ 20,478 $ 310 $ 5,861
Net realized gain (loss) from redemption of fund
shares........................................... 1,905 16,065 (38) 11,629
Net change in unrealized appreciation
(depreciation)................................... 15,273 59,454 52 2,621
---------- ---------- -------- ---------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS......................................... 33,536 95,997 324 20,111
NET INCREASE (DECREASE) FROM POLICYOWNER
TRANSACTIONS....................................... 624,805 352,564 (10,234) (107,191)
---------- ---------- -------- ---------
TOTAL INCREASE (DECREASE) IN NET ASSETS.............. 658,341 448,561 (9,910) (87,080)
---------- ---------- -------- ---------
NET ASSETS AT JANUARY 1, 1997........................ $ 205,492 $ 181,110 $ 9,910 $ 87,080
---------- ---------- -------- ---------
NET ASSETS AT DECEMBER 31, 1997...................... $ 863,833 $ 629,671 $ 0 $ 0
========== ========== ======== =========
</TABLE>

- ---------------

(1) Commenced business May, 1997

(2) Subaccount closed November, 1997

F-I- 12
<PAGE> 57

<TABLE>
<CAPTION>
STRONG VARIABLE VAN ECK WORLDWIDE
INSURANCE FUNDS, INC. INSURANCE TRUST OPPENHEIMER VARIABLE ACCOUNTS FUND
------------------------- ----------------- ------------------------------------------
INTERNATIONAL DISCOVERY WORLDWIDE CAPITAL AGGRESSIVE GROWTH &
STOCK FUND II FUND II HARD ASSETS APPRECIATION GROWTH INCOME
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO(1) PORTFOLIO(1) PORTFOLIO(1)
------------- --------- ----------------- ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
$ (14,290) $ (2,621) $ 3,457 $ (11,579) $ (17,873) $ (3,960)
-- 44,830 -- 99,521 -- 5,794
2,395,242 (15,057) 164,247 634,969 1,323,874 197,475
---------- -------- ---------- ---------- ---------- ----------
2,380,952 27,152 167,704 722,911 1,306,001 199,309
305,865 54,601 284,172 1,345,599 582,546 514,599
---------- -------- ---------- ---------- ---------- ----------
2,686,817 81,753 451,876 2,068,510 1,888,547 713,908
---------- -------- ---------- ---------- ---------- ----------
$2,412,905 $336,358 $ 582,277 $2,253,827 $1,347,548 $ 637,896
---------- -------- ---------- ---------- ---------- ----------
$5,099,722 $418,111 $1,034,153 $4,322,337 $3,236,095 $1,351,804
========== ======== ========== ========== ========== ==========
$ 45,671 $ 1,362 $ 38,192 $ 69,555 $ 5,852 $ 7,825
(206,240) 5,905 (41,446) 24,932 10,354 1,441
59,071 8,186 (148,313) 224,336 118,634 (4,187)
---------- -------- ---------- ---------- ---------- ----------
(101,498) 15,453 (151,567) 318,823 134,840 5,079
1,227,685 112,491 479,900 1,330,394 856,576 557,879
---------- -------- ---------- ---------- ---------- ----------
1,126,187 127,944 328,333 1,649,217 991,416 562,958
---------- -------- ---------- ---------- ---------- ----------
$1,286,718 $208,414 $ 253,944 $ 604,610 $ 356,132 $ 74,938
---------- -------- ---------- ---------- ---------- ----------
$2,412,905 $336,358 $ 582,277 $2,253,827 $1,347,548 $ 637,896
========== ======== ========== ========== ========== ==========
$ 26 $ (1,084) $ 3,465 $ (2,354) $ (1,370) $ (5)
(3,230) 5,524 2,494 2,729 4,036 1,288
(230,017) 12,920 (10,841) 21,451 1,306 3,027
---------- -------- ---------- ---------- ---------- ----------
(233,221) 17,360 (4,882) 21,826 3,972 4,310
1,076,576 114,093 170,829 582,784 352,160 70,628
---------- -------- ---------- ---------- ---------- ----------
843,355 131,453 165,947 604,610 356,132 74,938
---------- -------- ---------- ---------- ---------- ----------
$ 443,363 $ 76,961 $ 87,997 $ -- $ -- $ --
---------- -------- ---------- ---------- ---------- ----------
$1,286,718 $208,414 $ 253,944 $ 604,610 $ 356,132 $ 74,938
========== ======== ========== ========== ========== ==========
</TABLE>

F-I- 13
<PAGE> 58

ACACIA NATIONAL VARIABLE LIFE INSURANCE
SEPARATE ACCOUNT I
STATEMENTS OF CHANGES IN NET ASSETS
FOR THE YEARS ENDED DECEMBER 31, 1999, 1998 AND 1997

<TABLE>
<CAPTION>
OPPENHEIMER VARIABLE
ACCOUNTS FUND
------------------------------
HIGH INCOME STRATEGIC BOND
PORTFOLIO(1) PORTFOLIO(1)
1999 ------------ --------------
<S> <C> <C>
INCREASE(DECREASE) IN NET ASSETS FROM OPERATIONS:
Net investment income(loss)............................... $ 26,788 $ 33,971
Net realized gain distributions........................... -- --
Net change in unrealized appreciation(depreciation)....... 6,886 (19,428)
-------- --------
NET INCREASE(DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS................................................ 33,674 14,543
NET INCREASE(DECREASE) FROM POLICYOWNER TRANSACTIONS........ 304,273 214,887
-------- --------
TOTAL INCREASE(DECREASE) IN NET ASSETS...................... 337,947 229,430
-------- --------
NET ASSETS AT JANUARY 1, 1999............................... 371,401 275,293
-------- --------
NET ASSETS AT DECEMBER 31, 1999............................. $709,348 $504,723
======== ========
1998
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS:
Net investment income(loss)............................... $ 4,552 $ 12,866
Net realized gain(loss) from redemption of fund shares.... (1,436) (5,635)
Net change in unrealized appreciation(depreciation)....... (10,716) (740)
-------- --------
NET INCREASE(DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS................................................ (7,600) 6,491
NET INCREASE(DECREASE) FROM POLICYOWNER TRANSACTIONS........ 309,237 249,444
-------- --------
TOTAL INCREASE(DECREASE) IN NET ASSETS...................... 301,637 255,935
-------- --------
NET ASSETS AT JANUARY 1, 1998............................... 69,764 19,358
-------- --------
NET ASSETS AT DECEMBER 31, 1998............................. $371,401 $275,293
======== ========
1997
INCREASE(DECREASE) IN NET ASSETS FROM OPERATIONS:
Net investment income(loss)............................... $ 1,917 $ 720
Net realized gain(loss) from redemption of fund shares.... 270 4
Net change in unrealized appreciation(depreciation)....... 375 (196)
-------- --------
NET INCREASE(DECREASE) IN NET ASSETS RESULTING FROM
OPERATIONS................................................ 2,562 528
NET INCREASE(DECREASE) FROM POLICYOWNER TRANSACTIONS........ 67,202 18,830
-------- --------
TOTAL INCREASE(DECREASE) IN NET ASSETS...................... 69,764 19,358
-------- --------
NET ASSETS AT JANUARY 1, 1997............................... -- --
-------- --------
NET ASSETS AT DECEMBER 31, 1997............................. $ 69,764 $ 19,358
======== ========
</TABLE>

- ---------------

(1) Commenced business May, 1997

The accompanying notes are an integral part of these financial statements.

F-I- 14
<PAGE> 59

ACACIA NATIONAL VARIABLE LIFE INSURANCE

SEPARATE ACCOUNT I
NOTES TO FINANCIAL STATEMENTS

NOTE 1 -- ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES

The Acacia National Variable Life Insurance Separate Account I (the Account)
began operations on December 1, 1995 as a separate investment account within
Acacia National Life Insurance Company (the Company), a wholly owned subsidiary
of Acacia Life Insurance Company. The assets of the Account are held by the
Company and are segregated from all of the Company's other assets.

The Account is registered under the Investment Company Act of 1940, as amended,
as a unit investment trust. At December 31, 1999 there are nineteen subaccounts
within the Account. Five of the subaccounts invest only in a corresponding
Portfolio of the Calvert Variable Series, Inc. which is a diversified open-end
management investment company managed by the Calvert Asset Management Company,
Inc. (see note 3). Three of the subaccounts invest only in a corresponding
Portfolio of The Alger American Fund which is a diversified open-end management
investment company managed by Fred Alger Management, Inc. (Alger Management).
One subaccount invests only in a corresponding Portfolio of Dreyfus Stock Index
Fund which is a non-diversified open-end management investment company managed
by Dreyfus Service Corporation. Two of the subaccounts invest only in a
corresponding Portfolio of the Neuberger & Berman Advisers Management Trust
which is a diversified open-end management investment company managed by
Neuberger & Berman Management Incorporated. Two of the subaccounts invest only
in a corresponding Portfolio of the Strong Variable Insurance Fund, Inc. which
is a diversified open-end management investment company managed by Strong
Capital Management, Inc. One of the subaccounts invest only in a corresponding
Portfolio of the Van Eck Worldwide Insurance Trust which is a non-diversified
open-end management investment company managed by Van Eck Associates
Corporation. Five of the subaccounts invest only in a corresponding Portfolio of
the Oppenheimer Variable Accounts Fund which is a diversified open-end
management investment company managed by Oppenheimer Funds, Inc. Each Portfolio
pays the manager a monthly fee for managing its investments and business
affairs.

USE OF ESTIMATES

The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates.

CONSISTENCY

Due to changes in the processing environment during 1999, certain information is
presented differently between years. In 1999, net realized gains/losses on
redemption of fund shares is included in net change in unrealized
appreciation/depreciation. Capital gain distributions received are reflected in
net realized gain distributions.

In 1998 and 1997, net realized gains and losses on redemption of fund shares are
separately presented. Capital gain distributions received from funds are
included in dividend distributions received.

VALUATION OF INVESTMENTS

The assets of the account are carried at the net asset value of the underlying
Portfolios. The value of the policyowners' units corresponds to the Account's
investment in the underlying subaccounts. The availability of investment
portfolio and subaccount options may vary between products. Share transactions
and security transactions are accounted for on a trade date basis. However,
dividends of $30,157 for the Stock Index Portfolio and $21,938 for the
International Stock Fund II Portfolio were received in 1997 and recorded in
1998. All affected policyholder accounts were adjusted.

F-I- 15
<PAGE> 60
ACACIA NATIONAL VARIABLE LIFE INSURANCE

SEPARATE ACCOUNT I
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

NOTE 1 -- ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES -- (CONTINUED)
FEDERAL AND STATE TAXES

The operations of the Account are included in the federal income tax return of
the Company, which is taxed as a life insurance company under the Internal
Revenue Code. The Company has the right to charge the Account any federal income
taxes, or provision for federal income taxes, attributable to the operations of
the Account or to the policies funded in the Account. Currently, the Company
does not make a charge for income or other taxes. Charges for state and local
taxes, if any, attributable to the Account may also be made.

2. POLICYOWNER CHARGES

The Company charges the Account for mortality and expense risks assumed. A daily
charge is made on the average daily value of the net assets representing equity
of policyowners held in each subaccount per each product's current policy
provisions. Additional charges are made at intervals and in amounts per each
product's current policy provisions. These charges are prorated against the
balance in each investment option of the policyowner, including the Fixed
Account option which is not reflected in this separate account.

3. RELATED PARTIES

Calvert Asset Management Company, Inc., an affiliate of the Company, serves as
an investment advisor to the Calvert Variable Series, Inc. Social Money Market,
Social Balanced, Social Small Cap Growth, Social Mid Cap Growth and Social
International Equity Portfolios. The Advisors Group, Inc., an affiliate of the
Company, acts as a principal underwriter of the policies pursuant to an
underwriting agreement with the Company.

