AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                                                                                     One Corporate Drive, Shelton, Connecticut 06484

This Prospectus  describes  StagecoachTM Advisor PlanSM III, a flexible premium deferred annuity (the "Annuity") offered by American
Skandia Life  Assurance  Corporation  ("American  Skandia",  "we",  "our" or "us")  exclusively  through Wells Fargo Bank,  N.A. The
Annuity may be offered as an  individual  annuity  contract or as an interest in a group  annuity.  This  Prospectus  describes  the
important  features of the Annuity and what you should  consider  before  purchasing the Annuity.  We have also filed a Statement of
Additional  Information  that is available from us, without charge,  upon your request.  The contents of the Statement of Additional
Information  are  described on page 73. The Annuity or certain of its  investment  options  and/or  features may not be available in
all states.  Various rights and benefits may differ between states to meet  applicable  laws and/or  regulations.  Certain terms are
capitalized  in this  Prospectus.  Those  terms are either  defined in the  Glossary  of Terms or in the  context of the  particular
section.

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American  Skandia offers several  different  annuities  which your investment  professional  may be authorized to offer to you. Each
annuity has different  features and benefits that may be  appropriate  for you based on your financial  situation,  your age and how
you intend to use the annuity.  The different features and benefits include variations in death benefit  protection,  the ability to
access your  annuity's  account value and the charges that you will be subject to if you choose to surrender  the annuity.  The fees
and charges may also be different between each annuity.
====================================================================================================================================

If you are purchasing the Annuity as a replacement  for existing  variable  annuity or variable life coverage,  you should  consider
any  surrender or penalty  charges you may incur when  replacing  your  existing  coverage and that this Annuity may be subject to a
contingent  deferred  sales charge if you elect to surrender  the Annuity or take a partial  withdrawal.  You should  consider  your
need to access the Annuity's Account Value and whether the annuity's liquidity features will satisfy that need.

WHY WOULD I CHOOSE TO PURCHASE THIS ANNUITY?
This Annuity is frequently  used for  retirement  planning  because it allows you to accumulate  retirement  savings and also offers
annuity payment options when you are ready to begin  receiving  income.  The Annuity also offers one or more death benefits that can
protect  your  retirement  savings if you die during a period of  declining  markets.  It may be used as an  investment  vehicle for
"qualified"  investments,  including an IRA,  SEP-IRA,  Roth IRA or Tax  Sheltered  Annuity (or  403(b)).  It may also be used as an
investment  vehicle  for  "non-qualified"  investments.  The  Annuity  allows  you to  invest  your  money in a number  of  variable
investment options as well as in one or more fixed investment options.

When an Annuity is purchased as a  "non-qualified"  investment,  you  generally  are not taxed on any  investment  gains the Annuity
earns until you make a  withdrawal  or begin to receive  annuity  payments.  This  feature,  referred to as  "tax-deferral",  can be
beneficial to the growth of your Account Value  because money that would  otherwise be needed to pay taxes on investment  gains each
year remains invested and can earn additional money.  However,  because the Annuity is designed for long-term  retirement savings, a
10%  penalty  tax may be  applied  on  withdrawals  you make  before  you  reach age 59 1/2.  Annuities  purchased  as a  non-qualified
investment  are not subject to the maximum  contribution  limits  that may apply to a qualified  investment,  and are not subject to
required minimum distributions after age 701/2.

When an Annuity is purchased as a "qualified"  investment,  you should consider that the Annuity does not provide any tax advantages
in addition to the  preferential  treatment  already  available  through your  retirement  plan under the Internal  Revenue Code. An
Annuity may offer  features  and  benefits in addition to  providing  tax  deferral  that other  investment  vehicles may not offer,
including  death benefit  protection for your  beneficiaries,  lifetime income  options,  and the ability to make transfers  between
numerous  variable  investment  options  offered  under the Annuity.  You should  consult with your  investment  professional  as to
whether the overall benefits and costs of the Annuity are appropriate considering your overall financial plan.

These  annuities are NOT deposits or  obligations  of, or issued,  guaranteed or endorsed by, any bank, or bank  subsidiary of Wells
Fargo Bank,  N.A., are NOT insured or guaranteed by the U.S.  government,  the Federal Deposit  Insurance  Corporation  (FDIC),  the
Federal Reserve Board or any other agency.  An investment in this annuity  involves  investment  risks,  including  possible loss of
value.
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THESE  SECURITIES  HAVE NOT BEEN  APPROVED  OR  DISAPPROVED  BY THE  SECURITIES  AND  EXCHANGE  COMMISSION  OR ANY STATE  SECURITIES
COMMISSION NOR HAS THE COMMISSION OR ANY STATE SECURITIES  COMMISSION  PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS.  ANY
REPRESENTATION  TO THE CONTRARY IS A CRIMINAL  OFFENSE.  PLEASE READ THIS  PROSPECTUS AND THE CURRENT  PROSPECTUS FOR THE UNDERLYING
MUTUAL FUNDS.  KEEP THEM FOR FUTURE REFERENCE.
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                                            FOR FURTHER INFORMATION CALL 1-800-680-8920.
Prospectus Dated: December 15, 2003                                     Statement of Additional Information Dated: December 15, 2003
WFVASAPIIIPROS - (12/2003)                                                                                              WFVASIIIPROS

                            PLEASE SEE OUR PRIVACY POLICY ATTACHED TO THE BACK COVER OF THIS PROSPECTUS.


WHAT ARE SOME OF THE KEY FEATURES OF THIS ANNUITY?

|X|      This Annuity is a "flexible  premium  deferred  annuity." It is called  "flexible  premium"  because you have  considerable
       flexibility in the timing and amount of premium  payments.  Generally,  investors  "defer"  receiving  annuity payments until
       after an accumulation period.

|X|      This  Annuity  offers  both  variable  and fixed  investment  options.  If you  allocate  your  Account  Value to  variable
       investment  options,  the value of your  Annuity  will vary daily to reflect the  investment  performance  of the  underlying
       investment  options.  Fixed investment  options of different  durations are offered that are guaranteed by us, but may have a
       Market Value Adjustment if you withdraw or transfer your Account Value before the Maturity Date.

|X|      The Annuity  features  two  distinct  periods - the  accumulation  period and the payout  period.  During the  accumulation
       period  your  Account  Value is  allocated  to one or more  investment  options.  The  variable  investment  options,  each a
       Sub-account  of  American  Skandia  Life  Assurance  Corporation  Variable  Account B,  invest in an  underlying  mutual fund
       portfolio.  Currently,  portfolios of the following  underlying  mutual funds are being offered:  Wells Fargo Variable Trust,
       American Skandia Trust,  Gartmore Variable  Investment Trust,  INVESCO Variable  Investment Funds,  Inc.,  Evergreen Variable
       Annuity Trust, ProFunds VP, First Defined Portfolio Fund LLC and The Prudential Series Fund, Inc.

|X|      During the payout period,  commonly called  "annuitization,"  you can elect to receive  annuity  payments (1) for life; (2)
       for life with a  guaranteed  minimum  number  of  payments;  (3)  based on joint  lives;  or (4) for a  guaranteed  number of
       payments.  We currently make annuity payments available on a fixed or variable basis.

|X|      This Annuity offers three different optional benefits,  for an additional  charge,  that can provide investment  protection
       for Owners while they are alive.

|X|      This Annuity  offers a basic Death  Benefit.  It also offers  optional  Death  Benefits  that provide an enhanced  level of
       protection for your beneficiary(ies) for an additional charge.

|X|      You are allowed to withdraw a limited  amount of money from your  Annuity on an annual  basis  without any  charges.  Other
       product  features  allow you to access your Account  Value as necessary,  although a charge may apply.  After Annuity Year 8,
       you are allowed to make unlimited withdrawals from your Annuity without any charges.

|X|      Transfers  between  investment  options are tax-free.  Currently,  you may make twenty  transfers each year free of charge.
       We also  offer  several  programs  that  enable you to manage  your  Account  Value as your  financial  needs and  investment
       performance change.

HOW DO I PURCHASE THIS ANNUITY?
We sell the Annuity through licensed,  registered  investment  professionals.  You must complete an application and submit a minimum
initial  purchase  payment of $1,000.  We may allow you to make a lower  initial  purchase  payment  provided  you  establish a bank
drafting  program under which purchase  payments  received in the first Annuity Year total at least $1,000.  If the Annuity is owned
by an individual or  individuals,  the oldest of those  persons must be age 80 or under.  If the Annuity is owned by an entity,  the
annuitant must be age 80 or under.




                                                         TABLE OF CONTENTS

GLOSSARY OF TERMS..................................................................................................................5
SUMMARY OF CONTRACT FEES AND CHARGES...............................................................................................6
EXPENSE EXAMPLES..................................................................................................................10
INVESTMENT OPTIONS................................................................................................................11
   WHAT ARE THE INVESTMENT OBJECTIVES AND POLICIES OF THE PORTFOLIOS?.............................................................11
   WHAT ARE THE FIXED INVESTMENT OPTIONS?.........................................................................................27
FEES AND CHARGES..................................................................................................................27
   WHAT ARE THE CONTRACT FEES AND CHARGES?........................................................................................27
   WHAT CHARGES APPLY SOLELY TO THE VARIABLE INVESTMENT OPTIONS?..................................................................28
   WHAT CHARGES ARE ASSESSED BY THE PORTFOLIOS?...................................................................................28
   WHAT CHARGES APPLY TO THE FIXED ALLOCATIONS?...................................................................................29
   WHAT CHARGES APPLY IF I CHOOSE AN ANNUITY PAYMENT OPTION?......................................................................29
   EXCEPTIONS/REDUCTIONS TO FEES AND CHARGES......................................................................................29
PURCHASING YOUR ANNUITY...........................................................................................................29
   WHAT ARE OUR REQUIREMENTS FOR PURCHASING THE ANNUITY?..........................................................................29
MANAGING YOUR ANNUITY.............................................................................................................30
   MAY I CHANGE THE OWNER, ANNUITANT AND BENEFICIARY DESIGNATIONS?................................................................30
   MAY I RETURN THE ANNUITY IF I CHANGE MY MIND?..................................................................................30
   MAY I MAKE ADDITIONAL PURCHASE PAYMENTS?.......................................................................................30
   MAY I MAKE SCHEDULED PAYMENTS DIRECTLY FROM MY BANK ACCOUNT?...................................................................30
   MAY I MAKE PURCHASE PAYMENTS THROUGH A SALARY REDUCTION PROGRAM?...............................................................31
MANAGING YOUR ACCOUNT VALUE.......................................................................................................31
   HOW AND WHEN ARE PURCHASE PAYMENTS INVESTED?...................................................................................31
   ARE THERE RESTRICTIONS OR CHARGES ON TRANSFERS BETWEEN INVESTMENT OPTIONS?.....................................................31
   DO YOU OFFER DOLLAR COST AVERAGING?............................................................................................32
   DO YOU OFFER ANY AUTOMATIC REBALANCING PROGRAMS?...............................................................................32
   DO YOU OFFER ANY ASSET ALLOCATION PROGRAMS?....................................................................................33
   DO YOU OFFER A PROGRAM DESIGNED TO GUARANTEE A "RETURN OF PREMIUM" AT A FUTURE DATE?...........................................33
   MAY I AUTHORIZE MY INVESTMENT PROFESSIONAL TO MANAGE MY ACCOUNT?...............................................................33
   HOW DO THE FIXED INVESTMENT OPTIONS WORK?......................................................................................34
   HOW DO YOU DETERMINE RATES FOR FIXED ALLOCATIONS?..............................................................................34
   HOW DOES THE MARKET VALUE ADJUSTMENT WORK?.....................................................................................35
   WHAT HAPPENS WHEN MY GUARANTEE PERIOD MATURES?.................................................................................36
ACCESS TO ACCOUNT VALUE...........................................................................................................36
   WHAT TYPES OF DISTRIBUTIONS ARE AVAILABLE TO ME?...............................................................................36
   ARE THERE TAX IMPLICATIONS FOR DISTRIBUTIONS?..................................................................................36
   CAN I WITHDRAW A PORTION OF MY ANNUITY?........................................................................................37
   HOW MUCH CAN I WITHDRAW AS A FREE WITHDRAWAL?..................................................................................37
   IS THERE A CHARGE FOR A PARTIAL WITHDRAWAL?....................................................................................38
   CAN I MAKE PERIODIC WITHDRAWALS FROM THE ANNUITY DURING THE ACCUMULATION PERIOD?...............................................38
   DO YOU OFFER A PROGRAM FOR WITHDRAWALS UNDER SECTION 72(t) OF THE INTERNAL REVENUE CODE?.......................................38
   WHAT ARE MINIMUM DISTRIBUTIONS AND WHEN WOULD I NEED TO MAKE THEM?.............................................................39
   CAN I SURRENDER MY ANNUITY FOR ITS VALUE?......................................................................................39
   WHAT IS A MEDICALLY-RELATED SURRENDER AND HOW DO I QUALIFY?....................................................................39
   WHAT TYPES OF ANNUITY OPTIONS ARE AVAILABLE?...................................................................................40
   HOW AND WHEN DO I CHOOSE THE ANNUITY PAYMENT OPTION?...........................................................................41
   HOW ARE ANNUITY PAYMENTS CALCULATED?...........................................................................................41
LIVING BENEFIT PROGRAMS...........................................................................................................42
   DO YOU OFFER PROGRAMS DESIGNED TO PROVIDE INVESTMENT PROTECTION FOR OWNERS WHILE THEY ARE ALIVE?...............................42
   GUARANTEED RETURN OPTION PlusSM (GRO PlusSM)...................................................................................43
   GUARANTEED MINIMUM WITHDRAWAL BENEFIT (GMWB)...................................................................................48
   GUARANTEED MINIMUM INCOME BENEFIT (GMIB).......................................................................................52
DEATH BENEFIT.....................................................................................................................56
   WHAT TRIGGERS THE PAYMENT OF A DEATH BENEFIT?..................................................................................56
   Basic Death Benefit............................................................................................................56
   OPTIONAL DEATH BENEFITS........................................................................................................56
   AMERICAN SKANDIA'S ANNUITY REWARDS.............................................................................................58
   PAYMENT OF DEATH BENEFITS......................................................................................................59
VALUING YOUR INVESTMENT...........................................................................................................60
   HOW IS MY ACCOUNT VALUE DETERMINED?............................................................................................60
   WHAT IS THE SURRENDER VALUE OF MY ANNUITY?.....................................................................................60
   HOW AND WHEN DO YOU VALUE THE SUB-ACCOUNTS?....................................................................................60
   HOW DO YOU VALUE FIXED ALLOCATIONS?............................................................................................61
   WHEN DO YOU PROCESS AND VALUE TRANSACTIONS?....................................................................................61
   WHAT HAPPENS TO MY UNITS WHEN THERE IS A CHANGE IN DAILY ASSET-BASED CHARGES?..................................................62
TAX CONSIDERATIONS................................................................................................................62
   WHAT ARE SOME OF THE FEDERAL TAX CONSIDERATIONS OF THIS ANNUITY?...............................................................62
   HOW ARE AMERICAN SKANDIA AND THE SEPARATE ACCOUNTS TAXED?......................................................................62
   IN GENERAL, HOW ARE ANNUITIES TAXED?...........................................................................................62
   HOW ARE DISTRIBUTIONS TAXED?...................................................................................................63
   WHAT TAX CONSIDERATIONS ARE THERE FOR TAX-QUALIFIED RETIREMENT PLANS OR QUALIFIED
     CONTRACTS?...................................................................................................................64
   HOW ARE DISTRIBUTIONS FROM QUALIFIED CONTRACTS TAXED?..........................................................................65
   GENERAL TAX CONSIDERATIONS.....................................................................................................66
GENERAL INFORMATION...............................................................................................................67
   HOW WILL I RECEIVE STATEMENTS AND REPORTS?.....................................................................................67
   WHO IS AMERICAN SKANDIA?.......................................................................................................68
   WHAT ARE SEPARATE ACCOUNTS?....................................................................................................68
   WHAT IS THE LEGAL STRUCTURE OF THE UNDERLYING FUNDS?...........................................................................69
   WHO DISTRIBUTES ANNUITIES OFFERED BY AMERICAN SKANDIA?.........................................................................70
   AVAILABLE INFORMATION..........................................................................................................72
   INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE................................................................................72
   HOW TO CONTACT US..............................................................................................................72
   INDEMNIFICATION................................................................................................................73
   LEGAL PROCEEDINGS..............................................................................................................73
   CONTENTS OF THE STATEMENT OF ADDITIONAL INFORMATION............................................................................73
APPENDIX A - FINANCIAL INFORMATION ABOUT AMERICAN SKANDIA..........................................................................1
AUDITED CONSOLIDATED FINANCIAL STATEMENTS OF AMERICAN SKANDIA LIFE ASSURANCE CORPORATION..........................................11
APPENDIX B - CONDENSED FINANCIAL INFORMATION ABOUT SEPARATE ACCOUNT B..............................................................1
APPENDIX C - CALCULATION OF OPTIONAL DEATH BENEFITS................................................................................1




                                                         GLOSSARY OF TERMS

Many terms used within this  Prospectus  are described  within the text where they appear.  The  description  of those terms are not
repeated in this Glossary of Terms.

Account Value:  The value of each  allocation to a Sub-account or a Fixed  Allocation  prior to the Annuity Date, plus any earnings,
and/or less any losses,  distributions  and charges.  The Account Value is  calculated  before we assess any  applicable  Contingent
Deferred Sales Charge ("CDSC") and/or any Annual  Maintenance  Fee. The Account Value is determined  separately for each Sub-account
and for each Fixed  Allocation,  and then totaled to determine the Account Value for your entire Annuity.  The Account Value of each
Fixed Allocation on other than its Maturity Date may be calculated using a market value adjustment.

Annuitization:  The  application  of Account Value to one of the  available  annuity  options for the  Annuitant to begin  receiving
periodic payments for life, for a guaranteed minimum number of payments or for life with a guaranteed minimum number of payments.

Annuity Date: The date you choose for annuity payments to commence.  A maximum Annuity Date may apply.

Annuity Year: A 12-month period commencing on the Issue Date of the Annuity and each successive 12-month period thereafter.

Code: The Internal Revenue Code of 1986, as amended from time to time.

Fixed  Allocation:  An allocation of Account Value that is to be credited a fixed rate of interest for a specified  Guarantee Period
during the accumulation period.

Guarantee Period: A period of time during the accumulation period where we credit a fixed rate of interest on a Fixed Allocation.

Interim  Value:  The value of a Fixed  Allocation  on any date other  than the  Maturity  Date.  The  Interim  Value is equal to the
initial value allocated to the Fixed Allocation plus all interest  credited to the Fixed Allocation as of the date calculated,  less
any transfers or withdrawals from the Fixed Allocation.

Issue Date: The effective date of your Annuity.

MVA: A market value  adjustment  used in the  determination  of Account  Value of each Fixed  Allocation  on a day more than 30 days
prior to the Maturity Date of such Fixed Allocation.

Owner: With an Annuity issued as an individual  annuity  contract,  the Owner is either an eligible entity or person named as having
ownership rights in relation to the Annuity.  With an Annuity issued as a certificate  under a group annuity  contract,  the "Owner"
refers to the person or entity who has the rights and benefits designated as to the "Participant" in the certificate.

Surrender  Value:  The value of your Annuity  available upon surrender  prior to the Annuity Date. It equals the Account Value as of
the date we price the  surrender  minus any  applicable  CDSC,  Annual  Maintenance  Fee, Tax Charge and the charge for any optional
benefits.

Unit:  A measure used to calculate your Account Value in a Sub-account during the accumulation period.

Valuation Day:  Every day the New York Stock  Exchange is open for trading or any other day the  Securities and Exchange  Commission
requires mutual funds or unit investment trusts to be valued.

SUMMARY OF CONTRACT FEES AND CHARGES

Below is a summary of the fees and charges for the  Annuity.  Some fees and charges are assessed  against your Annuity  while others
are assessed  against  assets  allocated  to the variable  investment  options.  The fees and charges that are assessed  against the
Annuity  include the  Contingent  Deferred  Sales Charge,  Transfer Fee, and Annual  Maintenance  Fee. The charges that are assessed
against the variable  investment options are the Insurance Charge,  which is the combination of a mortality and expense risk charge,
a charge for  administration  of the  Annuity,  the  Distribution  Charge and the charge for any optional  benefits you elect.  Each
underlying  mutual fund portfolio  assesses a charge for investment  management,  other expenses and with some mutual funds, a 12b-1
charge.  The prospectus for each  underlying  mutual fund provides more detailed  information  about the expenses for the underlying
mutual  funds.  Tax charges may vary by state and in certain  states a premium tax charge may be  applicable.  All of these fees and
charges are described in more detail within this Prospectus.

The  following  table  provides a summary of the fees and charges you will incur if you  surrender  the Annuity or transfer  Account
Value among investment options.  These fees and charges are described in more detail within this Prospectus.

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                                                   YOUR TRANSACTION FEES AND CHARGES
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                                                    (assessed against the Annuity)
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                             FEE/CHARGE                                                        Amount Deducted
- --------------------------------------------------------------------- ------------------------------------------------------------------
- ---------------------------------------------------------------------
Contingent Deferred Sales Charge*                                                                   7.5%
                                                                       The charge is a percentage of each applicable Purchase Payment
                                                                        deducted upon surrender or withdrawal. The period is measured
                                                                                     from the Issue Date of the Annuity.
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Transfer Fee                                                                                       $10.00
                                                                            (Deducted after the 20th transfer each Annuity Year)
- --------------------------------------------------------------------- ------------------------------------------------------------------

*    The following are the Contingent Deferred Sales Charges (as a percentage of each applicable Purchase Payment) upon surrender
or withdrawal.

                                       ------- ------ ------ ------ ----- ------ ------ ----- -------
                                       Yr. 1   Yr. 2  Yr. 3  Yr. 4  Yr.   Yr. 6  Yr. 7  Yr.   Yr. 9+
                                                                     5                   8
                                       ------- ------ ------ ------ ----- ------ ------ ----- -------
                                       ------- ------ ------ ------ ----- ------ ------ ----- -------
                                        7.5%   7.0%   6.5%   6.0%   5.0%  4.0%   3.0%   2.0%   0.0%
                                       ------- ------ ------ ------ ----- ------ ------ ----- -------

The  following  table  provides a summary of the periodic  fees and charges you will incur while you own the Annuity,  excluding the
underlying mutual fund Portfolio annual expenses.  These fees and charges are described in more detail within this Prospectus.

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                                                    YOUR PERIODIC FEES AND CHARGES
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- ---------------------------------------------- -------------------------------------------- --------------------------------------------
                                                            AMOUNT DEDUCTED/
                 FEE/EXPENSE                              DESCRIPTION OF CHARGE                            WHEN DEDUCTED
- ---------------------------------------------- -------------------------------------------- --------------------------------------------
- ---------------------------------------------- -------------------------------------------- --------------------------------------------
Premium Tax Charge                                 Depends on the requirements of the                         Various
                                                         applicable jurisdiction

============================================== ============================================ ============================================
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                                           ANNUAL FEES/CHARGES ASSESSED AGAINST THE ANNUITY
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                             FEE/CHARGE                                                        Amount Deducted
- --------------------------------------------------------------------- ------------------------------------------------------------------
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Annual Maintenance Fee                                                              Smaller of $35 or 2% of Account Value
                                                                          (Only applicable if Account Value is less than $100,000)
                                                                        (Assessed annually on the Annuity's anniversary date or upon
                                                                                                 surrender)
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                                               ANNUAL FEES/CHARGES OF THE SUB-ACCOUNTS*
                                 (as a percentage of the average daily net assets of the Sub-accounts)
- --------------------------------------------------------------------- ------------------------------------------------------------------
                             FEE/CHARGE                                                        Amount Deducted
- --------------------------------------------------------------------- ------------------------------------------------------------------
Mortality & Expense Risk Charge                                                                     0.50%
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Administration Charge                                                                               0.15%
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- --------------------------------------------------------------------- ------------------------------------------------------------------
Distribution Charge**                                                                    0.60% in Annuity Years 1-8
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- --------------------------------------------------------------------- ------------------------------------------------------------------
Total Annual Charges of the Sub-accounts***                           1.25% per year of the value of each Sub-account in Annuity Years
                                                                                                   1-8****
- --------------------------------------------------------------------- ------------------------------------------------------------------
*    These charges are deducted daily and apply to Variable Investment Options only.
**   The Distribution Charge in Annuity Years 9+ is 0.00%.
***  The combination of the Mortality and Expense Risk Charges and  Administration  Charge is referred to as the "Insurance  Charge"
elsewhere in this Prospectus.
**** The Total Annual Charges of the Sub-accounts in Annuity Years 9+ are 0.65% per year of the value of each Sub-account.

The  following  table  provides  a  summary  of the fees and  charges  you will  incur if you elect  any of the  following  optional
benefits.  These fees and charges are described in more detail within this Prospectus.

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                                                YOUR OPTIONAL BENEFIT FEES AND CHARGES
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- ------------------------------------------------------------------------------------------- --------------------- ----------------------
                                     Optional Benefit                                         Optional Benefit    Total Annual Charge*
                                                                                                    Fee/
                                                                                                   Charge
- ------------------------------------------------------------------------------------------- --------------------- ----------------------
- ------------------------------------------------------------------------------------------- --------------------- ----------------------
GUARANTEED RETURN OPTION PlusSM (GRO PlusSM) (or GRO where GRO PlusSM is not available)
We offer a program  that  guarantees  a  "return  of  premium"  at a future  date,  while     0.25% of average    1.50% in Annuity
allowing you to allocate all or a portion of your Account Value to certain Sub-accounts.    daily net assets of   Years 1-8
                                                                                              the Sub-accounts
- ------------------------------------------------------------------------------------------- --------------------- ----------------------
- ------------------------------------------------------------------------------------------- --------------------- ----------------------
GUARANTEED MINIMUM WITHDRAWAL BENEFIT (GMWB)
We offer a program that guarantees  your ability to withdraw  amounts equal to an initial     0.35% of average    1.60% in Annuity
principal value, regardless of the impact of market performance on your Account Value.      daily net assets of   Years 1-8
                                                                                              the Sub-accounts
- ------------------------------------------------------------------------------------------- --------------------- ----------------------
- ------------------------------------------------------------------------------------------- --------------------- ----------------------
GUARANTEED MINIMUM INCOME BENEFIT (GMIB)                                                     0.50% per year of    1.25% in Annuity
We offer a program that,  after a seven-year  waiting period,  guarantees your ability to       the average       Years 1-8
begin  receiving  income  from your  Annuity in the form of annuity  payments  based on a     Protected Income            PLUS
guaranteed  minimum value (called the "Protected  Income Value") that increases after the     Value; deducted     0.50% per year of
waiting  period  begins,  regardless of the impact of market  performance on your Account   annually in arrears   average Protected
Value.                                                                                       each Annuity Year    Income Value
- ------------------------------------------------------------------------------------------- --------------------- ----------------------
- ------------------------------------------------------------------------------------------- --------------------- ----------------------
ENHANCED BENEFICIARY PROTECTION DEATH BENEFIT
We offer an Optional  Death  Benefit that provides an enhanced  level of  protection  for     0.25% of average      1.50% in Annuity
your  beneficiary(ies)  by providing  amounts in addition to the basic Death Benefit that   daily net assets of         Years 1-8
can be used to offset  federal  and state  taxes  payable  on any  taxable  gains in your     the Sub-accounts
Annuity at the time of your death.
- ------------------------------------------------------------------------------------------- --------------------- ----------------------
- ------------------------------------------------------------------------------------------- --------------------- ----------------------
HIGHEST ANNIVERSARY VALUE DEATH BENEFIT
We offer an Optional  Death  Benefit that provides an enhanced  level of  protection  for     0.25% of average      1.50% in Annuity
your  beneficiary(ies)  by  providing a death  benefit  equal to the greater of the basic   daily net assets of         Years 1-8
Death Benefit or the Highest Anniversary Value.                                               the Sub-accounts
- ------------------------------------------------------------------------------------------- --------------------- ----------------------
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Please  refer to the section of this  Prospectus  that  describes  each  optional  benefit for a complete  description  of the benefit,
including any restrictions or limitations that may apply.
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*    The Total Annual Charge includes the Insurance Charge and Distribution Charge assessed against the Annuity.  If you elect more
     than one optional benefit, the Total Annual Charge would be increased to include the charge for the optional benefit.  The
     Total Annual Charge for each optional benefit that has an Annual Charge of 0.25% will be 0.90% in Annuity Years 9+.  The Total
     Annual Charge for GMWB in Annuity Years 9+ will be 1.00%

The  following  table  provides  the range  (minimum  and maximum) of the total  annual  expenses  for the  underlying  mutual funds
("Portfolios")  as of December 31, 2002.  Each figure is stated as a percentage  of the  underlying  Portfolio's  average  daily net
assets.

- ----------------------------------------------------------------------------------------------------------------------------------------
                                               Total Annual Portfolio Operating Expenses
- ----------------------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------- -------------------------------------------- --------------------------------------------
                                                                 Minimum                                      Maximum
- ---------------------------------------------- -------------------------------------------- --------------------------------------------
- ---------------------------------------------- -------------------------------------------- --------------------------------------------
Total Portfolio Operating Expense                                0.14% *                                       3.14%
- ---------------------------------------------- -------------------------------------------- --------------------------------------------
*    The minimum total annual  portfolio  operating  expenses are those of a Portfolio  that may invest in mutual funds,  which also
     charge their own operating expenses.  Thus, the total annual portfolio operating expenses may be higher than indicated.


The following are the investment  management  fees, other expenses,  12b-1 fees (if  applicable),  and the total annual expenses for
each underlying  mutual fund  ("Portfolio") as of December 31, 2002,  except as noted.  Each figure is stated as a percentage of the
underlying  Portfolio's  average daily net assets.  For certain of the  underlying  Portfolios,  a portion of the  management fee is
being waived and/or other  expenses are being  partially  reimbursed.  "N/A"  indicates that no portion of the management fee and/or
other expenses is being waived and/or  reimbursed.  The "Net Annual  Portfolio  Operating  Expenses"  reflect the combination of the
underlying  Portfolio's  investment  management  fee,  other  expenses  and any  12b-1  fees,  net of any fee  waivers  and  expense
reimbursements.  The  following  expenses are deducted by the  underlying  Portfolio  before it provides  American  Skandia with the
daily net asset  value.  Any  footnotes  about  expenses  appear  after the list of all the  Portfolios.  The  underlying  Portfolio
information  was provided by the underlying  mutual funds and has not been  independently  verified by us. See the  prospectuses  or
statements of additional  information of the  underlying  Portfolios for further  details.  The current  prospectus and statement of
additional information for the underlying Portfolios can be obtained by calling 1-800-680-8920.

- ---------------------------------------------------------------------------------------------------------------------------------------
                                           UNDERLYING MUTUAL FUND PORTFOLIO ANNUAL EXPENSES
                               (as a percentage of the average net assets of the underlying Portfolios)
- ---------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------- --------------- ------------- -------------- ------------- ------------ -------------
                                                    Management     Other         12b-1 Fees    Total Annual   Fee          Net
                                                       Fees         Expenses                    Portfolio    Waivers       Annual
              UNDERLYING PORTFOLIO                                                              Operating    and           Portfolio
                                                                                                 Expenses    Expense       Operating
                                                                                                             Reimburse-mentExpenses

- ------------------------------------------------- --------------- ------------- -------------- ------------- ------------ -------------
- ---------------------------------------------------------------------------------------------------------------------------------------
Wells Fargo Variable Trust:
  International Equity                                0.75%          2.14%         0.25%          3.14%        2.14%         1.00%
  Small Cap Growth                                    0.75%          0.33%         0.25%          1.33%        0.13%         1.20%
  Growth                                              0.55%          0.35%         0.25%          1.15%        0.15%         1.00%
  Large Company Growth                                0.55%          0.29%         0.25%          1.09%        0.09%         1.00%
  Equity Value                                        0.55%          0.48%         0.25%          1.28%        0.28%         1.00%
  Equity Income                                       0.55%          0.30%         0.25%          1.10%        0.10%         1.00%
  Asset Allocation                                    0.55%          0.23%         0.25%          1.03%        0.03%         1.00%
  Total Return Bond 1                                 0.45%          0.33%         0.25%          1.03%        0.13%         0.90%

American Skandia Trust: 2
  AST Strong International Equity                     0.88%          0.21%          0.12%         1.21%         0.00%        1.21%
  AST William Blair International Growth              1.00%          0.23%          0.10%         1.33%         0.10%        1.23%
  AST American Century International Growth           1.00%          0.25%          0.00%         1.25%         0.00%        1.25%
  AST DeAM International Equity                       1.00%          0.44%          0.00%         1.44%         0.15%        1.29%
  AST MFS Global Equity                               1.00%          0.41%          0.00%         1.41%         0.00%        1.41%
  AST PBHG Small-Cap Growth                           0.90%          0.22%          0.11%         1.23%         0.00%        1.23%
  AST DeAM Small-Cap Growth                           0.95%          0.20%          0.00%         1.15%         0.15%        1.00%
  AST Federated Aggressive Growth                     0.95%          0.43%          0.00%         1.38%         0.03%        1.35%
  AST Gabelli Small-Cap Value                         0.90%          0.19%          0.01%         1.10%         0.00%        1.10%
  AST DeAM Small-Cap Value                            0.95%          0.53%          0.00%         1.48%         0.33%        1.15%
  AST Goldman Sachs Mid-Cap Growth                    1.00%          0.26%          0.07%         1.33%         0.10%        1.23%
  AST Neuberger Berman Mid-Cap Growth                 0.90%          0.20%          0.06%         1.16%         0.00%        1.16%
  AST Neuberger Berman Mid-Cap Value                  0.90%          0.17%          0.09%         1.16%         0.00%        1.16%
  AST Alger All-Cap Growth                            0.95%          0.19%          0.15%         1.29%         0.00%        1.29%
  AST Gabelli All-Cap Value                           0.95%          0.24%          0.00%         1.19%         0.00%        1.19%
  AST T. Rowe Price Natural Resources                 0.90%          0.23%          0.03%         1.16%         0.00%        1.16%
  AST Alliance Growth                                 0.90%          0.20%          0.03%         1.13%         0.00%        1.13%
  AST MFS Growth                                      0.90%          0.18%          0.10%         1.18%         0.00%        1.18%
  AST Marsico Capital Growth                          0.90%          0.16%          0.04%         1.10%         0.01%        1.09%
  AST Goldman Sachs Concentrated Growth               0.90%          0.15%          0.04%         1.09%         0.06%        1.03%
  AST DeAM Large-Cap Growth                           0.85%          0.23%          0.00%         1.08%         0.10%        0.98%
  AST DeAM Large-Cap Value                            0.85%          0.24%          0.04%         1.13%         0.10%        1.03%
  AST Alliance/Bernstein Growth + Value               0.90%          0.23%          0.00%         1.13%         0.00%        1.13%
  AST Sanford Bernstein Core Value                    0.75%          0.25%          0.00%         1.00%         0.00%        1.00%
  AST Cohen & Steers Realty                           1.00%          0.23%          0.03%         1.26%         0.00%        1.26%
  AST Sanford Bernstein Managed Index 500             0.60%          0.16%          0.08%         0.84%         0.00%        0.84%
  AST American Century Income & Growth                0.75%          0.23%          0.00%         0.98%         0.00%        0.98%
  AST Alliance Growth and Income                      0.75%          0.15%          0.08%         0.98%         0.02%        0.96%
  AST MFS Growth with Income                          0.90%          0.28%          0.01%         1.19%         0.00%        1.19%
  AST INVESCO Capital Income                          0.75%          0.17%          0.03%         0.95%         0.00%        0.95%
  AST DeAM Global Allocation                          0.10%          0.04%          0.00%         0.14%         0.00%        0.14%
- ---------------------------------------------------------------------------------------------------------------------------------------
                                           UNDERLYING MUTUAL FUND PORTFOLIO ANNUAL EXPENSES
                               (as a percentage of the average net assets of the underlying Portfolios)
- ---------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------- --------------- ------------- -------------- ------------- ------------ -------------
                                                    Management     Other         12b-1 Fees    Total Annual   Fee          Net
                                                       Fees         Expenses                    Portfolio    Waivers       Annual
              UNDERLYING PORTFOLIO                                                              Operating    and           Portfolio
                                                                                                 Expenses    Expense       Operating
                                                                                                             Reimburse-mentExpenses

- ------------------------------------------------- --------------- ------------- -------------- ------------- ------------ -------------
  AST American Century Strategic Balanced             0.85%          0.25%          0.00%         1.10%         0.00%        1.10%
  AST T. Rowe Price Asset Allocation                  0.85%          0.26%          0.00%         1.11%         0.00%        1.11%
  AST T. Rowe Price Global Bond                       0.80%          0.26%          0.00%         1.06%         0.00%        1.06%
  AST Federated High Yield                            0.75%          0.19%          0.00%         0.94%         0.00%        0.94%
  AST Lord Abbett Bond-Debenture                      0.80%          0.24%          0.00%         1.04%         0.00%        1.04%
  AST DeAM Bond                                       0.85%          0.23%          0.00%         1.08%         0.15%        0.93%
  AST PIMCO Total Return Bond                         0.65%          0.15%          0.00%         0.80%         0.02%        0.78%
  AST PIMCO Limited Maturity Bond                     0.65%          0.18%          0.00%         0.83%         0.00%        0.83%
  AST Money Market                                    0.50%          0.13%          0.00%         0.63%         0.05%        0.58%

- ------------------------------------------------- --------------- ------------- -------------- ------------- ------------ -------------
Gartmore Variable Investment Trust:
  GVIT Developing Markets                             1.15%          0.24%           0.25%         1.64%        0.00%        1.64%

INVESCO Variable Investment Funds, Inc.:
  Dynamics                                             0.75%         0.37%           0.00%         1.12%         0.00%        1.12%
  Technology                                           0.75%         0.36%           0.00%         1.11%         0.00%        1.11%
  Health Sciences                                      0.75%         0.32%           0.00%         1.07%         0.00%        1.07%
  Financial Services                                   0.75%         0.34%           0.00%         1.09%         0.00%        1.09%
  Telecommunications                                   0.75%         0.47%           0.00%         1.22%         0.00%        1.22%

Evergreen Variable Annuity Trust:
  International Equity3                                0.66%         0.39%           0.00%         1.05%         0.00%        1.05%
  Special Equity                                       0.92%         0.26%           0.00%         1.18%         0.15%        1.03%
  Omega                                                0.52%         0.18%           0.00%         0.70%         0.00%        0.70%

ProFund VP:
  Europe 30                                            0.75%         1.03%           0.25%         2.03%         0.05%        1.98%
  Asia 30                                              0.75%         1.03%           0.25%         2.03%         0.05%        1.98%
  Japan                                                0.75%         1.06%           0.25%         2.06%         0.08%        1.98%
  Banks                                                0.75%         1.11%           0.25%         2.11%         0.13%        1.98%
  Basic Materials                                      0.75%         1.21%           0.25%         2.21%         0.23%        1.98%
  Biotechnology                                        0.75%         1.16%           0.25%         2.16%         0.18%        1.98%
  Consumer Cyclical                                    0.75%         1.65%           0.25%         2.65%         0.67%        1.98%
  Consumer Non-Cyclical                                0.75%         1.10%           0.25%         2.10%         0.12%        1.98%
  Energy                                               0.75%         1.16%           0.25%         2.16%         0.18%        1.98%
  Financial                                            0.75%         1.14%           0.25%         2.14%         0.16%        1.98%
  Healthcare                                           0.75%         1.14%           0.25%         2.14%         0.16%        1.98%
  Industrial                                           0.75%         1.65%           0.25%         2.65%         0.67%        1.98%
  Internet                                             0.75%         1.04%           0.25%         2.04%         0.06%        1.98%
  Pharmaceuticals                                      0.75%         1.12%           0.25%         2.12%         0.14%        1.98%
  Precious Metals                                      0.75%         0.98%           0.25%         1.98%          N/A         1.98%
  Real Estate                                          0.75%         1.13%           0.25%         2.13%         0.15%        1.98%
  Semiconductor                                        0.75%         1.33%           0.25%         2.33%         0.35%        1.98%
  Technology                                           0.75%         1.27%           0.25%         2.27%         0.29%        1.98%
  Telecommunications                                   0.75%         1.19%           0.25%         2.19%         0.21%        1.98%
  Utilities                                            0.75%         1.17%           0.25%         2.17%         0.19%        1.98%
  Bull                                                 0.75%         0.91%           0.25%         1.91%          N/A         1.91%
  Bear                                                 0.75%         1.03%           0.25%         2.03%         0.05%        1.98%
  UltraBull 4                                          0.75%         1.12%           0.25%         2.12%         0.27%        1.85%
  OTC                                                  0.75%         1.03%           0.25%         2.03%         0.05%        1.98%
  Short OTC                                            0.75%         0.96%           0.25%         1.96%          N/A         1.96%
  UltraOTC                                             0.75%         1.08%           0.25%         2.08%         0.13%        1.95%
  Mid-Cap Value                                        0.75%         1.25%           0.25%         2.25%         0.27%        1.98%
  Mid-Cap Growth                                       0.75%         1.22%           0.25%         2.22%         0.24%        1.98%
  UltraMid-Cap                                         0.75%         1.36%           0.25%         2.36%         0.38%        1.98%
                                                                                               ------------- ------------ -------------
- ---------------------------------------------------------------------------------------------------------------------------------------
                                           UNDERLYING MUTUAL FUND PORTFOLIO ANNUAL EXPENSES
                               (as a percentage of the average net assets of the underlying Portfolios)
- ---------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------- --------------- ------------- -------------- ------------- ------------ -------------
                                                    Management     Other         12b-1 Fees    Total Annual   Fee          Net
                                                       Fees         Expenses                    Portfolio    Waivers       Annual
              UNDERLYING PORTFOLIO                                                              Operating    and           Portfolio
                                                                                                 Expenses    Expense       Operating
                                                                                                             Reimburse-mentExpenses

- ------------------------------------------------- --------------- ------------- -------------- ------------- ------------ -------------
  Small-Cap Value                                      0.75%         1.45%           0.25%         2.45%         0.47%        1.98%
  Small-Cap Growth                                     0.75%         1.20%           0.25%         2.20%         0.22%        1.98%
  UltraSmall-Cap                                       0.75%         1.15%           0.25%         2.15%         0.17%        1.98%
  U.S. Government Plus                                 0.50%         0.96%           0.25%         1.71%          N/A         1.71%
  Rising Rates Opportunity                             0.75%         1.13%           0.25%         2.13%         0.15%        1.98%

- ------------------------------------------------- --------------- ------------- -------------- ------------- ------------ -------------
- ------------------------------------------------- --------------- ------------- -------------- ------------- ------------ -------------
First Defined Portfolio Fund LLC:
  First Trust(R)10 Uncommon Values                     0.60%          2.29%          0.25%         3.14%         1.95%        1.37%

The Prudential Series Fund, Inc.:
SP Jennison International Growth                      0.85%          0.70%          0.25%         1.80%         0.16%        1.64%
- ------------------------------------------------- --------------- ------------- -------------- ------------- ------------ -------------

1        Effective  May 1, 2003,  the Wells  Fargo  Variable  Trust  Corporate  Bond  portfolio  changed its name to the Wells Fargo
     Variable Trust Total Return Bond portfolio.  The name change was made in conjunction with a change in investment strategy.
2        The  Investment  Manager of American  Skandia  Trust (the  "Trust") has agreed to  reimburse  and/or waive fees for certain
     Portfolios  until at least April 30, 2004. The caption "Total Annual  Portfolio  Operating  Expenses"  reflects the Portfolios'
     fees and expenses before such waivers and reimbursements,  while the caption "Net Annual Portfolio Operating Expenses" reflects
     the effect of such waivers and  reimbursements.  The Trust adopted a  Distribution  Plan (the  "Distribution  Plan") under Rule
     12b-1 of the  Investment  Company Act of 1940 to permit an affiliate  of the Trust's  Investment  Manager to receive  brokerage
     commissions in connection with purchases and sales of securities held by Portfolios of the Trust, and to use these  commissions
     to promote  the sale of shares of such  Portfolios.  While the  brokerage  commission  rates and  amounts  paid by the  various
     Portfolios  are not  expected  to increase as a result of the  Distribution  Plan,  the staff of the  Securities  and  Exchange
     Commission takes the position that commission  amounts received under the Distribution Plan should be reflected as distribution
     expenses of the Portfolios.  The Distribution Fee estimates are derived and annualized from data regarding  commission  amounts
     directed under the Distribution  Plan.  Although there are no maximum amounts  allowable,  actual  commission  amounts directed
     under the Distribution  Plan will vary and the amounts  directed during the last full fiscal year of the Plan's  operations may
     differ from the amounts listed in the above chart.
3        On December 5, 2003, all of the assets of the Evergreen  Variable  Annuity Trust Global Leaders  portfolio were transferred
     to the Evergreen Variable Annuity Trust  International  Equity portfolio (the "Merger").  The annual expenses are based on what
     the estimated  combined expenses of the  International  Equity portfolio would have been for the 12 months ended June 30, 2003.
     The annual expenses of the  International  Equity portfolio prior to the Merger were as follows:  Management Fee: 0.66%;  12b-1
     Fee: 0.00%;  Other Expenses 0.73%;  Total Annual Portfolio  Operating  Expenses:  1.39%; Fee Waiver and Expense  Reimbursement:
     0.39%; Net Annual Portfolio Operating Expenses:  1.00%.
4        Effective  May 1, 2003,  the ProFunds VP Bull Plus  portfolio  changed its name to ProFund VP UltraBull to reflect a change
     in its investment objective.

EXPENSE EXAMPLES
These  examples  are  designed to assist you in  understanding  the various  expenses  you may incur with the Annuity  over  certain
periods of time based on specific  assumptions.  The examples  reflect the  Contingent  Deferred  Sales Charges  (when  applicable),
Annual Maintenance Fee, Insurance Charge,  Distribution  Charge (when applicable),  and the maximum total annual portfolio operating
expenses for the underlying  Portfolio  (shown above),  as well as the charges for the optional  benefits that are offered under the
Annuity.  The Securities and Exchange Commission ("SEC") requires these examples.

Below are  examples  showing  what you would pay in  expenses at the end of the stated time  periods  for each  Sub-account  had you
invested $10,000 in the Annuity and received a 5% annual return on assets, and elected all optional benefits available.

The examples  shown assume that:  (a) you only allocate  Account Value to the  Sub-account  with the maximum total annual  portfolio
operating expenses for the underlying  Portfolio (shown above),  not to a Fixed Allocation;  (b) the Insurance Charge is assessed as
0.65% per year; (c) the  Distribution  Charge is assessed as 0.60% per year in Annuity Years 1 - 8; (d) the Annual  Maintenance  Fee
(when  applicable) is reflected as an asset-based  charge based on an assumed average  contract size; (e) you make no withdrawals of
Account Value during the period shown; (f) you make no transfers,  withdrawals,  surrender or other transactions for which we charge
a fee during the period  shown;  (g) no tax charge  applies;  (h) the maximum  total  annual  portfolio  operating  expenses for the
underlying  Portfolio  (shown  above) are  reflected;  and (i) the charge for each  optional  benefit is reflected as an  additional
charge equal to 0.25% per year,  respectively,  for the Guaranteed  Return Option Plus, the Enhanced  Beneficiary  Protection  Death
Benefit and the Highest  Anniversary Value Death Benefit and 0.35% for the Guaranteed Minimum Withdrawal  Benefit.  Amounts shown in
the examples are rounded to the nearest dollar.

The Expense Examples do not reflect a charge for the Guaranteed Minimum Income Benefit, which is deducted annually in arrears.

Expense  Examples  are  provided as follows:  1.) if you  surrender  the  Annuity at the end of the stated time  period;  2.) if you
annuitize at the end of the stated time period; and 3.) if you do not surrender your Annuity.

THE EXAMPLES ARE  ILLUSTRATIVE  ONLY - THEY SHOULD NOT BE CONSIDERED A  REPRESENTATION  OF PAST OR FUTURE EXPENSES OF THE UNDERLYING
MUTUAL FUNDS OR THEIR  PORTFOLIOS - ACTUAL  EXPENSES WILL BE LESS THAN THOSE SHOWN IF YOU DO NOT ELECT ALL OF THE OPTIONAL  BENEFITS
AVAILABLE OR IF YOU ALLOCATE ACCOUNT VALUE TO ANY OTHER AVAILABLE SUB-ACCOUNTS.


If you surrender your contract at the end of the applicable time period:

            ----------------------------- --------------------------- --------------------------- --------------------------
                       1 year                      3 years                     5 years                    10 years
            ----------------------------- --------------------------- --------------------------- --------------------------
            ----------------------------- --------------------------- --------------------------- --------------------------
                       $1,232                       $2,247                      $3,204                     $5,320
            ----------------------------- --------------------------- --------------------------- --------------------------


If you annuitize at the end of the applicable time period:

            ----------------------------- --------------------------- --------------------------- --------------------------
                       1 year                      3 years                     5 years                    10 years
            ----------------------------- --------------------------- --------------------------- --------------------------
            ----------------------------- --------------------------- --------------------------- --------------------------
                        $557                        $1,662                      $2,754                     $5,320
            ----------------------------- --------------------------- --------------------------- --------------------------

If you do not surrender your contract:

            ----------------------------- --------------------------- --------------------------- --------------------------
                       1 year                      3 years                     5 years                    10 years
            ----------------------------- --------------------------- --------------------------- --------------------------
            ----------------------------- --------------------------- --------------------------- --------------------------
                        $557                        $1,662                      $2,754                     $5,320
            ----------------------------- --------------------------- --------------------------- --------------------------


INVESTMENT OPTIONS

WHAT ARE THE INVESTMENT OBJECTIVES AND POLICIES OF THE PORTFOLIOS?

Each variable  investment option is a Sub-account of American Skandia Life Assurance  Corporation  Variable Account B (see "What are
Separate  Accounts" for more detailed  information.)  Each Sub-account  invests  exclusively in one Portfolio.  You should carefully
read the prospectus for any Portfolio in which you are interested.  The following chart  classifies each of the Portfolios  based on
our  assessment  of their  investment  style (as of the date of this  Prospectus).  The chart also  provides a  description  of each
Portfolio's  investment  objective (in italics) and a short,  summary description of their key policies to assist you in determining
which  Portfolios  may be of  interest  to you.  There is no  guarantee  that any  underlying  Portfolio  will  meet its  investment
objective.

The name of the  advisor/sub-advisor  for each Portfolio  appears next to the description.  Those Portfolios whose name includes the
prefix "AST" are Portfolios of American Skandia Trust. The investment  managers for AST are American  Skandia  Investment  Services,
Incorporated,  an affiliated  company of American Skandia and Prudential  Investments LLC. However,  a sub-advisor,  as noted below,
is engaged to conduct day-to-day investment decisions.

The Portfolios are not publicly traded mutual funds.  They are only available as investment  options in variable  annuity  contracts
and variable  life  insurance  policies  issued by insurance  companies,  or in some cases,  to  participants  in certain  qualified
retirement  plans.  However,  some of the Portfolios  available as Sub-accounts  under the Annuity are managed by the same portfolio
advisor or  sub-advisor  as a retail  mutual fund of the same or similar name that the  Portfolio may have been modeled after at its
inception.  Certain retail mutual funds may also have been modeled after a Portfolio.  While the  investment  objective and policies
of the retail  mutual  funds and the  Portfolios  may be  substantially  similar,  the  actual  investments  will  differ to varying
degrees.  Differences  in the  performance  of the funds can be  expected,  and in some cases could be  substantial.  You should not
compare the  performance  of a publicly  traded mutual fund with the  performance  of any  similarly  named  Portfolio  offered as a
Sub-account.  Details about the  investment  objectives,  policies,  risks,  costs and management of the Portfolios are found in the
prospectuses  for the underlying  mutual funds.  The current  prospectus and statement of additional  information for the underlying
Portfolios can be obtained by calling 1-800-680-8920.

Please refer to Appendix B for certain required financial information related to the historical performance of the Sub-accounts.

- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      STYLE/                                        INVESTMENT OBJECTIVES/POLICIES                                         PORTFOLIO
       TYPE                                                                                                                 ADVISOR/
                                                                                                                          SUB-ADVISOR
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      INTER-        WFVT International Equity: seeks total return, with an emphasis on capital  appreciation,  over    Wells Fargo Funds
 NATIONAL EQUITY    the  long-term.  The Portfolio  pursues its  objective by investing  primarily in a diversified     Management, LLC
                    portfolio of equity  securities  of  companies  based in developed  non-U.S.  countries  and in
                    emerging markets of the world. Under normal market  conditions,  the Portfolio invests at least
                    80% of its total  assets in equity  securities  of companies  located or operating  outside the
                    U.S. and in a minimum of five  countries  exclusive of the U.S. The  Portfolio may invest up to
                    50% of its total assets in any one country and up to 25% of total  assets in emerging  markets.
                    Generally,  the  Portfolio  invests in issuers  with an average  market  capitalization  of $10
                    billion  or  more,  although  it may  invest  in  equity  securities  of  issuers  with  market
                    capitalization as low as $250 million.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    ------------------------------------------------------------------------------------------------ -----------------------
 SMALL CAP EQUITY   WFVT Small Cap  Growth:  seeks  long-term  capital  appreciation.  The  Portfolio  pursues  its    Wells Fargo Funds
                    objective by investing in a diversified  portfolio of common  stocks issued by companies  whose     Management, LLC
                    market  capitalization  falls with the range of the Russell 2000 Index.  The Portfolio  invests
                    in common stocks of domestic and foreign  companies that the Investment  Advisor  believes have
                    above-average  prospects  for capital  growth,  or that may be  involved  in new or  innovative
                    products,  services and processes.  Under normal market conditions, the Portfolio invests in an
                    actively managed, broadly diversified portfolio of small-cap  growth-oriented common stocks and
                    in at least 20 common stock issues spread across  multiple  industry  groups and sectors of the
                    economy.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    WFVT Growth:  seeks  long-term  capital  appreciation.  The Portfolio  pursues its objective by
                    investing  primarily in common  stocks and other  equity  securities  of companies  that have a
                    strong earnings growth trend that the Investment Advisor believes have above-average  prospects
 LARGE CAP EQUITY   for future  growth.  Under normal  market  conditions,  the  Portfolio  invests at least 65% of
                    total  assets in equity  securities,  including  common and  preferred  stocks  and  securities    Wells Fargo Funds
                    convertible  into common stocks.  The investment  strategy is focused on larger  capitalization     Management, LLC
                    stocks that fall within, but towards the higher end of, the range of the Russell 1000 Index.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    WFVT Large Company Growth:  seeks long-term  capital  appreciation.  The Portfolio  pursues its
                    objective by investing  primarily in common stocks of large,  high-quality  domestic  companies
                    that the Investment  Advisor believes have superior growth  potential.  The Investment  Advisor
 LARGE CAP EQUITY   looks for companies  whose growth  potential is generally  unrecognized  or misperceived by the    Wells Fargo Funds
                    market.  The  Portfolio  may invest,  under  normal  market  conditions,  at least 80% of total     Management, LLC
                    assets in securities with market  capitalizations of $3 billion or more, and up to 20% of total
                    assets in securities of foreign companies..
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    ------------------------------------------------------------------------------------------------ -----------------------
 LARGE CAP EQUITY   WFVT Equity Value:  seeks long-term  capital  appreciation and  above-average  dividend income.    Wells Fargo Funds
                    The  Portfolio  pursues its  objective by  investing  primarily  in equity  securities  of U.S.
                    companies  with strong  return  potential  based on current  market  valuations.  Under  normal
                    circumstances,  the Portfolio  invests at least 80% of its assets in equity securities with the
                    same  characteristics  as common stocks, and in preferred stocks,  warrants,  and securities of     Management, LLC
                    foreign companies through ADRs and similar investments.
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  EQUITY INCOME     WFVT Equity Income:  seeks long-term capital  appreciation and  above-average  dividend income.    Wells Fargo Funds
                    The  Portfolio  pursues its  objective  primarily by  investing in the common  stocks of large,     Management, LLC
                    domestic companies with  above-average  return potential based on current market valuations and
                    above-average  dividend income. Under normal market conditions,  the Portfolio invests at least
                    80% of its total assets in income producing  equity  securities and in issues of companies with
                    market capitalizations of $3 billion or more.
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- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
ASSET ALLOCATION    WFVT Asset  Allocation:  seeks  long-term total return,  consistent  with reasonable  risk. The
                    Portfolio  pursues its objective by allocating and  reallocating its assets among common stocks
                    and U.S.  Treasury Bonds.  The Investment  Advisor manages the allocation of investments in the
                    Portfolio  assuming a  "neutral"  target  allocation  of 60%  stocks  and 40% bonds.  The stock     Wells Capital
                    portion of the  Portfolio is invested to replicate the  weightings  of each company  comprising        Management
                    the S&P 500 Index.  The bond  portion of the  Portfolio  is  invested to  replicate  the Lehman       Incorporated
                    Brothers 20+ Year Treasury Index.
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- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      STYLE/                                        INVESTMENT OBJECTIVES/POLICIES                                         PORTFOLIO
       TYPE                                                                                                                 ADVISOR/
                                                                                                                          SUB-ADVISOR
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
       BOND         WFVT Total Return Bond (f/k/a WFVT  Corporate  Bond):  seeks total return  consisting of income    Wells Fargo Funds
                    and capital  appreciation.  The  Portfolio  pursues its objective by investing  principally  in     Management, LLC
                    investment-grade debt securities,  which include U.S. Government obligations,  corporate bonds,
                    asset-backed  securities  and  money  market  instruments.  Under  normal  circumstances,   the
                    Portfolio will invest at least 80% of its assets in bonds.
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  INTERNATIONAL     AST Strong  International  Equity: seeks long-term capital growth by investing in a diversified      Strong Capital
      EQUITY        portfolio  of  international  equity  securities  the issuers of which are  considered  to have      Management, Inc.
                    strong  earnings  momentum.  The  Portfolio  seeks to meet its  objective by  investing,  under
                    normal  market  conditions,  at least 80% of its total  assets in a  diversified  portfolio  of
                    equity  securities  of  companies  located or operating in  developed  non-U.S.  countries  and
                    emerging  markets  of the  world.  The  Sub-advisor  intends  to  focus  on  companies  with an
                    above-average   potential  for  long-term  growth  and  attractive  relative  valuations.   The
                    Sub-advisor selects companies based on five key factors: growth,  valuation,  management,  risk
                    and sentiment.
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  INTERNATIONAL     AST William Blair  International  Growth (f/k/a AST Janus  Overseas  Growth):  seeks  long-term     William Blair &
      EQUITY        growth of capital.  The  Portfolio  pursues its  objective  primarily  through  investments  in     Company, L.L.C.
                    equity  securities  of issuers  located  outside  the United  States.  The  Portfolio  normally
                    invests at least 80% of its total assets in securities of issuers from at least five  different
                    countries,  excluding the United States.  The Portfolio invests primarily in companies selected
                    for their growth  potential.  Securities are generally  selected  without regard to any defined
                    allocation among countries,  geographic regions or industry sectors, or other similar selection
                    procedure.
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  INTERNATIONAL     AST American Century  International  Growth:  seeks capital growth.  The Portfolio will seek to
      EQUITY        achieve its investment  objective by investing  primarily in equity securities of international
                    companies  that the  Sub-advisor  believes  will  increase  in value  over time.  Under  normal
                    conditions,  the  Portfolio  will  invest at least 65% of its  assets in equity  securities  of
                    issuers from at least three  countries  outside of the United States.  The  Sub-advisor  uses a
                    growth  investment  strategy it developed  that looks for  companies  with earnings and revenue
                    growth.  The  Sub-advisor  will  consider  a  number  of other  factors  in  making  investment     American Century
                    selections,  including the prospects for relative  economic  growth among countries or regions,        Investment
                    economic and political  conditions,  expected inflation rates,  currency exchange  fluctuations     Management, Inc.
                    and tax considerations.
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                    AST DeAM  International  Equity:  seeks capital growth.  The Portfolio pursues its objective by
                    investing  at least 80% of the value of its assets in the equity  securities  of  companies  in
                    developed  non-U.S.  countries that are represented in the MSCI EAFE(R)Index. The target of this
  INTERNATIONAL     Portfolio  is to track the  performance  of the MSCI  EAFE(R)Index  within  4% with a  standard      Deutsche Asset
      EQUITY        deviation  expected of +/- 4%. The  Sub-advisor  considers  a number of factors in  determining     Management, Inc.
                    whether to invest in a stock,  including  earnings growth rate,  analysts'  estimates of future
                    earnings and industry-relative price multiples.
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- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    AST MFS Global Equity:  seeks capital growth.  Under normal circumstances the Portfolio invests
                    at least 80% of its assets in equity securities of U.S. and foreign issuers  (including issuers      Massachusetts
  GLOBAL EQUITY     in developing  countries).  The Portfolio  generally seeks to purchase  securities of companies    Financial Services
                    with relatively large market capitalizations relative to the market in which they are traded.           Company
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
 SMALL CAP GROWTH   AST PBHG  Small-Cap  Growth:  seeks  capital  growth.  The  Portfolio  pursues its objective by     Pilgrim Baxter &
                    primarily  investing  at  least  80% of the  value  of its  assets  in  the  common  stocks  of     Associates, Ltd.
                    small-sized  companies,  whose market  capitalizations are similar to market capitalizations of
                    the  companies  in the  Russell  2000(R)Index at the time of the  Portfolio's  investment.  The
                    Sub-advisor  expects to focus primarily on those  securities  whose market  capitalizations  or
                    annual revenues are less than $1billion at the time of purchase.
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- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      STYLE/                                        INVESTMENT OBJECTIVES/POLICIES                                         PORTFOLIO
       TYPE                                                                                                                 ADVISOR/
                                                                                                                          SUB-ADVISOR
                    ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
 SMALL CAP GROWTH   AST DeAM  Small-Cap  Growth:  seeks maximum  growth of  investors'  capital from a portfolio of      Deutsche Asset
                    growth  stocks of  smaller  companies.  The  Portfolio  pursues  its  objective,  under  normal     Management, Inc.
                    circumstances,  by  primarily  investing  at  least  80%  of its  total  assets  in the  equity
                    securities  of  small-sized   companies  included  in  the  Russell  2000  Growth(R)Index.  The
                    Sub-advisor  employs  an  investment  strategy  designed  to  maintain  a  portfolio  of equity
                    securities  which  approximates  the market risk of those  stocks  included in the Russell 2000
                    Growth(R)Index, but which attempts to outperform the Russell 2000 Growth(R)Index.
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- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    AST Federated  Aggressive  Growth:  seeks capital growth.  The Portfolio pursues its investment
                    objective by investing in the stocks of small  companies  that are traded on national  security   Federated Investment
    SMALL CAP       exchanges,  NASDAQ stock  exchange and the  over-the-counter-market.  Small  companies  will be   Counseling/Federated
      GROWTH        defined as  companies  with market  capitalizations  similar to  companies  in the Russell 2000    Global Investment
                    Index or the Standard & Poor's  Small Cap 600 Index.  Up to 25% of the  Portfolio's  net assets     Management Corp.
                    may be invested in foreign securities, which are typically denominated in foreign currencies.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    ------------------------------------------------------------------------------------------------ -----------------------
 SMALL CAP VALUE    AST Gabelli Small-Cap Value:  seeks to provide long-term capital growth by investing  primarily          GAMCO
                    in  small-capitalization  stocks  that  appear to be  undervalued.  The  Portfolio  will have a     Investors, Inc.
                    non-fundamental policy to invest, under normal circumstances,  at least 80% of the value of its
                    assets in small capitalization  companies.  The 80% investment  requirement applies at the time
                    the  Portfolio  invests  its assets.  The  Portfolio  generally  defines  small  capitalization
                    companies as those with a capitalization  of $1.5 billion or less.  Reflecting a value approach
                    to  investing,  the Portfolio  will seek the stocks of companies  whose current stock prices do
                    not appear to adequately reflect their underlying value as measured by assets,  earnings,  cash
                    flow or business franchises.
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- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
 SMALL CAP VALUE    AST DeAM Small-Cap Value:  seeks maximum growth of investors'  capital.  The Portfolio  pursues      Deutsche Asset
                    its  objective,  under normal  market  conditions,  by primarily  investing at least 80% of its     Management, Inc.
                    total assets in the equity  securities of small-sized  companies  included in the Russell 2000(R)
                    Value Index. The Sub-advisor  employs an investment  strategy  designed to maintain a portfolio
                    of equity  securities  which  approximates  the market  risk of those  stocks  included  in the
                    Russell 2000(R)Value Index, but which attempts to outperform the Russell 2000(R)Value Index.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
  MID-CAP GROWTH    AST Goldman Sachs Mid-Cap  Growth (f/k/a AST Janus Mid-Cap  Growth):  seeks  long-term  capital   Goldman Sachs Asset
                    growth.  The  Portfolio  pursues its  investment  objective,  by investing  primarily in equity        Management
                    securities selected for their growth potential,  and normally invests at least 80% of the value
                    of its assets in medium capitalization  companies. For purposes of the Portfolio,  medium-sized
                    companies  are those whose market  capitalizations  (measured at the time of  investment)  fall
                    within the range of  companies  in the  Standard & Poor's  MidCap  400 Index.  The  Sub-advisor
                    seeks  to  identify  individual  companies  with  earnings  growth  potential  that  may not be
                    recognized by the market at large.
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- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
  MID-CAP GROWTH    AST Neuberger  Berman Mid-Cap  Growth:  seeks capital growth.  Under normal market  conditions,     Neuberger Berman
                    the Portfolio  primarily invests at least 80% of its net assets in the common stocks of mid-cap     Management Inc.
                    companies.  For purposes of the Portfolio,  companies with equity market  capitalizations  that
                    fall within the range of the Russell Midcap(R)Index,  at the time of investment,  are considered
                    mid-cap  companies.  Some of the  Portfolio's  assets  may be  invested  in the  securities  of
                    large-cap companies as well as in small-cap  companies.  The Sub-advisor looks for fast-growing
                    companies that are in new or rapidly evolving industries.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------

- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      STYLE/                                        INVESTMENT OBJECTIVES/POLICIES                                         PORTFOLIO
       TYPE                                                                                                                 ADVISOR/
                                                                                                                          SUB-ADVISOR
                    ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
   MID-CAP VALUE    AST Neuberger Berman Mid-Cap Value: seeks capital growth.  Under normal market conditions,  the     Neuberger Berman
                    Portfolio  primarily  invests at least 80% of its net  assets in the  common  stocks of mid-cap     Management Inc.
                    companies.  For purposes of the Portfolio,  companies with equity market  capitalizations  that
                    fall within the range of the Russell  Midcap(R)Index at the time of investment  are  considered
                    mid-cap  companies.  Some of the  Portfolio's  assets  may be  invested  in the  securities  of
                    large-cap  companies as well as in small-cap  companies.  Under the Portfolio's  value-oriented
                    investment  approach,  the Sub-advisor looks for well-managed  companies whose stock prices are
                    undervalued and that may rise in price before other investors realize their worth.
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- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      ALL-CAP       AST Alger All-Cap Growth:  seeks long-term  capital growth.  The Portfolio invests primarily in        Fred Alger
      GROWTH        equity securities,  such as common or preferred stocks, that are listed on U.S. exchanges or in     Management, Inc.
                    the  over-the-counter  market.  The Portfolio may invest in the equity  securities of companies
                    of all sizes,  and may emphasize  either  larger or smaller  companies at a given time based on
                    the Sub-advisor's assessment of particular companies and market conditions.
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- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    AST Gabelli  All-Cap  Value:  seeks  capital  growth.  The  Portfolio  pursues its objective by
                    investing primarily in readily marketable equity securities including common stocks,  preferred
                    stocks and  securities  that may be converted at a later time into common stock.  The Portfolio
      ALL-CAP       may invest in the  securities  of companies of all sizes,  and may  emphasize  either larger or
       VALUE        smaller  companies  at a  given  time  based  on the  Sub-advisor's  assessment  of  particular  GAMCO Investors, Inc.
                    companies and market  conditions.  The Portfolio  focuses on companies that appear  underpriced
                    relative  to their  private  market  value  ("PMV").  PMV is the  value  that  the  Portfolio's
                    Sub-advisor believes informed investors would be willing to pay for a company.
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- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    AST T. Rowe Price Natural  Resources:  seeks  long-term  capital growth  primarily  through the
                    common stocks of companies  that own or develop  natural  resources  (such as energy  products,
                    precious  metals and forest  products)  and other basic  commodities.  The  Portfolio  normally
                    invests  primarily (at least 80% of its total assets) in the common stocks of natural  resource
      SECTOR        companies whose earnings and tangible  assets could benefit from  accelerating  inflation.  The      T. Rowe Price
                    Portfolio looks for companies that have the ability to expand production,  to maintain superior     Associates, Inc.
                    exploration  programs  and  production   facilities,   and  the  potential  to  accumulate  new
                    resources.  At least 50% of Portfolio assets will be invested in U.S. securities,  up to 50% of
                    total assets also may be invested in foreign securities.
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- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    AST Alliance  Growth:  seeks long-term  capital growth.  The Portfolio  invests at least 80% of
                    its total assets in the equity  securities of a limited  number of large,  carefully  selected,
                    high-quality  U.S.  companies  that are judged  likely to  achieve  superior  earnings  growth.
 LARGE CAP GROWTH   Normally,  about 40-60  companies will be  represented in the Portfolio,  with the 25 companies     Alliance Capital
                    most  highly  regarded  by  the  Sub-advisor  usually  constituting  approximately  70%  of the     Management, L.P.
                    Portfolio's  net assets.  An emphasis is placed on identifying  companies  whose  substantially
                    above average prospective earnings growth is not fully reflected in current market valuations.
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- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
 LARGE CAP GROWTH   AST MFS  Growth:  seeks  long-term  capital  growth  and future  income.  Under  normal  market
                    conditions,  the  Portfolio  invests  at least 80% of its total  assets  in common  stocks  and
                    related securities,  such as preferred stocks,  convertible securities and depositary receipts,
                    of companies that the  Sub-advisor  believes offer better than average  prospects for long-term      Massachusetts
                    growth.  The Sub-advisor seeks to purchase  securities of companies that it considers  well-run    Financial Services
                    and  poised  for  growth.  The  Portfolio  may  invest up to 35% of its net  assets in  foreign         Company
                    securities.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------

- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      STYLE/                                        INVESTMENT OBJECTIVES/POLICIES                                         PORTFOLIO
       TYPE                                                                                                                 ADVISOR/
                                                                                                                          SUB-ADVISOR
                    ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
 LARGE CAP GROWTH   AST Marsico  Capital  Growth:  seeks capital  growth.  Income  realization is not an investment     Marsico Capital
                    objective  and  any  income  realized  on  the  Portfolio's  investments,  therefore,  will  be     Management, LLC
                    incidental to the Portfolio's  objective.  The Portfolio will pursue its objective by investing
                    primarily in common stocks of larger,  more  established  companies.  In selecting  investments
                    for the Portfolio,  the Sub-advisor uses an approach that combines "top down" economic analysis
                    with "bottom up" stock selection.  The "top down" approach identifies  sectors,  industries and
                    companies that should benefit from the trends the  Sub-advisor  has observed.  The  Sub-advisor
                    then looks for individual  companies with earnings growth  potential that may not be recognized
                    by the market at large, a "bottom up" stock selection.
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- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    AST Goldman Sachs Concentrated  Growth (f/k/a AST JanCap Growth):  seeks growth of capital in a
                    manner  consistent  with  the  preservation  of  capital.   Realization  of  income  is  not  a
                    significant  investment  consideration and any income realized on the Portfolio's  investments,
                    therefore,  will be  incidental to the  Portfolio's  objective.  The Portfolio  will pursue its
 LARGE CAP GROWTH   objective  by investing  primarily  in equity  securities  of  companies  that the  Sub-advisor   Goldman Sachs Asset
                    believes have  potential to achieve  capital  appreciation  over the  long-term.  The Portfolio        Management
                    seeks to achieve  its  investment  objective  by  investing,  under  normal  circumstances,  in
                    approximately  30 - 45 companies  that are  considered by the  Sub-advisor to be positioned for
                    long-term growth.
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- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    AST DeAM  Large-Cap  Growth:  seeks  maximum  growth of capital by  investing  primarily in the
                    growth stocks of larger  companies.  The Portfolio  pursues its objective,  under normal market
                    conditions,  by primarily  investing at least 80% of its total assets in the equity  securities
 LARGE CAP GROWTH   of large-sized  companies  included in the Russell 1000(R)Growth Index. The Sub-advisor  employs      Deutsche Asset
                    an  investment   strategy   designed  to  maintain  a  portfolio  of  equity  securities  which     Management, Inc.
                    approximates  the market risk of those stocks  included in the Russell 1000(R)Growth Index,  but
                    which attempts to outperform the Russell 1000(R)Growth Index through active stock selection.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    AST DeAM Large-Cap Value (f/k/a AST Janus Strategic Value):  seeks maximum growth of capital by
                    investing  primarily  in the value  stocks of  larger  companies.  The  Portfolio  pursues  its
                    objective,  under normal market conditions, by primarily investing at least 80% of the value of
                    its assets in the equity  securities  of  large-sized  companies  included in the Russell 1000(R)    Deutsche Asset
  LARGE CAP VALUE   Value Index. The Sub-advisor  employs an investment  strategy  designed to maintain a portfolio     Management, Inc.
                    of equity  securities  which  approximates  the market  risk of those  stocks  included  in the
                    Russell  1000(R)Value Index,  but which  attempts to  outperform  the Russell  1000(R)Value Index
                    through active stock selection.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
    LARGE CAP       AST Alliance/Bernstein  Growth + Value: seeks capital growth by investing  approximately 50% of     Alliance Capital
      BLEND         its assets in growth  stocks of large  companies and  approximately  50% of its assets in value     Management, L.P.
                    stocks of large  companies.  The Portfolio will invest primarily in common stocks of large U.S.
                    companies  included in the Russell  1000(R)Index (the "Russell  1000(R)").  The Russell 1000(R)is a
                    market  capitalization-weighted  index that measures the  performance of the 1,000 largest U.S.
                    companies.  Normally,  about 60-85  companies will be represented in the Portfolio,  with 25-35
                    companies  primarily from the Russell 1000(R)Growth Index constituting  approximately 50% of the
                    Portfolio's  net assets and 35-50  companies  primarily  from the  Russell  1000(R)Value  Index
                    constituting  the  remainder  of  the  Portfolio's  net  assets.   There  will  be  a  periodic
                    rebalancing  of each  segment's  assets  to take  account  of market  fluctuations  in order to
                    maintain the approximately equal allocation.
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- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
  LARGE CAP VALUE   AST Sanford  Bernstein Core Value:  seeks  long-term  capital growth by investing  primarily in   Sanford C. Bernstein
                    common stocks.  The  Sub-advisor  expects that the majority of the  Portfolio's  assets will be        & Co., LLC
                    invested in the common stocks of large  companies  that appear to be  undervalued.  Among other
                    things, the Portfolio seeks to identify compelling buying opportunities  created when companies
                    are undervalued on the basis of investor  reactions to near-term problems or circumstances even
                    though their long-term  prospects  remain sound. The Sub-advisor  seeks to identify  individual
                    companies with earnings growth potential that may not be recognized by the market at large.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------

- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      STYLE/                                        INVESTMENT OBJECTIVES/POLICIES                                         PORTFOLIO
       TYPE                                                                                                                 ADVISOR/
                                                                                                                          SUB-ADVISOR
                    ------------------------------------------------------------------------------------------------ -----------------------
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   REAL ESTATE      AST Cohen & Steers Realty:  seeks to maximize  total return  through  investment in real estate
     (REIT)         securities.  The  Portfolio  pursues  its  investment  objective  by  investing,  under  normal
                    circumstances,  at least 80% of its net assets in  securities  of real  estate  issuers.  Under
                    normal  circumstances,  the Portfolio will invest substantially all of its assets in the equity
                    securities of real estate companies,  i.e., a company that derives at least 50% of its revenues      Cohen & Steers
                    from the ownership,  construction,  financing, management or sale of real estate or that has at   Capital Management,
                    least  50% of its  assets in real  estate.  Real  estate  companies  may  include  real  estate           Inc.
                    investment trusts or REITs.
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- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    AST Sanford Bernstein Managed Index 500: will invest, under normal circumstances,  at least 80%
                    of its net assets in  securities  included in the Standard & Poor's 500  Composite  Stock Price
                    Index  (the  "S&P(R)500 ").  The  Portfolio  seeks  to  outperform  the S&P 500  through  stock
                    selection  resulting  in  different  weightings  of common  stocks  relative to the index.  The
                    Portfolio will invest  primarily in the common stocks of companies  included in the S&P 500. In
                    seeking  to  outperform  the S&P  500,  the  Sub-advisor  starts  with a  portfolio  of  stocks
  MANAGED INDEX     representative  of the holdings of the index.  It then uses a set of  fundamental  quantitative   Sanford C. Bernstein
                    criteria  that are designed to indicate  whether a particular  stock will  predictably  perform        & Co., LLC
                    better or worse than the S&P 500. Based on these criteria,  the Sub-advisor  determines whether
                    the  Portfolio  should  over-weight,  under-weight  or hold a  neutral  position  in the  stock
                    relative  to the  proportion  of the S&P 500  that  the  stock  represents.  In  addition,  the
                    Sub-advisor  also  may  determine  that  based on the  quantitative  criteria,  certain  equity
                    securities that are not included in the S&P 500 should be held by the Portfolio.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    AST American  Century Income & Growth:  seeks capital growth with current income as a secondary
                    objective.  The Portfolio  invests  primarily in common stocks that offer potential for capital
      GROWTH        growth,  and may,  consistent  with its  investment  objective,  invest  in stocks  that  offer     American Century
       AND          potential for current income.  The  Sub-advisor  utilizes a quantitative  management  technique        Investment
      INCOME        with a goal of building an equity  portfolio  that  provides  better  returns  than the S&P 500     Management, Inc.
                    Index without taking on significant  additional risk and while  attempting to create a dividend
                    yield that will be greater than the S&P 500 Index.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    AST Alliance Growth and Income:  seeks long-term  growth of capital and income while attempting
                    to avoid excessive  fluctuations in market value. The Portfolio  normally will invest in common
      GROWTH        stocks  (and  securities   convertible  into  common  stocks).  The  Sub-advisor  will  take  a
       AND          value-oriented  approach,  in that it will  try to keep  the  Portfolio's  assets  invested  in     Alliance Capital
      INCOME        securities that are selling at reasonable  valuations in relation to their fundamental business     Management, L.P.
                    prospects.  The  stocks  that the  Portfolio  will  normally  invest in are  those of  seasoned
                    companies.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    AST MFS Growth with  Income:  seeks long term growth of capital  with a secondary  objective to
                    seek  reasonable  current  income.  Under normal market  conditions,  the Portfolio  invests at
                    least 65% of its net assets in common stocks and related securities,  such as preferred stocks,
      GROWTH        convertible  securities  and  depositary  receipts.  The stocks in which the Portfolio  invests      Massachusetts
       AND          generally  will pay  dividends.  While the Portfolio  may invest in companies of any size,  the    Financial Services
      INCOME        Portfolio  generally  focuses  on  companies  with  larger  market   capitalizations  that  the         Company
                    Sub-advisor  believes have  sustainable  growth  prospects and attractive  valuations  based on
                    current and  expected  earnings  or cash flow.  The  Portfolio  may invest up to 20% of its net
                    assets in foreign securities.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
  EQUITY INCOME     AST INVESCO Capital Income (f/k/a AST INVESCO Equity Income):  seeks capital growth and current   INVESCO Funds Group,
                    income  while  following  sound  investment  practices.  The  Portfolio  seeks to  achieve  its           Inc.
                    objective by investing in  securities  that are expected to produce  relatively  high levels of
                    income and consistent,  stable returns.  The Portfolio normally will invest at least 65% of its
                    assets in  dividend-paying  common and preferred stocks of domestic and foreign issuers.  Up to
                    30% of the  Portfolio's  assets may be  invested in equity  securities  that do not pay regular
                    dividends.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------

- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      STYLE/                                        INVESTMENT OBJECTIVES/POLICIES                                         PORTFOLIO
       TYPE                                                                                                                 ADVISOR/
                                                                                                                          SUB-ADVISOR
                    ------------------------------------------------------------------------------------------------ -----------------------
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     BALANCED       AST DeAM Global  Allocation:  seeks a high level of total  return by  investing  primarily in a      Deutsche Asset
                    diversified  portfolio  of  mutual  funds.  The  Portfolio  seeks  to  achieve  its  investment     Management, Inc.
                    objective  by  investing  in  several  other  AST  Portfolios  ("Underlying  Portfolios").  The
                    Portfolio intends its strategy of investing in combinations of Underlying  Portfolios to result
                    in  investment  diversification  that an  investor  could  otherwise  achieve  only by  holding
                    numerous  investments.  The  Portfolio  is  expected  to be  invested  in  at  least  six  such
                    Underlying  Portfolios at any time. It is expected that the  investment  objectives of such AST
                    Portfolios will be diversified.
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                    AST  American  Century  Strategic  Balanced:  seeks  capital  growth and  current  income.  The
                    Sub-advisor  intends  to  maintain  approximately  60%  of the  Portfolio's  assets  in  equity
                    securities and the remainder in bonds and other fixed income  securities.  Both the Portfolio's     American Century
     BALANCED       equity and fixed  income  investments  will  fluctuate  in value.  The equity  securities  will        Investment
                    fluctuate  depending on the  performance of the companies that issued them,  general market and     Management, Inc.
                    economic  conditions,  and investor  confidence.  The fixed income investments will be affected
                    primarily by rising or falling interest rates and the credit quality of the issuers.
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ASSET ALLOCATION    AST T. Rowe Price Asset Allocation:  seeks a high level of total return by investing  primarily      T. Rowe Price
                    in a  diversified  portfolio  of fixed income and equity  securities.  The  Portfolio  normally     Associates, Inc.
                    invests  approximately  60% of its total  assets in equity  securities  and 40% in fixed income
                    securities.  The Sub-advisor  concentrates common stock investments in larger, more established
                    companies,  but the  Portfolio may include small and  medium-sized  companies  with good growth
                    prospects.  The fixed income portion of the Portfolio will be allocated among  investment grade
                    securities, high yield or "junk" bonds, foreign high quality debt securities and cash reserves.
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   GLOBAL BOND      AST T. Rowe Price Global  Bond:  seeks to provide  high  current  income and capital  growth by      T. Rowe Price
                    investing  in  high-quality  foreign and U.S.  dollar-denominated  bonds.  The  Portfolio  will   International, Inc.
                    invest at least 80% of its total  assets in all types of high  quality  bonds  including  those
                    issued  or  guaranteed  by U.S.  or  foreign  governments  or  their  agencies  and by  foreign
                    authorities,  provinces and  municipalities  as well as investment  grade  corporate  bonds and
                    mortgage and  asset-backed  securities of U.S. and foreign  issuers.  The  Portfolio  generally
                    invests in countries where the combination of fixed-income  returns and currency exchange rates
                    appears attractive,  or, if the currency trend is unfavorable,  where the Sub-advisor  believes
                    that the currency risk can be minimized  through  hedging.  The Portfolio may also invest up to
                    20% of its assets in the aggregate in below  investment-grade,  high-risk bonds ("junk bonds").
                    In addition,  the  Portfolio may invest up to 30% of its assets in  mortgage-backed  (including
                    derivatives,  such as collateralized mortgage obligations and stripped mortgage securities) and
                    asset-backed securities.
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 HIGH YIELD BOND    AST Federated  High Yield:  seeks high current  income by investing  primarily in a diversified   Federated Investment
                    portfolio of fixed income  securities.  The Portfolio will invest at least 80% of its assets in        Counseling
                    fixed  income  securities  rated BBB and below.  These  fixed  income  securities  may  include
                    preferred  stocks,   convertible  securities,   bonds,   debentures,   notes,  equipment  lease
                    certificates  and equipment trust  certificates.  A fund that invests  primarily in lower-rated
                    fixed  income  securities  will be subject to greater risk and share price  fluctuation  than a
                    typical  fixed income fund,  and may be subject to an amount of risk that is  comparable  to or
                    greater than many equity funds.
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      STYLE/                                        INVESTMENT OBJECTIVES/POLICIES                                         PORTFOLIO
       TYPE                                                                                                                 ADVISOR/
                                                                                                                          SUB-ADVISOR
                    ------------------------------------------------------------------------------------------------ -----------------------
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       BOND         AST Lord Abbett  Bond-Debenture:  seeks high  current  income and the  opportunity  for capital  Lord, Abbett & Co. LLC
                    appreciation  to produce a high total  return.  To pursue its  objective,  the  Portfolio  will
                    invest,  under  normal  circumstances,  at least 80% of the value of its assets in fixed income
                    securities and normally  invests  primarily in high yield and investment grade debt securities,
                    securities  convertible  in common stock and  preferred  stocks.  The  Portfolio  may find good
                    value in high yield  securities,  sometimes  called  "lower-rated  bonds" or "junk  bonds," and
                    frequently  may have more than half of its assets  invested in those  securities.  At least 20%
                    of the  Portfolio's  assets  must be  invested  in any  combination  of  investment  grade debt
                    securities,  U.S.  Government  securities  and cash  equivalents.  The  Portfolio may also make
                    significant  investments  in  mortgage-backed  securities.  Although the  Portfolio  expects to
                    maintain  a  weighted  average  maturity  in the  range of five to twelve  years,  there are no
                    restrictions  on the overall  Portfolio or on individual  securities.  The Portfolio may invest
                    up to 20% of its net assets in equity securities.
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                    AST DeAM Bond:  seeks a high level of income,  consistent  with the  preservation  of  capital.
                    Under  normal  circumstances,  the  Portfolio  invests  at least  80% of its  total  assets  in
                    intermediate-term  U.S.  Treasury,   corporate,   mortgage-backed  and  asset-backed,   taxable
       BOND         municipal and tax-exempt  municipal bonds. The Portfolio  invests primarily in investment grade      Deutsche Asset
                    fixed  income  securities  rated  within  the  top  three  rating  categories  of a  nationally     Management, Inc.
                    recognized  rating  organization.  Fixed  income  securities  may be issued by U.S. and foreign
                    corporations or entities including banks and various government entities.
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       BOND         AST PIMCO Total Return Bond:  seeks to maximize total return  consistent  with  preservation of    Pacific Investment
                    capital  and  prudent  investment  management.  The  Portfolio  will  invest  in a  diversified  Management Company LLC
                    portfolio of fixed-income  securities of varying maturities.  The average portfolio duration of
                    the  Portfolio  generally  will  vary  within a three-  to  six-year  time  frame  based on the
                    Sub-advisor's forecast for interest rates.
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       BOND         AST PIMCO Limited  Maturity Bond: seeks to maximize total return  consistent with  preservation
                    of capital  and prudent  investment  management.  The  Portfolio  will invest in a  diversified
                    portfolio of fixed-income  securities of varying maturities.  The average portfolio duration of
                    the  Portfolio  generally  will  vary  within  a one- to  three-year  time  frame  based on the    Pacific Investment
                    Sub-advisor's forecast for interest rates.                                                       Management Company LLC
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   MONEY MARKET     AST Money  Market:  seeks high  current  income and  maintain  high  levels of  liquidity.  The      Wells Capital
                    Portfolio  attempts to  accomplish  its  objective by  maintaining  a  dollar-weighted  average     Management, Inc.
                    maturity  of not  more  than 90 days  and by  investing  in  securities  which  have  effective
                    maturities of not more than 397 days.
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 EMERGING MARKETS   Gartmore Variable Investment Trust - Developing Markets:  seeks long-term capital appreciation,
                    under  normal  conditions  by investing at least 80% of its total assets in stocks of companies  Gartmore Global Asset
                    of any size  based  in the  world's  developing  economies.  Under  normal  market  conditions,        Management
                    investments  are  maintained  in at least  six  countries  at all times and no more than 35% of  Trust/Gartmore Global
                    total assets in any single one of them.                                                                 Partners
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  MID-CAP EQUITY    INVESCO Variable  Investment  Funds - Dynamics:  seek long-term  capital growth.  The Portfolio   INVESCO Funds Group,
                    invests at least 65% of its assets in common  stocks of mid-sized  companies.  INVESCO  defines           Inc.
                    mid-sized  companies as companies  that are included in the Russell  Midcap Growth Index at the
                    time of purchase,  or if not  included in that Index,  have market  capitalizations  of between
                    $2.5 billion and $15 billion at the time of purchase.  The core of the Portfolio's  investments
                    are in securities of established  companies that are leaders in attractive  growth markets with
                    a history of strong  returns.  The  remainder  of the  Portfolio is invested in  securities  of
                    companies  that show  accelerating  growth,  driven by product  cycles,  favorable  industry or
                    sector  conditions,  and other  factors  that  INVESCO  believes  will  lead to rapid  sales or
                    earnings growth.
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- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      STYLE/                                        INVESTMENT OBJECTIVES/POLICIES                                         PORTFOLIO
       TYPE                                                                                                                 ADVISOR/
                                                                                                                          SUB-ADVISOR
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      SECTOR        INVESCO Variable  Investment Funds - Technology:  seeks capital growth.  The Portfolio normally   INVESCO Funds Group,
                    invests  80% of its net assets in the  equity  securities  and  equity-related  instruments  of           Inc.
                    companies  engaged in  technology-related  industries.  These include,  but are not limited to,
                    various applied technologies, hardware, software, semiconductors,  telecommunications equipment
                    and services and service-related  companies in information  technology.  Many of these products
                    and services are subject to rapid obsolescence,  which may lower market value of the securities
                    of the  companies  in this  sector.  At any given time,  20% of the  Portfolio's  assets is not
                    required to be invested in the sector.
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      SECTOR        INVESCO  Variable  Investment  Funds - Health  Sciences:  seeks capital  growth.  The Portfolio   INVESCO Funds Group,
                    normally  invests at least 80% of its net assets in the equity  securities  and  equity-related           Inc.
                    instruments of companies that develop,  produce or distribute  products or services  related to
                    health care. These companies  include,  but are not limited to, medical  equipment or supplies,
                    pharmaceuticals,  biotechnology and healthcare  providers and service  companies.  At any given
                    time, 20% of the Portfolio's assets is not required to be invested in the sector.
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      SECTOR        INVESCO Variable  Investment Funds - Financial  Services:  seeks capital growth.  The Portfolio   INVESCO Funds Group,
                    normally  invests at least 80% of its net assets in the equity  securities  and  equity-related           Inc.
                    instruments of companies  involved in the financial  services sector.  These companies include,
                    but are not  limited  to,  banks  (regional  and  money-centers),  insurance  companies  (life,
                    property  and  casualty,  and  multiline),   investment  and  miscellaneous  industries  (asset
                    managers,  brokerage  firms,  and  government-sponsored  agencies)  and  suppliers to financial
                    services  companies.  At any given time,  20% of the  Portfolio's  assets is not required to be
                    invested in the sector.
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      SECTOR        INVESCO  Variable  Investment  Funds -  Telecommunications:  seeks  capital  growth and current   INVESCO Funds Group,
                    income.  The  Portfolio  normally  invests 80% of its net assets in the equity  securities  and           Inc.
                    equity-related  instruments  of  companies  engaged in the  design,  development,  manufacture,
                    distribution,  or sale of  communications  services  and  equipment,  and  companies  that  are
                    involved in supplying equipment or services to such companies.  The  telecommunications  sector
                    includes,   but  is  not  limited  to,  companies  that  offer  telephone  services,   wireless
                    communications,  satellite communications,  television and movie programming,  broadcasting and
                    Internet access. Many of these products and services are subject to rapid  obsolescence,  which
                    may lower the market value of the  securities  of the  companies  in this sector.  At any given
                    time, 20% of the Portfolio's assets is not required to be invested in the sector.
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  INTERNATIONAL     Evergreen VA  International  Equity  (acquired  Evergreen VA Global  Leaders):  seeks long-term   Evergreen Investment
      EQUITY        capital growth and,  secondarily,  modest  income.  The Portfolio  invests  primarily in equity   Management Company,
                    securities  issued by  established,  quality,  non-U.S.  companies  located in  countries  with           LLC
                    developed markets, but may purchase across all market  capitalizations.  The Portfolio normally
                    invests at least 65% of its assets in  securities  of  companies  in at least  three  different
                    countries  (other than the U.S.),  but may invest  more than 25% of its assets in one  country.
                    The Portfolio also invests in emerging markets.
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- -------------------
 SMALL CAP EQUITY   Evergreen VA Special Equity:  seeks capital  growth.  The Portfolio  normally  invests at least   Evergreen Investment
                    80% of its assets in common  stocks of small  U.S.  companies  (i.e.,  companies  whose  market   Management Company,
                    capitalizations  fall within the range of the Russell  2000(R)Index,  at the time of  purchase).          LLC
                    The remaining 20% of the  Portfolio's  assets may be represented by cash or invested in various
                    cash  equivalents.  The Portfolio's  manager selects stocks of companies which it believes have
                    the potential for accelerated growth in earnings and price.
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  MID-CAP EQUITY    Evergreen VA Omega:  seeks long-term capital growth.  The Portfolio invests primarily in common   Evergreen Investment
                    stocks and  securities  convertible  into  common  stocks of U.S.  companies  across all market   Management Company,
                    capitalizations.  The  Portfolio's  managers  employ  a  growth  style  of  equity  management.          LLC
                    "Growth" stocks are stocks of companies that the Portfolio's  managers believe have anticipated
                    earnings ranging from steady to accelerated growth.
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      STYLE/                                        INVESTMENT OBJECTIVES/POLICIES                                         PORTFOLIO
       TYPE                                                                                                                 ADVISOR/
                                                                                                                          SUB-ADVISOR
                    ------------------------------------------------------------------------------------------------ -----------------------

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  INTERNATIONAL     ProFund  VP  Europe  30:  seeks  daily  investment  results,  before  fees and  expenses,  that   ProFund Advisors LLC
      EQUITY        correspond to the daily  performance of the ProFunds  Europe 30 Index.  The ProFunds  Europe 30
                    Index,  created by ProFund  Advisors,  is composed of 30 companies whose principal  offices are
                    located  in Europe  and whose  securities  are  traded on U.S.  exchanges  or on the  NASDAQ as
                    depositary  receipts or ordinary  shares.  The  component  companies in the ProFunds  Europe 30
                    Index are  determined  annually  based upon their U.S.  dollar-traded  volume.  Their  relative
                    weights are determined based on a modified market capitalization method.
                    ------------------------------------------------------------------------------------------------ -----------------------
                    ------------------------------------------------------------------------------------------------ -----------------------

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  INTERNATIONAL     ProFund VP Asia 30: seeks daily investment results,  before fees and expenses,  that correspond   ProFund Advisors LLC
      EQUITY        to the daily  performance  of the ProFunds Asia 30 Index.  The ProFunds Asia 30 Index,  created
                    by ProFund Advisors,  is composed of 30 of the companies whose principal offices are located in
                    the Asia/Pacific region,  excluding Japan, and whose securities are traded on U.S. exchanges or
                    on the NASDAQ as  depository  receipts or  ordinary  shares.  The  component  companies  in the
                    ProFunds Asia 30 Index are  determined  annually  based upon their U.S.  dollar-traded  volume.
                    Their relative weights are determined based on the modified market capitalization method.
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                    ProFund VP Japan: seeks daily investment results,  before fees and expenses, that correspond to
                    the daily  performance  of the Nikkei 225 Stock  Average.  Since the  Japanese  markets are not
                    open when  ProFund VP Japan  values its  shares,  ProFund VP Japan  determines  its  success in
  INTERNATIONAL     meeting this  investment  objective by comparing its daily return on a given day with the daily   ProFund Advisors LLC
      EQUITY        performance of related  futures  contracts  traded in the United  States.  The Nikkei 225 Stock
                    Average is a price-weighted  index of 225 large,  actively traded Japanese stocks traded on the
                    Tokyo Stock Exchange.  The Index is computed and distributed by the Nihon Keizai Shimbun.
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      SECTOR        ProFund VP Banks: seeks daily investment results,  before fees and expenses, that correspond to   ProFund Advisors LLC
                    the daily  performance  of the Dow Jones U.S.  Banks  Sector  Index.  The Dow Jones U.S.  Banks
                    Index measures the  performance of the banking  industry of the U.S.  equity market.  Component
                    companies  include all  regional  and major U.S.  domiciled  international  banks,  savings and
                    loans, savings banks,  thrifts,  building  associations and societies.  Investment and merchant
                    banks are excluded.
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                    ProFund VP Basic Materials:  seeks daily  investment  results,  before fees and expenses,  that
                    correspond to the daily  performance of the Dow Jones U.S. Basic  Materials  Sector Index.  The
                    Dow Jones U.S. Basic  Materials  Sector Index measures the  performance of the basic  materials
      SECTOR        economic sector of the U.S. equity market.  Component  companies are involved in the production   ProFund Advisors LLC
                    of aluminum,  commodity chemicals,  specialty chemicals,  forest products,  non-ferrous metals,
                    paper products, precious metals and steel.
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                    ProFund VP  Biotechnology:  seeks daily  investment  results,  before fees and  expenses,  that
                    correspond to the daily  performance of the Dow Jones U.S.  Biotechnology  Index. The Dow Jones
                    U.S.  Biotechnology  Index measures the performance of the  biotechnology  industry of the U.S.
      SECTOR        equity  market.  Component  companies  include  those engaged in genetic  research,  and/or the   ProFund Advisors LLC
                    marketing  and  development  of  recombinant  DNA  products.  Makers  of  artificial  blood and
                    contract biotechnology researchers are also included in the Index.
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      SECTOR        ProFund VP Consumer Cyclical:  seeks daily investment results,  before fees and expenses,  that   ProFund Advisors LLC
                    correspond to the daily  performance of the Dow Jones U.S.  Consumer Cyclical Sector Index. The
                    Dow Jones U.S.  Consumer  Cyclical  Sector  Index  measures  the  performance  of the  consumer
                    cyclical  economic  sector of the U.S. equity market.  Component  companies  include  airlines,
                    auto manufacturers,  auto parts, tires, casinos,  consumer  electronics,  recreational products
                    and services,  restaurants,  lodging, toys, home construction, home furnishings and appliances,
                    footwear, clothing and fabrics.
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      STYLE/                                        INVESTMENT OBJECTIVES/POLICIES                                         PORTFOLIO
       TYPE                                                                                                                 ADVISOR/
                                                                                                                          SUB-ADVISOR
                    ------------------------------------------------------------------------------------------------ -----------------------
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      SECTOR        ProFund VP Consumer  Non-Cyclical:  seeks daily investment  results,  before fees and expenses,   ProFund Advisors LLC
                    that correspond to the daily  performance of the Dow Jones U.S.  Consumer  Non-Cyclical  Sector
                    Index. The Dow Jones U.S.  Consumer  Non-Cyclical  Sector Index measures the performance of the
                    consumer  non-cyclical  economic sector of the U.S. equity market.  Component companies include
                    beverage  companies,  consumer service  companies,  durable and non-durable  household  product
                    manufacturers, cosmetic companies, food products and agriculture and tobacco products.
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      SECTOR        ProFund VP Energy:  seeks daily investment results,  before fees and expenses,  that correspond   ProFund Advisors LLC
                    to the daily  performance of the Dow Jones U.S. Energy Sector Index.  The Dow Jones U.S. Energy
                    Sector  Index  measures  the  performance  of the  energy  sector  of the U.S.  equity  market.
                    Component  companies include oil drilling  equipment and services,  coal, oil  companies-major,
                    oil companies-secondary,  pipelines, liquid, solid or gaseous fossil fuel producers and service
                    companies.
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      SECTOR        ProFund  VP  Financial:  seeks  daily  investment  results,  before  fees  and  expenses,  that   ProFund Advisors LLC
                    correspond to the daily  performance  of the Dow Jones U.S.  Financial  Sector  Index.  The Dow
                    Jones U.S.  Financial Sector Index measures the performance of the financial  services economic
                    sector of the U.S.  equity market.  Component  companies  include  regional  banks,  major U.S.
                    domiciled  international banks, full line, life, and property and casualty insurance companies,
                    companies that invest,  directly or indirectly in real estate,  diversified financial companies
                    such  as  Fannie  Mae,  credit  card  insurers,  check  cashing  companies,  mortgage  lenders,
                    investment  advisers and securities  broker-dealers,  investment banks,  merchant banks, online
                    brokers, publicly traded stock exchanges.
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                    ------------------------------------------------------------------------------------------------ -----------------------
      SECTOR        ProFund  VP  Healthcare:  seeks  daily  investment  results,  before  fees and  expenses,  that   ProFund Advisors LLC
                    correspond to the daily  performance of the Dow Jones U.S.  Healthcare  Sector Index.  The Down
                    Jones U.S.  Healthcare Sector Index measures the performance of the healthcare  economic sector
                    of the U.S. equity market.  Component  companies  include health care providers,  biotechnology
                    companies, medical supplies, advanced medical devices and pharmaceuticals.
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      SECTOR        ProFund  VP  Industrial:  seeks  daily  investment  results,  before  fees and  expenses,  that   ProFund Advisors LLC
                    correspond to the daily  performance  of the Dow Jones U.S.  Industrial  Sector Index.  The Dow
                    Jones U.S.  Industrial Sector Index measures the performance of the industrial  economic sector
                    of  the  U.S.  equity  market.   Component   companies   include  building   materials,   heavy
                    construction,  factory  equipment,  heavy machinery,  industrial  services,  pollution control,
                    containers  and  packaging,   industrial  diversified,   air  freight,  marine  transportation,
                    railroads,  trucking,  land-transportation  equipment,  shipbuilding,  transportation services,
                    advanced industrial equipment, electric components and equipment, and aerospace.
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                    ------------------------------------------------------------------------------------------------ -----------------------
      SECTOR        ProFund VP Internet:  seeks daily investment results, before fees and expenses, that correspond   ProFund Advisors LLC
                    to the daily  performance  of the Dow  Jones  U.S.  Internet  Index.  The Dow  Jones  Composite
                    Internet Index measures the  performance of stocks in the U.S. equity markets that generate the
                    majority  of their  revenues  from the  Internet.  The  Index is  composed  of two  sub-groups:
                    Internet  Commerce - companies that derive the majority of their revenues from providing  goods
                    and/or services through an open network,  such as a web site; and Internet Services - companies
                    that derive the majority of their revenues from  providing  access to the Internet or providing
                    services to people using the Internet.
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      SECTOR        ProFund VP  Pharmaceuticals:  seeks daily investment  results,  before fees and expenses,  that   ProFund Advisors LLC
                    correspond to the daily  performance of the Dow Jones U.S.  Pharmaceuticals  Sector Index.  The
                    Dow Jones U.S.  Pharmaceuticals Index measures the performance of the pharmaceuticals  industry
                    of the U.S.  equity  market.  Component  companies  include  the  makers  of  prescription  and
                    over-the-counter  drugs, such as aspirin, cold remedies,  birth control pills, and vaccines, as
                    well as companies engaged in contract drug research.
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      STYLE/                                        INVESTMENT OBJECTIVES/POLICIES                                         PORTFOLIO
       TYPE                                                                                                                 ADVISOR/
                                                                                                                          SUB-ADVISOR
                    ------------------------------------------------------------------------------------------------ -----------------------
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      SECTOR        ProFund VP Precious Metals:  seeks daily  investment  results,  before fees and expenses,  that   ProFund Advisors LLC
                    correspond to the daily  performance  of the  Philadelphia  Stock Exchange Gold & Silver Sector
                    Index.  The  Philadelphia  Stock Exchange Gold and Silver Sector Index measures the performance
                    of the gold and  silver  mining  industry  of the global  equity  market.  Component  companies
                    include  companies  involved in the mining and production of gold,  silver,  and other precious
                    metals,  precious  stones and pearls.  The Index does not include  producers  of  commemorative
                    medals and coins that are made of these metals.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    ------------------------------------------------------------------------------------------------ -----------------------
      SECTOR        ProFund VP Real  Estate:  seeks  daily  investment  results,  before  fees and  expenses,  that   ProFund Advisors LLC
                    correspond to the daily  performance  of the Dow Jones U.S.  Real Estate  Index.  The Dow Jones
                    U.S. Real Estate Index measures the  performance of the real estate industry of the U.S. equity
                    market.   Component  companies  include  those  that  invest  directly  or  indirectly  through
                    development,   management  or  ownership  of  shopping  malls,  apartment  buildings,   housing
                    developments  and, real estate  investment  trusts ("REITs") that invest in apartments,  office
                    and  retail  properties.  REITs are  passive  investment  vehicles  that  invest  primarily  in
                    income-producing real estate or real estate related loans or interests.
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      SECTOR        ProFund VP  Semiconductor:  seeks daily  investment  results,  before fees and  expenses,  that   ProFund Advisors LLC
                    correspond to the daily  performance of the Dow Jones U.S.  Semiconductor  Index. The Dow Jones
                    U.S.  Semiconductor  Index measures the performance of the  semiconductor  industry of the U.S.
                    equity market.  Component  companies are engaged in the production of semiconductors  and other
                    integrated chips, as well as other related products such as circuit boards and motherboards.
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                    ------------------------------------------------------------------------------------------------ -----------------------
      SECTOR        ProFund  VP  Technology:  seeks  daily  investment  results,  before  fees and  expenses,  that   ProFund Advisors LLC
                    correspond to the daily  performance  of the Dow Jones U.S.  Technology  Sector Index.  The Dow
                    Jones U.S.  Technology  Sector Index measures the  performance of the technology  sector of the
                    U.S.  equity  market.  Component  companies  include  those  involved in  computers  and office
                    equipment,  software,   communications  technology,   semiconductors,   diversified  technology
                    services and internet services.
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- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      SECTOR        ProFund VP Telecommunications:  seeks daily investment results,  before fees and expenses, that   ProFund Advisors LLC
                    correspond to the daily performance of the Dow Jones U.S.  Telecommunications Sector Index. The
                    Dow  Jones  U.S.   Telecommunications   Sector   Index   measures   the   performance   of  the
                    telecommunications  economic  sector of the U.S.  equity market.  Component  companies  include
                    fixed line communications and wireless communications companies.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    ProFund  VP  Utilities:  seeks  daily  investment  results,  before  fees  and  expenses,  that
                    correspond to the daily  performance  of the Dow Jones U.S.  Utilities  Sector  Index.  The Dow
      SECTOR        Jones U.S.  Utilities Sector Index measures the performance of the utilities economic sector of   ProFund Advisors LLC
                    the U.S. equity market.  Component  companies  include  electric  utilities,  gas utilities and
                    water utilities.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- --------------------------------------------------------------------------------------------------------------------------------------------
THE PROFUND VP PORTFOLIOS  DESCRIBED  BELOW ARE AVAILABLE AS  SUB-ACCOUNTS  TO ALL ANNUITY  OWNERS.  EACH  PORTFOLIO  PURSUES AN INVESTMENT
STRATEGY THAT SEEKS TO PROVIDE DAILY  INVESTMENT  RESULTS,  BEFORE FEES AND EXPENSES,  THAT MATCH A WIDELY FOLLOWED  INDEX,  INCREASED BY A
SPECIFIED FACTOR RELATIVE TO THE INDEX,  MATCH THE INVERSE OF THE INDEX OR THE INVERSE OF THE INDEX MULTIPLIED BY A SPECIFIED  FACTOR.  THE
INVESTMENT  STRATEGY OF SOME OF THE PORTFOLIOS MAY MAGNIFY (BOTH POSITIVELY AND NEGATIVELY) THE DAILY INVESTMENT  RESULTS OF THE APPLICABLE
INDEX.  IT IS RECOMMENDED  THAT ONLY THOSE ANNUITY OWNERS WHO ENGAGE A FINANCIAL  ADVISOR TO ALLOCATE THEIR ACCOUNT VALUE USING A STRATEGIC
OR TACTICAL  ASSET  ALLOCATION  STRATEGY  INVEST IN THESE  PORTFOLIOS.  WE HAVE  ARRANGED  THE  PORTFOLIOS  BASED ON THE INDEX ON WHICH ITS
INVESTMENT STRATEGY IS BASED.
- --------------------------------------------------------------------------------------------------------------------------------------------

- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      STYLE/                                        INVESTMENT OBJECTIVES/POLICIES                                         PORTFOLIO
       TYPE                                                                                                                 ADVISOR/
                                                                                                                          SUB-ADVISOR
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- --------------------------------------------------------------------------------------------------------------------------------------------
The S&P 500 Index(R)is a widely used measure of large-cap  U.S. stock market  performance.  It includes a  representative  sample of leading
companies in leading  industries.  Companies  are selected for inclusion in the Index by Standard & Poor's(R)for being U.S.  companies  with
adequate liquidity, appropriate market capitalization financial viability and public float.
- --------------------------------------------------------------------------------------------------------------------------------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    ProFund VP Bull: seeks daily investment results,  before fees and expenses,  that correspond to   ProFund Advisors LLC
     S&P 500        the daily performance of the S&P 500(R)Index.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    ProFund VP Bear: seeks daily investment results,  before fees and expenses,  that correspond to
                    the inverse  (opposite) of the daily  performance of the S&P 500(R)Index.  If ProFund VP Bear is
                    successful in meeting its objective,  its net asset value should gain  approximately  the same,
     S&P 500        on a  percentage  basis,  as any  decrease  in the S&P 500(R)Index when the Index  declines on a   ProFund Advisors LLC
                    given  day.  Conversely,  its  net  asset  value  should  lose  approximately  the  same,  on a
                    percentage basis, as any increase in the Index when the Index rises on a given day.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    ProFund VP UltraBull (f/k/a ProFund VP Bull Plus): seeks daily investment results,  before fees
                    and expenses,  that correspond to twice (200%) the daily  performance of the S&P 500(R)Index. If
                    the ProFund VP UltraBull is  successful  in meeting its  objective,  its net asset value should
                    gain  approximately  twice as much, on a percentage basis, as the S&P 500(R)Index when the Index
     S&P 500        rises on a given day.  Conversely,  its net asset  value  should  lose  approximately  twice as   ProFund Advisors LLC
                    much,  on a percentage  basis,  as the Index when the Index  declines on a given day.  Prior to
                    May 1, 2003,  ProFund VP UltraBull was named "ProFund VP Bull Plus" and sought daily investment
                    results that corresponded to one and one-half times the daily performance of the S&P 500(R)Index
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- --------------------------------------------------------------------------------------------------------------------------------------------
The NASDAQ-100 Index(R)is a market capitalization  weighted index that includes 100 of the largest domestic and international  non-financial
companies listed on The NASDAQ Stock Market.
- --------------------------------------------------------------------------------------------------------------------------------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
    NASDAQ 100      ProFund VP OTC: seeks daily investment  results,  before fees and expenses,  that correspond to   ProFund Advisors LLC
                    the daily performance of the NASDAQ-100  Index(R).  "OTC" in the name of ProFund VP OTC refers to
                    securities that do not trade on a U.S. securities exchange,  as registered under the Securities
                    Exchange Act of 1934.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
    NASDAQ 100      ProFund  VP  Short  OTC:  seeks  daily  investment  results,  before  fees and  expenses,  that   ProFund Advisors LLC
                    correspond to the inverse  (opposite) of the daily  performance  of the NASDAQ-100  Index(R).  If
                    ProFund VP Short OTC is  successful in meeting its  objective,  its net asset value should gain
                    approximately  the same, on a percentage  basis, as any decrease in the NASDAQ-100  Index(R)when
                    the Index declines on a given day.  Conversely,  its net asset value should lose  approximately
                    the same, on a percentage  basis,  as any increase in the Index when the Index rises on a given
                    day.  "OTC" in the name of  ProFund VP Short OTC  refers to  securities  that do not trade on a
                    U.S. securities exchange, as registered under the Securities Exchange Act of 1934.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
    NASDAQ 100      ProFund VP UltraOTC:  seeks daily investment results, before fees and expenses, that correspond   ProFund Advisors LLC
                    to twice  (200%) the daily  performance  of the  NASDAQ-100  Index(R).  If ProFund VP UltraOTC is
                    successful in meeting its  objective,  its net asset value should gain  approximately  twice as
                    much,  on a percentage  basis,  as the  NASDAQ-100  Index(R)when the Index rises on a given day.
                    Conversely,  its net asset  value  should lose  approximately  twice as much,  on a  percentage
                    basis,  as the Index when the Index  declines  on a given day.  "OTC" in the name of ProFund VP
                    UltraOTC refers to securities that do not trade on a U.S.  securities  exchange,  as registered
                    under the Securities Exchange Act of 1934.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------

- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      STYLE/                                        INVESTMENT OBJECTIVES/POLICIES                                         PORTFOLIO
       TYPE                                                                                                                 ADVISOR/
                                                                                                                          SUB-ADVISOR
                    ------------------------------------------------------------------------------------------------ -----------------------
- --------------------------------------------------------------------------------------------------------------------------------------------
The S&P MidCap 400 Index(R)is a widely used  measure of  mid-sized  company  U.S.  stock  market  performance.  Companies  are  selected for
inclusion  in the Index by  Standard & Poor's(R)for being U.S.  companies  with  adequate  liquidity,  appropriate  market  capitalization,
financial viability and public float.
- --------------------------------------------------------------------------------------------------------------------------------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
  S&P MIDCAP 400    ProFund VP Mid-Cap  Value:  seeks daily  investment  results,  before fees and  expenses,  that   ProFund Advisors LLC
                    correspond  to the  daily  performance  of the  S&P  MidCap  400/Barra  Value  Index(R).  The S&P
                    MidCap400/Barra  Value Index(R)is designed to differentiate  between fast growing  companies and
                    slower  growing or  undervalued  companies.  Standard & Poor's and Barra  cooperate to employ a
                    price-to-book value calculation whereby the market  capitalization of the S&P MidCap 400 Index(R)
                    is divided equally between growth and value.  The index is rebalanced twice per year.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    ProFund VP Mid-Cap  Growth:  seeks daily  investment  results,  before fees and expenses,  that
                    correspond to the daily  performance of the S&P MidCap 400/Barra Growth Index(R).  The S&P MidCap
                    400/Barra Growth Index(R)is designed to differentiate  between fast growing companies and slower
  S&P MIDCAP 400    growing  or  undervalued  companies.  Standard  &  Poor's  and  Barra  cooperate  to  employ  a   ProFund Advisors LLC
                    price-to-book value calculation whereby the market  capitalization of the S&P MidCap 400 Index(R)
                    is divided equally between growth and value.  The Index is rebalanced twice per year.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    ProFund VP  UltraMid-Cap:  seeks  daily  investment  results,  before fees and  expenses,  that
                    correspond to twice (200%) the daily  performance  of the S&P MidCap 400 Index(R).  If ProFund VP
                    UltraMid-Cap  is  successful  in  meeting  its  objective,  its net  asset  value  should  gain
  S&P MIDCAP 400    approximately  twice as much,  on a  percentage  basis,  as the S&P MidCap 400 Index(R)when the   ProFund Advisors LLC
                    Index rises on a given day.  Conversely,  its net asset value should lose  approximately  twice
                    as much, on a percentage basis, as the Index when the Index declines on a given day.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- --------------------------------------------------------------------------------------------------------------------------------------------
The S&P SmallCap 600 Index(R)consists of 600 domestic  stocks chosen for market size,  liquidity,  and industry group  representation.  The
Index comprises stocks from the industrial, utility, financial, and transportation sectors.
- --------------------------------------------------------------------------------------------------------------------------------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
 S&P SMALLCAP 600   ProFund VP Small-Cap Value:  seeks daily  investment  results,  before fees and expenses,  that   ProFund Advisors LLC
                    correspond  to the daily  performance  of the S&P  SmallCap  600/Barra  Value  Index(R).  The S&P
                    SmallCap  600/Barra Value Index(R)is designed to  differentiate  between fast growing  companies
                    and slower growing or undervalued  companies.  Standard & Poor's and Barra  cooperate to employ
                    a price-to-book  value  calculation  whereby the market  capitalization of the S&P SmallCap 600
                    Index(R)is divided equally between growth and value.  The Index is rebalanced twice per year.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
 S&P SMALLCAP 600   ProFund VP Small-Cap Growth:  seeks daily investment  results,  before fees and expenses,  that   ProFund Advisors LLC
                    correspond  to the daily  performance  of the S&P SmallCap  600/Barra  Growth  Index(R).  The S&P
                    SmallCap  600/Barra Growth Index(R)is designed to differentiate  between fast growing  companies
                    and slower growing or undervalued  companies.  Standard & Poor's and Barra  cooperate to employ
                    a price-to-book  value  calculation  whereby the market  capitalization of the S&P SmallCap 600
                    Index(R)is divided equally between growth and value.  The Index is rebalanced twice per year.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- --------------------------------------------------------------------------------------------------------------------------------------------
The Russell 2000 Index(R)measures the performance of the 2,000 small companies in the Russell 3000 Index(R)representing  approximately 8% of
the total market  capitalization  of the Russell 3000 Index(R),  which in turn  represents  approximately  98% of the investable  U.S. equity
market.
- --------------------------------------------------------------------------------------------------------------------------------------------
- --------------------- ------------------------------------------------------------------------------------------------ ---------------------
    RUSSELL 2000      ProFund VP  UltraSmall-Cap:  seeks daily  investment  results,  before fees and expenses,  that  ProFund Advisors LLC
                      correspond  to twice (200%) the daily  performance  of the Russell  2000(R)Index.  If ProFund VP
                      UltraSmall-Cap  is  successful  in meeting  its  objective,  its net asset  value  should  gain
                      approximately  twice as much, on a percentage  basis, as the Russell 2000 Index(R)when the Index
                      rises on a given day.  Conversely,  its net asset  value  should  lose  approximately  twice as
                      much, on a percentage basis, as the Index when the Index declines on a given day.
- --------------------- ------------------------------------------------------------------------------------------------ ---------------------

- --------------------- ---------------------------------------------------------------------------------------------- -----------------------
       STYLE/                                        INVESTMENT OBJECTIVES/POLICIES                                        PORTFOLIO
        TYPE                                                                                                                ADVISOR/
                                                                                                                          SUB-ADVISOR
- --------------------- ---------------------------------------------------------------------------------------------- -----------------------
- --------------------- ---------------------------------------------------------------------------------------------- -----------------------
  U.S. GOV'T BOND     ProFund VP U.S.  Government Plus: seeks daily investment  results,  before fees and expenses,   ProFund Advisors LLC
                      that  correspond  to one and  one-quarter  times (125%) the daily price  movement of the most
                      recently  issued  30-year U.S.  Treasury Bond ("Long  Bond").  In accordance  with its stated
                      objective,  the net asset value of ProFund VP U.S.  Government Plus generally should decrease
                      as interest  rates rise.  If ProFund VP U.S.  Government  Plus is  successful  in meeting its
                      objective,  its net asset value should gain approximately one and one-quarter times (125%) as
                      much,  on a  percentage  basis,  as any  daily  increase  in the  Long  Bond on a given  day.
                      Conversely,  its net asset value  should lose  approximately  one and  one-quarter  (125%) as
                      much, on a percentage basis, as any daily decrease in the Long Bond on a given day.
- --------------------- ---------------------------------------------------------------------------------------------- -----------------------
                      ---------------------------------------------------------------------------------------------- -----------------------
  U.S. GOV'T BOND     ProFund  VP Rising  Rates  Opportunity:  seeks  daily  investment  results,  before  fees and   ProFund Advisors LLC
                      expenses,  that correspond to one and one-quarter times (125%) the inverse  (opposite) of the
                      daily price  movement of the most recently  issued Long Bond.  In accordance  with its stated
                      objective,  the net asset  value of  ProFund VP rising  Rates  Opportunity  generally  should
                      decrease as interest  rates fall.  If ProFund VP Rising Rates  Opportunity  is  successful in
                      meeting its  objective,  its net asset value should gain  approximately  one and  one-quarter
                      times (125%) as much,  on a  percentage  basis,  as any daily  decrease in the Long Bond on a
                      given day.  Conversely,  its net asset value should lose  approximately  one and  one-quarter
                      times (125%) as much,  on a  percentage  basis,  as any daily  increase in the Long Bond on a
                      given day.
- --------------------- ---------------------------------------------------------------------------------------------- -----------------------
- --------------------------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------------------------

Each  portfolio of the First Defined  Portfolio Fund LLC invests in the securities of a relatively few number of issuers or in a particular
sector of the economy.  Since the assets of each  portfolio are invested in a limited number of issuers or a limited sector of the economy,
the net asset value of the portfolio may be more susceptible to a single adverse economic,  political or regulatory occurrence.  Certain of
the  portfolios  may also be subject to  additional  market risk due to their  policy of  investing  based on an  investment  strategy  and
generally not buying or selling  securities in response to market  fluctuations.  Each  portfolio's  relative lack of diversity and limited
ongoing management may subject Owners to greater market risk than other portfolios.

The stock selection date for each of the strategy  Portfolios of the First Defined  Portfolio Fund LLC is on or about December 31st of each
year. The holdings for each strategy  Portfolio  will be adjusted  annually on or about  December 31st in accordance  with the  Portfolio's
investment  strategy.  At that time,  the  percentage  relationship  among the shares of each issuer held by the Portfolio is  established.
Through the next one-year  period that  percentage  will be  maintained  as closely as  practicable  when the  Portfolio  makes  subsequent
purchases and sales of the securities.
- --------------------------------------------------------------------------------------------------------------------------------------------
- --------------------- ---------------------------------------------------------------------------------------------- -----------------------
     LARGE CAP        First Trust(R)10 Uncommon Values: seeks to provide  above-average  capital  appreciation.  The   First Trust Advisors
       BLEND          Portfolio  seeks to achieve its  objective  by investing  primarily in the ten common  stocks           L.P.
                      selected by the Investment Policy Committee of Lehman Brothers Inc. ("Lehman  Brothers") with
                      the assistance of the Research  Department of Lehman  Brothers  which,  in their opinion have
                      the greatest  potential for capital  appreciation  during the next year. The stocks  included
                      in the  Portfolio  are  adjusted  annually  on or  about  July  1st in  accordance  with  the
                      selections of Lehman Brothers.
- --------------------- ---------------------------------------------------------------------------------------------- -----------------------
                      ---------------------------------------------------------------------------------------------- -----------------------
                      The  Prudential  Series  Fund,  Inc. - SP  Jennison  International  Growth:  seeks to provide
                      long-term  growth  of  capital.   The  Portfolio   pursues  its  objective  by  investing  in
                      equity-related  securities of foreign issuers that the Sub-advisor  believes will increase in
                      value over a period of years.  The Portfolio  invests  primarily in the common stock of large
                      and medium-sized  foreign  companies.  Under normal  circumstances,  the Portfolio invests at
      INTER-          least 65% of its total assets in common stock of foreign  companies  operating or based in at
  NATIONAL EQUITY     least five different  countries.  The Portfolio looks primarily for stocks of companies whose        Prudential
                      earnings  are  growing at a faster  rate than  other  companies  and that have  above-average     Investments LLC/
                      growth in earnings and cash flow, improving profitability,  strong balance sheets, management   Jennison Associates
                      strength  and strong  market share for its  products.  The  Portfolio  also tries to buy such           LLC
                      stocks at attractive prices in relation to their growth prospects.
- --------------------- ---------------------------------------------------------------------------------------------- -----------------------

"Standard & Poor's(R)," "S&P(R)," "S&P 500(R)," "Standard & Poor's 500," and "500" are trademarks of the McGraw-Hill  Companies,  Inc. and
have been licensed for use by American Skandia Investment Services,  Incorporated.  The Portfolio is not sponsored,  endorsed,  sold
or promoted by Standard & Poor's and  Standard & Poor's  makes no  representation  regarding  the  advisability  of investing in the
Portfolio.

The First Trust(R)10 Uncommon Values  portfolio is not sponsored or created by Lehman  Brothers,  Inc.  ("Lehman  Brothers").  Lehman
Brothers' only  relationship  to First Trust is the licensing of certain  trademarks  and trade names of Lehman  Brothers and of the
"10 Uncommon  Values" which is  determined,  composed and calculated by Lehman  Brothers  without regard to First Trust or the First
Trust(R)10 Uncommon Values portfolio.

Dow Jones has no  relationship  to the ProFunds VP, other than the  licensing of the Dow Jones sector  indices and its service marks
for use in  connection  with the ProFunds VP. The ProFunds VP are not  sponsored,  endorsed,  sold, or promoted by Standard & Poor's
or NASDAQ,  and neither  Standard & Poor's nor NASDAQ  makes any  representations  regarding  the  advisability  of investing in the
ProFunds VP.

WHAT ARE THE FIXED INVESTMENT OPTIONS?
We offer fixed  investment  options of  different  durations  during the  accumulation  period.  These  "Fixed  Allocations"  earn a
guaranteed  fixed rate of interest for a specified  period of time,  called the "Guarantee  Period." In most states,  we offer Fixed
Allocations  with Guarantee  Periods from 1 to 10 years.  We may also offer special  purpose Fixed  Allocations for use with certain
optional  investment  programs.  We guarantee the fixed rate for the entire Guarantee Period.  However,  if you withdraw or transfer
Account Value before the end of the Guarantee  Period,  we will adjust the value of your  withdrawal or transfer based on a formula,
called a "Market Value  Adjustment."  The Market Value  Adjustment can either be positive or negative,  depending on the movement of
applicable  interest  rates  payable on Strips of the  appropriate  duration.  Please  refer to the section  entitled  "How does the
Market Value  Adjustment  Work?" for a  description  of the formula along with  examples of how it is  calculated.  You may allocate
Account Value to more than one Fixed Allocation at a time.

Fixed  Allocations  may not be available in all states.  Availability  of Fixed  Allocations  is subject to change and may differ by
state and by the annuity product you purchase.  Please call American Skandia at  1-800-680-8920  to determine  availability of Fixed
Allocations in your state and for your annuity product.

FEES AND CHARGES

WHAT ARE THE CONTRACT FEES AND CHARGES?

Contingent  Deferred  Sales Charge:  We do not deduct a sales charge from Purchase  Payments you make to your Annuity.  However,  we
may deduct a Contingent  Deferred  Sales Charge or CDSC if you  surrender  your Annuity or when you make a partial  withdrawal.  The
CDSC reimburses us for expenses related to sales and distribution of the Annuity,  including  commissions,  marketing  materials and
other  promotional  expenses.  The CDSC is calculated as a percentage of your Purchase Payment being surrendered or withdrawn during
the applicable  Annuity Year.  For purposes of  calculating  the CDSC, we consider the year following the Issue Date of your Annuity
as Year 1. The amount of the CDSC  decreases  over time,  measured  from the Issue Date of the  Annuity.  The CDSC  percentages  are
shown below.

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

       YEARS                      1          2         3          4          5          6          7          8         9+
       ---------------------- ---------- ---------- --------- ---------- ---------- ---------- ---------- ---------- ----------
       ---------------------- ---------- ---------- --------- ---------- ---------- ---------- ---------- ---------- ----------

       CHARGE (%)               7.5%       7.0%       6.5%      6.0%       5.0%       4.0%       3.0%       2.0%       0.0%
       ---------------------- ---------- ---------- --------- ---------- ---------- ---------- ---------- ---------- ----------

The CDSC  period is based on the Issue Date of the  Annuity,  not on the date each  Purchase  Payment  is  applied  to the  Annuity.
Purchase  Payments  applied  to the  Annuity  after the Issue  Date do not have their own CDSC  period.  During the first  eight (8)
Annuity  Years,  under certain  circumstances  you can withdraw a limited  amount of Account Value  without  paying a CDSC.  This is
referred to as a "Free  Withdrawal."  After eight (8)  complete  Annuity  Years,  you can  surrender  your Annuity or make a partial
withdrawal  without a CDSC being  deducted  from the amount being  withdrawn.  Free  Withdrawals  are not treated as a withdrawal of
Purchase  Payments for purposes of calculating  the CDSC on a subsequent  withdrawal or surrender.  Withdrawals  of amounts  greater
than the  maximum  Free  Withdrawal  amount are treated as a  withdrawal  of  Purchase  Payments  and will be assessed a CDSC during
Annuity  Years 1 through 8. For purposes of  calculating  the CDSC on a surrender  or a partial  withdrawal,  the Purchase  Payments
being withdrawn may be greater than your remaining  Account Value or the amount of your withdrawal  request.  This is most likely to
occur if you have made prior withdrawals  under the Free Withdrawal  provision or if your Account Value has declined in value due to
negative market performance.

We may  waive  the CDSC  under  certain  medically-related  circumstances  or when  taking a Minimum  Distribution  from an  Annuity
purchased  as a  "qualified"  investment.  Free  Withdrawals,  Medically-Related  Surrenders  and  Minimum  Distributions  are  each
explained more fully in the section entitled "Access to Your Account Value".

Transfer  Fee:  Currently,  you may make twenty (20) free  transfers  between  investment  options each Annuity Year. We will charge
$10.00 for each  transfer  after the  twentieth in each Annuity  Year.  We do not consider  transfers  made as part of a dollar cost
averaging  program when we count the twenty free  transfers.  Transfers made as part of a rebalancing,  market timing or third party
investment  advisory  service will be subject to the  twenty-transfer  limit.  However,  all transfers  made on the same day will be
treated as one (1)  transfer.  Renewals or transfers of Account Value from a Fixed  Allocation  at the end of its  Guarantee  Period
are not  subject  to the  Transfer  Fee and are not  counted  toward  the twenty  free  transfers.  We may reduce the number of free
transfers  allowable  each  Annuity  Year  (subject to a minimum of eight)  without  charging a Transfer  Fee unless you make use of
electronic  means to transmit  your  transfer  requests.  We may  eliminate  the  Transfer  Fee for  transfer  requests  transmitted
electronically or through other means that reduce our processing costs.

Annual  Maintenance Fee: During the accumulation  period we deduct an Annual  Maintenance Fee. The Annual  Maintenance Fee is $35.00
or 2% of your Account Value invested in the variable  investment  options,  whichever is less. This fee will be deducted annually on
the  anniversary  of the Issue Date of your Annuity or, if you surrender  your Annuity  during the Annuity Year, the fee is deducted
at the time of  surrender.  Currently,  the Annual  Maintenance  Fee is only deducted if your Account Value is less than $100,000 on
the anniversary of the Issue Date or at the time of surrender.  We may increase the Annual  Maintenance Fee.  However,  any increase
will only apply to Annuities issued after the date of the increase.

Tax  Charges:  Several  states and some  municipalities  charge  premium  taxes or similar  taxes.  The amount of tax will vary from
jurisdiction  to  jurisdiction  and is subject to change.  The tax charge  currently  ranges up to 3 1/2%. We generally will deduct the
amount of tax payable at the time the tax is imposed,  but may also decide to deduct tax charges from each  Purchase  Payment at the
time of a withdrawal  or surrender of your Annuity or at the time you elect to begin  receiving  annuity  payments.  We may assess a
charge against the Sub-accounts and the Fixed Allocations equal to any taxes which may be imposed upon the separate accounts.

WHAT CHARGES APPLY SOLELY TO THE VARIABLE INVESTMENT OPTIONS?

Insurance  Charge:  We deduct an  Insurance  Charge  daily  against the average  daily assets  allocated  to the  Sub-accounts.  The
Insurance  Charge is equal to 0.65% on an annual  basis.  The  Insurance  Charge is  intended  to  compensate  American  Skandia for
providing the insurance benefits under the Annuity,  including the Annuity's basic death benefit that provides  guaranteed  benefits
to your  beneficiaries  even if the market declines and the risk that persons we guarantee annuity payments to will live longer than
our  assumptions.  The  charge  also  covers  administrative  costs  associated  with  providing  the  Annuity  benefits,  including
preparation of the contract,  confirmation  statements,  annual account statements and annual reports,  legal and accounting fees as
well as various related  expenses.  Finally,  the charge covers the risk that our assumptions about the mortality risks and expenses
under this Annuity are  incorrect and that we have agreed not to increase  these charges over time despite our actual costs.  We may
increase the portion of the total  Insurance  Charge that is deducted for  administrative  costs;  however,  any increase  will only
apply to Annuities issued after the date of the increase.

American  Skandia may make a profit on the Insurance  Charge if, over time,  the actual cost of providing the  guaranteed  insurance
obligations  under the Annuity are less than the amount we deduct for the  Insurance  Charge.  To the extent we make a profit on the
Insurance  Charge,  such profit may be used for any other  corporate  purpose,  including  payment of other  expenses  that American
Skandia incurs in promoting, distributing, issuing and administering the Annuity.

The  Insurance  Charge is not deducted  against  assets  allocated  to a Fixed  Allocation.  However,  the amount we credit to Fixed
Allocations may also reflect similar assumptions about the insurance guarantees provided under the Annuity.

Distribution  Charge:  We deduct a  Distribution  Charge  daily  against the  average  assets  allocated  to the  Sub-accounts.  The
Distribution  Charge is equal to 0.60% on an annual  basis in Annuity  Years 1 through 8. After the end of the first  eight  Annuity
Years, the 0.60% charge for  distribution  will no longer be assessed.  The  Distribution  Charge is intended to compensate us for a
portion of our  acquisition  expenses under the Annuity,  including  promotion and  distribution  of the Annuity.  The  Distribution
Charge is deducted  against your  Annuity's  Account  Value and any  increases  or  decreases in your Account  Value based on market
fluctuations  of the  Sub-accounts.  A portion of the proceeds  that American  Skandia  receives  from the  Distribution  Charge may
include amounts based on market appreciation of the Sub-account values.

Optional  Benefits:  If you elect to purchase one or more optional  benefits,  we will deduct an additional  charge on a daily basis
from your Account Value allocated to the  Sub-accounts  with the exception of the Guaranteed  Minimum Income Benefit which charge is
assessed  against the Protected Income Value and deducted  annually in arrears.  The charge for each optional benefit is deducted in
addition to the Insurance Charge due to the increased  insurance risk associated with the optional  benefits.  The additional charge
is  included  in the daily  calculation  of the Unit Price for each  Sub-account.  Please  refer to the  sections  entitled  "Living
Benefit Programs" and "Death Benefit" for a description of the charge for each Optional Benefit.

WHAT CHARGES ARE ASSESSED BY THE PORTFOLIOS?
We do not assess any charges directly  against the Portfolios.  However,  each Portfolio  charges a total annual fee comprised of an
investment  management  fee,  operating  expenses  and any  distribution  and service  (12b-1)  fees that may apply.  These fees are
deducted  daily by each  Portfolio  before it provides  American  Skandia with the net asset value as of the close of business  each
day.  More  detailed  information  about fees and  charges  can be found in the  prospectuses  for the  Portfolios.  Please also see
"Service Fees Payable by Underlying Funds".

WHAT CHARGES APPLY TO THE FIXED ALLOCATIONS?
No specific fee or expenses are deducted when determining the rate we credit to a Fixed  Allocation.  However,  for some of the same
reasons that we deduct the Insurance  Charge against Account Value allocated to the  Sub-accounts,  we also take into  consideration
mortality,  expense,  administration,  profit and other factors in determining  the interest  rates we credit to Fixed  Allocations.
Any CDSC or Tax Charge applies to amounts that are taken from the variable  investment  options or the Fixed  Allocations.  A Market
Value Adjustment may also apply to transfers, certain withdrawals, surrender or annuitization from a Fixed Allocation.

WHAT CHARGES APPLY IF I CHOOSE AN ANNUITY PAYMENT OPTION?
In certain states a tax is due if and when you exercise your right to receive  periodic  annuity  payments.  The amount payable will
depend on the applicable  jurisdiction  and on the annuity  payment  option you select.  If you select a fixed payment  option,  the
amount of each fixed payment will depend on the Account  Value of your Annuity when you elected to  annuitize.  There is no specific
charge  deducted  from these  payments;  however,  the amount of each  annuity  payment  reflects  assumptions  about our  insurance
expenses.  If you select a variable  payment option that we may offer,  then the amount of your benefits will reflect changes in the
value of your Annuity and will continue to be subject to an insurance charge.

EXCEPTIONS/REDUCTIONS TO FEES AND CHARGES
We may reduce or eliminate  certain  fees and charges or alter the manner in which the  particular  fee or charge is  deducted.  For
example,  we may  reduce  the  amount of the CDSC or the length of time it  applies,  reduce or  eliminate  the amount of the Annual
Maintenance  Fee or reduce the  portion of the total  Insurance  Charge that is deducted  as an  Administration  Charge.  Generally,
these types of changes will be based on a reduction to our sales,  maintenance or  administrative  expenses due to the nature of the
individual or group  purchasing  the Annuity.  Some of the factors we might consider in making such a decision are: (a) the size and
type of group; (b) the number of Annuities  purchased by an Owner;  (c) the amount of Purchase  Payments or likelihood of additional
Purchase Payments;  and/or (d) other transactions where sales,  maintenance or administrative  expenses are likely to be reduced. We
will not discriminate  unfairly between Annuity  purchasers if and when we reduce the portion of the Insurance Charge  attributed to
the charge covering administrative costs.

PURCHASING YOUR ANNUITY

WHAT ARE OUR REQUIREMENTS FOR PURCHASING THE ANNUITY?

Initial  Purchase  Payment:  You must make a minimum initial  Purchase  Payment of $1,000.  However,  if you decide to make payments
under a systematic  investment or "bank drafting"  program,  we will accept a lower initial Purchase  Payment provided that,  within
the first Annuity Year, you make at least $1,000 in total Purchase Payments.

Where allowed by law,  initial  Purchase  Payments in excess of $1,000,000  require our approval prior to  acceptance.  We may apply
certain limitations and/or  restrictions on the Annuity as a condition of our acceptance,  including limiting the liquidity features
or the Death Benefit protection provided under the Annuity,  limiting the right to make additional  Purchase Payments,  changing the
number of transfers  allowable  under the Annuity or restricting  the  Sub-accounts  that are available.  Other  limitations  and/or
restrictions may apply.

Except as noted below,  Purchase  Payments  must be submitted by check drawn on a U.S.  bank, in U.S.  dollars,  and made payable to
American  Skandia.  Purchase  Payments  may also be  submitted  via 1035  exchange  or  direct  transfer  of  funds.  Under  certain
circumstances,  Purchase  Payments may be transmitted to American  Skandia via wiring funds through your  investment  professional's
broker-dealer  firm.  Additional  Purchase Payments may also be applied to your Annuity under an arrangement  called "bank drafting"
where you  authorize us to deduct money  directly from your bank account.  We call our bank  drafting  program "Auto Saver".  We may
reject any  payment if it is  received  in an  unacceptable  form.  Our  acceptance  of a check is subject to our ability to collect
funds.

Age  Restrictions:  The Owner must be age 80 or under as of the Issue Date of the  Annuity.  If the  Annuity is owned  jointly,  the
oldest of the Owners must be age 80 or under on the Issue  Date.  If the Annuity is owned by an entity,  the  Annuitant  must be age
80 or under as of the Issue Date.  You should  consider your need to access your Account  Value and whether the Annuity's  liquidity
features  will satisfy that need. If you take a  distribution  prior to age 591/2, you may be subject to a 10% penalty in addition to
ordinary  income taxes on any gain.  The  availability  of certain  optional  benefits may vary based on the age of the Owner on the
Issue Date of the Annuity.

Owner,  Annuitant and Beneficiary  Designations:  On your  Application,  we will ask you to name the Owner(s),  Annuitant and one or
more Beneficiaries for your Annuity.

|X|      Owner:  The  Owner(s)  holds all rights  under the  Annuity.  You may name more than one Owner in which case all  ownership
       rights are held  jointly.  However,  this  Annuity does not provide a right of  survivorship.  Refer to the Glossary of Terms
       for a complete description of the term "Owner."
|X|      Annuitant:  The  Annuitant is the person we agree to make annuity  payments to and upon whose life we continue to make such
       payments.  You must name an Annuitant who is a natural  person.  We do not accept a designation  of joint  Annuitants  during
       the accumulation  period. Where allowed by law, you may name one or more Contingent  Annuitants.  A Contingent Annuitant will
       become the Annuitant if the Annuitant  dies before the Annuity Date.  Please refer to the discussion of  "Considerations  for
       Contingent Annuitants" in the Tax Considerations section of the Prospectus.
|X|      Beneficiary:  The  Beneficiary  is the  person(s) or entity you name to receive the death  benefit.  If no  beneficiary  is
       named the death benefit will be paid to you or your estate.

Your right to make  certain  designations  may be limited if your  Annuity is to be used as an IRA or other  "qualified"  investment
that is given  beneficial  tax treatment  under the Code.  You should seek  competent tax advice on the income,  estate and gift tax
implications of your designations.

MANAGING YOUR ANNUITY

MAY I CHANGE THE OWNER, ANNUITANT AND BENEFICIARY DESIGNATIONS?
You may change the Owner,  Annuitant and  Beneficiary  designations  by sending us a request in writing.  Where allowed by law, such
changes will be subject to our acceptance.  Some of the changes we will not accept include, but are not limited to:
|X|      a new  Owner  subsequent  to  the  death  of the  Owner  or  the  first  of  any  joint  Owners  to  die,  except  where  a
     spouse-Beneficiary has become the Owner as a result of an Owner's death;
|X|      a new Annuitant subsequent to the Annuity Date;
|X|      for "non-qualified" investments, a new Annuitant prior to the Annuity Date if the Annuity is owned by an entity; and
|X|      a change in Beneficiary if the Owner had previously made the designation irrevocable.

Spousal Owners/Spousal Beneficiaries
If an Annuity is co-owned by spouses,  we will assume that the sole primary  Beneficiary is the surviving spouse unless you elect an
alternative  Beneficiary  designation.  Unless you elect an alternative  Beneficiary  designation,  upon the death of either spousal
Owner,  the surviving  spouse may elect to assume  ownership of the Annuity instead of taking the Death Benefit  payment.  The Death
Benefit  that would have been  payable  will be the new  Account  Value of the  Annuity as of the date of due proof of death and any
required  proof of a spousal  relationship.  As of the date the  assumption  is effective,  the  surviving  spouse will have all the
rights and  benefits  that would be  available  under the Annuity to a new  purchaser  of the same  attained  age.  For  purposes of
determining  any future Death Benefit for the beneficiary of the surviving  spouse,  the new Account Value will be considered as the
initial Purchase  Payment.  No CDSC will apply to the new Account Value.  However,  any additional  Purchase  Payments applied after
the date the assumption is effective will be subject to all provisions of the Annuity, including the CDSC when applicable.

Spousal Contingent Annuitant
If the Annuity is owned by an entity and the surviving spouse is named as a Contingent  Annuitant,  upon the death of the Annuitant,
the  surviving  spouse  will  become the  Annuitant.  No Death  Benefit is payable  upon the death of the  Annuitant.  However,  the
Account  Value  of the  Annuity  as of the  date of due  proof of death of the  Annuitant  (and any  required  proof of the  spousal
relationship) will reflect the amount that would have been payable had a Death Benefit been paid.

MAY I RETURN THE ANNUITY IF I CHANGE MY MIND?
If after  purchasing  your Annuity you change your mind and decide that you do not want it, you may return it to us within a certain
period of time known as a right to cancel  period.  This is often  referred  to as a  "free-look."  Depending  on the state in which
you purchased your Annuity and, in some states,  if you purchased the Annuity as a replacement  for a prior  contract,  the right to
cancel period may be ten (10) days,  twenty-one (21) days or longer,  measured from the time that you received your Annuity.  If you
return your Annuity during the  applicable  period,  we will refund your current  Account Value plus any tax charge  deducted.  This
amount may be higher or lower than your  original  Purchase  Payment.  Where  required by law, we will return your  current  Account
Value or the amount of your  initial  Purchase  Payment,  whichever  is  greater.  The same  rules may apply to an  Annuity  that is
purchased as an IRA. In any situation  where we are required to return the greater of your  Purchase  Payment or Account  Value,  we
may  allocate  your  Account  Value to the AST Money  Market  Sub-account  during the right to cancel  period  and for a  reasonable
additional amount of time to allow for delivery of your Annuity.

MAY I MAKE ADDITIONAL PURCHASE PAYMENTS?
The minimum  amount that we accept as an additional  Purchase  Payment is $100 unless you  participate in "Auto Saver" or a periodic
purchase  payment  program.  We will allocate any additional  Purchase  Payments you make  according to your most recent  allocation
instructions, unless you request new allocations when you submit a new Purchase Payment.

MAY I MAKE SCHEDULED PAYMENTS DIRECTLY FROM MY BANK ACCOUNT?
You can make  additional  Purchase  Payments to your Annuity by  authorizing  us to deduct money directly from your bank account and
applying  it to your  Annuity.  This type of program is often  called  "bank  drafting".  We call our bank  drafting  program  "Auto
Saver."  Purchase  Payments  made through Auto Saver may only be allocated to the variable  investment  options when  applied.  Auto
Saver allows you to invest in your Annuity with a lower  initial  Purchase  Payment,  as long as you  authorize  payments  that will
equal at least $1,000  during the first 12 months of your Annuity.  We may suspend or cancel bank drafting  privileges if sufficient
funds are not available from the applicable financial institution on any date that a transaction is scheduled to occur.

MAY I MAKE PURCHASE PAYMENTS THROUGH A SALARY REDUCTION PROGRAM?
These types of programs are only available with certain types of qualified  investments.  If your employer  sponsors such a program,
we may agree to accept periodic  Purchase  Payments through a salary  reduction  program as long as the allocations are made only to
variable investment options and the periodic Purchase Payments received in the first year total at least $1,000.

MANAGING YOUR ACCOUNT VALUE

HOW AND WHEN ARE PURCHASE PAYMENTS INVESTED?
(See "Valuing Your Investment" for a description of our procedure for pricing initial and subsequent Purchase Payments.)

Initial Purchase  Payment:  Once we accept your  application,  we invest your net Purchase Payment in the Annuity.  The net Purchase
Payment is your initial  Purchase  Payment minus any tax charges that may apply.  On your  application we ask you to provide us with
instructions  for  allocating  your Account  Value.  You can allocate  Account Value to one or more variable  investment  options or
Fixed Allocations.

In those  states  where we are  required  to return your  Purchase  Payment if you  exercise  your right to return the  Annuity,  we
initially  allocate  all  amounts  that  you  choose  to  allocate  to the  variable  investment  options  to the AST  Money  Market
Sub-account.  At the end of the  right to cancel  period  we will  reallocate  your  Account  Value  according  to your most  recent
allocation  instructions.  Where permitted by law, we will allocate your Purchase Payments  according to your initial  instructions,
without  temporarily  allocating  to the AST Money Market  Sub-account.  To do this,  we will ask that you execute our form called a
"return  waiver" that authorizes us to allocate your Purchase  Payment to your chosen  Sub-accounts  immediately.  If you submit the
"return  waiver" and then decide to return your Annuity  during the right to cancel  period,  you will receive your current  Account
Value which may be more or less than your initial Purchase Payment (see "May I Return the Annuity if I Change my Mind?").

Subsequent  Purchase  Payments:  We will allocate any additional  Purchase  Payments you make  according to your current  allocation
instructions.  If any rebalancing or asset  allocation  programs are in effect,  the allocation  should conform with such a program.
We assume that your current  allocation  instructions  are valid for subsequent  Purchase  Payments until you make a change to those
allocations or request new allocations when you submit a new Purchase Payment.

ARE THERE RESTRICTIONS OR CHARGES ON TRANSFERS BETWEEN INVESTMENT OPTIONS?
During the accumulation period you may transfer Account Value between investment  options.  Transfers are not subject to taxation on
any gain.  We  currently  limit the  number of  Sub-accounts  you can  invest in at any one time to twenty  (20).  However,  you can
invest in an unlimited  number of Fixed  Allocations.  We may require a minimum of $500 in each  Sub-account  you  allocate  Account
Value to at the time of any  allocation  or transfer.  If you request a transfer  and, as a result of the  transfer,  there would be
less than $500 in the Sub-account,  we may transfer the remaining  Account Value in the Sub-account pro rata to the other investment
options to which you transferred.

We may  impose  specific  restrictions  on  financial  transactions  for  certain  Portfolios  based on the  Portfolio's  investment
restrictions.  Currently,  any purchase,  redemption or transfer  involving the ProFunds VP  Sub-accounts  must be received by us no
later than one hour prior to any announced closing of the applicable  securities exchange (generally,  3:00 p.m. Eastern time) to be
processed on the current  Valuation  Day. The "cut-off"  time for such  financial  transactions  involving a ProFunds VP Sub-account
will be  extended  to1/2hour  prior to any  announced  closing  (generally,  3:30  p.m.  Eastern  time) for  transactions  submitted
electronically through American Skandia's Internet website (www.americanskandia.prudential.com).

Currently,  we charge $10.00 for each transfer after the twentieth (20th) in each Annuity Year,  including transfers made as part of
any rebalancing,  market timing,  asset allocation or similar program which you have authorized.  Transfers made as part of a dollar
cost  averaging  program do not count toward the twenty free  transfer  limit.  Renewals or transfers of Account  Value from a Fixed
Allocation at the end of its Guarantee  Period are not subject to the transfer  charge.  We may reduce the number of free  transfers
allowable  each  Annuity Year  (subject to a minimum of eight)  without  charging a Transfer  Fee unless you make use of  electronic
means to transmit your transfer  requests.  We may eliminate the Transfer Fee for transfer  requests  transmitted  electronically or
through other means that reduce our processing costs.

We reserve the right to limit the number of  transfers  in any Annuity  Year for all  existing  or new Owners.  We also  reserve the
right to limit the number of  transfers in any Annuity  Year or to refuse any  transfer  request for an Owner or certain  Owners if:
(a) we believe that excessive  trading or a specific  transfer request or group of transfer  requests may have a detrimental  effect
on Unit Values or the share prices of the  Portfolios;  or (b) we are informed by one or more of the Portfolios that the purchase or
redemption  of shares must be  restricted  because of  excessive  trading or a specific  transfer or group of transfers is deemed to
have a detrimental  effect on the share prices of affected  Portfolios.  Without  limiting the above, the most likely scenario where
either of the above could occur would be if the aggregate  amount of a trade or trades  represented a relatively large proportion of
the total assets of a particular  Portfolio.  Under such a circumstance,  we will process  transfers  according to our rules then in
effect and provide  notice if the  transfer  request was denied.  If a transfer  request is denied,  a new  transfer  request may be
required.

DO YOU OFFER DOLLAR COST AVERAGING?
Yes. We offer Dollar Cost Averaging during the accumulation  period.  Dollar Cost Averaging  allows you to  systematically  transfer
an amount  each month from one  investment  option to one or more other  investment  options.  You can choose to  transfer  earnings
only,  principal  plus  earnings  or a flat  dollar  amount.  Dollar  Cost  Averaging  allows you to invest  regularly  each  month,
regardless  of the current unit value (or price) of the  Sub-account(s)  you invest in. This enables you to purchase more units when
the market  price is low and fewer  units  when the market  price is high.  This may  result in a lower  average  cost of units over
time.  However,  there is no guarantee that Dollar Cost  Averaging will result in a profit or protect  against a loss in a declining
market.  We do not deduct a charge for participating in a Dollar Cost Averaging program.