F-I- 16
<PAGE> 61

[This page intentionally left blank.]

F-I- 17
<PAGE> 62
ACACIA NATIONAL VARIABLE LIFE INSURANCE

SEPARATE ACCOUNT I
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

4. UNITS OWNED

Units owned in the Account are as follows:

CALVERT VARIABLE SERIES, INC.
-------------------------------------------------------------------------
SOCIAL SOCIAL
SOCIAL SOCIAL SMALL CAP SOCIAL INTERNATIONAL
MONEY MARKET BALANCED GROWTH MID CAP GROWTH EQUITY
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
------------ --------- --------- -------------- -------------
<S> <C> <C> <C> <C> <C>
Units owned at January 1, 1999..... 598,035 2,990 7,476 7,670 15,712
Units acquired..................... 5,307,754 17,585 7,132 26,315 33,694
Units disposed..................... 4,539,913 2,073 4,511 18,191 6,276
--------- ------ ------ ------ ------
Units owned at December 31, 1999... 1,365,876 18,502 10,097 15,794 43,130
========= ====== ====== ====== ======

Units owned at January 1, 1998..... 330,489 1,678 3,703 900 1,788
Units acquired..................... 2,498,903 2,971 5,008 7,984 17,004
Units disposed..................... 2,231,357 1,659 1,235 1,214 3,080
--------- ------ ------ ------ ------
Units owned at December 31, 1998... 598,035 2,990 7,476 7,670 15,712
========= ====== ====== ====== ======

Units owned at January 1, 1997..... 138,906 251 1,482 -- --
Units acquired..................... 1,439,931 1,655 4,603 994 1,939
Units disposed..................... 1,248,348 228 2,382 94 151
--------- ------ ------ ------ ------
Units owned at December 31, 1997... 330,489 1,678 3,703 900 1,788
========= ====== ====== ====== ======
</TABLE>

F-I- 18
<PAGE> 63

<TABLE>
<CAPTION>
DREYFUS NEUBERGER & BERMAN
STOCK ADVISERS STRONG VARIABLE
THE ALGER AMERICAN FUND INDEX FUND MANAGEMENT TRUST INSURANCE FUNDS, INC.
- -------------------------------------- ----------- --------------------- ----------------------------
LIMITED
MIDCAP SMALL MATURITY
GROWTH GROWTH CAPITALIZATION STOCK INDEX BOND GROWTH ADVANTAGE ASSET ALLOCATION
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO FUND II FUND II
- --------- --------- -------------- ----------- --------- --------- --------- ----------------
<S> <C> <C> <C> <C> <C> <C> <C>
113,872 50,595 153,159 320,865 173,713 97,419 -- --
146,269 79,523 151,870 357,435 200,479 48,449 -- --
71,718 49,811 92,843 144,982 111,058 33,014 -- --
------- ------ ------- ------- ------- ------- ----- ------
188,423 80,307 212,186 533,318 263,134 112,854 -- --
======= ====== ======= ======= ======= ======= ===== ======

62,387 24,543 69,933 125,133 77,059 45,761 -- --
78,302 32,437 103,745 230,164 136,118 65,880 -- --
26,817 6,385 20,519 34,432 39,464 14,222 -- --
------- ------ ------- ------- ------- ------- ----- ------
113,872 50,595 153,159 320,865 173,713 97,419 -- --
======= ====== ======= ======= ======= ======= ===== ======

28,351 8,066 38,887 45,236 19,571 16,990 984 7,816
64,768 26,097 83,058 141,619 84,591 46,395 677 11,884
30,732 9,620 52,012 61,722 27,103 17,624 1,661 19,700
------- ------ ------- ------- ------- ------- ----- ------
62,387 24,543 69,933 125,133 77,059 45,761 -- --
======= ====== ======= ======= ======= ======= ===== ======
</TABLE>

F-I- 19
<PAGE> 64

ACACIA NATIONAL VARIABLE LIFE INSURANCE

SEPARATE ACCOUNT I
NOTES TO FINANCIAL STATEMENTS -- (CONTINUED)

4. UNITS OWNED -- (CONTINUED)

Units owned in the Account are as follows:

<TABLE>
<CAPTION>
VAN ECK
STRONG VARIABLE WORLDWIDE
INSURANCE FUNDS, INC. INSURANCE TRUST
-------------------------- ---------------
INTERNATIONAL DISCOVERY WORLDWIDE
STOCK FUND II FUND II HARD ASSETS
PORTFOLIO PORTFOLIO PORTFOLIO
------------- --------- ---------------
<S> <C> <C> <C>
Units owned at January 1, 1999........................... 262,868 28,197 73,721
Units acquired........................................... 258,376 91,292 105,757
Units disposed........................................... 223,453 86,116 71,150
------- ------ -------
Units owned at December 31, 1999......................... 297,791 33,373 108,328
======= ====== =======

Units owned at January 1, 1998........................... 137,912 18,742 22,198
Units acquired........................................... 201,600 14,670 59,926
Units disposed........................................... 76,644 5,215 8,403
------- ------ -------
Units owned at December 31, 1998......................... 262,868 28,197 73,721
======= ====== =======

Units owned at January 1, 1997........................... 39,763 7,708 7,560
Units acquired........................................... 132,459 17,417 22,271
Units disposed........................................... 34,310 6,383 7,633
------- ------ -------
Units owned at December 31, 1997......................... 137,912 18,742 22,198
======= ====== =======
</TABLE>

F-I- 20
<PAGE> 65

<TABLE>
<CAPTION>
OPPENHEIMER VARIABLE ACCOUNTS FUND
----------------------------------------------------------------
CAPITAL AGGRESSIVE GROWTH AND STRATEGIC
APPRECIATION GROWTH INCOME HIGH INCOME BOND
PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO PORTFOLIO
------------ ---------- ---------- ----------- ---------
<S> <C> <C> <C> <C> <C>
150,216 95,687 47,458 33,313.. 24,847
135,346 159,858 93,705 60,039.. 54,441
82,628 131,625 58,251 32,216.. 34,723
------- ------- ------ ------ ------
202,934 123,920 82,912 61,136.. 44,565
======= ======= ====== ====== ======
49,967 28,422 5,836 6,274... 1,797
119,856 77,765 48,498 33,123.. 77,960
19,607 10,500 6,876 6,084... 54,910
------- ------- ------ ------ ------
150,216 95,687 47,458 33,313.. 24,847
======= ======= ====== ====== ======

-- -- -- -- --
59,904 36,728 7,354 7,955... 2,265
9,937 8,306 1,518 1,681... 468
------- ------- ------ ------ ------
49,967 28,422 5,836 6,274... 1,797
======= ======= ====== ====== ======
</TABLE>

F-I- 21
<PAGE> 66

INDEPENDENT AUDITORS' REPORT

Board of Directors
Acacia National Life Insurance Company
Bethesda, Maryland

We have audited the accompanying statement of admitted assets, liabilities, and
surplus -- statutory basis of Acacia National Life Insurance Company (a wholly
owned subsidiary of Acacia Life Insurance Company) as of December 31, 1999, and
the related statements of operations -- statutory basis, changes in
surplus -- statutory basis, and cash flows -- statutory basis 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.

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 more fully in Note 1 to the financial statements, the Company
prepared these financial statements using accounting practices prescribed or
permitted by the Bureau of Insurance, State Corporation Commission of the
Commonwealth of Virginia, which practices differ from generally accepted
accounting principles. The effects on the financial statements of the variances
between the statutory basis of accounting and generally accepted accounting
principles, although not reasonably determinable, are presumed to be material.

In our opinion, because of the effects of the matter discussed in the preceding
paragraph, the 1999 financial statements referred to above do not present
fairly, in conformity with generally accepted accounting principles, the
financial position of Acacia National Life Insurance Company as of December 31,
1999, or the results of its operations or its cash flows for the year then
ended.

In our opinion, the 1999 financial statements referred to above present fairly,
in all material respects, the admitted assets, liabilities, and surplus of
Acacia National Life Insurance Company as of December 31, 1999, and the results
of its operations and its cash flows for the year then ended, on the basis of
accounting described in Note 1.

/s/ DELOITTE & TOUCHE LLP

Lincoln, Nebraska
April 7, 2000

F-II- 1
<PAGE> 67

[PRICEWATERHOUSECOOPERS LOGO]

INDEPENDENT AUDITORS' REPORT

Board of Directors
Acacia National Life Insurance Company

We have audited the accompanying statement of admitted assets, liabilities, and
surplus -- statutory basis of Acacia National Life Insurance Company (the
Company) as of December 31, 1998, and the related statutory statements of
operations and changes in surplus, and cash flow, 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.

We conducted our audit in accordance with auditing standards generally accepted
in the United States. 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 provide a reasonable basis for our
opinion.

As described more fully in Note 1 to the financial statements, these financial
statements were prepared in conformity with accounting practices prescribed or
permitted by the Bureau of Insurance, State Corporation Commission of the
Commonwealth of Virginia, which practices differ from accounting principles
generally accepted in the United states. The effects on the financial statements
of the variances between the statutory basis of accounting and accounting
principles generally accepted in the United States are material.

In our opinion, because of the effects of the matter discussed in the preceding
paragraph, the financial statements referred to above do not present fairly, in
conformity with accounting principles generally accepted in the United States,
the financial position of the Company as of December 31, 1998 or the results of
its operations or its cash flow for the years then ended.

In our opinion, the financial statements referred to above present fairly, in
all material respects, the admitted assets, liabilities, and surplus of the
Company as of December 31, 1998, and the results of its operations and its cash
flow for the year then ended, on the basis of accounting described in Note 1.

/s/ PRICEWATERHOUSECOOPERS LLP
PricewaterhouseCoopers LLP

Washington, D.C.
March 31, 1999

F-II- 2
<PAGE> 68

ACACIA NATIONAL LIFE INSURANCE COMPANY

STATEMENTS OF ADMITTED ASSETS, LIABILITIES AND SURPLUS -- STATUTORY BASIS
(COLUMNAR AMOUNTS IN THOUSANDS)

<TABLE>
<CAPTION>
DECEMBER 31,
--------------------
1999 1998
-------- --------
<S> <C> <C>
ADMITTED ASSETS
Investments
Bonds..................................................... $522,328 $556,127
Mortgage loans............................................ 894 --
Preferred stocks.......................................... 70 546
Common stocks............................................. 385 1,778
Short-term investments.................................... 5,685 13,614
Other investments......................................... 495 682
Loans on insurance policies............................... 7,955 7,579
-------- --------
Total investments...................................... 537,812 580,326
Cash........................................................ 5,195 64
Accrued investment income................................... 9,157 9,775
Reinsurance recoverable -- affiliate........................ 1,162 --
Income taxes receivable -- affiliate........................ 1,203 400
Other assets................................................ 370 2,169
Separate accounts........................................... 140,638 73,334
-------- --------
$695,537 $666,068
======== ========
LIABILITIES AND SURPLUS
LIABILITIES
Life and annuity reserves................................. $464,615 $483,126
Funds left on deposit..................................... 65,002 62,065
Reserve for unpaid claims................................. 1,461 2,113
Interest maintenance reserve.............................. 1,684 3,202
Accrued separate account transfers........................ (7,702) (6,297)
Accounts payable -- affiliates............................ 999 7,586
Other liabilities......................................... 2,927 3,736
Asset valuation reserve................................... 1,805 5,513
Separate accounts......................................... 140,638 73,334
-------- --------
671,429 634,378
-------- --------
SURPLUS
Preferred stock, 8% non-voting, non-cumulative, $1,000 par
value, 10,000 shares authorized; 6,000 shares issued
and outstanding........................................ 6,000 6,000
Common stock, $170 par value; 15,000 shares authorized,
issued and outstanding................................. 2,550 2,550
Additional paid-in capital................................ 13,450 13,450
Retained earnings......................................... 2,108 9,690
-------- --------
24,108 31,690
-------- --------
$695,537 $666,068
======== ========
</TABLE>

The accompanying notes are an integral part of these statutory basis financial
statements.