You must have a minimum Account Value of at least $10,000 to enroll in a Dollar Cost Averaging program.

You can Dollar Cost Average from variable  investment  options or Fixed  Allocations.  Dollar Cost Averaging from Fixed  Allocations
is subject to a number of rules that include, but are not limited to the following:
|X|      You may only use Fixed Allocations with Guarantee Periods of 1, 2 or 3 years.
|X|      You may only Dollar Cost Average  earnings or principal  plus  earnings.  If  transferring  principal  plus  earnings,  the
     program must be designed to last the entire Guarantee Period for the Fixed Allocation.
|X|      Dollar Cost Averaging transfers from Fixed Allocations are not subject to a Market Value Adjustment.

NOTE:  When a Dollar Cost Averaging  program is established  from a Fixed  Allocation,  the fixed rate of interest we credit to your
Account  Value is applied to a declining  balance due to the  transfers of Account  Value to the  Sub-accounts  during the Guarantee
Period.  This will reduce the effective rate of return on the Fixed Allocation over the Guarantee Period.

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American  Skandia may offer Fixed  Allocations  with Guarantee  Periods of 6 months or 12 months  exclusively  for use with a Dollar
Cost Averaging  program ("DCA Fixed  Allocations").  DCA Fixed  Allocations are designed to automatically  transfer Account Value in
either 6 or 12 payments  under a Dollar Cost  Averaging  program.  Dollar Cost  Averaging  transfers will begin on the day following
the date the DCA Fixed  Allocation  is  established  and each month  following  until the entire  principal  amount plus earnings is
transferred.  DCA Fixed  Allocations may only be established  with your initial Purchase  Payment or additional  Purchase  Payments.
You may not transfer  existing  Account Value to a DCA Fixed  Allocation.  We reserve the right to terminate  offering these special
purpose Fixed Allocations at any time.
- ------------------------------------------------------------------------------------------------------------------------------------

Account  Value  allocated to the DCA Fixed  Allocation  will be  transferred  to the  Sub-accounts  you choose under the Dollar Cost
Averaging  program.  If you terminate the Dollar Cost Averaging  program before the entire  principal  amount plus earnings has been
transferred  to the  Sub-account(s),  you must  transfer all  remaining  Account Value to any other  investment  option.  Unless you
provide  alternate  instructions at the time you terminate the Dollar Cost Averaging  program,  Account Value will be transferred to
the AST Money Market  Sub-account.  Transfers from Fixed  Allocations as part of a Dollar Cost Averaging  program are not subject to
a Market Value  Adjustment.  However,  a Market Value  Adjustment  will apply if you  terminate  the Dollar Cost  Averaging  program
before the entire principal amount plus earnings has been transferred to the Sub-account(s).

DO YOU OFFER ANY AUTOMATIC REBALANCING PROGRAMS?
Yes. During the accumulation  period,  we offer automatic  rebalancing  among the variable  investment  options you choose.  You can
choose to have your Account  Value  rebalanced  quarterly,  semi-annually,  or annually.  On the  appropriate  date,  your  variable
investment  options are  rebalanced  to the  allocation  percentages  you request.  For example,  over time the  performance  of the
variable  investment  options will differ,  causing your percentage  allocations to shift. With automatic  rebalancing,  we transfer
the appropriate amount from the "overweighted"  Sub-accounts to the  "underweighted"  Sub-accounts to return your allocations to the
percentages  you request.  If you request a transfer  from or into any variable  investment  option  participating  in the automatic
rebalancing  program,  we will assume that you wish to change your rebalancing  percentages as well, and will  automatically  adjust
the rebalancing percentages in accordance with the transfer unless we receive alternate instructions from you.

You must have a minimum  Account Value of at least $10,000 to enroll in automatic  rebalancing.  All  rebalancing  transfers made on
the same day as part of an automatic  rebalancing  program are considered as one transfer when counting the number of transfers each
year toward the maximum number of free transfers. We do not deduct a charge for participating in an automatic rebalancing program.

DO YOU OFFER ANY ASSET ALLOCATION PROGRAMS?
Yes.  During  the  accumulation  period,  we offer two  different  asset  allocation  programs  designed  for  American  Skandia  by
Morningstar  Associates,  LLC. Each program is available to Annuity  Owners at no additional  charge.  Each program is designed as a
tool to enable you and your  investment  professional  to develop an asset  allocation  program that is  appropriate  for you.  Your
investment  professional will help you to complete an investor questionnaire that will help you and your investment  professional to
determine  whether  participating  in a program is  appropriate  for you and to determine your  investment  style from which you can
choose the available model  portfolios.  We offer one program where you and your investment  professional  choose from the available
Sub-accounts  for each asset  class in the model  portfolio  you have chosen  based on your  answers to the  questionnaire.  You may
change your  selected  Sub-accounts  at any time.  We offer a second  program  where the  Sub-accounts  for each asset class in each
model  portfolio are designated  based on an objective  evaluation of the available  Sub-accounts.  If you elect the second program,
the selected  Sub-accounts within a model portfolio may change  periodically.  Under both programs,  assets allocated to the program
are  rebalanced  on a periodic  basis based on suggested  changes to the  allocation  percentages  for an asset class within a model
portfolio  or based  on  changes  in the  value of the  Sub-accounts.  Each  asset  allocation  program  is  subject  to  additional
limitations and restrictions which are more fully described in the enrollment form for the programs.

Asset  allocation  is a  sophisticated  method of  diversification  which  allocates  assets among asset  classes in order to manage
investment risk and enhance  returns over the long term.  However,  asset  allocation does not guarantee a profit or protect against
a loss.  You are not obligated to  participate  or to invest  according to the program  recommendations.  American  Skandia does not
intend to provide any  personalized  investment  advice in connection  with these programs and you should not rely on these programs
as providing  individualized  investment  recommendations  to you. The asset allocation  programs do not guarantee better investment
results.  We reserve the right to  terminate  or change the asset  allocation  programs at any time.  You should  consult  with your
investment professional before electing any asset allocation program.

DO YOU OFFER A PROGRAM DESIGNED TO GUARANTEE A "RETURN OF PREMIUM" AT A FUTURE DATE?
Yes.  We offer a program  for  investors  who wish to invest in the  variable  investment  options  but also wish to  protect  their
principal,  at least as of a  specific  date in the  future.  You may not want to use this  program  if you  expect to begin  taking
annuity  payments before the program would be completed.  See Living Benefit  Programs  section of this Prospectus for a description
of the Guaranteed Return Option Plus optional benefit, which also offers protection of principal.

Balanced Investment Program
We offer a balanced  investment  program where a portion of your Account Value is allocated to a Fixed  Allocation and the remaining
Account  Value is  allocated  to the  variable  investment  options  that you  select.  When you enroll in the  Balanced  Investment
Program,  you choose the duration that you wish the program to last.  This  determines the duration of the Guarantee  Period for the
Fixed  Allocation.  Based on the fixed rate for the  Guarantee  Period  chosen,  we calculate the portion of your Account Value that
must be allocated to the Fixed  Allocation to grow to a specific  "principal  amount" (such as your initial  Purchase  Payment).  We
determine  the amount based on the rates then in effect for the Guarantee  Period you choose.  If you continue the program until the
end of the Guarantee  Period and make no withdrawals or transfers,  at the end of the Guarantee  Period,  the Fixed  Allocation will
have grown to equal the  "principal  amount".  Withdrawals or transfers  from the Fixed  Allocation  before the end of the Guarantee
Period will  terminate the program and may be subject to a Market Value  Adjustment.  You can transfer the Account Value that is not
allocated to the Fixed  Allocation  between any of the Sub-accounts  available under the Annuity.  Account Value you allocate to the
variable  investment options is subject to market  fluctuations and may increase or decrease in value. We do not deduct a charge for
participating in the Balanced Investment Program.

         Example
         Assume  you invest  $100,000.  You  choose a 10-year  program  and  allocate  a portion  of your  Account  Value to a Fixed
         Allocation  with a 10-year  Guarantee  Period.  The rate for the  10-year  Guarantee  Period is 5.33%*.  Based on the fixed
         interest rate for the Guarantee  Period chosen,  the factor is 0.594948 for determining how much of your Account Value will
         be  allocated  to the Fixed  Allocation.  That  means  that  $59,495  will be  allocated  to the Fixed  Allocation  and the
         remaining  Account Value  ($41,505)  will be allocated to the variable  investment  options.  Assuming that you do not make
         any  withdrawals  from the Fixed  Allocation,  it will grow to $100,000 at the end of the  Guarantee  Period.  Of course we
         cannot predict the value of the remaining Account Value that was allocated to the variable investment options.

*        The rate in this example is hypothetical and may not reflect the current rate for Guarantee Periods of this duration.

MAY I AUTHORIZE MY INVESTMENT PROFESSIONAL TO MANAGE MY ACCOUNT?
Yes. You may  authorize  your  investment  professional  to direct the  allocation  of your Account  Value and to request  financial
transactions  between  investment  options while you are living,  subject to our rules.  You must contact us immediately if and when
you revoke such authority.  We will not be responsible for acting on instructions  from your investment  professional if you fail to
inform us that such  person's  authority has been revoked.  We may also  suspend,  cancel or limit these  privileges at any time. We
will notify you if we do.

We or an affiliate of ours may provide  administrative  support to  licensed,  registered  investment  professionals  or  investment
advisors who you authorize to make financial  transactions on your behalf.  These investment  professionals  may be firms or persons
who also are  appointed by us as  authorized  sellers of the  Annuity.  However,  we do not offer advice about how to allocate  your
Account Value under any  circumstance.  Any investment  professionals  you engage to provide advice and/or make transfers for you is
not acting on our behalf. We are not responsible for any  recommendations  such investment  professionals make, any market timing or
asset allocation programs they choose to follow or any specific transfers they make on your behalf.

We may require  investment  professionals or investment  advisors,  who are authorized by multiple contract owners to make financial
transactions,  to enter into an administrative  agreement with American Skandia as a condition of our accepting transactions on your
behalf. The  administrative  agreement may impose  limitations on the investment  professional's or investment  advisor's ability to
request financial  transactions on your behalf.  These limitations are intended to minimize the detrimental  impact of an investment
professional  who is in a position to transfer  large  amounts of money for multiple  clients in a  particular  Portfolio or type of
portfolio  or  to  comply  with  specific   restrictions  or  limitations  imposed  by  a  Portfolio(s)  of  American  Skandia.  The
administrative agreement may limit the available investment options,  require advance notice of large transactions,  or impose other
trading limitations on your investment  professional.  Your investment  professional will be informed of all such restrictions on an
ongoing  basis.  We may also require that your  investment  professional  transmit all financial  transactions  using the electronic
trading functionality  available through our Internet website  (www.americanskandia.prudential.com).  Limitations that we may impose
on your investment  professional  or investment  advisor under the terms of the  administrative  agreement do not apply to financial
transactions requested by an Owner on their own behalf, except as otherwise described in this Prospectus.

HOW DO THE FIXED INVESTMENT OPTIONS WORK?
We credit the fixed  interest  rate to the Fixed  Allocation  throughout  a set period of time called a  "Guarantee  Period."  Fixed
Allocations  currently are offered with Guarantee Periods from 1 to 10 years. We may make Fixed  Allocations of different  durations
available in the future,  including Fixed Allocations offered exclusively for use with certain optional investment  programs.  Fixed
Allocations  may not be  available  in all states and may not always be  available  for all  Guarantee  Periods  depending on market
factors and other considerations.

The interest rate credited to a Fixed  Allocation is the rate in effect when the Guarantee  Period begins and does not change during
the  Guarantee  Period.  The rates are an  effective  annual rate of  interest.  We  determine  the  interest  rates for the various
Guarantee  Periods.  At the time that we confirm your Fixed  Allocation,  we will advise you of the interest  rate in effect and the
date your Fixed  Allocation  matures.  We may change the rates we credit new Fixed  Allocations  at any time. Any change in interest
rate does not affect Fixed  Allocations  that were in effect  before the date of the change.  To inquire as to the current rates for
Fixed Allocations, please call 1-800-766-4530.

A Guarantee Period for a Fixed Allocation begins:
|X|      when all or part of a net Purchase Payment is allocated to that particular Guarantee Period;
|X|      upon transfer of any of your Account Value to a Fixed Allocation for that particular Guarantee Period; or
|X|      when you "renew" a Fixed Allocation by electing a new Guarantee Period.

To the extent permitted by law, we may establish  different  interest rates for Fixed  Allocations  offered to a class of Owners who
choose to participate in various optional  investment  programs we make available.  This may include,  but is not limited to, Owners
who elect to use Fixed  Allocations  under a dollar cost averaging program (see "Do You Offer Dollar Cost Averaging?") or a balanced
investment  program (see "Do you offer programs  designed to guarantee a "Return of Premium" at a future date?").  The interest rate
credited to Fixed  Allocations  offered to this class of  purchasers  may be different  than those offered to other  purchasers  who
choose the same Guarantee  Period but who do not  participate  in an optional  investment  program.  Any such program is at our sole
discretion.

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American  Skandia may offer Fixed  Allocations  with Guarantee  Periods of 3 months or 6 months  exclusively for use as a short-term
Fixed  Allocation  ("Short-term  Fixed  Allocations").  Short-term  Fixed  Allocations  may only be  established  with your  initial
Purchase Payment or additional  Purchase  Payments.  You may not transfer  existing Account Value to a Short-term Fixed  Allocation.
We reserve the right to terminate offering these special purpose Fixed Allocations at any time.
- ------------------------------------------------------------------------------------------------------------------------------------

On the Maturity Date of the Short-term Fixed Allocation,  the Account Value will be transferred to the  Sub-account(s) you choose at
the inception of the program.  If no  instructions  are provided,  such Account  Value will be  transferred  to the AST Money Market
Sub-account.  Short-term  Fixed  Allocations  may not be renewed on the Maturity  Date. If you surrender the Annuity or transfer any
Account Value from the Short-term Fixed Allocation to any other investment  option before the end of the Guarantee  Period, a Market
Value Adjustment will apply.

HOW DO YOU DETERMINE RATES FOR FIXED ALLOCATIONS?
We do not have a specific  formula for determining the fixed interest rates for Fixed  Allocations.  Generally the interest rates we
offer for Fixed  Allocations will reflect the investment  returns available on the types of investments we make to support our fixed
rate  guarantees.  These  investment  types may include cash,  debt  securities  guaranteed by the United States  government and its
agencies and  instrumentalities,  money market instruments,  corporate debt obligations of different durations,  private placements,
asset-backed  obligations  and municipal  bonds. In determining  rates we also consider  factors such as the length of the Guarantee
Period for the Fixed  Allocation,  regulatory  and tax  requirements,  liquidity of the markets for the type of investments we make,
commissions,  administrative and investment  expenses,  our insurance risks in relation to the Fixed  Allocations,  general economic
trends and competition.  Some of these  considerations  are similar to those we consider in determining the Insurance Charge that we
deduct from Account Value allocated to the Sub-accounts.

We will credit interest on a new Fixed  Allocation in an existing  Annuity at a rate not less than the rate we are then crediting to
Fixed Allocations for the same Guarantee Period selected by new Annuity purchasers in the same class.

The  interest  rate we credit  for a Fixed  Allocation  is  subject  to a  minimum.  Please  refer to the  Statement  of  Additional
Information.  In certain states the interest rate may be subject to a minimum under state law or regulation.

HOW DOES THE MARKET VALUE ADJUSTMENT WORK?
If you transfer or withdraw  Account  Value from a Fixed  Allocation  more than 30 days before the end of its Guarantee  Period,  we
will  adjust the value of your  investment  based on a  formula,  called a "Market  Value  Adjustment"  or "MVA".  The amount of any
Market Value  Adjustment  can be either  positive or negative,  depending on the movement of a combination of Strip Yields on Strips
and an  Option-adjusted  Spread (each as defined  below)  between the time that you purchase the Fixed  Allocation  and the time you
make a transfer or  withdrawal.  The Market Value  Adjustment  formula  compares the  combination of Strip Yields for Strips and the
Option-adjusted  Spreads  as of the date the  Guarantee  Period  began  with the  combination  of Strip  Yields  for  Strips and the
Option-adjusted  Spreads as of the date the MVA is being  calculated.  In certain  states the amount of any Market Value  Adjustment
may be limited under state law or  regulation.  If your Annuity is governed by the laws of that state,  any Market Value  Adjustment
that applies will be subject to our rules for complying with such law or regulation.

|X|      "Strips"  are a form of  security  where  ownership  of the  interest  portion of United  States  Treasury  securities  are
     separated from ownership of the underlying principal amount or corpus.
|X|      "Strip Yields" are the yields payable on coupon Strips of United States Treasury securities.
|X|      "Option-adjusted  Spread" is the difference between the yields on corporate debt securities  (adjusted to disregard options
     on such  securities)  and government debt  securities of comparable  duration.  We currently use the Merrill Lynch 1 to 10 year
     Investment Grade Corporate Bond Index of Option-adjusted Spreads.

MVA Formula
The MVA formula is applied  separately  to each Fixed  Allocation  to  determine  the  Account  Value of the Fixed  Allocation  on a
particular date.  The formula is as follows:

                                                    [(1+I) / (1+J+0.0010)]N/365
                                                               where:

                  I is the Strip Yield as of the start date of the Guarantee  Period for coupon Strips  maturing at
                  the end of the  applicable  Guarantee  Period plus the  Option-adjusted  Spread.  If there are no
                  Strips  maturing  at that time,  we will use the Strip  Yield for the Strips  maturing as soon as
                  possible after the Guarantee Period ends.

                  J is the Strip Yield as of the date the MVA formula is being applied for coupon  Strips  maturing
                  at the end of the applicable  Guarantee Period plus the  Option-adjusted  Spread. If there are no
                  Strips  maturing  at that time,  we will use the Strip  Yield for the Strips  maturing as soon as
                  possible after the Guarantee Period ends.

                  N is the number of days remaining in the original Guarantee Period.

If you surrender your Annuity under the right to cancel provision, the MVA formula is [(1 + I)/(1 + J)]N/365.

MVA Examples
The following hypothetical examples show the effect of the MVA in determining Account Value.  Assume the following:
|X|      On December 31, 2000, you allocate  $50,000 into a Fixed  Allocation with a Guarantee  Period of 5 years (e.g. the Maturity
         Date is December 31, 2005).
|X|      The  Strip  Yields  for  coupon  Strips  beginning  on  December  31,  2000 and  maturing  on  December  31,  2005 plus the
         Option-adjusted Spread is 5.50% (I = 5.50%).
|X|      You make no  withdrawals  or transfers  until you decided to withdraw the entire Fixed  Allocation  after exactly three (3)
         years, therefore 730 days remain before the Maturity Date (N = 730).

Example of Positive MVA
Assume  that at the time you  request  the  withdrawal,  the  Strip  Yields  for  Strips  maturing  on  December  31,  2005 plus the
Option-adjusted Spread is 4.00%  (J = 4.00%).  Based on these assumptions, the MVA would be calculated as follows:

                                 MVA Factor = [(1+I)/(1+J+0.0010)]N/365 = [1.055/1.041]2 = 1.027078
                                                     Interim Value = $57,881.25
                                 Account Value after MVA = Interim Value X MVA Factor = $59,448.56

Example of Negative MVA
Assume  that at the time you  request  the  withdrawal,  the  Strip  Yields  for  Strips  maturing  on  December  31,  2005 plus the
Option-adjusted Spread is 7.00% (J = 7.00%).  Based on these assumptions, the MVA would be calculated as follows:

                                MVA Factor = [(1+I)/(1+J+0.0010)]N/365 = [1.055/1.071)]2 = 0.970345
                                                     Interim Value = $57,881.25
                                 Account Value after MVA = Interim Value X MVA Factor = $56,164.78.

WHAT HAPPENS WHEN MY GUARANTEE PERIOD MATURES?
The "Maturity  Date" for a Fixed  Allocation is the last day of the Guarantee  Period.  Before the Maturity  Date, you may choose to
renew the Fixed  Allocation  for a new  Guarantee  Period of the same or  different  length or you may  transfer all or part of that
Fixed  Allocation's  Account  Value to another  Fixed  Allocation  or to one or more  Sub-accounts.  We will not charge a MVA if you
choose to renew a Fixed  Allocation on its Maturity Date or transfer the Account Value to one or more variable  investment  options.
We will notify you before the end of the Guarantee  Period about the fixed  interest  rates that we are  currently  crediting to all
Fixed Allocations that are being offered.  The rates being credited to Fixed Allocations may change before the Maturity Date.

If you do not specify how you want a Fixed  Allocation  to be  allocated  on its Maturity  Date,  we will then  transfer the Account
Value of the Fixed  Allocation to the AST Money Market  Sub-account.  You can then elect to allocate the Account Value to any of the
Sub-accounts or to a new Fixed Allocation.

ACCESS TO ACCOUNT VALUE

WHAT TYPES OF DISTRIBUTIONS ARE AVAILABLE TO ME?
During the accumulation  period you can access your Account Value through Partial  Withdrawals,  Systematic  Withdrawals,  and where
required for tax  purposes,  Minimum  Distributions.  You can also  surrender  your Annuity at any time.  We may deduct a portion of
the Account Value being  withdrawn or surrendered  as a CDSC. If you surrender your Annuity,  in addition to any CDSC, we may deduct
the Annual  Maintenance  Fee,  any Tax Charge that  applies  and the charge for any  optional  benefits.  We may also apply a Market
Value  Adjustment  to any Fixed  Allocations.  Certain  amounts may be  available to you each Annuity Year that are not subject to a
CDSC.  These are called "Free  Withdrawals."  In addition,  under certain  circumstances,  we may waive the CDSC for surrenders made
for  qualified  medical  reasons  or for  withdrawals  made to  satisfy  Minimum  Distribution  requirements.  Unless  you notify us
differently,  withdrawals  are taken  pro-rata  based on the Account  Value in the  investment  options at the time we receive  your
withdrawal request.  Each of these types of distributions is described more fully below.

ARE THERE TAX IMPLICATIONS FOR DISTRIBUTIONS?
(For more information, see "Tax Considerations")

During the Accumulation Period
A  distribution  during the  accumulation  period is deemed to come first from any "gain" in your  Annuity and second as a return of
your "tax basis",  if any.  Distributions  from your Annuity are generally  subject to ordinary income taxation on the amount of any
investment gain unless the distribution  qualifies as a non-taxable  exchange or transfer.  If you take a distribution  prior to the
taxpayer's  age 59 1/2, you may be subject to a 10% penalty in addition to ordinary  income taxes on any gain.  You may wish to consult
a professional tax advisor for advice before requesting a distribution.

During the Annuitization Period
During the  annuitization  period,  a portion of each annuity payment is taxed as ordinary income at the tax rate you are subject to
at the time of the  payment.  The Code and  regulations  have  "exclusionary  rules" that we use to  determine  what portion of each
annuity  payment  should be  treated as a return of any tax basis you have in the  Annuity.  Once the tax basis in the  Annuity  has
been distributed,  the remaining  annuity payments are taxable as ordinary income.  The tax basis in the Annuity may be based on the
tax-basis from a prior contract in the case of a 1035 exchange or other qualifying transfer.

CAN I WITHDRAW A PORTION OF MY ANNUITY?
Yes, you can make a withdrawal during the accumulation period.

|X|      To meet  liquidity  needs,  you can withdraw a limited  amount from your Annuity during each of Annuity Years 1-8 without a
         CDSC  being  applied.  We call this the "Free  Withdrawal"  amount.  The Free  Withdrawal  amount is not  available  if you
         choose to surrender your Annuity.  Amounts  withdrawn as a Free  Withdrawal do not reduce the amount of CDSC that may apply
         upon a subsequent withdrawal or surrender of the Annuity.  The minimum Free Withdrawal you may request is $100.

|X|      You can also make  withdrawals in excess of the Free Withdrawal  amount.  We call this a "Partial  Withdrawal."  The amount
         that you may withdraw  will depend on the Annuity's  Surrender  Value.  The Surrender  Value is equal to your Account Value
         minus any CDSC,  the Annual  Maintenance  Fee,  the Tax Charge,  any charges for  optional  benefits  and any Market  Value
         Adjustment  that may apply to any Fixed  Allocations.  After any Partial  Withdrawal,  your  Annuity  must have a Surrender
         Value of at least $1,000,  or we may treat the Partial  Withdrawal  request as a request to fully  surrender  your Annuity.
         The minimum Partial Withdrawal you may request is $100.

When we determine if a CDSC applies to Partial  Withdrawals  and  Systematic  Withdrawals,  we will first  determine  what,  if any,
amounts  qualify as a Free  Withdrawal.  Those amounts are not subject to the CDSC.  Partial  Withdrawals or Systematic  Withdrawals
of amounts greater than the maximum Free Withdrawal amount will be subject to a CDSC.

You may request a withdrawal  for an exact dollar amount after  deduction of any CDSC that applies  (called a "net  withdrawal")  or
request a gross  withdrawal  from which we will deduct any CDSC that applies,  resulting in less money being payable to you than the
amount you  requested.  If you request a net  withdrawal,  the amount  deducted  from your Account Value to pay the CDSC may also be
subject to a CDSC.

Partial Withdrawals may also be available following annuitization but only if you choose certain annuity payment options.

To request the forms  necessary to make a withdrawal  from your  Annuity,  contact our Customer  Service Team at  1-800-680-8920  or
visit our Internet Website at www.americanskandia.prudential.com.

HOW MUCH CAN I WITHDRAW AS A FREE WITHDRAWAL?

Annuity Years 1-8
The  maximum  Free  Withdrawal  amount  during  each of Annuity  Years 1 through 8 (when a CDSC would  otherwise  apply to a partial
withdrawal  or  surrender  of your  initial  Purchase  Payments)  is 10% of all  Purchase  Payments.  We may  apply a  Market  Value
Adjustment to any Fixed  Allocations.  The 10% Free  Withdrawal  amount is not  cumulative.  Withdrawals of amounts greater than the
maximum Free Withdrawal  amount are treated as a withdrawal of Purchase  Payments and will be assessed a CDSC during Annuity Years 1
through 8. If,  during  Annuity  Years 1 through 8, all  Purchase  Payments  withdrawn  are subject to a CDSC,  then any  subsequent
withdrawals  will be withdrawn from any gain in the Annuity.  If you do not make a Free  Withdrawal  during an Annuity Year, you are
not allowed to carry over the Free Withdrawal amount to the next Annuity Year.

Annuity Years 9+
After  Annuity Year 8, you can surrender  your Annuity or make a partial  withdrawal  without a CDSC being  deducted from the amount
being withdrawn.

NOTE:  Amounts that you have  withdrawn as a Free  Withdrawal  will not reduce the amount of any CDSC that we deduct if,  during the
first eight (8) Annuity Years, you make a partial withdrawal or choose to surrender the Annuity.


Examples
1.       Assume you make an initial  Purchase  Payment of  $10,000  and make no  additional  Purchase  Payments.  The  maximum  Free
     Withdrawal amount during each of the first eight Annuity Years would be 10% of $10,000, or $1,000.

2.       Assume you make an initial  Purchase  Payment of $10,000 and make an additional  Purchase Payment of $5,000 in Annuity Year
     6. The maximum Free  Withdrawal  amount during Annuity Years 7 and 8 would be 10% of $15,000,  or $1,500.  Beginning in Annuity
     Year 9 and  thereafter,  you can surrender  your Annuity or make a partial  withdrawal  without a CDSC being  deducted from the
     amount being withdrawn.

3.       Assume you make an initial  Purchase  Payment of $10,000 and take a Free Withdrawal of $500 in Annuity Year 6 and $1,000 in
     Annuity  Year 7. If you  surrender  your  Annuity in Annuity  Year 8, the CDSC will be assessed  against  the initial  Purchase
     Payment  amount  ($10,000),  not the amount of Purchase  Payments  reduced by the amounts  that were  withdrawn  under the Free
     Withdrawal provision.

IS THERE A CHARGE FOR A PARTIAL WITHDRAWAL?
A CDSC may be  assessed  against a Partial  Withdrawal  during the first  eight (8) Annuity  Years.  Whether a CDSC  applies and the
amount to be charged depends on whether the Partial  Withdrawal  exceeds any Free Withdrawal  amount and, if so, the number of years
that have elapsed since the Issue Date of the Annuity.

1.       If you request a Partial  Withdrawal,  we determine if the amount you requested is available as a Free Withdrawal (in which
     case it would not be subject to a CDSC);
2.       If the amount  requested  exceeds the available Free  Withdrawal  amount,  we determine if a CDSC will apply to the Partial
     Withdrawal  based on the number of years that have elapsed  since the Annuity was issued.  The maximum Free  Withdrawal  amount
     during each of Annuity  Years 1 through 8 is 10% of all  Purchase  Payments.  Withdrawals  of amounts  greater than the maximum
     Free Withdrawal  amount are treated as a withdrawal of Purchase  Payments and will be assessed a CDSC. If, during Annuity Years
     1 through 8, all Purchase Payments are withdrawn subject to a CDSC, then any subsequent  withdrawals will be withdrawn from any
     gain in the Annuity.

3.       If the amount  requested  exceeds the amounts  available  under Item #2 above,  we withdraw the  remaining  amount from any
     other Account Value.
|X|      If the  Annuity  has been in effect  for less than  eight  complete  years,  a CDSC will be  charged  on the  amount of the
         Purchase Payment being withdrawn, according to the CDSC table.
|X|      If the  Annuity  has been in effect  for more than eight  complete  years,  no CDSC will be  charged  on the  amount  being
         withdrawn.

For purposes of  calculating  the CDSC on a partial  withdrawal,  the Purchase  Payments  being  withdrawn  may be greater than your
remaining  Account Value or the amount of your withdrawal  request.  This is most likely to occur if you have made prior withdrawals
under the Free Withdrawal provision or if your Account Value has declined in value due to negative market performance.

CAN I MAKE PERIODIC WITHDRAWALS FROM THE ANNUITY DURING THE ACCUMULATION PERIOD?
Yes. We call these "Systematic  Withdrawals." You can receive  Systematic  Withdrawals of earnings only,  principal plus earnings or
a flat  dollar  amount.  Systematic  Withdrawals  during  the  first  eight (8)  Annuity  Years may be  subject  to a CDSC.  We will
determine whether a CDSC applies and the amount in the same way as we would for a Partial Withdrawal.

Systematic  Withdrawals  can be made  from  Account  Value  allocated  to the  variable  investment  options  or Fixed  Allocations.
Generally,  Systematic  Withdrawals  from Fixed  Allocations  are  limited  to  earnings  accrued  after the  program of  Systematic
Withdrawals  begins, or payments of fixed dollar amounts that do not exceed such earnings.  Systematic  Withdrawals are available on
a monthly,  quarterly,  semi-annual  or annual basis.  The Surrender  Value of your Annuity must be at least $20,000  before we will
allow you to begin a program of Systematic Withdrawals.

The minimum  amount for each  Systematic  Withdrawal is $100. If any scheduled  Systematic  Withdrawal is for less than $100, we may
postpone  the  withdrawal  and add the  expected  amount to the amount  that is to be  withdrawn  on the next  scheduled  Systematic
Withdrawal.

DO YOU OFFER A PROGRAM FOR WITHDRAWALS UNDER SECTION 72(t) OF THE INTERNAL REVENUE CODE?
Yes. If your Annuity is used as a funding  vehicle for certain  retirement  plans that receive  special tax treatment under Sections
401,  403(b) or 408 of the Code,  Section  72(t) of the Code may provide an exception to the 10% penalty tax on  distributions  made
prior to age 59 1/2if you elect to  receive  distributions  as a series of  "substantially  equal  periodic  payments".  Distributions
received under this provision in any Annuity Year that exceed the maximum amount  available as a free  withdrawal will be subject to
a CDSC. We may apply a Market Value  Adjustment  to any Fixed  Allocations.  To request a program that complies with Section  72(t),
you must provide us with certain  required  information  in writing on a form  acceptable  to us. We may require  advance  notice to
allow us to calculate  the amount of 72(t)  withdrawals.  The  Surrender  Value of your Annuity must be at least  $20,000  before we
will allow you to begin a program for withdrawals under Section 72(t).  The minimum amount for any such withdrawal is $100.

You may also annuitize  your contract and begin  receiving  payments for the remainder of your life (or life  expectancy) as a means
of receiving income payments before age 59 1/2that are not subject to the 10% penalty.

WHAT ARE MINIMUM DISTRIBUTIONS AND WHEN WOULD I NEED TO MAKE THEM?
(See "Tax Considerations" for a further discussion of Minimum Distributions.)

Minimum Distributions are a type of Systematic  Withdrawal we allow to meet distribution  requirements under Sections 401, 403(b) or
408 of the Code.  Under the Code,  you may be required to begin  receiving  periodic  amounts from your  Annuity.  In such case,  we
will allow you to make  Systematic  Withdrawals  in amounts that satisfy the minimum  distribution  rules under the Code.  We do not
assess a CDSC on Minimum  Distributions  from your Annuity if you are required by law to take such Minimum  Distributions  from your
Annuity at the time it is taken.  However,  a CDSC may be  assessed  on that  portion of a  Systematic  Withdrawal  that is taken to
satisfy the minimum  distribution  requirements in relation to other savings or investment  plans under other  qualified  retirement
plans not maintained with American Skandia.

The  amount of the  required  Minimum  Distribution  for your  particular  situation  may  depend  on other  annuities,  savings  or
investments.  We will only  calculate  the amount of your  required  Minimum  Distribution  based on the value of your  Annuity.  We
require three (3) days advance  written notice to calculate and process the amount of your  payments.  You may elect to have Minimum
Distributions  paid out monthly,  quarterly,  semi-annually  or annually.  The $100 minimum that applies to  Systematic  Withdrawals
does not apply to Minimum Distributions.

You may also annuitize  your contract and begin  receiving  payments for the remainder of your life (or life  expectancy) as a means
of receiving income payments and satisfying the Minimum Distribution requirements under the Code.

CAN I SURRENDER MY ANNUITY FOR ITS VALUE?
Yes.  During the  accumulation  period you can surrender your Annuity at any time.  Upon  surrender,  you will receive the Surrender
Value.  Upon surrender of your Annuity, you will no longer have any rights under the Annuity.

For purposes of  calculating  the CDSC on  surrender,  the Purchase  Payments  being  withdrawn  may be greater than your  remaining
Account Value or the amount of your withdrawal  request.  This is most likely to occur if you have made prior  withdrawals under the
Free  Withdrawal  provision  or if your  Account  Value has  declined in value due to negative  market  performance.  We may apply a
Market Value Adjustment to any Fixed Allocations.

Under certain annuity payment options, you may be allowed to surrender your Annuity for its then current value.

To request the forms  necessary  to  surrender  your  Annuity,  contact our Customer  Service  Team at  1-800-680-8920  or visit our
Internet Website at www.americanskandia.prudential.com.

WHAT IS A MEDICALLY-RELATED SURRENDER AND HOW DO I QUALIFY?
Where  permitted by law, you may request to surrender  your Annuity prior to the Annuity Date without  application  of any CDSC upon
occurrence  of a  medically-related  "Contingency  Event".  We may apply a Market Value  Adjustment  to any Fixed  Allocations.  The
amount payable will be your Account Value.

This waiver of any applicable CDSC is subject to our rules, including but not limited to the following:
|X|      the Annuitant must be alive as of the date we pay the proceeds of such surrender request;
|X|      if the Owner is one or more natural persons, all such Owners must also be alive at such time;
|X|      we must receive  satisfactory  proof of the Annuitant's  confinement in a Medical Care Facility or Fatal Illness in writing
     on a form satisfactory to us; and
|X|      this benefit is not available if the total Purchase  Payments  received exceed $500,000 for all annuities issued by us with
     this benefit where the same person is named as Annuitant.

The  Annuitant  must have been named or any change of  Annuitant  must have been  accepted by us, prior to the  "Contingency  Event"
described above in order to qualify for a medically-related surrender.

The definitions of "Medical Care Facility" and "Fatal  Illness," as well as additional  terms and  conditions,  are provided in your
Annuity.  Specific details and definitions in relation to this benefit may differ in certain jurisdictions.

WHAT TYPES OF ANNUITY OPTIONS ARE AVAILABLE?
We currently make annuity options available that provide fixed annuity payments,  variable  payments or adjustable  payments.  Fixed
options  provide the same amount with each  payment.  Variable  options  generally  provide a payment which may increase or decrease
depending on the investment  performance of the Sub-accounts.  However,  currently,  we also make a variable payment option that has
a guarantee  feature.  Adjustable  options  provide a fixed payment that is periodically  adjusted based on current  interest rates.
We do not guarantee to make any annuity  payment  options  available in the future.  For additional  information on annuity  payment
options you may request a Statement of Additional Information.

When you purchase an Annuity,  or at a later date,  you may choose an Annuity Date,  an annuity  option and the frequency of annuity
payments.  You may change your  choices  before the Annuity  Date under the terms of your  contract.  A maximum  Annuity Date may be
required  by law.  The Annuity  Date may depend on the  annuity  option you choose.  Certain  annuity  options may not be  available
depending on the age of the Annuitant.

Certain of these annuity options may be available to  Beneficiaries  who choose to receive the Death Benefit proceeds as a series of
payments instead of a lump sum payment.

Option 1
Payments for Life:  Under this option,  income is payable  periodically  until the death of the "key life".  The "key life" (as used
in this  section) is the person or persons  upon whose life annuity  payments are based.  No  additional  annuity  payments are made
after the death of the key life.  Since no minimum  number of  payments is  guaranteed,  this  option  offers the largest  amount of
periodic  payments of the life  contingent  annuity  options.  It is possible  that only one payment will be payable if the death of
the key life occurs before the date the second  payment was due, and no other  payments nor death  benefits  would be payable.  This
Option is currently  available on a fixed or variable basis.  Under this option,  you cannot make a partial or full surrender of the
annuity.

Option 2
Payments Based on Joint Lives:  Under this option,  income is payable  periodically  during the joint lifetime of two key lives, and
thereafter  during the remaining  lifetime of the survivor,  ceasing with the last payment prior to the survivor's death. No minimum
number of payments is  guaranteed  under this option.  It is possible  that only one payment will be payable if the death of all the
key lives  occurs  before the date the second  payment was due,  and no other  payments  or death  benefits  would be payable.  This
Option is currently  available on a fixed or variable basis.  Under this option,  you cannot make a partial or full surrender of the
annuity.

Option 3
Payments for Life with a Certain  Period:  Under this option,  income is payable  until the death of the key life.  However,  if the
key life dies before the end of the period selected (5, 10 or 15 years),  the remaining  payments are paid to the Beneficiary  until
the end of such period.  This Option is  currently  available on a fixed or variable  basis.  If you elect to receive  payments on a
variable basis under this option,  you can request  partial or full surrender of the annuity and receive its then current cash value
(if any) subject to our rules.

Option 4
Fixed Payments for a Certain  Period:  Under this option,  income is payable  periodically  for a specified  number of years. If the
payee dies before the end of the specified  number of years,  the remaining  payments are paid to the  Beneficiary  until the end of
such period.  Note that under this option,  payments are not based on any assumptions of life  expectancy.  Therefore,  that portion
of the  Insurance  Charge  assessed  to cover the risk that key lives  outlive  our  expectations  provides  no  benefit to an Owner
selecting this option.  Under this option, you cannot make a partial or full surrender of the annuity.

Option 5
Variable  Payments for Life with a Cash Value:  Under this  option,  benefits  are payable  periodically  until the death of the key
life.  Benefits may  increase or decrease  depending  on the  investment  performance  of the  Sub-accounts.  This option has a cash
value that also varies with the  investment  performance  of the  Sub-account.  The cash value  provides a "cushion"  from  volatile
investment  performance so that negative investment  performance does not automatically  result in a decrease in the annuity payment
each month,  and positive  investment  performance does not  automatically  result in an increase in the annuity payment each month.
The cushion generally  "stabilizes"  monthly annuity payments.  Any cash value remaining on the death of the key life is paid to the
Beneficiary  in a lump sum or as periodic  payments.  Under this option,  you can request  partial or full  surrender of the annuity
and receive its then current cash value (if any) subject to our rules.


Option 6
Variable  Payments  for Life with a Cash Value and  Guarantee:  Under this  option,  benefits  are payable as described in Option 5;
except that,  while the key life is alive, the annuity payment will not be less than a guaranteed  amount,  which generally is equal
to the first annuity  payment.  We charge an additional  amount for this guarantee.  Under this option,  any cash value remaining on
the death of the key life is paid to the  Beneficiary  in a lump sum or as periodic  payments.  Under this  option,  you can request
partial or full surrender of the annuity and receive its then current cash value (if any) subject to our rules.

We may make additional annuity payment options available in the future.

HOW AND WHEN DO I CHOOSE THE ANNUITY PAYMENT OPTION?
Unless  prohibited  by law, we require that you elect either a life annuity or an annuity with a certain  period of at least 5 years
if any CDSC would apply were you to surrender  your  Annuity on the Annuity  Date.  Therefore,  choosing an Annuity Date within four
(4) years of the Issue Date of the Annuity may limit the available  annuity  payment  options.  Certain  annuity payment options may
not be available if your Annuity Date occurs during the period that a CDSC would apply.

If you have not provided us with your Annuity Date or annuity payment option in writing, then:
|X|      the Annuity Date will be the first day of the calendar month  following the later of the  Annuitant's  85th birthday or the
         fifth anniversary of our receipt of your request to purchase an Annuity; and
|X|      the annuity  payments,  where allowed by law, will be calculated on a fixed basis under Option 3, Payments for Life with 10
         years certain.

HOW ARE ANNUITY PAYMENTS CALCULATED?
Fixed Annuity Payments (Options 1-4)
If you choose to receive fixed annuity  payments,  you will receive equal  fixed-dollar  payments  throughout the period you select.
The amount of the fixed payment will vary  depending on the annuity  payment  option and payment  frequency  you select.  Generally,
the first annuity  payment is determined by  multiplying  the Account  Value,  minus any state premium taxes that may apply,  by the
factor  determined  from our table of annuity rates.  The table of annuity rates differs based on the type of annuity chosen and the
frequency of payment  selected.  Our rates will not be less than our guaranteed  minimum rates.  These guaranteed  minimum rates are
derived from the a2000 Individual  Annuity  Mortality Table with an assumed interest rate of 3% per annum.  Where required by law or
regulation,  such annuity  table will have rates that do not differ  according to the gender of the key life.  Otherwise,  the rates
will differ according to the gender of the key life.

Variable Annuity Payments
We offer three different  types of variable  annuity payment  options.  The first annuity payment will be calculated  based upon the
assumed  investment  return  ("AIR").  You select the AIR before we start to make  annuity  payments.  You will not receive  annuity
payments  until you choose an AIR. The remaining  annuity  payments will  fluctuate  based on the  performance  of the  Sub-accounts
relative to the AIR, as well as, other  factors  described  below.  The greater the AIR, the greater the first  annuity  payment.  A
higher  AIR may result in  smaller  potential  growth in the  annuity  payments.  A lower AIR  results  in a lower  initial  annuity
payment.  Within payment options 1-3, if the  Sub-accounts  you choose perform exactly the same as the AIR, then subsequent  annuity
payments  will be the same as the  first  annuity  payment.  If the  Sub-accounts  you  choose  perform  better  than the AIR,  then
subsequent  annuity  payments will be higher than the first annuity  payment.  If the Sub-accounts you choose perform worse than the
AIR,  then  subsequent  annuity  payments  will be lower  than the  first.  Within  payment  options 5 and 6, the cash value for the
Annuitant  (while alive) and a variable  period of time during which  annuity  payments will be made whether or not the Annuitant is
still alive are adjusted based on the performance of the Sub-accounts  relative to the AIR; however,  subsequent annuity payments do
not always increase or decrease based on the performance of the Sub-accounts relative to the AIR.

|X|      Variable Payments (Options 1-3)
         We calculate each annuity  payment amount by multiplying  the number of units  scheduled to be redeemed under a schedule of
         units for each  Sub-account by the Unit Value of each  Sub-account  on the annuity  payment date. We determine the schedule
         of units  based on your  Account  Value  (minus any  premium  tax that  applies)  at the time you elect to begin  receiving
         annuity  payments.  The  schedule  of units will vary  based on the  annuity  payment  option  selected,  the length of any
         certain  period  (if  applicable),  the  Annuitant's  age and  gender  (if  annuity  payments  are due for the  life of the
         Annuitant) and the Unit Value of the  Sub-accounts  you initially  selected on the Issue Date. The calculation is performed
         for each Sub-account,  and the sum of the Sub-account  calculations  equals the amount of your annuity payment.  Other than
         to fund annuity  payments,  the number of units allocated to each Sub-account will not change unless you transfer among the
         Sub-accounts or make a withdrawal (if allowed).  You can select one of three AIRs for these options: 3%, 5% or 7%.

|X|
     Stabilized Variable Payments (Option 5)
         This option provides  guaranteed  payments for life, a cash value for the Annuitant  (while alive) and a variable period of
         time during which  annuity  payments  will be made whether or not the  Annuitant is still alive.  We calculate  the initial
         annuity  payment amount by multiplying  the number of units  scheduled to be redeemed under a schedule of units by the Unit
         Values  determined on the  annuitization  date. The schedule of units is established for each Sub-account you choose on the
         annuitization date based on the applicable  benchmark rate,  meaning the AIR, and the annuity factors.  The annuity factors
         reflect our assumptions  regarding the costs we expect to bear in guaranteeing  payments for the lives of the Annuitant and
         will depend on the benchmark  rate, the annuitant's  attained age and gender (where  permitted).  Unlike variable  payments
         (described  above)  where each  payment  can vary based on  Sub-account  performance,  this  payment  option  cushions  the
         immediate  impact of  Sub-account  performance  by adjusting the length of the time during which  annuity  payments will be
         made whether or not the  Annuitant  is alive while  generally  maintaining  a level  annuity  payment  amount.  Sub-account
         performance that exceeds a benchmark rate will generally  extend this time period,  while  Sub-account  performance that is
         less than a benchmark  rate will  generally  shorten the period.  If the period  reaches  zero and the  Annuitant  is still
         alive,  Annuity  Payments  continue,  however,  the annuity payment amount will vary depending on Sub-account  performance,
         similar to conventional variable payments.  The AIR for this option is 4%.

|X|      Stabilized Variable Payments with a Guaranteed Minimum (Option 6)
         This option provides  guaranteed  payments for life in the same manner as Stabilized  Variable Payments  (described above).
         In addition to the  stabilization  feature,  this option also  guarantees that variable  annuity  payments will not be less
         than the initial annuity payment amount regardless of Sub-account performance.  The AIR for this option is 3%.

The variable  annuity payment options are described in greater detail in a separate  prospectus which will be provided to you at the
time you elect one of the variable annuity payment options.

Adjustable Annuity Payments
We may make an adjustable annuity payment option available.  Adjustable  annuity payments are calculated  similarly to fixed annuity
payments except that on every fifth (5th) anniversary of receiving  annuity payments,  the annuity payment amount is adjusted upward
or downward  depending on the rate we are currently  crediting to annuity  payments.  The  adjustment in the annuity  payment amount
does not affect the duration of remaining annuity payments, only the amount of each payment.

LIVING BENEFIT PROGRAMS

DO YOU OFFER PROGRAMS DESIGNED TO PROVIDE INVESTMENT PROTECTION FOR OWNERS WHILE THEY ARE ALIVE?
Yes. American Skandia offers three different optional benefits,  for an additional  charge,  that can provide investment  protection
for Owners while they are alive.  Each  optional  benefit  offers a distinct type of guarantee,  regardless  of the  performance  of
variable  investment  options,  that may be  appropriate  for you  depending  on the  manner in which you intend to make use of your
annuity while you are alive.  Depending on which  optional  benefit you choose,  you can have  substantial  flexibility to invest in
variable investment options while:
|X|      protecting a principal amount from decreases in value as of specified future dates;
|X|      taking withdrawals with a guarantee that you will be able to withdraw not less than a principal amount over time; or
|X|      guaranteeing  a minimum amount of growth will be applied to your  principal,  if it is to be used as the basis for lifetime
         income payments beginning after a waiting period.

Below is a brief summary of the three "living  benefits" that American Skandia offers.  Please refer to the benefit  description for
a complete  description of the terms,  conditions and limitations of each optional benefit.  You should consult with your investment
professional  to determine if any of these optional  benefits may be appropriate  for you based on your financial  needs.  There are
many factors to consider,  but we note that among them you may want to evaluate the tax  implications of these different  approaches
to meeting your needs,  both between these  benefits and in comparison to other  potential  solutions to your needs (e.g.  comparing
the tax implications of the withdrawal benefit and annuity payments).

I.       The Guaranteed Return Option PlusSM (GRO PlusSM)  guarantees that, after a seven-year period following  commencement of the
     program  ("maturity date") and on each anniversary of the maturity date thereafter,  the Owner's Account Value will not be less
     than the Account  Value on the effective  date of the program.  The program also offers the Owner the option to elect a second,
     enhanced  guarantee  amount at a higher Account Value subject to a separate  maturity period (and its  anniversaries).  The GRO
     PlusSM program may be appropriate if you wish to protect a principal  amount (called the "Protected  Principal  Value") against
     market downturns as of a specific date in the future, but also wish to exercise  substantial  control of the allocation of your
     Account Value amongst the variable  investment  options to participate in market increases.  Under the GRO PlusSM program,  you
     give us the right to allocate amounts to Fixed Allocations as needed to support the guarantees provided.

II.      The Guaranteed Minimum  Withdrawal  Benefit (GMWB) guarantees the Owner's ability to make cumulative  withdrawals over time
     equal to an initial principal value (called the "Protected  Withdrawal  Value"),  regardless of decreases in your Account Value
     due to market  losses.  The GMWB program may be appropriate  if you intend to make periodic  withdrawals  from your Annuity and
     wish to ensure that market  performance  will not affect your ability to protect your principal.  Taking income as withdrawals,
     rather than annuity  payments,  may be less tax efficient for non-qualified  uses of the Annuity,  but provides greater control
     over the timing and amount of withdrawals  during the accumulation  period, as well as continuing the Annuity's other benefits,
     such as the death benefit.

III.     The Guaranteed  Minimum Income Benefit (GMIB) guarantees the Owner's ability,  after a minimum  seven-year  waiting period,
     to begin  receiving  income from the Annuity in the form of annuity  payments  based on a guaranteed  minimum value (called the
     "Protected  Income Value") that increases  after the waiting period begins,  regardless of the impact of market  performance on
     your Account Value.  The GMIB program may be  appropriate  if you anticipate  using your Annuity as a future source of periodic
     fixed income  payments for the remainder of your life and wish to ensure that the basis upon which your income payments will be
     calculated will achieve at least a minimum amount of growth despite fluctuations in market performance.

The GRO PlusSM,  GMWB or GMIB programs may only be elected  individually,  and cannot be elected in combination with each other. Any
of the  living  benefits  can be  elected  with any of the  optional  death  benefits  we  currently  make  available.  We deduct an
additional  charge if you elect any of these optional benefits to compensate  American Skandia for the additional  insurance risk we
assume in providing the applicable guarantee under each optional benefit.

GUARANTEED RETURN OPTION PlusSM (GRO PlusSM)

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The  Guaranteed  Return Option Plus  described  below is being  offered in those  jurisdictions  where we have  received  regulatory
approval,  and will be offered  subsequently in other  jurisdictions  when we receive  regulatory  approval in those  jurisdictions.
Certain terms and  conditions may differ between  jurisdictions  once approved.  The program can be elected by new purchasers on the
Issue Date of their  Annuity,  and can be elected by existing  Annuity  Owners on either the  anniversary of the Issue Date of their
Annuity or on a date other than that  anniversary,  as  described  below under  "Election of the  Program".  The  Guaranteed  Return
Option Plus is not available if you elect the Guaranteed  Return Option rider, the Guaranteed  Minimum  Withdrawal  Benefit rider or
the Guaranteed Minimum Income Benefit rider.
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We offer a program that,  after a seven-year  period  following  commencement of the program (we refer to the end of that seven-year
period as the "maturity date") and on each  anniversary of the maturity date  thereafter,  guarantees your Account Value will not be
less than your Account  Value on the effective  date of your program  (called the  "Protected  Principal  Value").  The program also
offers you the  opportunity  to elect a second,  enhanced  guaranteed  amount at a later date if your Account  Value has  increased,
while preserving the guaranteed  amount  established on the effective date of your program.  The enhanced  guaranteed amount (called
the "Enhanced  Protected  Principal Value")  guarantees that, after a separate  seven-year period following election of the enhanced
guarantee and on each anniversary  thereafter,  your Account Value will not be less than your Account Value on the effective date of
your election of the enhanced guarantee.

The program  monitors your Account Value daily and, if necessary,  systematically  transfers  amounts  between  variable  investment
options you choose and Fixed  Allocations used to support the Protected  Principal  Value(s).  The program may be appropriate if you
wish to protect a principal  amount  against  market  downturns as of a specific date in the future,  but also wish to invest in the
variable  investment  options to participate in market  increases.  There is an additional charge if you elect the Guaranteed Return
Option Plus program.

The  guarantees  provided by the program  exist only on the  applicable  maturity  date(s) and on each  anniversary  of the maturity
date(s)  thereafter.  However,  due to the ongoing  monitoring  of your  Account  Value and the  transfer of Account  Value  between
variable  investment  options and Fixed Allocations to support our future  guarantees,  the program may provide some protection from
significant market losses if you choose to surrender the Annuity or begin receiving annuity payments prior to a maturity date.

KEY FEATURE - Protected Principal Value/Enhanced Protected Principal Value
The Guaranteed Return Option Plus offers a base guarantee as well as the option of electing an enhanced guarantee at a later date.
|X|      Base Guarantee:  Under the base guarantee,  American  Skandia  guarantees that on the maturity date and on each anniversary
     of the maturity date thereafter, your Account Value will be no less than the Protected Principal Value.
     On the maturity date and on each  anniversary  after the maturity date, if your Account Value is below the Protected  Principal
     Value,  American Skandia will apply additional  amounts to your Annuity from its general account to increase your Account Value
     to be equal to the Protected Principal Value.

|X|      Enhanced  Guarantee:  On any anniversary  following  commencement of the program,  you can establish an enhanced guaranteed
     amount based on your current Account Value.  Under the enhanced  guarantee,  American Skandia guarantees that at the end of the
     seven year period  following the election of the enhanced  guarantee  (also  referred to as its "maturity  date"),  and on each
     anniversary of the maturity date thereafter,  your Account Value will be no less than the Enhanced  Protected  Principal Value.
     You can elect an enhanced  guarantee  more than once;  however,  a  subsequent  election  supersedes  the prior  election of an
     enhanced  guarantee.  Election of an enhanced  guarantee  does not impact the base  guarantee.  In  addition,  you may elect an
     "auto step-up" feature that will automatically  increase your base guarantee (or enhanced guarantee,  if previously elected) on
     each  anniversary of the program (and create a new, seven year maturity  period for the new enhanced  guarantee) if the Account
     Value as of that  anniversary  exceeds the existing base  guarantee  (or enhanced  guarantee,  if previously  elected) by 7% or
     more.  You may also elect to  terminate an enhanced  guarantee.  If you elect to terminate  the  enhanced  guarantee,  the base
     guarantee will remain in effect.
     If you have elected the enhanced  guarantee,  on the  guarantee's  maturity date and on each  anniversary  of the maturity date
     thereafter,  if your Account Value is below the Enhanced  Protected  Principal  Value,  American  Skandia will apply additional
     amounts to your  Annuity  from its  general  account to  increase  your  Account  Value to be equal to the  Enhanced  Protected
     Principal Value.

Any  amounts  added to your  Annuity  will be applied,  if  necessary,  to any Fixed  Allocations  needed to support the  applicable
guarantee  amount as of the  maturity  date or any  anniversary  of the  maturity  date.  Any  remaining  amounts  will be allocated
pro-rata to your  Account  Value based on your  current  Sub-account  allocations.  We will notify you of any amounts  added to your
Annuity  under the  program.  The  Protected  Principal  Value is referred to as the "Base  Guarantee"  and the  Enhanced  Protected
Principal Value is referred to as the "Step-up Guarantee" in the rider we issue for this benefit.

Withdrawals under your Annuity
Withdrawals  from your  Annuity,  while the program is in effect,  will reduce the base  guarantee  under the program as well as any
enhanced  guarantee.  Cumulative  annual  withdrawals  up to 5% of the Protected  Principal  Value as of the  effective  date of the
program  (adjusted  for any  subsequent  Purchase  Payments  and any  Credits  applied to such  Purchase  Payments)  will reduce the
applicable  guaranteed amount by the actual amount of the withdrawal (referred to as the  "dollar-for-dollar  limit"). If the amount
withdrawn is greater than the dollar-for-dollar  limit, the portion of the withdrawal equal to the  dollar-for-dollar  limit will be
treated as  described  above,  and the  portion of the  withdrawal  in excess of the  dollar-for-dollar  limit will  reduce the base
guarantee and the enhanced  guarantee  proportionally,  according to the formula as described in the rider for this benefit (see the
examples  of this  calculation  below).  Withdrawals  will be taken  pro-rata  from the  variable  investment  options and any Fixed
Allocations.  Withdrawals  will be subject to all other  provisions of the Annuity,  including any Contingent  Deferred Sales Charge
or Market Value Adjustment that would apply.

Charges  for other  optional  benefits  under the  Annuity  that are  deducted  as an annual  charge in arrears  will not reduce the
applicable guaranteed amount under the Guaranteed Return Option Plus program.

The following examples of  dollar-for-dollar  and proportional  reductions assume that: 1.) the Issue Date and the effective date of
the GRO PlusSM program are October 13, 2003; 2.) an initial Purchase  Payment of $250,000;  3.) a base guarantee amount of $250,000;
and 4.) a dollar-for-dollar limit of $12,500 (5% of $250,000):

Example 1. Dollar-for-dollar reduction

A $10,000  withdrawal  is taken on November 29, 2003 (in the first  Annuity  Year).  No prior  withdrawals  have been taken.  As the
amount withdrawn is less than the Dollar-for-dollar Limit:
o        The base guarantee amount is reduced by the amount withdrawn (i.e., by $10,000, from $250,000 to $240,000).
o        The  remaining  dollar-for-dollar  limit  ("Remaining  Limit") for the balance of the first Annuity Year is also reduced by
         the amount withdrawn (from $12,500 to $2,500).

Example 2. Dollar-for-dollar and proportional reductions

A second  $10,000  withdrawal  is taken on December 18, 2003 (still within the first Annuity  Year).  The Account Value  immediately
before the withdrawal is $180,000.  As the amount withdrawn exceeds the Remaining Limit of $2,500 from Example 1:
o        the base guarantee amount is first reduced by the Remaining Limit (from $240,000 to $237,500);
o        The result is then further reduced by the ratio of A to B, where:
o        A is the amount withdrawn less the Remaining Limit ($10,000 - $2,500, or $7,500).
o        B is the Account Value less the Remaining Limit ($180,000 - $2,500, or $177,500).
     The resulting base guarantee amount is: $237,500 x ( 1 - $7,500 / $177,500), or $227,464.79.
o        The Remaining Limit is set to zero (0) for the balance of the first Annuity Year.

Example 3. Reset of the Dollar-for-dollar Limit

A  $10,000  withdrawal  is  made  on  December  19,  2004  (second  Annuity  Year).  The  Remaining  Limit  has  been  reset  to the
dollar-for-dollar limit of $12,500. As the amount withdrawn is less than the dollar-for-dollar limit:
o        The base guarantee amount is reduced by the amount withdrawn (i.e., reduced by $10,000, from $227,464.79 to $217,464.79).
o        The Remaining  Limit for the balance of the second  Annuity Year is also reduced by the amount  withdrawn  (from $12,500 to
         $2,500).

KEY FEATURE - Allocation of Account Value
In general,  you have  discretion  over the  allocation  of your  Account  Value that remains  allocated in the variable  investment
options.  However,  we reserve the right to prohibit  investment in certain  Portfolios if you  participate in the program.  Account
Value is only transferred to and maintained in Fixed  Allocations to the extent we, in our sole discretion,  deem it is necessary to
support our  guarantee(s)  under the program.  This permits your Annuity to participate in the upside  potential of the Sub-accounts
while only transferring  amounts to Fixed Allocations to protect against  significant market downturns.  We monitor  fluctuations in
your Account Value each business day, as well as the  prevailing  interest  rates on Fixed  Allocations,  the remaining  duration(s)
until the applicable maturity date(s) and the amount of Account Value allocated to Fixed  Allocation(s)  relative to a "reallocation
trigger",  which  determines  whether Account Value must be transferred to or from Fixed  Allocation(s).  While you are not notified
when your Account Value reaches a  reallocation  trigger,  you will receive a  confirmation  statement  indicating the transfer of a
portion of your Account Value either to or from Fixed Allocation(s).

|X|      If your Account Value is greater than or equal to the reallocation  trigger,  your Account Value in the variable investment
     options  will  remain  allocated  according  to your most recent  instructions.  If a portion of Account  Value was  previously
     allocated  to a Fixed  Allocation  to support  the  applicable  guaranteed  amount,  all or a portion of those  amounts  may be
     transferred from the Fixed Allocation and re-allocated to the variable  investment  options pro-rata  according to your current
     allocations  (including  the model  allocations  under any asset  allocation  program  you may have  elected).  A Market  Value
     Adjustment will apply when we reallocate Account Value from a Fixed Allocation to the variable  investment  options,  which may
     result in a decrease or increase in your Account Value.

|X|      If your Account Value is less than the  reallocation  trigger,  a portion of your Account Value in the variable  investment
     options will be  transferred  to a new Fixed  Allocation(s)  to support the  applicable  guaranteed  amount.  These amounts are
     transferred  on a pro-rata  basis from the  variable  investment  options.  The new Fixed  Allocation(s)  will have a Guarantee
     Period  equal to the time  remaining  until the  applicable  maturity  date(s).  The Account  Value  allocated to the new Fixed
     Allocation(s)  will be credited with the fixed interest  rate(s) then being credited to a new Fixed  Allocation(s)  maturing on
     the applicable  maturity date(s) (rounded to the next highest yearly duration).  The Account Value will remain invested in each
     applicable Fixed Allocation until the applicable  maturity date unless,  at an earlier date, your Account Value is greater than
     or equal to the  reallocation  trigger and,  therefore,  amounts can be  transferred to the variable  investment  options while
     maintaining the guaranteed protection under the program (as described above).

====================================================================================================================================
If a  significant  amount of your  Account  Value is  systematically  transferred  to Fixed  Allocations  to support  the  Protected
Principal Value and/or the Enhanced  Protected  Principal Value during prolonged market declines,  less of your Account Value may be
immediately  available to participate in the upside  potential of the variable  investment  options if there is a subsequent  market
recovery.  During the period prior to the maturity  date of the base  guarantee or any enhanced  guarantee,  or any  anniversary  of
such maturity date(s),  a significant  portion of your Account Value may be allocated to Fixed Allocations to support any applicable
guaranteed  amount(s).  If your Account Value is less than the  reallocation  trigger and new Fixed  Allocations must be established
during  periods where the interest  rate(s) being  credited to such Fixed  Allocations  is extremely  low, a larger  portion of your
Account Value may need to be transferred to Fixed Allocations to support the applicable guaranteed amount(s).
====================================================================================================================================

Separate Fixed  Allocations  may be established in support of the Protected  Principal  Value and the Enhanced  Protected  Principal
Value (if elected).  There may also be  circumstances  when a Fixed  Allocation will be established only in support of the Protected
Principal Value or the Enhanced  Protected  Principal  Value. If you elect an enhanced  guarantee,  it is more likely that a portion
of your Account  Value may be allocated to Fixed  Allocations  and will remain  allocated for a longer period of time to support the
Enhanced  Protected  Principal Value, even during a period of positive market  performance  and/or under  circumstances  where Fixed
Allocations  would not be necessary to support the  Protected  Principal  Value.  Further,  there may be  circumstances  where Fixed
Allocations in support of the Protected  Principal Value are transferred to the variable  investment options while Fixed Allocations
in support of an Enhanced  Protected  Principal Value are not transferred  because they must remain invested in the Fixed Allocation
in support of the higher enhanced guarantee.

American  Skandia uses an allocation  mechanism  based on  assumptions  of expected and maximum  market  volatility to determine the
reallocation  trigger.  The allocation  mechanism is used to determine the allocation of Account Value between Fixed Allocations and
the Sub-accounts you choose.  American  Skandia reserves the right to change the allocation  mechanism and the reallocation  trigger
at its  discretion,  subject to regulatory  approval where required.  Changes to the allocation  mechanism  and/or the  reallocation
trigger may be applied to existing programs where allowed by law.

Election of the Program
The  Guaranteed  Return  Option Plus  program can be elected at the time that you  purchase  your  Annuity,  or on any  business day
thereafter (prior to  annuitization).  If you elect the program after the Issue Date of your Annuity,  the program will be effective
as of the business day that we receive the required  documentation in good order at our home office,  and the guaranteed amount will
be based on your Account Value as of that date. If you  previously  elected the  Guaranteed  Return Option program and wish to elect
the  Guaranteed  Return  Option Plus  program,  your prior  Guaranteed  Return  Option  program will be  terminated  (including  the
guaranteed  amount(s))  and the  Guaranteed  Return Option Plus program will be added to your Annuity  based on the current  Account
Value.  This election of GRO PlusSM may result in a market value adjustment, which could increase or decrease your Account Value.

Termination of the Program
The Annuity Owner can elect to terminate the enhanced  guarantee but maintain the  protection  provided by the base  guarantee.  The
Annuity Owner also can terminate the  Guaranteed  Return Option Plus program  entirely.  An Annuity Owner who terminates the program
entirely can  subsequently  elect to  participate  in the program again (based on the Account Value on that date) by furnishing  the
documentation we require.  In a rising market,  an Annuity Owner could,  for example,  terminate the program on a given business day
and two weeks later  reinstate  the program  with a higher base  guarantee  (and a new  maturity  date).  However,  your  ability to
reinstate the program is limited by the  following:  (A) in any Annuity  Year, we do not permit more than two program  elections and
(B) a program reinstatement cannot be effected on the same business day on which a program termination was effected.

The program will terminate  automatically  upon: (a) the death of the Owner or the Annuitant (in an entity owned  contract);  (b) as
of the date  Account  Value is applied  to begin  annuity  payments;  or (c) upon full  surrender  of the  Annuity.  If you elect to
terminate the program prior to the applicable  maturity  date, the Guaranteed  Return Option Plus will no longer provide a guarantee
of your  Account  Value.  The  surviving  spouse  may elect the  benefit  at any time  after the  death of the  Annuity  Owner.  The
surviving  spouse's  election will be effective on the business day that we receive the required  documentation in good order at our
home office, and the Account Value on that business day will be the Protected Principal Value.

The charge for the  Guaranteed  Return Option Plus program will no longer be deducted from your Account  Value upon  termination  of
the program.


Special Considerations under the Guaranteed Return Option Plus
This program is subject to certain rules and restrictions, including, but not limited to the following:
|X|      Upon inception of the program,  100% of your Account Value must be allocated to the variable  investment  options. No Fixed
     Allocations may be in effect as of the date that you elect to participate in the program.  However,  the  reallocation  trigger
     may transfer Account Value to Fixed Allocations as of the effective date of the program under some circumstances.
|X|      Annuity Owners cannot  allocate any portion of Purchase  Payments or transfer  Account Value to or from a Fixed  Allocation
     while  participating in the program,  and cannot  participate in any dollar cost averaging program that transfers Account Value
     from a Fixed Allocation to the variable investment options.
|X|      Additional  Purchase Payments  (including any credits  associated with such Purchase Payments) applied to the Annuity while
     the program is in effect will increase the applicable  guarantee amount by the actual amount of the Purchase Payment;  however,
     all or a portion of any additional  Purchase  Payments  (including any credits  associated with such Purchase  Payments) may be
     allocated by us to Fixed Allocations to support the additional amount guaranteed.
|X|      Transfers from Fixed  Allocations will be subject to the Market Value Adjustment  formula under the Annuity;  however,  the
     0.10%  "cushion"  feature of the  formula  will not apply.  A Market  Value  Adjustment  may be either  positive  or  negative.
     Transfer amounts will be taken from the most recently applied Fixed Allocation.
|X|      Transfers from the Sub-accounts to Fixed Allocations or from Fixed  Allocations to the Sub-accounts  under the program will
     not count toward the maximum number of free transfers allowable under the Annuity.
|X|      Any amounts  applied to your Account  Value by American  Skandia on the maturity  date or any  anniversary  of the maturity
     date will not be treated as "investment in the contract" for income tax purposes.

Charges under the Program
We deduct a charge equal to 0.25% of Account  Value per year to  participate  in the  Guaranteed  Return  Option Plus  program.  The
annual  charge is deducted  daily  against your  Account  Value  allocated to the  Sub-accounts.  Account  Value  allocated to Fixed
Allocations  under the program is not subject to the charge.  The charge is deducted to  compensate  American  Skandia  for: (a) the
risk that your Account Value on the maturity date is less than the amount guaranteed; and (b) administration of the program.

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In those  jurisdictions  where we have not received  regulatory  approval for the Guaranteed Return Option Plus rider, we may offer,
where  available,   the  Guaranteed  Return  Option  rider  described  below.  Certain  terms  and  conditions  may  differ  between
jurisdictions.  The  Guaranteed  Return Option rider is not  available if you elect the  Guaranteed  Return  Option Plus rider,  the
Guaranteed Minimum Withdrawal Benefit rider or the Guaranteed Minimum Income Benefit rider.
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Guaranteed Return Option (GRO)SM
We also offer a seven-year  program  where we monitor your Account Value daily and  systematically  transfer  amounts  between Fixed
Allocations and the variable  investment  options you choose.  American Skandia guarantees that at the end of the seventh (7th) year
from  commencement  of the program (or any program  restart date),  you will receive no less than your Account Value on the date you
elected to  participate  in the program  ("commencement  value").  On the program  maturity date, if your Account Value is below the
commencement  value,  American  Skandia will apply additional  amounts to your Annuity so that it is equal to commencement  value or
your  Account  Value on the date you elect to restart the program  duration.  Any amounts  added to your  Annuity will be applied to
the AST Money Market Sub-account,  unless you provide us with alternative  instructions.  We will notify you of any amounts added to
your Annuity  under the program.  We do not consider  amounts  added to your Annuity to be  "investment  in the contract" for income
tax purposes.

Account Value is only  transferred  to and  maintained in Fixed  Allocations  to the extent we, in our sole  discretion,  deem it is
necessary to support our  guarantee  under the program.  This differs  from the Balanced  Investment  Program  where a set amount is
allocated to a Fixed Allocation  regardless of the performance of the underlying  Sub-accounts.  With the Guaranteed  Return Option,
your  Annuity  is able to  participate  in the  upside  potential  of the  Sub-accounts  while  only  transferring  amounts to Fixed
Allocations  to  protect  against  significant  market  downturns.   NOTE:  If  a  significant  amount  of  your  Account  Value  is
systematically  transferred to Fixed  Allocations  during prolonged  market declines,  less of your Account Value may be immediately
available to participate in the upside potential of the Sub-accounts if there is a subsequent market recovery.

Each business day we monitor the  performance of your Account Value to determine  whether it is greater than,  equal to or below our
"reallocation  trigger",  described  below.  Based on the  performance  of the  Sub-accounts  in which you choose to  allocate  your
Account  Value  relative  to the  reallocation  trigger,  we may  transfer  some or all of  your  Account  Value  to or from a Fixed
Allocation.  You have  complete  discretion  over the  allocation  of your  Account  Value that  remains  allocated  in the variable
investment options.  However, we reserve the right to restrict certain Portfolios if you participate in the program.

|X|      Account  Value  greater than or equal to  reallocation  trigger:  Your Account  Value in the  variable  investment  options
              remains allocated according to your most recent  instructions.  If a portion of Account Value was previously allocated
              to a Fixed  Allocation,  those amounts may be transferred  from the Fixed  Allocation and re-allocated to the variable
              investment options pro-rata according to your current allocations.  A Market Value Adjustment will apply.

|X|      Account  Value  below  reallocation  trigger:  A portion  of your  Account  Value in the  variable  investment  options  is
              transferred  to a new  Fixed  Allocation.  These  amounts  are  transferred  on a  pro-rata  basis  from the  variable
              investment  options.  The new Fixed  Allocation  will have a Guarantee  Period equal to the remaining  duration in the
              Guaranteed  Return  Option.  The Account  Value  applied to the new Fixed  Allocation  will be credited with the fixed
              interest rate then being  applied to a new Fixed  Allocation  of the next higher  yearly  duration.  The Account Value
              will remain invested in the Fixed Allocation  until the maturity date of the program unless,  at an earlier date, your
              Account  Value is at or above the  reallocation  trigger and amounts can be  transferred  to the  variable  investment
              options (as described above) while maintaining the guarantee protection under the program.

American  Skandia uses an allocation  mechanism  based on  assumptions  of expected and maximum  market  volatility to determine the
reallocation  trigger.  The allocation  mechanism is used to determine the allocation of Account Value between Fixed Allocations and
the Sub-accounts you choose.  American  Skandia reserves the right to change the allocation  mechanism and the reallocation  trigger
at its discretion,  subject to regulatory  approval where required.  Any change to the allocation  mechanism and/or the reallocation
trigger will only apply to programs that begin after the change is effective.

Program Termination
The Guaranteed  Return Option will  terminate on its maturity  date. You can elect to participate in a new Guaranteed  Return Option
or re-allocate  your Account Value at that time.  Upon  termination,  any Account Value allocated to the Fixed  Allocations  will be
transferred to the AST Money Market Sub-account, unless you provide us with alternative instructions.

Special Considerations under the Guaranteed Return Option
This program is subject to certain rules and restrictions, including, but not limited to the following:
|X|      You may  terminate  the  Guaranteed  Return  Option at any time.  American  Skandia  does not provide any  guarantees  upon
     termination of the program.
|X|      Withdrawals  from your  Annuity  while the  program is in effect  will reduce the  guaranteed  amount  under the program in
     proportion  to your Account Value at the time of the  withdrawal.  Withdrawals  will be subject to all other  provisions of the
     Annuity, including any Contingent Deferred Sales Charge or Market Value Adjustment that would apply.
|X|      Additional  Purchase  Payments  applied  to the  Annuity  while the  program  is in effect  will only  increase  the amount
     guaranteed; however, all or a portion of any additional Purchase Payments may be allocated to the Fixed Allocations.
|X|      Annuity Owners cannot transfer Account Value to or from a Fixed  Allocation  while  participating in the program and cannot
     participate  in any dollar cost  averaging  program  that  transfers  Account  Value from a Fixed  Allocation  to the  variable
     investment options.
|X|      Transfers from Fixed  Allocations will be subject to the Market Value Adjustment  formula under the Annuity;  however,  the
     0.10%  "cushion"  feature of the  formula  will not apply.  A Market  Value  Adjustment  may be either  positive  or  negative.
     Transfer amounts will be taken from the most recently applied Fixed Allocation.
|X|      Transfers from the Sub-accounts to Fixed Allocations or from Fixed  Allocations to the Sub-accounts  under the program will
     not count toward the maximum number of free transfers allowable under the Annuity.
|X|      The  Guaranteed  Return  Option  will  terminate:  (a) upon the death of the  Owner or the  Annuitant  (in an entity  owned
     contract); and (b) as of the date Account Value is applied to begin annuity payments.
|X|      You can elect to restart the seven (7) year  program  duration on any  anniversary  of the Issue Date of the  Annuity.  The
     Account  Value on the date the restart is  effective  will become the new  commencement  value.  You can only elect the program
     once per Annuity Year.