F-II- 3
<PAGE> 69

ACACIA NATIONAL LIFE INSURANCE COMPANY

STATEMENTS OF OPERATIONS -- STATUTORY BASIS
(IN THOUSANDS)

<TABLE>
<CAPTION>
YEARS ENDED
DECEMBER 31,
--------------------
1999 1998
-------- --------
<S> <C> <C>
INCOME
Premium income............................................ $ 79,057 $ 67,919
Less net reinsurance:
Yearly renewable term.................................. (5,318) (4,601)
-------- --------
Net premium income................................... 73,739 63,318
Funds left on deposit..................................... 8,257 8,292
Net investment income..................................... 41,553 46,305
Miscellaneous insurance income............................ 1,481 25
-------- --------
125,030 117,940
-------- --------
EXPENSES
Benefits to policyowners.................................. 86,472 83,190
Decrease in reserves...................................... (15,569) (18,937)
Commissions............................................... 7,256 7,353
General insurance expenses................................ 13,562 16,377
Taxes, licenses and fees.................................. 2,154 1,167
Amortization of goodwill.................................. 382 684
Net premium transferred to separate accounts.............. 34,764 30,725
-------- --------
129,021 120,559
-------- --------
Loss before federal income taxes and realized capital
losses................................................. (3,991) (2,619)
Income taxes (benefit).................................... (439) (1,822)
-------- --------
Loss before realized capital losses....................... (3,552) (797)
Realized capital losses (net of tax of ($972) and $760 and
transfers to interest maintenance reserve of ($1,111)
and $965 for 1999 and 1998, respectively).............. (6,244) (209)
-------- --------
Net loss.................................................. $ (9,796) $ (1,006)
======== ========
</TABLE>

The accompanying notes are an integral part of these statutory basis financial
statements.

F-II- 4
<PAGE> 70

ACACIA NATIONAL LIFE INSURANCE COMPANY

STATEMENTS OF CHANGES IN SURPLUS -- STATUTORY BASIS
FOR THE YEARS ENDED DECEMBER 31, 1999 AND 1998
(IN THOUSANDS, EXCEPT SHARES)

<TABLE>
<CAPTION>
PREFERRED STOCK COMMON STOCK ADDITIONAL
---------------- ---------------- PAID-IN RETAINED
SHARES AMOUNT SHARES AMOUNT CAPITAL EARNINGS TOTAL
------ ------ ------ ------ ---------- -------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
BALANCE, January 1, 1998............... 6,000 $6,000 15,000 $2,550 $13,450 $10,506 $32,506
Change in non-admitted assets........ -- -- -- -- -- 684 684
Change in net unrealized capital
gains.............................. -- -- -- -- -- (49) (49)
Change in valuation basis of
reserves........................... -- -- -- -- -- (120) (120)
Transfer to asset valuation
reserve............................ -- -- -- -- -- (325) (325)
Net loss............................. -- -- -- -- -- (1,006) (1,006)
----- ------ ------ ------ ------- ------- -------
BALANCE, December 31, 1998............. 6,000 6,000 15,000 2,550 13,450 9,690 31,690
Change in non-admitted assets........ -- -- -- -- -- (3) (3)
Change in net unrealized capital
gains.............................. -- -- -- -- -- (1,491) (1,491)
Transfer from asset valuation
reserve............................ -- -- -- -- -- 3,708 3,708
Net loss............................. -- -- -- -- -- (9,796) (9,796)
----- ------ ------ ------ ------- ------- -------
BALANCE, December 31, 1999............. 6,000 $6,000 15,000 $2,550 $13,450 $ 2,108 $24,108
===== ====== ====== ====== ======= ======= =======
</TABLE>

The accompanying notes are an integral part of these statutory basis financial
statements.

F-II- 5
<PAGE> 71

ACACIA NATIONAL LIFE INSURANCE COMPANY

STATEMENTS OF CASH FLOWS -- STATUTORY BASIS
(IN THOUSANDS)

<TABLE>
<CAPTION>
YEARS ENDED DECEMBER 31,
------------------------
1999 1998
---------- ----------
<S> <C> <C>
OPERATING ACTIVITIES:
Net premium income received............................... $ 74,462 $ 63,318
Miscellaneous insurance income............................ 8,904 8,176
Net investment income received............................ 43,690 44,953
Net premium transferred to separate accounts.............. (37,511) (34,192)
Benefits paid to policyowners............................. (89,096) (84,359)
Commissions, expenses and taxes, other than federal income
tax.................................................... (21,394) (23,804)
Federal income tax received............................... 608 2,596
Other operating income and disbursements.................. (7,174) 8,488
--------- ---------
Net cash used in operating activities..................... (27,511) (14,824)
--------- ---------
INVESTING ACTIVITIES:
Proceeds from investments sold, matured or repaid......... 337,366 182,412
Purchase of investments................................... (312,277) (161,169)
Net decrease (increase) in loans on insurance policies.... (376) 522
--------- ---------
Net cash provided by investing activities................. 24,713 21,765
--------- ---------
NET INCREASE (DECREASE) IN CASH AND SHORT-TERM
INVESTMENTS............................................... (2,798) 6,941
CASH AND SHORT-TERM INVESTMENTS -- BEGINNING OF PERIOD...... 13,678 6,737
--------- ---------
CASH AND SHORT-TERM INVESTMENTS -- END OF PERIOD............ $ 10,880 $ 13,678
========= =========
</TABLE>

The accompanying notes are an integral part of these statutory basis financial
statements.

F-II- 6
<PAGE> 72

ACACIA NATIONAL LIFE INSURANCE COMPANY

NOTES TO STATUTORY BASIS FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 1999 AND 1998
(IN THOUSANDS)

1. BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

ORGANIZATION AND NATURE OF OPERATIONS
Acacia National Life Insurance Company (the Company) is a wholly owned
subsidiary of Acacia Life Insurance Company (Acacia Life). Acacia Life is a
wholly owned subsidiary of Ameritas Holding Company (AHC) which is a wholly
owned subsidiary of Ameritas Acacia Mutual Holding Company (AAMHC).

The Board of Directors of Ameritas Mutual Insurance Holding Company (AMIHC) and
Acacia Mutual Holding Corporation (AMHC) approved and adopted a plan of merger
under which the two would merge to form AAMHC. In addition their two wholly
owned subsidiaries, AHC and Acacia Financial Group, Ltd. (AFG), would merge to
form Ameritas Holding Company. Public informational hearings on the proposed
merger were held on November 20, 1998 with the Nebraska Insurance Director and
on December 17, 1998 with the D.C. Insurance Commissioner. Following the
commissioner's approval a special meeting with the eligible members of AMHC was
held on December 22, 1998 and with the members of AMIHC on December 29, 1998.
With the members approval the merger became effective January 1, 1999. The
business combination was accounted for as a pooling of interests.

AMHC was formed in 1997 in conjunction with a plan of reorganization
(Reorganization) of the former Acacia Life, Acacia Mutual Life Insurance Company
(Acacia). Pursuant to the Reorganization which was approved by the Department of
Insurance and Securities Regulation of the District of Columbia and the eligible
members of Acacia and became effective June 30, 1997, Acacia was converted to a
mutual insurance holding company structure whereby AMHC and AFG were formed and
Acacia was converted to a stock life insurance company wholly owned by AFG. As
of the effective date of the reorganization, the membership interests and the
contractual rights of the policyowners of Acacia were separated -- the
membership interests automatically became, by operation of law, membership
interests in AMHC and the contractual rights remained in Acacia. Each person who
becomes the owner of a designated policy issued by Acacia after the effective
date of the Reorganization became a member of AMHC, now AAMHC.

The Company, domiciled in Virginia, underwrites and markets deferred and
immediate annuities and life insurance products within the United States and is
licensed to operate in 46 states and the District of Columbia. On December 1,
1995 and September 9, 1996, respectively, operations began for the Acacia
National Variable Life Insurance Separate Account I and Acacia National Variable
Annuity Separate Account II which are separate investment accounts within the
Company.

Non-insurance products and services are offered by an affiliate of the Company,
Acacia Financial Corporation (AFC), a wholly owned subsidiary of Acacia Life,
which is a holding company of several financial service companies. Principal
subsidiaries include: Calvert Group Ltd. (Calvert), a provider of investment
advisory, management and administrative services to The Calvert Group of mutual
funds; Acacia Federal Savings Bank (AFSB), a federally chartered savings bank;
and The Advisors Group, Inc., a broker/dealer.

BASIS OF PRESENTATION

The accompanying financial statements have been prepared, except as to form, on
the basis of accounting practices prescribed or permitted by the Bureau of
Insurance, State Corporate Commission of the Commonwealth of Virginia (statutory
basis or SAP), which are designed primarily to demonstrate ability to meet
claims of policyowners. These practices differ in certain respects, which in
some cases may be material, from generally accepted accounting principles (GAAP)
applied in the presentation of financial condition and results of operations on
the "going concern" basis commonly followed by other types of enterprises.

In March of 1998, the National Association of Insurance Commissioners adopted
the Codification of Statutory Accounting Principles (Codification). The
Codification, which is intended to standardize

F-II- 7
<PAGE> 73
ACACIA NATIONAL LIFE INSURANCE COMPANY
NOTES TO STATUTORY BASIS FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 1999 AND 1998 -- (CONTINUED)
(IN THOUSANDS)

1. BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES -- (CONTINUED)

BASIS OF PRESENTATION -- (CONTINUED)

regulatory accounting and reporting for the insurance industry, is proposed to
be effective January 1, 2001. However, statutory accounting principles will
continue to be established by individual state laws and permitted practices and
it is uncertain when, or if, the state of Virginia will require adoption of
Codification for the preparation of statutory financial statements. The Company
has not finalized the quantification of the effects of Codification on its
statutory financial statements.

The accompanying statutory financial statements vary in some respects from
generally accepted accounting principles. The most significant differences
include: (a) bonds are generally carried at amortized cost rather than being
valued at either amortized cost or fair value based on their classification
according to the Company's ability and intent to hold or trade the securities;
(b) costs related to acquiring new business are charged to operations as
incurred and not deferred, whereas premiums are taken into income on a pro rata
basis over the respective term of the policies; (c) policy reserves are carried
at amounts which approximate surrender values rather than accumulation values
and statutory investment reserves are established; (d) a provision has not been
made for federal income taxes resulting from all of the cumulative differences
in assets and liabilities determined on a tax return and financial statement
basis; and (e) changes in certain assets designated as "non-admitted" assets
have been charged to surplus.

In 1998, the Company's financial information was included in the determination
of consolidated GAAP amounts for Acacia Mutual Holding Corporation. The Acacia
National Life Insurance Company GAAP amounts were derived from this consolidated
financial information. The Company does not prepare separate financial
statements on a GAAP basis.

The impact of the estimated differences between SAP and GAAP in 1998 were as
follows:

<TABLE>
<CAPTION>
CAPITAL
NET LOSS AND SURPLUS
-------- -----------
<S> <C> <C>
AS REPORTED UNDER SAP....................................... $(1,006) $ 31,690
Adjustments:
Deferred policy acquisition costs......................... 2,874 58,017
AVR and IMR............................................... 615 8,715
Deferred Federal income tax............................... (732) (20,077)
Net policyholder liabilities.............................. (1,601) (11,291)
Investments............................................... (59) 20,013
Other..................................................... (500) (946)
------- --------
AMOUNTS UNDER GAAP.......................................... $ (409) $ 86,121
======= ========
</TABLE>

For 1999, it is not practicable to determine the above information.