Charges under the Guaranteed Return Option Program
We deduct a charge equal to 0.25% per year to  participate  in the  Guaranteed  Return  Option.  The annual charge is deducted daily
against your Account Value allocated to the  Sub-accounts.  In certain states,  the charge is deducted in arrears on an annual basis
on each  anniversary  of the Issue Date of the  Annuity.  Account  Value  allocated  to Fixed  Allocations  under the program is not
subject to the charge.  The charge is deducted to  compensate  American  Skandia for:  (a) the risk that your  Account  Value on the
maturity date of the program is less than the amount guaranteed; and (b) administration of the program.

GUARANTEED MINIMUM WITHDRAWAL BENEFIT (GMWB)

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The Guaranteed  Minimum Withdrawal  Benefit program described below is being offered in those  jurisdictions  where we have received
regulatory  approval  and  will be  offered  subsequently  in other  jurisdictions  when we  receive  regulatory  approval  in those
jurisdictions.  Certain terms and conditions  may differ between  jurisdictions  once approved.  Currently,  the program can only be
elected by new  purchasers on the Issue Date of their  Annuity.  We may offer the program to existing  Annuity Owners in the future,
subject to our  eligibility  rules and  restrictions.  The Guaranteed  Minimum  Withdrawal  Benefit  program is not available if you
elect the Guaranteed Return Option, Guaranteed Return Option Plus, or the Guaranteed Minimum Income Benefit rider.
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We offer a program that  guarantees  your ability to withdraw  amounts equal to an initial  principal  value (called the  "Protected
Withdrawal  Value"),  regardless of the impact of market  performance on your Account Value,  subject to our program rules regarding
the timing and amount of withdrawals.  The program may be appropriate if you intend to make periodic  withdrawals  from your Annuity
and wish to ensure that market  performance  will not affect your  ability to protect your  principal.  You are not required to make
withdrawals as part of the program - the guarantee is not lost if you withdraw less than the maximum  allowable  amount of principal
each year under the rules of the program.  There is an additional charge if you elect the GMWB program;  however,  the charge may be
waived under certain circumstances described below.

KEY FEATURE - Protected Withdrawal Value
The  Protected  Withdrawal  Value is the total amount that we  guarantee  will be  available  to you through  withdrawals  from your
Annuity and/or benefit  payments,  regardless of the impact of market  performance on your Account Value.  The Protected  Withdrawal
Value is reduced  with each  withdrawal  you make until the  Protected  Withdrawal  Value is  reduced  to zero.  When the  Protected
Withdrawal Value is reduced to zero due to your withdrawals,  the GMWB program terminates.  Additionally,  the Protected  Withdrawal
Value is used to  determine  the  maximum  annual  amount that you can  withdraw  from your  Annuity,  called the  Protected  Annual
Withdrawal Amount,  without triggering an adjustment in the Protected  Withdrawal Value. The Protected  Withdrawal Value is referred
to as the "Benefit Base" in the rider we issue for this benefit.

The  Protected  Withdrawal  Value is  determined  as of the date you make your first  withdrawal  under the Annuity  following  your
election of the GMWB program.  The initial  Protected  Withdrawal Value is equal to the greater of (A) the Account Value on the date
you elect the GMWB program,  plus any  additional  Purchase  Payments and any Credits that may be applied to such Purchase  Payments
before the date of your first  withdrawal;  or (B) the Account Value as of the date of the first  withdrawal from your Annuity.  The
Protected  Withdrawal Value may be enhanced by increases in your Account Value due to market  performance  during the period between
your election of the GMWB program and the date of your first withdrawal.

|X|      If you elect the GMWB program at the time you  purchase  your  Annuity,  the Account  Value will be your  initial  Purchase
     Payment plus any Credit applied to such Purchase Payment.

|X|      If we offer the GMWB program to existing  Annuity  Owners,  the Account Value on the  anniversary of the Issue Date of your
     Annuity following your election of the GMWB program will be used to determine the initial Protected Withdrawal Value.

|X|      If you make additional Purchase Payments after your first withdrawal,  the Protected  Withdrawal Value will be increased by
     the amount of the additional Purchase Payment and any Credits that we apply to the Purchase Payment.

You may elect to step-up your  Protected  Withdrawal  Value if, due to positive  market  performance,  your Account Value is greater
than the  Protected  Withdrawal  Value.  You are  eligible to step-up the  Protected  Withdrawal  Value on or after the 5th contract
anniversary  following the first  withdrawal  under the GMWB program.  The Protected  Withdrawal Value can be stepped up again on or
after the 5th contract  anniversary  following the preceding  step-up.  If you elect to step-up the Protected  Withdrawal Value, you
must do so during the 30-day period prior to your  eligibility  date. If you elect to step-up the Protected  Withdrawal  Value under
the  program,  and on the date you elect to step-up,  the charges  under the GMWB  program  have  changed for new  purchasers,  your
program may be subject to the new charge going forward.

Upon election of the step-up,  we reset the Protected  Withdrawal  Value to be equal to the then current Account Value. For example,
assume your initial  Protected  Withdrawal  Value was $100,000 and you have made  cumulative  withdrawals  of $40,000,  reducing the
Protected  Withdrawal Value to $60,000.  On the date you are eligible to step-up the Protected  Withdrawal Value, your Account Value
is equal to  $75,000.  You could elect to step-up  the  Protected  Withdrawal  Value to $75,000 on the date you are  eligible.  Upon
election of the step-up,  we also reset the Protected Annual  Withdrawal  Amount  (discussed  immediately  below) to be equal to the
greater of (A) the Protected Annual Withdrawal Amount  immediately prior to the reset; and (B) 7% of the Protected  Withdrawal Value
immediately after the reset.

KEY FEATURE - Protected Annual Withdrawal Amount
The initial  Protected Annual Withdrawal Amount is equal to 7% of the Protected  Withdrawal Value.  Under the GMWB program,  if your
cumulative  withdrawals  each  Annuity  Year are less  than or equal to the  Protected  Annual  Withdrawal  Amount,  your  Protected
Withdrawal Value will be reduced on a  "dollar-for-dollar"  basis (the Protected Withdrawal Value is reduced by the actual amount of
the  withdrawal,  including any CDSC or MVA that may apply).  Cumulative  withdrawals  in any Annuity Year that exceed the Protected
Annual  Withdrawal  Amount  trigger a  proportional  adjustment to both the  Protected  Withdrawal  Value and the  Protected  Annual
Withdrawal  Amount,  as described in the rider for this benefit (see the examples of this calculation  below).  The Protected Annual
Withdrawal Amount is referred to as the "Maximum Annual Benefit" in the rider we issue for this benefit.

The GMWB program does not affect your ability to make  withdrawals  under your Annuity or limit your ability to request  withdrawals
that exceed the Protected  Annual  Withdrawal  Amount.  You are not required to withdraw all or any portion of the Protected  Annual
Withdrawal Amount each Annuity Year.
|X|      If,  cumulatively,  you withdraw an amount less than the Protected Annual Withdrawal Amount in any Annuity Year, you cannot
     carry-over the unused portion of the Protected  Annual  Withdrawal  Amount to subsequent  Annuity Years.  However,  because the
     Protected Withdrawal Value is only reduced by the actual amount of withdrawals you make under these  circumstances,  any unused
     Protected Annual Withdrawal Amount may extend the period of time until the remaining  Protected  Withdrawal Value is reduced to
     zero.
|X|      Additional  Purchase  Payments  will increase the  Protected  Annual  Withdrawal  Amount by 7% of the  applicable  Purchase
     Payment (and any Credits we apply to such Purchase Payment).
|X|      If the Protected  Annual  Withdrawal  Amount after an  adjustment  exceeds the Protected  Withdrawal  Value,  the Protected
     Annual Withdrawal Amount will be set equal to the Protected Withdrawal Value.

The following  examples of dollar-for  dollar and  proportional  reductions and the reset of the Maximum Annual Benefit assume that:
1.) the Issue Date and the effective  date of the GMWB program are October 13, 2003;  2.) an initial  Purchase  Payment of $250,000;
3.) a Protected Withdrawal Value of $250,000; and 4.) a Protected Annual Withdrawal Amount of $17,500 (7% of $250,000):

Example 1. Dollar-for-dollar reduction

A $10,000  withdrawal  is taken on November 13, 2003 (in the first  Annuity  Year).  No prior  withdrawals  have been taken.  As the
amount withdrawn is less than the Protected Annual Withdrawal Amount:
o        The Protected Withdrawal Value is reduced by the amount withdrawn (i.e., by $10,000, from $250,000 to $240,000).
o        The remaining  Protected Annual  Withdrawal  Amount for the balance of the first Annuity Year is also reduced by the amount
         withdrawn (from $17,500 to $7,500).

Example 2. Dollar-for-dollar and proportional reductions

A second  $10,000  withdrawal  is taken on December 13, 2003 (still within the first Annuity  Year).  The Account Value  immediately
before the withdrawal is $220,000.  As the amount  withdrawn  exceeds the remaining  Protected  Annual  Withdrawal  Amount of $7,500
from Example 1:
o        the Protected  Withdrawal  Value is first reduced by the remaining  Protected  Annual  Withdrawal  Amount (from $240,000 to
     $232,500);
o        The result is then further reduced by the ratio of A to B, where:
o        A is the amount withdrawn less the remaining Protected Annual Withdrawal Amount ($10,000 - $7,500, or $2,500).
o        B is the Account Value less the remaining Protected Annual Withdrawal Amount ($220,000 - $7,500, or $212,500).
     The resulting Protected Withdrawal Value is: $232,500 x ( 1 - $2,500 / $212,500), or $229,764.71.
o        the Protected Annual  Withdrawal  Amount is also reduced by the ratio of A to B: The resulting  Protected Annual Withdrawal
     Amount is: $17,500 x ( 1 - $2,500 / $212,500), or $17,294.12.
o        The remaining Protected Annual Withdrawal Amount is set to zero (0) for the balance of the first Annuity Year.

Example 3. Reset of the Maximum Annual Benefit

A $10,000  withdrawal is made on October 13, 2004 (second Annuity Year). The remaining  Protected Annual  Withdrawal Amount has been
reset to the Protected  Annual  Withdrawal  Amount of $17,294.12 from Example 2. As the amount  withdrawn is less than the remaining
Protected Annual Withdrawal Amount:
o        the  Protected  Withdrawal  Value is  reduced by the amount  withdrawn  (i.e.,  reduced by  $10,000,  from  $229,764.71  to
         $219,764.71).
o        The remaining  Protected Annual  Withdrawal Amount for the balance of the second Annuity Year is also reduced by the amount
         withdrawn (from $17,294.12 to $7,294.12).

BENEFITS UNDER THE GMWB PROGRAM

|X|      In addition to any  withdrawals  you make under the GMWB program,  market  performance  may reduce your Account  Value.  If
     your  Account  Value is  equal  to zero,  and you have  not  received  all of your  Protected  Withdrawal  Value in the form of
     withdrawals from your Annuity, we will continue to make payments equal to the remaining Protected  Withdrawal Value in the form
     of  fixed,  periodic  payments  until  the  remainder  of the  Protected  Withdrawal  Value is paid,  at which  time the  rider
     terminates.  The fixed,  periodic  payments will each be equal to the Protected Annual Withdrawal  Amount,  except for the last
     payment which may be equal to the remaining  Protected  Withdrawal  Value.  We will  determine the duration for which  periodic
     payments will continue by dividing the Protected  Withdrawal  Value by the Protected  Annual  Withdrawal  Amount.  You will not
     have the right to make additional  Purchase  Payments or receive the remaining  Protected  Withdrawal  Value in a lump sum. You
     can elect the frequency of payments, subject to our rules then in effect.

|X|      If the death benefit under the Annuity becomes payable before you have received all of your Protected  Withdrawal  Value in
     the form of  withdrawals  from your  Annuity,  your  Beneficiary  has the option to elect to receive  the  remaining  Protected
     Withdrawal  Value as an alternate  death benefit  payout in lieu of the amount  payable under any other death benefit  provided
     under the Annuity.  The remaining  Protected  Withdrawal Value will be payable in the form of fixed,  periodic  payments.  Your
     beneficiary  can elect the  frequency  of payments,  subject to our rules then in effect.  We will  determine  the duration for
     which periodic  payments will continue by dividing the Protected  Withdrawal Value by the Protected Annual  Withdrawal  Amount.
     The Protected  Withdrawal  Value is not equal to the Account Value for purposes of the Annuity's  other death benefit  options.
     The GMWB program does not increase or decrease the amount  otherwise  payable under the Annuity's other death benefit  options.
     Generally,  the GMWB program would be of value to your  Beneficiary  only when the Protected  Withdrawal Value at death exceeds
     any other amount available as a death benefit.

|X|      If you elect to begin receiving  annuity  payments before you have received all of your Protected  Withdrawal  Value in the
     form of  withdrawals  from your  Annuity,  an  additional  annuity  payment  option will be available  that makes fixed annuity
     payments for a certain  period,  determined  by dividing the Protected  Withdrawal  Value by the  Protected  Annual  Withdrawal
     Amount.  If you elect to receive annuity payments  calculated in this manner,  the assumed interest rate used to calculate such
     payments will be 0%, which is less than the assumed  interest rate on other annuity payment  options we offer.  This 0% assumed
     interest  rate results in lower annuity  payments  than what would have been paid if the assumed  interest rate was higher than
     0%. You can also elect to terminate the GMWB program and begin  receiving  annuity  payments based on your then current Account
     Value (not the remaining Protected Withdrawal Value) under any of the available annuity payment options.

Other Important Considerations
|X|      Withdrawals  under the GMWB program are subject to all of the terms and  conditions of the Annuity,  including any CDSC and
     MVA that may apply.  Amounts  withdrawn up to the  Protected  Annual  Withdrawal  Amount will  generally  not be subject to any
     applicable CDSC since they are less than the amount available under any free withdrawal provision of your Annuity.
|X|      Withdrawals  made while the GMWB  program is in effect  will be  treated,  for tax  purposes,  in the same way as any other
     withdrawals under the Annuity.
|X|      The GMWB program  does not  directly  affect the  Annuity's  Account  Value or Surrender  Value,  but any  withdrawal  will
     decrease  the Account  Value by the amount of the  withdrawal.  If you  surrender  your  Annuity,  you will receive the current
     Surrender Value, not the Protected Withdrawal Value.
|X|      You can make  withdrawals  from your Annuity  while your Account  Value is greater  than zero without  purchasing  the GMWB
     program.  The GMWB program  provides a guarantee  that if your Account Value  declines due to market  performance,  you will be
     able to receive your Protected Withdrawal Value in the form of periodic benefit payments.
|X|      We reserve the right to impose restrictions on the allocation of your Account Value,  including prohibiting  allocations to
     certain Portfolios.  We may also require that you allocate your Account Value according to an asset allocation model,  although
     it is not our current requirement.

Election of the Program
Currently,  the GMWB program can only be elected at the time that you purchase your Annuity.  In the future,  we may offer  existing
Annuity  Owners the option to elect the GMWB program after the Issue Date of their  Annuity,  subject to our  eligibility  rules and
restrictions.  If you elect the GMWB  program  after the Issue Date of your  Annuity,  the program  will be effective as of the next
anniversary  date. Your Account Value as of such anniversary date will be used to calculate the initial  Protected  Withdrawal Value
and the initial Protected Annual Withdrawal Amount.

We reserve the right to restrict the maximum amount of Protected  Withdrawal  Value that may be covered under the GMWB program under
this Annuity or any other annuities that you own that are issued by American Skandia or its affiliated companies.

Termination of the Program
The  program  terminates  automatically  when your  Protected  Withdrawal  Value  reaches  zero based on your  withdrawals.  You may
terminate  the program at any time by  notifying  us. If you  terminate  the  program,  any  guarantee  provided by the benefit will
terminate as of the date the termination is effective.  The program  terminates  upon your surrender of the Annuity,  upon due proof
of death (unless your  surviving  spouse elects to continue the Annuity and the GMWB program or your  Beneficiary  elects to receive
the amounts payable under the GMWB program in lieu of the death benefit) or upon your election to begin receiving annuity payments.

The charge for the GMWB program will no longer be deducted from your Account Value upon termination of the program.

Charges under the Program
Currently,  we  deduct a charge  equal to 0.35% of  Account  Value per year to  purchase  the GMWB  program.  The  annual  charge is
deducted daily against your Account Value  allocated to the  Sub-accounts.  Account Value allocated to Fixed  Allocations  under the
program is not subject to the charge.

|X|      If, during the seven Annuity Years  following the effective date of the program,  you do not make any  withdrawals,  and do
     not make any additional  Purchase  Payments after a five-year period  following the effective date of the program,  the program
     will remain in effect;  however,  we will waive the annual charge going  forward.  If you make an additional  Purchase  Payment
     following the waiver of the annual charge, we will begin charging for the program.

|X|      If you elect to step-up the  Protected  Withdrawal  Value  under the  program,  and on the date you elect to  step-up,  the
     charges  under the  program  have  changed for new  purchasers,  your  program  may be subject to the new charge  level for the
     benefit.

Additional Tax Considerations for Qualified Contracts
If you  purchase an Annuity as an  investment  vehicle for  "qualified"  investments,  including  an IRA,  SEP-IRA,  Roth IRA or Tax
Sheltered  Annuity (or 403(b)),  the minimum  distribution  rules under the Code require that you begin receiving  periodic  amounts
from your Annuity  beginning after age 70 1/2. The amount required under the Code may exceed the Protected  Annual  Withdrawal  Amount,
which will cause us to recalculate the Protected  Withdrawal Value and the Protected Annual Withdrawal Amount,  resulting in a lower
amount  payable in future  Annuity  Years.  In  addition,  the amount and duration of payments  under the annuity  payment and death
benefit  provisions may be adjusted so that the payments do not trigger any penalty or excise taxes due to tax  considerations  such
as minimum distribution requirements.

GUARANTEED MINIMUM INCOME BENEFIT (GMIB)

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The  Guaranteed  Minimum Income  Benefit  program  described  below is being offered in those  jurisdictions  where we have received
regulatory  approval,  and will be  offered  subsequently  in other  jurisdictions  when we  receive  regulatory  approval  in those
jurisdictions.  Certain terms and conditions  may differ between  jurisdictions  once approved.  Currently,  the program can only be
elected by new  purchasers on the Issue Date of their  Annuity.  We may offer the program to existing  Annuity Owners in the future,
subject to our  eligibility  rules and  restrictions.  The Guaranteed  Minimum Income Benefit  program is not available if you elect
the Guaranteed Return Option program, Guaranteed Return Option Plus program or the Guaranteed Minimum Withdrawal Benefit rider.
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We offer a program that, after a seven-year  waiting period,  guarantees your ability to begin receiving income from your Annuity in
the form of annuity  payments  based on a guaranteed  minimum value (called the "Protected  Income Value") that increases  after the
waiting period begins,  regardless of the impact of market  performance  on your Account Value.  The program may be appropriate  for
you if you  anticipate  using your Annuity as a future source of periodic  fixed income  payments for the remainder of your life and
wish to ensure that the basis upon which your income  payments will be calculated  will achieve at least a minimum  amount of growth
despite fluctuations in market performance.  There is an additional charge if you elect the GMIB program.

KEY FEATURE - Protected Income Value
The Protected  Income Value is the minimum amount that we guarantee will be available (net of any applicable  premium taxes),  after
a waiting  period of at least seven years,  to begin  receiving  fixed annuity  payments.  The  Protected  Income Value is initially
established on the effective  date of the GMIB program and is equal to your Account Value on such date.  The Protected  Income Value
is increased  daily based on an annual growth rate of 5%, subject to the limitations  described  below.  The Protected  Income Value
is referred to as the  "Protected  Value" in the rider we issue for this  benefit.  The 5% annual  growth rate is referred to as the
"Roll-Up Percentage" in the rider we issue for this benefit.

The  Protected  Income  Value is  subject  to a limit of 200%  (2X) of the sum of the  Protected  Income  Value  established  on the
effective  date of the GMIB  program  plus any  additional  Purchase  Payments  and any Credits  that are  applied to such  Purchase
Payments made after the waiting period begins ("Maximum  Protected Income Value"),  minus the sum of any reductions in the Protected
Income Value due to withdrawals you make from the Annuity after the waiting period begins.

|X|      Subject to the maximum  age/durational  limits described immediately below, we will no longer increase the Protected Income
     Value by the 5% annual growth rate once you reach the Maximum Protected Income Value.  However,  we will increase the Protected
     Income Value by the amount of any  additional  Purchase  Payments and any Credits  applied to such Purchase  Payments after you
     reach the Maximum  Protected  Income Value.  Further,  if you make  withdrawals  after you reach the Maximum  Protected  Income
     Value, we will reduce the Protected Income Value by the proportional impact of the withdrawal on your Account Value.

|X|      Subject to the Maximum  Protected  Income Value,  we will no longer  increase the  Protected  Income Value by the 5% annual
     growth rate after the later of the  anniversary  date on or  immediately  following  the  Annuitant's  80th birthday or the 7th
     anniversary of the later of the effective date of the GMIB program or the effective date of the most recent  step-up.  However,
     we will increase the Protected Income Value by the amount of any additional  Purchase  Payments and any Credits applied to such
     Purchase  Payments.  Further,  if you make withdrawals  after the Annuitant  reaches the maximum  age/duration  limits, we will
     reduce the Protected Income Value by the proportional impact of the withdrawal on your Account Value.

|X|      Subject to the Maximum Protected Income Value, if you make an additional  Purchase Payment,  we will increase the Protected
     Income Value by the amount of the Purchase  Payment  (including  any Credits that may be applied to your Account Value based on
     such  Purchase  Payment)  and will apply the 5% annual  growth  rate on the new amount  from the date the  Purchase  Payment is
     applied.

|X|      As described  below,  after the waiting period begins,  cumulative  withdrawals  each Annuity Year that are up to 5% of the
     Protected  Income Value will reduce the Protected  Income Value by the amount of the withdrawal.  Cumulative  withdrawals  each
     Annuity  Year in  excess  of 5% of the  Protected  Income  Value  will  reduce  the  Protected  Income  Value  proportionately.
     Withdrawals  after the Maximum  Protected Income Value is reached will reduce the Protected Income Value  proportionately.  The
     5% annual growth rate will be applied to the reduced Protected Income Value from the date of the withdrawal.

Stepping-Up  the Protected  Income Value - You may elect to "step-up" or "reset" your  Protected  Income Value if your Account Value
is greater than the current  Protected Income Value.  Upon exercise of the step-up  provision,  your initial  Protected Income Value
will be reset equal to your current  Account  Value.  From the date that you elect to step-up the Protected  Income  Value,  we will
apply the 5% annual growth rate to the stepped-up  Protected  Income Value,  as described  above.  You can only exercise the step-up
provision twice while the GMIB program is in effect, and only while the Annuitant is less than age 76.

|X|      A new  seven-year  waiting  period will be  established  upon the effective  date of your election to step-up the Protected
     Income Value.  You cannot exercise your right to begin receiving  annuity  payments under the GMIB program until the end of the
     new waiting period.
|X|      The Maximum  Protected  Income  Value will be reset as of the  effective  date of any  step-up.  The new Maximum  Protected
     Income Value will be equal to 200% of the sum of the Protected  Income Value as of the  effective  date of the step-up plus any
     subsequent  Purchase Payments and any Credits applied to such Purchase Payments,  minus the impact of any withdrawals after the
     date of the step-up.
|X|      When  determining the guaranteed  annuity  purchase rates for annuity  payments under the GMIB program,  we will apply such
     rates based on the number of years since the most recent step-up.
|X|      If you elect to step-up the  Protected  Income Value under the program,  and on the date you elect to step-up,  the charges
     under the GMIB program have changed for new purchasers, your program may be subject to the new charge going forward.

Impact of  Withdrawals on the Protected  Income Value - Cumulative  withdrawals  each Annuity Year up to 5% of the Protected  Income
Value will reduce the Protected  Income Value on a  "dollar-for-dollar"  basis (the Protected  Income Value is reduced by the actual
amount of the  withdrawal).  Cumulative  withdrawals  in any Annuity Year in excess of 5% of the Protected  Income Value will reduce
the  Protected  Income Value  proportionately  (see the examples of this  calculation  below).  The 5% annual  withdrawal  amount is
determined on each  anniversary  of the Issue Date (or on the Issue Date for the first Annuity Year) and applies to any  withdrawals
during the Annuity Year. This means that the amount  available for withdrawals each Annuity Year on a  "dollar-for-dollar"  basis is
adjusted to reflect changes in the Protected Income Value during the prior Annuity Year.

The following examples of  dollar-for-dollar  and proportional  reductions assume that: 1.) the Issue Date and the effective date of
the GMIB  program are October 13,  2003;  2.) an initial  Purchase  Payment of $250,000;  3.) an initial  Protected  Income Value of
$250,000; and 4.) a dollar-for-dollar limit of $12,500 (5% of $250,000):

Example 1. Dollar-for-dollar reduction

A  $10,000  withdrawal  is  taken on  November  13,  2003 (in the  first  Annuity  Year).  No prior  withdrawals  have  been  taken.
Immediately  prior to the withdrawal,  the Protected  Income Value is $251,038.10  (the initial value  accumulated for 31 days at an
annual effective rate of 5%).  As the amount withdrawn is less than the dollar-for-dollar limit:
o        the Protected Income Value is reduced by the amount withdrawn (i.e., by $10,000, from $251,038.10 to $241,038.10).
o        The  remaining  dollar-for-dollar  limit  ("Remaining  Limit") for the balance of the first Annuity Year is also reduced by
         the amount withdrawn (from $12,500 to $2,500).


Example 2. Dollar-for-dollar and proportional reductions

A second  $10,000  withdrawal  is taken on  December  13,  2003  (still  within  the first  Annuity  Year).  Immediately  before the
withdrawal,  the Account  Value is $220,000 and the  Protected  Income Value is  $242,006.64.  As the amount  withdrawn  exceeds the
Remaining Limit of $2,500 from Example 1:
o        the Protected Income Value is first reduced by the Remaining Limit (from 242,006.64 to 239,506.64);
o        The result is then further reduced by the ratio of A to B, where:
o        A is the amount withdrawn less the Remaining Limit ($10,000 - $2,500, or $7,500).
o        B is the Account Value less the Remaining Limit ($220,000 - $2,500, or $217,500).
     The resulting Protected Income Value is: $239,506.64 x ( 1 - $7,500 / $217,500), or $231,247.79.
o        The Remaining Limit is set to zero (0) for the balance of the first Annuity Year.

Example 3. Reset of the Dollar-for-dollar Limit

A $10,000  withdrawal is made on the first  anniversary  of the Issue Date,  October 13, 2004 (second  Annuity  Year).  Prior to the
withdrawal,  the Protected  Income Value is $240,870.56.  The Remaining Limit is reset to 5% of this amount,  or $12,043.53.  As the
amount withdrawn is less than the dollar-for-dollar limit:
o        the Protected Income Value is reduced by the amount withdrawn (i.e., reduced by $10,000, from $240,870.56 to $230,870.56).
o        The Remaining  Limit for the balance of the second Annuity Year is also reduced by the amount  withdrawn  (from  $12,043.53
         to $2,043.53).

KEY FEATURE - GMIB Annuity Payments
You can elect to apply the Protected  Income Value to one of the available  GMIB Annuity  Payment  Options on any  anniversary  date
following the initial  waiting  period,  or any subsequent  waiting period  established  upon your election to step-up the Protected
Income  Value.  Once you have  completed  the  waiting  period,  you will have a 30-day  period  each  year,  prior to the  contract
anniversary,  during which you may elect to begin  receiving  annuity  payments  under one of the  available  GMIB  Annuity  Payment
Options.  You must elect one of the GMIB Annuity  Payment  Options by the  anniversary of the Annuity's Issue Date on or immediately
following the  Annuitant's  95th birthday,  except for Annuities used as a funding  vehicle for an IRA, SEP IRA or 403(b),  in which
the case you must elect one of the GMIB Annuity  Payment  Options by the  anniversary of the Annuity's  Issue Date on or immediately
following the Annuitant's 92nd birthday.

The amount of each GMIB Annuity  Payment will be determined  based on the age and,  where  permitted by law, sex of the Annuitant by
applying the  Protected  Income Value (net of any  applicable  premium tax that may be due) to the GMIB Annuity  Payment  Option you
choose.  We use  special  annuity  purchase  rates to  calculate  the  amount of each  payment  due under the GMIB  Annuity  Payment
Options.  These  special  rates for the GMIB Annuity  Payment  Options are  calculated  using an assumed  interest  rate factor that
provides for lower growth in the value applied to produce  annuity  payments than if you elected an annuity  payment  option that is
not part of the GMIB program.  These special rates also are  calculated  using other factors such as "age  setbacks"  (use of an age
lower than the  Annuitant's  actual age) that result in lower  payments than would result if you elected an annuity  payment  option
that is not part of the GMIB program.  Use of an age setback  entails a longer assumed life for the Annuitant  which in turn results
in lower annuity payments.

On the date that you elect to begin  receiving GMIB Annuity  Payments,  we guarantee that your payments will be calculated  based on
your Account Value and our then current annuity  purchase rates if the payment amount  calculated on this basis would be higher than
it would be based on the Protected Income Value and the special GMIB annuity purchase rates.

GMIB Annuity Payment Option 1 - Payments for Life with a Certain Period
Under this option,  monthly  annuity  payments will be made until the death of the  Annuitant.  If the Annuitant  dies before having
received 120 monthly annuity payments, the remainder of the 120 monthly annuity payments will be made to the Beneficiary.

GMIB Annuity Payment Option 2 - Payments for Joint Lives with a Certain Period
Under this option,  monthly  annuity  payments will be made until the death of both the Annuitant  and the Joint  Annuitant.  If the
Annuitant  and the Joint  Annuitant  die before  having  received 120 monthly  annuity  payments,  the  remainder of the 120 monthly
annuity payments will be made to the Beneficiary.
|X|      If the Annuitant  dies first,  we will continue to make  payments  until the later of the death of the Joint  Annuitant and
     the end of the period certain.  However,  if the Joint Annuitant is still receiving  annuity payments  following the end of the
     certain period, we will reduce the amount of each subsequent payment to 50% of the original payment amount.
|X|      If the Joint  Annuitant  dies first,  we will continue to make  payments  until the later of the death of the Annuitant and
     the end of the period certain.

You cannot  withdraw  your  Account  Value or the  Protected  Income Value under  either GMIB  Annuity  Payment  Option once annuity
payments have begun.  We may make other payout frequencies available, such as quarterly, semi-annually or annually.

Other Important Considerations
|X|      The GMIB program does not directly affect the Annuity's  Account Value,  Surrender Value or the amount payable under either
     the basic death benefit provision of the Annuity or any optional death benefit  provision.  If you surrender your Annuity,  you
     will receive the current  Surrender  Value,  not the Protected  Income Value.  The Protected Income Value is only applicable if
     you elect to begin receiving annuity payments under one of the GMIB annuity options after the waiting period.
|X|      The Annuity offers other annuity  payment  options that you can elect which do not impose an additional  charge,  but which
     do not offer to guarantee a minimum value on which to make annuity payments.
|X|      Where allowed by law, we reserve the right to limit subsequent  purchase payments if we determine,  at our sole discretion,
     that based on the timing of your Purchase  Payments and  withdrawals,  your Protected Income Value is increasing in ways we did
     not intend. In determining whether to limit Purchase Payments,  we will look at Purchase Payments which are  disproportionately
     larger than your initial Purchase Payment and other actions that may artificially increase the Protected Income Value.
|X|      We reserve the right to impose restrictions on the allocation of your Account Value,  including prohibiting  allocations to
     certain Portfolios.  We may also require that you allocate your Account Value according to an asset allocation model.
|X|      If you change the  Annuitant  after the effective  date of the GMIB program,  the period of time during which we will apply
     the 5% annual growth rate may be changed based on the age of the new Annuitant.  If the new Annuitant  would not be eligible to
     elect the GMIB program based on his or her age at the time of the change, then the GMIB program will terminate.
|X|      Annuity payments made under the GMIB program are subject to the same tax treatment as any other annuity payment.
|X|      At the time you elect to begin  receiving  annuity  payments  under the GMIB  program  or under any other  annuity  payment
     option we make available,  the protection provided by the Annuity's basic death benefit or any optional death benefit provision
     you elected will no longer apply.

Election of the Program
Currently,  the GMIB program can only be elected at the time that you purchase  your Annuity.  The Annuitant  must be age 75 or less
as of the effective  date of the GMIB program.  In the future,  we may offer  existing  Annuity  Owners the option to elect the GMIB
program after the Issue Date of their Annuity,  subject to our  eligibility  rules and  restrictions.  If you elect the GMIB program
after the Issue Date of your Annuity,  the program will be effective as of the next  anniversary  date. Your Account Value as of the
anniversary date will be used to calculate the Protected Income Value as of the effective date of the program.

Termination of the Program
The GMIB program  cannot be  terminated  by the Owner once  elected.  The GMIB program  automatically  terminates as of the date the
Annuity is fully surrendered,  on the date the death benefit is payable to your Beneficiary  (unless your surviving spouse elects to
continue the Annuity),  or on the date that your Account Value is  transferred to begin making  annuity  payments.  The GMIB program
may also be  terminated  if you  designate a new  Annuitant  who would not be eligible to elect the GMIB program based on his or her
age at the time of the change.

Upon  termination  of the GMIB program we will deduct the charge from your  Account  Value for the portion of the Annuity Year since
the prior anniversary of the Annuity's Issue Date (or the Issue Date if in the first Annuity Year).

Charges under the Program
Currently,  we deduct a charge  equal to 0.50% per year of the average  Protected  Income  Value for the period the charge  applies.
Because the charge is calculated  based on the average  Protected Income Value, it does not increase or decrease based on changes to
the Annuity's Account Value due to market  performance.  If the average  Protected Income Value increases,  the dollar amount of the
annual charge will increase, while a decrease in the Protected Income Value will decrease the dollar amount of the charge.

The charge is deducted  annually in arrears  each Annuity Year on the  anniversary  of the Issue Date of the Annuity.  We deduct the
amount of the charge  pro-rata from the Account Value allocated to the variable  investment  options and the Fixed  Allocations.  No
MVA will apply to Account Value deducted from a Fixed  Allocation.  If you surrender your Annuity,  begin receiving annuity payments
under the GMIB  program  or any other  annuity  payment  option  we make  available  during an  Annuity  Year,  or the GMIB  program
terminates,  we will deduct the charge for the portion of the Annuity Year since the prior  anniversary of the Annuity's  Issue Date
(or the Issue Date if in the first Annuity Year).

No charge applies after the Annuity Date.

DEATH BENEFIT

WHAT TRIGGERS THE PAYMENT OF A DEATH BENEFIT?
The Annuity provides a Death Benefit during its  accumulation  period.  If the Annuity is owned by one or more natural persons,  the
Death  Benefit is payable  upon the first  death of an Owner.  If the  Annuity is owned by an entity,  the Death  Benefit is payable
upon the Annuitant's  death, if there is no Contingent  Annuitant.  If a Contingent  Annuitant was designated before the Annuitant's
death and the  Annuitant  dies,  then the  Contingent  Annuitant  becomes the Annuitant and a Death Benefit will not be paid at that
time.  The person upon whose death the Death Benefit is paid is referred to below as the "decedent."

Basic Death Benefit
The Annuity  provides a basic Death Benefit at no additional  charge.  The Insurance  Charge we deduct daily from your Account Value
allocated to the  Sub-accounts  is used, in part,  to pay us for the risk we assume in providing  the basic Death Benefit  guarantee
under the  Annuity.  The Annuity  also offers two  different  optional  Death  Benefits.  Either  benefit  can be  purchased  for an
additional charge. The additional charge is deducted to compensate  American Skandia for providing  increased  insurance  protection
under the optional Death  Benefits.  Notwithstanding  the additional  protection  provided  under the optional Death  Benefits,  the
additional cost has the impact of reducing the net performance of the investment options.

The basic Death Benefit is the greater of:
|X|      The sum of all Purchase Payments less the sum of all proportional withdrawals.
|X|      The sum of your Account Value in the variable investment options and your Interim Value in the Fixed Allocations.

"Proportional  withdrawals"  are  determined  by  calculating  the  percentage  of your  Account  Value that each  prior  withdrawal
represented  when  withdrawn.  For example,  a withdrawal of 50% of Account Value would be considered as a 50% reduction in Purchase
Payments for purposes of calculating the basic Death Benefit.

OPTIONAL DEATH BENEFITS

Two  optional  Death  Benefits  are offered for  purchase  with your  Annuity to provide an enhanced  level of  protection  for your
beneficiaries.

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Currently,  these  benefits  are only  offered and must be elected at the time that you purchase  your  Annuity.  We may, at a later
date,  allow  existing  Annuity Owners to purchase  either of the optional  Death  Benefits  subject to our rules and any changes or
restrictions  in the  benefits.  Certain  terms and  conditions  may differ if you  purchase  your  Annuity as part of an  exchange,
replacement or transfer, in whole or in part, from any other Annuity we issue.
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Enhanced Beneficiary Protection Optional Death Benefit
The Enhanced  Beneficiary  Protection  Optional Death Benefit can provide additional amounts to your Beneficiary that may be used to
offset  federal and state taxes  payable on any taxable  gains in your  Annuity at the time of your death.  Whether  this benefit is
appropriate for you may depend on your particular  circumstances,  including other financial resources that may be available to your
Beneficiary to pay taxes on your Annuity  should you die during the  accumulation  period.  No benefit is payable if death occurs on
or after the Annuity Date.

The  Enhanced  Beneficiary  Protection  Optional  Death  Benefit  provides a benefit  that is payable in addition to the basic Death
Benefit.  If the Annuity has one Owner,  the Owner must be age 75 or less at the time the benefit is  purchased.  If the Annuity has
joint Owners, the oldest Owner must be age 75 or less.  If the Annuity is owned by an entity, the Annuitant must be age 75 or less.

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The  Enhanced  Beneficiary  Protection  Optional  Death  Benefit is being  offered  in those  jurisdictions  where we have  received
regulatory  approval.  Certain terms and  conditions  may differ between  jurisdictions  once approved.  Please refer to the section
entitled "Tax Considerations" for a discussion of special tax considerations for purchasers of this benefit.
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Calculation of Enhanced Beneficiary Protection Optional Death Benefit
If you purchase the Enhanced Beneficiary Protection Optional Death Benefit, the Death Benefit is calculated as follows:

1.       the basic Death Benefit described above;

     PLUS

2.       40% of your "Growth" under the Annuity, as defined below.

"Growth"  means the sum of your Account Value in the variable  investment  options and your Interim Value in the Fixed  Allocations,
minus the total of all Purchase Payments reduced by the sum of all proportional withdrawals.

"Proportional  withdrawals"  are  determined  by  calculating  the  percentage  of your  Account  Value that each  prior  withdrawal
represented when withdrawn.

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The Enhanced  Beneficiary  Protection Optional Death Benefit is subject to a maximum of 100% of all Purchase Payments applied to the
Annuity at least 12 months prior to the death of the decedent that triggers the payment of the Death Benefit.
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See Appendix C for examples of how the Enhanced Beneficiary Protection Optional Death Benefit is calculated.

Highest Anniversary Value Death Benefit
If the Annuity has one Owner, the Owner must be age 79 or less at the time the Highest  Anniversary  Value Optional Death Benefit is
purchased.  If the Annuity has joint  Owners,  the oldest  Owner must be age 79 or less.  If the Annuity is owned by an entity,  the
Annuitant must be age 79 or less.

Certain of the Portfolios  offered as Sub-accounts  under the Annuity are not available if you elect the Highest  Anniversary  Value
Death Benefit.

Key Terms Used with the Highest Anniversary Value Death Benefit

|X|      The Death Benefit Target Date is the contract  anniversary  on or after the 80th birthday of the current Owner,  the oldest
     of either joint Owner or the Annuitant, if entity owned.

|X|      The Highest Anniversary Value equals the highest of all previous  "Anniversary  Value" less proportional  withdrawals since
     such anniversary and plus any Purchase Payments since such anniversary.

|X|      The  Anniversary  Value is the Account  Value as of each  anniversary  of the Issue Date of the  Annuity.  The  Anniversary
     Value on the Issue Date is equal to your Purchase Payment.

|X|      Proportional  withdrawals  result in a  reduction  to the  Highest  Anniversary  Value by  reducing  such value in the same
     proportion as the Account Value was reduced by the  withdrawal as of the date the  withdrawal  occurred.  For example,  if your
     Highest  Anniversary  Value is $125,000 and you  subsequently  withdraw  $10,000 at a time when your Account  Value is equal to
     $100,000 (a 10%  reduction),  when  calculating  the  optional  Death  Benefit we will reduce your  Highest  Anniversary  Value
     ($125,000) by 10% or $12,500.

Calculation of Highest Anniversary Value Death Benefit
The Highest Anniversary Value Death Benefit depends on whether death occurs before or after the Death Benefit Target Date.

         If the Owner dies before the Death Benefit Target Date, the Death Benefit equals the greater of:

1.       the basic Death Benefit described above; and
2.       the Highest Anniversary Value as of the Owner's date of death.

         If the Owner dies on or after the Death Benefit Target Date, the Death Benefit equals the greater of:

1.       the basic Death Benefit described above; and
2.       the Highest  Anniversary  Value on the Death Benefit Target Date plus the sum of all Purchase  Payments less the sum of all
              proportional withdrawals since the Death Benefit Target Date.

         The amount  determined by this calculation is increased by any Purchase  Payments  received after the Owner's date of death
         and decreased by any proportional withdrawals since such date.

See Appendix C for examples of how the Highest Anniversary Value Death Benefit is calculated.


Annuities with joint Owners
For  Annuities  with Joint  Owners,  the Death  Benefit is  calculated as shown above except that the age of the oldest of the Joint
Owners is used to determine the Death Benefit  Target Date.  NOTE: If you and your spouse own the Annuity  jointly,  we will pay the
Death Benefit to the Beneficiary.  If the sole primary  Beneficiary is the surviving spouse,  then the surviving spouse can elect to
assume ownership of the Annuity and continue the contract instead of receiving the Death Benefit.

Annuities owned by entities
For  Annuities  owned by an entity,  the Death  Benefit is calculated as shown above except that the age of the Annuitant is used to
determine  the Death  Benefit  Target  Date.  Payment of the Death  Benefit is based on the death of the  Annuitant  (or  Contingent
Annuitant, if applicable).

Can I terminate the optional Death Benefits?  Do the optional Death Benefits terminate under other circumstances?
You can terminate the Enhanced  Beneficiary  Protection  Optional Death Benefit and the Highest  Anniversary  Value Death Benefit at
any time.  Both  optional  Death  Benefits will  terminate  automatically  on the Annuity  Date. We may also  terminate any optional
Death Benefit if necessary to comply with our interpretation of the Code and applicable regulations.

What are the charges for the optional Death Benefits?
We deduct a charge equal to 0.25% per year,  respectively,  if you elect the Highest Anniversary Value Optional Death Benefit or the
Enhanced  Beneficiary  Protection  Optional Death Benefit.  If you elect both optional Death Benefits,  the total charge is equal to
0.50% per year.  We deduct the charge to  compensate  American  Skandia  for  providing  increased  insurance  protection  under the
optional Death Benefit.  The additional annual charge is deducted daily against your Account Value allocated to the Sub-accounts.

Please refer to the section entitled "Tax Considerations" for additional considerations in relation to the optional Death Benefit.

AMERICAN SKANDIA'S ANNUITY REWARDS

What is the Annuity Rewards benefit?
The Annuity  Rewards  benefit  offers  Owners the ability to capture  any market  gains since the Issue Date of their  Annuity as an
enhancement  to their  current Death Benefit so their  Beneficiaries  will not receive less than the Annuity's  value as of the date
the Owner elects the benefit.  Under the Annuity Rewards  benefit,  American  Skandia  guarantees that the Death Benefit will not be
less than:

         your Account Value in the variable  investment  options plus the Interim Value in any Fixed Allocations as of the effective
                  date of the Owner's election

         MINUS any proportional withdrawals* following the date of election

         PLUS any additional Purchase Payments applied to the Annuity following the date of election.

*    "Proportional  withdrawals" are determined by calculating the percentage of the Account Value that each withdrawal  represented
     when  withdrawn.  For example,  a withdrawal  of 50% of your  Account  Value would be treated as a 50%  reduction in the amount
     payable under the Death Benefit.

The Annuity  Rewards Death Benefit  enhancement  does not affect the  calculation  of the basic Death Benefit or any Optional  Death
Benefits  available  under the Annuity to the extent such benefit  provides for a change in the method of  calculation  based on the
age of the decedent as of the date of death.  If the Death Benefit amount  payable under your  Annuity's  basic Death Benefit or any
Optional Death Benefits you purchase is greater than the enhanced  Death Benefit under the Annuity  Rewards  benefit on the date the
Death Benefit is calculated, your Beneficiary will receive the higher amount.

Who is eligible for the Annuity Rewards benefit?
Owners can elect the Annuity  Rewards  Death  Benefit  enhancement  following the eighth (8th)  anniversary  of the Annuity's  Issue
Date.  However,  the  election is subject to the  requirement  that their  Account  Value on the  election  date is greater than the
amount  that would be payable to their  Beneficiary  under the Death  Benefit  provided  under the Annuity as of the  election  date
(including  any amounts  payable  under the Highest  Anniversary  Value Death  Benefit).  If an Owner is  ineligible  when he or she
applies for the optional benefit,  the Owner can elect the Annuity Rewards Death Benefit  enhancement on any subsequent date if they
otherwise  qualify.  The election  must occur before  annuity  payments  begin.  An Owner can only elect the Annuity  Rewards  Death
Benefit enhancement once.  There is no additional charge for electing the Annuity Rewards Death Benefit enhancement.


PAYMENT OF DEATH BENEFITS

Payment of Death Benefit to Beneficiary
Except in the case of a spousal Beneficiary, in the event of your death, the death benefit must be distributed:
|X|      as a lump sum amount at any time within five (5) years of the date of death; or
|X|      as a series of annuity  payments  not  extending  beyond the life  expectancy  of the  Beneficiary  or over the life of the
         Beneficiary.  Payments under this option must begin within one year of the date of death.

Unless you have made an  election  prior to death  benefit  proceeds  becoming  due, a  Beneficiary  can elect to receive  the Death
Benefit  proceeds as a series of fixed annuity  payments  (annuity  payment options 1-4) or as a series of variable annuity payments
(annuity payment options 1-3 or 5 and 6).  See the section entitled "What Types of Annuity Options are Available."

Spousal Beneficiary - Assumption of Annuity
You may name your  spouse as your  Beneficiary.  If you and your  spouse own the Annuity  jointly,  we assume that the sole  primary
Beneficiary will be the surviving spouse unless you elect an alternative  Beneficiary  designation.  Unless you elect an alternative
Beneficiary  designation,  the spouse  Beneficiary may elect to assume  ownership of the Annuity instead of taking the Death Benefit
payment.  Any Death Benefit  (including any optional Death  Benefits)  that would have been payable to the  Beneficiary  will become
the new  Account  Value as of the date we receive due proof of death and any  required  proof of a spousal  relationship.  As of the
date the  assumption is  effective,  the  surviving  spouse will have all the rights and benefits that would be available  under the
Annuity to a new  purchaser of the same  attained  age.  For purposes of  determining  any future  Death  Benefit for the  surviving
spouse,  the new Account Value will be  considered as the initial  Purchase  Payment.  No CDSC will apply to the new Account  Value.
However,  any additional  Purchase  Payments applied after the date the assumption is effective will be subject to all provisions of
the Annuity, including any CDSC that may apply to the additional Purchase Payments.

See the section  entitled  "Managing  Your Annuity - Spousal  Contingent  Annuitant"  for a discussion of the treatment of a spousal
Contingent Annuitant in the case of the death of the Annuitant in an entity owned Annuity.

IRA Beneficiary Continuation Option
The Code  provides for  alternative  death benefit  payment  options when an Annuity is used as an IRA,  403(b) or other  "qualified
investment" that requires Minimum  Distributions.  Upon the Owner's death under an IRA, 403(b) or other  "qualified  investment",  a
Beneficiary  may generally elect to continue the Annuity and receive  Minimum  Distributions  under the Annuity instead of receiving
the death benefit in a single  payment.  The available  payment  options will depend on whether the Owner died on or before the date
he or she was required to begin receiving Minimum Distributions under the Code and whether the Beneficiary is the surviving spouse.

|X|      If death  occurs  before the date Minimum  Distributions  must begin under the Code,  the Death  Benefit can be paid out in
         either a lump  sum,  within  five  years  from the date of death,  or over the life or life  expectancy  of the  designated
         Beneficiary  (as long as payments begin by December 31st of the year following the year of death).  However,  if the spouse
         is the  Beneficiary,  the Death  Benefit can be paid out over the life or life  expectancy of the spouse with such payments
         beginning no earlier than December  31st of the year  following the year of death or December 31st of the year in which the
         deceased would have reached age 70 1/2, which ever is later.

|X|      If death occurs  after the date  Minimum  Distributions  must begin under the Code,  the Death  Benefit must be paid out at
         least as rapidly as under the method then in effect.

A Beneficiary has the flexibility to take out more each year than required under the Minimum  Distribution  rules.  Until withdrawn,
amounts in an IRA,  403(b) or other  "qualified  investment"  continue to be tax deferred.  Amounts  withdrawn each year,  including
amounts  that are  required to be  withdrawn  under the Minimum  Distribution  rules,  are subject to tax. You may wish to consult a
professional  tax advisor for tax advice as to your  particular  situation.  See the section  entitled "How are  Distributions  From
Qualified Contracts Taxed? - Minimum Distributions after age 70 1/2."

Upon election of this IRA Beneficiary Continuation option:

|X|      the Annuity contract will be continued in the Owner's name, for the benefit of the Beneficiary.
|X|      the Account Value will be equal to any Death Benefit  (including  any optional  Death Benefit) that would have been payable
              to the Beneficiary if they had taken a lump sum distribution.
|X|      the Beneficiary may request  transfers among  Sub-accounts,  subject to the same limitations and restrictions  that applied
              to the Owner.  NOTE: The Sub-accounts offered under the IRA Beneficiary Continuation option may be limited.
|X|      no additional Purchase Payments can be applied to the Annuity.
|X|      the basic Death Benefit and any optional Death Benefits elected by the Owner will no longer apply to the Beneficiary.
|X|      the  Beneficiary  can request a withdrawal  of all or a portion of the Account Value at any time without  application  of a
              CDSC.
|X|      upon the death of the  Beneficiary,  any remaining  Account Value will be paid in a lump sum to the person(s)  named by the
              Beneficiary.
|X|      all amounts in the Annuity  must be paid out to the  Beneficiary  according  to the Minimum  Distribution  rules  described
              above.

Please contact American Skandia for additional  information on the  availability,  restrictions and limitations that will apply to a
Beneficiary under the IRA Beneficiary Continuation option.

Are there any exceptions to these rules for paying the Death Benefit?
Yes,  there are exceptions  that apply no matter how your Death Benefit is calculated.  There are exceptions to the Death Benefit if
the  decedent  was not the Owner or  Annuitant  as of the Issue  Date and did not  become  the Owner or  Annuitant  due to the prior
Owner's or  Annuitant's  death.  Any Death Benefit  (including  either  optional Death Benefit) that applies will be suspended for a
two-year  period from the date he or she first became Owner or Annuitant.  After the two-year  suspension  period is completed,  the
Death Benefit is the same as if this person had been an Owner or Annuitant on the Issue Date.

When do you determine the Death Benefit?
We  determine  the amount of the Death  Benefit as of the date we receive  "due  proof of  death",  any  instructions  we require to
determine  the method of payment and any other  written  representations  we require to  determine  the proper  payment of the Death
Benefit to all  Beneficiaries.  "Due proof of death" may  include a certified  copy of a death  certificate,  a certified  copy of a
decree of a court of competent  jurisdiction as to the finding of death or other  satisfactory  proof of death.  Upon our receipt of
"due proof of death" we  automatically  transfer the Death Benefit to the AST Money Market  Sub-account  until we further  determine
the universe of eligible  Beneficiaries.  Once the universe of eligible  Beneficiaries has been determined each eligible Beneficiary
may allocate his or her eligible share of the Death Benefit to the Sub-accounts according to our rules.

Each  Beneficiary  must make an  election  as to the method  they wish to receive  their  portion  of the Death  Benefit.  Absent an
election  of a  Death  Benefit  payment  method,  no  Death  Benefit  can  be  paid  to the  Beneficiary.  We  may  require  written
acknowledgment  of all named  Beneficiaries  before we can pay the Death Benefit.  During the period from the date of death until we
receive all required paper work, the amount of the Death Benefit may be subject to market fluctuations.

VALUING YOUR INVESTMENT

HOW IS MY ACCOUNT VALUE DETERMINED?
During the accumulation  period,  the Annuity has an Account Value. The Account Value is determined  separately for each Sub-account
allocation and for each Fixed  Allocation.  The Account Value is the sum of the values of each Sub-account  allocation and the value
of each  Fixed  Allocation.  The  Account  Value  does not  reflect  any CDSC  that may apply to a  withdrawal  or  surrender.  When
determining  the  Account  Value on a day more than 30 days prior to a Fixed  Allocation's  Maturity  Date,  the  Account  Value may
include any Market Value Adjustment that would apply to a Fixed Allocation (if withdrawn or transferred) on that day.

WHAT IS THE SURRENDER VALUE OF MY ANNUITY?
The Surrender Value of your Annuity is the value  available to you on any day during the  accumulation  period.  The Surrender Value
is equal to your Account Value minus any CDSC, the Annual  Maintenance Fee and the charge for any optional  benefits.  The Surrender
Value will also include any Market Value Adjustment that may apply.

HOW AND WHEN DO YOU VALUE THE SUB-ACCOUNTS?
When you  allocate  Account  Value  to a  Sub-account,  you are  purchasing  units  of the  Sub-account.  Each  Sub-account  invests
exclusively  in  shares  of an  underlying  Portfolio.  The  value of the  Units  fluctuates  with the  market  fluctuations  of the
Portfolios.  The value of the Units  also  reflects  the daily  accrual  for the  Insurance  Charge,  the  Distribution  Charge  (if
applicable),  and if you elected one or more optional  benefits whose annual charge is deducted  daily,  the additional  charge made
for such benefits.  There may be several  different Unit Prices for each Sub-account to reflect the Insurance  Charge,  Distribution
Charge and the charges for any  optional  benefits.  The Unit Price for the Units you  purchase  will be based on the total  charges
for the benefits  that apply to your  Annuity.  See the section  entitled  "What Happens to My Units When There is a Change in Daily
Asset-Based  Charges?" for a detailed  discussion  of how Units are  purchased and redeemed to reflect  changes in the daily charges
that apply to your Annuity.

Each  Valuation  Day, we determine  the price for a Unit of each  Sub-account,  called the "Unit  Price." The Unit Price is used for
determining  the value of  transactions  involving  Units of the  Sub-accounts.  We  determine  the number of Units  involved in any
transaction by dividing the dollar value of the transaction by the Unit Price of the Sub-account as of the Valuation Day.


Example
Assume you allocate  $5,000 to a Sub-account.  On the Valuation Day you make the allocation,  the Unit Price is $14.83.  Your $5,000
buys  337.154  Units of the  Sub-account.  Assume  that  later,  you wish to  transfer  $3,000  of your  Account  Value  out of that
Sub-account  and  into  another  Sub-account.  On the  Valuation  Day you  request  the  transfer,  the Unit  Price of the  original
Sub-account  has  increased to $16.79.  To transfer  $3,000,  we sell 178.677  Units at the current Unit Price,  leaving you 158.477
Units.  We then buy $3,000 of Units of the new  Sub-account  at the Unit Price of $17.83.  You would then have 168.255  Units of the
new Sub-account.

HOW DO YOU VALUE FIXED ALLOCATIONS?
During the Guarantee  Period,  we use the concept of an Interim  Value.  The Interim Value can be calculated on any day and is equal
to the initial value allocated to a Fixed  Allocation plus all interest  credited to a Fixed  Allocation as of the date  calculated.
The Interim  Value does not include the impact of any Market  Value  Adjustment.  If you made any  transfers or  withdrawals  from a
Fixed  Allocation,  the Interim Value will reflect the withdrawal of those amounts and any interest credited to those amounts before
they were  withdrawn.  To determine  the Account  Value of a Fixed  Allocation  on any day other than its Maturity Date or within 30
days prior to its Maturity Date, we multiply the Account Value of the Fixed Allocation times the Market Value Adjustment factor.

WHEN DO YOU PROCESS AND VALUE TRANSACTIONS?
American Skandia is generally open to process  financial  transactions on those days that the New York Stock Exchange (NYSE) is open
for  trading.  There  may be  circumstances  where  the NYSE  does not open on a  regularly  scheduled  date or time or closes at an
earlier time than scheduled  (normally  4:00 p.m. EST).  Financial  transactions  requested  before the close of the NYSE which meet
our requirements will be processed according to the value next determined  following the close of business.  Financial  transactions
requested  on a  non-business  day or after the close of the NYSE will be  processed  based on the value next  computed  on the next
business  day.  There may be  circumstances  when the  opening or closing  time of the NYSE is  different  than  other  major  stock
exchanges,  such as NASDAQ or the  American  Stock  Exchange.  Under such  circumstances,  the closing time of the NYSE will be used
when valuing and processing transactions.

There may be circumstances  where the NYSE is open,  however,  due to inclement  weather,  natural  disaster or other  circumstances
beyond  our  control,  our  offices  may  be  closed  or  our  business  processing  capabilities  may be  restricted.  Under  those
circumstances,  your Account Value may fluctuate  based on changes in the Unit Values,  but you may not be able to transfer  Account
Value, or make a purchase or redemption request.

The NYSE is closed on the following nationally  recognized  holidays:  New Year's Day, Martin Luther King, Jr. Day, Presidents' Day,
Good Friday,  Memorial Day,  Independence  Day,  Labor Day,  Thanksgiving,  and Christmas.  On those dates,  we will not process any
financial transactions involving purchase or redemption orders.

American Skandia will also not process financial transactions involving purchase or redemption orders or transfers on any day that:
|X|      trading on the NYSE is restricted;
|X|      an emergency exists making redemption or valuation of securities held in the separate account impractical; or
|X|      the SEC, by order, permits the suspension or postponement for the protection of security holders.

Initial  Purchase  Payments:  We are required to allocate  your initial  Purchase  Payment to the  Sub-accounts  within two (2) days
after we receive  all of our  requirements  to issue the  Annuity.  If we do not have all the  required  information  to allow us to
issue your  Annuity,  we may retain  the  Purchase  Payment  while we try to reach you or your  representative  to obtain all of our
requirements.  If we are unable to obtain all of our  required  information  within  five (5) days,  we are  required  to return the
Purchase  Payment to you at that time,  unless you  specifically  consent to our retaining the Purchase  Payment while we gather the
required  information.  Once we obtain the required  information,  we will invest the Purchase  Payment and issue the Annuity within
two (2) days.  During any period that we are trying to obtain the required information, your money is not invested.

Additional  Purchase  Payments:  We will apply any  additional  Purchase  Payments on the Valuation Day that we receive the Purchase
Payment with satisfactory allocation instructions.

Scheduled  Transactions:  "Scheduled"  transactions  include  transfers  under  a  Dollar  Cost  Averaging,  rebalancing,  or  asset
allocation program,  Systematic  Withdrawals,  Minimum Distributions or annuity payments.  Scheduled  transactions are processed and
valued as of the date they are scheduled,  unless the scheduled day is not a Valuation Day. In that case,  the  transaction  will be
processed and valued on Valuation Day prior to the scheduled transaction date.

Unscheduled  Transactions:   "Unscheduled"  transactions  include  any  other  non-scheduled  transfers  and  requests  for  Partial
Withdrawals  or Free  Withdrawals  or  Surrenders.  Unscheduled  transactions  are  processed  and valued as of the Valuation Day we
receive the request at our Office and have all of the required information.

Medically-related  Surrenders & Death  Benefits:  Medically-related  surrender  requests and Death Benefit claims require our review
and evaluation before  processing.  We price such transactions as of the date we receive at our Office all supporting  documentation
we require for such transactions and that are satisfactory to us.

Transactions in ProFunds VP Sub-accounts:  Generally,  purchase or redemption  orders or transfer requests must be received by us by
no later than the close of the NYSE to be processed on the current  Valuation  Day.  However,  any purchase or  redemption  order or
transfer  request  involving  the  ProFunds VP  Sub-accounts  must be  received by us no later than one hour prior to any  announced
closing of the applicable  securities  exchange  (generally,  3:00 p.m. Eastern time) to be processed on the current  Valuation Day.
The "cut-off"  time for such  financial  transactions  involving a ProFunds VP  Sub-account  will be extended to1/2hour prior to any
announced  closing  (generally,  3:30 p.m.  Eastern time) for  transactions  submitted  electronically  through  American  Skandia's
Internet  website  (www.americanskandia.prudential.com).  You cannot  request a transaction  involving  the purchase,  redemption or
transfer  of units in one of the  ProFunds  VP  Sub-accounts  between  the  applicable  "cut-off"  time and 4:00  p.m.  Transactions
received after 4:00 p.m. will be treated as received by us on the next Valuation Day.

WHAT HAPPENS TO MY UNITS WHEN THERE IS A CHANGE IN DAILY ASSET-BASED CHARGES?

Distribution  Charge:  The  Distribution  Charge is deducted  under your  Annuity  during  Annuity  Years 1-8. At the end of the 8th
Annuity  Year,  we will no longer  deduct the  Distribution  Charge.  On the date the charge no longer  applies,  your  Annuity will
become subject to a different  daily  asset-based  charge.  We will process a transaction  where your Account Value allocated to the
Sub-accounts  will be used to purchase  new Units of the  Sub-accounts  that  reflect the  Insurance  Charge (and the charge for any
optional  benefits  you have  elected)  but not the  Distribution  Charge.  The number of Units  attributed  to your Annuity will be
decreased  and the Unit Price of each unit of the  Sub-accounts  in which you invested  will be  increased.  The  adjustment  in the
number of Units and Unit Price will not affect your Account  Value.  Beginning on that date,  your Account  Value will be determined
based on the change in the value of Units that reflect the Insurance Charge and any other optional benefits that you have elected.

Termination  of Optional  Benefits:  Except for the  Guaranteed  Minimum Income Benefit which cannot be terminated by the owner once
elected,  if you  terminate  any other  optional  benefit,  we will no longer  deduct the charge we apply to purchase  the  optional
benefit.  On the date the charge no longer applies,  your Annuity will become subject to a different daily  asset-based  charge.  We
will  process a  transaction  where your  Account  Value  allocated  to the  Sub-accounts  will be used to purchase new Units of the
Sub-accounts  that reflect the Insurance Charge,  the Distribution  Charge (if applicable) and any optional benefit or program still
elected,  but not the charge  for the  optional  benefit or program  that you  terminated.  The number of Units  attributed  to your
Annuity  will be  decreased  and the Unit  Price of each unit of the  Sub-accounts  in which you  invested  will be  increased.  The
adjustment  in the number of Units and Unit Price will not affect your Account  Value.  Beginning on that date,  your Account  Value
will be  determined  based on the change in the value of Units that  reflect  the  Insurance  Charge,  the  Distribution  Charge (if
applicable) and any other optional benefits that you have elected.

TAX CONSIDERATIONS

WHAT ARE SOME OF THE FEDERAL TAX CONSIDERATIONS OF THIS ANNUITY?
Following is a brief summary of some of the Federal tax  considerations  relating to this Annuity.  However,  since the tax laws are
complex and tax consequences are affected by your individual  circumstances,  this summary of our interpretation of the relevant tax
laws is not  intended  to be  fully  comprehensive  nor is it  intended  as tax  advice.  Therefore,  you  may  wish  to  consult  a
professional tax advisor for tax advice as to your particular situation.

HOW ARE AMERICAN SKANDIA AND THE SEPARATE ACCOUNTS TAXED?
The Separate  Accounts are taxed as part of American  Skandia.  American Skandia is taxed as a life insurance  company under Part I,
subchapter  L of the Code.  No taxes are due on  interest,  dividends  and  short-term  or  long-term  capital  gains  earned by the
Separate Accounts with respect to the Annuities.

IN GENERAL, HOW ARE ANNUITIES TAXED?
Section 72 of the Code governs the taxation of annuities in general.  Taxation of the Annuity will depend in large part on:

1.       whether the Annuity is used by:
|X|      a qualified  pension plan,  profit  sharing plan or other  retirement  arrangement  that is eligible for special  treatment
         under the Code (for purposes of this discussion, a "Qualified Contract"); or
|X|      an individual or a corporation, trust or partnership (a "Non-qualified Contract"); and

2.       whether the Owner is:
|X|      an individual person or persons; or
|X|      an entity including a corporation, trust or partnership.

Individual  Ownership:  If one or more  individuals own an Annuity,  the Owner of the Annuity is generally not taxed on any increase
in the value of the Annuity  until an amount is received (a  "distribution").  This is  commonly  referred to as "tax  deferral".  A
distribution  can be in the form of a lump sum payment  including  payment of a Death Benefit,  or in annuity  payments under one of
the annuity payment options.  Certain other transactions may qualify as a distribution and be subject to taxation.

Entity  Ownership:  If the Annuity is owned by an entity and is not a Qualified  Contract,  generally  the Owner of the Annuity must
currently  include  any  increase in the value of the Annuity  during a tax year in its gross  income.  An  exception  from  current
taxation  applies for annuities held by an employer with respect to a terminated  tax-qualified  retirement plan, a trust holding an
annuity as an agent for a natural  person,  or by a decedent's  estate by reason of the death of the decedent.  A tax-exempt  entity
for Federal tax purposes may not be subject to income tax as a result of this provision.

HOW ARE DISTRIBUTIONS TAXED?
Distributions from an Annuity are taxed as ordinary income and not as capital gains.

Distributions  Before  Annuitization:  Distributions  received before annuity  payments begin are generally  treated as coming first
from "income on the contract" and then as a return of the  "investment  in the  contract".  The amount of any  distribution  that is
treated  as receipt of  "income  on the  contract"  is  includible  in the  taxpayer's  gross  income and  taxable in the year it is
received.  The amount of any  distribution  treated as a return of the  "investment  in the  contract"  is not  includible  in gross
income.

|X|      "Income on the  contract" is calculated by  subtracting  the  taxpayer's  "investment  in the contract"  from the aggregate
     value of all "related contracts" (discussed below).
|X|      "Investment  in the  contract"  is equal to  total  purchase  payments  for all  "related  contracts"  minus  any  previous
     distributions  or portions of such  distributions  from such  "related  contracts"  that were not  includible  in gross income.
     "Investment  in the  contract"  may be affected by whether an annuity or any  "related  contract"  was  purchased  as part of a
     tax-free  exchange of life insurance,  endowment,  or annuity  contracts under Section 1035 of the Code. The "investment in the
     contract" for a Qualified Contract will be considered zero for tax reporting purposes.

Distributions  After  Annuitization:  A portion of each  annuity  payment  received on or after the Annuity  Date will  generally be
taxable.  The taxable  portion of each annuity  payment is determined by a formula which  establishes the ratio that the "investment
in the contract"  bears to the total value of annuity  payments to be made.  This is called the  "exclusion  ratio." The  investment
in the contract is excluded  from gross income.  Any portion of an annuity  payment  received that exceeds the exclusion  ratio will
be entirely  includible  in gross  income.  The formula for  determining  the  exclusion  ratio  differs  between fixed and variable
annuity  payments.  When annuity  payments  cease  because of the death of the person upon whose life  payments are based and, as of
the date of death,  the  amount of  annuity  payments  excluded  from  taxable  income by the  exclusion  ratio  does not exceed the
"investment in the contract," then the remaining  portion of unrecovered  investment may be allowed as a deduction on the decedent's
final income tax return.

Penalty Tax on  Distributions:  Generally,  any  distribution  from an annuity  not used in  conjunction  with a Qualified  Contract
(Qualified  Contracts are  discussed  below) is subject to a penalty  equal to 10% of the amount  includible  in gross income.  This
penalty does not apply to certain distributions, including:
|X|      Distributions made on or after the taxpayer has attained age 591/2;
|X|      Distributions made on or after the death of the contract owner, or, if the owner is an entity, the death of the annuitant;
|X|      Distributions attributable to the taxpayer's becoming disabled within the meaning of Code section 72(m)(7);
|X|      Distributions  which are part of a series of  substantially  equal periodic  payments for the life (or life  expectancy) of
     the taxpayer or the joint lives (or joint life expectancies) of the taxpayer and the taxpayer's designated beneficiary;
|X|      Distributions of amounts which are treated as "investments in the contract" made prior to August 14, 1982;
|X|      Payments under an immediate annuity as defined in the Code;
|X|      Distributions under a qualified funding asset under Code Section 130(d); or
|X|      Distributions  from an annuity  purchased by an employer on the termination of a qualified pension plan that is held by the
     employer until the employee separates from service.

Special rules  applicable to "related  contracts":  Contracts  issued by the same insurer to the same contract owner within the same
calendar year (other than certain  contracts owned in connection with a tax-qualified  retirement  arrangement) are to be treated as
one annuity contract when determining the taxation of distributions  before  annuitization.  We refer to these contracts as "related
contracts."  In situations  involving  related  contracts we believe that the values under such  contracts and the investment in the
contracts  will be added  together to determine the proper  taxation of a  distribution  from any one contract  described  under the
section  "Distributions  before  Annuitization."  Generally,  distributions  will be  treated  as coming  first  from  income on the
contract  until all of the  income on all such  related  contracts  is  withdrawn,  and then as a return  of the  investment  in the
contract.  There is some uncertainty  regarding the manner in which the Internal  Revenue Service would view related  contracts when
one or more  contracts are immediate  annuities or are contracts that have been  annuitized.  The Internal  Revenue  Service has not
issued guidance  clarifying this issue as of the date of this Prospectus.  You are  particularly  cautioned to seek advice from your
own tax advisor on this matter.

Special  concerns  regarding  "substantially  equal  periodic  payments":  (also  known as  "72(t)" or  "72(q)"  distributions)  Any
modification to a program of  distributions  which are part of a series of substantially  equal periodic  payments that occur before
the later of the taxpayer  reaching age 59 1/2or five (5) years from the first of such payments will result in the  requirement to pay
the 10%  premature  distribution  penalty  that would have been due had the payments  been  treated as subject to the 10%  premature
distribution  penalty in the years  received,  plus  interest.  This does not apply when the  modification  is by reason of death or
disability.  American Skandia does not currently support a section 72(q) program.

Special concerns regarding immediate  annuities:  The Internal Revenue Service has ruled that the immediate annuity exception to the
10% penalty described above under "Penalty Tax on Distributions" for  "non-qualified"  immediate annuities as defined under the Code
may not apply to annuity payments under a contract  recognized as an immediate  annuity under state insurance law obtained  pursuant
to an exchange of a contract if: (a) purchase  payments for the exchanged  contract  were  contributed  or deemed to be  contributed
more than one year  prior to the  annuity  starting  date  under the  immediate  annuity;  and (b) the  annuity  payments  under the
immediate annuity do not meet the requirements of any other exception to the 10% penalty.

Special rules in relation to tax-free  exchanges under Section 1035:  Section 1035 of the Code permits certain tax-free exchanges of
a life insurance,  annuity or endowment  contract for an annuity.  If an annuity is purchased  through a tax-free exchange of a life
insurance,  annuity or endowment contract that was purchased prior to August 14, 1982, then any distributions  other than as annuity
payments will be considered to come:
|X|      First, from the amount of "investment in the contract" made prior to August 14, 1982 and exchanged into the annuity;
|X|      Then,  from any "income on the  contract"  that is  attributable  to the  purchase  payments  made prior to August 14, 1982
       (including income on such original purchase payments after the exchange);
|X|      Then, from any remaining "income on the contract"; and
|X|      Lastly, from the amount of any "investment in the contract" made after August 13, 1982.

Therefore,  to the extent a distribution is equal to or less than the remaining  investment in the contract made prior to August 14,
1982,  such amounts are not included in taxable  income.  Further,  distributions  received  that are  considered  to be a return of
investment on the contract from purchase  payments made prior to August 14, 1982, such  distributions are not subject to the 10% tax
penalty.  In all other respects,  the general  provisions of the Code apply to distributions from annuities obtained as part of such
an exchange.

Partial  surrenders  may be treated in the same way as tax-free  1035  exchanges of entire  contracts,  therefore  avoiding  current
taxation  of any gains in the  contract  as well as the 10% IRS tax penalty on pre-age 59 1/2withdrawals.  The IRS has  reserved  the
right to treat  transactions it considers abusive as ineligible for this favorable partial 1035 exchange  treatment.  We do not know
what transactions may be considered  abusive.  For example,  we do not know how the IRS may view early withdrawals or annuitizations
after a  partial  exchange.  As of the  date of this  prospectus,  we will  treat a  partial  surrender  of this  type  involving  a
non-qualified  annuity  contract as a "tax-free"  exchange  for future tax  reporting  purposes,  except to the extent that we, as a
reporting and withholding agent,  believe that we would be expected to deem the transaction to be abusive.  However,  some insurance
companies may not recognize  these partial  surrenders  as tax-free  exchanges and may report them as taxable  distributions  to the
extent of any gain  distributed  as well as subjecting the taxable  portion of the  distribution  to the 10% IRS early  distribution
penalty.  We  strongly  urge you to  discuss  any  transaction  of this  type  with  your tax  advisor  before  proceeding  with the
transaction.

There is no guidance from the Internal Revenue Service as to whether a partial  exchange from a life insurance  contract is eligible
for  non-recognition  treatment  under Section 1035 of the Code. We will continue to report a partial  surrender of a life insurance
policy as subject to current  taxation to the extent of any gain.  In addition,  please be cautioned  that no specific  guidance has
been provided as to the impact of such a transaction  on the remaining  life  insurance  policy,  particularly  as to the subsequent
methods  to be used to test for  compliance  under  the Code for both the  definition  of life  insurance  and the  definition  of a
modified endowment contract.

Special  Considerations  for  Purchasers of the Enhanced  Beneficiary  Protection  Optional  Death  Benefit:  As of the date of this
Prospectus,  it is our understanding  that the charges related to the optional Death Benefit are not subject to current taxation and
we will not  report  them as such.  However,  the IRS could  take the  position  that  these  charges  should be  treated as partial
withdrawals  subject to current  taxation to the extent of any gain and, if  applicable,  the 10% tax penalty.  We reserve the right
to report charges for the optional Death Benefit as partial  withdrawals if we, as a reporting and withholding  agent,  believe that
we would be expected to report them as such.

WHAT TAX CONSIDERATIONS ARE THERE FOR TAX-QUALIFIED RETIREMENT PLANS OR QUALIFIED CONTRACTS?
An annuity may be suitable as a funding vehicle for various types of  tax-qualified  retirement  plans.  We have provided  summaries
below of the  types of  tax-qualified  retirement  plans  with  which we may  issue an  Annuity.  These  summaries  provide  general
information  about the tax rules and are not  intended to be  complete  discussions.  The tax rules  regarding  qualified  plans are
complex.  These rules may include limitations on contributions and restrictions on distributions,  including  additional taxation of
distributions  and  additional  penalties.  The  terms  and  conditions  of the  tax-qualified  retirement  plan  may  impose  other
limitations  and  restrictions  that are in  addition  to the terms of the  Annuity.  The  application  of these  rules  depends  on
individual  facts and  circumstances.  Before  purchasing an Annuity for use in a qualified  plan,  you should obtain  competent tax
advice,  both as to the tax treatment and  suitability of such an investment.  American  Skandia does not offer all of its annuities
to all of these types of tax-qualified retirement plans.