USE OF ESTIMATES
The preparation of financial statements in conformity with statutory accounting
practices requires management to make estimates and assumptions that affect the
reported amounts of assets and liabilities and disclosure of contingent assets
and liabilities at the date of the financial statements and the reported amounts
of revenues and expenses during the reporting period. Actual results could
differ from those estimates.

F-II- 8
<PAGE> 74
ACACIA NATIONAL LIFE INSURANCE COMPANY
NOTES TO STATUTORY BASIS FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 1999 AND 1998 -- (CONTINUED)
(IN THOUSANDS)

USE OF ESTIMATES -- (CONTINUED)
The principal accounting and reporting practices followed are:

INVESTMENTS
Investments are reported according to valuation procedures prescribed by the
National Association of Insurance Commissioners (NAIC), and generally: bonds and
mortgage loans are valued at amortized cost; preferred stock at cost; common
stock at fair value; other investments on the equity method; and separate
account assets are carried at fair value.

Realized capital gains and losses, including valuation allowances on specific
investments, are recorded in the Statement of Operations and unrealized gains
and losses are credited or charged to retained earnings.

SEPARATE ACCOUNTS
The Company operates separate accounts on which the earnings or losses accrue
exclusively to contract holders. The assets (mutual fund investments) and
liabilities of each account are clearly identifiable and distinguishable from
other assets and liabilities of the Company. Amounts are reported at fair value.

NON-ADMITTED ASSETS
Certain assets (primarily goodwill) are designated as "non-admitted" under
statutory accounting requirements. These assets are excluded from the statements
of admitted assets, liabilities and surplus by adjustments to retained earnings.
Total "non-admitted assets" were $2,981 and $2,978 in 1999 and 1998,
respectively.

RESERVES
Life policy reserves are computed by using the Commissioners Reserve Valuation
Method (CRVM) and the Commissioners Standard Ordinary Mortality table. Annuity
reserves are calculated using the Commissioners Annuity Reserve Valuation Method
(CARVM) and the maximum valuation interest rate; for annuities with life
contingencies, the prescribed valuation mortality table is used. Reserves for
unpaid claims include claims reported and unpaid and claims not yet reported,
the latter estimated on the basis of historical experience. As such amounts are
necessarily estimates, the ultimate liability will differ from the amount
recorded and will be reflected in operations when additional information becomes
known.

Accrued separate account transfers primarily consists of the amount of
policyholder account values over modified reserves used in the separate account,
such as the use of CARVM and CRVM.

The interest maintenance reserve (IMR) is calculated based on the prescribed
methods developed by the NAIC. Realized gains and losses, net of tax, resulting
from interest rate changes on fixed income investments are deferred and credited
to this reserve. These gains and losses are then amortized into investment
income over what would have been the remaining years to maturity of the
underlying investment. Amortization included in net investment income was $407
and $350 for 1999 and 1998, respectively.

The asset valuation reserve (AVR) is a required appropriation of surplus to
provide for possible losses that may occur on certain investments held by the
Company. The reserve is computed based on holdings of bonds, stocks, and
short-term investments and realized and unrealized gains and losses, other than
those resulting from interest rate changes. Changes in the reserve are charged
or credited to retained earnings.

INCOME TAXES
The Company, beginning in 1999, will file a consolidated tax return with Acacia
Life Insurance Company. Prior to 1999, Acacia National filed a consolidated
return with Acacia Mutual Holding Corporation and its

F-II- 9
<PAGE> 75
ACACIA NATIONAL LIFE INSURANCE COMPANY
NOTES TO STATUTORY BASIS FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 1999 AND 1998 -- (CONTINUED)
(IN THOUSANDS)

USE OF ESTIMATES -- (CONTINUED)
INCOME TAXES -- (CONTINUED)
subsidiaries. An agreement among the members of the consolidated group,
generally, provides for distribution of consolidated tax results as if filed on
a separate return basis.

The Company's federal income tax returns have been examined by and settled with
the Internal Revenue Service through 1995.

Under statutory accounting practices, no provision is made for deferred federal
income taxes related to temporary differences between statutory and taxable
income. Such temporary differences arise primarily from capitalization and
amortization of deferred policy acquisition costs, certain reserve calculations
and recognition of realized gains or losses on sales of bonds.

Federal income tax regulations allowed certain special deductions for 1983 and
prior years which are accumulated in a memorandum tax account designated as
"policyholders' surplus". Generally, this policyholders' surplus account (PSA)
will become subject to tax at the then current rates only if the accumulated PSA
exceeds certain maximum limitations or if certain cash distributions are deemed
to be paid out of the account. At December 31, 1999 and 1998, the Company has
$6.6 million in their policyholders' surplus accounts which is not reflected in
the financial statements.

RECOGNITION OF PREMIUM INCOME AND RELATED EXPENSES
Premiums are reported as income when collected over the premium paying periods
of the policies. Annuity and fund deposits are included as income when received.
Policy acquisition costs, such as commissions and other marketing and issuance
expenses incurred in connection with acquiring new business, are charged to
operations as incurred. Premium income consists of:

<TABLE>
<CAPTION>
YEARS ENDED
DECEMBER 31
------------------
1999 1998
------- -------
<S> <C> <C>
Life........................................................ $27,747 $23,552
Annuity..................................................... 51,310 44,367
------- -------
$79,057 $67,919
======= =======
</TABLE>

RECLASSIFICATIONS
Certain items on the prior year financial statements have been reclassified to
conform to current year presentation.

2. FINANCIAL INSTRUMENTS

The following methods and assumptions were used to estimate the fair value of
each class of financial instrument for which it is practicable to estimate a
value:

BONDS -- For publicly traded securities, fair value is determined
using an independent pricing source. For securities without a readily
ascertainable fair value, fair value has been determined using an interest
rate spread matrix based upon quality, weighted average maturity and
Treasury yields.

MORTGAGE LOANS -- Mortgage loans in good standing are valued on the
basis of discounted cash flow. The interest rate that is assumed is based
upon the weighted average term of the mortgage and appropriate spread over
Treasuries. There were no mortgage loans in default at December 31, 1999.

PREFERRED STOCKS -- For publicly traded securities, fair value is
determined using an independent pricing source.

F-II- 10
<PAGE> 76
ACACIA NATIONAL LIFE INSURANCE COMPANY
NOTES TO STATUTORY BASIS FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 1999 AND 1998 -- (CONTINUED)
(IN THOUSANDS)

2. FINANCIAL INSTRUMENTS -- (CONTINUED)
COMMON STOCKS -- For publicly traded securities, fair value is
determined using an independent pricing source.

SHORT-TERM INVESTMENTS -- The carrying amount approximates fair value
because of the short maturity of these instruments.

OTHER INVESTMENTS -- Fair value for venture capital partnerships is
estimated based on values as last reported by the partnership and
discounted for their lack of marketability.

LOANS ON INSURANCE POLICIES -- Fair values for loans on insurance
policies are estimated using a discounted cash flow analysis at interest
rates currently offered for similar loans. Loans on insurance policies with
similar characteristics are aggregated for purposes of the calculations.

CASH -- The carrying amount equals fair value.

ACCRUED INVESTMENT INCOME -- Fair value of accrued investment income
equals book value.

INVESTMENT-TYPE CONTRACTS -- Reserves held on investment-type
insurance contracts, i.e. contracts which do not contain significant
morbidity risks, are carried at amounts which approximate fair value.

FUNDS LEFT ON DEPOSIT -- Funds on deposit which do not have fixed
maturities are carried at the amount payable on demand at the reporting
date.

The estimated fair values of the Company's financial instruments are as follows:

<TABLE>
<CAPTION>
DECEMBER 31,
--------------------------------------------
1999 1998
-------------------- --------------------
CARRYING FAIR CARRYING FAIR
AMOUNT VALUE AMOUNT VALUE
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Financial assets:
Bonds............................................. $522,328 $517,993 $556,127 $591,776
Preferred stocks.................................. 70 106 546 798
Common stocks..................................... 385 385 1,778 1,778
Mortgage loans.................................... 894 861 -- --
Short-term investments............................ 5,685 5,685 13,614 13,614
Other investments................................. 495 495 682 682
Loans on insurance policies....................... 7,955 6,816 7,579 6,996
Cash.............................................. 5,195 5,195 64 64
Accrued investment income......................... 9,157 9,157 9,775 9,775
Financial Liabilities:
Investment-type contracts......................... $357,515 $357,515 $380,641 $380,641
Funds left on deposit............................. 65,002 65,002 62,065 62,065
</TABLE>

These values do not necessarily represent the value for which the financial
instrument could be sold.

F-II- 11
<PAGE> 77
ACACIA NATIONAL LIFE INSURANCE COMPANY
NOTES TO STATUTORY BASIS FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 1999 AND 1998 -- (CONTINUED)
(IN THOUSANDS)

3. INVESTMENTS

The table below provides additional information relating to bonds and stocks
held by the Company as of December 31, 1999:

<TABLE>
<CAPTION>
DECEMBER 31, 1999
----------------------------------------------------
GROSS UNREALIZED
AMORTIZED --------------------- FAIR
COST GAINS LOSSES VALUE
--------- ------- ------- --------
<S> <C> <C> <C> <C>
U.S. Corporate................................. $292,892 $ 6,818 $ 8,603 $291,107
Mortgage-backed................................ 102,157 803 2,465 100,495
U.S. Treasury securities and obligations of
U.S. government agencies..................... 68,397 3,284 314 71,367
Foreign........................................ 15,237 15 603 14,649
Asset backed................................... 43,645 9 3,279 40,375
-------- ------- ------- --------
Total bonds.................................. $522,328 $10,929 $15,264 $517,993
-------- ------- ------- --------
Preferred stocks............................... $ 70 $ 36 $ -- $ 106
-------- ------- ------- --------
Common stocks.................................. $ 1,137 $ -- $ 752 $ 385
-------- ------- ------- --------
</TABLE>

The comparative data as of December 31, 1998 is summarized as follows:

<TABLE>
<CAPTION>
DECEMBER 31, 1998
----------------------------------------------------
GROSS UNREALIZED
AMORTIZED --------------------- FAIR
COST GAINS LOSSES VALUE
--------- ------- ------ --------
<S> <C> <C> <C> <C>
U.S. Corporate................................. $294,538 $24,557 $2,729 $316,366
Mortgage-backed................................ 166,042 4,928 708 170,262
U.S. Treasury securities and obligations of
U.S. government agencies..................... 72,543 9,705 -- 82,248
Foreign........................................ 23,004 624 728 22,900
-------- ------- ------ --------
Total bonds.................................. $556,127 $39,814 $4,165 $591,776
-------- ------- ------ --------
Preferred stocks............................... $ 546 $ 252 $ -- $ 798
-------- ------- ------ --------
Common stocks.................................. $ 1,870 $ 118 $ 210 $ 1,778
-------- ------- ------ --------
</TABLE>

The amortized cost and fair value of bonds at December 31, 1999 are shown below.
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.

<TABLE>
<CAPTION>
AMORTIZED FAIR
COST VALUE
--------- --------
<S> <C> <C>
Due in one year or less..................................... $ 18,671 $ 18,764
Due after one year through five years....................... 148,661 149,293
Due after five years through ten years...................... 106,308 105,839
Due after ten years......................................... 102,886 103,227
Mortgage-backed securities.................................. 102,157 100,495
Asset backed................................................ 43,645 40,375
-------- --------
Total..................................................... $522,328 $517,993
======== ========
</TABLE>

At December 31, 1999, the Company had bonds with a book value of $6,870 and a
fair value of $7,818 on deposit with various State Insurance Departments.

F-II- 12
<PAGE> 78
ACACIA NATIONAL LIFE INSURANCE COMPANY
NOTES TO STATUTORY BASIS FINANCIAL STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 1999 AND 1998 -- (CONTINUED)
(IN THOUSANDS)

3. INVESTMENTS -- (CONTINUED)
Sales of bond investments in 1999 and 1998 resulted in proceeds of $294,291 and
$112,603, respectively. Gains of $1,489 and $505 and losses of $3,316 and $50
were realized on those sales in 1999 and 1998, respectively.

The Company's bond investment portfolio is predominantly comprised of investment
grade securities. At December 31, 1999 and 1998, approximately $16,276 and
$8,865, respectively, in bonds (3.1% and 1.6%, respectively, of the total bond
portfolio) are considered "below investment grade". Securities are classified as
"below investment grade" by utilizing rating criteria established by the NAIC.
During 1999, the Company took other than temporary write downs on bonds of
$6,759.

4. RELATED PARTY TRANSACTIONS

The Company has no employees, affiliates (primarily Acacia Life and Ameritas
entities) provide technical, financial, legal, marketing and investment advisory
support to the Company under various administrative service agreements. The cost
of these services to the Company for years ended December 31, 1999 and 1998 was
$15,929 and $17,695, respectively.

The Company entered into reinsurance agreements (yearly renewable term) with
affiliates. Under these agreements, these affiliates assume life insurance risk
in excess of the Company's retention limit. These reinsurance contracts do not
relieve the Company of its obligations to its policyowners, (see footnote 5).

The assets of the defined contribution plan under Internal Revenue Code Section
401(k) for the employees of Acacia Life include an investment in a deposit
administration contract with the Company of $18,305 and $18,665 at December 31,
1999 and 1998, respectively.

5. REINSURANCE

The Company reinsures all life insurance risks over its retention limit of ten
thousand per policy under yearly renewable term insurance agreements with Acacia
Life and several other non-affiliated companies. The Company remains obligated
for amounts ceded in the event that reinsurers do not meet their obligations.
Since the reinsurance treaties are of such a nature as to pass economic risk to
the reinsurer, appropriate reductions are made from income, claims, expense and
liability items in accounting for the reinsurance ceded.

Premiums and benefits have been reduced by amounts reinsured as follows:

<TABLE>
<CAPTION>
1999 1998
------ ------
<S> <C> <C>
Premiums ceded:
Acacia Life............................................... $4,634 $3,971
Others.................................................... 684 630
------ ------
Total premium ceded......................................... $5,318 $4,601
====== ======
Death benefits reimbursed:
Acacia Life............................................... $3,186 $3,610
Others.................................................... 1,082 233
------ ------
Total benefits reimbursed................................... $4,268 $3,843
====== ======
Life and annuity reserves ceded:
Acacia Life............................................... $2,501 $2,108
Others.................................................... 497 392
------ ------
Total life and annuity reserves ceded....................... $2,998 $2,500
====== ======
</TABLE>

F-II- 13
<PAGE> 79

APPENDIX A

ILLUSTRATIONS
The following tables indicate how the account values and Death Benefit
Proceeds vary with the investment experience of the Funds and differences
between the guaranteed and current costs of the Policy. The tables show how the
account values and Death Benefit Proceeds of a Policy, issued to an Insured of a
certain age with regular annual premiums, differ over time if the investment
return on the assets of each Portfolio were a uniform annual rate of 0%, 8% and
12%. The tables beginning on page A-2 illustrate a Policy issued to a male, age
35, under a standard non-smoker rate class. The account values and Death Benefit
Proceeds would be different from those shown if the gross annual investment
rates of return averaged 0%, 8% and 12% over a period of years but fluctuated
above and below those averages for individual Policy years. The values also
assume that no loans or partial surrenders are made by the Owner.

The columns headed Guaranteed Charges reflect that throughout the life of
the Policy the monthly charge for the cost of insurance is based on the maximum
level permitted under the Policy, a Premium expense charge of 2.25%, a monthly
administrative charge of $27 for the first Policy year and $8 each month
thereafter, and a daily charge for mortality and expense risks equal to an
annual rate of .90% for the first fifteen years. This charge is then reduced by
.05% each year until it reaches .45% in the 24th year and thereafter. The
columns headed Current Charges assume that, throughout the life of the Policy,
the monthly cost of insurance is based on the current cost of insurance rate, a
Premium expense charge of 2.25%, a monthly administrative charge of $27 for the
first Policy year and $8 each month thereafter and a daily charge for mortality
and expense risks equal to an annual rate of .90% for the first fifteen years.
This charge is then reduced by .05% each year until it reaches .45% in the 25th
year and thereafter.

The amounts shown in the tables for account values and Death Benefit
Proceeds reflect that the net investment return of the Portfolios is lower than
the gross return listed due to investment advisory and other fees of the Funds.
The values shown take into account an average of the expenses paid by each
portfolio available for investment at an equivalent annual rate of 0.90% (which
is in excess of the current equivalent annual rate of 0.86% of the aggregate
average daily net assets of the Funds). The investment adviser or other
affiliates of various Funds have agreed to reimburse the portfolios to the
extent that the aggregate operating expenses (certain portfolios may exclude
certain items) were in excess of an annual rate of average daily net assets.
These agreements are expected to continue in future years but may be terminated
at any time. As long as the expense limitations continue for a portfolio, if a
reimbursement occurs, it has the effect of lowering the portfolio's expense
ratio and increasing its total return. After a deduction of these amounts, the
illustrated gross investment rates of 0%, 8%, and 12% correspond to approximate
net annual rates of -1.80%, 6.20% and 10.20% respectively.

The hypothetical values shown in the tables do not reflect any charges for
federal income taxes against the Variable Account, since ANLIC is not currently
making such charges. However, such charges may be made in the future and, in
that event, the gross annual investment rate of return would have to exceed 0%,
8% and 12% by an amount to cover the tax charges to produce the Death Benefit
Proceeds and account values illustrated. (See the section on Federal Tax
Considerations.)

The tables illustrate the Policy values that would result based upon
hypothetical investment rates and premium payment schedules, if all net premiums
are allocated to the Variable Account and if no Policy loans, partial surrenders
or changes in benefits are applied for. Upon request, ANLIC will provide a
comparable illustration based upon the Insured's age, sex, rate class, face
amount or premium schedule requested, and additional benefits. For unisex
policies, ANLIC will supply such illustrations without regard to the Insured's
sex. ANLIC reserves the right to charge a fee not to exceed $25 for this
service.

ALLOCATOR 2000
A- 1
<PAGE> 80

ACACIA NATIONAL LIFE INSURANCE COMPANY

ALLOCATOR 2000 FLEXIBLE PREMIUM VARIABLE LIFE

Prepared for: Valued Client Annual Premium: $ 1,838
Male Age 35 Non-Tobacco Riders: None Option A Face Amount $250,000

<TABLE>
<CAPTION>
12.00% HYPOTHETICAL GROSS ANNUAL RATE OF RETURN
CURRENT CHARGES GUARANTEED CHARGES
--------------------------------- ---------------------
END OF NET ANNUAL ACCOUNT SURRENDER DEATH SURRENDER DEATH
YEAR AGE OUTLAY VALUE VALUE BENEFIT VALUE BENEFIT
- ------ --- ---------- ------- --------- ------- --------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
1 36 1,838 1,197 645 250,000 645 250,000
2 37 1,838 2,737 2,186 250,000 2,173 250,000
3 38 1,838 4,407 3,856 250,000 3,829 250,000
4 39 1,838 6,217 5,666 250,000 5,623 250,000
5 40 1,838 8,183 7,632 250,000 7,569 250,000
6 41 1,838 10,312 9,760 250,000 9,676 250,000
7 42 1,838 12,617 12,066 250,000 11,958 250,000
8 43 1,838 15,120 14,753 250,000 14,616 250,000
9 44 1,838 17,834 17,651 250,000 17,482 250,000
10 45 1,838 20,781 20,781 250,000 20,575 250,000
11 46 1,838 23,978 23,978 250,000 23,730 250,000
12 47 1,838 27,448 27,448 250,000 27,152 250,000
13 48 1,838 31,218 31,218 250,000 30,867 250,000
14 49 1,838 35,317 35,317 250,000 34,904 250,000
15 50 1,838 39,775 39,775 250,000 39,291 250,000
16 51 1,838 44,644 44,644 250,000 44,079 250,000
17 52 1,838 49,964 49,964 250,000 49,307 250,000
18 53 1,838 55,780 55,780 250,000 55,019 250,000
19 54 1,838 62,144 62,144 250,000 61,265 250,000
20 55 1,838 69,119 69,119 250,000 68,104 250,000
25 60 1,838 116,076 116,076 250,000 114,047 250,000
30 65 1,838 194,211 194,211 250,000 190,287 250,000
35 70 1,838 327,327 327,327 379,699 319,357 370,454
40 75 1,838 546,948 546,948 585,235 529,078 566,113
45 80 1,838 910,835 910,835 956,377 873,967 917,666
50 85 1,838 1,502,043 1,502,043 1,577,146 1,421,806 1,492,897
55 90 1,838 2,446,560 2,446,560 2,568,888 2,271,862 2,385,455
60 95 1,838 4,001,649 4,001,649 4,041,666 3,658,602 3,695,188
</TABLE>

THE HYPOTHETICAL INVESTMENT RATES OF RETURN SHOWN ABOVE AND ELSEWHERE IN
THIS PROSPECTUS ARE ILLUSTRATIVE ONLY AND SHOULD NOT BE DEEMED A REPRESENTATION
OF PAST OR FUTURE INVESTMENT RATES OF RETURN. ACTUAL INVESTMENT RATES OF RETURN
MAY BE MORE OR LESS THAN THOSE SHOWN AND DEPEND ON A NUMBER OF FACTORS,
INCLUDING THE INVESTMENT ALLOCATIONS BY AN OWNER AND THE DIFFERENT INVESTMENT
RATE OF RETURN FOR THE FUND PORTFOLIOS. THE DEATH BENEFIT AND ACCOUNT VALUE FOR
A POLICY WOULD BE DIFFERENT FROM THOSE SHOWN IF THE ACTUAL INVESTMENT RATE OF
RETURN AVERAGED 12% OVER A PERIOD OF YEARS, BUT FLUCTUATED ABOVE OR BELOW THOSE
AVERAGES FOR INDIVIDUAL POLICY YEARS. NO REPRESENTATION CAN BE MADE BY ANLIC OR
THE FUNDS THAT THIS HYPOTHETICAL INVESTMENT RATE OF RETURN CAN BE ACHIEVED FOR
ANY ONE YEAR OR OVER A PERIOD OF TIME.