Economic Growth and Tax Relief  Reconciliation  Act (EGTRRA):  Certain states do not conform to the pension  provisions  included in
EGTRRA.  We  recommend  that you consult with your tax advisor to  determine  the status of your state's  statutes as they relate to
EGTRRA and your tax qualified retirement plan.

Corporate  Pension and  Profit-sharing  Plans:  Annuities may be used to fund  employee  benefits of various  corporate  pension and
profit-sharing  plans established by corporate  employers under Section 401(a) of the Code including 401(k) plans.  Contributions to
such plans are not taxable to the employee until  distributions  are made from the retirement plan. The Code imposes  limitations on
the amount that may be  contributed  and the timing of  distributions.  The tax  treatment  of  distributions  is subject to special
provisions of the Code, and also depends on the design of the specific  retirement plan.  There are also special  requirements as to
participation, nondiscrimination, vesting and nonforfeitability of interests.

H.R. 10 Plans:  Annuities  may also be used to fund  benefits of retirement  plans  established  by  self-employed  individuals  for
themselves and their  employees.  These are commonly  known as "H.R. 10 Plans" or "Keogh Plans".  These plans are subject to most of
the same types of limitations and  requirements as retirement  plans  established by corporations.  However,  the exact  limitations
and requirements may differ from those for corporate plans.

Tax Sheltered  Annuities:  Under Section 403(b) of the Code, a tax sheltered annuity ("TSA") is a contract into which  contributions
may be  made  by  certain  qualifying  employers  such  as  public  schools  and  certain  charitable,  educational  and  scientific
organizations  specified  in Section  501(c)(3)  for the  benefit of their  employees.  Such  contributions  are not  taxable to the
employee  until  distributions  are made from the TSA.  The Code  imposes  limits on  contributions,  transfers  and  distributions.
Nondiscrimination requirements also apply.

Section 457 Plans:  Under Section 457 of the Code,  deferred  compensation  plans  established by governmental and certain other tax
exempt  employers  for their  employees  may invest in annuity  contracts.  The Code limits  contributions  and  distributions,  and
imposes  eligibility  requirements as well.  Contributions  are not taxable to employees until  distributed from the plan.  However,
plan assets  remain the  property of the  employer  and are subject to the claims of the  employer's  general  creditors  until such
assets are made available to participants or their beneficiaries.

Individual  Retirement  Arrangements  or "IRAs":  Section  408 of the Code allows  eligible  individuals  to maintain an  individual
retirement  account  or  individual  retirement  annuity  ("IRA").  IRAs  are  subject  to  limitations  on the  amount  that may be
contributed,  the  contributions  that may be deducted from taxable income,  the persons who may be eligible to establish an IRA and
the time when  distributions  must commence.  Further,  an Annuity may be established  with "roll-over"  distributions  from certain
tax-qualified retirement plans and maintain the tax-deferred status of these amounts.

Roth IRAs:  A form of IRA is also  available  called a "Roth  IRA".  Contributions  to a Roth IRA are not tax  deductible.  However,
distributions  from a Roth IRA are free from  Federal  income taxes and are not subject to the 10% penalty tax if five (5) tax years
have passed since the first  contribution  was made or any conversion from a traditional  IRA was made and the  distribution is made
(a) once the taxpayer is age 59 1/2or older,  (b) upon the death or disability of the taxpayer,  or (c) for qualified  first-time home
buyer expenses,  subject to certain  limitations.  Distributions  from a Roth IRA that are not "qualified" as described above may be
subject to Federal income and penalty taxes.

Purchasers  of IRAs and Roth  IRAs  will  receive a  special  disclosure  document,  which  describes  limitations  on  eligibility,
contributions,  transferability  and  distributions.  It also  describes  the  conditions  under which  distributions  from IRAs and
qualified  plans  may be  rolled  over or  transferred  into an IRA or  another  qualified  plan,  on a  tax-deferred  basis and the
conditions  under which  distributions  from  traditional IRAs may be rolled over to, or the traditional IRA itself may be converted
into, a Roth IRA.

SEP IRAs:  Eligible  employers  that meet  specified  criteria may  establish  Simplified  Employee  Pensions or SEP IRAs.  Employer
contributions  that may be made to employee SEP IRAs are larger than the amounts that may be  contributed  to other IRAs, and may be
deductible to the employer.

HOW ARE DISTRIBUTIONS FROM QUALIFIED CONTRACTS TAXED?
Distributions  from  Qualified  Contracts are generally  taxed under  Section 72 of the Code.  Under these rules,  a portion of each
distribution  may be excludable  from income.  The  excludable  amount is the proportion of a  distribution  representing  after-tax
contributions.  Generally,  a 10% penalty tax applies to the taxable portion of a distribution from a Qualified  Contract made prior
to age 59 1/2.  However, the 10% penalty tax does not apply when the distribution:
|X|      is part of a properly executed transfer to another IRA or another eligible qualified account;
|X|      is subsequent to the death or  disability  of the taxpayer (for this purpose  disability is as defined in Section  72(m)(7)
     of the Code);
|X|      is part of a series  of  substantially  equal  periodic  payments  to be paid not less  frequently  than  annually  for the
     taxpayer's life or life expectancy or for the joint lives or life expectancies of the taxpayer and a designated beneficiary;
|X|      is subsequent to a separation from service after the taxpayer attains age 55*;
|X|      does not exceed the employee's allowable deduction in that tax year for medical care;
|X|      is made to an alternate payee pursuant to a qualified domestic relations order*;
|X|      is made pursuant to an IRS levy;
|X|      is made to pay qualified acquisition costs for a first time home purchase (IRA only);
|X|      is made to pay qualified higher education expenses (IRA only); and
|X|      is not more than the cost of your medical insurance (IRA only).

The exceptions above which are followed by an asterisk (*) do not apply to IRAs.  Certain other exceptions may be available.

Minimum  Distributions  after age 70 1/2: A participant's  interest in a Qualified Contract must generally be distributed,  or begin to
be distributed, by the "required beginning date".  This is April 1st of the calendar year following the later of:
|X|      the calendar year in which the individual attains age 70 1/2; or
|X|      the calendar  year in which the  individual  retires from service with the employer  sponsoring  the plan.  The  retirement
      option is not available to IRAs.

The IRS has released Treasury  regulations  containing new Minimum  Distribution rules. For Minimum  Distributions  required in 2003
and later,  individuals  are  required  to use the rules  under the 2002 Final  Regulations.  The 2002 Final  Regulations  contain a
provision  which  could  increase  the  amount of minimum  distributions  required  for  certain  individuals.  Under the 2002 Final
Regulations,  individuals  are required to include in their annuity  contract  value the actuarial  value of any other benefits that
will be provided  under the annuity.  We and other annuity  providers  are currently  seeking  clarification  of this new rule.  You
should consult your tax adviser to determine the impact of this rule on your Minimum Distributions.

Under the new Minimum  Distribution  rules, a uniform life expectancy table will be utilized by all participants except those with a
spouse who is more than ten (10)  years  younger  than the  participant.  In that case,  the new rules  permit  the  participant  to
utilize the actual life  expectancies of the participant  and the spouse.  In most cases,  the beneficiary may be changed during the
participant's  lifetime with no affect on the Minimum  Distributions.  At death,  the  designated  Beneficiary  may  generally  take
Minimum Distributions over his/her life expectancy or in a lump sum.

If the amount  distributed is less than the minimum  required  distribution for the year, the participant is subject to a 50% tax on
the amount that was not properly  distributed.  Because of the many recent changes to the Minimum  Distribution  rules,  we strongly
encourage you to consult with your tax advisor for more detailed information.

GENERAL TAX CONSIDERATIONS

Diversification:  Section  817(h) of the Code provides that a variable  annuity  contract,  in order to qualify as an annuity,  must
have an "adequately  diversified"  segregated asset account (including  investments in a mutual fund by the segregated asset account
of  insurance  companies).  If the  diversification  requirements  under the Code are not met and the  annuity is not  treated as an
annuity,  the  taxpayer  will be subject to income tax on the annual gain in the  contract.  The Treasury  Department's  regulations
prescribe the  diversification  requirements  for variable  annuity  contracts.  We expect the underlying  mutual fund portfolios to
comply with the terms of these regulations.

Transfers Between Investment  Options:  Transfers between investment  options are not subject to taxation.  The Treasury  Department
may  promulgate  guidelines  under  which a variable  annuity  will not be treated as an annuity for tax  purposes  if persons  with
ownership  rights have excessive  control over the  investments  underlying  such variable  annuity.  Such guidelines may or may not
address the number of investment  options or the number of transfers  between  investment  options offered under a variable annuity.
It is not known whether such guidelines,  if in fact promulgated,  would have retroactive  effect. It is also not known what effect,
if any, such guidelines may have on transfers  between the investment  options of the Annuity offered  pursuant to this  Prospectus.
We will take any action,  including  modifications to your Annuity or the  Sub-accounts,  required to comply with such guidelines if
promulgated.

Federal  Income Tax  Withholding:  Section  3405 of the Code  provides  for  Federal  income  tax  withholding  on the  portion of a
distribution  which is  includible  in the gross  income of the  recipient.  Amounts to be  withheld  depend  upon the nature of the
distribution.  However,  under most  circumstances  a recipient  may elect not to have income  taxes  withheld or have income  taxes
withheld at a different rate by filing a completed election form with us.

Certain  distributions,  known as  eligible  rollover  distributions,  from  Qualified  Contracts,  are  subject  to  automatic  20%
withholding for Federal income taxes. The following  distributions  are not eligible  rollover  distributions and not subject to 20%
withholding:
|X|      any portion of a distribution paid as a Minimum Distribution;
|X|      direct transfers to the trustee of another retirement plan;
|X|      distributions from an individual retirement account or individual retirement annuity;
|X|      distributions  made as  substantially  equal periodic  payments for the life or life  expectancy of the  participant in the
     retirement plan or the life or life expectancy of such participant and his or her designated beneficiary under such plan;
|X|      distributions  that are part of a series of substantial  periodic  payments pursuant to Section 72(q) or 72(t) of the Code;
     and
|X|      certain other distributions where automatic 20% withholding may not apply.

Loans,  Assignments  and Pledges:  Any amount  received  directly or indirectly  as a loan from, or any  assignment or pledge of any
portion of the value of, an annuity  before annuity  payments have begun is treated as a distribution  subject to taxation under the
distribution  rules set forth  above.  Any gain in an annuity on or after the  assignment  or pledge of an entire  annuity and while
such  assignment  or pledge  remains  in effect is  treated as  "income  on the  contract"  in the year in which it is  earned.  For
annuities not issued as Qualified  Contracts,  the cost basis of the annuity is increased by the amount of any  assignment or pledge
includible  in gross  income.  The cost basis is not affected by any repayment of any loan for which the annuity is collateral or by
payment of any interest thereon.

Gifts:  The gift of an annuity to someone  other than the spouse of the owner (or former  spouse  incident to a divorce) is treated,
for income tax purposes, as a distribution.

Estate and Gift Tax  Considerations:  You should obtain  competent tax advice with respect to possible  federal and state estate and
gift tax consequences flowing from the ownership and transfer of annuities.

Generation-Skipping  Transfers:  Under the Code  certain  taxes may be due when all or part of an  annuity is  transferred  to, or a
death  benefit is paid to, an  individual  two or more  generations  younger than the  contract  holder.  These  generation-skipping
transfers  generally  include those subject to federal estate or gift tax rules.  There is an aggregate $1.1 million  exemption from
taxes for all such  transfers.  We may be required to determine  whether a  transaction  is a direct skip as defined in the Code and
the amount of the  resulting  tax. We will  deduct from your  Annuity or from any  applicable  payment  treated as a direct skip any
amount of tax we are required to pay.

Considerations  for Contingent  Annuitants:  There may be adverse tax consequences if a contingent  annuitant  succeeds an annuitant
when the Annuity is owned by a trust that is neither tax exempt nor  qualifies  for preferred  treatment  under certain  sections of
the Code.  In general,  the Code is designed  to prevent  indefinite  deferral  of tax.  Continuing  the benefit of tax  deferral by
naming one or more contingent  annuitants  when the Annuity is owned by a  non-qualified  trust might be deemed an attempt to extend
the tax deferral for an indefinite  period.  Therefore,  adverse tax treatment may depend on the terms of the trust, who is named as
contingent  annuitant,  as well as the  particular  facts and  circumstances.  You should  consult your tax advisor  before naming a
contingent annuitant if you expect to use an Annuity in such a fashion.

GENERAL INFORMATION

HOW WILL I RECEIVE STATEMENTS AND REPORTS?
We send any  statements  and reports  required by applicable  law or  regulation  to you at your last known  address of record.  You
should  therefore give us prompt notice of any address change.  We reserve the right, to the extent  permitted by law and subject to
your prior  consent,  to provide  any  prospectus,  prospectus  supplements,  confirmations,  statements  and  reports  required  by
applicable  law or  regulation  to you  through  our  Internet  Website  at  http://www.americanskandia.prudential.com  or any other
electronic  means,  including  diskettes  or CD ROMs.  We send a  confirmation  statement  to you each  time a  transaction  is made
affecting Account Value, such as making additional Purchase Payments,  transfers,  exchanges or withdrawals.  We also send quarterly
statements  detailing  the  activity  affecting  your  Annuity  during the  calendar  quarter.  We may confirm  regularly  scheduled
transactions,  such  as the  Annual  Maintenance  Fee,  systematic  withdrawals  (including  72(t)  payments  and  required  minimum
distributions),  bank drafting,  dollar cost averaging,  and static rebalancing,  in quarterly statements instead of confirming them
immediately.  You should review the information in these statements  carefully.  You may request additional  reports. We reserve the
right to charge up to $50 for each such additional report.

Any errors or  corrections  on  transactions  for your  Annuity  must be  reported to us at our Office as soon as possible to assure
proper accounting to your Annuity. For transactions that are confirmed  immediately,  we assume all transactions are accurate unless
you notify us otherwise  within 30 days from the date you receive the  confirmation.  For  transactions  that are first confirmed on
the quarterly  statement,  we assume all transactions are accurate unless you notify us within 30 days from the date you receive the
quarterly  statement.  All transactions  confirmed  immediately or by quarterly statement are deemed conclusive after the applicable
30-day  period.  We may also send an annual report and a semi-annual  report  containing  applicable  financial  statements  for the
Separate Account and the Portfolios,  as of December 31 and June 30, respectively,  to Owners or, with your prior consent, make such
documents available electronically through our Internet Website or other electronic means.

WHO IS AMERICAN SKANDIA?
American Skandia Life Assurance  Corporation  ("American  Skandia") is a stock life insurance  company domiciled in Connecticut with
licenses in all 50 states,  the District of Columbia and Puerto Rico.  American  Skandia is a  wholly-owned  subsidiary  of American
Skandia,  Inc.  ("ASI").  American Skandia markets its products to broker-dealers  and financial  planners through an internal field
marketing staff. In addition,  American Skandia markets through and in conjunction  with financial  institutions  such as banks that
are permitted directly, or through affiliates, to sell annuities.

American  Skandia is in the  business  of issuing  annuity  and life  insurance  products.  American  Skandia  currently  offers the
following  products:  (a) flexible premium deferred  annuities and single premium fixed deferred  annuities that are registered with
the SEC; (b) certain other fixed  deferred  annuities that are not  registered  with the SEC; (c) both fixed and variable  immediate
adjustable annuities; and (d) a single premium variable life insurance policy that is registered with the SEC.

Effective May 1, 2003,  Skandia U.S. Inc., the sole  shareholder of ASI, which is the parent of American  Skandia,  was purchased by
Prudential  Financial,  Inc.  Prudential  Financial is a New Jersey  insurance  holding  company whose  subsidiary  companies  serve
individual and institutional  customers worldwide and include The Prudential  Insurance Company of America,  one of the largest life
insurance  companies in the U.S. These  companies offer a variety of products and services,  including life insurance,  property and
casualty  insurance,  mutual funds,  annuities,  pension and  retirement  related  services and  administration,  asset  management,
securities brokerage, banking and trust services, real estate brokerage franchises, and relocation services.

No company  other than  American  Skandia has any legal  responsibility  to pay amounts  that it owes under its annuity and variable
life  insurance  contracts.  However,  following the closing of the  acquisition,  Prudential  Financial  will exercise  significant
influence over the operations and capital structure of American Skandia.

WHAT ARE SEPARATE ACCOUNTS?
The separate  accounts are where American  Skandia sets aside and invests the assets of some of our annuities.  In the  accumulation
period,  assets  supporting  Account Values of the Annuities are held in a separate account  established under the laws of the State
of Connecticut.  We are the legal owner of assets in the separate  accounts.  In the payout period,  assets supporting fixed annuity
payments  and any  adjustable  annuity  payments we make  available  are held in our general  account.  Assets  supporting  variable
annuity  payment  options  may be invested in our  separate  accounts.  Income,  gains and losses  from  assets  allocated  to these
separate  accounts are credited to or charged against each such separate account without regard to other income,  gains or losses of
American Skandia or of any other of our separate  accounts.  These assets may only be charged with liabilities  which arise from the
Annuities  issued by American  Skandia.  The amount of our obligation in relation to allocations to the Sub-accounts is based on the
investment performance of such Sub-accounts.  However, the obligations themselves are our general corporate obligations.

Separate Account B
During the accumulation  period, the assets supporting  obligations based on allocations to the variable investment options are held
in  Sub-accounts  of American  Skandia Life  Assurance  Corporation  Variable  Account B, also referred to as "Separate  Account B".
Separate  Account B was  established by us pursuant to Connecticut  law on November 25, 1987.  Separate  Account B also holds assets
of other annuities issued by us with values and benefits that vary according to the investment performance of Separate Account B.

Separate  Account B consists  of  multiple  Sub-accounts.  Each  Sub-account  invests  only in a single  mutual  fund or mutual fund
portfolio.  The name of each  Sub-account  generally  corresponds  to the name of the  underlying  Portfolio.  Each  Sub-account  in
Separate Account B may have several  different Unit Prices to reflect the Insurance  Charge,  Distribution  Charge (when applicable)
and the charges for any optional  benefits that are offered  under this Annuity and other  annuities  issued by us through  Separate
Account B. Separate Account B is registered with the SEC under the Investment  Company Act of 1940  ("Investment  Company Act") as a
unit  investment  trust,  which is a type of investment  company.  The SEC does not  supervise  investment  policies,  management or
practices of Separate Account B.

Prior to November 18, 2002,  Separate Account B was organized as a single separate account with six different  Sub-account  classes,
each of which was registered as a distinct unit  investment  trust under the Investment  Company Act.  Effective  November 18, 2002,
each Sub-account  class of Separate  Account B was consolidated  into the unit investment trust formerly named American Skandia Life
Assurance  Corporation  Variable  Account B (Class 1 Sub-accounts),  which was subsequently  renamed American Skandia Life Assurance
Corporation  Variable  Account B. Each  Sub-account  of Separate  Account B has  multiple  Unit  Prices to reflect the daily  charge
deducted for each combination of the applicable  Insurance  Charge,  Distribution  Charge (when  applicable) and the charge for each
optional benefit offered under Annuity  contracts  funded through  Separate  Account B. The  consolidation of Separate Account B had
no impact on Annuity Owners.


We reserve the right to make  changes to the  Sub-accounts  available  under the Annuity as we determine  appropriate.  We may offer
new  Sub-accounts,  eliminate  Sub-accounts,  or combine  Sub-accounts  at our sole  discretion.  We may also close  Sub-accounts to
additional  Purchase  Payments on existing Annuity  contracts or close  Sub-accounts  for Annuities  purchased on or after specified
dates.  We may also substitute an underlying  mutual fund or portfolio of an underlying  mutual fund for another  underlying  mutual
fund or  portfolio  of an  underlying  mutual fund,  subject to our receipt of any  exemptive  relief that we are required to obtain
under the Investment Company Act.  We will notify Owners of changes we make to the Sub-accounts available under the Annuity.

Values and benefits based on  allocations to the  Sub-accounts  will vary with the investment  performance of the underlying  mutual
funds or fund  portfolios,  as  applicable.  We do not  guarantee  the  investment  results of any  Sub-account.  Your Account Value
allocated  to the  Sub-accounts  may increase or  decrease.  You bear the entire  investment  risk.  There is no assurance  that the
Account Value of your Annuity will equal or be greater than the total of the Purchase Payments you make to us.

Separate Account D
During the  accumulation  period,  assets  supporting our obligations  based on Fixed  Allocations are held in American Skandia Life
Assurance  Corporation  Separate  Account D, also  referred to as  "Separate  Account D".  Such  obligations  are based on the fixed
interest  rates we credit to Fixed  Allocations  and the terms of the Annuities.  These  obligations do not depend on the investment
performance of the assets in Separate Account D.  Separate Account D was established by us pursuant to Connecticut law.

There are no units in Separate  Account D. The Fixed  Allocations  are  guaranteed  by our  general  account.  An Annuity  Owner who
allocates a portion of their Account  Value to Separate  Account D does not  participate  in the  investment  gain or loss on assets
maintained  in  Separate  Account  D. Such gain or loss  accrues  solely to us. We retain  the risk that the value of the  assets in
Separate  Account D may drop below the reserves and other  liabilities we must maintain.  Should the value of the assets in Separate
Account D drop below the reserve and other  liabilities we must maintain in relation to the annuities  supported by such assets,  we
will transfer  assets from our general  account to Separate  Account D to make up the  difference.  We have the right to transfer to
our  general  account any assets of Separate  Account D in excess of such  reserves  and other  liabilities.  We maintain  assets in
Separate Account D supporting a number of annuities we offer.

We  currently  employ  investment  managers  to manage the  assets  maintained  in  Separate  Account  D. Each  manager we employ is
responsible  for  investment  management  of a different  portion of  Separate  Account D. From time to time  additional  investment
managers  may be employed or  investment  managers may cease being  employed.  We are under no  obligation  to employ or continue to
employ any investment manager(s) and have sole discretion over the investment managers we retain.

We are not obligated to invest  according to specific  guidelines or strategies  except as may be required by Connecticut  and other
state insurance laws.

WHAT IS THE LEGAL STRUCTURE OF THE UNDERLYING FUNDS?
Each underlying  mutual fund is registered as an open-end  management  investment  company under the Investment  Company Act. Shares
of the underlying  mutual fund portfolios are sold to separate  accounts of life insurance  companies  offering variable annuity and
variable life insurance products.  The shares may also be sold directly to qualified pension and retirement plans.

Voting Rights
We are the legal owner of the shares of the underlying  mutual funds in which the  Sub-accounts  invest.  However,  under SEC rules,
you have voting  rights in relation  to Account  Value  maintained  in the  Sub-accounts.  If an  underlying  mutual fund  portfolio
requests a vote of  shareholders,  we will vote our shares based on  instructions  received from Owners with Account Value allocated
to that  Sub-account.  Owners have the right to vote an amount equal to the number of shares  attributable  to their  contracts.  If
we do not receive voting  instructions  in relation to certain  shares,  we will vote those shares in the same manner and proportion
as the shares  for which we have  received  instructions.  We will  furnish  those  Owners who have  Account  Value  allocated  to a
Sub-account  whose  underlying  mutual fund portfolio has requested a "proxy" vote with proxy  materials and the necessary  forms to
provide us with their voting  instructions.  Generally,  you will be asked to provide instructions for us to vote on matters such as
changes in a  fundamental  investment  strategy,  adoption  of a new  investment  advisory  agreement,  or matters  relating  to the
structure of the underlying mutual fund that require a vote of shareholders.

American  Skandia  Trust (the  "Trust") has obtained an  exemption  from the  Securities  and Exchange  Commission  that permits its
investment adviser,  American Skandia Investment Services,  Incorporated ("ASISI"),  subject to approval by the Board of Trustees of
the Trust, to change  sub-advisors  for a Portfolio and to enter into new sub-advisory  agreements,  without  obtaining  shareholder
approval of the changes.  This exemption (which is similar to exemptions  granted to other  investment  companies that are organized
in a similar manner as the Trust) is intended to facilitate the efficient  supervision  and management of the  sub-advisors by ASISI
and the  Trustees.  The Trust is  required,  under the terms of the  exemption,  to  provide  certain  information  to  shareholders
following these types of changes.

Material Conflicts
It is possible that  differences  may occur between  companies  that offer shares of an  underlying  mutual fund  portfolio to their
respective  separate  accounts  issuing  variable  annuities  and/or  variable life insurance  products.  Differences may also occur
surrounding the offering of an underlying  mutual fund portfolio to variable life insurance  policies and variable annuity contracts
that we offer.  Under certain  circumstances,  these  differences could be considered  "material  conflicts," in which case we would
take  necessary  action to protect  persons with voting rights under our variable  annuity  contracts  and variable  life  insurance
policies  against  persons  with  voting  rights  under other  insurance  companies'  variable  insurance  products.  If a "material
conflict" were to arise between owners of variable  annuity  contracts and variable life  insurance  policies  issued by us we would
take  necessary  action to treat such  persons  equitably  in  resolving  the  conflict.  "Material  conflicts"  could  arise due to
differences  in voting  instructions  between  owners of variable  life  insurance  and  variable  annuity  contracts of the same or
different companies.  We monitor any potential conflicts that may exist.

Service Fees Payable to American Skandia
American  Skandia or our  affiliates  have  entered  into  agreements  with the  investment  adviser or  distributor  of many of the
underlying  Portfolios.  Under the terms of these agreements,  American Skandia provides  administrative and support services to the
Portfolios for which a fee is paid that is generally based on a percentage of the average assets  allocated to the Portfolios  under
the Annuity.  Any fees payable  will be  consistent  with the services  rendered or the  expected  cost savings  resulting  from the
arrangement.  These agreements may be different for each underlying mutual fund whose portfolios are offered as Sub-accounts.

WHO DISTRIBUTES ANNUITIES OFFERED BY AMERICAN SKANDIA?
American Skandia  Marketing,  Incorporated  ("ASM"),  a wholly-owned  subsidiary of American  Skandia,  Inc., is the distributor and
principal  underwriter of the securities  offered  through this  prospectus.  ASM acts as the distributor of a number of annuity and
life  insurance  products we offer and both American  Skandia Trust and American  Skandia  Advisor  Funds,  Inc., a family of retail
mutual  funds.  ASM also acts as an  introducing  broker-dealer  through  which it receives a portion of  brokerage  commissions  in
connection  with  purchases  and sales of securities  held by  portfolios of American  Skandia Trust which are offered as underlying
investment options under the Annuity.

ASM's principal business address is One Corporate Drive,  Shelton,  Connecticut 06484. ASM is registered as broker-dealer  under the
Securities Exchange Act of 1934 ("Exchange Act") and is a member of the National Association of Securities Dealers, Inc. ("NASD").

The Annuity is offered on a continuous  basis.  ASM enters into  distribution  agreements with  independent  broker-dealers  who are
registered  under the Exchange Act and with entities that may offer the Annuity but are exempt from  registration.  Applications for
the Annuity are solicited by registered  representatives of those firms. Such  representatives  will also be our appointed insurance
agents under state insurance law.  In addition, ASM may offer the Annuity directly to potential purchasers.

Compensation  is paid to firms on sales of the Annuity  according  to one or more  schedules.  The  individual  representative  will
receive a portion of the  compensation,  depending on the practice of the firm.  Compensation  is generally based on a percentage of
Purchase  Payments  made, up to a maximum of 7.0%.  Alternative  compensation  schedules are available  that provide a lower initial
commission  plus ongoing  annual  compensation  based on all or a portion of Account  Value.  We may also provide  compensation  for
providing  ongoing  service to you in relation to the Annuity.  Commissions and other  compensation  paid in relation to the Annuity
do not result in any additional charge to you or to the Separate Account.

In addition,  firms may receive  separate  compensation  or  reimbursement  for,  among other things,  training of sales  personnel,
marketing or other services they provide to us or our affiliates.  We or ASM may enter into  compensation  arrangements with certain
firms.  These  arrangements  will not be offered to all firms and the terms of such  arrangements may differ between firms. Any such
compensation  will be paid by us or ASM and will not result in any additional  charge to you. To the extent  permitted by NASD rules
and other  applicable laws and  regulations,  ASM may pay or allow other  promotional  incentives or payments in the form of cash or
other compensation.

Advertising:  We may  advertise  certain  information  regarding  the  performance  of the  investment  options.  Details  on how we
calculate  performance for the  Sub-accounts  are found in the Statement of Additional  Information.  This  information may help you
review the performance of the investment  options and provide a basis for comparison with other  annuities.  This information may be
less useful when  comparing  the  performance  of the  investment  options with other  savings or  investment  vehicles.  Such other
investments  may not  provide  some of the  benefits  of  annuities,  or may not be  designed  for  long-term  investment  purposes.
Additionally  other savings or investment  vehicles may not be receive the  beneficial  tax treatment  given to annuities  under the
Code.

We may advertise the performance of the Portfolios in the form of "Standard" and  "Non-standard"  Total Returns  calculated for each
Sub-account.  "Standard Total Return" figures assume a hypothetical  initial  investment of $1,000 allocated to a Sub-account during
the most recent,  one, five and ten year periods (or since the inception  date that the Portfolio has been offered as a Sub-account,
if less).  "Standard  Total  Return"  figures  assume  that the  applicable  Insurance  Charge,  Distribution  Charge and the Annual
Maintenance  Fee are deducted and that the Annuity is surrendered at the end of the applicable  period,  meaning that any Contingent
Deferred  Sales  Charge  that would  apply upon  surrender  is also  deducted.  "Non-standard  Total  Return"  figures  include  any
performance  figures that do not meet the SEC's rules for Standard Total Returns.  Non-standard  Total Returns are calculated in the
same manner as  standardized  returns except that the figures may not reflect all fees and charges.  In particular,  they may assume
no surrender  at the end of the  applicable  period so that the CDSC does not apply.  "Non-standard  Total  Returns" may also assume
that the Annual  Maintenance  Fee does not apply due to the average  Account Value being greater than $100,000,  where the charge is
waived.  Standard and  Non-standard  Total Returns will not reflect the  additional  asset-based  charges that are deducted when you
elect any optional  benefits.  The additional cost associated with any optional  benefits you elected will reduce your  performance.
Non-standard Total Returns must be accompanied by Standard Total Returns.

Some of the  underlying  Portfolios  existed  prior to the  inception  of these  Sub-accounts.  Performance  quoted  in  advertising
regarding  such  Sub-accounts  may indicate  periods during which the  Sub-accounts  have been in existence but prior to the initial
offering of the Annuities,  or periods during which the underlying  Portfolios  have been in existence,  but the  Sub-accounts  have
not. Such hypothetical  historical  performance is calculated using the same assumptions  employed in calculating actual performance
since inception of the  Sub-accounts.  Hypothetical  historical  performance of the underlying  Portfolios prior to the existence of
the Sub-accounts may only be presented as Non-standard Total Returns.

We may advertise the  performance  of money  market-type  Sub-accounts  using a measure of the "current and  effective  yield".  The
current yield of a money  market-type  Sub-account  is  calculated  based upon the previous  seven-day  period ending on the date of
calculation.  The effective yield of a money  market-type  Sub-account  reflects the  reinvestment of net income earned daily on the
assets of such a Sub-account.  The current and effective yields reflect the Insurance  Charge,  Distribution  Charge (if applicable)
and the charge for any optional  benefits (if applicable)  deducted  against the  Sub-account.  In a low interest rate  environment,
yields for money  market-type  Sub-accounts,  after deduction of the Insurance Charge,  Distribution  Charge (if applicable) and the
charge for any optional  benefits (if  applicable)  may be negative  even though the yield  (before  deducting  for such charges) is
positive.  Current and effective yield  information  will fluctuate.  This  information may not provide a basis for comparisons with
deposits in banks or other  institutions  which pay a fixed yield over a stated period of time, or with  investment  companies which
do not serve as underlying mutual funds for variable  annuities and/or do not have additional  asset-based  charges deducted for the
insurance protection provided by the Annuity.

Performance  information on the Sub-accounts is based on past performance only and is not an indication or  representation of future
performance.  Performance of the Sub-accounts is not fixed.  Actual  performance  will depend on the type,  quality and, for some of
the  Sub-accounts,  the maturities of the investments held by the underlying  mutual funds or portfolios and upon prevailing  market
conditions and the response of the underlying  mutual funds to such  conditions.  Actual  performance will also depend on changes in
the expenses of the underlying  mutual funds or portfolios.  Such changes are reflected,  in turn, in the Sub-accounts  which invest
in such  underlying  mutual  fund or  portfolio.  In  addition,  the total  amount of  asset-based  charges  assessed  against  each
Sub-account will affect performance.

The information we may advertise  regarding the Fixed  Allocations  may include the then current  interest rates we are crediting to
new Fixed  Allocations.  Information  on  current  rates  will be as of the date  specified  in such  advertisement.  Rates  will be
included in  advertisements  to the extent  permitted by law. Given that the actual rates  applicable to any Fixed Allocation are as
of the date of any such Fixed  Allocation's  Guarantee  Period begins,  the rate credited to a Fixed  Allocation may be more or less
than those quoted in an advertisement.

Advertisements  we distribute may also compare the  performance of our  Sub-accounts  with: (a) certain  unmanaged  market  indices,
including but not limited to the Dow Jones Industrial  Average,  the Standard & Poor's 500, the NASDAQ 100, the Shearson Lehman Bond
Index,  the Frank Russell  non-U.S.  Universal Mean, the Morgan Stanley  Capital  International  Index of Europe,  Asia and Far East
Funds, and the Morgan Stanley Capital  International World Index; and/or (b) other management  investment  companies with investment
objectives  similar to the mutual fund or portfolio  underlying the  Sub-accounts  being compared.  This may include the performance
ranking assigned by various publications,  including but not limited to the Wall Street Journal,  Forbes,  Fortune, Money, Barron's,
Business Week, USA Today and  statistical  services,  including but not limited to Lipper  Analytical  Services Mutual Funds Survey,
Lipper Annuity and Closed End Survey,  the Variable  Annuity Research Data Survey,  SEI, the Morningstar  Mutual Fund Sourcebook and
the Morningstar Variable Annuity/Life Sourcebook.

American Skandia Life Assurance  Corporation may advertise its rankings and/or ratings by independent  financial  ratings  services.
Such rankings may help you in evaluating  our ability to meet our  obligations in relation to Fixed  Allocations,  pay minimum death
benefits,  pay annuity  payments or administer  Annuities.  Such rankings and ratings do not reflect or relate to the performance of
Separate Account B.

AVAILABLE INFORMATION
A Statement of  Additional  Information  is available  from us without  charge upon your  request.  This  Prospectus  is part of the
registration  statement we filed with the SEC regarding this offering.  Additional  information on us and this offering is available
in those  registration  statements and the exhibits  thereto.  You may obtain copies of these materials at the prescribed rates from
the SEC's Public Reference  Section,  450 Fifth Street N.W.,  Washington,  D.C., 20549. You may inspect and copy those  registration
statements  and  exhibits  thereto at the SEC's  public  reference  facilities  at the above  address,  Room 1024,  and at the SEC's
Regional Offices,  The Woolworth Building,  233 Broadway,  New York, NY and 175 W. Jackson Boulevard,  Suite 900, Chicago, IL. These
documents,   as  well  as  documents  incorporated  by  reference,   may  also  be  obtained  through  the  SEC's  Internet  Website
(http://www.sec.gov) for this registration statement as well as for other registrants that file electronically with the SEC.

INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
To the extent and only to the extent that any statement in a document  incorporated  by reference  into this  Prospectus is modified
or  superseded  by a statement in this  Prospectus  or in a  later-filed  document,  such  statement is hereby deemed so modified or
superseded and not part of this  Prospectus.  The Annual Report on Form 10-K for the year ended December 31, 2002  previously  filed
by the Company with the SEC under the Exchange Act is incorporated by reference in this Prospectus.

We will furnish you without charge a copy of any or all of the documents  incorporated  by reference in this  Prospectus,  including
any exhibits to such documents which have been  specifically  incorporated by reference.  We will do so upon receipt of your written
or oral request.

HOW TO CONTACT US
You can contact us by:
|X|      calling our  Customer  Service  Team at  1-800-680-8920,  or  Skandia's  Telephone  Automated  Response  System  (STARS) at
       1-800-766-4530.
|X|      writing to us via regular mail at American Skandia - Variable  Annuities,  Attention:  Stagecoach  Annuity,  P.O. Box 7040,
       Bridgeport,  Connecticut 06601-7040 OR for express mail American Skandia - Variable Annuities, Attention: Stagecoach Annuity,
       One Corporate Drive,  Shelton,  Connecticut  06484. NOTE: Failure to send mail to the proper address may result in a delay in
       our receiving and processing your request.
|X|      sending an email to service@prudential.com or visiting our Internet Website at www.americanskandia.prudential.com.
|X|      accessing information about your Annuity through our Internet Website at www.americanskandia.prudential.com.

You   can   obtain   account    information    through   Skandia's    Telephone   Automated   Response   System   (STARS)   and   at
www.americanskandia.prudential.com,  our Internet Website.  Our Customer Service  representatives are also available during business
hours to provide you with  information  about your  account.  You can request  certain  transactions  through  our  telephone  voice
response system,  our Internet  Website or through a customer  service  representative.  You can provide  authorization  for a third
party,  including  your  attorney-in-fact  acting  pursuant  to a power of attorney or an  investment  professional,  to access your
account  information  and perform  certain  transactions  on your  account.  You will need to  complete a form  provided by us which
identifies  those  transactions  that you wish to authorize via telephonic and electronic  means and whether you wish to authorize a
third party to perform any such  transactions.  We require that you or your  representative  provide  proper  identification  before
performing  transactions  over the  telephone or through our Internet  Website.  This may include a Personal  Identification  Number
(PIN) that will be  provided  to you upon  issue of your  Annuity  or you may  establish  or change  your PIN  through  STARS and at
www.americanskandia.prudential.com,  our Internet Website.  Any third party that you authorize to perform financial  transactions on
your account will be assigned a PIN for your account.

Transactions  requested  via  telephone are recorded.  To the extent  permitted by law, we will not be  responsible  for any claims,
loss,  liability or expense in connection with a transaction  requested by telephone or other  electronic  means if we acted on such
transaction  instructions  after following  reasonable  procedures to identify those persons  authorized to perform  transactions on
your  Annuity  using  verification  methods  which may  include a request  for your  Social  Security  number,  PIN or other form of
electronic  identification.  We may be liable for losses due to  unauthorized  or fraudulent  instructions if we did not follow such
procedures.

American Skandia does not guarantee access to telephonic,  facsimile,  Internet or any other electronic  information or that we will
be able to accept  transaction  instructions  via such means at all times.  Regular  and/or  express  mail will be the only means by
which we will accept  transaction  instructions when telephonic,  facsimile,  Internet or any other electronic means are unavailable
or delayed.  American  Skandia  reserves the right to limit,  restrict or  terminate  telephonic,  facsimile,  Internet or any other
electronic transaction privileges at any time.

INDEMNIFICATION
Insofar as  indemnification  for  liabilities  arising under the Securities Act of 1933 (the  "Securities  Act") may be permitted to
directors,  officers or persons  controlling the registrant pursuant to the foregoing  provisions,  the registrant has been informed
that in the opinion of the SEC such  indemnification  is against  public policy as expressed in the  Securities Act and is therefore
unenforceable.

LEGAL PROCEEDINGS
As of the date of this  Prospectus,  American  Skandia and its affiliates are not involved in any legal  proceedings  outside of the
ordinary course of business.  American  Skandia and its affiliates are involved in pending and threatened  legal  proceedings in the
normal course of its business,  however,  we do not anticipate that the outcome of any such legal  proceedings  will have a material
adverse  affect on the  Separate  Account,  or American  Skandia's  ability to meet its  obligations  under the  Annuity,  or on the
distribution of the Annuity.

CONTENTS OF THE STATEMENT OF ADDITIONAL INFORMATION
The following are the contents of the Statement of Additional Information:

General Information about American Skandia
|X|      American Skandia Life Assurance Corporation
|X|      American Skandia Life Assurance Corporation Variable Account B
|X|      American Skandia Life Assurance Corporation Separate Account D

Principal Underwriter/Distributor - American Skandia Marketing, Incorporated

How Performance Data is Calculated
|X|      Current and Effective Yield
|X|      Total Return

How the Unit Price is Determined

Additional Information on Fixed Allocations
|X|      How We Calculate the Market Value Adjustment

General Information
|X|      Voting Rights
|X|      Modification
|X|      Deferral of Transactions
|X|      Misstatement of Age or Sex
|X|      Ending the Offer

Annuitization

Independent Auditors

Legal Experts

Financial Statements
|X|      Appendix A - American Skandia Life Assurance Corporation Variable Account B






                                     APPENDIX A - FINANCIAL INFORMATION ABOUT AMERICAN SKANDIA








SELECTED FINANCIAL DATA (dollars in thousands)

The following table summarizes information with respect to the operations of the Company:

                                                       For the Year Ended December 31,
                                      2002            2001            2000           1999           1998
STATEMENTS OF INCOME DATA
Revenues:
Annuity and life insurance       $    370,004     $    388,696   $    424,578    $    289,989   $    186,211
   charges and fees (a) (b)
Fee income (b)                         97,650          111,196        130,610          83,243         50,839
Net investment income                  19,632           20,126         18,595          11,477         11,130
Net realized capital (losses)
   gains and other revenues (e)        (7,438)           2,698          4,195           3,688          1,360

Total revenues                   $    479,848     $    522,716   $    577,978    $    388,397   $    249,540

Benefits and Expenses:
Annuity and life insurance       $      3,391     $      1,955   $        751    $        612   $        558
benefits
Change in annuity and life
   insurance policy reserves            2,741          (39,898)        49,339            (671)         1,053
   (c)
Guaranteed minimum death
   benefit claims, net of              23,256           20,370          2,618           4,785              -
   hedge (b)
Return credited to contract             5,196            5,796          8,463          (1,639)        (8,930)
owners
Underwriting, acquisition and
   other insurance expenses           188,728          196,755        150,597         125,434         86,306
Amortization of deferred
   acquisition costs (b) (d)          510,059          224,047        184,616          83,861         86,628
Interest expense                       14,544           73,424         85,998          69,502         41,004

Total benefits and expenses      $    747,915     $    482,449   $    482,382    $    281,884   $    206,619

Income tax (benefit) expense     $   (102,810)    $      7,168   $     30,779    $     30,344   $      8,154

Net (loss) income                $   (165,257)    $     33,099   $     64,817    $     76,169   $     34,767

STATEMENTS OF FINANCIAL
CONDITION DATA
Total assets (b)                 $ 23,708,585     $ 28,009,782   $ 31,702,705    $ 30,881,579   $ 18,848,273

Future fees payable to parent    $    708,249     $    799,472   $    934,410    $    576,034   $    368,978

Surplus notes                    $    110,000     $    144,000   $    159,000    $    179,000   $    193,000

Shareholder's equity             $    683,061     $    577,668   $    496,911    $    359,434   $    250,417

a.       On annuity and life insurance sales of $3,472,044, $3,834,167, $8,216,167, $6,862,968, and $4,159,662, during the years
     ended December 31, 2002, 2001, 2000, 1999, and 1998, respectively, with contract owner assets under management of $21,894,636,
     $26,017,847, $29,751,822, $29,396,693, and $17,854,761, as of December 31, 2002, 2001, 2000, 1999, and 1998, respectively.
b.       These items are significantly impacted by equity market volatility.
c.       For the year ended December 31, 2000, change in annuity and life insurance policy reserves reflected increases to those
     reserves for guaranteed minimum death benefit ("GMDB") exposure.  For the year ended December 31, 2001, the Company changed
     certain of its assumptions related to its GMDB exposure resulting in a benefit to operations.  See Results of Operations in
     Management's Discussion and Analysis of Financial Condition and Results of Operations ("MD&A") for a further discussion.
d.       During the year ended December 31, 2002, the Company recorded an acceleration of amortization of $206,000 against the
     deferred acquisition cost asset.  See the MD&A for a further discussion.
e.       Net realized capital (losses) gains and other revenues include $5,845 of net realized capital losses on sales of
     securities during 2002 and an other than temporary impairment charge of $3,769 recorded during 2002 on the Company's equity
     securities.

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (dollars in thousands)

Management's  Discussion  and Analysis of Financial  Condition  and Results of  Operations  should be read in  conjunction  with the
consolidated financial statements and the notes thereto and Item 6, Selected Financial Data.

 Results of Operations

Annuity and life insurance sales were  $3,472,044,  $3,834,167 and $8,216,167,  in 2002, 2001 and 2000,  respectively.  The decrease
in sales in 2002 and 2001 was  primarily  the result of the general  decline in sales in the  industry,  attributed in large part to
the continued  uncertainty in the equity markets. In addition,  the Company believes uncertainty  regarding its future ownership has
adversely  impacted  sales,  primarily  in the latter  part of 2002.  The  Company  announced,  in the first  quarter  of 2002,  its
intention to focus on the growth of its core variable annuity business.

Average assets under management totaled  $23,637,559 in 2002,  $26,792,877 in 2001 and $31,581,902 in 2000,  representing a decrease
of 12% and 15% in 2002 and 2001,  respectively,  due primarily to weak equity  markets.  The decrease in annuity and life  insurance
charges and fees and fee income before  surrender  charge income and  reinsurance  was  consistent  with the decline in assets under
management.  Surrender  charge income  increased in 2002 as compared to 2001.  This was caused by higher lapses when compared to the
applicable  prior year periods,  and was primarily  attributable,  the Company  believes,  to concerns by contract  holders,  rating
agencies and the Company's  distribution  channels,  surrounding  the  uncertainty  in the equity markets and its impact on variable
annuity  companies  generally and, prior to the  announcement of the Acquisition,  uncertainty  concerning the Company's future (See
Liquidity and Capital Resources for rating agency actions).

Net realized  capital losses in 2002 were primarily  from $9,593 of losses on sales and $3,769 of  other-than-temporary  impairments
of mutual fund  investments  that are held in support of a deferred  compensation  program for certain of the  Company's  employees.
The deferred  compensation  program losses were offset by net gains of $3,746 during 2002 on sales of fixed maturities.  Included in
those net gains on sales of fixed maturities for 2002, was a realized loss of approximately  $1,236 on the sale of a WorldCom,  Inc.
bond. The net capital gains in 2001 related  primarily to sales of fixed maturity  investments,  were partially  offset by losses on
securities in the fixed  maturity  portfolio.  The most  significant  loss was $2,636 related to Enron  securities.  In addition net
realized  capital  losses  of $3,534 in 2001  were  incurred  due to sales of mutual  fund  holdings  in  support  of the  Company's
non-qualified deferred compensation program.

The change in annuity and life insurance policy reserves  includes  changes in reserves related to annuity  contracts with mortality
risks.  During 2001, the Company's  Guaranteed Minimum Death Benefit ("GMDB") reserve decreased $43,984,  as the result of an update
of certain  reserve  assumptions as to risks inherent in the benefit.  Previous  assumptions  had been based on statutory  valuation
principles as an approximation  for U.S. GAAP. In addition,  future  mortality rates were lowered in 2001 to reflect  favorable past
experience.  However,  offsetting  the  resulting  increase in earnings  and equity as a result of changes in the GMDB  liability in
2001,  assumptions  related to GMDB claim  costs were also  updated in the  calculation  of the  deferred  acquisition  cost  asset,
resulting in additional amortization of this asset.

The Company uses  derivative  instruments,  which  consist of equity  option  contracts for risk  management  purposes,  and not for
trading or  speculation.  The Company hedges the economic GMDB exposure  associated  with equity market  fluctuations.  GMDB claims,
net of hedge,  consist of GMDB claims offset by the mark to market and realized  capital  gain/loss  results of the Company's option
contracts.  During 2002 and 2001,  the  fluctuations  in GMDB  claims,  net of hedge,  were  driven by an increase in hedge  related
benefits of $19,776 and  $14,646,  respectively.  Hedge  related  benefits  were  partially  offset by  increases  in GMDB claims of
$22,662 and $32,398 during 2002 and 2001, respectively.

Return credited to contract owners consists  primarily of net investment  results from the Company's  fixed,  market value adjusted,
separate account  investment  option and changes in the Company's  experience rated  reinsurance  receivables.  The decrease in 2002
was primarily due to increased net investment  results on the Company's fixed,  market value adjusted,  separate account  investment
option.  As the equity markets decline,  movement from variable  investment  options to fixed investment  options,  primarily due to
one of the  Company's  product  features,  has  increased  the assets  invested in the fixed  separate  account  investment  option.
Included in 2002 net investment results is $9,849 of realized and unrealized losses on certain  securities,  of which $5,427 related
to  WorldCom,  Inc.  bonds.  The  increase  in net  investment  results  was  partially  offset by a decrease  in  experience  rated
reinsurance  receivables  in 2002 due to unfavorable  experience on certain blocks of variable  annuity  business.  In 2001,  return
credited to contract  owners  decreased  primarily  due to favorable  experience  on certain  blocks of variable  annuity  contracts
increasing the experience rated reinsurance  receivable.  Partially  offsetting the 2001 decrease is net investment losses of $1,662
related to Enron securities.

Underwriting, acquisition and other insurance expenses for 2002, 2001 and 2000 were as follows:

                                                        2002              2001               2000
Commissions and purchase credits                         $   287,612       $   248,187         $   430,743
General operating expenses                                   145,438           157,704             214,957
Acquisition costs deferred                                  (244,322)         (209,136)           (495,103)
Underwriting,   acquisition   and   other   insurance
     expenses                                            $   188,728       $   196,755         $   150,597

New products  launched,  as well as a larger  proportion of sales of products with higher  commissions as compared to 2001 led to an
increase in  commissions  and purchase  credits  during  2002.  Lower sales and asset  levels led to a decrease in  commissions  and
purchase credits during 2001.  Partially  offsetting this decline in 2001, the company launched a commission  promotion program that
increased  commissions  as a percentage of new sales.  Commission  promotions in 2002 were  approximately  equivalent as compared to
2001.

General  operating  expenses  decreased  during  2002 and 2001 as a result of lower  sales-based  compensation,  as well as  expense
reduction  programs  implemented during 2001 and continued strong expense  management in 2002.  Variable  compensation and long-term
incentive plan expenses have decreased due to the slowdown in sales and the decline in the equity markets.

Amortization  of deferred  acquisition  costs  increased over the past two years, in general,  due to the further  depressed  equity
markets in 2002 and 2001,  thereby  decreasing  expectations  of future gross profits and actual gross profits from asset based fees
and  increased  expected and actual claim costs  associated  with minimum death benefit  guarantees.  During 2002,  the Company also
performed a  recoverability  study and an analysis of its  short-term  assumptions  of future  gross  profits and  determined  those
assumptions  of future  profits  to be  excessive.  This  analysis  resulted  in a current  year  acceleration  of  amortization  of
$206,000.  During 2002 and 2001,  the Company  also updated its future  estimated  gross  profits with respect to certain  mortality
assumptions  reflecting  actual  experience and the decline in the equity markets  resulting in additional  increased  amortization.
See Note 2 of Notes to Consolidated Financial Statements for a further discussion on amortization of deferred acquisition costs.

Interest  expense  decreased during 2002 primarily due to lower interest expense related to the future fees payable to ASI liability
(See Note 8). Interest  expense on these  obligations is driven by the cash flows from the underlying  annuity  contracts  acting as
collateral.  Due to the depressed  asset values of those annuity  contracts  driven by the decline in the equity  markets,  the cash
flows, and therefore the interest  expense,  decreased from prior year levels.  Interest expense  decreased in 2001 as a result of a
reduction in borrowing.

The Company's  income tax  (benefit)  expense  varies  directly with  increases or decreases in (loss) income from  operations.  The
effective income tax rate varied from the corporate rate of 35% due primarily to the deduction for dividends received.

Total assets and  liabilities  decreased  $4,301,197 and  $4,406,590,  respectively,  from December 31, 2001.  This change  resulted
primarily from the declining equity markets.

 Significant Accounting Policies

 Deferred Acquisition Costs

The costs of acquiring  new business,  which vary with and are primarily  related to new business  generated,  are deferred,  net of
reinsurance.  These costs include  commissions,  purchase  credits,  costs of contract  issuance,  and certain selling expenses that
vary with production.

The Company uses the  retrospective  deposit  method for  amortizing  deferred  acquisition  costs.  This method results in deferred
acquisition  costs being  amortized in proportion to expected gross profits from surrender  charges and policy and asset based fees,
net of  operating  and claim  costs.  The  deferred  acquisition  cost asset is  adjusted  retrospectively  and  prospectively  when
estimates  of current and future  gross  profits to be realized  from a group of  products  are  revised.  Critical  assumptions  in
estimating  gross profits  include those for  surrenders,  long-term fund growth rate,  expenses and death  benefits.  The long-term
fund growth rate, in large part,  determines  the estimated  future asset levels on which the most  significant  revenues are based.
The Company's  long-term fund growth rate assumption is 8% (net of charges assessed  against the underlying  mutual fund, but before
charges assessed at the separate  account and contract  level).  When current period actual asset growth is greater or less than the
Company's  long-term  expectation,  the Company adjusts the short-term asset growth rate to a level that will allow the Company,  in
the short-term,  to resume the long-term asset growth rate  expectation.  The short-term asset growth rate is subject to constraints
surrounding  actual market  conditions.  If the Company's  long-term fund growth rate assumption was 7% instead of 8%, the Company's
deferred acquisition cost asset at December 31, 2002 would be reduced by $26,273.

 Future Fees Payable to ASI

In a series of  transactions  with ASI,  the Company  transferred  certain  rights to receive a portion of future fees and  contract
charges expected to be realized on designated blocks of deferred annuity contracts.

The proceeds  from the  transfers  have been recorded as a liability and are being  amortized  over the remaining  surrender  charge
period of the  designated  contracts  using the interest  method.  The Company did not transfer the right to receive future fees and
charges after the expiration of the surrender charge period.

In connection with these  transactions,  ASI, through special purpose trusts,  issued  collateralized  notes in private  placements,
which are secured by the rights to receive future fees and charges purchased from the Company.

Under the terms of the securitization  purchase  agreements,  the rights  transferred  provide for ASI to receive a percentage (60%,
80% or 100% depending on the underlying  commission  option) of future  mortality and expense charges and contingent  deferred sales
charges,  after  reinsurance,  expected to be realized  over the  remaining  surrender  charge  period of the  designated  contracts
(generally  6 to 8 years).  The  liability  for future fees payable to ASI at the balance  sheet date is based on the  consideration
received less principal  repayments  according to amortization  schedules that were developed at the inception of the  transactions.
If actual  mortality  and expense  charges and  contingent  deferred  sales  charges are less than those  projected  in the original
amortization  schedules,  calculated on a transaction  by transaction  basis,  ASI has no recourse  against the Company.  As account
values  associated  with the  designated  contracts  have  declined,  consistent  with the  overall  decline in the equity  markets,
historical  mortality  and  expense  charges  have been lower than  expected  on certain  transactions  and it is likely that future
mortality and expense  charges,  on those same  transactions,  will be lower than originally  projected.  As a result,  the ultimate
cash flows  associated  with these  transactions  that will  transfer  to ASI may be lower than the current  carrying  amount of the
liability.

The Company has determined,  using  assumptions for lapses,  mortality,  free  withdrawals and a long-term fund growth rate of 8% on
the Company's assets under management, that the present value of future payments to ASI would be $429,773.

 Deferred Taxes

The Company  evaluates the necessity of recording a valuation  allowance against its deferred tax asset in accordance with Statement
of Financial  Accounting  Standards No. 109,  Income Taxes ("SFAS 109"). In performing this  evaluation,  the Company  considers all
available  evidence  in making  the  determination  as to  whether  it is more  likely  than not that  deferred  tax  assets are not
realizable.  For the Company,  that evidence  includes:  cumulative  U.S. GAAP pre-tax  income in recent years past,  whether or not
operating  losses have expired  unused in the past,  the length of  remaining  carryback or  carryforward  periods,  and net taxable
income or loss  expectations  in early future years.  The net taxable  income or loss  projections  are based on profit  assumptions
consistent with those used to amortize deferred acquisition costs (see above discussion on deferred acquisition costs).

As of December 31, 2002, the Company has  approximately  $361,000  gross  deferred tax assets  related  principally to net operating
loss  carryforwards  that  expire  in 2016 and 2017 and  insurance  reserve  differences.  After  considering  the  impact  of gross
reversing  temporary  liabilities of $323,000,  the Company  estimates that the Company will generate  sufficient  taxable income to
fully utilize gross deferred tax assets within 2 years (prior to the expiration of the net operating losses).

 Liquidity and Capital Resources

The Company's liquidity requirements have generally been met by cash from insurance operations,  investment  activities,  borrowings
from ASI, reinsurance, capital contributions and securitization transactions with ASI (see Note 8).

The  Company's  cash from  insurance  operations  is primarily  comprised of fees  generated  off of assets under  management,  less
commission  expense on sales,  sales and marketing  expenses and other operating  expenses.  Fund  performance  driven by the equity
markets  directly impact assets under management and therefore,  the fees the Company can generate off of those assets.  During 2002
and 2001, assets under management  declined  consistent with the equity market declines resulting in reductions in fee revenues.  In
addition,  the  equity  markets  impact  sales  of  variable  annuities.  As sales  have  declined  in a  declining  equity  market,
non-promotional  commission  expense  declined,  however,  in order to boost sales  levels,  the Company has offered  various  sales
promotions increasing the use of cash for commission expense.

In order to fund the cash strain  generated from  acquisition  costs on current sales, the Company has relied on cash generated from
its direct insurance  operations as well as reinsurance and securitization  transactions.  The Company has used modified coinsurance
reinsurance  arrangements  whereby the  reinsurer  shares in the  experience  of a specified  book of  business.  These  reinsurance
transactions  result in the Company  receiving  from the reinsurer an upfront  ceding  commission  on the book of business  ceded in
exchange for the reinsurer  receiving , the future fees  generated from that book of business.  These  reinsurance  agreements  also
mitigate the recoverability  risk associated with the payment of up-front  commissions and other acquisition costs.  Similarly,  the
Company has entered into securitization  transactions  whereby the Company issues to ASI, in exchange for cash, the right to receive
future fees  generated  off of a specific  book of  business.  On April 12,  2002,  the Company  entered  into a new  securitization
transaction  with ASI. This  transaction  covers  designated  blocks of business  issued from November 1, 2000 through  December 31,
2001.  The  estimated  present  value of the  transaction  at April 12,  2002,  using a discount  rate of 6.00%,  was  approximately
$101,713.

As of December 31, 2002, 2001 and 2000, the Company had short-term  borrowings of $10,000,  $10,000 and $10,000,  respectively,  and
had  long-term  surplus notes  liabilities  of $110,000,  $144,000 and $159,000,  respectively.  During 2002,  the Company  borrowed
$263,091 and paid back $263,091  related to short-term  borrowing.  During 2002 and 2001, the Company  received  permission from the
State of Connecticut  Insurance Department to pay down surplus notes in the amount of $34,000 and $15,000,  respectively.  See Notes
14 and 15 of Notes  to  Consolidated  Financial  Statements  for  more  information  on  surplus  notes  and  short-term  borrowing,
respectively.

As of December 31, 2002, 2001 and 2000,  shareholder's  equity totaled $683,061,  $577,668 and $496,911,  respectively.  The Company
received capital  contributions  of $259,720 and $48,000 from ASI during 2002 and 2001,  respectively.  Of this,  $4,520 and $2,500,
respectively,  was used to support its  investment in Skandia  Vida.  Net (loss)  income of  ($165,257)  and $33,099,  for the years
ended December 31, 2002 and 2001, respectively, contributed to the respective changes in shareholder's equity in 2002 and 2001.

The National Association of Insurance  Commissioners  ("NAIC") requires insurance companies to report information  regarding minimum
Risk Based Capital ("RBC")  requirements.  These requirements are intended to allow insurance  regulators to identify companies that
may need regulatory  attention.  The RBC model law requires that insurance  companies  apply various  factors to asset,  premium and
reserve items,  all of which have inherent risks.  The formula  includes  components for asset risk,  insurance risk,  interest rate
risk and business risk.  The Company has complied with the NAIC's RBC reporting  requirements  and has total  adjusted  capital well
above required capital.

During 2002,  all of the major rating  agencies  reviewed the U.S. life  insurance  sector,  including  the Company.  Based on these
reviews the rating  agencies  have  evolving  concerns  surrounding  the risk  profile of variable  annuity  companies  due to their
significant  exposure  to equity  market  performance.  This  exposure  has  resulted,  and may  continue  to  result,  in  earnings
volatility.  Based on the reviews made during 2002, the following ratings actions took place:

On May 8,  2002,  Fitch  Ratings  downgraded  the  Company's  "insurer  financial  strength"  rating to A+ from AA- with a  "stable"
outlook.

On September 19, 2002,  Fitch Ratings lowered the Company's  "insurer  financial  strength"  rating to A- from A+ with an "evolving"
outlook.

On September 27, 2002, A.M. Best Co. lowered the Company's "financial strength" rating to A- from A with negative implications.

On October 16, 2002,  Standard and Poor's lowered the Company's  "counter party credit" and "financial  strength" ratings to A- from
A+ with a negative outlook and removed the Company from Credit Watch.

Subsequent  to the  announcement  of the  Acquisition,  Standard  and  Poor's  placed  the  Company  on  CreditWatch  with  positive
implications.

 Effects of Inflation

The rate of inflation has not had a significant effect on the Company's financial statements.

Outlook

The Company believes that it is well positioned to retain and enhance its position as a leading  provider of financial  products for
long-term  savings and retirement  purposes as well as to address the economic impact of premature death,  estate planning  concerns
and supplemental  retirement  needs. The Company has renewed its focus on its core variable annuity  business,  offering  innovative
long-term  savings and income products,  strengthening its wholesaling  efforts and providing  consistently good customer service in
order to gain market share and improve profitability in an increasingly competitive market.

The  Gramm-Leach-Bliley  Act of 1999 (the Financial Services  Modernization Act) permits  affiliation among banks,  securities firms
and insurance  companies.  This legislative change has created  opportunities for continued  consolidation in the financial services
industry and increased competition as large companies offer a wide array of financial products and services.

Various  other  legislative  initiatives  could impact the Company such as pension  reform and capital gains and estate tax changes.
These  include the  proposed  exclusion  from tax for  corporate  dividends,  potential  changes to the  deductibility  of dividends
received from the Company's  separate accounts and newly proposed  tax-advantaged  savings programs.  Additional  pension reform may
change current tax deferral rules and allow increased  contributions to retirement  plans,  which may lead to higher  investments in
tax-deferred  products and create  growth  opportunities  for the Company.  A capital  gains tax  reduction  may cause  tax-deferred
products to be less attractive to consumers, which could adversely impact the Company.

In addition,  NAIC  statutory  reserving  guidelines  and/or  interpretations  of those  guidelines  may change in the future.  Such
changes may require the Company to modify, perhaps materially, its statutory-based reserves for variable annuity contracts.

 Forward Looking Information

The Private Securities  Litigation Reform Act of 1995 (the "1995 Act") provides a "safe harbor" for forward-looking  statements,  so
long as those statements are identified as forward-looking,  and the statements are accompanied by meaningful  cautionary statements
that identify  important  factors that could cause actual results to differ  materially  from those  discussed in the statement.  We
want to take advantage of these safe harbor provisions.

Certain  information  contained in the  Management's  Discussion  and Analysis of Financial  Condition  and Results of Operations is
forward-looking within the meaning of the 1995 Act or Securities and Exchange Commission rules.


These  forward-looking  statements  rely on a number  of  assumptions  concerning  future  events,  and are  subject  to a number of
significant  uncertainties  and results may differ  materially  from these  statements.  You should not put undue  reliance on these
forward-looking  statements.  We disclaim any intention or obligation to update or revise forward-looking  statements,  whether as a
result of new information, future events or otherwise.


 QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The Company is subject to potential  fluctuations in earnings and the fair value of certain of its assets and  liabilities,  as well
as variations in expected cash flows due to changes in market  interest rates and equity prices.  The following  discussion  focuses
on specific  exposures the Company has to interest rate and equity price risk and describes  strategies  used to manage these risks,
and includes  "forward-looking  statements" that involve risk and uncertainties.  The discussion is limited to financial instruments
subject to market risks and is not intended to be a complete discussion of all of the risks to which the Company is exposed.

 Interest Rate Risk

Fluctuations  in interest rates can  potentially  impact the Company's  profitability  and cash flows.  At December 31, 2002, 91% of
assets held under  management  by the Company are in  non-guaranteed  Separate  Accounts for which the  Company's  interest rate and
equity  market  exposure is not  significant,  as the contract  owner  assumes  substantially  all of the  investment  risk.  Of the
remaining  9% of  assets,  the  interest  rate risk from  contracts  that  carry  interest  rate  exposure  is  managed  through  an
asset/liability matching program which takes into account the risk variables of the insurance liabilities supported by the assets.

At December 31, 2002, the Company held fixed maturity  investments in its general  account that are sensitive to changes in interest
rates. These securities are held in support of the Company's fixed immediate  annuities,  fixed supplementary  contracts,  the fixed
investment option offered in its variable life insurance  contracts,  and in support of the Company's target solvency  capital.  The
Company has a conservative  investment  philosophy with regard to these investments.  All investments are investment grade corporate
securities, government agency or U.S. government securities.

The Company's  deferred  annuity  products  offer a fixed  investment  option which  subjects the Company to interest rate risk. The
fixed option  guarantees a fixed rate of interest for a period of time  selected by the contract  owner.  Guarantee  period  options
available range from one to ten years.  Withdrawal of funds,  or transfer of funds to variable  investment  options,  before the end
of the guarantee  period subjects the contract owner to a market value  adjustment  ("MVA").  In the event of rising interest rates,
which make the fixed  maturity  securities  underlying  the  guarantee  less  valuable,  the MVA could be negative.  In the event of
declining  interest  rates,  which make the fixed maturity  securities  underlying  the guarantee  more  valuable,  the MVA could be
positive.  The resulting  increase or decrease in the value of the fixed option,  from calculation of the MVA, should  substantially
offset the increase or decrease in the market  value of the  securities  underlying  the  guarantee.  The Company  maintains  strict
asset/liability  matching  to  enable  this  offset.  However,  the  Company  still  takes on the  default  risk for the  underlying
securities,  the interest rate risk of  reinvestment  of interest  payments and the risk of failing to maintain the  asset/liability
matching program with respect to duration and convexity.

Liabilities held in the Company's  guaranteed separate account as of December 31, 2002 totaled $1,828,048.  Assets,  primarily fixed
income  investments,  supporting those liabilities had a fair value of $1,828,048.  The Company performed a sensitivity  analysis on
these  interest-sensitive  liabilities and assets at December 31, 2002. The analysis showed that an immediate  decrease of 100 basis
points in interest rates would result in a net increase in liabilities and the  corresponding  assets of  approximately  $69,150 and
$68,500,  respectively.  An analysis of a 100 basis point decline in interest  rates at December 31, 2001,  showed a net increase in
interest-sensitive liabilities and the corresponding assets of approximately $39,800 and $39,900, respectively.

 Equity Market Exposure

The primary  equity market risk to the Company comes from the nature of the variable  annuity and variable life products sold by the
Company.  Various  fees and  charges  earned  are  substantially  derived  as a  percentage  of the  market  value of  assets  under
management.  In a market decline,  this income will be reduced.  This could be further  compounded by customer  withdrawals,  net of
applicable  surrender  charge  revenues,  partially  offset by transfers to the fixed option  discussed  above. A 10% decline in the
market value of the assets under  management at December 31, 2002,  sustained  throughout  2003, would result in an approximate drop
in related mortality and expense charges and annual fee income of $36,350.

Another  equity  market risk  exposure of the Company  relates to guaranteed  minimum  death  benefit  payments.  Declines in equity
markets and,  correspondingly,  the  performance of the funds  underlying the Company's  products,  increase  exposure to guaranteed
minimum death benefit  payments.  As discussed in Note 2D of the  consolidated  financial  statements,  the Company uses  derivative
instruments to hedge against the risk of  significant  decreases in equity  markets.  Prior to the  implementation  of this program,
the Company used reinsurance to mitigate this risk.

The Company has a portfolio of equity investments  consisting of mutual funds, which are held in support of a deferred  compensation
program.  In the event of a decline in market values of underlying  securities,  the value of the portfolio  would decline;  however
the accrued benefits payable under the related deferred compensation program would decline by a corresponding amount.

Estimates of interest rate risk and equity price risk were  obtained  using  computer  models that take into  consideration  various
assumptions  about the future.  Given the  uncertainty  of future  interest rate  movements,  volatility  in the equity  markets and
consumer behavior, actual results may vary from those predicted by the Company's models.



                                            AUDITED CONSOLIDATED FINANCIAL STATEMENTS OF
                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION





                                                   Report of Independent Auditors

To the Board of Directors and Shareholder of
    American Skandia Life Assurance Corporation
Shelton, Connecticut

We have audited the consolidated  statements of financial  condition of American  Skandia Life Assurance  Corporation (the "Company"
which is an indirect  wholly-owned  subsidiary of Skandia  Insurance Company Ltd.) as of December 31, 2002 and 2001, and the related
consolidated  statements  of income,  shareholder's  equity and cash flows for each of the three years in the period ended  December
31, 2002. These  consolidated  financial  statements are the  responsibility of the Company's  management.  Our responsibility is to
express an opinion on these consolidated financial statements based on our audits.

We conducted our audits 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 audits provide a reasonable basis for our opinion.

In our opinion,  the financial  statements  referred to above present fairly, in all material respects,  the consolidated  financial
position of American  Skandia Life  Assurance  Corporation  at December  31, 2002 and 2001,  and the  consolidated  results of their
operations  and their cash flows for each of the three years in the period ended  December 31, 2002, in conformity  with  accounting
principles generally accepted in the United States.

As discussed in Note 2, in 2002 the Company adopted Statement of Financial Accounting Standards No. 142, Goodwill and Other
Intangible Assets.

As discussed in Note 2, effective January 1, 2001, the Company adopted Statement of Financial Accounting Standards No. 133,
Accounting for Derivative Instruments and Hedging Activities.


/s/ Ernst & Young LLP

Hartford, Connecticut
February 3, 2003


                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                              (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                           Consolidated Statements of Financial Condition
                                                 (in thousands, except share data)

                                                                           As of December 31,
                                                                          2002            2001
ASSETS
Investments:
   Fixed maturities - at fair value (amortized cost of $379,422
     and $356,882, respectively)                                     $       398,601 $       362,831
   Equity securities - at fair value (amortized cost of $52,017
     and $49,886, respectively)                                               51,769          45,083
   Derivative instruments - at fair value                                     10,370           5,525
   Policy loans                                                                7,559           6,559

     Total investments                                                       468,299         419,998

Cash and cash equivalents                                                     51,339               -
Accrued investment income                                                      4,196           4,737
Deferred acquisition costs                                                 1,117,544       1,383,281
Reinsurance receivable                                                         5,447           7,733
Receivable from affiliates                                                     3,961           3,283
Income tax receivable                                                              -          30,537
Deferred income taxes                                                         38,206               -
Fixed assets, at depreciated cost (accumulated depreciation of
$7,555 and $4,266, respectively)                                              12,132          17,752
Other assets                                                                 101,848         103,912
Separate account assets                                                   21,905,613      26,038,549

     Total assets                                                    $    23,708,585 $    28,009,782

LIABILITIES AND SHAREHOLDER'S EQUITY
Liabilities:
Reserves for future policy and contract benefits                     $       149,349 $        91,126
Accounts payable and accrued expenses                                        133,543         192,952
Income tax payable                                                             6,547               -
Deferred income taxes                                                              -          54,980
Payable to affiliates                                                          2,223         101,035
Future fees payable to American Skandia, Inc. ("ASI")                        708,249         799,472
Short-term borrowing                                                          10,000          10,000
Surplus notes                                                                110,000         144,000
Separate account liabilities                                              21,905,613      26,038,549

     Total liabilities                                                    23,025,524      27,432,114

Commitments and contingent liabilities (Note 18)

Shareholder's equity:
Common stock, $100 par value, 25,000 shares authorized,
   issued and outstanding                                                      2,500           2,500
Additional paid-in capital                                                   595,049         335,329
Retained earnings                                                             73,821         239,078
Accumulated other comprehensive income                                        11,691             761

     Total shareholder's equity                                              683,061         577,668

     Total liabilities and shareholder's equity                      $    23,708,585 $    28,009,782

                                          See notes to consolidated financial statements.
                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                              (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                                 Consolidated Statements of Income
                                                           (in thousands)

                                                                       For the Years Ended December 31,
                                                                      2002          2001           2000

REVENUES

Annuity and life insurance charges and fees                       $    370,004  $    388,696  $    424,578
Fee income                                                              97,650       111,196       130,610
Net investment income                                                   19,632        20,126        18,595
Net realized capital (losses) gains                                     (9,614)          928          (688)
Other                                                                    2,176         1,770         4,883

   Total revenues                                                      479,848       522,716       577,978


EXPENSES

Benefits:
   Annuity and life insurance benefits                                   3,391         1,955           751
   Change in annuity and life insurance policy reserves                  2,741       (39,898)       49,339
   Guaranteed minimum death benefit claims, net of hedge                23,256        20,370         2,618
   Return credited to contract owners                                    5,196         5,796         8,463

     Total benefits                                                     34,584       (11,777)       61,171

Other:
   Underwriting, acquisition and other insurance
     expenses                                                          188,728       196,755       150,597
   Amortization of deferred acquisition costs                          510,059       224,047       184,616
   Interest expense                                                     14,544        73,424        85,998

                                                                       713,331       494,226       421,211

   Total benefits and expenses                                         747,915       482,449       482,382

     (Loss) income from operations before income tax
(benefit) expense                                                     (268,067)       40,267        95,596

       Income tax (benefit) expense                                   (102,810)        7,168        30,779

         Net (loss) income                                        $   (165,257) $     33,099  $     64,817


                                          See notes to consolidated financial statements.