ALLOCATOR 2000
A- 2
<PAGE> 81

ACACIA NATIONAL LIFE INSURANCE COMPANY

ALLOCATOR 2000 FLEXIBLE PREMIUM VARIABLE LIFE

Prepared for: Valued Client Annual Premium: $ 1,838

Male Age 35 Non-Tobacco Riders: None Option A Face Amount $250,000

<TABLE>
<CAPTION>
8.00% HYPOTHETICAL GROSS ANNUAL RATE OF RETURN
CURRENT CHARGES GUARANTEED CHARGES
----------------------------- -------------------
END OF NET ANNUAL ACCOUNT SURRENDER DEATH SURRENDER DEATH
YEAR AGE OUTLAY VALUE VALUE BENEFIT VALUE BENEFIT
------ --- ---------- ------- --------- ------- --------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
1... 36 1,838 1,140 589 250,000 589 250,000
2... 37 1,838 2,569 2,018 250,000 2,005 250,000
3... 38 1,838 4,058 3,507 250,000 3,481 250,000
4... 39 1,838 5,610 5,059 250,000 5,019 250,000
5... 40 1,838 7,229 6,678 250,000 6,620 250,000
6... 41 1,838 8,910 8,359 250,000 8,282 250,000
7... 42 1,838 10,655 10,104 250,000 10,007 250,000
8... 43 1,838 12,469 12,101 250,000 11,982 250,000
9... 44 1,838 14,349 14,165 250,000 14,021 250,000
10.. 45 1,838 16,299 16,299 250,000 16,125 250,000
11.. 46 1,838 18,316 18,316 250,000 18,110 250,000
12.. 47 1,838 20,399 20,399 250,000 20,158 250,000
13.. 48 1,838 22,551 22,551 250,000 22,271 250,000
14.. 49 1,838 24,772 24,772 250,000 24,447 250,000
15.. 50 1,838 27,059 27,059 250,000 26,685 250,000
16.. 51 1,838 29,423 29,423 250,000 28,994 250,000
17.. 52 1,838 31,859 31,859 250,000 31,368 250,000
18.. 53 1,838 34,360 34,360 250,000 33,802 250,000
19.. 54 1,838 36,922 36,922 250,000 36,286 250,000
20.. 55 1,838 39,538 39,538 250,000 38,815 250,000
25.. 60 1,838 53,227 53,227 250,000 51,876 250,000
30.. 65 1,838 66,183 66,183 250,000 63,686 250,000
35.. 70 1,838 78,873 78,873 250,000 69,324 250,000
40.. 75 1,838 93,580 93,580 250,000 57,560 250,000
45.. 80 1,838 106,518 106,518 250,000 -- --
50.. 85 1,838 109,942 109,942 250,000 -- --
55.. 90 1,838 74,382 74,382 250,000 -- --
59.. 94 1,838 -- -- -- -- --
</TABLE>

THE HYPOTHETICAL INVESTMENT RATES OF RETURN SHOWN ABOVE AND ELSEWHERE IN THIS
PROSPECTUS ARE ILLUSTRATIVE ONLY AND SHOULD NOT BE DEEMED A REPRESENTATION OF
PAST OR FUTURE INVESTMENT RATES OF RETURN. ACTUAL INVESTMENT RATES OF RETURN MAY
BE MORE OR LESS THAN THOSE SHOWN AND DEPEND ON A NUMBER OF FACTORS, INCLUDING
THE INVESTMENT ALLOCATIONS BY AN OWNER AND THE DIFFERENT INVESTMENT RATE OF
RETURN FOR THE FUND PORTFOLIOS. THE DEATH BENEFIT AND ACCOUNT VALUE FOR A POLICY
WOULD BE DIFFERENT FROM THOSE SHOWN IF THE ACTUAL INVESTMENT RATE OF RETURN
AVERAGED 8% OVER A PERIOD OF YEARS, BUT FLUCTUATED ABOVE OR BELOW THOSE AVERAGES
FOR INDIVIDUAL POLICY YEARS. NO REPRESENTATION CAN BE MADE BY ANLIC OR THE FUNDS
THAT THIS HYPOTHETICAL INVESTMENT RATE OF RETURN CAN BE ACHIEVED FOR ANY ONE
YEAR OR OVER A PERIOD OF TIME.

ALLOCATOR 2000
A- 3
<PAGE> 82

ACACIA NATIONAL LIFE INSURANCE COMPANY
ALLOCATOR 2000 FLEXIBLE PREMIUM VARIABLE LIFE
Prepared for: Valued Client Annual Premium: $ 1,838
Male Age 35 Non-Tobacco Riders: None Option A Face Amount $250,000

<TABLE>
<CAPTION>
0.00% HYPOTHETICAL GROSS ANNUAL RATE OF RETURN
CURRENT CHARGES GUARANTEED CHARGES
----------------------------- -------------------
END OF NET ANNUAL ACCOUNT SURRENDER DEATH SURRENDER DEATH
YEAR AGE OUTLAY VALUE VALUE BENEFIT VALUE BENEFIT
- ------ --- ---------- ------- --------- ------- --------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
1 36 1,838 1,029 477 250,000 477 250,000
2 37 1,838 2,247 1,695 250,000 1,683 250,000
3 38 1,838 3,416 2,865 250,000 2,840 250,000
4 39 1,838 4,535 3,983 250,000 3,948 250,000
5 40 1,838 5,604 5,053 250,000 5,003 250,000
6 41 1,838 6,616 6,065 250,000 6,001 250,000
7 42 1,838 7,569 7,018 250,000 6,941 250,000
8 43 1,838 8,464 8,097 250,000 8,004 250,000
9 44 1,838 9,296 9,112 250,000 9,005 250,000
10 45 1,838 10,063 10,063 250,000 9,938 250,000
11 46 1,838 10,760 10,760 250,000 10,615 250,000
12 47 1,838 11,380 11,380 250,000 11,217 250,000
13 48 1,838 11,924 11,924 250,000 11,739 250,000
14 49 1,838 12,385 12,385 250,000 12,177 250,000
15 50 1,838 12,758 12,758 250,000 12,525 250,000
16 51 1,838 13,039 13,039 250,000 12,778 250,000
17 52 1,838 13,216 13,216 250,000 12,926 250,000
18 53 1,838 13,275 13,275 250,000 12,953 250,000
19 54 1,838 13,201 13,201 250,000 12,842 250,000
20 55 1,838 12,977 12,977 250,000 12,577 250,000
25 60 1,838 9,013 9,013 250,000 8,325 250,000
30 65 1,838 -- -- 250,000 -- 250,000
35 70 -- -- -- -- -- --
</TABLE>

THE HYPOTHETICAL INVESTMENT RATES OF RETURN SHOWN ABOVE AND ELSEWHERE IN THIS
PROSPECTUS ARE ILLUSTRATIVE ONLY AND SHOULD NOT BE DEEMED A REPRESENTATION OF
PAST OR FUTURE INVESTMENT RATES OF RETURN. ACTUAL INVESTMENT RATES OF RETURN MAY
BE MORE OR LESS THAN THOSE SHOWN AND DEPEND ON A NUMBER OF FACTORS, INCLUDING
THE INVESTMENT ALLOCATIONS BY AN OWNER AND THE DIFFERENT INVESTMENT RATE OF
RETURN FOR THE FUND PORTFOLIOS. THE DEATH BENEFIT AND ACCOUNT VALUE FOR A POLICY
WOULD BE DIFFERENT FROM THOSE SHOWN IF THE ACTUAL INVESTMENT RATE OF RETURN
AVERAGED 0% OVER A PERIOD OF YEARS, BUT FLUCTUATED ABOVE OR BELOW THOSE AVERAGES
FOR INDIVIDUAL POLICY YEARS. NO REPRESENTATION CAN BE MADE BY ANLIC OR THE FUNDS
THAT THIS HYPOTHETICAL INVESTMENT RATE OF RETURN CAN BE ACHIEVED FOR ANY ONE
YEAR OR OVER A PERIOD OF TIME.

ALLOCATOR 2000
A- 4
<PAGE> 83

<TABLE>
<CAPTION>
12.00% HYPOTHETICAL GROSS ANNUAL RATE OF RETURN
CURRENT CHARGES GUARANTEED CHARGES
--------------------------------- -------------------
END OF NET ANNUAL ACCOUNT SURRENDER DEATH SURRENDER DEATH
YEAR AGE OUTLAY VALUE VALUE BENEFIT VALUE BENEFIT
- ------ --- ---------- --------- --------- --------- --------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
1 36 1,838 1,194 643 251,194 643 251,194
2 37 1,838 2,730 2,179 252,730 2,166 252,717
3 38 1,838 4,391 3,840 254,391 3,812 254,363
4 39 1,838 6,187 5,636 256,187 5,592 256,143
5 40 1,838 8,132 7,581 258,132 7,517 258,068
6 41 1,838 10,231 9,679 260,231 9,593 260,145
7 42 1,838 12,496 11,945 262,496 11,834 262,386
8 43 1,838 14,946 14,578 264,946 14,438 264,805
9 44 1,838 17,590 17,406 267,590 17,233 267,417
10 45 1,838 20,446 20,446 270,446 20,234 270,234
11 46 1,838 23,527 23,527 273,527 23,271 273,271
12 47 1,838 26,850 26,850 276,850 26,543 276,543
13 48 1,838 30,435 30,435 280,435 30,071 280,071
14 49 1,838 34,302 34,302 284,302 33,872 283,872
15 50 1,838 38,471 38,471 288,471 37,966 287,966
16 51 1,838 42,980 42,980 292,980 42,389 292,389
17 52 1,838 47,853 47,853 297,853 47,164 297,164
18 53 1,838 53,112 53,112 303,112 52,313 302,313
19 54 1,838 58,786 58,786 308,786 57,859 307,859
20 55 1,838 64,903 64,903 314,903 63,829 313,829
25 60 1,838 103,389 103,389 353,389 101,210 351,210
30 65 1,838 157,555 157,555 407,555 153,283 403,283
35 70 1,838 237,409 237,409 487,409 222,203 472,203
40 75 1,838 362,146 362,146 612,146 307,679 557,679
45 80 1,838 551,258 551,258 801,258 401,683 651,683
50 85 1,838 832,477 832,477 1,082,477 487,926 737,926
55 90 1,838 1,233,634 1,233,634 1,483,634 527,018 777,018
60 95 1,838 1,840,116 1,840,116 2,090,116 461,827 711,827
</TABLE>

THE HYPOTHETICAL INVESTMENT RATES OF RETURN SHOWN ABOVE AND ELSEWHERE IN THIS
PROSPECTUS ARE ILLUSTRATIVE ONLY AND SHOULD NOT BE DEEMED A REPRESENTATION OF
PAST OR FUTURE INVESTMENT RATES OF RETURN. ACTUAL INVESTMENT RATES OF RETURN MAY
BE MORE OR LESS THAN THOSE SHOWN AND DEPEND ON A NUMBER OF FACTORS, INCLUDING
THE INVESTMENT ALLOCATIONS BY AN OWNER AND THE DIFFERENT INVESTMENT RATE OF
RETURN FOR THE FUND PORTFOLIOS. THE DEATH BENEFIT AND ACCOUNT VALUE FOR A POLICY
WOULD BE DIFFERENT FROM THOSE SHOWN IF THE ACTUAL INVESTMENT RATE OF RETURN
AVERAGED 12% OVER A PERIOD OF YEARS, BUT FLUCTUATED ABOVE OR BELOW THOSE
AVERAGES FOR INDIVIDUAL POLICY YEARS. NO REPRESENTATION CAN BE MADE BY ANLIC OR
THE FUNDS THAT THIS HYPOTHETICAL INVESTMENT RATE OF RETURN CAN BE ACHIEVED FOR
ANY ONE YEAR OR OVER A PERIOD OF TIME.