                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                              (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                          Consolidated Statements of Shareholder's Equity
                                                           (in thousands)

                                                                                    Accumulated Other
                                                                                  Comprehensive Income
                                                                               ----------------------------
                                                                               -------------- -------------
                                                      Additional                  Foreign      Unrealized
                                          Common        Paid in    Retained      Currency        Gains
                                            Stock       Capital     Earnings    Translation     (Losses)       Total
                                          ----------- ------------ ----------- -------------- ------------- ------------
                                          ----------- ------------ ----------- -------------- ------------- ------------
 As of December 31, 1999                      $2,500     $215,879    $141,162        $148          ($255)      $359,434
Net income                                                             64,817                                    64,817
Other comprehensive income:
   Unrealized capital gains                                                                          843            843
   Reclassification adjustment for
realized losses included in net
realized capital (losses) gains                                                                      433            433
   Foreign currency translation                                                       (66)                          (66)
                                                                                                            ------------
                                                                                                            ------------
Other comprehensive income                                                                                        1,210
                                                                                                            ------------
                                                                                                            ------------
Comprehensive income                                                                                             66,027
Capital contributions                                      71,450                                                71,450
                                          ----------- ------------ ----------- -------------- ------------- ------------
                                          ----------- ------------ ----------- -------------- ------------- ------------
As of December 31, 2000                        2,500      287,329     205,979          82          1,021        496,911
Net income                                                             33,099                                    33,099
Other comprehensive loss:
   Unrealized capital losses                                                                        (261)          (261)
   Reclassification adjustment for
realized gains included in net
realized capital (losses) gains                                                                      (14)           (14)
   Foreign currency translation                                                       (67)                          (67)
                                                                                                            ------------
                                                                                                            ------------
Other comprehensive loss                                                                                           (342)
                                                                                                            ------------
                                                                                                            ------------
Comprehensive income                                                                                             32,757
Capital contributions                                      48,000                                                48,000
                                          ----------- ------------ ----------- -------------- ------------- ------------
                                          ----------- ------------ ----------- -------------- ------------- ------------
As of December 31, 2001                        2,500      335,329     239,078          15            746        577,668
Net loss                                                             (165,257)                                 (165,257)
Other comprehensive income:
   Unrealized capital gains                                                                       10,434         10,434
   Reclassification adjustment for
realized losses included in net
realized capital (losses) gains                                                                    1,126          1,126
   Foreign currency translation                                                      (630)                         (630)
                                                                                                            ------------
                                                                                                            ------------
Other comprehensive income                                                                                       10,930
                                                                                                            ------------
                                                                                                            ------------
Comprehensive loss                                                                                             (154,327)
Capital contributions                                     259,720                                               259,720
                                          ----------- ------------ ----------- -------------- ------------- ------------
                                          ----------- ------------ ----------- -------------- ------------- ------------
As of December 31, 2002                       $2,500     $595,049     $73,821       $(615)       $12,306       $683,061

Unrealized  capital  gains  (losses)  is shown net of tax  expense  (benefit)  of $5,618,  ($140) and $454 for 2002,  2001 and 2000,
respectively.  Reclassification  adjustment for realized  losses (gains)  included in net realized  capital  (losses) gains is shown
net of tax expense  (benefit) of $606, ($8) and $233 for 2002, 2001 and 2000,  respectively.  Foreign currency  translation is shown
net of tax benefit of $339, $36 and $36 for 2002, 2001 and 2000, respectively.




                                          See notes to consolidated financial statements.

                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                              (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                               Consolidated Statements of Cash Flows
                                                           (in thousands)

                                                                         For the Years Ended December 31,
                                                                           2002        2001        2000
Cash flow from operating activities:
   Net (loss) income                                                    $ (165,257) $   33,099  $   64,817
   Adjustments to reconcile net (loss) income to net
     cash (used in) provided by operating activities:
     Amortization and depreciation                                          21,649      13,374       5,758
     Deferral of acquisition costs                                        (244,322)   (209,136)   (495,103)
     Amortization of deferred acquisition costs                            510,059     224,047     184,616
     Deferred tax (benefit) expense                                        (99,071)     46,215      60,023
     Change in unrealized (gains) losses on derivatives                     (5,149)      2,902      (2,936)
     Increase (decrease) in policy reserves                                  3,293     (38,742)     50,892
     (Decrease) increase in net receivable/payable to affiliates           (99,490)    103,496     (72,063)
     Change in net income tax receivable/payable                            37,084       4,083     (58,888)
     Increase in other assets                                               (9,546)    (12,105)    (65,119)
     Decrease (increase) in accrued investment income                          541         472      (1,155)
     Decrease (increase) in reinsurance receivable                           2,286      (1,849)        420
     (Decrease) increase in accounts payable and accrued
expenses                                                                   (59,409)     55,912     (21,550)
     Net realized capital (gains) losses on derivatives                    (26,654)    (14,929)      5,554
     Net realized capital losses (gains) on investments                      9,616        (928)        688
       Net cash (used in) provided by operating activities                (124,370)    205,911    (344,046)

Cash flow from investing activities:
     Purchase of fixed maturity investments                               (388,053)   (462,820)   (380,737)
     Proceeds from sale and maturity of fixed
       maturity investments                                                367,263     390,816     303,736
     Purchase of derivatives                                               (61,998)   (103,533)    (14,781)
     Proceeds from exercise or sale of derivative instruments               88,956     113,051       5,936
     Purchase of shares in equity securities and dividend
reinvestments                                                              (49,713)    (55,430)    (18,136)
     Proceeds from sale of shares in equity securities                      34,220      25,228       8,345
     Purchase of fixed assets                                               (2,423)    (10,773)     (7,348)
     Increase in policy loans                                               (1,000)     (2,813)     (2,476)
       Net cash used in investing activities                               (12,748)   (106,274)   (105,461)

Cash flow from financing activities:
     Capital contribution                                                  259,720      48,000      71,450
     Pay down of surplus notes                                             (34,000)    (15,000)    (20,000)
     (Decrease) increase in future fees payable to ASI, net                (91,223)   (137,355)    358,376
     Deposits to contract owner accounts                                   808,209      59,681     172,441
     Withdrawals from contract owner accounts                             (164,964)   (130,476)   (102,603)
     Change in contract owner accounts, net of investment earnings        (588,315)     62,875     (55,468)
       Net cash provided by (used in) financing activities                 189,427    (112,275)    424,196

       Net increase (decrease) in cash and cash equivalents                 52,309     (12,638)    (25,311)
       Change in foreign currency translation                                 (970)       (103)       (101)
       Cash and cash equivalents at beginning of period                          -      12,741      38,153
       Cash and cash equivalents at end of period                       $   51,339  $        -  $   12,741
     Income taxes (received) paid                                       $  (40,823) $  (43,130) $   29,644
     Interest paid                                                      $   23,967  $   56,831  $  114,394
                                          See notes to consolidated financial statements.

                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                              (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                             Notes to Consolidated Financial Statements
                                                         December 31, 2002
                                                       (dollars in thousands)

1.       ORGANIZATION AND OPERATION

         American  Skandia  Life  Assurance  Corporation  ("ASLAC"  or the  "Company"),  with  its  principal  offices  in  Shelton,
         Connecticut,  is a wholly-owned  subsidiary of American  Skandia,  Inc.  ("ASI").  On December 19, 2002,  Skandia Insurance
         Company Ltd. (publ)  ("SICL"),  an insurance  company  organized under the laws of the Kingdom of Sweden,  and the ultimate
         parent company of the Company,  entered into a definitive purchase agreement with Prudential Financial,  Inc., a New Jersey
         corporation ("Prudential  Financial"),  whereby Prudential Financial will acquire the Company and certain of its affiliates
         (the  "Acquisition").  Consummation  of the  transaction is subject to various  closing  conditions,  including  regulatory
         approvals  and  approval of certain  matters by the board of directors  and  shareholders  of the mutual  funds  advised by
         American Skandia  Investment  Services,  Inc.  ("ASISI"),  a subsidiary of ASI. The transaction is expected to close during
         the second quarter of 2003.

         The  Company  develops  long-term  savings  and  retirement   products,   which  are  distributed  through  its  affiliated
         broker/dealer  company,  American Skandia Marketing,  Incorporated  ("ASM"). The Company currently issues term and variable
         universal life insurance and variable  deferred and immediate  annuities for individuals and groups in the United States of
         America and its territories.

         The Company has 99.9%  ownership  in Skandia  Vida,  S.A.  de C.V.  ("Skandia  Vida"),  which is a life  insurance  company
         domiciled in Mexico.  Skandia Vida had total  shareholder's  equity of $5,023 and $4,179 as of December 31, 2002, and 2001,
         respectively.  Skandia Vida has generated  net losses of $2,706,  $2,619 and $2,540 in 2002,  2001 and 2000,  respectively.
         As part of the  Acquisition,  it is expected  that the Company  will sell its  ownership  interest in Skandia Vida to SICL.
         The Company has filed for required  regulatory  approvals from the State of  Connecticut  and Mexico related to the sale of
         Skandia Vida.

2.       SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

         A.       Basis of Reporting

                  The accompanying  consolidated  financial  statements have been prepared in conformity with accounting  principles
                  generally  accepted in the United States ("U.S.  GAAP").  Skandia Vida has been  consolidated  in these  financial
                  statements.  Intercompany  transactions  and balances between the Company and Skandia Vida have been eliminated in
                  consolidation.

                  Certain reclassifications have been made to prior year amounts to conform with the current year presentation.

         B.       New Accounting Standard

                  Effective January 1, 2001, the Company adopted Statement of Financial  Accounting  Standards No. 133,  "Accounting
                  for  Derivative  Instruments  and Hedging  Activities,"  as amended by SFAS 137 and SFAS 138  (collectively  "SFAS
                  133").  Derivative instruments held by the Company consist of equity put option contracts utilized to

                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                              (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                       Notes to Consolidated Financial Statements (continued)

2.       SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

                  manage  the  economic  risks  associated  with  guaranteed  minimum  death  benefits  ("GMDB").  These  derivative
                  instruments are carried at fair value.  Realized and unrealized  gains and losses are reported in the Consolidated
                  Statements  of Income,  together  with GMDB claims  expense,  as a component of  Guaranteed  Minimum Death Benefit
                  Claims,  Net of Hedge.  The  adoption of SFAS No. 133 did not have a material  effect on the  Company's  financial
                  statements.

                  Effective April 1, 2001, the Company adopted the Emerging Issues Task Force ("EITF") Issue 99-20,  "Recognition of
                  Interest Income and Impairment on Purchased and Retained  Beneficial  Interests in Securitized  Financial Assets."
                  Under the  consensus,  investors  in certain  asset-backed  securities  are  required  to record  changes in their
                  estimated  yield on a prospective  basis and to evaluate these  securities for an other than temporary  decline in
                  value.  If the fair value of the  asset-backed  security has declined below its carrying amount and the decline is
                  determined  to be other than  temporary,  the security is written  down to fair value.  The adoption of EITF Issue
                  99-20 did not have a significant effect on the Company's financial statements.

                  In July 2001,  the  Financial  Accounting  Standards  Board  ("FASB")  issued  Statement of  Financial  Accounting
                  Standards.  No. 142  "Accounting  for  Goodwill and  Intangible  Assets"  ("SFAS  142").  Under the new  standard,
                  goodwill and intangible  assets deemed to have indefinite lives will no longer be amortized but will be subject to
                  annual  impairment  tests in  accordance  with the new  standard.  Other  intangible  assets  will  continue to be
                  amortized over their useful lives.

                  The Company applied the new rules on the accounting for goodwill and other intangible  assets in the first quarter
                  of 2002.  The adoption of SFAS 142 did not have a significant impact on the Company's financial statements.

C.       Investments

                  The Company has classified its fixed maturity investments as available-for-sale  and, as such, they are carried at
                  fair value with changes in unrealized gains and losses reported as a component of other comprehensive income.

                  The Company has classified its equity securities held in support of a deferred  compensation plan (see Note 12) as
                  available-for-sale.  Such  investments  are  carried  at fair value with  changes in  unrealized  gains and losses
                  reported as a component of other comprehensive income.

                  Policy loans are carried at their unpaid principal balances.

                  Realized capital gains and losses on disposal of investments are determined by the specific identification method.

                  Other than temporary  impairment  charges are  determined  based on an analysis that is performed on a security by
                  security basis and includes quantitative and qualitative factors.

                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                              (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                       Notes to Consolidated Financial Statements (continued)

2.       SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

D.       Derivative Instruments

                  The Company  uses  derivative  instruments,  which  consist of equity put option  contracts,  for risk  management
                  purposes,  and not for trading or  speculation.  The Company  hedges the economic  GMDB exposure  associated  with
                  equity  market  fluctuations.  As the equity  markets  decline,  the  Company's  exposure  to future  GMDB  claims
                  increases.  Conversely,  as the equity markets  increase the Company's  exposure to future GMDB claims  decreases.
                  The claims exposure is reduced by the market value effect of the option contracts purchased.

                  Based on criteria  described in SFAS 133, the  Company's  fair value hedges do not qualify as  "effective"  hedges
                  and, therefore, hedge accounting may not be applied.  Accordingly,  the derivative investments are carried at fair
                  value with changes in unrealized  gains and losses being recorded in income as those changes occur.  As such, both
                  realized and  unrealized  gains and losses are reported in the  Consolidated  Statements of Income,  together with
                  GMDB claims expense, as a component of Guaranteed Minimum Death Benefit Claims, Net of Hedge.

                  As of December 31, 2002 and 2001,  the  accumulated  difference  between  cost and market  value on the  Company's
                  derivatives  was an  unrealized  gain of $1,434  and an  unrealized  loss of $3,715,  respectively.  The amount of
                  realized and unrealized gains (losses) on the Company's  derivatives  recorded during the years ended December 31,
                  2002, 2001 and 2000 was $31,803, $12,027 and ($2,619), respectively.

E.       Cash Equivalents

                  The Company  considers all highly liquid time deposits,  commercial  paper and money market mutual funds purchased
                  with a maturity date, at acquisition, of three months or less to be cash equivalents.

                  As of December 31, 2002, $50 of cash reflected on the Company's financial  statements was restricted in compliance
                  with regulatory requirements.

         F.       State Insurance Licenses

                  Licenses to do business in all states have been  capitalized  and  reflected at the purchase  price of $6,000 less
                  accumulated  amortization  of $2,038 at  December  31,  2002.  Due to the  adoption  of SFAS 142,  the cost of the
                  licenses is no longer being  amortized  but is subjected to an annual  impairment  test.  As of December 31, 2002,
                  the  Company  estimated  the fair  value of the  state  insurance  licenses  to be in excess  of book  value  and,
                  therefore, no impairment charge was required.





                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                              (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                       Notes to Consolidated Financial Statements (continued)

2.       SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

         G.       Income Taxes

                  The Company is included in the  consolidated  federal  income tax return filed by Skandia  U.S.  Inc. and its U.S.
                  subsidiaries.  In accordance  with the tax sharing  agreement,  the federal  income tax provision is computed on a
                  separate return basis as adjusted for  consolidated  items.  Pursuant to the terms of this agreement,  the Company
                  has the right to recover the value of losses utilized by the  consolidated  group in the year of  utilization.  To
                  the extent the Company  generates  income in future years,  the Company is entitled to offset future taxes on that
                  income through the application of its loss carry forward generated in the current year.

                  Deferred income taxes reflect the net tax effects of temporary  differences between the carrying amounts of assets
                  and liabilities for financial reporting purposes and the amounts used for income tax purposes.

         H.       Recognition of Revenue and Contract Benefits

                  Revenues for variable  deferred  annuity  contracts  consist of charges  against  contract owner account values or
                  separate  accounts  for  mortality  and  expense  risks,  administration  fees,  surrender  charges  and an annual
                  maintenance  fee per  contract.  Revenues  for  mortality  and expense risk  charges and  administration  fees are
                  recognized as assessed  against the contract  holder.  Surrender  charge revenue is recognized  when the surrender
                  charge is assessed  against the  contract  holder at the time of  surrender.  Annual  maintenance  fees are earned
                  ratably throughout the year.

                  Benefit  reserves for the variable  investment  options on annuity  contracts  represent  the account value of the
                  contracts and are included in the separate account liabilities.

                  Fee income from mutual fund organizations is recognized when assessed against assets under management.

                  Revenues for variable  immediate annuity and supplementary  contracts with life  contingencies  consist of certain
                  charges  against  contract owner account values  including  mortality and expense risks and  administration  fees.
                  These charges and fees are recognized as revenue as assessed  against the contract  holder.  Benefit  reserves for
                  variable  immediate  annuity  contracts  represent  the account  value of the  contracts  and are  included in the
                  separate account liabilities.

                  Revenues for the market value adjusted fixed investment  option on annuity  contracts  consist of separate account
                  investment  income reduced by amounts  credited to the contract  holder for interest.  This net spread is included
                  in return  credited to contract  owners on the  consolidated  statements  of income.  Benefit  reserves  for these
                  contracts represent the account value of the contracts plus a



                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                              (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                       Notes to Consolidated Financial Statements (continued)

2.       SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

                  market value  adjustment,  and are included in the general account reserve for future policy and contract benefits
                  to the  extent in excess of the  separate  account  assets,  typically  for the  market  value  adjustment  at the
                  reporting date.

                  Revenues for fixed immediate annuity and fixed supplementary  contracts without life contingencies  consist of net
                  investment  income,  reported as a component of return credited to contract  owners.  Revenues for fixed immediate
                  annuity contracts with life contingencies consist of single premium payments recognized as annuity  considerations
                  when  received.  Benefit  reserves for these  contracts are based on applicable  actuarial  standards with assumed
                  interest  rates that vary by issue year and are  included in the  general  account  reserve for future  policy and
                  contract benefits.  Assumed interest rates ranged from 6.25% to 8.25% at December 31, 2002 and 2001.

                  Revenues for variable life  insurance  contracts  consist of charges  against  contract  owner  account  values or
                  separate  accounts for mortality and expense risk fees,  administration  fees, cost of insurance  fees,  taxes and
                  surrender  charges.  Certain  contracts also include charges  against  premium to pay state premium taxes.  All of
                  these charges are recognized as revenue when assessed against the contract  holder.  Benefit reserves for variable
                  life  insurance  contracts  represent the account value of the contracts and are included in the separate  account
                  liabilities.

         I.       Deferred Acquisition Costs

                  The costs of acquiring new  business,  which vary with and are primarily  related to new business  generated,  are
                  being  deferred,  net of  reinsurance.  These  costs  include  commissions,  purchase  credits,  costs of contract
                  issuance, and certain selling expenses that vary with production.

                  The Company uses the retrospective  deposit method for amortizing deferred  acquisition costs. This method results
                  in deferred acquisition costs being amortized in proportion to expected gross profits,  from surrender charges and
                  policy and asset based fees,  net of operating and claim costs.  The deferred  acquisition  cost asset is adjusted
                  retrospectively  and prospectively  when estimates of current and future gross profits to be realized from a group
                  of products  are  revised.  Critical  assumptions  in  estimating  gross  profits  include  those for  surrenders,
                  long-term  fund  growth  rate,  expenses  and death  benefits.  The  long-term  fund growth  rate,  in large part,
                  determines  the  estimated  future asset levels on which the most  significant  revenues are based.  The Company's
                  long-term  fund growth rate  assumption is 8% (net of charges  assessed  against the  underlying  mutual fund, but
                  before charges assessed at the separate  account and contract  level).  When current period actual asset growth is
                  greater or less than the Company's long-term expectation,  the Company adjusts the short-term asset growth rate to
                  a level that will allow the Company,  in the short-term,  to resume the long-term  asset growth rate  expectation.
                  The short-term asset growth rate is subject to constraints surrounding actual market conditions.


                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                              (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                       Notes to Consolidated Financial Statements (continued)

2.       SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

                  Details of deferred acquisition costs and related amortization for the years ended December 31, are as follows:

                                                                 2002            2001            2000
                  Balance at beginning of year              $   1,383,281   $   1,398,192   $   1,087,705
                  Acquisition costs deferred during the
                       year                                       244,322         209,136         495,103
                  Acquisition costs amortized during the
                       year                                      (510,059)       (224,047)       (184,616)
                  Balance at end of year                    $   1,117,544   $   1,383,281   $   1,398,192


                  As asset  growth  rates,  during  2002 and  2001,  have been far below the  Company's  long-term  assumption,  the
                  adjustment to the short-term  asset growth rate had risen to a level,  before being capped,  that in  management's
                  opinion was excessive in the current  market  environment.  Based on an analysis of those  short-term  rates,  the
                  related estimates of future gross profits and an impairment study,  management of the Company  determined that the
                  short-term  asset  growth  rate  should be reset to the  level of the  long-term  growth  rate  expectation  as of
                  September 30, 2002.  This resulted in an acceleration of amortization of approximately $206,000.

                  Throughout  the year,  the Company  also  updated  its future  estimated  gross  profits  with  respect to certain
                  mortality  assumptions  reflecting actual experience and the decline in the equity markets resulting in additional
                  increased amortization of approximately $72,000.

         J.       Reinsurance

                  The Company cedes reinsurance under modified  co-insurance  arrangements.  These reinsurance  arrangements provide
                  additional  capacity  for growth in  supporting  the cash flow  strain  from the  Company's  variable  annuity and
                  variable life insurance business.  The reinsurance is effected under quota share contracts.

                  At December 31, 2002 and 2001,  in accordance  with the  provisions of the modified  coinsurance  agreements,  the
                  Company accrued approximately $5,447 and $7,733,  respectively,  for amounts receivable from favorable reinsurance
                  experience on certain blocks of variable annuity business.

         K.       Translation of Foreign Currency

                  The  financial  position  and  results of  operations  of Skandia  Vida are  measured  using  local  currency as the
                  functional  currency.  Assets and  liabilities  are  translated  at the  exchange  rate in effect at each  year-end.
                  Statements of income and changes in  shareholder's  equity  accounts are  translated at the average rate  prevailing
                  during the year.  Translation  adjustments  arising from the use of differing  exchange  rates from period to period
                  are reported as a component of other comprehensive income.

                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                              (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                       Notes to Consolidated Financial Statements (continued)

2.       SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

         L.       Separate Accounts

                  Assets and liabilities in separate  accounts are included as separate  captions in the consolidated  statements of
                  financial  condition.  Separate  account  assets  consist  principally  of long term bonds,  investments in mutual
                  funds,  short-term  securities  and  cash and cash  equivalents,  all of which  are  carried  at fair  value.  The
                  investments  are managed  predominately  through  ASISI,  utilizing  various fund  managers as  sub-advisors.  The
                  remaining  investments  are  managed  by  independent  investment  firms.  The  contract  holder has the option of
                  directing  funds to a wide variety of investment  options,  most of which invest in mutual funds.  The  investment
                  risk on the  variable  portion  of a  contract  is  borne by the  contract  holder.  Fixed  options  with  minimum
                  guaranteed  interest rates are also  available.  The Company bears the credit risk associated with the investments
                  that support these fixed options.

                  Included in Separate Account  liabilities are reserves of $1,828,048 and $1,092,944 at December 31, 2002 and 2001,
                  respectively,  relating to deferred annuity investment options for which the contract holder is guaranteed a fixed
                  rate of  return.  These  reserves  are  calculated  using the  Commissioners  Annuity  Reserve  Valuation  Method.
                  Separate  Account assets of $1,828,048 and $1,092,944 at December 31, 2002 and 2001,  respectively,  consisting of
                  fixed maturities, equity securities,  short-term securities, cash and cash equivalents, accrued investment income,
                  accrued liabilities and amounts due to/from the General Account are held in support of these annuity  obligations,
                  pursuant to state regulation.

                  Included in the general  account,  within  Reserves for Future Policy and Contract  Benefits,  is the market value
                  adjustment associated with the guaranteed,  fixed rate investment options, assuming the market value adjustment at
                  the reporting date.

                  Net investment  income (including net realized capital gains and losses) and interest credited to contract holders
                  on separate account assets are not separately reflected in the Consolidated Statements of Income.

         M.       Unearned Performance Credits

                  The Company  defers  certain  bonus  credits  applied to  contract  holder  deposits.  The credit is reported as a
                  contract holder liability within separate account  liabilities and the deferred expense is reported as a component
                  of other  assets.  As the contract  holder must keep the contract  in-force for 10 years to earn the bonus credit,
                  the Company  amortizes  the  deferred  expense on a  straight-line  basis over 10 years.  If the  contract  holder
                  surrenders the contract or the contract holder dies prior to the end of 10 years,  the bonus credit is returned to
                  the  Company.  This  component  of the bonus  credit  is  amortized  in  proportion  to  expected  surrenders  and
                  mortality.  As of December  31, 2002 and 2001,  the  unearned  performance  credit  asset was $83,288 and $89,234,
                  respectively.


                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                              (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                       Notes to Consolidated Financial Statements (continued)

2.       SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

         N.       Estimates

                  The  preparation of financial  statements in conformity with U.S. GAAP requires that management make estimates and
                  assumptions that affect the reported amount of assets and liabilities at the date of the financial  statements and
                  the reported  amounts of revenues and expenses during the reporting  period.  The more  significant  estimates and
                  assumptions are related to deferred  acquisition costs and involve  estimates of future policy lapses,  investment
                  returns and maintenance expenses.  Actual results could differ from those estimates.

3.       INVESTMENTS

         The  amortized  cost,  gross  unrealized  gains and losses and fair value of fixed  maturities  and  investments  in equity
         securities  as of December  31,  2002 and 2001 are shown  below.  All  securities  held at December  31, 2002 and 2001 were
         publicly traded.

         Investments in fixed maturities as of December 31, 2002 consisted of the following:

                                                                     Gross          Gross
                                                    Amortized     Unrealized     Unrealized
                                                      Cost           Gains         Losses       Fair Value
         U.S. Government obligations              $    270,969   $    15,658       $    (78)   $    286,549
         Obligations of state and political
           subdivisions                                    253             9             (1)            261
         Corporate securities                          108,200         3,631            (40)        111,791
              Totals                              $    379,422   $    19,298       $   (119)   $    398,601


         The amortized  cost and fair value of fixed  maturities,  by  contractual  maturity,  at December 31, 2002 are shown below.
         Actual maturities may differ from contractual maturities due to call or prepayment provisions.

                                                       Amortized
                                                          Cost      Fair Value
         Due in one year or less                      $    12,793   $    12,884
         Due after one through five years                 165,574       171,830
         Due after five through ten years                 186,609       198,913
         Due after ten years                               14,446        14,974
           Total                                      $   379,422   $   398,601








                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                              (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                       Notes to Consolidated Financial Statements (continued)

3.       INVESTMENTS (continued)

         Investments in fixed maturities as of December 31, 2001 consisted of the following:

                                                                     Gross          Gross
                                                    Amortized     Unrealized     Unrealized
                                                      Cost           Gains         Losses       Fair Value
         U.S. Government obligations                 $198,136         $2,869          $(413)      $200,592
         Obligations of state and political
           subdivisions                                   252              8              -            260
         Corporate securities                         158,494          4,051           (566)       161,979
              Totals                                 $356,882         $6,928          $(979)      $362,831

         Proceeds from sales of fixed  maturities  during 2002,  2001 and 2000 were $367,213,  $386,816 and $302,632,  respectively.
         Proceeds from maturities during 2002, 2001 and 2000 were $50, $4,000 and $1,104, respectively.

         The cost, gross unrealized gains/losses and fair value of investments in equity securities at December 31 are shown below:

                                                           Gross          Gross
                                                        Unrealized     Unrealized        Fair
                                            Cost           Gains         Losses          Value
         2002                             $ 52,017         $ 136        $    (384)     $ 51,769
         2001                             $  49,886        $ 122        $ (4,925)      $ 45,083

         Net realized  investment  gains  (losses),  determined on a specific  identification  basis,  were as follows for the years
         ended December 31:

                                                          2002          2001           2000
         Fixed maturities:
           Gross gains                                $    8,213      $  8,849       $  1,002
           Gross losses                                   (4,468)       (4,387)        (3,450)

         Investment in equity securities:
           Gross gains                                        90           658          1,913
           Gross losses                                  (13,451)       (4,192)          (153)

              Totals                                  $   (9,616)     $    928       $   (688)

         During  2002,  the  Company  determined  that  certain  amounts  of its  investment  in equity  securities  were other than
         temporarily impaired and, accordingly, recorded a loss of $3,769.

         As of December  31, 2002,  the Company did not own any  investments  in fixed  maturity  securities  whose  carrying  value
         exceeded 10% of the Company's equity.




                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                              (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                       Notes to Consolidated Financial Statements (continued)

3.       INVESTMENTS (continued)

         As of December 31, 2002, the following fixed maturities were restricted in compliance with regulatory requirements:

         Security                                                      Fair Value
         U.S. Treasury Note, 6.25%, February 2003                           $4,345
         U.S. Treasury Note, 3.00%, November 2003                              183
         Puerto Rico Commonwealth, 4.60%, July 2004                            210
         Puerto Rico Commonwealth, 4.875%, July 2023                            52

4.       FAIR VALUES OF FINANCIAL INSTRUMENTS

         The methods and assumptions used to determine the fair value of financial instruments are as follows:

         Fair values of fixed  maturities with active markets are based on quoted market prices.  For fixed maturities that trade in
         less active markets, fair values are obtained from an independent pricing service.

         Fair values of equity securities are based on quoted market prices.

         The fair value of derivative instruments is determined based on the current value of the underlying index.

         The carrying  value of cash and cash  equivalents  (cost)  approximates  fair value due to the  short-term  nature of these
         investments.

         The carrying value of policy loans approximates fair value.

         Fair value of future fees payable to ASI are determined on a discounted  cash flow basis,  using best estimate  assumptions
         of lapses, mortality, free withdrawals and a long-term fund growth rate of 8% on the Company's assets under management.

         The  carrying  value of  short-term  borrowings  (cost)  approximates  fair  value  due to the  short-term  nature of these
         liabilities.

         Fair value of surplus notes are determined based on a discounted cash flow basis with a projected  payment of principal and
         all accrued interest at the maturity date (see Note 14 for payment restrictions).



                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                              (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                       Notes to Consolidated Financial Statements (continued)

4.       FAIR VALUES OF FINANCIAL INSTRUMENTS (continued)

         The fair values and carrying values of financial instruments at December 31, 2002 and 2001 are as follows:

                                                   December 31, 2002                December 31, 2001
                                             Fair Value     Carrying Value    Fair Value     Carrying Value
                                           -------------- ------------------ ------------- ------------------
                                           -------------- ------------------ ------------- ------------------
        Assets
        Fixed Maturities                         $398,601           $398,601      $362,831           $362,831
        Equity Securities                          51,769             51,769        45,083             45,083
        Derivative Instruments                     10,370             10,370         5,525              5,525
        Policy Loans                                7,559              7,559         6,559              6,559

        Liabilities
        Future Fees Payable to ASI                429,773            708,249       546,357            799,472
        Short-term Borrowing                       10,000             10,000        10,000             10,000
        Surplus Notes and accrued
           interest of $29,230 and
           $25,829 in 2002 and 2001,
           respectively                           140,777            139,230       174,454            169,829

5.       NET INVESTMENT INCOME

         The sources of net investment income for the years ended December 31 were as follows:

                                                          2002          2001           2000
         Fixed maturities                              $  18,015     $  18,788      $  13,502
         Cash and cash equivalents                         1,116           909          5,209
         Equity securities                                   809           622             99
         Policy loans                                        403           244             97
         Total investment income                          20,343        20,563         18,907
         Investment expenses                                (711)         (437)          (312)
         Net investment income                         $19,632       $  20,126      $  18,595


6.       INCOME TAXES

         The significant components of income tax expense for the years ended December 31 were as follows:

                                                            2002          2001         2000
         Current tax benefit                            $    (3,739)   $  (39,047)  $   (29,244)
         Deferred tax expense, excluding operating
           loss carryforwards                                35,915        60,587        60,023
         Deferred tax benefit for operating and
           capital loss carryforwards                      (134,986)      (14,372)            -
              Total income tax (benefit) expense        $  (102,810)   $    7,168   $    30,779



                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                              (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                           Notes to Consolidated Financial Statements (continued)

6.       INCOME TAXES (continued)

         Deferred tax assets (liabilities) include the following at December 31:

                                                           2002          2001
         Deferred tax assets:
           GAAP to tax reserve differences             $   165,348   $   241,503
           Future fees payable to ASI                       21,475        63,240
           Deferred compensation                            20,603        20,520
           Net operating loss carry forward                147,360        14,372
           Other                                             6,530        17,276
              Total deferred tax assets                    361,316       356,911

         Deferred tax liabilities:
           Deferred acquisition costs, net                (312,933)     (404,758)
           Net unrealized gains on fixed
              maturity securities                           (6,713)       (2,082)
           Other                                            (3,464)       (5,051)
              Total deferred tax liabilities              (323,110)     (411,891)
                Net deferred tax asset (liability)     $    38,206   $   (54,980)

         In  accordance  with SFAS 109, the Company has  performed an analysis of its deferred tax assets to assess  recoverability.
         Looking at a variety of items,  most  notably,  the timing of the reversal of  temporary  items and future  taxable  income
         projections, the Company determined that no valuation allowance is needed.

         The income tax (benefit)  expense was different from the amount computed by applying the federal  statutory tax rate of 35%
         to pre-tax income from continuing operations as follows:

                                                                   2002            2001           2000
         (Loss) income before taxes
           Domestic                                           $   (265,361)   $   42,886      $   98,136
           Foreign                                                  (2,706)       (2,619)         (2,540)
           Total                                                  (268,067)       40,267          95,596
           Income tax rate                                              35%           35%             35%
         Tax (benefit) expense at federal statutory income
           tax rate                                                (93,823)       14,093          33,459

         Tax effect of:
           Dividend received deduction                             (12,250)       (8,400)         (7,350)
           Losses of foreign subsidiary                                947           917             889
           Meals and entertainment                                     603           603             841
           State income taxes                                            -           (62)           (524)
           Federal provision to return differences                     709          (177)          3,235
           Other                                                     1,004           194             229
              Income tax (benefit) expense                    $   (102,810)   $    7,168      $   30,779

         The Company's net operating loss carry  forwards,  totaling  approximately  $421,029  (pre-tax) at December 31, 2002,  will
         expire in 2016 and 2017.

                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                              (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                       Notes to Consolidated Financial Statements (continued)

7.       COST ALLOCATION AGREEMENTS WITH AFFILIATES

         Certain  operating costs (including rental of office space,  furniture,  and equipment) have been charged to the Company at
         cost by American Skandia Information Services and Technology Corporation  ("ASIST"),  an affiliated company. ASLAC signed a
         written service  agreement with ASIST for these services executed and approved by the Connecticut  Insurance  Department in
         1995.  This  agreement  automatically  continues in effect from year to year and may be  terminated by either party upon 30
         days written notice.  The Company has also paid and charged  operating  costs to several of its affiliates.  The total cost
         to the Company for these items was $8,177,  $6,179 and $13,974 in 2002,  2001 and 2000,  respectively.  Income received for
         these items was approximately $13,052, $13,166 and $11,186 in 2002, 2001 and 2000, respectively.

         Allocated  depreciation  expense  was  $7,440,  $8,764 and $9,073 in 2002,  2001 and 2000,  respectively.  Allocated  lease
         expense was $5,808,  $6,517 and $5,606 in 2002, 2001 and 2000,  respectively.  Allocated sub-lease rental income,  recorded
         as a reduction to lease  expense,  was $738,  $30 and $0 in 2002,  2001 and 2000,  respectively.  Assuming that the written
         service  agreement  between ASLAC and ASIST continues  indefinitely,  ASLAC's  allocated  future minimum lease payments and
         sub-lease receipts per year and in aggregate as of December 31, 2002 are as follows:

                                                                       Lease         Sub-Lease
                                  2003                            $     4,847      $     1,616
                                  2004                                  5,275            1,773
                                  2005                                  5,351            1,864
                                  2006                                  5,328            1,940
                                  2007                                  5,215            1,788
                                  2008 and thereafter                  19,629            7,380
                                  Total                           $    45,645      $    16,361


         Beginning in 1999, the Company was reimbursed by ASM for certain  distribution  related costs  associated with the sales of
         business through an investment firm where ASM serves as an introducing  broker dealer.  Under this agreement,  the expenses
         reimbursed were $8,255, $6,610 and $6,064 in 2002, 2001 and 2000,  respectively.  As of December 31, 2002 and 2001, amounts
         receivable under this agreement were approximately $458 and $639, respectively.












                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                              (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                       Notes to Consolidated Financial Statements (continued)

8.       FUTURE FEES PAYABLE TO ASI

         In a series of  transactions  with ASI,  the  Company  transferred  certain  rights to receive a portion of future fees and
         contract charges expected to be realized on designated blocks of deferred annuity contracts.

         The proceeds from the transfers  have been recorded as a liability  and are being  amortized  over the remaining  surrender
         charge period of the  designated  contracts  using the interest  method.  The Company did not transfer the right to receive
         future fees and charges after the expiration of the surrender charge period.

         In connection  with these  transactions,  ASI,  through  special purpose  trusts,  issued  collateralized  notes in private
         placements, which are secured by the rights to receive future fees and charges purchased from the Company.

         Under the terms of the securitization  purchase agreements,  the rights transferred provide for ASI to receive a percentage
         (60%, 80% or 100% depending on the underlying  commission  option) of future  mortality and expense  charges and contingent
         deferred  sales  charges,  after  reinsurance,  expected to be realized over the remaining  surrender  charge period of the
         designated  contracts  (generally 6 to 8 years).  The liability for future fees payable to ASI at the balance sheet date is
         based on the consideration  received less principal repayments  according to amortization  schedules that were developed at
         the inception of the transactions.  If actual mortality and expense charges and contingent  deferred sales charges are less
         than those projected in the original amortization  schedules,  calculated on a transaction by transaction basis, ASI has no
         recourse against the Company.  As account values  associated with the designated  contracts have declined,  consistent with
         the overall decline in the equity markets,  current  mortality and expense charges have been lower than expected on certain
         transactions  and it is likely that future mortality and expense charges,  on those same  transactions,  will be lower than
         originally  projected.  As a result,  the ultimate cash flows associated with these  transactions that will transfer to ASI
         may be lower than the current carrying amount of the liability (see Note 4).

         On April 12, 2002, the Company  entered into a new  securitization  purchase  agreement with ASI. This  transaction  covers
         designated  blocks of business issued from November 1, 2000 through  December 31, 2001. The estimated  present value of the
         transaction at April 12, 2002, using a discount rate of 6.00%, was $101,713.

         Payments,  representing  fees and charges in the  aggregate  amount,  of $186,810,  $207,731 and $219,523  were made by the
         Company to ASI in 2002,  2001 and 2000,  respectively.  Related  interest  expense of $828,  $59,873  and  $70,667 has been
         included in the consolidated statements of income for 2002, 2001 and 2000, respectively.

         The  Commissioner of the State of Connecticut has approved the transfer of future fees and charges;  however,  in the event
         that the  Company  becomes  subject to an order of  liquidation  or  rehabilitation,  the  Commissioner  has the ability to
         restrict the payments due to ASI,  into a restricted  account,  under the Purchase  Agreement  subject to certain terms and
         conditions.

                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                              (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                       Notes to Consolidated Financial Statements (continued)

8.       FUTURE FEES PAYABLE TO ASI (continued)

         The present values of the transactions as of the respective effective date were as follows:

                              Closing      Effective        Contract Issue        Discount       Present
           Transaction         Date          Date               Period              Rate          Value

             1996-1           12/17/96        9/1/96        1/1/94 - 6/30/96        7.5%          $50,221
             1997-1            7/23/97        6/1/97        3/1/96 - 4/30/97        7.5%           58,767
             1997-2           12/30/97       12/1/97        5/1/95 - 12/31/96       7.5%           77,552
             1997-3           12/30/97       12/1/97        5/1/96 - 10/31/97       7.5%           58,193
             1998-1            6/30/98        6/1/98        1/1/97 - 5/31/98        7.5%           61,180
             1998-2           11/10/98       10/1/98        5/1/97 - 8/31/98        7.0%           68,573
             1998-3           12/30/98       12/1/98        7/1/96 - 10/31/98       7.0%           40,128
             1999-1            6/23/99        6/1/99        4/1/94 - 4/30/99        7.5%          120,632
             1999-2           12/14/99       10/1/99       11/1/98 - 7/31/99        7.5%          145,078
             2000-1            3/22/00        2/1/00        8/1/99 - 1/31/00        7.5%          169,459
             2000-2            7/18/00        6/1/00        2/1/00 - 4/30/00        7.25%          92,399
             2000-3           12/28/00       12/1/00        5/1/00 - 10/31/00       7.25%         107,291
             2000-4           12/28/00       12/1/00        1/1/98 - 10/31/00       7.25%         107,139
             2002-1            4/12/02        3/1/02       11/1/00 - 12/31/01       6.00%         101,713

         Payments of future fees  payable to ASI,  according  to original  amortization  schedules,  as of December  31, 2002 are as
         follows:

                                          Year         Amount

                                          2003      $   186,854
                                          2004          171,093
                                          2005          147,902
                                          2006          117,761
                                          2007           66,270
                                          2008           18,369
                                          Total     $   708,249


                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                              (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                       Notes to Consolidated Financial Statements (continued)

9.       LEASES

         The Company  entered into an eleven year lease agreement for office space in Westminster,  Colorado,  effective  January 1,
         2001.  Lease expense for 2002 and 2001 was $2,583 and $1,602,  respectively.  Sub-lease  rental income was $227 in 2002 and
         $0 in 2001.  Future minimum lease payments and sub-lease  receipts per year and in aggregate as of December 31, 2002 are as
         follows:

                                                                       Lease           Sub-Lease
                                   2003                          $    1,913         $      426
                                   2004                               1,982                455
                                   2005                               2,050                500
                                   2006                               2,050                533
                                   2007                               2,050                222
                                   2008 and thereafter                8,789                  0
                                   Total                         $   18,834         $    2,136


10.      RETAINED EARNINGS AND DIVIDEND RESTRICTIONS

         Statutory basis shareholder's equity was $279,957 and $226,780 at December 31, 2002 and 2001, respectively.

         The Company  incurred  statutory  basis net losses in 2002 of $192,474 due primarily to significant  declines in the equity
         markets,  increasing GMDB reserves calculated on a statutory basis.  Statutory basis net losses for 2001 were $121,957,  as
         compared to income of $11,550 in 2000.

         Under  various  state  insurance  laws,  the maximum  amount of dividends  that can be paid to  shareholders  without prior
         approval of the state  insurance  department  is subject to  restrictions  relating to statutory  surplus and net gain from
         operations.  For 2003, no amounts may be distributed without prior approval.

11.      STATUTORY ACCOUNTING PRACTICES

         The Company  prepares its statutory basis financial  statements in accordance with accounting  practices  prescribed by the
         State of Connecticut Insurance  Department.  Prescribed statutory accounting practices include publications of the National
         Association of Insurance Commissioners (NAIC), as well as state laws, regulations and general administrative rules.

         The NAIC adopted the Codification of Statutory Accounting  Principles  (Codification) in March 1998. The effective date for
         codification was January 1, 2001. The Company's state of domicile,  Connecticut,  has adopted  codification and the Company
         has made the necessary changes in its statutory  accounting and reporting required for  implementation.  The overall impact
         of adopting  codification in 2001 was a one-time,  cumulative  change in accounting  benefit recorded directly in statutory
         surplus of $12,047.

         In addition,  during 2001,  based on a  recommendation  from the State of  Connecticut  Insurance  Department,  the Company
         changed its statutory method of accounting for its

                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                              (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                       Notes to Consolidated Financial Statements (continued)

11.      STATUTORY ACCOUNTING PRACTICES (continued)

         liability  associated  with  securitized  variable  annuity  fees.  Under the new method of  accounting,  the liability for
         securitized  fees is  established  consistent  with the method of  accounting  for the liability  associated  with variable
         annuity fees ceded under  reinsurance  contracts.  This equates to the  statutory  liability  at any  valuation  date being
         equal to the  Commissioners  Annuity  Reserve  Valuation  Method (CARVM) offset related to the securitized  contracts.  The
         impact of this change in accounting,  representing  the difference in the liability  calculated under the old method versus
         the new  method as of January 1, 2001,  was  reported  as a  cumulative  effect of change in  accounting  benefit  recorded
         directly in statutory surplus of approximately $20,215.

         In 2001,  the Company,  in agreement  with the  Connecticut  Insurance  Department,  changed its reserving  methodology  to
         recognize free partial  withdrawals  and to reserve on a  "continuous"  rather than  "curtate"  basis.  The impact of these
         changes,  representing  the difference in reserves  calculated  under the new methods versus the old methods,  was recorded
         directly to surplus as changes in reserves on account of valuation  basis.  This resulted in an increase to the  unassigned
         deficit of approximately $40,511.

         Effective January 1, 2002, the Company adopted  Statement of Statutory  Accounting  Principles No. 82,  "Accounting for the
         Costs of Computer  Software  Developed or Obtained for Internal Use and Web Site  Development  Costs" ("SSAP 82").  SSAP 82
         requires the  capitalization  of certain costs incurred in connection with  developing or obtaining  internal use software.
         Prior to the adoption of SSAP 82, the Company  expensed all internal use software  related  costs as incurred.  The Company
         has  identified  and  capitalized  $5,935 of costs  associated  with  internal  use  software  as of January 1, 2002 and is
         amortizing the applicable  costs on a  straight-line  basis over a three year period.  The costs  capitalized as of January
         1, 2002 resulted in a direct increase to surplus.  Amortization expense for the year ended December 31, 2002 was $757.

12.      EMPLOYEE BENEFITS

         The Company has a 401(k) plan for which  substantially  all employees are eligible.  Under this plan, the Company  provides
         a 50% match on  employees'  contributions  up to 6% of an  employee's  salary  (for an  aggregate  match of up to 3% of the
         employee's  salary).  Additionally,  the Company may contribute  additional  amounts based on  profitability of the Company
         and  certain of its  affiliates.  Expenses  related to this  program in 2002,  2001 and 2000 were $719,  $2,738 and $3,734,
         respectively.  Company  contributions  to this plan on behalf of the  participants  were  $921,  $2,549 and $4,255 in 2002,
         2001 and 2000, respectively.

         The  Company  has a  deferred  compensation  plan,  which is  available  to the field  marketing  staff and  certain  other
         employees.  Expenses  related  to this  program  in 2002,  2001 and 2000 were  $3,522,  $1,615  and  $1,030,  respectively.
         Company  contributions  to this plan on behalf of the participants  were $5,271,  $1,678 and $2,134 in 2002, 2001 and 2000,
         respectively.

         The Company and certain  affiliates  cooperatively  have a  long-term  incentive  program  under which units are awarded to
         executive  officers and other  personnel.  The Company and certain  affiliates  also have a profit sharing  program,  which
         benefits all employees

                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                              (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                       Notes to Consolidated Financial Statements (continued)

12.      EMPLOYEE BENEFITS (continued)

         below the  officer  level.  These  programs  consist of  multiple  plans with new plans  instituted  each year.  Generally,
         participants  must remain  employed by the Company or its affiliates at the time such units are payable in order to receive
         any payments  under the programs.  The accrued  liability  representing  the value of these units was $7,083 and $13,645 as
         of December 31, 2002 and 2001,  respectively.  Expenses  (income)  related to these programs in 2002,  2001 and 2000,  were
         $1,471,  ($9,842) and $2,692,  respectively.  Payments under these programs were $8,033,  $8,377 and $13,697 in 2002,  2001
         and 2000, respectively.

13.      FINANCIAL REINSURANCE

         The Company cedes insurance to other insurers in order to fund the cash strain  generated from commission  costs on current
         sales  and to limit its risk  exposure.  The  Company  uses  modified  coinsurance  reinsurance  arrangements  whereby  the
         reinsurer shares in the experience of a specified book of business.  These reinsurance  transactions  result in the Company
         receiving  from the  reinsurer an upfront  ceding  commission  on the book of business  ceded in exchange for the reinsurer
         receiving  in the  future,  the future  fees  generated  from that book of  business.  Such  transfer  does not relieve the
         Company of its primary  liability and, as such,  failure of reinsurers to honor their  obligation could result in losses to
         the Company.  The Company reduces this risk by evaluating the financial condition and credit worthiness of reinsurers.

         The effect of reinsurance for the 2002, 2001 and 2000 was as follows:

        2002                                                            Gross          Ceded           Net
        Annuity and life insurance charges and fees                 $   406,272     $   (36,268)  $   370,004
        Return credited to contract owners                          $     5,221     $       (25)  $     5,196
        Underwriting, acquisition and other insurance
        expenses (deferal of acquisition costs)                     $   154,588     $    34,140   $   188,728
        Amortization of deferred acquisition costs                  $   542,945     $   (32,886)  $   510,059


        2001
        Annuity and life insurance charges and fees                 $   430,914     $   (42,218)  $   388,696
        Return credited to contract owners                          $     5,704     $        92   $     5,796
        Underwriting, acquisition and other insurance
        expenses (deferral of acquisition costs)                    $   163,677     $    33,078   $   196,755
        Amortization of deferred acquisition costs                  $   231,290     $    (7,243)  $   224,047


        2000
        Annuity and life insurance charges and fees                 $   473,318     $   (48,740)  $   424,578
        Return credited to contract owners                          $     8,540     $       (77)  $     8,463
        Underwriting, acquisition and other insurance
        expenses (deferral of acquisition costs)                    $   108,399     $    42,198   $   150,597
        Amortization of deferred acquisition costs                  $   205,174     $   (20,558)  $   184,616

         In December 2000, the Company entered into a modified  coinsurance  agreement with SICL covering  certain  contracts issued
         since January 1996.  The impact of this treaty to the

                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                              (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                       Notes to Consolidated Financial Statements (continued)

13.      FINANCIAL REINSURANCE (continued)

         Company was pre-tax (loss) income of ($4,137),  $8,394 and $23,341 in 2002,  2001 and 2000,  respectively.  At December 31,
         2002 and 2001, $675 and $1,137, respectively, was receivable from SICL under this agreement.

14.      SURPLUS NOTES

         The Company has issued  surplus notes to ASI in exchange for cash.  Surplus notes  outstanding  as of December 31, 2002 and
         2001, and interest expense for 2002, 2001 and 2000 were as follows:

                                                     Liability as of
                                                      December 31,                    Interest Expense
                                   Interest                                            For the Years
            Note Issue Date          Rate          2002          2001          2002         2001         2000
         ----------------------    ---------     ----------    ----------    ---------    ---------    ---------
         ----------------------    ---------     ----------

         February 18, 1994           7.28%               -             -             -            -          732
         March 28, 1994              7.90%               -             -             -            -          794
         September 30, 1994          9.13%               -             -             -        1,282        1,392
         December 19, 1995           7.52%               -        10,000           520          763          765
         December 20, 1995           7.49%               -        15,000           777        1,139        1,142
         December 22, 1995           7.47%               -         9,000           465          682          684
         June 28, 1996               8.41%          40,000        40,000         3,411        3,411        3,420
         December 30, 1996           8.03%          70,000        70,000         5,699        5,699        5,715
                                                 ----------    ----------    ---------    ---------    ---------
                                                 ----------    ----------    ---------    ---------    ---------

         Total                                    $110,000      $144,000       $10,872      $12,976      $14,644
                                                 ==========    ==========    =========    =========    =========

         On September 6, 2002,  surplus notes for $10,000,  dated December 19, 1995,  $15,000,  dated December 20, 1995, and $9,000,
         dated  December 22, 1995,  were repaid.  On December 3, 2001, a surplus note,  dated  September  30, 1994,  for $15,000 was
         repaid.  On December 27, 2000,  surplus  notes for $10,000,  dated  February 18, 1994,  and $10,000,  dated March 28, 1994,
         were repaid.  All surplus notes mature seven years from the issue date.

         Payment of interest and repayment of principal  for these notes is subject to certain  conditions  and require  approval by
         the  Insurance  Commissioner  of  the  State  of  Connecticut.  At  December  31,  2002  and  2001,  $29,230  and  $25,829,
         respectively, of accrued interest on surplus notes was not permitted for payment under these criteria.

15.      SHORT-TERM BORROWING

         The Company  had a $10,000  short-term  loan  payable to ASI at  December  31,  2002 and 2001 as part of a  revolving  loan
         agreement.  The loan had an interest  rate of 1.97% and  matured on January  13,  2003.  The loan was  subsequently  rolled
         over with a new interest  rate of 1.82% and a new maturity date of March 13, 2003.  The loan was further  extended to April
         30, 2003 and a new interest rate of 1.71%.  The total related  interest  expense to the Company was $271,  $522 and $687 in
         2002,  2001  and  2000,  respectively.  Accrued  interest  payable  was $10 and $113 as of  December  31,  2002  and  2001,
         respectively.



                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                              (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                       Notes to Consolidated Financial Statements (continued)

15.      SHORT-TERM BORROWING (continued)

         On January 3, 2002,  the Company  entered into a $150,000  credit  facility  with ASI. This credit  facility  terminates on
         December  31, 2005 and bears  interest at the offered  rate in the London  interbank  market  (LIBOR) plus 0.35 percent per
         annum for the  relevant  interest  period.  Interest  expense  related  to these  borrowings  was $2,243 for the year ended
         December 31, 2002.  As of December 31, 2002, no amount was outstanding under this credit facility.

16.      CONTRACT WITHDRAWAL PROVISIONS

         Approximately  99% of the  Company's  separate  account  liabilities  are subject to  discretionary  withdrawal by contract
         owners at market value or with market value  adjustment.  Separate  account  assets,  which are carried at fair value,  are
         adequate to pay such  withdrawals,  which are generally  subject to surrender  charges ranging from 10% to 1% for contracts
         held less than 10 years.

17.      RESTRUCTURING CHARGES

         On March 22, 2001 and  December 3, 2001,  the  Company  announced  separate  plans to reduce  expenses to better  align its
         operating  infrastructure  with  the  current  investment  market  environment.  As part of the two  plans,  the  Company's
         workforce was reduced by approximately  140 positions and 115 positions,  respectively,  affecting  substantially all areas
         of the Company.  Estimated  pre-tax  severance  benefits of $8,500 have been charged  against  2001  operations  related to
         these  reductions.  These  charges  have  been  reported  in the  Consolidated  Statements  of  Income  as a  component  of
         Underwriting,  Acquisition  and Other  Insurance  Expenses.  As of December 31, 2002 and 2001, the remaining  restructuring
         liability, relating primarily to the December 3, 2001 plan, was $12 and $4,104, respectively.

18.      COMMITMENTS AND CONTINGENT LIABILITIES

         In recent years, a number of annuity  companies have been named as defendants in class action lawsuits  relating to the use
         of variable  annuities as funding  vehicles for tax- qualified  retirement  accounts.  The Company is currently a defendant
         in one such lawsuit.  A purported  class action  complaint was filed in the United States  District  Court for the Southern
         District of New York on December  12,  2002,  by Diane C. Donovan  against the Company and certain of its  affiliates  (the
         "Donovan  Complaint").  The  Donovan  Complaint  seeks  unspecified  compensatory  damages and  injunctive  relief from the
         Company  and  certain of its  affiliates.  The Donovan  Complaint  claims  that the  Company and certain of its  affiliates
         violated  federal  securities laws in marketing  variable  annuities.  This litigation is in the  preliminary  stages.  The
         Company believes this action is without merit, and intends to vigorously defend against this action.

         The  Company is also  involved  in other  lawsuits  arising,  for the most part,  in the  ordinary  course of its  business
         operations.  While the outcome of these other  lawsuits  cannot be  determined  at this time,  after  consideration  of the
         defenses  available  to the  Company,  applicable  insurance  coverage and any related  reserves  established,  these other
         lawsuits are not expected to result in liability for amounts material to the financial  condition of the Company,  although
         it may adversely affect results of operations in future periods.

                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                              (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                       Notes to Consolidated Financial Statements (continued)

18.      COMMITMENTS AND CONTINGENT LIABILITIES (continued)

         As  discussed  previously,  on December  19,  2002,  SICL entered  into a  definitive  purchase  agreement  (the  "Purchase
         Agreement") to sell its ownership interest in the Company and certain affiliates to Prudential  Financial for approximately
         $1.265  billion.  The closing of this  transaction,  which is  conditioned  upon  certain  customary  regulatory  and other
         approvals and conditions, is expected in the second quarter of 2003.

         The purchase  price that was agreed to between SICL and  Prudential  Financial was based on a September 30, 2002  valuation
         of the Company and certain  affiliates.  As a result,  assuming the  transaction  closes,  the  economics of the  Company's
         business from  September 30, 2002 forward will inure to the benefit or detriment of Prudential  Financial.  Included in the
         Purchase Agreement,  SICL has agreed to indemnify  Prudential  Financial for certain liabilities that may arise relating to
         periods prior to September 30, 2002. These  liabilities  generally include market conduct  activities,  as well as contract
         and regulatory compliance (referred to as "Covered Liabilities").

         Related to the  indemnification  provisions  contained in the Purchase  Agreement,  SICL has signed, for the benefit of the
         Company,  an indemnity letter,  effective December 19, 2002, to make the Company whole for certain Covered Liabilities that
         come to  fruition  during  the period  beginning  December  19,  2002 and ending  with the close of the  transaction.  This
         indemnification  effectively  transfers  the risk  associated  with  those  Covered  Liabilities  from the  Company to SICL
         concurrent with the signing of the definitive purchase agreement rather than waiting until the transaction closes.

19.      SEGMENT REPORTING

         Assets under management and sales for products other than variable  annuities have not been  significant  enough to warrant
         full segment  disclosures as required by SFAS 131,  "Disclosures about Segments of an Enterprise and Related  Information,"
         and the Company does not  anticipate  that they will be so in the future due to changes in the Company's  strategy to focus
         on its core variable annuity business.
















                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                              (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                       Notes to Consolidated Financial Statements (continued)

20.      QUARTERLY FINANCIAL DATA (UNAUDITED)

         The following table summarizes information with respect to the operations of the Company on a quarterly basis:

                                                                      Three Months Ended
                                                  ----------------------------------------------------------
                          2002                      March 31       June 30       Sept. 30        Dec. 31
        Premiums and other insurance revenues*    $   118,797   $    126,614   $    115,931   $    108,488
        Net investment income                           4,965          4,714          5,128          4,825
        Net realized capital losses                    (1,840)        (1,584)        (2,327)        (3,863)
        Total revenues                                121,922        129,744        118,732        109,450
        Benefits and expenses*                        112,759        160,721        323,529        150,906
        Pre-tax net income (loss)                       9,163        (30,977)      (204,797)       (41,456)
        Income tax expense (benefit)                    1,703        (11,746)       (72,754)       (20,013)
        Net income (loss)                         $     7,460   $    (19,231)  $   (132,043)  $    (21,443)

         *    For the quarters ended March 31, 2002 and June 30, 2002, the Company had  overstated  premiums ceded in revenues.  The
              above presentation  reflects an equal and offsetting  reclassification  of these amounts to benefits and expenses with
              no net income impact.

                                                                      Three Months Ended
                                                  ----------------------------------------------------------
                          2001                      March 31       June 30       Sept. 30        Dec. 31
        Premiums and other insurance revenues***  $   130,885   $    128,465   $    122,708   $    119,604
        Net investment income**                         5,381          4,997          5,006          4,742
        Net realized capital gains (losses)             1,902            373            376         (1,723)
        Total revenues                                138,168        133,835        128,090        122,623
        Benefits and expenses**  ***                  122,729        110,444        123,307        125,969
        Pre-tax net income (loss)                      15,439         23,391          4,783         (3,346)
        Income tax expense (benefit)                    4,034          7,451           (480)        (3,837)
        Net income                                $    11,405   $     15,940   $      5,263   $        491

         **   For the quarters  ended March 31, 2001,  June 30, 2001 and  September  30, 2001,  the Company had reported  investment
              performance   associated  with  its  derivatives  as  net  investment  income.  The  above  presentation   reflects  a
              reclassification of these amounts to benefits and expenses.
         ***  For the  quarters  ended  September  30, 2001 and  December 31, 2001,  the Company had  overstated  premiums  ceded in
              revenues.  The above presentation  reflects an equal and offsetting  reclassification of these amounts to benefits and
              expenses with no net income impact.

                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                              (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                       Notes to Consolidated Financial Statements (continued)

20.      QUARTERLY FINANCIAL DATA (UNAUDITED) (continued)

                                                                      Three Months Ended
                                                  ----------------------------------------------------------
                          2000                      March 31       June 30       Sept. 30        Dec. 31
        Premiums and other insurance revenues     $    137,040  $    139,346   $   147,819    $    135,866
        Net investment income****                        4,343         4,625         4,619           5,008
        Net realized capital gains (losses)                729        (1,436)         (858)            877
        Total revenues                                 142,112       142,535       151,580         141,751
        Benefits and expenses****                      107,893       122,382       137,843         114,264
        Pre-tax net income                              34,219        20,153        13,737          27,487
        Income tax expense                              10,038         5,225         3,167          12,349
        Net income                                $     24,181  $     14,928   $    10,570    $     15,138

         ****For the  quarters  ended March 31,  2000,  June 30, 2000,  September  30, 2000 and  December 31, 2000,  the Company had
              reported  investment  performance  associated with its derivatives as net investment  income.  The above  presentation
              reflects a reclassification of these amounts to benefits and expenses.








                               APPENDIX B - CONDENSED FINANCIAL INFORMATION ABOUT SEPARATE ACCOUNT B

Separate  Account B consists  of  multiple  Sub-accounts.  Each  Sub-account  invests  only in a single  mutual  fund or mutual fund
portfolio.  All or some of these  Sub-accounts  are available as investment  options for other variable  annuities we offer pursuant
to different prospectuses.

Unit Prices And Numbers Of Units:  The following table shows:  (a) the Unit Price,  as of the dates shown,  for Units in each of the
Sub-accounts of Separate Account B that are being offered pursuant to this Prospectus;  and (b) the number of Units  outstanding for
each such  Sub-account as of the dates shown.  Since November 18, 2002, we have been  determining,  on a daily basis,  multiple Unit
Prices for each  Sub-account  of Separate  Account B. We compute  multiple  Unit Prices  because  several of our variable  annuities
invest in the same  Sub-accounts,  and these annuities  deduct varying charges that correspond to each combination of the applicable
Insurance  Charge,  Distribution  Charge (when applicable) and the charges for each optional  benefit.  Where an asset-based  charge
corresponding  to a particular  Sub-account  within a new annuity  product is identical  to that in the same  Sub-account  within an
existing  annuity,  the Unit Price for the new annuity will be identical to that of the  existing  annuity.  In such cases,  we will
for reference  purposes depict,  in the condensed  financial  information for the new annuity,  Unit Prices of the existing annuity.
The year in which  operations  commenced in each such  Sub-account is noted in  parentheses.  To the extent a Sub-account  commenced
operations  during a particular  calendar  year,  the Unit Price as of the end of the period  reflects only the partial year results
from the  commencement  of operations  until  December 31st of the  applicable  year.  When a Unit Price was first  calculated for a
particular  Sub-account,  we set the  price of that  Unit at  $10.00  per  Unit.  Thereafter,  Unit  Prices  vary  based  on  market
performance.  Unit Prices and Units are provided for Sub-accounts that commenced operations prior to January 1, 2003.


                                                     Year Ended December 31,
- -------------------------------------------------- ------------- -------------- --------------
Sub-account                                            2002          2001           2000
- -------------------------------------------------- ------------- -------------- --------------
- -------------------------------------------------- ------------- -------------- --------------
AST Strong International Equity 1 (1989)
     With No Optional Benefits
     Unit Price                                           $5.53           6.86           8.99
     Number of Units                                    153,652        136,976         33,897
     With One Optional Benefit
     Unit Price                                           $9.96              -              -
     Number of Units                                     19,651              -              -
     With Any Two Optional Benefits
     Unit Value                                           $9.95              -              -
     Number of Units                                        293              -              -
     With All Optional Benefits
     Unit Price                                               -              -              -
     Number of Units                                          -              -              -
- -------------------------------------------------- ------------- -------------- --------------
- -------------------------------------------------- ------------- -------------- --------------
AST William Blair International Growth 2(1997)
     With No Optional Benefits
     Unit Price                                          $10.35          14.10          18.68
     Number of Units                                      7,064          5,277          6,782
     With One Optional Benefit
     Unit Price                                           $9.72              -              -
     Number of Units                                     19,565              -              -
     With Any Two Optional Benefits
     Unit Price                                           $9.72              -              -
     Number of Units                                     16,068              -              -
     With All Optional Benefits
     Unit Price                                               -              -              -
     Number of Units                                          -              -              -
- -------------------------------------------------- ------------- -------------- --------------
- -------------------------------------------------- ------------- -------------- --------------
AST American Century International Growth 3
(1997)
     With No Optional Benefits
     Unit Price                                           $5.62           7.06           9.84
     Number of Units                                     73,893         60,129         32,368
     With One Optional Benefit
     Unit Price                                           $9.70              -              -
     Number of Units                                      4,261              -              -
     With Any Two Optional Benefits
     Unit Price                                           $9.69              -              -
     Number of Units                                        944              -              -
     With All Optional Benefits
     Unit Price                                               -              -              -
     Number of Units                                          -              -              -
- -------------------------------------------------- ------------- -------------- --------------

                                                     Year Ended December 31,
- -------------------------------------------------- ------------- -------------- --------------
Sub-account                                            2002          2001           2000
- -------------------------------------------------- ------------- -------------- --------------
- -------------------------------------------------- ------------- -------------- --------------
AST DeAM International Equity 4 (1994)
     With No Optional Benefits
     Unit Price                                           $4.43           5.41           8.08
     Number of Units                                     32,967         29,954         20,311
     With One Optional Benefit
     Unit Price                                           $9.80              -              -
     Number of Units                                      4,776              -              -
     With Any Two Optional Benefits
     Unit Price                                           $9.79              -              -
     Number of Units                                        279              -              -
     With All Optional Benefits
     Unit Price                                               -              -              -
     Number of Units                                          -              -              -
- -------------------------------------------------- ------------- -------------- --------------
- -------------------------------------------------- ------------- -------------- --------------
AST MFS Global Equity (1999)
     With No Optional Benefits
     Unit Price                                           $7.48           8.64           9.72
     Number of Units                                     46,925         49,536         23,151
     With One Optional Benefit
     Unit Price                                           $9.87              -              -
     Number of Units                                      1,488              -              -
     With Any Two Optional Benefits
     Unit Price                                               -              -              -
     Number of Units                                          -              -              -
     With All Optional Benefits
     Unit Price                                               -              -              -
     Number of Units                                          -              -              -
- -------------------------------------------------- ------------- -------------- --------------
- -------------------------------------------------- ------------- -------------- --------------
AST PBHG Small-Cap Growth 5 (1994)
     With No Optional Benefits
     Unit Price                                          $12.12          18.70          20.25
     Number of Units                                      6,331          2,439            978
     With One Optional Benefit
     Unit Price                                           $9.48              -              -
     Number of Units                                      6,251              -              -
     With Any Two Optional Benefits
     Unit Price                                               -              -              -
     Number of Units                                          -              -              -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- ------------- -------------- --------------
- -------------------------------------------------- ------------- -------------- --------------
AST DeAM Small-Cap Growth 6 (1999)
     With No Optional Benefits
     Unit Price                                           $4.71           6.48           9.17
     Number of Units                                     44,611         41,602         35,743
     With One Optional Benefit
     Unit Price                                           $9.72              -              -
     Number of Units                                      2,506              -              -
     With Any Two Optional Benefits
     Unit Price                                           $9.72              -              -
     Number of Units                                        277              -              -
     With All Optional Benefits
     Unit Price                                               -              -              -
     Number of Units                                          -              -              -
- -------------------------------------------------- ------------- -------------- --------------
- -------------------------------------------------- ------------- -------------- --------------
AST Federated Aggressive Growth (2000)
     With No Optional Benefits
     Unit Price                                           $4.98           7.12           9.08
     Number of Units                                     25,040         10,912            243
     With One Optional Benefit
     Unit Price                                           $9.87              -              -
     Number of Units                                     14,007              -              -
     With Any Two Optional Benefits
     Unit Price                                           $9.86              -              -
     Number of Units                                      5,370              -              -
     With All Optional Benefits
     Unit Price                                               -              -              -
     Number of Units                                          -              -              -
- -------------------------------------------------- ------------- -------------- --------------

                                                     Year Ended December 31,
- -------------------------------------------------- ------------- -------------- -------------
Sub-account                                            2002          2001           2000
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
AST Gabelli Small-Cap Value 7 (1997)
     With No Optional Benefits
     Unit Price                                          $10.79          12.06         11.41
     Number of Units                                     66,744         33,608        15,339
     With One Optional Benefit
     Unit Price                                          $10.09              -             -
     Number of Units                                     32,914              -             -
     With Any Two Optional Benefits
     Unit Price                                          $10.08              -             -
     Number of Units                                      6,048              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
AST DeAM Small-Cap Value 8 (2002)
     With No Optional Benefits
     Unit Price                                           $7.69              -             -
     Number of Units                                        124              -             -
     With One Optional Benefit
     Unit Price                                          $10.09              -             -
     Number of Units                                      1,519              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
AST Goldman Sachs Mid-Cap Growth 9 (2000)
     With No Optional Benefits
     Unit Price                                           $2.98           4.15          7.03
     Number of Units                                     28,812         17,882         2,473
     With One Optional Benefit
     Unit Price                                           $9.88              -             -
     Number of Units                                     11,936              -             -
     With Any Two Optional Benefits
     Unit Price                                           $9.88              -             -
     Number of Units                                      5,904              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
AST Neuberger Berman Mid-Cap Growth 10 (1994)
     With No Optional Benefits
     Unit Price                                           $4.83           7.11          9.71
     Number of Units                                     56,712         51,711        36,882
     With One Optional Benefit
     Unit Price                                           $9.52              -             -
     Number of Units                                      4,640              -             -
     With Any Two Optional Benefits
     Unit Price                                           $9.51              -             -
     Number of Units                                        915              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
AST Neuberger Berman Mid-Cap Value 11 (1993)
     With No Optional Benefits
     Unit Price                                          $10.26          11.62         12.13
     Number of Units                                     69,657         56,219        16,574
     With One Optional Benefit
     Unit Price                                           $9.98              -             -
     Number of Units                                     16,671              -             -
     With Any Two Optional Benefits
     Unit Price                                           $9.98              -             -
     Number of Units                                      5,947              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------

                                                     Year Ended December 31,
- -------------------------------------------------- ------------- -------------- -------------
Sub-account                                            2002          2001           2000
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
AST Alger All-Cap Growth (2000)
     With No Optional Benefits
     Unit Price                                           $4.53           7.14          8.68
     Number of Units                                     61,001         56,649        30,915
     With One Optional Benefit
     Unit Price                                           $9.37              -             -
     Number of Units                                      1,959              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
AST Gabelli All-Cap Value (2000)
     With No Optional Benefits
     Unit Price                                           $7.61           9.72         10.07
     Number of Units                                     38,982         26,857        12,895
     With One Optional Benefit
     Unit Price                                          $10.05              -             -
     Number of Units                                      2,516              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
AST T. Rowe Price Natural Resources (1995)
     With No Optional Benefits
     Unit Price                                          $10.42          11.18         11.24
     Number of Units                                      4,994          1,879           -0-
     With One Optional Benefit
     Unit Price                                          $10.44              -             -
     Number of Units                                      1,940              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
AST Alliance Growth 12 (1996)
     With No Optional Benefits
     Unit Price                                           $4.86           7.12          8.46
     Number of Units                                    106,056        106,762        97,356
     With One Optional Benefit
     Unit Price                                           $9.35              -             -
     Number of Units                                      1,038              -             -
     With Any Two Optional Benefits
     Unit Price                                           $9.34              -             -
     Number of Units                                        618              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
AST MFS Growth (1999)
     With No Optional Benefits
     Unit Price                                           $5.31           7.48          9.68
     Number of Units                                    112,701         47,656         3,089
     With One Optional Benefit
     Unit Price                                           $9.47              -             -
     Number of Units                                     18,241              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------

                                                     Year Ended December 31,
- -------------------------------------------------- ------------- -------------- -------------
Sub-account                                            2002          2001           2000
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
AST Marsico Capital Growth (1997)
     With No Optional Benefits
     Unit Price                                           $6.50           7.80         10.09
     Number of Units                                    228,033        182,904       114,992
     With One Optional Benefit
     Unit Price                                           $9.52              -             -
     Number of Units                                     78,038              -             -
     With Any Two Optional Benefits
     Unit Price                                           $9.52              -             -
     Number of Units                                     26,662              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
AST Goldman Sachs Concentrated Growth 13 (1992)
     With No Optional Benefits
     Unit Price                                           $3.69           5.33          7.90
     Number of Units                                    405,437        404,404       235,747
     With One Optional Benefit
     Unit Price                                           $9.47              -             -
     Number of Units                                      1,309              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
AST DeAm Large-Cap Growth 8 (2002)
     With No Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With One Optional Benefit
     Unit Price                                           $9.65              -             -
     Number of Units                                      5,883              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
AST DeAm Large-Cap Value 14 (2000)
     With No Optional Benefits
     Unit Price                                           $7.67           9.17          9.83
     Number of Units                                      7,126          1,696           442
     With One Optional Benefit
     Unit Price                                           $9.98              -             -
     Number of Units                                      4,779              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
AST Alliance/Bernstein Growth + Value (2001)
     With No Optional Benefits
     Unit Price                                           $7.14           9.64             -
     Number of Units                                     37,810            -0-             -
     With One Optional Benefit
     Unit Price                                           $9.79              -             -
     Number of Units                                      2,021              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------

                                                     Year Ended December 31,
- -------------------------------------------------- ------------- -------------- -------------
Sub-account                                            2002          2001           2000
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
AST AST Sanford Bernstein Core Value (2001)
     With No Optional Benefits
     Unit Price                                           $8.61          10.05             -
     Number of Units                                     82,054         18,453             -
     With One Optional Benefit
     Unit Price                                          $10.09              -             -
     Number of Units                                     65,721              -             -
     With Any Two Optional Benefits
     Unit Price                                          $10.08              -             -
     Number of Units                                     25,273              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
AST Cohen & Steers Realty (1998)
     With No Optional Benefits
     Unit Price                                          $11.91          11.75         11.57
     Number of Units                                     25,464         16,487        16,557
     With One Optional Benefit
     Unit Price                                          $10.33              -             -
     Number of Units                                      1,341              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
AST Sanford Bernstein Managed Index 500 15 (1998)
     With No Optional Benefits
     Unit Price                                           $6.59           8.41          9.46
     Number of Units                                     90,506         39,414         9,941
     With One Optional Benefit
     Unit Price                                           $9.81              -             -
     Number of Units                                      3,351              -             -
     With Any Two Optional Benefits
     Unit Price                                           $9.81              -             -
     Number of Units                                        681              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
AST American Century Income & Growth 16 (1997)
     With No Optional Benefits
     Unit Price                                           $6.70           8.47          9.36
     Number of Units                                    124,168        113,372        70,887
     With One Optional Benefit
     Unit Price                                           $9.90              -             -
     Number of Units                                        813              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
AST Alliance Growth and Income 17 (1992)
     With No Optional Benefits
     Unit Price                                           $7.84          10.35         10.53
     Number of Units                                    142,152        205,232        34,439
     With One Optional Benefit
     Unit Price                                           $9.84              -             -
     Number of Units                                     18,189              -             -
     With Any Two Optional Benefits
     Unit Price                                           $9.83              -             -
     Number of Units                                        717              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------

                                                     Year Ended December 31,
- -------------------------------------------------- ------------- -------------- -------------
Sub-account                                            2002          2001           2000
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
AST MFS Growth with Income (1999)
     With No Optional Benefits
     Unit Price                                           $6.52           8.42         10.09
     Number of Units                                     18,434         18,030         1,919
     With One Optional Benefit
     Unit Price                                           $9.72              -             -
     Number of Units                                        809              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
AST INVESCO Capital Income 18 (1994)
     With No Optional Benefits
     Unit Price                                           $7.59           9.31         10.32
     Number of Units                                     44,419         44,212         8,596
     With One Optional Benefit
     Unit Price                                           $9.90              -             -
     Number of Units                                      5,087              -             -
     With Any Two Optional Benefits
     Unit Price                                           $9.90              -             -
     Number of Units                                        200              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
AST DeAM Global Allocation 19 (1993)
     With No Optional Benefits
     Unit Price                                           $7.38           8.84         10.14
     Number of Units                                     34,451         38,208        30,678
     With One Optional Benefit
     Unit Price                                           $9.94              -             -
     Number of Units                                         67              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
AST American Century Strategic Balanced (1997)
     With No Optional Benefits
     Unit Price                                           $8.36           9.38          9.87
     Number of Units                                      5,490          4,905         1,725
     With One Optional Benefit
     Unit Price                                           $9.97              -             -
     Number of Units                                      2,914              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
AST T. Rowe Price Asset Allocation (1994)
     With No Optional Benefits
     Unit Price                                           $8.47           9.52         10.12
     Number of Units                                     13,799         13,152         2,412
     With One Optional Benefit
     Unit Price                                           $9.97              -             -
     Number of Units                                      4,012              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------

                                                     Year Ended December 31,
- -------------------------------------------------- ------------- -------------- -------------
Sub-account                                            2002          2001           2000
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
AST T. Rowe Price Global Bond 20 (1994)
     With No Optional Benefits
     Unit Price                                          $12.32          10.84         10.70
     Number of Units                                     36,987         16,390           -0-
     With One Optional Benefit
     Unit Price                                          $10.32              -             -
     Number of Units                                      2,954              -             -
     With Any Two Optional Benefits
     Unit Price                                          $10.31              -             -
     Number of Units                                      4,861              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
AST Federated High Yield (1994)
     With No Optional Benefits
     Unit Price                                           $9.16           9.27          9.37
     Number of Units                                     73,614         45,297        12,929
     With One Optional Benefit
     Unit Price                                          $10.27              -             -
     Number of Units                                      2,990              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
AST Lord Abbett Bond-Debenture (2000)
     With No Optional Benefits
     Unit Price                                          $10.22          10.30         10.13
     Number of Units                                     43,077         16,628           425
     With One Optional Benefit
     Unit Price                                          $10.24              -             -
     Number of Units                                     27,024              -             -
     With Any Two Optional Benefits
     Unit Price                                          $10.23              -             -
     Number of Units                                        274              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
AST DeAM Bond 8 (2002)
     With No Optional Benefits
     Unit Price                                          $10.68              -             -
     Number of Units                                      3,479              -             -
     With One Optional Benefit
     Unit Price                                          $10.16              -             -
     Number of Units                                        188              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
AST PIMCO Total Return Bond (1994)
     With No Optional Benefits
     Unit Price                                          $12.72          11.80         10.97
     Number of Units                                    362,294        275,317        37,918
     With One Optional Benefit
     Unit Price                                          $10.17              -             -
     Number of Units                                     87,940              -             -
     With Any Two Optional Benefits
     Unit Price                                          $10.17              -             -
     Number of Units                                     11,308              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------

                                                     Year Ended December 31,
- -------------------------------------------------- ------------- -------------- -------------
Sub-account                                            2002          2001           2000
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
AST PIMCO Limited Maturity Bond (1995)
     With No Optional Benefits
     Unit Price                                          $10.09          11.29         10.59
     Number of Units                                     38,260        112,948         1,940
     With One Optional Benefit
     Unit Price                                          $10.09              -             -
     Number of Units                                      3,018              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
AST Money Market (1992)
     With No Optional Benefits
     Unit Price                                          $10.57          10.57         10.32
     Number of Units                                    403,604        179,509        29,567
     With One Optional Benefit
     Unit Price                                           $9.99              -             -
     Number of Units                                     69,199              -             -
     With Any Two Optional Benefits
     Unit Price                                           $9.99              -             -
     Number of Units                                     11,113              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
Gartmore Variable Investment Trust - GVIT
Developing Markets 9 (1996)
     With No Optional Benefits
     Unit Price                                           $6.71           7.53          8.19
     Number of Units                                      6,530          6,555         3,293
     With One Optional Benefit
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
Wells Fargo Variable Trust - Equity Income (1999)
     With No Optional Benefits
     Unit Price                                          $12.67          15.89         17.01
     Number of Units                                      1,063          1,992           -0-
     With One Optional Benefit
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
INVESCO VIF - Dynamics (1999)
     With No Optional Benefits
     Unit Price                                           $4.57           6.80          9.99
     Number of Units                                     18,808         15,825        22,264
     With One Optional Benefit
     Unit Price                                           $9.71              -             -
     Number of Units                                      1,332              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------

                                                     Year Ended December 31,
- -------------------------------------------------- ------------- -------------- -------------
Sub-account                                            2002          2001           2000
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
INVESCO VIF - Technology (1999)
     With No Optional Benefits
     Unit Price                                           $2.24           4.27          7.98
     Number of Units                                     30,448         35,767        25,984
     With One Optional Benefit
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
INVESCO VIF - Health Sciences (1999)
     With No Optional Benefits
     Unit Price                                           $8.46          11.35         13.14
     Number of Units                                     19,405         27,104        32,969
     With One Optional Benefit
     Unit Price                                           $9.52              -             -
     Number of Units                                        892              -             -
     With Any Two Optional Benefits
     Unit Price                                           $9.52              -             -
     Number of Units                                        223              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
INVESCO VIF - Financial Services (1999)
     With No Optional Benefits
     Unit Price                                           $9.26          11.02         12.38
     Number of Units                                      7,204          8,536         9,786
     With One Optional Benefit
     Unit Price                                           $9.93              -             -
     Number of Units                                        979              -             -
     With Any Two Optional Benefits
     Unit Price                                           $9.92              -             -
     Number of Units                                        190              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
INVESCO VIF - Telecommunications (1999)
     With No Optional Benefits
     Unit Price                                           $1.78           3.66          8.05
     Number of Units                                     26,718         16,854        20,235
     With One Optional Benefit
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
Evergreen VA - Global Leaders (1999)
     With No Optional Benefits
     Unit Price                                           $6.70           8.51          9.96
     Number of Units                                      6,031         12,525           350
     With One Optional Benefit
     Unit Price                                           $9.67              -             -
     Number of Units                                        797              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------

                                                     Year Ended December 31,
- -------------------------------------------------- ------------- -------------- -------------
Sub-account                                            2002          2001           2000
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
Evergreen VA - Special Equity (1999)
     With No Optional Benefits
     Unit Price                                           $6.10           8.49          9.35
     Number of Units                                      5,427          5,085           -0-
     With One Optional Benefit
     Unit Price                                           $9.86              -             -
     Number of Units                                        295              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
Evergreen VA - Omega (2000)
     With No Optional Benefits
     Unit Price                                               -           9.04             -
     Number of Units                                          -            -0-             -
     With One Optional Benefit
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
ProFund VP - Europe 30 (1999)
     With No Optional Benefits
     Unit Price                                           $5.11           6.97          9.30
     Number of Units                                      2,539          7,317           -0-
     With One Optional Benefit
     Unit Price                                           $9.70              -             -
     Number of Units                                         69              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
ProFund VP - Asia 30 8 (2002)
     With No Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With One Optional Benefit
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
ProFund VP - Japan 8 (2002)
     With No Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With One Optional Benefit
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------

                                                     Year Ended December 31,
- -------------------------------------------------- ------------- -------------- -------------
Sub-account                                            2002          2001           2000
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
ProFund VP - Banks 8 (2002)
     With No Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With One Optional Benefit
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
ProFund VP - Basic Materials 8 (2002)
     With No Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With One Optional Benefit
     Unit Price                                          $10.35              -             -
     Number of Units                                         70              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
ProFund VP - Biotechnology (2001)
     With No Optional Benefits
     Unit Price                                           $5.17           8.38             -
     Number of Units                                        460          3,279             -
     With One Optional Benefit
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
ProFund VP - Consumer Cyclical 8 (2002)
     With No Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With One Optional Benefit
     Unit Price                                           $9.38              -             -
     Number of Units                                        686              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
ProFund VP - Consumer Non-Cyclical 8 (2002)
     With No Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With One Optional Benefit
     Unit Price                                           $9.91              -             -
     Number of Units                                         74              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------

                                                     Year Ended December 31,
- -------------------------------------------------- ------------- -------------- -------------
Sub-account                                            2002          2001           2000
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
ProFund VP - Energy (2001)
     With No Optional Benefits
     Unit Price                                               -           9.20             -
     Number of Units                                          -            -0-             -
     With One Optional Benefit
     Unit Price                                          $10.12              -             -
     Number of Units                                        641              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
ProFund VP - Financial (2001)
     With No Optional Benefits
     Unit Price                                           $7.76           9.23             -
     Number of Units                                      3,258          8,154             -
     With One Optional Benefit
     Unit Price                                           $9.85              -             -
     Number of Units                                         73              -             -
     With Any Two Optional Benefits
     Unit Price                                           $9.84              -             -
     Number of Units                                        401              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
ProFund VP - Healthcare (2001)
     With No Optional Benefits
     Unit Price                                           $7.15           9.37             -
     Number of Units                                      1,235          2,564             -
     With One Optional Benefit
     Unit Price                                           $9.60              -             -
     Number of Units                                      1,177              -             -
     With Any Two Optional Benefits
     Unit Price                                           $9.60              -             -
     Number of Units                                        416              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
ProFund VP - Industrial 8 (2002)
     With No Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With One Optional Benefit
     Unit Price                                          $10.21              -             -
     Number of Units                                         72              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
ProFund VP - Internet 8 (2002)
     With No Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With One Optional Benefit
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------

                                                     Year Ended December 31,
- -------------------------------------------------- ------------- -------------- -------------
Sub-account                                            2002          2001           2000
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
ProFund VP - Pharmaceuticals 8 (2002)
     With No Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With One Optional Benefit
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
ProFund VP - Precious Metals 8 (2002)
     With No Optional Benefits
     Unit Price                                           $9.73              -             -
     Number of Units                                      1,179              -             -
     With One Optional Benefit
     Unit Price                                          $11.31              -             -
     Number of Units                                         65              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
ProFund VP - Real Estate (2001)
     With No Optional Benefits
     Unit Price                                          $10.65          10.78             -
     Number of Units                                      2,230          2,306             -
     With One Optional Benefit
     Unit Price                                          $10.21              -             -
     Number of Units                                         73              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
ProFund VP -Semiconductor 8 (2002)
     With No Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With One Optional Benefit
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
ProFund VP - Technology (2001)
     With No Optional Benefits
     Unit Price                                               -           5.92             -
     Number of Units                                          -         12,704             -
     With One Optional Benefit
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------

                                                     Year Ended December 31,
- -------------------------------------------------- ------------- -------------- -------------
Sub-account                                            2002          2001           2000
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
ProFund VP - Telecommunications (2001)
     With No Optional Benefits
     Unit Price                                               -           7.11             -
     Number of Units                                          -            -0-             -
     With One Optional Benefit
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
ProFund VP - Utilities (2001)
     With No Optional Benefits
     Unit Price                                           $6.11           8.13             -
     Number of Units                                        491            -0-             -
     With One Optional Benefit
     Unit Price                                          $10.62              -             -
     Number of Units                                        836              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
ProFund VP - Bull 8 (2002)
     With No Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With One Optional Benefit
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
ProFund VP - Bear (2001)
     With No Optional Benefits
     Unit Price                                          $13.78          11.55             -
     Number of Units                                      2,012            -0-             -
     With One Optional Benefit
     Unit Price                                          $10.14              -             -
     Number of Units                                        658              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
ProFund VP - UltraBull 22 (2001)
     With No Optional Benefits
     Unit Price                                           $4.72           7.48             -
     Number of Units                                      2,988            -0-             -
     With One Optional Benefit
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------

                                                     Year Ended December 31,
- -------------------------------------------------- ------------- -------------- -------------
Sub-account                                            2002          2001           2000
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
ProFund VP - OTC (2001)
     With No Optional Benefits
     Unit Price                                               -           5.77             -
     Number of Units                                          -            -0-             -
     With One Optional Benefit
     Unit Price                                           $9.36              -             -
     Number of Units                                        205              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
ProFund VP - Short OTC 8 (2002)
     With No Optional Benefits
     Unit Price                                          $11.03              -             -
     Number of Units                                        934              -             -
     With One Optional Benefit
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
ProFund VP - UltraOTC (1999)
     With No Optional Benefits
     Unit Price                                               -           1.25          4.06
     Number of Units                                          -         58,556         3,787
     With One Optional Benefit
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
ProFund VP - Mid-Cap Value 8 (2002)
     With No Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With One Optional Benefit
     Unit Price                                          $10.07              -             -
     Number of Units                                      2,821              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
ProFund VP - Mid-Cap Growth 8 (2002)
     With No Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With One Optional Benefit
     Unit Price                                           $9.82              -             -
     Number of Units                                      2,879              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------

                                                     Year Ended December 31,
- -------------------------------------------------- ------------- -------------- -------------
Sub-account                                            2002          2001           2000
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
ProFund VP - UltraMid-Cap 8 (2002)
     With No Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With One Optional Benefit
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
ProFund VP - Small-Cap Value 8 (2002)
     With No Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With One Optional Benefit
     Unit Price                                          $10.15              -             -
     Number of Units                                        568              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
ProFund VP - Small-Cap Growth 8 (2002)
     With No Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With One Optional Benefit
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
ProFund VP - UltraSmall-Cap 23 (1999)
     With No Optional Benefits
     Unit Price                                           $4.82           8.50          9.32
     Number of Units                                        953            -0-         3,174
     With One Optional Benefit
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
ProFund VP - U.S. Government Plus 8 (2002)
     With No Optional Benefits
     Unit Price                                          $11.59              -             -
     Number of Units                                      1,005              -             -
     With One Optional Benefit
     Unit Price                                          $10.20              -             -
     Number of Units                                        592              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------

                                                     Year Ended December 31,
- -------------------------------------------------- ------------- -------------- -------------
Sub-account                                            2002          2001           2000
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
ProFund VP - Rising Rates Opportunity 8 (2002)
     With No Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With One Optional Benefit
     Unit Price                                           $9.70              -             -
     Number of Units                                      3,456              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
First Trust(R)10 Uncommon Values (2000)
     With No Optional Benefits
     Unit Price                                           $2.95           4.73          7.44
     Number of Units                                     23,080         31,543        32,451
     With One Optional Benefit
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------
- -------------------------------------------------- ------------- -------------- -------------
Prudential - SP Jennison International Growth
(2001)
     With No Optional Benefits
     Unit Price                                           $5.64           7.40             -
     Number of Units                                      1,341            -0-             -
     With One Optional Benefit
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With Any Two Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
     With All Optional Benefits
     Unit Price                                               -              -             -
     Number of Units                                          -              -             -
- -------------------------------------------------- ------------- -------------- -------------


1.       Effective December 10, 2001, Strong Capital  Management,  Inc. became  Sub-advisor of the Portfolio.  Prior to December 10,
     2001, A I M Capital  Management,  Inc.  served as  Sub-advisor  of the Portfolio,  then named "AST AIM  International  Equity."
     Between October 15, 1996 and May 3, 1999,  Putnam  Investment  Management,  Inc.  served as Sub-advisor of the Portfolio,  then
     named "AST Putnam  International  Equity."  Prior to October 15, 1996,  Seligman  Henderson  Co. served as  Sub-advisor  of the
     Portfolio, then named "Seligman Henderson International Equity Portfolio."
2.       Effective November 11, 2002,  William Blair & Company,  L.L.C.  became Sub-advisor of the Portfolio.  Prior to November 11,
     2002, Janus Capital Corporation served as Sub-advisor of the Portfolio, then named "AST Janus Overseas Growth."
3.       This  Portfolio  reflects the  addition of the net assets of the AST American  Century  International  Growth  Portfolio II
     ("Portfolio II") as a result of the merger between the Portfolio and Portfolio II.
4.       Effective  May 1, 2002,  Deutsche  Asset  Management,  Inc.  became  Sub-advisor  of the  Portfolio.  Prior to May 1, 2002,
     Founders Asset Management,  Inc. served as Sub-advisor of the Portfolio,  then named "AST Founders  Passport." Prior to October
     15, 1996,  Seligman Henderson Co. served as Sub-advisor of the Portfolio,  then named "Seligman  Henderson  International Small
     Cap Portfolio."
5.       Effective  September 17, 2001, Pilgrim Baxter & Associates,  Ltd. became  Sub-advisor of the Portfolio.  Prior to September
     17, 2001, Janus Capital  Corporation served as Sub-advisor of the Portfolio,  then named "AST Janus Small-Cap Growth." Prior to
     December 31, 1998,  Founders  Asset  Management,  LLC served as  Sub-advisor of the  Portfolio,  then named  "Founders  Capital
     Appreciation Portfolio."
6.       Effective December 10, 2001,  Deutsche Asset Management,  Inc. became  Sub-advisor of the Portfolio.  Prior to December 10,
     2001,  Zurich Scudder  Investments,  Inc.  served as Sub-advisor of the  Portfolio,  then named "AST Scudder  Small-Cap  Growth
     Portfolio".  Prior to May 1, 2001, the Portfolio was named "AST Kemper Small-Cap Growth Portfolio."
7.       Effective  October 23, 2000,  GAMCO  Investors,  Inc.  became  Sub-advisor of the Portfolio.  Prior to October 23, 2000, T.
     Rowe Price  Associates,  Inc.  served as  Sub-advisor  of the  Portfolio,  then named "AST T. Rowe Price  Small  Company  Value
     Portfolio."
8.       These portfolios were first offered as Sub-accounts on May 1, 2002.
9.       The condensed  financial  information of this Gartmore  Variable  Investment Trust portfolio  relates to prior periods when
     such  portfolio was a portfolio of Montgomery  Variable  Series.  Pursuant to a shareholder  vote,  effective June 20, 2003 the
     Montgomery Variable Series - Emerging Markets Portfolio  transferred its assets to the GVIT Developing Markets Portfolio of the
     Gartmore Variable Investment Trust.
10.      Effective  November 11, 2002,  Goldman Sachs Asset Management  became  Sub-advisor of the Portfolio.  Prior to November 11,
     2002, Janus Capital Corporation served as Sub-advisor of the Portfolio, then named "AST Janus Mid-Cap Growth."
11.      Effective May 1, 1998,  Neuberger  Berman  Management,  Inc.  became  Sub-advisor of the  Portfolio.  Prior to May 1, 1998,
     Berger Associates, Inc. served as Sub-advisor of the Portfolio, then named "Berger Capital Growth Portfolio."
12.      Effective May 1, 1998,  Neuberger  Berman  Management,  Inc.  became  Sub-advisor of the  Portfolio.  Prior to May 1, 1998,
     Federated Investment Counseling served as Sub-advisor of the Portfolio, then named "Federated Utility Income Portfolio."
13.      Effective May 1, 2000,  Alliance Capital  Management,  L.P. became Sub-advisor of the Portfolio.  Between December 31, 1998
     and May 1, 2000,  OppenheimerFunds,  Inc. served as Sub-advisor of the Portfolio,  then named "AST Oppenheimer Large-Cap Growth
     Portfolio." Prior to December 31, 1998,  Robertson,  Stephens & Company  Investment  Management,  L.P. served as Sub-advisor of
     the Portfolio, then named "Robertson Stephens Value + Growth Portfolio."
14.      Effective  November 11, 2002,  Goldman Sachs Asset Management  became  Sub-advisor of the Portfolio.  Prior to November 11,
     2002, Janus Capital Corporation served as Sub-advisor of the Portfolio, then named "AST JanCap Growth."
15.      Effective May 1, 2002,  Deutsche Asset Management,  Inc. became  Sub-advisor of the Portfolio.  Prior to May 1, 2002, Janus
     Capital Corporation served as Sub-advisor of the Portfolio, then named "AST Janus Strategic Value."
16.      Effective  May 1, 2000,  Sanford C.  Bernstein & Co.,  Inc.  became  Sub-advisor  of the  Portfolio.  Prior to May 1, 2000,
     Bankers Trust Company served as Sub-advisor of the Portfolio, then named "AST Bankers Trust Managed Index 500 Portfolio."
17.      Effective May 3, 1999, American Century Investment  Management,  Inc. became Sub-advisor of the Portfolio.  Between October
     15, 1996 and May 3, 1999, Putnam  Investment  Management,  Inc. served as Sub-advisor of the Portfolio,  then named "AST Putnam
     Value Growth & Income."
18.      Effective May 1, 2000,  Alliance  Capital  Management,  L.P.  became  Sub-advisor of the  Portfolio.  Prior to May 1, 2000,
     Lord, Abbett & Co. served as Sub-advisor of the Portfolio, then named "AST Lord Abbett Growth and Income Portfolio."
19.      Effective July 1, 2002, the AST INVESCO Equity Income portfolio changed its name to AST INVESCO Capital Income.
20.      Effective May 1, 2002,  Deutsche Asset Management,  Inc. became  Sub-advisor of the Portfolio.  Prior to May 1, 2002, A I M
     Capital  Management,  Inc. served as Sub-advisor of the Portfolio,  then named "AST AIM Balanced." Between October 15, 1996 and
     May 3, 1999,  Putnam  Investment  Management,  Inc. served as Sub-advisor of the Portfolio,  then named "AST Putnam  Balanced."
     Prior to October 15, 1996, Phoenix  Investment  Counsel,  Inc. served as Sub-advisor of the Portfolio,  then named "AST Phoenix
     Balanced Asset Portfolio."
21.      Effective August 8, 2000, T. Rowe Price  International,  Inc. became  Sub-advisor of the Portfolio.  Effective May 1, 2000,
     the name of the  Portfolio  was changed to the "AST T. Rowe Price  Global  Bond".  Effective  May 1, 1996,  Rowe  Price-Fleming
     International,  Inc.  became  Sub-advisor of the Portfolio.  Prior to May 1, 1996,  Scudder,  Stevens & Clark,  Inc.  served as
     Sub-advisor of the Portfolio, then named "AST Scudder International Bond Portfolio."
22.      Effective  May 1, 2003,  the ProFunds VP Bull Plus  portfolio  changed its name to ProFund VP UltraBull to reflect a change
     in its investment objective.
23.      Prior to May 1, 2000,  ProFund VP UltraSmall-Cap  was named "ProFund VP Small Cap" and sought daily investment results that
     corresponded to the performance of the Russell 2000(R)Index.



                                        APPENDIX C - CALCULATION OF OPTIONAL DEATH BENEFITS

Examples of Enhanced Beneficiary Protection Optional Death Benefit Calculation
The following are examples of how the Enhanced  Beneficiary  Protection  Optional Death Benefit is calculated.  Each example assumes
that a $50,000  initial  Purchase  Payment is made. Each example assumes that there is one Owner who is age 50 on the Issue Date and
that all Account  Value is maintained in the variable  investment  options.  The formula for  determining  the Enhanced  Beneficiary
Protection Optional Death Benefit is as follows:

           Growth =               Account Value of variable             minus         Purchase Payments - proportional
                               investment options plus Interim
                                Value of Fixed Allocations (no
                                         MVA applies)                                           withdrawals

Example with market increase
Assume that the Owner has made no withdrawals  and that the Account Value has been  increasing due to positive  market  performance.
On the date we receive  due proof of death,  the  Account  Value is  $75,000.  The basic  Death  Benefit is  calculated  as Purchase
Payments minus proportional  withdrawals,  or Account Value, which ever is greater.  Therefore,  the basic Death Benefit is equal to
$75,000.  The Enhanced  Beneficiary  Protection  Optional Death Benefit is equal to the amount payable under the basic Death Benefit
($75,000) PLUS 40% of the "Growth" under the Annuity.

         Growth   =        $75,000 - [$50,000 - $0]
                  =        $25,000

         Benefit Payable under Enhanced Beneficiary Protection Optional Death Benefit = 40% of Growth
                  =        $25,000 * 0.40
                  =        $10,000

         Benefit Payable under Basic Death Benefit PLUS Enhanced Beneficiary Protection Optional Death Benefit
                  =        $85,000

Examples with market decline
Assume  that the  Owner  has made no  withdrawals  and that  the  Account  Value  has been  decreasing  due to  declines  in  market
performance.  On the date we receive due proof of death,  the Account  Value is $45,000.  The basic Death  Benefit is  calculated as
Purchase Payments minus proportional  withdrawals,  or Account Value, which ever is greater.  Therefore,  the basic Death Benefit is
equal to $50,000.  The Enhanced  Beneficiary  Protection Optional Death Benefit is equal to the amount payable under the basic Death
Benefit ($50,000) PLUS the "Growth" under the Annuity.

         Growth   =        $45,000 - [$50,000 - $0]
                  =        $-5,000

         Benefit Payable under Enhanced Beneficiary Protection Optional Death Benefit = 40% of Growth
                  NO BENEFIT IS PAYABLE

         Benefit Payable under Basic Death Benefit PLUS Enhanced Beneficiary Protection Optional Death Benefit
                  =        $50,000

In this example you would receive no additional benefit from purchasing the Enhanced Beneficiary Protection Optional Death Benefit.


Example with market increase and withdrawals
Assume that the Account Value has been increasing due to positive  market  performance and the Owner made a withdrawal of $15,000 in
Annuity Year 5 when the Account  Value was $75,000.  On the date we receive due proof of death,  the Account  Value is $90,000.  The
basic Death Benefit is calculated as Purchase  Payments minus  proportional  withdrawals,  or Account Value,  which ever is greater.
Therefore,  the basic Death Benefit is equal to $90,000.  The Enhanced  Beneficiary  Protection  Optional  Death Benefit is equal to
the amount payable under the basic Death Benefit ($90,000) PLUS 40% of the "Growth" under the Annuity.

         Growth   =        $90,000 - [$50,000 - ($50,000 * $15,000/$75,000)]
                  =        $90,000 - [$50,000 - $10,000]
                  =        $90,000 - $40,000
                  =        $50,000

         Benefit Payable under Enhanced Beneficiary Protection Optional Death Benefit = 40% of Growth
                  =        $50,000 * 0.40
                  =        $20,000

         Benefit Payable under Basic Death Benefit PLUS Enhanced Beneficiary Protection Optional Death Benefit
                  =        $110,000

Examples of Highest Anniversary Value Death Benefit Calculation
The  following  are examples of how the Highest  Anniversary  Value Death  Benefit is  calculated.  Each example  assumes an initial
Purchase  Payment of  $50,000.  Each  example  assumes  that there is one Owner who is age 70 on the Issue Date and that all Account
Value is maintained in the variable investment options.

Example with market increase and death before Death Benefit Target Date
Assume that the Owner's  Account Value has generally been  increasing  due to positive  market  performance  and that no withdrawals
have been made.  On the date we receive due proof of death,  the Account Value is $75,000;  however,  the  Anniversary  Value on the
5th  anniversary  of the Issue Date was $90,000.  Assume as well that the Owner has died before the Death Benefit  Target Date.  The
Death Benefit is equal to the greater of the Highest  Anniversary  Value or the basic Death Benefit.  The Death Benefit would be the
Highest  Anniversary  Value  ($90,000)  because it is greater  than the amount  that would have been  payable  under the basic Death
Benefit ($75,000).

Example with withdrawals
Assume that the Account Value has been increasing due to positive  market  performance and the Owner made a withdrawal of $15,000 in
Annuity  Year 7 when the  Account  Value was  $75,000.  On the date we receive  due proof of death,  the  Account  Value is $80,000;
however,  the  Anniversary  Value on the 5th  anniversary  of the  Issue  Date was  $90,000.  Assume as well that the Owner has died
before the Death  Benefit  Target  Date.  The Death  Benefit is equal to the greater of the Highest  Anniversary  Value or the basic
Death Benefit.

Highest Anniversary Value  = $90,000 - [$90,000 * $15,000/$75,000]
                                    = $90,000 - $18,000
                                    = $72,000

Basic Death Benefit                 = $80,000 - [$80,000 * $15,000/$75,000]
                                    = $80,000 - $16,000
                                    = $64,000

Example with death after Death Benefit Target Date
Assume that the Owner's Account Value has generally been  increasing due to positive market  performance and that no withdrawals had
been made prior to the Death  Benefit  Target Date.  Further  assume that the Owner dies after the Death Benefit  Target Date,  when
the Account Value is $75,000.  The Highest  Anniversary Value on the Death Benefit Target Date was $80,000;  however,  following the
Death  Benefit  Target  Date,  the Owner made a Purchase  Payment of $15,000 and had taken a  withdrawal  of $5,000 when the Account
Value was  $70,000.  The Death  Benefit is equal to the  greater of the  Highest  Anniversary  Value plus  Purchase  Payments  minus
proportional withdrawals after the Death Benefit Target Date or the basic Death Benefit.

Highest Anniversary Value  = $80,000 + $15,000 - [$80,000 * $5,000/$70,000]
                                    = $80,000 + $15,000 - $5,714
                                    = $100,714

Basic Death Benefit                 = $75,000

                                               THIS PAGE IS INTENTIONALLY LEFT BLANK.

- -------------------------------------------------------------------------------------------------------------------
                  PLEASE SEND ME A STATEMENT OF  ADDITIONAL  INFORMATION  THAT CONTAINS  FURTHER  DETAILS ABOUT THE
                  AMERICAN SKANDIA ANNUITY DESCRIBED IN PROSPECTUS WFVASAPIII-PROS (12/2003).
- -------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------

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


                                       _______________________________________________________
                                                          (print your name)



                                       _______________________________________________________
                                                              (address)



                                       _______________________________________________________
                                                        (city/state/zip code)



                                                                NOTES

Variable Annuity Issued by:                                                                  Variable Annuity Distributed by:

AMERICAN SKANDIA LIFE                                                                                      AMERICAN SKANDIA
ASSURANCE CORPORATION                                                                               MARKETING, INCORPORATED
One Corporate Drive                                                                                     One Corporate Drive
Shelton, Connecticut 06484                                                                       Shelton, Connecticut 06484
Telephone: 1-800-680-8920                                                                           Telephone: 203-926-1888
http://www.americanskandia.prudential.com                                         http://www.americanskandia.prudential.com



                                                         MAILING ADDRESSES:


                                               AMERICAN SKANDIA - VARIABLE ANNUITIES
                                                   Attention: Stagecoach Annuity
                                                           P.O. Box 7040
                                                     Bridgeport, CT 06601-7040



                                                           EXPRESS MAIL:
                                               AMERICAN SKANDIA - VARIABLE ANNUITIES
                                                   Attention: Stagecoach Annuity
                                                        One Corporate Drive
                                                         Shelton, CT 06484


                                                                NOTES
                                                                NOTES
                                                                NOTES
                                                                NOTES
                                                               NOTES






















                                                                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                                                                                        One Corporate Drive, Shelton, Connecticut 06484

This Prospectus  describes  StagecoachTM  APEXSM II, a flexible premium  deferred  annuity (the "Annuity")  offered by American Skandia
Life Assurance  Corporation  ("American  Skandia",  "we", "our" or "us") exclusively  through Wells Fargo Bank, N.A. The Annuity may be
offered as an individual  annuity contract or as an interest in a group annuity.  This Prospectus  describes the important  features of
the Annuity and what you should  consider  before  purchasing  the Annuity.  We have also filed a Statement of  Additional  Information
that is available from us, without  charge,  upon your request.  The contents of the Statement of Additional  Information are described
on page 73. The Annuity or certain of its  investment  options and/or  features may not be available in all states.  Various rights and
benefits may differ  between states to meet  applicable  laws and/or  regulations.  Certain terms are  capitalized in this  Prospectus.
Those terms are either defined in the Glossary of Terms or in the context of the particular section.

=======================================================================================================================================
American  Skandia  offers  several  different  annuities  which your  investment  professional  may be authorized to offer to you. Each
annuity has different  features and benefits that may be appropriate  for you based on your financial  situation,  your age and how you
intend to use the annuity.  The different features and benefits include variations in death benefit  protection,  the ability to access
your  annuity's  account  value and the  charges  that you will be subject  to if you choose to  surrender  the  annuity.  The fees and
charges may also be different between each annuity.
=======================================================================================================================================

If you are purchasing the Annuity as a replacement  for existing  variable  annuity or variable life coverage,  you should consider any
surrender or penalty  charges you may incur when replacing your existing  coverage and that this Annuity may be subject to a contingent
deferred  sales charge if you elect to surrender  the Annuity or take a partial  withdrawal.  You should  consider  your need to access
the Annuity's Account Value and whether the annuity's liquidity features will satisfy that need.

WHY WOULD I CHOOSE TO PURCHASE THIS ANNUITY?
This  Annuity is  frequently  used for  retirement  planning  because it allows you to  accumulate  retirement  savings and also offers
annuity  payment  options when you are ready to begin  receiving  income.  The Annuity also offers one or more death  benefits that can
protect  your  retirement  savings  if you die  during a period of  declining  markets.  It may be used as an  investment  vehicle  for
"qualified"  investments,  including  an IRA,  SEP-IRA,  Roth  IRA or Tax  Sheltered  Annuity  (or  403(b)).  It may also be used as an
investment  vehicle for  "non-qualified"  investments.  The Annuity allows you to invest your money in a number of variable  investment
options as well as in one or more fixed investment options.

When an Annuity is purchased as a  "non-qualified"  investment,  you generally are not taxed on any investment  gains the Annuity earns
until you make a withdrawal or begin to receive annuity payments.  This feature,  referred to as  "tax-deferral",  can be beneficial to
the growth of your  Account  Value  because  money that would  otherwise be needed to pay taxes on  investment  gains each year remains
invested and can earn additional money.  However,  because the Annuity is designed for long-term  retirement savings, a 10% penalty tax
may be applied on withdrawals  you make before you reach age 59 1/2.  Annuities  purchased as a  non-qualified  investment are not subject
to the maximum  contribution  limits that may apply to a qualified  investment,  and are not subject to required minimum  distributions
after age 701/2.

When an Annuity is purchased as a "qualified"  investment,  you should consider that the Annuity does not provide any tax advantages in
addition to the  preferential  treatment  already  available  through your retirement plan under the Internal  Revenue Code. An Annuity
may offer features and benefits in addition to providing tax deferral that other  investment  vehicles may not offer,  including  death
benefit  protection for your  beneficiaries,  lifetime  income options,  and the ability to make transfers  between  numerous  variable
investment  options  offered  under the  Annuity.  You should  consult  with your  investment  professional  as to whether  the overall
benefits and costs of the Annuity are appropriate considering your overall financial plan.

These annuities are NOT deposits or obligations  of, or issued,  guaranteed or endorsed by, any bank, or bank subsidiary of Wells Fargo
Bank,  N.A., are NOT insured or guaranteed by the U.S.  government,  the Federal  Deposit  Insurance  Corporation  (FDIC),  the Federal
Reserve Board or any other agency.  An investment in this annuity involves investment risks, including possible loss of value.
- ---------------------------------------------------------------------------------------------------------------------------------------
THESE  SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE  COMMISSION OR ANY STATE  SECURITIES  COMMISSION
NOR  HAS  THE  COMMISSION  OR ANY  STATE  SECURITIES  COMMISSION  PASSED  UPON  THE  ACCURACY  OR  ADEQUACY  OF  THIS  PROSPECTUS.  ANY
REPRESENTATION  TO THE CONTRARY IS A CRIMINAL  OFFENSE.  PLEASE READ THIS  PROSPECTUS  AND THE CURRENT  PROSPECTUS  FOR THE  UNDERLYING
MUTUAL FUNDS.  KEEP THEM FOR FUTURE REFERENCE.
- ---------------------------------------------------------------------------------------------------------------------------------------
                                             FOR FURTHER INFORMATION CALL 1-800-680-8920.
Prospectus Dated: December 15, 2003                                     Statement of Additional Information Dated: December 15, 2003
WFVAPEXIIPROS- (12/2003)                                                                                               WFVAPEXIIPROS
                             PLEASE SEE OUR PRIVACY POLICY ATTACHED TO THE BACK COVER OF THIS PROSPECTUS.


WHAT ARE SOME OF THE KEY FEATURES OF THIS ANNUITY?

|X|      This  Annuity is a "flexible  premium  deferred  annuity."  It is called  "flexible  premium"  because  you have  considerable
       flexibility in the timing and amount of premium  payments.  Generally,  investors "defer" receiving annuity payments until after
       an accumulation period.

|X|      This Annuity  offers both variable and fixed  investment  options.  If you allocate your Account Value to variable  investment
       options, the value of your Annuity will vary daily to reflect the investment  performance of the underlying  investment options.
       Fixed  investment  options of different  durations are offered that are guaranteed by us, but may have a Market Value Adjustment
       if you withdraw or transfer your Account Value before the Maturity Date.

|X|      The Annuity  features two distinct  periods - the accumulation  period and the payout period.  During the accumulation  period
       your Account Value is allocated to one or more  investment  options.  The variable  investment  options,  each a Sub-account  of
       American  Skandia Life Assurance  Corporation  Variable  Account B, invest in an underlying  mutual fund  portfolio.  Currently,
       portfolios of the following  underlying  mutual funds are being offered:  Wells Fargo Variable  Trust,  American  Skandia Trust,
       Gartmore Variable  Investment Trust,  INVESCO Variable  Investment Funds, Inc.,  Evergreen Variable Annuity Trust,  ProFunds VP,
       First Defined Portfolio Fund LLC and The Prudential Series Fund, Inc.

|X|      During the payout period,  commonly called  "annuitization,"  you can elect to receive annuity  payments (1) for life; (2) for
       life with a guaranteed  minimum number of payments;  (3) based on joint lives;  or (4) for a guaranteed  number of payments.  We
       currently make annuity payments available on a fixed or variable basis.

|X|      This Annuity offers three different optional benefits,  for an additional charge,  that can provide investment  protection for
       Owners while they are alive.

|X|      This  Annuity  offers a basic  Death  Benefit.  It also offers  optional  Death  Benefits  that  provide an enhanced  level of
       protection for your beneficiary(ies) for an additional charge.

|X|      You are  allowed to  withdraw a limited  amount of money from your  Annuity on an annual  basis  without  any  charges.  Other
       product  features  allow you to access your Account Value as necessary,  although a charge may apply.  After Annuity Year 4, you
       are allowed to make unlimited withdrawals from your Annuity without any charges.

|X|      Transfers  between  investment  options are tax-free.  Currently,  you may make twenty transfers each year free of charge.  We
       also offer several  programs that enable you to manage your Account Value as your  financial  needs and  investment  performance
       change.

HOW DO I PURCHASE THIS ANNUITY?
We sell the Annuity  through  licensed,  registered  investment  professionals.  You must complete an application  and submit a minimum
initial  purchase  payment of  $10,000.  We may allow you to make a lower  initial  purchase  payment  provided  you  establish  a bank
drafting program under which purchase  payments  received in the first Annuity Year total at least $10,000.  If the Annuity is owned by
an  individual  or  individuals,  the oldest of those  persons  must be age 85 or under.  If the  Annuity  is owned by an  entity,  the
annuitant must be age 85 or under.




                                                           TABLE OF CONTENTS


GLOSSARY OF TERMS..................................................................................................................5

SUMMARY OF CONTRACT FEES AND CHARGES...............................................................................................6

EXPENSE EXAMPLES..................................................................................................................10

INVESTMENT OPTIONS................................................................................................................11
   WHAT ARE THE INVESTMENT OBJECTIVES AND POLICIES OF THE PORTFOLIOS?.............................................................11
   WHAT ARE THE FIXED INVESTMENT OPTIONS?.........................................................................................27

FEES AND CHARGES..................................................................................................................27
   WHAT ARE THE CONTRACT FEES AND CHARGES?........................................................................................27
   WHAT CHARGES APPLY SOLELY TO THE VARIABLE INVESTMENT OPTIONS?..................................................................28
   WHAT CHARGES ARE ASSESSED BY THE PORTFOLIOS?...................................................................................29
   WHAT CHARGES APPLY TO THE FIXED ALLOCATIONS?...................................................................................29
   WHAT CHARGES APPLY IF I CHOOSE AN ANNUITY PAYMENT OPTION?......................................................................29
   EXCEPTIONS/REDUCTIONS TO FEES AND CHARGES......................................................................................29

PURCHASING YOUR ANNUITY...........................................................................................................29
   WHAT ARE OUR REQUIREMENTS FOR PURCHASING THE ANNUITY?..........................................................................29

MANAGING YOUR ANNUITY.............................................................................................................30
   MAY I CHANGE THE OWNER, ANNUITANT AND BENEFICIARY DESIGNATIONS?................................................................30
   MAY I RETURN THE ANNUITY IF I CHANGE MY MIND?..................................................................................31
   MAY I MAKE ADDITIONAL PURCHASE PAYMENTS?.......................................................................................31
   MAY I MAKE SCHEDULED PAYMENTS DIRECTLY FROM MY BANK ACCOUNT?...................................................................31
   MAY I MAKE PURCHASE PAYMENTS THROUGH A SALARY REDUCTION PROGRAM?...............................................................31

MANAGING YOUR ACCOUNT VALUE.......................................................................................................31
   HOW AND WHEN ARE PURCHASE PAYMENTS INVESTED?...................................................................................31
   ARE THERE RESTRICTIONS OR CHARGES ON TRANSFERS BETWEEN INVESTMENT OPTIONS?.....................................................31
   DO YOU OFFER DOLLAR COST AVERAGING?............................................................................................32
   DO YOU OFFER ANY AUTOMATIC REBALANCING PROGRAMS?...............................................................................33
   DO YOU OFFER ANY ASSET ALLOCATION PROGRAMS?....................................................................................33
   DO YOU OFFER A PROGRAM DESIGNED TO GUARANTEE A "RETURN OF PREMIUM" AT A FUTURE DATE?...........................................33
   MAY I AUTHORIZE MY INVESTMENT PROFESSIONAL TO MANAGE MY ACCOUNT?...............................................................34
   HOW DO THE FIXED INVESTMENT OPTIONS WORK?......................................................................................34
   HOW DO YOU DETERMINE RATES FOR FIXED ALLOCATIONS?..............................................................................35
   HOW DOES THE MARKET VALUE ADJUSTMENT WORK?.....................................................................................35
   WHAT HAPPENS WHEN MY GUARANTEE PERIOD MATURES?.................................................................................36

ACCESS TO ACCOUNT VALUE...........................................................................................................37
   WHAT TYPES OF DISTRIBUTIONS ARE AVAILABLE TO ME?...............................................................................37
   ARE THERE TAX IMPLICATIONS FOR DISTRIBUTIONS?..................................................................................37
   CAN I WITHDRAW A PORTION OF MY ANNUITY?........................................................................................37
   HOW MUCH CAN I WITHDRAW AS A FREE WITHDRAWAL?..................................................................................38
   IS THERE A CHARGE FOR A PARTIAL WITHDRAWAL?....................................................................................38
   CAN I MAKE PERIODIC WITHDRAWALS FROM THE ANNUITY DURING THE ACCUMULATION PERIOD?...............................................39
   DO YOU OFFER A PROGRAM FOR WITHDRAWALS UNDER SECTION 72(t) OF THE INTERNAL REVENUE CODE?.......................................39
   WHAT ARE MINIMUM DISTRIBUTIONS AND WHEN WOULD I NEED TO MAKE THEM?.............................................................39
   CAN I SURRENDER MY ANNUITY FOR ITS VALUE?......................................................................................39
   WHAT IS A MEDICALLY-RELATED SURRENDER AND HOW DO I QUALIFY?....................................................................40
   WHAT TYPES OF ANNUITY OPTIONS ARE AVAILABLE?...................................................................................40
   HOW AND WHEN DO I CHOOSE THE ANNUITY PAYMENT OPTION?...........................................................................41
   HOW ARE ANNUITY PAYMENTS CALCULATED?...........................................................................................41

LIVING BENEFIT PROGRAMS...........................................................................................................42
   DO YOU OFFER PROGRAMS DESIGNED TO PROVIDE INVESTMENT PROTECTION FOR OWNERS WHILE THEY ARE ALIVE?...............................42
   GUARANTEED RETURN OPTION PlusSM (GRO PlusSM)...................................................................................43
   GUARANTEED MINIMUM WITHDRAWAL BENEFIT (GMWB)...................................................................................48
   Additional Tax Considerations for Qualified Contracts..........................................................................52
   GUARANTEED MINIMUM INCOME BENEFIT (GMIB).......................................................................................52
   Other Important Considerations.................................................................................................55

DEATH BENEFIT.....................................................................................................................56
   WHAT TRIGGERS THE PAYMENT OF A DEATH BENEFIT?..................................................................................56
   Basic Death Benefit............................................................................................................56
   OPTIONAL DEATH BENEFITS........................................................................................................56
   AMERICAN SKANDIA'S ANNUITY REWARDS.............................................................................................58
   PAYMENT OF DEATH BENEFITS......................................................................................................59

VALUING YOUR INVESTMENT...........................................................................................................60
   HOW IS MY ACCOUNT VALUE DETERMINED?............................................................................................60
   WHAT IS THE SURRENDER VALUE OF MY ANNUITY?.....................................................................................60
   HOW AND WHEN DO YOU VALUE THE SUB-ACCOUNTS?....................................................................................60
   HOW DO YOU VALUE FIXED ALLOCATIONS?............................................................................................61
   WHEN DO YOU PROCESS AND VALUE TRANSACTIONS?....................................................................................61
   WHAT HAPPENS TO MY UNITS WHEN THERE IS A CHANGE IN DAILY ASSET-BASED CHARGES?..................................................62

TAX CONSIDERATIONS................................................................................................................62
   WHAT ARE SOME OF THE FEDERAL TAX CONSIDERATIONS OF THIS ANNUITY?...............................................................62
   HOW ARE AMERICAN SKANDIA AND THE SEPARATE ACCOUNTS TAXED?......................................................................62
   IN GENERAL, HOW ARE ANNUITIES TAXED?...........................................................................................62
   HOW ARE DISTRIBUTIONS TAXED?...................................................................................................63
   WHAT TAX CONSIDERATIONS ARE THERE FOR TAX-QUALIFIED RETIREMENT PLANS OR QUALIFIED
     CONTRACTS?...................................................................................................................64
   HOW ARE DISTRIBUTIONS FROM QUALIFIED CONTRACTS TAXED?..........................................................................65
   GENERAL TAX CONSIDERATIONS.....................................................................................................66

GENERAL INFORMATION...............................................................................................................67
   HOW WILL I RECEIVE STATEMENTS AND REPORTS?.....................................................................................67
   WHO IS AMERICAN SKANDIA?.......................................................................................................68
   WHAT ARE SEPARATE ACCOUNTS?....................................................................................................68
   WHAT IS THE LEGAL STRUCTURE OF THE UNDERLYING FUNDS?...........................................................................69
   WHO DISTRIBUTES ANNUITIES OFFERED BY AMERICAN SKANDIA?.........................................................................70
   AVAILABLE INFORMATION..........................................................................................................72
   INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE................................................................................72
   HOW TO CONTACT US..............................................................................................................72
   INDEMNIFICATION................................................................................................................73
   LEGAL PROCEEDINGS..............................................................................................................73
   CONTENTS OF THE STATEMENT OF ADDITIONAL INFORMATION............................................................................73

APPENDIX A - FINANCIAL INFORMATION ABOUT AMERICAN SKANDIA..........................................................................1

AUDITED CONSOLIDATED FINANCIAL STATEMENTS OF AMERICAN SKANDIA LIFE ASSURANCE CORPORATION..........................................11

APPENDIX B - CONDENSED FINANCIAL INFORMATION ABOUT SEPARATE ACCOUNT B..............................................................1

APPENDIX C - CALCULATION OF OPTIONAL DEATH BENEFITS................................................................................1




                                                           GLOSSARY OF TERMS

Many terms used  within this  Prospectus  are  described  within the text where they  appear.  The  description  of those terms are not
repeated in this Glossary of Terms.

Account  Value:  The value of each  allocation to a Sub-account  or a Fixed  Allocation  prior to the Annuity Date,  plus any earnings,
and/or less any losses,  distributions  and  charges.  The  Account  Value is  calculated  before we assess any  applicable  Contingent
Deferred Sales Charge  ("CDSC")  and/or any Annual  Maintenance  Fee. The Account Value is determined  separately for each  Sub-account
and for each Fixed  Allocation,  and then totaled to determine  the Account  Value for your entire  Annuity.  The Account Value of each
Fixed Allocation on other than its Maturity Date may be calculated using a market value adjustment.

Annuitization:  The  application  of Account  Value to one of the  available  annuity  options  for the  Annuitant  to begin  receiving
periodic payments for life, for a guaranteed minimum number of payments or for life with a guaranteed minimum number of payments.

Annuity Date: The date you choose for annuity payments to commence.  A maximum Annuity Date may apply.

Annuity Year: A 12-month period commencing on the Issue Date of the Annuity and each successive 12-month period thereafter.

Code: The Internal Revenue Code of 1986, as amended from time to time.

Fixed  Allocation:  An  allocation of Account  Value that is to be credited a fixed rate of interest for a specified  Guarantee  Period
during the accumulation period.

Guarantee Period: A period of time during the accumulation period where we credit a fixed rate of interest on a Fixed Allocation.

Interim  Value:  The value of a Fixed  Allocation on any date other than the Maturity  Date.  The Interim Value is equal to the initial
value  allocated to the Fixed  Allocation  plus all  interest  credited to the Fixed  Allocation  as of the date  calculated,  less any
transfers or withdrawals from the Fixed Allocation.

Issue Date: The effective date of your Annuity.

MVA: A market value  adjustment used in the  determination  of Account Value of each Fixed  Allocation on a day more than 30 days prior
to the Maturity Date of such Fixed Allocation.

Owner:  With an Annuity  issued as an individual  annuity  contract,  the Owner is either an eligible  entity or person named as having
ownership  rights in relation to the Annuity.  With an Annuity  issued as a  certificate  under a group annuity  contract,  the "Owner"
refers to the person or entity who has the rights and benefits designated as to the "Participant" in the certificate.

Surrender  Value:  The value of your Annuity  available upon surrender prior to the Annuity Date. It equals the Account Value as of the
date we price the surrender minus any applicable CDSC, Annual Maintenance Fee, Tax Charge and the charge for any optional benefits.

Unit:  A measure used to calculate your Account Value in a Sub-account during the accumulation period.

Valuation  Day:  Every day the New York Stock  Exchange is open for trading or any other day the  Securities  and  Exchange  Commission
requires mutual funds or unit investment trusts to be valued.

SUMMARY OF CONTRACT FEES AND CHARGES

Below is a summary of the fees and charges for the Annuity.  Some fees and charges are assessed  against your Annuity  while others are
assessed  against  assets  allocated to the variable  investment  options.  The fees and charges that are assessed  against the Annuity
include the  Contingent  Deferred  Sales Charge,  Transfer Fee and Annual  Maintenance  Fee. The charges that are assessed  against the
variable  investment  options are the Insurance  Charge,  which is the combination of a mortality and expense risk charge, a charge for
administration of the Annuity,  and the charge for any optional  benefits you elect.  Each underlying mutual fund portfolio  assesses a
charge for  investment  management,  other expenses and with some mutual funds,  a 12b-1 charge.  The  prospectus  for each  underlying
mutual fund provides more detailed  information  about the expenses for the underlying  mutual funds. Tax charges may vary by state and
in certain  states,  a premium tax charge may be  applicable.  All of these fees and charges are  described in more detail  within this
Prospectus.

The following  table  provides a summary of the fees and charges you will incur if you surrender the Annuity or transfer  Account Value
among investment options.  These fees and charges are described in more detail within this Prospectus.

- ----------------------------------------------------------------------------------------------------------------------------------------
                                                   YOUR TRANSACTION FEES AND CHARGES
- ---------------------------------------------------------------------------------------------------------------------------------------
                                                    (assessed against the Annuity)
- ----------------------------------------------------------------------------------------------------------------------------------------
- ----------------------------------- ----------------------------------------------------------------------------------------------------
            FEE/CHARGE                                                        Amount Deducted
- ----------------------------------- ----------------------------------------------------------------------------------------------------
- -----------------------------------
Contingent Deferred Sales Charge*                                                  8.5%
                                         The charge is a percentage of each applicable Purchase Payment deducted upon surrender or
                                                  withdrawal. The period is measured from the Issue Date of the Annuity.
- ----------------------------------- ----------------------------------------------------------------------------------------------------
- -----------------------------------
Transfer Fee                                                                      $10.00
                                                           (Deducted after the 20th transfer each Annuity Year)
- ----------------------------------- ----------------------------------------------------------------------------------------------------

*    The following are the Contingent  Deferred Sales Charges (as a percentage of each applicable  Purchase  Payment) upon surrender or
withdrawal.

                                        -------- ------ ------ ----- --------
                                        Yr. 1   Yr. 2  Yr. 3  Yr. 4  Yrs. 5+
                                        -------- ------ ------ ----- --------
                                        -------- ------ ------ ----- --------

                                         8.5%    8.0%   7.0%   6.0%   0.0%
                                        -------- ------ ------ ----- --------

The  following  table  provides a summary of the  periodic  fees and charges you will incur while you own the  Annuity,  excluding  the
underlying mutual fund Portfolio annual expenses.  These fees and charges are described in more detail within this Prospectus.

- ----------------------------------------------------------------------------------------------------------------------------------------
                                                    YOUR PERIODIC FEES AND CHARGES
- ----------------------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------- -------------------------------------------- --------------------------------------------
                                                            AMOUNT DEDUCTED/
                 FEE/EXPENSE                              DESCRIPTION OF CHARGE                            WHEN DEDUCTED
- ---------------------------------------------- -------------------------------------------- --------------------------------------------
- ---------------------------------------------- -------------------------------------------- --------------------------------------------
Premium Tax Charge                                 Depends on the requirements of the                         Various
                                                         applicable jurisdiction

============================================== ============================================ ============================================
- ----------------------------------------------------------------------------------------------------------------------------------------
                                           ANNUAL FEES/CHARGES ASSESSED AGAINST THE ANNUITY
- ----------------------------------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------- ------------------------------------------------------------------
                             FEE/CHARGE                                                        Amount Deducted
- --------------------------------------------------------------------- ------------------------------------------------------------------
- --------------------------------------------------------------------- ------------------------------------------------------------------
Annual Maintenance Fee                                                              Smaller of $35 or 2% of Account Value
                                                                          (Only applicable if Account Value is less than $100,000)
                                                                        (Assessed annually on the Annuity's anniversary date or upon
                                                                                                 surrender)
- --------------------------------------------------------------------- ------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------------
                                               ANNUAL FEES/CHARGES OF THE SUB-ACCOUNTS*
                                 (as a percentage of the average daily net assets of the Sub-accounts)
- --------------------------------------------------------------------- ------------------------------------------------------------------
                             FEE/CHARGE                                                        Amount Deducted
- --------------------------------------------------------------------- ------------------------------------------------------------------
Mortality & Expense Risk Charge                                                                     1.50%
- --------------------------------------------------------------------- ------------------------------------------------------------------
Administration Charge                                                                               0.15%
- --------------------------------------------------------------------- ------------------------------------------------------------------
- --------------------------------------------------------------------- ------------------------------------------------------------------
Total Annual Charges of the Sub-accounts**                                     1.65% per year of the value of each Sub-account
- --------------------------------------------------------------------- ------------------------------------------------------------------
*    These charges are deducted daily and apply to Variable Investment Options only.
**   The  combination  of the Mortality and Expense Risk Charges and  Administration  Charge is referred to as the  "Insurance  Charge"
elsewhere in the Prospectus.


The  following  table  provides a summary of the fees and charges you will incur if you elect any of the following  optional  benefits.
These fees and charges are described in more detail within this Prospectus.

- ----------------------------------------------------------------------------------------------------------------------------------------
                                                YOUR OPTIONAL BENEFIT FEES AND CHARGES
- ----------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------- --------------------- ----------------------
                                     Optional Benefit                                         Optional Benefit    Total Annual Charge*
                                                                                                    Fee/
                                                                                                   Charge
- ------------------------------------------------------------------------------------------- --------------------- ----------------------
- ------------------------------------------------------------------------------------------- --------------------- ----------------------
GUARANTEED RETURN OPTION PlusSM (GRO PlusSM) (or GRO where GRO PlusSM is not available)
We offer a program  that  guarantees  a  "return  of  premium"  at a future  date,  while     0.25% of average            1.90%
allowing you to allocate all or a portion of your Account Value to certain Sub-accounts.    daily net assets of
                                                                                              the Sub-accounts
- ------------------------------------------------------------------------------------------- --------------------- ----------------------
- ------------------------------------------------------------------------------------------- --------------------- ----------------------
GUARANTEED MINIMUM WITHDRAWAL BENEFIT (GMWB)
We offer a program that guarantees  your ability to withdraw  amounts equal to an initial     0.35% of average            2.00%
principal value, regardless of the impact of market performance on your Account Value.      daily net assets of
                                                                                              the Sub-accounts
- ------------------------------------------------------------------------------------------- --------------------- ----------------------
- ------------------------------------------------------------------------------------------- --------------------- ----------------------
GUARANTEED MINIMUM INCOME BENEFIT (GMIB)                                                     0.50% per year of            1.65%
We offer a program that,  after a seven-year  waiting period,  guarantees your ability to       the average               PLUS
begin  receiving  income  from your  Annuity in the form of annuity  payments  based on a     Protected Income    0.50% per year of
guaranteed  minimum value (called the "Protected  Income Value") that increases after the     Value; deducted     average Protected
waiting  period  begins,  regardless of the impact of market  performance on your Account   annually in arrears   Income Value
Value.                                                                                       each Annuity Year
- ------------------------------------------------------------------------------------------- --------------------- ----------------------
- ------------------------------------------------------------------------------------------- --------------------- ----------------------
ENHANCED BENEFICIARY PROTECTION DEATH BENEFIT                                                                             1.90%
We offer an Optional  Death  Benefit that provides an enhanced  level of  protection  for     0.25% of average
your  beneficiary(ies)  by providing  amounts in addition to the basic Death Benefit that   daily net assets of
can be used to offset  federal  and state  taxes  payable  on any  taxable  gains in your     the Sub-accounts
Annuity at the time of your death.
- ------------------------------------------------------------------------------------------- --------------------- ----------------------
- ------------------------------------------------------------------------------------------- --------------------- ----------------------
HIGHEST ANNIVERSARY VALUE DEATH BENEFIT
We offer an Optional  Death  Benefit that provides an enhanced  level of  protection  for     0.25% of average
your  beneficiary(ies)  by  providing a death  benefit  equal to the greater of the basic   daily net assets of           1.90%
Death Benefit or the Highest Anniversary Value.                                               the Sub-accounts
- ------------------------------------------------------------------------------------------- --------------------- ----------------------
- ----------------------------------------------------------------------------------------------------------------------------------------
Please  refer to the section of this  Prospectus  that  describes  each  optional  benefit for a complete  description  of the benefit,
including any restrictions or limitations that may apply.
- ----------------------------------------------------------------------------------------------------------------------------------------
*  The Total Annual Charge includes the Insurance Charge assessed against the Annuity.  If you were to elect more than one optional
benefit, the Total Annual Charge would be increased to include the charge for the optional benefit.

The  following  table  provides  the range  (minimum  and  maximum)  of the total  annual  expenses  for the  underlying  mutual  funds
("Portfolios")  as of December  31,  2002.  Each figure is stated as a  percentage  of the  underlying  Portfolio's  average  daily net
assets.

- ----------------------------------------------------------------------------------------------------------------------------------------
                                               Total Annual Portfolio Operating Expenses
- ----------------------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------- -------------------------------------------- --------------------------------------------
                                                                 Minimum                                      Maximum
- ---------------------------------------------- -------------------------------------------- --------------------------------------------
- ---------------------------------------------- -------------------------------------------- --------------------------------------------
Total Portfolio Operating Expense                               0.14 % *                                       3.14%
- ---------------------------------------------- -------------------------------------------- --------------------------------------------
*    The minimum total annual portfolio  operating expenses are those of a Portfolio that may invest in mutual funds, which also charge
     their own operating expenses.  Thus, the total annual portfolio operating expenses may be higher than indicated.

The following are the investment  management fees, other expenses,  12b-1 fees (if applicable),  and the total annual expenses for each
underlying  mutual  fund  ("Portfolio")  as of  December  31,  2002,  except as noted.  Each  figure is stated as a  percentage  of the
underlying  Portfolio's  average daily net assets. For certain of the underlying  Portfolios,  a portion of the management fee is being
waived and/or other  expenses are being  partially  reimbursed.  "N/A"  indicates  that no portion of the  management  fee and/or other
expenses is being waived and/or  reimbursed.  The "Net Annual Portfolio  Operating  Expenses" reflect the combination of the underlying
Portfolio's  investment  management  fee,  other expenses and any 12b-1 fees,  net of any fee waivers and expense  reimbursements.  The
following  expenses are deducted by the underlying  Portfolio  before it provides  American Skandia with the daily net asset value. Any
footnotes  about  expenses  appear after the list of all the  Portfolios.  The  underlying  Portfolio  information  was provided by the
underlying  mutual funds and has not been  independently  verified by us. See the prospectuses or statements of additional  information
of the underlying  Portfolios for further details.  The current  prospectus and statement of additional  information for the underlying
Portfolios can be obtained by calling 1-800-680-8920.


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

                                           UNDERLYING MUTUAL FUND PORTFOLIO ANNUAL EXPENSES
                               (as a percentage of the average net assets of the underlying Portfolios)
- ---------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------- --------------- ------------- -------------- ------------- ------------ -------------
                                                    Management     Other         12b-1 Fees    Total Annual   Fee          Net
                                                       Fees         Expenses                    Portfolio    Waivers       Annual
              UNDERLYING PORTFOLIO                                                              Operating    and           Portfolio
                                                                                                 Expenses    Expense       Operating
                                                                                                             Reimburse-mentExpenses

- ---------------------------------------------------------------------------------------------------------------------------------------
Wells Fargo Variable Trust:
  International Equity                                0.75%          2.14%         0.25%          3.14%        2.14%         1.00%
  Small Cap Growth                                    0.75%          0.33%         0.25%          1.33%        0.13%         1.20%
  Growth                                              0.55%          0.35%         0.25%          1.15%        0.15%         1.00%
  Large Company Growth                                0.55%          0.29%         0.25%          1.09%        0.09%         1.00%
  Equity Value                                        0.55%          0.48%         0.25%          1.28%        0.28%         1.00%
  Equity Income                                       0.55%          0.30%         0.25%          1.10%        0.10%         1.00%
  Asset Allocation                                    0.55%          0.23%         0.25%          1.03%        0.03%         1.00%
  Total Return Bond 1                                 0.45%          0.33%         0.25%          1.03%        0.13%         0.90%

American Skandia Trust: 2
  AST Strong International Equity                     0.88%          0.21%          0.12%         1.21%         0.00%        1.21%
  AST William Blair International Growth              1.00%          0.23%          0.10%         1.33%         0.10%        1.23%
  AST American Century International Growth           1.00%          0.25%          0.00%         1.25%         0.00%        1.25%
  AST DeAM International Equity                       1.00%          0.44%          0.00%         1.44%         0.15%        1.29%
  AST MFS Global Equity                               1.00%          0.41%          0.00%         1.41%         0.00%        1.41%
  AST PBHG Small-Cap Growth                           0.90%          0.22%          0.11%         1.23%         0.00%        1.23%
  AST DeAM Small-Cap Growth                           0.95%          0.20%          0.00%         1.15%         0.15%        1.00%
  AST Federated Aggressive Growth                     0.95%          0.43%          0.00%         1.38%         0.03%        1.35%
  AST Gabelli Small-Cap Value                         0.90%          0.19%          0.01%         1.10%         0.00%        1.10%
  AST DeAM Small-Cap Value                            0.95%          0.53%          0.00%         1.48%         0.33%        1.15%
  AST Goldman Sachs Mid-Cap Growth                    1.00%          0.26%          0.07%         1.33%         0.10%        1.23%
  AST Neuberger Berman Mid-Cap Growth                 0.90%          0.20%          0.06%         1.16%         0.00%        1.16%
  AST Neuberger Berman Mid-Cap Value                  0.90%          0.17%          0.09%         1.16%         0.00%        1.16%
  AST Alger All-Cap Growth                            0.95%          0.19%          0.15%         1.29%         0.00%        1.29%
  AST Gabelli All-Cap Value                           0.95%          0.24%          0.00%         1.19%         0.00%        1.19%
  AST T. Rowe Price Natural Resources                 0.90%          0.23%          0.03%         1.16%         0.00%        1.16%
  AST Alliance Growth                                 0.90%          0.20%          0.03%         1.13%         0.00%        1.13%
  AST MFS Growth                                      0.90%          0.18%          0.10%         1.18%         0.00%        1.18%
  AST Marsico Capital Growth                          0.90%          0.16%          0.04%         1.10%         0.01%        1.09%
  AST Goldman Sachs Concentrated Growth               0.90%          0.15%          0.04%         1.09%         0.06%        1.03%
  AST DeAM Large-Cap Growth                           0.85%          0.23%          0.00%         1.08%         0.10%        0.98%
  AST DeAM Large-Cap Value                            0.85%          0.24%          0.04%         1.13%         0.10%        1.03%
  AST Alliance/Bernstein Growth + Value               0.90%          0.23%          0.00%         1.13%         0.00%        1.13%
  AST Sanford Bernstein Core Value                    0.75%          0.25%          0.00%         1.00%         0.00%        1.00%
  AST Cohen & Steers Realty                           1.00%          0.23%          0.03%         1.26%         0.00%        1.26%
  AST Sanford Bernstein Managed Index 500             0.60%          0.16%          0.08%         0.84%         0.00%        0.84%
  AST American Century Income & Growth                0.75%          0.23%          0.00%         0.98%         0.00%        0.98%
  AST Alliance Growth and Income                      0.75%          0.15%          0.08%         0.98%         0.02%        0.96%
  AST MFS Growth with Income                          0.90%          0.28%          0.01%         1.19%         0.00%        1.19%
  AST INVESCO Capital Income                          0.75%          0.17%          0.03%         0.95%         0.00%        0.95%
  AST DeAM Global Allocation                          0.10%          0.04%          0.00%         0.14%         0.00%        0.14%
  AST American Century Strategic Balanced             0.85%          0.25%          0.00%         1.10%         0.00%        1.10%
  AST T. Rowe Price Asset Allocation                  0.85%          0.26%          0.00%         1.11%         0.00%        1.11%
  AST T. Rowe Price Global Bond                       0.80%          0.26%          0.00%         1.06%         0.00%        1.06%
  AST Federated High Yield                            0.75%          0.19%          0.00%         0.94%         0.00%        0.94%
  AST Lord Abbett Bond-Debenture                      0.80%          0.24%          0.00%         1.04%         0.00%        1.04%
  AST DeAM Bond                                       0.85%          0.23%          0.00%         1.08%         0.15%        0.93%
  AST PIMCO Total Return Bond                         0.65%          0.15%          0.00%         0.80%         0.02%        0.78%
  AST PIMCO Limited Maturity Bond                     0.65%          0.18%          0.00%         0.83%         0.00%        0.83%
- ------------------------------------------------- --------------- ------------- -------------- ------------- ------------ -------------

- ---------------------------------------------------------------------------------------------------------------------------------------
                                           UNDERLYING MUTUAL FUND PORTFOLIO ANNUAL EXPENSES
                               (as a percentage of the average net assets of the underlying Portfolios)
- ---------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------- --------------- ------------- -------------- ------------- ------------ -------------
                                                    Management     Other         12b-1 Fees    Total Annual   Fee          Net
                                                       Fees         Expenses                    Portfolio    Waivers       Annual
              UNDERLYING PORTFOLIO                                                              Operating    and           Portfolio
                                                                                                 Expenses    Expense       Operating
                                                                                                             Reimbursement  Expenses

- ------------------------------------------------- --------------- ------------- -------------- ------------- ------------ -------------
- ------------------------------------------------- --------------- ------------- -------------- ------------- ------------ -------------
  AST Money Market                                    0.50%          0.13%          0.00%         0.63%         0.05%        0.58%

Gartmore Variable Investment Trust:
  GVIT Developing Markets                             1.15%          0.24%           0.25%         1.64%        0.00%        1.64%

INVESCO Variable Investment Funds, Inc.:
  Dynamics                                             0.75%         0.37%           0.00%         1.12%         0.00%        1.12%
  Technology                                           0.75%         0.36%           0.00%         1.11%         0.00%        1.11%
  Health Sciences                                      0.75%         0.32%           0.00%         1.07%         0.00%        1.07%
  Financial Services                                   0.75%         0.34%           0.00%         1.09%         0.00%        1.09%
  Telecommunications                                   0.75%         0.47%           0.00%         1.22%         0.00%        1.22%

Evergreen Variable Annuity Trust:
  International Equity3                                0.66%         0.39%           0.00%         1.05%         0.00%        1.05%
  Special Equity                                       0.92%         0.26%           0.00%         1.18%         0.15%        1.03%
  Omega                                                0.52%         0.18%           0.00%         0.70%         0.00%        0.70%

ProFund VP:
  Europe 30                                            0.75%         1.03%           0.25%         2.03%         0.05%        1.98%
  Asia 30                                              0.75%         1.03%           0.25%         2.03%         0.05%        1.98%
  Japan                                                0.75%         1.06%           0.25%         2.06%         0.08%        1.98%
  Banks                                                0.75%         1.11%           0.25%         2.11%         0.13%        1.98%
  Basic Materials                                      0.75%         1.21%           0.25%         2.21%         0.23%        1.98%
  Biotechnology                                        0.75%         1.16%           0.25%         2.16%         0.18%        1.98%
  Consumer Cyclical                                    0.75%         1.65%           0.25%         2.65%         0.67%        1.98%
  Consumer Non-Cyclical                                0.75%         1.10%           0.25%         2.10%         0.12%        1.98%
  Energy                                               0.75%         1.16%           0.25%         2.16%         0.18%        1.98%
  Financial                                            0.75%         1.14%           0.25%         2.14%         0.16%        1.98%
  Healthcare                                           0.75%         1.14%           0.25%         2.14%         0.16%        1.98%
  Industrial                                           0.75%         1.65%           0.25%         2.65%         0.67%        1.98%
  Internet                                             0.75%         1.04%           0.25%         2.04%         0.06%        1.98%
  Pharmaceuticals                                      0.75%         1.12%           0.25%         2.12%         0.14%        1.98%
  Precious Metals                                      0.75%         0.98%           0.25%         1.98%          N/A         1.98%
  Real Estate                                          0.75%         1.13%           0.25%         2.13%         0.15%        1.98%
  Semiconductor                                        0.75%         1.33%           0.25%         2.33%         0.35%        1.98%
  Technology                                           0.75%         1.27%           0.25%         2.27%         0.29%        1.98%
  Telecommunications                                   0.75%         1.19%           0.25%         2.19%         0.21%        1.98%
  Utilities                                            0.75%         1.17%           0.25%         2.17%         0.19%        1.98%
  Bull                                                 0.75%         0.91%           0.25%         1.91%          N/A         1.91%
  Bear                                                 0.75%         1.03%           0.25%         2.03%         0.05%        1.98%
  UltraBull 4                                          0.75%         1.12%           0.25%         2.12%         0.27%        1.85%
  OTC                                                  0.75%         1.03%           0.25%         2.03%         0.05%        1.98%
  Short OTC                                            0.75%         0.96%           0.25%         1.96%          N/A         1.96%
  UltraOTC                                             0.75%         1.08%           0.25%         2.08%         0.13%        1.95%
  Mid-Cap Value                                        0.75%         1.25%           0.25%         2.25%         0.27%        1.98%
  Mid-Cap Growth                                       0.75%         1.22%           0.25%         2.22%         0.24%        1.98%
  UltraMid-Cap                                         0.75%         1.36%           0.25%         2.36%         0.38%        1.98%
  Small-Cap Value                                      0.75%         1.45%           0.25%         2.45%         0.47%        1.98%
  Small-Cap Growth                                     0.75%         1.20%           0.25%         2.20%         0.22%        1.98%
  UltraSmall-Cap                                       0.75%         1.15%           0.25%         2.15%         0.17%        1.98%
  U.S. Government Plus                                 0.50%         0.96%           0.25%         1.71%          N/A         1.71%
  Rising Rates Opportunity                             0.75%         1.13%           0.25%         2.13%         0.15%        1.98%

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

- ---------------------------------------------------------------------------------------------------------------------------------------
                                           UNDERLYING MUTUAL FUND PORTFOLIO ANNUAL EXPENSES
                               (as a percentage of the average net assets of the underlying Portfolios)
- ---------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------- --------------- ------------- -------------- ------------- ------------ -------------
                                                    Management     Other         12b-1 Fees    Total Annual   Fee          Net
                                                       Fees         Expenses                    Portfolio    Waivers       Annual
              UNDERLYING PORTFOLIO                                                              Operating    and           Portfolio
                                                                                                 Expenses    Expense       Operating
                                                                                                             Reimburse-mentExpenses

- ------------------------------------------------- --------------- ------------- -------------- ------------- ------------ -------------
First Defined Portfolio Fund LLC:
  First Trust(R)10 Uncommon Values                     0.60%          2.29%          0.25%         3.14%         1.95%        1.37%

The Prudential Series Fund, Inc.:
SP Jennison International Growth                       0.85%          0.70%          0.25%         1.80%         0.16%        1.64%
- ------------------------------------------------- --------------- ------------- -------------- ------------- ------------ -------------

1        Effective May 1, 2003, the Wells Fargo Variable  Trust  Corporate Bond portfolio  changed its name to the Wells Fargo Variable
     Trust Total Return Bond portfolio.  The name change was made in conjunction with a change in investment strategy.
2        The  Investment  Manager of  American  Skandia  Trust (the  "Trust")  has agreed to  reimburse  and/or  waive fees for certain
     Portfolios until at least April 30, 2004. The caption "Total Annual Portfolio  Operating  Expenses"  reflects the Portfolios' fees
     and expenses before such waivers and  reimbursements,  while the caption "Net Annual Portfolio  Operating  Expenses"  reflects the
     effect of such waivers and  reimbursements.  The Trust adopted a Distribution Plan (the  "Distribution  Plan") under Rule 12b-1 of
     the Investment Company Act of 1940 to permit an affiliate of the Trust's  Investment  Manager to receive brokerage  commissions in
     connection  with purchases and sales of securities  held by Portfolios of the Trust,  and to use these  commissions to promote the
     sale of shares of such  Portfolios.  While the  brokerage  commission  rates and amounts  paid by the various  Portfolios  are not
     expected to increase as a result of the Distribution Plan, the staff of the Securities and Exchange  Commission takes the position
     that commission amounts received under the Distribution Plan should be reflected as distribution  expenses of the Portfolios.  The
     Distribution  Fee estimates are derived and annualized  from data regarding  commission  amounts  directed under the  Distribution
     Plan.  Although there are no maximum amounts  allowable,  actual commission amounts directed under the Distribution Plan will vary
     and the  amounts  directed  during the last full fiscal year of the Plan's  operations  may differ from the amounts  listed in the
     above chart.
3        On December 5, 2003, all of the assets of the Evergreen  Variable  Annuity Trust Global Leaders  portfolio were transferred to
     the Evergreen  Variable Annuity Trust  International  Equity  portfolio ("the Merger").  The annual expenses are based on what the
     estimated  combined  expenses of the  International  Equity  portfolio  would have been for the 12 months ended June 30, 2003. The
     annual  expenses of the  International  Equity  portfolio prior to the Merger were as follows:  Management Fee: 0.66%;  12b-1 Fee:
     0.00%; Other Expenses 0.73%; Total Annual Portfolio Operating Expenses:  1.39%; Fee Waiver and Expense  Reimbursement:  0.39%; Net
     Annual Portfolio Operating Expenses:  1.00%.
4        Effective  May 1, 2003,  the ProFunds VP Bull Plus  portfolio  changed its name to ProFund VP UltraBull to reflect a change in
     its investment objective.


EXPENSE EXAMPLES

These examples are designed to assist you in  understanding  the various  expenses you may incur with the Annuity over certain  periods
of time based on specific  assumptions.  The  examples  reflect  the  Contingent  Deferred  Sales  Charges  (when  applicable),  Annual
Maintenance Fee (when  applicable),  Insurance  Charge,  and the maximum total annual portfolio  operating  expenses for the underlying
Portfolio  (shown  above),  as well as the charges for the optional  benefits that are offered under the Annuity.  The  Securities  and
Exchange Commission ("SEC") requires these examples.