ALLOCATOR 2000
A- 5
<PAGE> 84

ACACIA NATIONAL LIFE INSURANCE COMPANY

ALLOCATOR 2000 FLEXIBLE PREMIUM VARIABLE LIFE

Prepared for: Valued Client Annual Premium: $ 1,838

Male Age 35 Non-Tobacco Riders: None Option B Face Amount $250,000

<TABLE>
<CAPTION>
8.00% HYPOTHETICAL GROSS ANNUAL RATE OF RETURN
CURRENT CHARGES GUARANTEED CHARGES
----------------------------- -------------------
END OF NET ANNUAL ACCOUNT SURRENDER DEATH SURRENDER DEATH
YEAR AGE OUTLAY VALUE VALUE BENEFIT VALUE BENEFIT
- ------ --- ---------- ------- --------- ------- --------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
1 36 1,838 1,138 587 251,138 587 251,138
2 37 1,838 2,562 2,011 252,562 1,998 252,549
3 38 1,838 4,043 3,492 254,043 3,466 254,017
4 39 1,838 5,583 5,032 255,583 4,991 255,542
5 40 1,838 7,185 6,633 257,185 6,574 257,126
6 41 1,838 8,842 8,291 258,842 8,212 258,764
7 42 1,838 10,555 10,004 260,555 9,906 260,457
8 43 1,838 12,329 11,962 262,329 11,839 262,206
9 44 1,838 14,158 13,975 264,158 13,827 264,010
10 45 1,838 16,045 16,045 266,045 15,867 265,867
11 46 1,838 17,983 17,983 267,983 17,771 267,771
12 47 1,838 19,971 19,971 269,971 19,722 269,722
13 48 1,838 22,006 22,006 272,006 21,717 271,717
14 49 1,838 24,085 24,085 274,085 23,750 273,750
15 50 1,838 26,204 26,204 276,204 25,816 275,816
16 51 1,838 28,364 28,364 278,364 27,919 277,919
17 52 1,838 30,555 30,555 280,555 30,046 280,046
18 53 1,838 32,764 32,764 282,764 32,184 282,184
19 54 1,838 34,976 34,976 284,976 34,315 284,315
20 55 1,838 37,174 37,174 287,174 36,421 286,421
25 60 1,838 47,271 47,271 297,271 45,869 295,869
30 65 1,838 52,255 52,255 302,255 49,722 299,722
35 70 1,838 50,178 50,178 300,178 39,140 289,140
40 75 1,838 40,310 40,310 290,310 -- --
45 80 1,838 10,361 10,361 260,361 -- --
50 85 1,838 -- -- -- -- --
</TABLE>

THE HYPOTHETICAL INVESTMENT RATES OF RETURN SHOWN ABOVE AND ELSEWHERE IN THIS
PROSPECTUS ARE ILLUSTRATIVE ONLY AND SHOULD NOT BE DEEMED A REPRESENTATION OF
PAST OR FUTURE INVESTMENT RATES OF RETURN. ACTUAL INVESTMENT RATES OF RETURN MAY
BE MORE OR LESS THAN THOSE SHOWN AND DEPEND ON A NUMBER OF FACTORS, INCLUDING
THE INVESTMENT ALLOCATIONS BY AN OWNER AND THE DIFFERENT INVESTMENT RATE OF
RETURN FOR THE FUND PORTFOLIOS. THE DEATH BENEFIT AND ACCOUNT VALUE FOR A POLICY
WOULD BE DIFFERENT FROM THOSE SHOWN IF THE ACTUAL INVESTMENT RATE OF RETURN
AVERAGED 8% OVER A PERIOD OF YEARS, BUT FLUCTUATED ABOVE OR BELOW THOSE AVERAGES
FOR INDIVIDUAL POLICY YEARS. NO REPRESENTATION CAN BE MADE BY ANLIC OR THE FUNDS
THAT THIS HYPOTHETICAL INVESTMENT RATE OF RETURN CAN BE ACHIEVED FOR ANY ONE
YEAR OR OVER A PERIOD OF TIME.

ALLOCATOR 2000
A- 6
<PAGE> 85

ACACIA NATIONAL LIFE INSURANCE COMPANY

ALLOCATOR 2000 FLEXIBLE PREMIUM VARIABLE LIFE

Prepared for: Valued Client Annual Premium: $ 1,838

Male Age 35 Non-Tobacco Riders: None Option B Face Amount $250,000

<TABLE>
<CAPTION>
0.00% HYPOTHETICAL GROSS ANNUAL RATE OF RETURN
CURRENT CHARGES GUARANTEED CHARGES
----------------------------- -------------------
END OF NET ANNUAL ACCOUNT SURRENDER DEATH SURRENDER DEATH
YEAR AGE OUTLAY VALUE VALUE BENEFIT VALUE BENEFIT
- ------ --- ---------- ------- --------- ------- --------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
1 36 1,838 1,027 475 251,027 475 251,027
2 37 1,838 2,241 1,690 252,241 1,677 252,228
3 38 1,838 3,404 2,852 253,404 2,828 253,379
4 39 1,838 4,513 3,962 254,513 3,926 254,477
5 40 1,838 5,571 5,020 255,571 4,969 255,521
6 41 1,838 6,568 6,016 256,568 5,952 256,503
7 42 1,838 7,502 6,951 257,502 6,873 257,424
8 43 1,838 8,375 8,008 258,375 7,914 258,281
9 44 1,838 9,181 8,997 259,181 8,888 259,072
10 45 1,838 9,918 9,918 259,918 9,791 259,791
11 46 1,838 10,580 10,580 260,580 10,433 260,433
12 47 1,838 11,161 11,161 261,161 10,994 260,994
13 48 1,838 11,660 11,660 261,660 11,472 261,472
14 49 1,838 12,071 12,071 262,071 11,859 261,859
15 50 1,838 12,388 12,388 262,388 12,151 262,151
16 51 1,838 12,608 12,608 262,608 12,343 262,343
17 52 1,838 12,717 12,717 262,717 12,422 262,422
18 53 1,838 12,701 12,701 262,701 12,373 262,373
19 54 1,838 12,543 12,543 262,543 12,179 262,179
20 55 1,838 12,229 12,229 262,229 11,823 261,823
25 60 1,838 7,738 7,738 257,738 7,057 257,057
30 65 1,838 -- -- 250,000 -- 250,000
35 70 1,838 -- -- -- -- --
</TABLE>

THE HYPOTHETICAL INVESTMENT RATES OF RETURN SHOWN ABOVE AND ELSEWHERE IN THIS
PROSPECTUS ARE ILLUSTRATIVE ONLY AND SHOULD NOT BE DEEMED A REPRESENTATION OF
PAST OR FUTURE INVESTMENT RATES OF RETURN. ACTUAL INVESTMENT RATES OF RETURN MAY
BE MORE OR LESS THAN THOSE SHOWN AND DEPEND ON A NUMBER OF FACTORS, INCLUDING
THE INVESTMENT ALLOCATIONS BY AN OWNER AND THE DIFFERENT INVESTMENT RATE OF
RETURN FOR THE FUND PORTFOLIOS. THE DEATH BENEFIT AND ACCOUNT VALUE FOR A POLICY
WOULD BE DIFFERENT FROM THOSE SHOWN IF THE ACTUAL INVESTMENT RATE OF RETURN
AVERAGED 0% OVER A PERIOD OF YEARS, BUT FLUCTUATED ABOVE OR BELOW THOSE AVERAGES
FOR INDIVIDUAL POLICY YEARS. NO REPRESENTATION CAN BE MADE BY ANLIC OR THE FUNDS
THAT THIS HYPOTHETICAL INVESTMENT RATE OF RETURN CAN BE ACHIEVED FOR ANY ONE
YEAR OR OVER A PERIOD OF TIME.

ALLOCATOR 2000
A- 7
<PAGE> 86

APPENDIX B

AUTOMATIC REBALANCING, MODEL ASSET ALLOCATION AND DOLLAR COST
AVERAGING PROGRAMS

To assist the Owner in making a premium allocation decision among
Sub-accounts, ANLIC offers automatic transfer programs. These programs are
designed to meet individual needs of the Owner and are not guaranteed to improve
performance of the Policy.

The Owner may elect the Automatic Rebalancing Program which will adjust
values in the Sub-accounts to align with a specific percentage of total value in
the Variable Account. By placing a written allocation election form on file with
ANLIC, the Owner may have amounts automatically transferred from the
Sub-accounts on either a quarterly, semi-annual or annual basis. The Owner
chooses the percentages to be used under the Automatic Rebalancing Program.

Model Asset Allocation is offered through The Advisors Group, Inc. (TAG) in
conjunction with the services of Ibbotson Associates who were among the first to
develop the modern science of asset allocation. TAG representatives offer a
service created by Ibbotson Associates to match the Owner's risk tolerance and
investment objectives with a model Sub-account percentage allocation formula. To
use this service, the Owner first completes a questionnaire about risk tolerance
and Policy performance objectives. The TAG representative uses the completed
responses to match the Owner's needs to one of ten different model percentage
allocation formulas designed by Ibbotson. The Owner may then elect to follow the
recommended percentage allocation formula, or select a different formula.

Ibbotson Associates provides a valuable service to an Owner who seeks to
follow the science of asset allocation. Some research studies have shown that
the asset allocation decision is the single largest determinant of Portfolio
performance. Asset allocation combines the concepts of asset-liability
management, mean-variance optimization, simulation and economic forecasting. Its
objectives are to match asset classes and strategies to achieve better returns,
to reduce volatility and to attain specific goals such as avoidance of interest
rate or market risk.

As an alternative, ANLIC also offers the Owner the option to elect the
Dollar Cost Averaging Program. Dollar cost averaging is a long term investment
method that uses periodic premium allocations from the Money Market Sub-account
to other Sub-accounts. Under the theory of dollar cost averaging, the Owner may
pursue a strategy of regular and systematic purchases to take advantage of
market value fluctuations. More Sub-account accumulation units will be purchased
when Sub-account unit values are low and fewer units will be purchased when unit
values are high. There is no guarantee that the Dollar Cost Averaging Program
will protect against market loss or improve performance of the Policy.

The Dollar Cost Averaging Program provides a valuable service to an Owner
who is able to sustain a long term transfer schedule and who seeks to avoid the
volatility often associated with equity investments.

ALLOCATOR 2000
B- 1
<PAGE> 87
INCORPORATION BY REFERENCE

The Registrant, Separate Account I, purchases or will purchase units from the
portfolios of these Funds at the direction of its Policy Owners. The
prospectuses of these Funds will be distributed with this prospectus and are
hereby incorporated by reference. The prospectuses incorporated by reference are
as follows:

The Alger American Fund
SEC File No. 33-21722

Calvert Variable Series, Inc.
SEC File No. 2-80154

Deutsche Asset Management VIT Funds
SEC File No. 333-00479

Variable Insurance Products Fund
SEC File No. 2-75010
Variable Insurance Products Fund II
SEC File No. 33-20773

Franklin Templeton Variable Insurance Products Trust
SEC File No. 33-23493

Neuberger Berman Advisers Management Trust
SEC File No. 2-88566

Oppenheimer Variable Account Funds
SEC File No. 2-931-77

Van Eck Worldwide Insurance Trust
SEC File No. 33-13019

<PAGE> 88

UNDERTAKING TO FILE REPORTS

Subject to the terms and conditions of Section 15(d) of the Securities Exchange
Act of 1934, the undersigned registrant hereby undertakes to file with the
Securities and Exchange Commission such supplementary and periodic information,
documents, and reports as may be prescribed by any rule or regulation of the
Commission heretofore, or hereafter duly adopted pursuant to authority conferred
in that section.

Registrant makes the following representation pursuant to the National
Securities Markets Improvements Act of 1996:

Acacia National Life Insurance Company represents that the fees and charges
deducted under the contract, in the aggregate, are reasonable in relation to the
services rendered, the expenses expected to be incurred, and the risks assumed
by the insurance company.

RULE 484 UNDERTAKING

ANLIC'S By-laws provide as follows:

In the event any action, suit or proceeding is brought against a present or
former Director, elected officer, appointed officer or other employee because of
any action taken by such person as a Director, officer or other employee of the
Company or which he omitted to take as a Director, officer or employee of the
Company, the Company shall reimburse or indemnify him for all loss reasonably
incurred by him in connection with such action to the fullest extent permitted
by ss.13.1-696 through ss.13.1-704 of the Code of Virginia, as is now or
hereafter amended, except in relation to matters as to which such person shall
have been finally adjudged to be liable by reason of having been guilty of gross
negligence or willful misconduct in the performance of duties as such Director,
officer or employee. In case any such suit, action or proceeding shall result in
a settlement prior to final judgment and if, in the judgment of the Board of
Directors, such person in taking the action or failing to take the action
complained of was not grossly negligent or guilty of wilful misconduct in the
performance of his duty, the Company shall reimburse or indemnify him for the
amount of such settlement and for all expenses reasonably incurred in connection
with such action and its settlement. This right of indemnification shall not be
exclusive of any other rights to which such person may be entitled.

REPRESENTATION PURSUANT TO RULE 6E-3(T)

This filing is made pursuant to Rules 6c-3 and 6e-3(T) under the Investment
Company Act of 1940.

<PAGE> 89

PART II
CONTENTS OF REGISTRATION STATEMENT

This Registration Statement comprises the following Papers and Documents:
The facing sheet.
The prospectus consisting of 82 pages.
The undertaking to file reports.
The undertaking pursuant to Rule 484.
Representations pursuant to Rule 6e-3(T).
The signatures.

The Following Exhibits:
1. The Following exhibits correspond to those required by paragraph IX A of the
instructions as to exhibits in Form N-8B-2. (A)(1) Board Resolution Establishing
Separate Account I-Incorporated by reference to the like numbered exhibit to the
Pre-effective Amendment #3 filed on October 11, 1995 to the Form S-6
Registration #33-90208.
(A)(2) Not applicable
(A)(3)(a) Underwriting Agreement
between The Advisors Group, Inc. and Acacia National Life Insurance Company -
Incorporated by reference to the initial Registration Statement for Acacia
National Life Insurance Company Separate Account II on Form N-4 ( File No 333
- -03963), August 26, 1996.
(A)(3)(b) Representative Agent Agreement, Supplement and Schedule proposed form
of Selling Agreement Incorporated by reference to the initial Registration
Statement for Acacia National Life Insurance Company Separate Account II on
Form N-4 ( File No 333 -03963), Filed August 26, 1996.
(A)(3)(c) None
(A)(3)(d) Form of Selling Agreement between the Advisors Group, Inc. ('TAG") and
Broker Dealers - Incorporated by reference to the like numbered to the initial
Form S-6 Registration Statement #33-90208, filed March 10, 1995.
(A)(4) Not Applicable
(A)(5)(a) Individual Flexible Premium Variable Life Insurance Policy -
Incorporated by reference to the like numbered exhibit to the Pre-Effective
Amendment #3 filed on October 11, 1995 to the Form S-6 Registration Statement #
33-90208.
(A)(6) Restated Articles of Incorporation of Acacia National Life Insurance
Company - Incorporated by reference to the like numbered exhibit to the
Post-Effective Amendment #3 filed on May 1, 1997 to the Form S-6 Registration
Statement # 33-90208. (A)(6) Bylaws of Acacia National Life Insurance Company -
Incorporated by reference to the like numbered exhibit to the Post-Effective
Amendment #3 filed on May 1, 1997 to the Form S-6 Registration Statement #
33-90208.
(A)(7) Not applicable (A)(8)(a) Participation Agreement Alger American Fund
(A)(8)(b) Participation Agreement Calvert Variable Series, Inc.
(A)(8)(d) Participation Agreement Neuberger Berman Advisers Management Trust
(A)(8)(f) Participation Agreement Van Eck Worldwide Hard Assets Fund
All incorporated by reference to the like numbered exhibit to the Pre-Effective
Amendment #3 filed on October 11, 1995 to the Form S-6 Registration Statement #
33-90208.
(A)(8)(g) Participation Agreement Oppenheimer Variable Account Funds -
Incorporated by reference to the like numbered exhibit to the Post-Effective
Amendment #3 filed on May 1, 1997 to the Form S-6 Registration Statement #
33-90208.
(A)(8)(h) Participation Agreement - Deutsche Asset Management VIT Funds
(A)(8)(i) Participation Agreement - Franklin Templeton Variable Insurance
Products Trust Incorporated by reference to the like named exhibit to the
Post-Effective Amendment #1 filed on February 25, 2000 to the Form S-6
Registration Statement # 333-81057.
(A)(8)(j) Participation Agreement - Variable Insurance Products Fund
(A)(8)(k) Participation Agreement - Variable Insurance Products Fund II
Incorporated by reference to the like named exhibit to the Pre-Effective
Amendment #1 filed on April 27, 2000 to the Form S-6 Registration Statement #
333-95593.
(A)(9) Not Applicable
(A)(10) Application for Policy - Incorporated by reference to the like numbered
exhibit to the Pre-effective Amendment#2 filed on July 19,1995 to the Form S-6
Registration Statement #33-90208.

2. (a)(b) Opinion and Consent of Robert-John H. Sands.
3. No financial statements will be omitted from the final Prospectus pursuant to
Instruction 1(b) or (c) or Part I. 4. Not applicable.
5. Not applicable.

6. Consent of Russell J. Wiltgen.

7. Consent of Independent Auditors.
8. Not applicable.

<PAGE> 90

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the Registrant,
Acacia National Life Insurance Company Separate Account I, certifies that it
meets all the requirements for effectiveness of this Post-Effective Amendment
No. 8 to the Registration Statement pursuant to Rule 485(b) under the Securities
Act of 1933 and has caused this Amendment to the Registration Statement to be
signed on its behalf by the undersigned thereunto duly authorized in the City of
Bethesda, County of Montgomery, State of Maryland on this 26th day of April,
2000.

ACACIA NATIONAL VARIABLE LIFE SEPARATE ACCOUNT I, Registrant
ACACIA NATIONAL LIFE INSURANCE COMPANY, Depositor

Attest:/s/ Robert-John H. Sands By: /s/ Charles T. Nason
------------------------------- -------------------------------
Secretary Chairman of the Board

Pursuant to the requirements of the Securities Act of 1933, this Registration
Statement has been signed by the Directors and Principal Officers of Acacia
National Life Insurance Company on the dates indicated.

<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----

<S> <C> <C>
/s/ Charles T. Nason
- ------------------------- Chairman of the Board April 26, 2000
Charles T. Nason and Chief Executive Officer
and Director

/s/ Robert W. Clyde
- ------------------------- President and Chief April 26, 2000
Robert W. Clyde Operating Officer and
Director

/s/ Robert-John H. Sands
- ------------------------- Senior Vice President, April 26, 2000
Robert-John H. Sands General Counsel, Corporate
Secretary and Director

/s/ Haluk Ariturk
- ------------------------- Senior Vice President, April 26, 2000
Haluk Ariturk Product Management and
Administration and Director

/s/ JoAnn M. Martin
- ------------------------- Senior Vice President, April 26, 2000
JoAnn M. Martin Chief Financial Officer
and Director

/s/ Reno J. Martini
- ------------------------- Director April 26, 2000
Reno J. Martini

</TABLE>

<PAGE> 91

<TABLE>

<S> <C> <C>
/s/ Brian J. Owens
- ------------------------- Senior Vice President, April 26, 2000
Brian J. Owens Career Distribution

/s/ Janet L. Schmidt
- ------------------------- Senior Vice President April 26, 2000
Janet L. Schmidt Human Resources

/s/ Barry C. Ritter
- ------------------------- Senior Vice President April 26, 2000
Barry C. Ritter and Chief Information Officer

/s/ Richard W. Vautravers
- ------------------------- Senior Vice President April 26, 2000
Richard W. Vautravers and Corporate Actuary

</TABLE>

<PAGE> 92

EXHIBIT INDEX

EXHIBIT

2. (a)(b) Opinion and Consent of Robert-John H. Sands

7. (a)(b) Opinion and Consent of Russell J. Wiltgen

8. (a) Consent of Deloitte & Touche LLP

8. (b) Consent of PricewaterhouseCoopers LLP

<PAGE> 1

EXHIBIT 2. (a)(b)

Opinion and Consent of Robert-John H. Sands

<PAGE> 2

April 27, 2000

Acacia National Life Insurance Company
7315 Wisconsin Avenue
Bethesda, MD 20814

Gentlemen:

With reference to the Post-Effective Amendment No. 8 to Registration Statement
33-90208 on Form S-6 filed by Acacia National Life Insurance Company and Acacia
National Variable Life Insurance Separate Account I with the Securities and
Exchange Commission covering flexible premium life insurance policies,
I have examined such documents and such laws as I considered necessary and
appropriate, and on the basis of such examination, it is my opinion that:

1. Acacia National Life Insurance Company is duly organized and validly
existing under the laws of the Commonwealth of Virginia and has been
duly authorized to issue individual flexible premium variable life
policies by the Bureau of Insurance, State Corporation Commission
of the Commonwealth of Virginia.

2. Acacia National Variable Life Insurance Separate Account I is a duly
authorized and existing separate account established pursuant to the
provisions of Virginia, ss.38.2-3113.

3. The flexible premium variable universal life policies,
when issued as contemplated by said Form S-6 Registration Statement,
will constitute legal, validly issued and binding obligations of Acacia
National Life Insurance Company.

I hereby consent to the filing of this opinion as an exhibit to the
Post-Effective Amendment No. 8 to said Form S-6 Registration Statement and to
the use of my name under the caption "Legal Matters" in the Prospectus contained
in the Registration Statement.

Sincerely,

/s/ Robert-John H. Sands
Robert-John H. Sands
Senior Vice President, Corporate Secretary and
General Counsel

<PAGE> 1
EXHIBIT 7. (a)(b)

Opinion and Consent of Russell J. Wiltgen
<PAGE> 2

April 27, 2000

Acacia National Life Insurance Company
7315 Wisconsin Avenue
Bethesda, MD 20814

Gentlemen:

This opinion is furnished in connection with the registration by Acacia National
Life Insurance Company, of a flexible premium variable universal life insurance
policy ("Contract") under the Securities Act of 1933. The prospectus included in
Post-Effective Amendment No. 8 to Registration Statement No. 33-90208 on Form
S-6 describes the Contract. The form of Contract was prepared under my direction
and I am familiar with the Registration Statement and Exhibits thereto. This
contract was developed and filed under Securities and Exchange Commission Rule
6E- 3(T), as interpreted at this time by the SEC staff. In my opinion:

The illustrations of death benefits and accumulation values included in the
section entitled "Illustrations of Death Benefits and Accumulation Values" in
the Appendices of the prospectus, based on the assumptions stated in the
illustrations, are consistent with the provisions of the Contract. The rate
structure of the Contract has not been designed so as to make the
relationship between premiums and benefits, as shown in the illustrations,
appear more favorable to prospective purchasers of the Contract for a male
age 35, than to prospective purchasers of the Contract for other ages or for
females.

I hereby consent to the use of this opinion as an exhibit to the Post-Effective
Amendment No. 8 to the Registration Statement and to the reference to my name
under the heading "Experts" in the prospectus.

Sincerely,

/s/ Russell J. Wiltgen
Russell J. Wiltgen
Vice President - Individual Product Management

<PAGE> 1
EXHIBIT 8. (a)

Consent of Deloitte & Touche LLP

<PAGE> 2
EXHIBIT 99.8(a)

INDEPENDENT AUDITORS' CONSENT

We consent to the use in this Post-Effective Amendment No. 8 to Registration
Statement No. 33-90208 of Acacia National Variable Life Insurance Separate
Account I of our reports dated April 7, 2000, on the statutory basis financial
statements of Acacia National Life Insurance Company and the financial
statements of the subaccounts of Acacia National Variable Life Insurance
Separate Account I appearing in the Prospectus, which is a part of such
Registration Statement, and to the reference to us under the heading "Experts"
in such Prospectus.

/s/ Deloitte & Touche LLP

Lincoln, Nebraska
April 21, 2000

<PAGE> 1
[PRICEWATERHOUSECOOPERS LOGO]

CONSENT OF INDEPENDENT ACCOUNTANTS

We hereby consent to the use in this Registration Statement on Form S-6
(Registration No. 33-90208) of our report dated March 31, 1999, on the
financial statements (statutory basis) of Acacia National Life Insurance
Company and our report dated April 30, 1999 on the financial statements of
Acacia National Variable Life Insurance Separate Account I, which appear in
such Registration Statement. We also consent to the reference to us under the
caption "Experts".

/s/ PricewaterhouseCoopers LLP
PricewaterhouseCoopers LLP

Washington, D.C.
April 21, 2000