Below are examples  showing what you would pay in expenses at the end of the stated time periods for each  Sub-account had you invested
$10,000 in the Annuity and received a 5% annual return on assets, and elected all optional benefits available.

The examples  shown assume that:  (a) you only  allocate  Account  Value to the  Sub-account  with the maximum  total annual  portfolio
operating  expenses for the underlying  Portfolio  (shown above),  not to a Fixed  Allocation;  (b) the Insurance Charge is assessed as
1.65% per year; (c) the Annual  Maintenance  Fee (when  applicable) is reflected as an asset-based  charge based on an assumed  average
contract  size;  (d) you make no  withdrawals  of Account  Value  during  the period  shown;  (e) you make no  transfers,  withdrawals,
surrender or other  transactions  for which we charge a fee for during the period  shown;  (f) no tax charge  applies;  (g) the maximum
total annual  portfolio  operating  expenses for the  underlying  Portfolio  (shown above) are  reflected;  and (h) the charge for each
optional benefit is reflected as an additional  charge equal to 0.25% per year,  respectively,  for the Guaranteed  Return Option Plus,
the  Enhanced  Beneficiary  Protection  Death  Benefit and the Highest  Anniversary  Value Death  Benefit and 0.35% for the  Guaranteed
Minimum Withdrawal Benefit.  Amounts shown in the examples are rounded to the nearest dollar.

The Expense Examples do not reflect a charge for the Guaranteed Minimum Income Benefit, which is deducted annually in arrears.

Expense Examples are provided as follows:  1.) if you surrender the Annuity at the end of the stated time period;  2.) if you annuitize
at the end of the stated time period; and 3.) if you do not surrender your Annuity.


THE EXAMPLES ARE  ILLUSTRATIVE  ONLY - THEY SHOULD NOT BE  CONSIDERED A  REPRESENTATION  OF PAST OR FUTURE  EXPENSES OF THE  UNDERLYING
MUTUAL FUNDS OR THEIR  PORTFOLIOS  - ACTUAL  EXPENSES  WILL BE LESS THAN THOSE SHOWN IF YOU DO NOT ELECT ALL OF THE  OPTIONAL  BENEFITS
AVAILABLE OR IF YOU ALLOCATE ACCOUNT VALUE TO ANY OTHER AVAILABLE SUB-ACCOUNTS.

If your Account Value is less than $100,000, so that the Annual Maintenance Fee does apply.  Please see the description below
regarding how the Expense Examples change for Annuities with Account Value greater than $100,000.

If you surrender your contract at the end of the applicable time period:

            ----------------------------- --------------------------- --------------------------- --------------------------
                       1 year                      3 years                     5 years                    10 years
            ----------------------------- --------------------------- --------------------------- --------------------------
            ----------------------------- --------------------------- --------------------------- --------------------------
                       $1,356                       $2,387                      $2,901                     $5,668
            ----------------------------- --------------------------- --------------------------- --------------------------


If you annuitize at the end of the applicable time period:

            ----------------------------- --------------------------- --------------------------- --------------------------
                       1 year                      3 years                     5 years                    10 years
            ----------------------------- --------------------------- --------------------------- --------------------------
            ----------------------------- --------------------------- --------------------------- --------------------------
                        $591                        $1,757                      $2,901                     $5,668
            ----------------------------- --------------------------- --------------------------- --------------------------

If you do not surrender your contract:

            ----------------------------- --------------------------- --------------------------- --------------------------
                       1 year                      3 years                     5 years                    10 years
            ----------------------------- --------------------------- --------------------------- --------------------------
            ----------------------------- --------------------------- --------------------------- --------------------------
                        $591                        $1,757                      $2,901                     $5,668
            ----------------------------- --------------------------- --------------------------- --------------------------


INVESTMENT OPTIONS

WHAT ARE THE INVESTMENT OBJECTIVES AND POLICIES OF THE PORTFOLIOS?

Each variable  investment  option is a Sub-account of American  Skandia Life Assurance  Corporation  Variable  Account B (see "What are
Separate Accounts" for more detailed  information.) Each Sub-account  invests  exclusively in one Portfolio.  You should carefully read
the  prospectus for any Portfolio in which you are  interested.  The following  chart  classifies  each of the Portfolios  based on our
assessment of their  investment  style (as of the date of this  Prospectus).  The chart also provides a description of each Portfolio's
investment  objective  (in  italics)  and a short,  summary  description  of their key  policies  to assist  you in  determining  which
Portfolios may be of interest to you. There is no guarantee that any underlying Portfolio will meet its investment objective.

The name of the  advisor/sub-advisor  for each Portfolio  appears next to the  description.  Those  Portfolios  whose name includes the
prefix "AST" are  Portfolios of American  Skandia Trust.  The investment  managers for AST are American  Skandia  Investment  Services,
Incorporated,  an affiliated  company of American Skandia and Prudential  Investments LLC. However,  a sub-advisor,  as noted below, is
engaged to conduct day-to-day investment decisions.

The Portfolios are not publicly traded mutual funds.  They are only available as investment  options in variable annuity  contracts and
variable life insurance  policies issued by insurance  companies,  or in some cases, to  participants in certain  qualified  retirement
plans.  However,  some of the  Portfolios  available as  Sub-accounts  under the Annuity are managed by the same  portfolio  advisor or
sub-advisor  as a retail  mutual fund of the same or similar  name that the  Portfolio  may have been modeled  after at its  inception.
Certain  retail mutual funds may also have been modeled after a Portfolio.  While the  investment  objective and policies of the retail
mutual funds and the Portfolios may be substantially  similar,  the actual  investments will differ to varying degrees.  Differences in
the  performance  of the funds can be expected,  and in some cases could be  substantial.  You should not compare the  performance of a
publicly  traded  mutual fund with the  performance  of any  similarly  named  Portfolio  offered as a  Sub-account.  Details about the
investment  objectives,  policies,  risks,  costs and  management of the Portfolios  are found in the  prospectuses  for the underlying
mutual  funds.  The current  prospectus  and statement of  additional  information  for the  underlying  Portfolios  can be obtained by
calling 1-800-680-8920.

Please refer to Appendix B for certain required financial information related to the historical performance of the Sub-accounts.

- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      STYLE/                                        INVESTMENT OBJECTIVES/POLICIES                                         PORTFOLIO
       TYPE                                                                                                                 ADVISOR/
                                                                                                                          SUB-ADVISOR
                    ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      INTER-        WFVT International Equity: seeks total return, with an emphasis on capital  appreciation,  over    Wells Fargo Funds
  NATIONAL EQUITY   the  long-term.  The Portfolio  pursues its  objective by investing  primarily in a diversified     Management, LLC
                    portfolio of equity  securities  of  companies  based in developed  non-U.S.  countries  and in
                    emerging markets of the world. Under normal market  conditions,  the Portfolio invests at least
                    80% of its total  assets in equity  securities  of companies  located or operating  outside the
                    U.S. and in a minimum of five  countries  exclusive of the U.S. The  Portfolio may invest up to
                    50% of its total assets in any one country and up to 25% of total  assets in emerging  markets.
                    Generally,  the  Portfolio  invests in issuers  with an average  market  capitalization  of $10
                    billion  or  more,  although  it may  invest  in  equity  securities  of  issuers  with  market
                    capitalization as low as $250 million.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    ------------------------------------------------------------------------------------------------ -----------------------
 SMALL CAP EQUITY   WFVT Small Cap  Growth:  seeks  long-term  capital  appreciation.  The  Portfolio  pursues  its    Wells Fargo Funds
                    objective by investing in a diversified  portfolio of common  stocks issued by companies  whose     Management, LLC
                    market  capitalization  falls with the range of the Russell 2000 Index.  The Portfolio  invests
                    in common stocks of domestic and foreign  companies that the Investment  Advisor  believes have
                    above-average  prospects  for capital  growth,  or that may be  involved  in new or  innovative
                    products,  services and processes.  Under normal market conditions, the Portfolio invests in an
                    actively managed, broadly diversified portfolio of small-cap  growth-oriented common stocks and
                    in at least 20 common stock issues spread across  multiple  industry  groups and sectors of the
                    economy.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    WFVT Growth:  seeks  long-term  capital  appreciation.  The Portfolio  pursues its objective by
                    investing  primarily in common  stocks and other  equity  securities  of companies  that have a
                    strong earnings growth trend that the Investment Advisor believes have above-average  prospects
 LARGE CAP EQUITY   for future  growth.  Under normal  market  conditions,  the  Portfolio  invests at least 65% of
                    total  assets in equity  securities,  including  common and  preferred  stocks  and  securities    Wells Fargo Funds
                    convertible  into common stocks.  The investment  strategy is focused on larger  capitalization     Management, LLC
                    stocks that fall within, but towards the higher end of, the range of the Russell 1000 Index.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    WFVT Large Company Growth:  seeks long-term  capital  appreciation.  The Portfolio  pursues its
                    objective by investing  primarily in common stocks of large,  high-quality  domestic  companies
                    that the Investment  Advisor believes have superior growth  potential.  The Investment  Advisor
 LARGE CAP EQUITY   looks for companies  whose growth  potential is generally  unrecognized  or misperceived by the    Wells Fargo Funds
                    market.  The  Portfolio  may invest,  under  normal  market  conditions,  at least 80% of total     Management, LLC
                    assets in securities with market  capitalizations of $3 billion or more, and up to 20% of total
                    assets in securities of foreign companies..
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    ------------------------------------------------------------------------------------------------ -----------------------
 LARGE CAP EQUITY   WFVT Equity Value:  seeks long-term  capital  appreciation and  above-average  dividend income.    Wells Fargo Funds
                    The  Portfolio  pursues its  objective by  investing  primarily  in equity  securities  of U.S.     Management, LLC
                    companies  with strong  return  potential  based on current  market  valuations.  Under  normal
                    circumstances,  the Portfolio  invests at least 80% of its assets in equity securities with the
                    same  characteristics  as common stocks, and in preferred stocks,  warrants,  and securities of
                    foreign companies through ADRs and similar investments.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
  EQUITY INCOME     WFVT Equity Income:  seeks long-term capital  appreciation and  above-average  dividend income.    Wells Fargo Funds
                    The  Portfolio  pursues its  objective  primarily by  investing in the common  stocks of large,     Management, LLC
                    domestic companies with  above-average  return potential based on current market valuations and
                    above-average  dividend income. Under normal market conditions,  the Portfolio invests at least
                    80% of its total assets in income producing  equity  securities and in issues of companies with
                    market capitalizations of $3 billion or more.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
ASSET ALLOCA-TION   WFVT Asset  Allocation:  seeks  long-term total return,  consistent  with reasonable  risk. The      Wells Capital
                    Portfolio  pursues its objective by allocating and  reallocating its assets among common stocks        Management
                    and U.S.  Treasury Bonds.  The Investment  Advisor manages the allocation of investments in the       Incorporated
                    Portfolio  assuming a  "neutral"  target  allocation  of 60%  stocks  and 40% bonds.  The stock
                    portion of the  Portfolio is invested to replicate the  weightings  of each company  comprising
                    the S&P 500 Index.  The bond  portion of the  Portfolio  is  invested to  replicate  the Lehman
                    Brothers 20+ Year Treasury Index.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------

- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      STYLE/                                        INVESTMENT OBJECTIVES/POLICIES                                         PORTFOLIO
       TYPE                                                                                                                 ADVISOR/
                                                                                                                          SUB-ADVISOR
                    ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
       BOND         WFVT Total Return Bond (f/k/a WFVT  Corporate  Bond):  seeks total return  consisting of income    Wells Fargo Funds
                    and capital  appreciation.  The  Portfolio  pursues its objective by investing  principally  in     Management, LLC
                    investment-grade debt securities,  which include U.S. Government obligations,  corporate bonds,
                    asset-backed  securities  and  money  market  instruments.  Under  normal  circumstances,   the
                    Portfolio will invest at least 80% of its assets in bonds.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
  INTERNATIONAL     AST Strong  International  Equity: seeks long-term capital growth by investing in a diversified      Strong Capital
      EQUITY        portfolio  of  international  equity  securities  the issuers of which are  considered  to have     Management, Inc.
                    strong  earnings  momentum.  The  Portfolio  seeks to meet its  objective by  investing,  under
                    normal  market  conditions,  at least 80% of its total  assets in a  diversified  portfolio  of
                    equity  securities  of  companies  located or operating in  developed  non-U.S.  countries  and
                    emerging  markets  of the  world.  The  Sub-advisor  intends  to  focus  on  companies  with an
                    above-average   potential  for  long-term  growth  and  attractive  relative  valuations.   The
                    Sub-advisor selects companies based on five key factors: growth,  valuation,  management,  risk
                    and sentiment.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
  INTERNATIONAL     AST William Blair  International  Growth (f/k/a AST Janus  Overseas  Growth):  seeks  long-term     William Blair &
      EQUITY        growth of capital.  The  Portfolio  pursues its  objective  primarily  through  investments  in     Company, L.L.C.
                    equity  securities  of issuers  located  outside  the United  States.  The  Portfolio  normally
                    invests at least 80% of its total assets in securities of issuers from at least five  different
                    countries,  excluding the United States.  The Portfolio invests primarily in companies selected
                    for their growth  potential.  Securities are generally  selected  without regard to any defined
                    allocation among countries,  geographic regions or industry sectors, or other similar selection
                    procedure.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
  INTERNATIONAL     AST American Century  International  Growth:  seeks capital growth.  The Portfolio will seek to     American Century
      EQUITY        achieve its investment  objective by investing  primarily in equity securities of international        Investment
                    companies  that the  Sub-advisor  believes  will  increase  in value  over time.  Under  normal      Management, Inc.
                    conditions,  the  Portfolio  will  invest at least 65% of its  assets in equity  securities  of
                    issuers from at least three  countries  outside of the United States.  The  Sub-advisor  uses a
                    growth  investment  strategy it developed  that looks for  companies  with earnings and revenue
                    growth.  The  Sub-advisor  will  consider  a  number  of other  factors  in  making  investment
                    selections,  including the prospects for relative  economic  growth among countries or regions,
                    economic and political  conditions,  expected inflation rates,  currency exchange  fluctuations
                    and tax considerations.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    AST DeAM  International  Equity:  seeks capital growth.  The Portfolio pursues its objective by
                    investing  at least 80% of the value of its assets in the equity  securities  of  companies  in
                    developed  non-U.S.  countries that are represented in the MSCI EAFE(R)Index. The target of this
  INTERNATIONAL     Portfolio  is to track the  performance  of the MSCI  EAFE(R)Index  within  4% with a  standard      Deutsche Asset
      EQUITY        deviation  expected of +/- 4%. The  Sub-advisor  considers  a number of factors in  determining     Management, Inc.
                    whether to invest in a stock,  including  earnings growth rate,  analysts'  estimates of future
                    earnings and industry-relative price multiples.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    AST MFS Global Equity:  seeks capital growth.  Under normal circumstances the Portfolio invests
                    at least 80% of its assets in equity securities of U.S. and foreign issuers  (including issuers      Massachusetts
  GLOBAL EQUITY     in developing  countries).  The Portfolio  generally seeks to purchase  securities of companies    Financial Services
                    with relatively large market capitalizations relative to the market in which they are traded.           Company
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
 SMALL CAP GROWTH   AST PBHG  Small-Cap  Growth:  seeks  capital  growth.  The  Portfolio  pursues its objective by     Pilgrim Baxter &
                    primarily  investing  at  least  80% of the  value  of its  assets  in  the  common  stocks  of     Associates, Ltd.
                    small-sized  companies,  whose market  capitalizations are similar to market capitalizations of
                    the  companies  in the  Russell  2000(R)Index at the time of the  Portfolio's  investment.  The
                    Sub-advisor  expects to focus primarily on those  securities  whose market  capitalizations  or
                    annual revenues are less than $1billion at the time of purchase.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------

- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      STYLE/                                        INVESTMENT OBJECTIVES/POLICIES                                         PORTFOLIO
       TYPE                                                                                                                 ADVISOR/
                                                                                                                          SUB-ADVISOR
                    ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
 SMALL CAP GROWTH   AST DeAM  Small-Cap  Growth:  seeks maximum  growth of  investors'  capital from a portfolio of      Deutsche Asset
                    growth  stocks of  smaller  companies.  The  Portfolio  pursues  its  objective,  under  normal     Management, Inc.
                    circumstances,  by  primarily  investing  at  least  80%  of its  total  assets  in the  equity
                    securities  of  small-sized   companies  included  in  the  Russell  2000  Growth(R)Index.  The
                    Sub-advisor  employs  an  investment  strategy  designed  to  maintain  a  portfolio  of equity
                    securities  which  approximates  the market risk of those  stocks  included in the Russell 2000
                    Growth(R)Index, but which attempts to outperform the Russell 2000 Growth(R)Index.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    AST Federated  Aggressive  Growth:  seeks capital growth.  The Portfolio pursues its investment
                    objective by investing in the stocks of small  companies  that are traded on national  security   Federated Investment
    SMALL CAP       exchanges,  NASDAQ stock  exchange and the  over-the-counter-market.  Small  companies  will be   Counseling/Federated
      GROWTH        defined as  companies  with market  capitalizations  similar to  companies  in the Russell 2000    Global Investment
                    Index or the Standard & Poor's  Small Cap 600 Index.  Up to 25% of the  Portfolio's  net assets     Management Corp.
                    may be invested in foreign securities, which are typically denominated in foreign currencies.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    ------------------------------------------------------------------------------------------------ -----------------------
 SMALL CAP VALUE    AST Gabelli Small-Cap Value:  seeks to provide long-term capital growth by investing  primarily          GAMCO
                    in  small-capitalization  stocks  that  appear to be  undervalued.  The  Portfolio  will have a     Investors, Inc.
                    non-fundamental policy to invest, under normal circumstances,  at least 80% of the value of its
                    assets in small capitalization  companies.  The 80% investment  requirement applies at the time
                    the  Portfolio  invests  its assets.  The  Portfolio  generally  defines  small  capitalization
                    companies as those with a capitalization  of $1.5 billion or less.  Reflecting a value approach
                    to  investing,  the Portfolio  will seek the stocks of companies  whose current stock prices do
                    not appear to adequately reflect their underlying value as measured by assets,  earnings,  cash
                    flow or business franchises.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
 SMALL CAP VALUE    AST DeAM Small-Cap Value:  seeks maximum growth of investors'  capital.  The Portfolio  pursues      Deutsche Asset
                    its  objective,  under normal  market  conditions,  by primarily  investing at least 80% of its     Management, Inc.
                    total assets in the equity  securities of small-sized  companies  included in the Russell 2000(R)
                    Value Index. The Sub-advisor  employs an investment  strategy  designed to maintain a portfolio
                    of equity  securities  which  approximates  the market  risk of those  stocks  included  in the
                    Russell 2000(R)Value Index, but which attempts to outperform the Russell 2000(R)Value Index.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
  MID-CAP GROWTH    AST Goldman Sachs Mid-Cap  Growth (f/k/a AST Janus Mid-Cap  Growth):  seeks  long-term  capital   Goldman Sachs Asset
                    growth.  The  Portfolio  pursues its  investment  objective,  by investing  primarily in equity        Management
                    securities selected for their growth potential,  and normally invests at least 80% of the value
                    of its assets in medium capitalization  companies. For purposes of the Portfolio,  medium-sized
                    companies  are those whose market  capitalizations  (measured at the time of  investment)  fall
                    within the range of  companies  in the  Standard & Poor's  MidCap  400 Index.  The  Sub-advisor
                    seeks  to  identify  individual  companies  with  earnings  growth  potential  that  may not be
                    recognized by the market at large.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
  MID-CAP GROWTH    AST Neuberger  Berman Mid-Cap  Growth:  seeks capital growth.  Under normal market  conditions,     Neuberger Berman
                    the Portfolio  primarily invests at least 80% of its net assets in the common stocks of mid-cap     Management Inc.
                    companies.  For purposes of the Portfolio,  companies with equity market  capitalizations  that
                    fall within the range of the Russell Midcap(R)Index,  at the time of investment,  are considered
                    mid-cap  companies.  Some of the  Portfolio's  assets  may be  invested  in the  securities  of
                    large-cap companies as well as in small-cap  companies.  The Sub-advisor looks for fast-growing
                    companies that are in new or rapidly evolving industries.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------

- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      STYLE/                                        INVESTMENT OBJECTIVES/POLICIES                                         PORTFOLIO
       TYPE                                                                                                                 ADVISOR/
                                                                                                                          SUB-ADVISOR
                    ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
   MID-CAP VALUE    AST Neuberger Berman Mid-Cap Value: seeks capital growth.  Under normal market conditions,  the     Neuberger Berman
                    Portfolio  primarily  invests at least 80% of its net  assets in the  common  stocks of mid-cap     Management Inc.
                    companies.  For purposes of the Portfolio,  companies with equity market  capitalizations  that
                    fall within the range of the Russell  Midcap(R)Index at the time of investment  are  considered
                    mid-cap  companies.  Some of the  Portfolio's  assets  may be  invested  in the  securities  of
                    large-cap  companies as well as in small-cap  companies.  Under the Portfolio's  value-oriented
                    investment  approach,  the Sub-advisor looks for well-managed  companies whose stock prices are
                    undervalued and that may rise in price before other investors realize their worth.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      ALL-CAP       AST Alger All-Cap Growth:  seeks long-term  capital growth.  The Portfolio invests primarily in        Fred Alger
      GROWTH        equity securities,  such as common or preferred stocks, that are listed on U.S. exchanges or in     Management, Inc.
                    the  over-the-counter  market.  The Portfolio may invest in the equity  securities of companies
                    of all sizes,  and may emphasize  either  larger or smaller  companies at a given time based on
                    the Sub-advisor's assessment of particular companies and market conditions.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    AST Gabelli  All-Cap  Value:  seeks  capital  growth.  The  Portfolio  pursues its objective by
                    investing primarily in readily marketable equity securities including common stocks,  preferred
                    stocks and  securities  that may be converted at a later time into common stock.  The Portfolio
      ALL-CAP       may invest in the  securities  of companies of all sizes,  and may  emphasize  either larger or
       VALUE        smaller  companies  at a  given  time  based  on the  Sub-advisor's  assessment  of  particular  GAMCO Investors, Inc.
                    companies and market  conditions.  The Portfolio  focuses on companies that appear  underpriced
                    relative  to their  private  market  value  ("PMV").  PMV is the  value  that  the  Portfolio's
                    Sub-advisor believes informed investors would be willing to pay for a company.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    AST T. Rowe Price Natural  Resources:  seeks  long-term  capital growth  primarily  through the
                    common stocks of companies  that own or develop  natural  resources  (such as energy  products,
                    precious  metals and forest  products)  and other basic  commodities.  The  Portfolio  normally
                    invests  primarily (at least 80% of its total assets) in the common stocks of natural  resource
      SECTOR        companies whose earnings and tangible  assets could benefit from  accelerating  inflation.  The      T. Rowe Price
                    Portfolio looks for companies that have the ability to expand production,  to maintain superior     Associates, Inc.
                    exploration  programs  and  production   facilities,   and  the  potential  to  accumulate  new
                    resources.  At least 50% of Portfolio assets will be invested in U.S. securities,  up to 50% of
                    total assets also may be invested in foreign securities.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    AST Alliance  Growth:  seeks long-term  capital growth.  The Portfolio  invests at least 80% of
                    its total assets in the equity  securities of a limited  number of large,  carefully  selected,
                    high-quality  U.S.  companies  that are judged  likely to  achieve  superior  earnings  growth.
 LARGE CAP GROWTH   Normally,  about 40-60  companies will be  represented in the Portfolio,  with the 25 companies     Alliance Capital
                    most  highly  regarded  by  the  Sub-advisor  usually  constituting  approximately  70%  of the     Management, L.P.
                    Portfolio's  net assets.  An emphasis is placed on identifying  companies  whose  substantially
                    above average prospective earnings growth is not fully reflected in current market valuations.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
 LARGE CAP GROWTH   AST MFS  Growth:  seeks  long-term  capital  growth  and future  income.  Under  normal  market
                    conditions,  the  Portfolio  invests  at least 80% of its total  assets  in common  stocks  and
                    related securities,  such as preferred stocks,  convertible securities and depositary receipts,
                    of companies that the  Sub-advisor  believes offer better than average  prospects for long-term      Massachusetts
                    growth.  The Sub-advisor seeks to purchase  securities of companies that it considers  well-run    Financial Services
                    and  poised  for  growth.  The  Portfolio  may  invest up to 35% of its net  assets in  foreign         Company
                    securities.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------

- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      STYLE/                                        INVESTMENT OBJECTIVES/POLICIES                                         PORTFOLIO
       TYPE                                                                                                                 ADVISOR/
                                                                                                                          SUB-ADVISOR
                    ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
 LARGE CAP GROWTH   AST Marsico  Capital  Growth:  seeks capital  growth.  Income  realization is not an investment     Marsico Capital
                    objective  and  any  income  realized  on  the  Portfolio's  investments,  therefore,  will  be     Management, LLC
                    incidental to the Portfolio's  objective.  The Portfolio will pursue its objective by investing
                    primarily in common stocks of larger,  more  established  companies.  In selecting  investments
                    for the Portfolio,  the Sub-advisor uses an approach that combines "top down" economic analysis
                    with "bottom up" stock selection.  The "top down" approach identifies  sectors,  industries and
                    companies that should benefit from the trends the  Sub-advisor  has observed.  The  Sub-advisor
                    then looks for individual  companies with earnings growth  potential that may not be recognized
                    by the market at large, a "bottom up" stock selection.
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                    AST Goldman Sachs Concentrated  Growth (f/k/a AST JanCap Growth):  seeks growth of capital in a
                    manner  consistent  with  the  preservation  of  capital.   Realization  of  income  is  not  a
                    significant  investment  consideration and any income realized on the Portfolio's  investments,
                    therefore,  will be  incidental to the  Portfolio's  objective.  The Portfolio  will pursue its
 LARGE CAP GROWTH   objective  by investing  primarily  in equity  securities  of  companies  that the  Sub-advisor   Goldman Sachs Asset
                    believes have  potential to achieve  capital  appreciation  over the  long-term.  The Portfolio        Management
                    seeks to achieve  its  investment  objective  by  investing,  under  normal  circumstances,  in
                    approximately  30 - 45 companies  that are  considered by the  Sub-advisor to be positioned for
                    long-term growth.
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                    AST DeAM  Large-Cap  Growth:  seeks  maximum  growth of capital by  investing  primarily in the
                    growth stocks of larger  companies.  The Portfolio  pursues its objective,  under normal market
                    conditions,  by primarily  investing at least 80% of its total assets in the equity  securities
 LARGE CAP GROWTH   of large-sized  companies  included in the Russell 1000(R)Growth Index. The Sub-advisor  employs      Deutsche Asset
                    an  investment   strategy   designed  to  maintain  a  portfolio  of  equity  securities  which     Management, Inc.
                    approximates  the market risk of those stocks  included in the Russell 1000(R)Growth Index,  but
                    which attempts to outperform the Russell 1000(R)Growth Index through active stock selection.
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                    AST DeAM Large-Cap Value (f/k/a AST Janus Strategic Value):  seeks maximum growth of capital by
                    investing  primarily  in the value  stocks of  larger  companies.  The  Portfolio  pursues  its
                    objective,  under normal market conditions, by primarily investing at least 80% of the value of
                    its assets in the equity  securities  of  large-sized  companies  included in the Russell 1000(R)    Deutsche Asset
  LARGE CAP VALUE   Value Index. The Sub-advisor  employs an investment  strategy  designed to maintain a portfolio     Management, Inc.
                    of equity  securities  which  approximates  the market  risk of those  stocks  included  in the
                    Russell  1000(R)Value Index,  but which  attempts to  outperform  the Russell  1000(R)Value Index
                    through active stock selection.
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    LARGE CAP       AST Alliance/Bernstein  Growth + Value: seeks capital growth by investing  approximately 50% of     Alliance Capital
     BLEND          its assets in growth  stocks of large  companies and  approximately  50% of its assets in value     Management, L.P.
                    stocks of large  companies.  The Portfolio will invest primarily in common stocks of large U.S.
                    companies included in the Russell 1000(R)Index (the "Russell 1000(R)"). The Russell 1000(R)is a
                    market  capitalization-weighted  index that measures the  performance of the 1,000 largest U.S.
                    companies.  Normally,  about 60-85  companies will be represented in the Portfolio,  with 25-35
                    companies  primarily from the Russell 1000(R)Growth Index constituting  approximately 50% of the
                    Portfolio's  net assets and 35-50  companies  primarily  from the  Russell  1000(R)Value  Index
                    constituting  the  remainder  of  the  Portfolio's  net  assets.   There  will  be  a  periodic
                    rebalancing  of each  segment's  assets  to take  account  of market  fluctuations  in order to
                    maintain the approximately equal allocation.
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  LARGE CAP VALUE   AST Sanford  Bernstein Core Value:  seeks  long-term  capital growth by investing  primarily in   Sanford C. Bernstein
                    common stocks.  The  Sub-advisor  expects that the majority of the  Portfolio's  assets will be        & Co., LLC
                    invested in the common stocks of large  companies  that appear to be  undervalued.  Among other
                    things, the Portfolio seeks to identify compelling buying opportunities  created when companies
                    are undervalued on the basis of investor  reactions to near-term problems or circumstances even
                    though their long-term  prospects  remain sound. The Sub-advisor  seeks to identify  individual
                    companies with earnings growth potential that may not be recognized by the market at large.
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- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      STYLE/                                        INVESTMENT OBJECTIVES/POLICIES                                         PORTFOLIO
       TYPE                                                                                                                 ADVISOR/
                                                                                                                          SUB-ADVISOR
                    ------------------------------------------------------------------------------------------------ -----------------------
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   REAL ESTATE      AST Cohen & Steers Realty:  seeks to maximize  total return  through  investment in real estate      Cohen & Steers
     (REIT)         securities.  The  Portfolio  pursues  its  investment  objective  by  investing,  under  normal    Capital Management,
                    circumstances,  at least 80% of its net assets in  securities  of real  estate  issuers.  Under          Inc.
                    normal  circumstances,  the Portfolio will invest substantially all of its assets in the equity
                    securities of real estate companies,  i.e., a company that derives at least 50% of its revenues
                    from the ownership,  construction,  financing, management or sale of real estate or that has at
                    least  50% of its  assets in real  estate.  Real  estate  companies  may  include  real  estate
                    investment trusts or REITs.
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- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    AST Sanford Bernstein Managed Index 500: will invest, under normal circumstances,  at least 80%
                    of its net assets in  securities  included in the Standard & Poor's 500  Composite  Stock Price
                    Index  (the  "S&P(R)500 ").  The  Portfolio  seeks  to  outperform  the S&P 500  through  stock
                    selection  resulting  in  different  weightings  of common  stocks  relative to the index.  The
                    Portfolio will invest  primarily in the common stocks of companies  included in the S&P 500. In
                    seeking  to  outperform  the S&P  500,  the  Sub-advisor  starts  with a  portfolio  of  stocks
  MANAGED INDEX     representative  of the holdings of the index.  It then uses a set of  fundamental  quantitative   Sanford C. Bernstein
                    criteria  that are designed to indicate  whether a particular  stock will  predictably  perform        & Co., LLC
                    better or worse than the S&P 500. Based on these criteria,  the Sub-advisor  determines whether
                    the  Portfolio  should  over-weight,  under-weight  or hold a  neutral  position  in the  stock
                    relative  to the  proportion  of the S&P 500  that  the  stock  represents.  In  addition,  the
                    Sub-advisor  also  may  determine  that  based on the  quantitative  criteria,  certain  equity
                    securities that are not included in the S&P 500 should be held by the Portfolio.
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                    AST American  Century Income & Growth:  seeks capital growth with current income as a secondary
                    objective.  The Portfolio  invests  primarily in common stocks that offer potential for capital
      GROWTH        growth,  and may,  consistent  with its  investment  objective,  invest  in stocks  that  offer     American Century
       AND          potential for current income.  The  Sub-advisor  utilizes a quantitative  management  technique        Investment
      INCOME        with a goal of building an equity  portfolio  that  provides  better  returns  than the S&P 500     Management, Inc.
                    Index without taking on significant  additional risk and while  attempting to create a dividend
                    yield that will be greater than the S&P 500 Index.
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- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    AST Alliance Growth and Income:  seeks long-term  growth of capital and income while attempting
                    to avoid excessive  fluctuations in market value. The Portfolio  normally will invest in common
      GROWTH        stocks  (and  securities   convertible  into  common  stocks).  The  Sub-advisor  will  take  a
       AND          value-oriented  approach,  in that it will  try to keep  the  Portfolio's  assets  invested  in     Alliance Capital
      INCOME        securities that are selling at reasonable  valuations in relation to their fundamental business     Management, L.P.
                    prospects.  The  stocks  that the  Portfolio  will  normally  invest in are  those of  seasoned
                    companies.
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- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    AST MFS Growth with  Income:  seeks long term growth of capital  with a secondary  objective to
                    seek  reasonable  current  income.  Under normal market  conditions,  the Portfolio  invests at
                    least 65% of its net assets in common stocks and related securities,  such as preferred stocks,
      GROWTH        convertible  securities  and  depositary  receipts.  The stocks in which the Portfolio  invests      Massachusetts
       AND          generally  will pay  dividends.  While the Portfolio  may invest in companies of any size,  the    Financial Services
      INCOME        Portfolio  generally  focuses  on  companies  with  larger  market   capitalizations  that  the         Company
                    Sub-advisor  believes have  sustainable  growth  prospects and attractive  valuations  based on
                    current and  expected  earnings  or cash flow.  The  Portfolio  may invest up to 20% of its net
                    assets in foreign securities.
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  EQUITY INCOME     AST INVESCO Capital Income (f/k/a AST INVESCO Equity Income):  seeks capital growth and current   INVESCO Funds Group,
                    income  while  following  sound  investment  practices.  The  Portfolio  seeks to  achieve  its         Inc.
                    objective by investing in  securities  that are expected to produce  relatively  high levels of
                    income and consistent,  stable returns.  The Portfolio normally will invest at least 65% of its
                    assets in  dividend-paying  common and preferred stocks of domestic and foreign issuers.  Up to
                    30% of the  Portfolio's  assets may be  invested in equity  securities  that do not pay regular
                    dividends.
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- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      STYLE/                                        INVESTMENT OBJECTIVES/POLICIES                                         PORTFOLIO
       TYPE                                                                                                                 ADVISOR/
                                                                                                                          SUB-ADVISOR
                    ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
     BALANCED       AST DeAM Global  Allocation:  seeks a high level of total  return by  investing  primarily in a      Deutsche Asset
                    diversified  portfolio  of  mutual  funds.  The  Portfolio  seeks  to  achieve  its  investment
                    objective  by  investing  in  several  other  AST  Portfolios  ("Underlying  Portfolios").  The
                    Portfolio intends its strategy of investing in combinations of Underlying  Portfolios to result
                    in  investment  diversification  that an  investor  could  otherwise  achieve  only by  holding
                    numerous  investments.  The  Portfolio  is  expected  to be  invested  in  at  least  six  such
                    Underlying  Portfolios at any time. It is expected that the  investment  objectives of such AST     Management, Inc.
                    Portfolios will be diversified.
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- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    AST  American  Century  Strategic  Balanced:  seeks  capital  growth and  current  income.  The
                    Sub-advisor  intends  to  maintain  approximately  60%  of the  Portfolio's  assets  in  equity
                    securities and the remainder in bonds and other fixed income  securities.  Both the Portfolio's     American Century
     BALANCED       equity and fixed  income  investments  will  fluctuate  in value.  The equity  securities  will        Investment
                    fluctuate  depending on the  performance of the companies that issued them,  general market and     Management, Inc.
                    economic  conditions,  and investor  confidence.  The fixed income investments will be affected
                    primarily by rising or falling interest rates and the credit quality of the issuers.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
ASSET ALLOCATION   AST T. Rowe Price Asset Allocation:  seeks a high level of total return by investing  primarily      T. Rowe Price
                    in a  diversified  portfolio  of fixed income and equity  securities.  The  Portfolio  normally     Associates, Inc.
                    invests  approximately  60% of its total  assets in equity  securities  and 40% in fixed income
                    securities.  The Sub-advisor  concentrates common stock investments in larger, more established
                    companies,  but the  Portfolio may include small and  medium-sized  companies  with good growth
                    prospects.  The fixed income portion of the Portfolio will be allocated among  investment grade
                    securities, high yield or "junk" bonds, foreign high quality debt securities and cash reserves.
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   GLOBAL BOND      AST T. Rowe Price Global  Bond:  seeks to provide  high  current  income and capital  growth by      T. Rowe Price
                    investing  in  high-quality  foreign and U.S.  dollar-denominated  bonds.  The  Portfolio  will     International, Inc.
                    invest at least 80% of its total  assets in all types of high  quality  bonds  including  those
                    issued  or  guaranteed  by U.S.  or  foreign  governments  or  their  agencies  and by  foreign
                    authorities,  provinces and  municipalities  as well as investment  grade  corporate  bonds and
                    mortgage and  asset-backed  securities of U.S. and foreign  issuers.  The  Portfolio  generally
                    invests in countries where the combination of fixed-income  returns and currency exchange rates
                    appears attractive,  or, if the currency trend is unfavorable,  where the Sub-advisor  believes
                    that the currency risk can be minimized  through  hedging.  The Portfolio may also invest up to
                    20% of its assets in the aggregate in below  investment-grade,  high-risk bonds ("junk bonds").
                    In addition,  the  Portfolio may invest up to 30% of its assets in  mortgage-backed  (including
                    derivatives,  such as collateralized mortgage obligations and stripped mortgage securities) and
                    asset-backed securities.
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 HIGH YIELD BOND    AST Federated  High Yield:  seeks high current  income by investing  primarily in a diversified   Federated Investment
                    portfolio of fixed income  securities.  The Portfolio will invest at least 80% of its assets in        Counseling
                    fixed  income  securities  rated BBB and below.  These  fixed  income  securities  may  include
                    preferred  stocks,   convertible  securities,   bonds,   debentures,   notes,  equipment  lease
                    certificates  and equipment trust  certificates.  A fund that invests  primarily in lower-rated
                    fixed  income  securities  will be subject to greater risk and share price  fluctuation  than a
                    typical  fixed income fund,  and may be subject to an amount of risk that is  comparable  to or
                    greater than many equity funds.
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- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      STYLE/                                        INVESTMENT OBJECTIVES/POLICIES                                         PORTFOLIO
       TYPE                                                                                                                 ADVISOR/
                                                                                                                          SUB-ADVISOR
                    ------------------------------------------------------------------------------------------------ -----------------------
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       BOND         AST Lord Abbett  Bond-Debenture:  seeks high  current  income and the  opportunity  for capital  Lord, Abbett & Co. LLC
                    appreciation  to produce a high total  return.  To pursue its  objective,  the  Portfolio  will
                    invest,  under  normal  circumstances,  at least 80% of the value of its assets in fixed income
                    securities and normally  invests  primarily in high yield and investment grade debt securities,
                    securities  convertible  in common stock and  preferred  stocks.  The  Portfolio  may find good
                    value in high yield  securities,  sometimes  called  "lower-rated  bonds" or "junk  bonds," and
                    frequently  may have more than half of its assets  invested in those  securities.  At least 20%
                    of the  Portfolio's  assets  must be  invested  in any  combination  of  investment  grade debt
                    securities,  U.S.  Government  securities  and cash  equivalents.  The  Portfolio may also make
                    significant  investments  in  mortgage-backed  securities.  Although the  Portfolio  expects to
                    maintain  a  weighted  average  maturity  in the  range of five to twelve  years,  there are no
                    restrictions  on the overall  Portfolio or on individual  securities.  The Portfolio may invest
                    up to 20% of its net assets in equity securities.
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                    AST DeAM Bond:  seeks a high level of income,  consistent  with the  preservation  of  capital.
                    Under  normal  circumstances,  the  Portfolio  invests  at least  80% of its  total  assets  in
                    intermediate-term  U.S.  Treasury,   corporate,   mortgage-backed  and  asset-backed,   taxable
       BOND         municipal and tax-exempt  municipal bonds. The Portfolio  invests primarily in investment grade      Deutsche Asset
                    fixed  income  securities  rated  within  the  top  three  rating  categories  of a  nationally     Management, Inc.
                    recognized  rating  organization.  Fixed  income  securities  may be issued by U.S. and foreign
                    corporations or entities including banks and various government entities.
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       BOND         AST PIMCO Total Return Bond:  seeks to maximize total return  consistent  with  preservation of    Pacific Investment
                    capital  and  prudent  investment  management.  The  Portfolio  will  invest  in a  diversified
                    portfolio of fixed-income  securities of varying maturities.  The average portfolio duration of
                    the  Portfolio  generally  will  vary  within a three-  to  six-year  time  frame  based on the
                    Sub-advisor's forecast for interest rates.                                                       Management Company LLC
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       BOND         AST PIMCO Limited  Maturity Bond: seeks to maximize total return  consistent with  preservation
                    of capital  and prudent  investment  management.  The  Portfolio  will invest in a  diversified
                    portfolio of fixed-income  securities of varying maturities.  The average portfolio duration of
                    the  Portfolio  generally  will  vary  within  a one- to  three-year  time  frame  based on the    Pacific Investment
                    Sub-advisor's forecast for interest rates.                                                       Management Company LLC
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   MONEY MARKET     AST Money  Market:  seeks high  current  income and  maintain  high  levels of  liquidity.  The      Wells Capital
                    Portfolio  attempts to  accomplish  its  objective by  maintaining  a  dollar-weighted  average     Management, Inc.
                    maturity  of not  more  than 90 days  and by  investing  in  securities  which  have  effective
                    maturities of not more than 397 days.
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 EMERGING MARKETS   Gartmore Variable Investment Trust - Developing Markets:  seeks long-term capital appreciation,
                    under  normal  conditions  by investing at least 80% of its total assets in stocks of companies   Gartmore Global Asset
                    of any size  based  in the  world's  developing  economies.  Under  normal  market  conditions,        Management
                    investments  are  maintained  in at least  six  countries  at all times and no more than 35% of  Trust/Gartmore Global
                    total assets in any single one of them.                                                                 Partners
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  MID-CAP EQUITY    INVESCO Variable  Investment  Funds - Dynamics:  seek long-term  capital growth.  The Portfolio   INVESCO Funds Group,
                    invests at least 65% of its assets in common  stocks of mid-sized  companies.  INVESCO  defines          Inc.
                    mid-sized  companies as companies  that are included in the Russell  Midcap Growth Index at the
                    time of purchase,  or if not  included in that Index,  have market  capitalizations  of between
                    $2.5 billion and $15 billion at the time of purchase.  The core of the Portfolio's  investments
                    are in securities of established  companies that are leaders in attractive  growth markets with
                    a history of strong  returns.  The  remainder  of the  Portfolio is invested in  securities  of
                    companies  that show  accelerating  growth,  driven by product  cycles,  favorable  industry or
                    sector  conditions,  and other  factors  that  INVESCO  believes  will  lead to rapid  sales or
                    earnings growth.
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- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      STYLE/                                        INVESTMENT OBJECTIVES/POLICIES                                         PORTFOLIO
       TYPE                                                                                                                 ADVISOR/
                                                                                                                          SUB-ADVISOR
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    ------------------------------------------------------------------------------------------------ -----------------------
      SECTOR        INVESCO Variable  Investment Funds - Technology:  seeks capital growth.  The Portfolio normally   INVESCO Funds Group,
                    invests  80% of its net assets in the  equity  securities  and  equity-related  instruments  of           Inc.
                    companies  engaged in  technology-related  industries.  These include,  but are not limited to,
                    various applied technologies, hardware, software, semiconductors,  telecommunications equipment
                    and services and service-related  companies in information  technology.  Many of these products
                    and services are subject to rapid obsolescence,  which may lower market value of the securities
                    of the  companies  in this  sector.  At any given time,  20% of the  Portfolio's  assets is not
                    required to be invested in the sector.
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- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      SECTOR        INVESCO  Variable  Investment  Funds - Health  Sciences:  seeks capital  growth.  The Portfolio   INVESCO Funds Group,
                    normally  invests at least 80% of its net assets in the equity  securities  and  equity-related         Inc.
                    instruments of companies that develop,  produce or distribute  products or services  related to
                    health care. These companies  include,  but are not limited to, medical  equipment or supplies,
                    pharmaceuticals,  biotechnology and healthcare  providers and service  companies.  At any given
                    time, 20% of the Portfolio's assets is not required to be invested in the sector.
- ------------------- ------------------------------------------------------------------------------------------------
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      SECTOR        INVESCO Variable  Investment Funds - Financial  Services:  seeks capital growth.  The Portfolio   INVESCO Funds Group,
                    normally  invests at least 80% of its net assets in the equity  securities  and  equity-related          Inc.
                    instruments of companies  involved in the financial  services sector.  These companies include,
                    but are not  limited  to,  banks  (regional  and  money-centers),  insurance  companies  (life,
                    property  and  casualty,  and  multiline),   investment  and  miscellaneous  industries  (asset
                    managers,  brokerage  firms,  and  government-sponsored  agencies)  and  suppliers to financial
                    services  companies.  At any given time,  20% of the  Portfolio's  assets is not required to be
                    invested in the sector.
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- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      SECTOR        INVESCO  Variable  Investment  Funds -  Telecommunications:  seeks  capital  growth and current   INVESCO Funds Group,
                    income.  The  Portfolio  normally  invests 80% of its net assets in the equity  securities  and         Inc.
                    equity-related  instruments  of  companies  engaged in the  design,  development,  manufacture,
                    distribution,  or sale of  communications  services  and  equipment,  and  companies  that  are
                    involved in supplying equipment or services to such companies.  The  telecommunications  sector
                    includes,   but  is  not  limited  to,  companies  that  offer  telephone  services,   wireless
                    communications,  satellite communications,  television and movie programming,  broadcasting and
                    Internet access. Many of these products and services are subject to rapid  obsolescence,  which
                    may lower the market value of the  securities  of the  companies  in this sector.  At any given
                    time, 20% of the Portfolio's assets is not required to be invested in the sector.
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  INTERNATIONAL     Evergreen VA  International  Equity:  (acquired  Evergreen VA Global  Leaders) seeks  long-term
      EQUITY        capital growth and,  secondarily,  modest  income.  The Portfolio  invests  primarily in equity
                    securities  issued by  established,  quality,  non-U.S.  companies  located in  countries  with
                    developed markets, but may purchase across all market  capitalizations.  The Portfolio normally   Evergreen Investment
                    invests at least 65% of its assets in  securities  of  companies  in at least  three  different   Management Company,
                    countries  (other than the U.S.),  but may invest  more than 25% of its assets in one  country.           LLC
                    The Portfolio also invests in emerging markets
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- -------------------
 SMALL CAP EQUITY   Evergreen VA Special Equity:  seeks capital  growth.  The Portfolio  normally  invests at least   Evergreen Investment
                    80% of its assets in common  stocks of small  U.S.  companies  (i.e.,  companies  whose  market     Management Company,
                    capitalizations  fall within the range of the Russell  2000(R)Index,  at the time of  purchase).           LLC
                    The remaining 20% of the  Portfolio's  assets may be represented by cash or invested in various
                    cash  equivalents.  The Portfolio's  manager selects stocks of companies which it believes have
                    the potential for accelerated growth in earnings and price.
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- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
  MID-CAP EQUITY    Evergreen VA Omega:  seeks long-term capital growth.  The Portfolio invests primarily in common
                    stocks and  securities  convertible  into  common  stocks of U.S.  companies  across all market
                    capitalizations.  The  Portfolio's  managers  employ  a  growth  style  of  equity  management.   Evergreen Investment
                    "Growth" stocks are stocks of companies that the Portfolio's  managers believe have anticipated   Management Company,
                    earnings ranging from steady to accelerated growth.                                                       LLC
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- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      STYLE/                                        INVESTMENT OBJECTIVES/POLICIES                                         PORTFOLIO
       TYPE                                                                                                                 ADVISOR/
                                                                                                                          SUB-ADVISOR
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------

- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
  INTERNATIONAL     ProFund  VP  Europe  30:  seeks  daily  investment  results,  before  fees and  expenses,  that   ProFund Advisors LLC
      EQUITY        correspond to the daily  performance of the ProFunds  Europe 30 Index.  The ProFunds  Europe 30
                    Index,  created by ProFund  Advisors,  is composed of 30 companies whose principal  offices are
                    located  in Europe  and whose  securities  are  traded on U.S.  exchanges  or on the  NASDAQ as
                    depositary  receipts or ordinary  shares.  The  component  companies in the ProFunds  Europe 30
                    Index are  determined  annually  based upon their U.S.  dollar-traded  volume.  Their  relative
                    weights are determined based on a modified market capitalization method.
                    ------------------------------------------------------------------------------------------------ -----------------------
                    ------------------------------------------------------------------------------------------------ -----------------------

- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
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  INTERNATIONAL     ProFund VP Asia 30: seeks daily investment results,  before fees and expenses,  that correspond   ProFund Advisors LLC
     EQUITY         to the daily  performance  of the ProFunds Asia 30 Index.  The ProFunds Asia 30 Index,  created
                    by ProFund Advisors,  is composed of 30 of the companies whose principal offices are located in
                    the Asia/Pacific region,  excluding Japan, and whose securities are traded on U.S. exchanges or
                    on the NASDAQ as  depository  receipts or  ordinary  shares.  The  component  companies  in the
                    ProFunds Asia 30 Index are  determined  annually  based upon their U.S.  dollar-traded  volume.
                    Their relative weights are determined based on the modified market capitalization method.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    ProFund VP Japan: seeks daily investment results,  before fees and expenses, that correspond to
                    the daily  performance  of the Nikkei 225 Stock  Average.  Since the  Japanese  markets are not
                    open when  ProFund VP Japan  values its  shares,  ProFund VP Japan  determines  its  success in
  INTERNATIONAL     meeting this  investment  objective by comparing its daily return on a given day with the daily   ProFund Advisors LLC
      EQUITY        performance of related  futures  contracts  traded in the United  States.  The Nikkei 225 Stock
                    Average is a price-weighted  index of 225 large,  actively traded Japanese stocks traded on the
                    Tokyo Stock Exchange.  The Index is computed and distributed by the Nihon Keizai Shimbun.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      SECTOR        ProFund VP Banks: seeks daily investment results,  before fees and expenses, that correspond to   ProFund Advisors LLC
                    the daily  performance  of the Dow Jones U.S.  Banks  Sector  Index.  The Dow Jones U.S.  Banks
                    Index measures the  performance of the banking  industry of the U.S.  equity market.  Component
                    companies  include all  regional  and major U.S.  domiciled  international  banks,  savings and
                    loans, savings banks,  thrifts,  building  associations and societies.  Investment and merchant
                    banks are excluded.
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- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    ProFund VP Basic Materials:  seeks daily  investment  results,  before fees and expenses,  that
                    correspond to the daily  performance of the Dow Jones U.S. Basic  Materials  Sector Index.  The
                    Dow Jones U.S. Basic  Materials  Sector Index measures the  performance of the basic  materials
      SECTOR        economic sector of the U.S. equity market.  Component  companies are involved in the production   ProFund Advisors LLC
                    of aluminum,  commodity chemicals,  specialty chemicals,  forest products,  non-ferrous metals,
                    paper products, precious metals and steel.
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- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    ProFund VP  Biotechnology:  seeks daily  investment  results,  before fees and  expenses,  that
                    correspond to the daily  performance of the Dow Jones U.S.  Biotechnology  Index. The Dow Jones
                    U.S.  Biotechnology  Index measures the performance of the  biotechnology  industry of the U.S.
      SECTOR        equity  market.  Component  companies  include  those engaged in genetic  research,  and/or the   ProFund Advisors LLC
                    marketing  and  development  of  recombinant  DNA  products.  Makers  of  artificial  blood and
                    contract biotechnology researchers are also included in the Index.
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- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      SECTOR        ProFund VP Consumer Cyclical:  seeks daily investment results,  before fees and expenses,  that   ProFund Advisors LLC
                    correspond to the daily  performance of the Dow Jones U.S.  Consumer Cyclical Sector Index. The
                    Dow Jones U.S.  Consumer  Cyclical  Sector  Index  measures  the  performance  of the  consumer
                    cyclical  economic  sector of the U.S. equity market.  Component  companies  include  airlines,
                    auto manufacturers,  auto parts, tires, casinos,  consumer  electronics,  recreational products
                    and services,  restaurants,  lodging, toys, home construction, home furnishings and appliances,
                    footwear, clothing and fabrics.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------

- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      STYLE/                                        INVESTMENT OBJECTIVES/POLICIES                                         PORTFOLIO
       TYPE                                                                                                                 ADVISOR/
                                                                                                                          SUB-ADVISOR
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      SECTOR        ProFund VP Consumer  Non-Cyclical:  seeks daily investment  results,  before fees and expenses,   ProFund Advisors LLC
                    that correspond to the daily  performance of the Dow Jones U.S.  Consumer  Non-Cyclical  Sector
                    Index. The Dow Jones U.S.  Consumer  Non-Cyclical  Sector Index measures the performance of the
                    consumer  non-cyclical  economic sector of the U.S. equity market.  Component companies include
                    beverage  companies,  consumer service  companies,  durable and non-durable  household  product
                    manufacturers, cosmetic companies, food products and agriculture and tobacco products.
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- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      SECTOR        ProFund VP Energy:  seeks daily investment results,  before fees and expenses,  that correspond   ProFund Advisors LLC
                    to the daily  performance of the Dow Jones U.S. Energy Sector Index.  The Dow Jones U.S. Energy
                    Sector  Index  measures  the  performance  of the  energy  sector  of the U.S.  equity  market.
                    Component  companies include oil drilling  equipment and services,  coal, oil  companies-major,
                    oil companies-secondary,  pipelines, liquid, solid or gaseous fossil fuel producers and service
                    companies.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      SECTOR        ProFund  VP  Financial:  seeks  daily  investment  results,  before  fees  and  expenses,  that   ProFund Advisors LLC
                    correspond to the daily  performance  of the Dow Jones U.S.  Financial  Sector  Index.  The Dow
                    Jones U.S.  Financial Sector Index measures the performance of the financial  services economic
                    sector of the U.S.  equity market.  Component  companies  include  regional  banks,  major U.S.
                    domiciled  international banks, full line, life, and property and casualty insurance companies,
                    companies that invest,  directly or indirectly in real estate,  diversified financial companies
                    such  as  Fannie  Mae,  credit  card  insurers,  check  cashing  companies,  mortgage  lenders,
                    investment  advisers and securities  broker-dealers,  investment banks,  merchant banks, online
                    brokers, publicly traded stock exchanges.
- ------------------- ------------------------------------------------------------------------------------------------
                    ------------------------------------------------------------------------------------------------ -----------------------
      SECTOR        ProFund  VP  Healthcare:  seeks  daily  investment  results,  before  fees and  expenses,  that   ProFund Advisors LLC
                    correspond to the daily  performance of the Dow Jones U.S.  Healthcare  Sector Index.  The Down
                    Jones U.S.  Healthcare Sector Index measures the performance of the healthcare  economic sector
                    of the U.S. equity market.  Component  companies  include health care providers,  biotechnology
                    companies, medical supplies, advanced medical devices and pharmaceuticals.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      SECTOR        ProFund  VP  Industrial:  seeks  daily  investment  results,  before  fees and  expenses,  that   ProFund Advisors LLC
                    correspond to the daily  performance  of the Dow Jones U.S.  Industrial  Sector Index.  The Dow
                    Jones U.S.  Industrial Sector Index measures the performance of the industrial  economic sector
                    of  the  U.S.  equity  market.   Component   companies   include  building   materials,   heavy
                    construction,  factory  equipment,  heavy machinery,  industrial  services,  pollution control,
                    containers  and  packaging,   industrial  diversified,   air  freight,  marine  transportation,
                    railroads,  trucking,  land-transportation  equipment,  shipbuilding,  transportation services,
                    advanced industrial equipment, electric components and equipment, and aerospace.
- ------------------- ------------------------------------------------------------------------------------------------
                    ------------------------------------------------------------------------------------------------ -----------------------
      SECTOR        ProFund VP Internet:  seeks daily investment results, before fees and expenses, that correspond   ProFund Advisors LLC
                    to the daily  performance  of the Dow  Jones  U.S.  Internet  Index.  The Dow  Jones  Composite
                    Internet Index measures the  performance of stocks in the U.S. equity markets that generate the
                    majority  of their  revenues  from the  Internet.  The  Index is  composed  of two  sub-groups:
                    Internet  Commerce - companies that derive the majority of their revenues from providing  goods
                    and/or services through an open network,  such as a web site; and Internet Services - companies
                    that derive the majority of their revenues from  providing  access to the Internet or providing
                    services to people using the Internet.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      SECTOR        ProFund VP  Pharmaceuticals:  seeks daily investment  results,  before fees and expenses,  that   ProFund Advisors LLC
                    correspond to the daily  performance of the Dow Jones U.S.  Pharmaceuticals  Sector Index.  The
                    Dow Jones U.S.  Pharmaceuticals Index measures the performance of the pharmaceuticals  industry
                    of the U.S.  equity  market.  Component  companies  include  the  makers  of  prescription  and
                    over-the-counter  drugs, such as aspirin, cold remedies,  birth control pills, and vaccines, as
                    well as companies engaged in contract drug research.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------

- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      STYLE/                                        INVESTMENT OBJECTIVES/POLICIES                                         PORTFOLIO
       TYPE                                                                                                                 ADVISOR/
                                                                                                                          SUB-ADVISOR
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    ------------------------------------------------------------------------------------------------ -----------------------
      SECTOR        ProFund VP Precious Metals:  seeks daily  investment  results,  before fees and expenses,  that   ProFund Advisors LLC
                    correspond to the daily  performance  of the  Philadelphia  Stock Exchange Gold & Silver Sector
                    Index.  The  Philadelphia  Stock Exchange Gold and Silver Sector Index measures the performance
                    of the gold and  silver  mining  industry  of the global  equity  market.  Component  companies
                    include  companies  involved in the mining and production of gold,  silver,  and other precious
                    metals,  precious  stones and pearls.  The Index does not include  producers  of  commemorative
                    medals and coins that are made of these metals.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    ------------------------------------------------------------------------------------------------ -----------------------
                    ProFund VP Real  Estate:  seeks  daily  investment  results,  before  fees and  expenses,  that
                    correspond to the daily  performance  of the Dow Jones U.S.  Real Estate  Index.  The Dow Jones
                    U.S. Real Estate Index measures the  performance of the real estate industry of the U.S. equity
                    market.   Component  companies  include  those  that  invest  directly  or  indirectly  through
      SECTOR        development,   management  or  ownership  of  shopping  malls,  apartment  buildings,   housing   ProFund Advisors LLC
                    developments  and, real estate  investment  trusts ("REITs") that invest in apartments,  office
                    and  retail  properties.  REITs are  passive  investment  vehicles  that  invest  primarily  in
                    income-producing real estate or real estate related loans or interests.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      SECTOR        ProFund VP  Semiconductor:  seeks daily  investment  results,  before fees and  expenses,  that   ProFund Advisors LLC
                    correspond to the daily  performance of the Dow Jones U.S.  Semiconductor  Index. The Dow Jones
                    U.S.  Semiconductor  Index measures the performance of the  semiconductor  industry of the U.S.
                    equity market.  Component  companies are engaged in the production of semiconductors  and other
                    integrated chips, as well as other related products such as circuit boards and motherboards.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    ------------------------------------------------------------------------------------------------ -----------------------
      SECTOR        ProFund  VP  Technology:  seeks  daily  investment  results,  before  fees and  expenses,  that   ProFund Advisors LLC
                    correspond to the daily  performance  of the Dow Jones U.S.  Technology  Sector Index.  The Dow
                    Jones U.S.  Technology  Sector Index measures the  performance of the technology  sector of the
                    U.S.  equity  market.  Component  companies  include  those  involved in  computers  and office
                    equipment,  software,   communications  technology,   semiconductors,   diversified  technology
                    services and internet services.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      SECTOR        ProFund VP Telecommunications:  seeks daily investment results,  before fees and expenses, that   ProFund Advisors LLC
                    correspond to the daily performance of the Dow Jones U.S.  Telecommunications Sector Index. The
                    Dow  Jones  U.S.   Telecommunications   Sector   Index   measures   the   performance   of  the
                    telecommunications  economic  sector of the U.S.  equity market.  Component  companies  include
                    fixed line communications and wireless communications companies.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      SECTOR        ProFund  VP  Utilities:  seeks  daily  investment  results,  before  fees  and  expenses,  that   ProFund Advisors LLC
                    correspond to the daily  performance  of the Dow Jones U.S.  Utilities  Sector  Index.  The Dow
                    Jones U.S.  Utilities Sector Index measures the performance of the utilities economic sector of
                    the U.S. equity market.  Component  companies  include  electric  utilities,  gas utilities and
                    water utilities.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------


- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      STYLE/                                        INVESTMENT OBJECTIVES/POLICIES                                         PORTFOLIO
       TYPE                                                                                                                 ADVISOR/
                                                                                                                          SUB-ADVISOR
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- --------------------------------------------------------------------------------------------------------------------------------------------
THE PROFUND VP PORTFOLIOS  DESCRIBED  BELOW ARE AVAILABLE AS  SUB-ACCOUNTS  TO ALL ANNUITY  OWNERS.  EACH  PORTFOLIO  PURSUES AN INVESTMENT
STRATEGY THAT SEEKS TO PROVIDE DAILY  INVESTMENT  RESULTS,  BEFORE FEES AND EXPENSES,  THAT MATCH A WIDELY FOLLOWED  INDEX,  INCREASED BY A
SPECIFIED FACTOR RELATIVE TO THE INDEX,  MATCH THE INVERSE OF THE INDEX OR THE INVERSE OF THE INDEX MULTIPLIED BY A SPECIFIED  FACTOR.  THE
INVESTMENT  STRATEGY OF SOME OF THE PORTFOLIOS MAY MAGNIFY (BOTH POSITIVELY AND NEGATIVELY) THE DAILY INVESTMENT  RESULTS OF THE APPLICABLE
INDEX.  IT IS RECOMMENDED  THAT ONLY THOSE ANNUITY OWNERS WHO ENGAGE A FINANCIAL  ADVISOR TO ALLOCATE THEIR ACCOUNT VALUE USING A STRATEGIC
OR TACTICAL  ASSET  ALLOCATION  STRATEGY  INVEST IN THESE  PORTFOLIOS.  WE HAVE  ARRANGED  THE  PORTFOLIOS  BASED ON THE INDEX ON WHICH ITS
INVESTMENT STRATEGY IS BASED.
- --------------------------------------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------------------------------------------
The S&P 500 Index(R)is a widely used measure of large-cap  U.S. stock market  performance.  It includes a  representative  sample of leading
companies in leading  industries.  Companies  are selected for inclusion in the Index by Standard & Poor's(R)for being U.S.  companies  with
adequate liquidity, appropriate market capitalization financial viability and public float.
- --------------------------------------------------------------------------------------------------------------------------------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    ProFund VP Bull: seeks daily investment results,  before fees and expenses,  that correspond to   ProFund Advisors LLC
     S&P 500        the daily performance of the S&P 500(R)Index.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    ProFund VP Bear: seeks daily investment results,  before fees and expenses,  that correspond to
                    the inverse  (opposite) of the daily  performance of the S&P 500(R)Index.  If ProFund VP Bear is
                    successful in meeting its objective,  its net asset value should gain  approximately  the same,
     S&P 500        on a  percentage  basis,  as any  decrease  in the S&P 500(R)Index when the Index  declines on a   ProFund Advisors LLC
                    given  day.  Conversely,  its  net  asset  value  should  lose  approximately  the  same,  on a
                    percentage basis, as any increase in the Index when the Index rises on a given day.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    ProFund VP UltraBull (f/k/a ProFund VP Bull Plus): seeks daily investment results,  before fees
                    and expenses,  that correspond to twice (200%) the daily  performance of the S&P 500(R)Index. If
                    the ProFund VP UltraBull is  successful  in meeting its  objective,  its net asset value should
                    gain  approximately  twice as much, on a percentage basis, as the S&P 500(R)Index when the Index
     S&P 500        rises on a given day.  Conversely,  its net asset  value  should  lose  approximately  twice as   ProFund Advisors LLC
                    much,  on a percentage  basis,  as the Index when the Index  declines on a given day.  Prior to
                    May 1, 2003,  ProFund VP UltraBull was named "ProFund VP Bull Plus" and sought daily investment
                    results that corresponded to one and one-half times the daily performance of the S&P 500(R)Index
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- --------------------------------------------------------------------------------------------------------------------------------------------
The NASDAQ-100 Index(R)is a market capitalization  weighted index that includes 100 of the largest domestic and international  non-financial
companies listed on The NASDAQ Stock Market.
- --------------------------------------------------------------------------------------------------------------------------------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
    NASDAQ 100      ProFund VP OTC: seeks daily investment  results,  before fees and expenses,  that correspond to   ProFund Advisors LLC
                    the daily performance of the NASDAQ-100  Index(R).  "OTC" in the name of ProFund VP OTC refers to
                    securities that do not trade on a U.S. securities exchange,  as registered under the Securities
                    Exchange Act of 1934.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
    NASDAQ 100      ProFund  VP  Short  OTC:  seeks  daily  investment  results,  before  fees and  expenses,  that   ProFund Advisors LLC
                    correspond to the inverse  (opposite) of the daily  performance  of the NASDAQ-100  Index(R).  If
                    ProFund VP Short OTC is  successful in meeting its  objective,  its net asset value should gain
                    approximately  the same, on a percentage  basis, as any decrease in the NASDAQ-100  Index(R)when
                    the Index declines on a given day.  Conversely,  its net asset value should lose  approximately
                    the same, on a percentage  basis,  as any increase in the Index when the Index rises on a given
                    day.  "OTC" in the name of  ProFund VP Short OTC  refers to  securities  that do not trade on a
                    U.S. securities exchange, as registered under the Securities Exchange Act of 1934.
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- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      STYLE/                                        INVESTMENT OBJECTIVES/POLICIES                                         PORTFOLIO
       TYPE                                                                                                                 ADVISOR/
                                                                                                                          SUB-ADVISOR
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
    NASDAQ 100      ProFund VP UltraOTC:  seeks daily investment results, before fees and expenses, that correspond   ProFund Advisors LLC
                    to twice  (200%) the daily  performance  of the  NASDAQ-100  Index(R).  If ProFund VP UltraOTC is
                    successful in meeting its  objective,  its net asset value should gain  approximately  twice as
                    much,  on a percentage  basis,  as the  NASDAQ-100  Index(R)when the Index rises on a given day.
                    Conversely,  its net asset  value  should lose  approximately  twice as much,  on a  percentage
                    basis,  as the Index when the Index  declines  on a given day.  "OTC" in the name of ProFund VP
                    UltraOTC refers to securities that do not trade on a U.S.  securities  exchange,  as registered
                    under the Securities Exchange Act of 1934.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- --------------------------------------------------------------------------------------------------------------------------------------------
The S&P MidCap 400 Index(R)is a widely used  measure of  mid-sized  company  U.S.  stock  market  performance.  Companies  are  selected for
inclusion  in the Index by  Standard & Poor's(R)for being U.S.  companies  with  adequate  liquidity,  appropriate  market  capitalization,
financial viability and public float.
- --------------------------------------------------------------------------------------------------------------------------------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
  S&P MIDCAP 400    ProFund VP Mid-Cap  Value:  seeks daily  investment  results,  before fees and  expenses,  that   ProFund Advisors LLC
                    correspond  to the  daily  performance  of the  S&P  MidCap  400/Barra  Value  Index(R).  The S&P
                    MidCap400/Barra  Value Index(R)is designed to differentiate  between fast growing  companies and
                    slower  growing or  undervalued  companies.  Standard & Poor's and Barra  cooperate to employ a
                    price-to-book value calculation whereby the market  capitalization of the S&P MidCap 400 Index(R)
                    is divided equally between growth and value.  The index is rebalanced twice per year.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    ProFund VP Mid-Cap  Growth:  seeks daily  investment  results,  before fees and expenses,  that
                    correspond to the daily  performance of the S&P MidCap 400/Barra Growth Index(R).  The S&P MidCap
                    400/Barra Growth Index(R)is designed to differentiate  between fast growing companies and slower
  S&P MIDCAP 400    growing  or  undervalued  companies.  Standard  &  Poor's  and  Barra  cooperate  to  employ  a   ProFund Advisors LLC
                    price-to-book value calculation whereby the market  capitalization of the S&P MidCap 400 Index(R)
                    is divided equally between growth and value.  The Index is rebalanced twice per year.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    ProFund VP  UltraMid-Cap:  seeks  daily  investment  results,  before fees and  expenses,  that
                    correspond to twice (200%) the daily  performance  of the S&P MidCap 400 Index(R).  If ProFund VP
                    UltraMid-Cap  is  successful  in  meeting  its  objective,  its net  asset  value  should  gain
  S&P MIDCAP 400    approximately  twice as much,  on a  percentage  basis,  as the S&P MidCap 400 Index(R)when the   ProFund Advisors LLC
                    Index rises on a given day.  Conversely,  its net asset value should lose  approximately  twice
                    as much, on a percentage basis, as the Index when the Index declines on a given day.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- --------------------------------------------------------------------------------------------------------------------------------------------
The S&P SmallCap 600 Index(R)consists of 600 domestic  stocks chosen for market size,  liquidity,  and industry group  representation.  The
Index comprises stocks from the industrial, utility, financial, and transportation sectors.
- --------------------------------------------------------------------------------------------------------------------------------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
 S&P SMALLCAP 600   ProFund VP Small-Cap Value:  seeks daily  investment  results,  before fees and expenses,  that   ProFund Advisors LLC
                    correspond  to the daily  performance  of the S&P  SmallCap  600/Barra  Value  Index(R).  The S&P
                    SmallCap  600/Barra Value Index(R)is designed to  differentiate  between fast growing  companies
                    and slower growing or undervalued  companies.  Standard & Poor's and Barra  cooperate to employ
                    a price-to-book  value  calculation  whereby the market  capitalization of the S&P SmallCap 600
                    Index(R)is divided equally between growth and value.  The Index is rebalanced twice per year.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
 S&P SMALLCAP 600   ProFund VP Small-Cap Growth:  seeks daily investment  results,  before fees and expenses,  that   ProFund Advisors LLC
                    correspond  to the daily  performance  of the S&P SmallCap  600/Barra  Growth  Index(R).  The S&P
                    SmallCap  600/Barra Growth Index(R)is designed to differentiate  between fast growing  companies
                    and slower growing or undervalued  companies.  Standard & Poor's and Barra  cooperate to employ
                    a price-to-book  value  calculation  whereby the market  capitalization of the S&P SmallCap 600
                    Index(R)is divided equally between growth and value.  The Index is rebalanced twice per year.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------

- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      STYLE/                                        INVESTMENT OBJECTIVES/POLICIES                                         PORTFOLIO
       TYPE                                                                                                                 ADVISOR/
                                                                                                                          SUB-ADVISOR
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- --------------------------------------------------------------------------------------------------------------------------------------------
The Russell 2000 Index(R)measures the performance of the 2,000 small companies in the Russell 3000 Index(R)representing  approximately 8% of
the total market  capitalization  of the Russell 3000 Index(R),  which in turn  represents  approximately  98% of the investable  U.S. equity
market.
- --------------------------------------------------------------------------------------------------------------------------------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
   RUSSELL 2000     ProFund VP  UltraSmall-Cap:  seeks daily  investment  results,  before fees and expenses,  that   ProFund Advisors LLC
                    correspond  to twice (200%) the daily  performance  of the Russell  2000(R)Index.  If ProFund VP
                    UltraSmall-Cap  is  successful  in meeting  its  objective,  its net asset  value  should  gain
                    approximately  twice as much, on a percentage  basis, as the Russell 2000 Index(R)when the Index
                    rises on a given day.  Conversely,  its net asset  value  should  lose  approximately  twice as
                    much, on a percentage basis, as the Index when the Index declines on a given day.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    ------------------------------------------------------------------------------------------------ -----------------------
 U.S. GOV'T BOND    ProFund VP U.S.  Government  Plus: seeks daily  investment  results,  before fees and expenses,   ProFund Advisors LLC
                    that  correspond  to one and  one-quarter  times  (125%) the daily  price  movement of the most
                    recently  issued  30-year U.S.  Treasury  Bond ("Long  Bond").  In  accordance  with its stated
                    objective,  the net asset value of ProFund VP U.S. Government Plus generally should decrease as
                    interest  rates  rise.  If  ProFund  VP U.S.  Government  Plus is  successful  in  meeting  its
                    objective,  its net asset value should gain  approximately  one and one-quarter times (125%) as
                    much,  on a  percentage  basis,  as any  daily  increase  in the  Long  Bond  on a  given  day.
                    Conversely,  its net asset value should lose  approximately one and one-quarter (125%) as much,
                    on a percentage basis, as any daily decrease in the Long Bond on a given day.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    ------------------------------------------------------------------------------------------------ -----------------------
 U.S. GOV'T BOND    ProFund VP Rising Rates Opportunity:  seeks daily investment results, before fees and expenses,   ProFund Advisors LLC
                    that correspond to one and one-quarter  times (125%) the inverse  (opposite) of the daily price
                    movement of the most recently  issued Long Bond. In accordance with its stated  objective,  the
                    net asset value of ProFund VP rising Rates  Opportunity  generally  should decrease as interest
                    rates fall. If ProFund VP Rising Rates  Opportunity  is  successful  in meeting its  objective,
                    its net asset value should gain  approximately  one and one-quarter  times (125%) as much, on a
                    percentage  basis, as any daily decrease in the Long Bond on a given day.  Conversely,  its net
                    asset  value  should  lose  approximately  one and  one-quarter  times  (125%)  as  much,  on a
                    percentage basis, as any daily increase in the Long Bond on a given day.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- --------------------------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------------------------

Each  portfolio of the First Defined  Portfolio Fund LLC invests in the securities of a relatively few number of issuers or in a particular
sector of the economy.  Since the assets of each  portfolio are invested in a limited number of issuers or a limited sector of the economy,
the net asset value of the portfolio may be more susceptible to a single adverse economic,  political or regulatory occurrence.  Certain of
the  portfolios  may also be subject to  additional  market risk due to their  policy of  investing  based on an  investment  strategy  and
generally not buying or selling  securities in response to market  fluctuations.  Each  portfolio's  relative lack of diversity and limited
ongoing management may subject Owners to greater market risk than other portfolios.

The stock selection date for each of the strategy  Portfolios of the First Defined  Portfolio Fund LLC is on or about December 31st of each
year. The holdings for each strategy  Portfolio  will be adjusted  annually on or about  December 31st in accordance  with the  Portfolio's
investment  strategy.  At that time,  the  percentage  relationship  among the shares of each issuer held by the Portfolio is  established.
Through the next one-year  period that  percentage  will be  maintained  as closely as  practicable  when the  Portfolio  makes  subsequent
purchases and sales of the securities.
- --------------------------------------------------------------------------------------------------------------------------------------------
- --------------------- ------------------------------------------------------------------------------------------------ ---------------------
     LARGE CAP        First Trust(R)10 Uncommon  Values:  seeks to provide  above-average  capital  appreciation.  The      First Trust
       BLEND          Portfolio  seeks to achieve its  objective  by  investing  primarily  in the ten common  stocks      Advisors L.P.
                      selected by the Investment  Policy Committee of Lehman Brothers Inc.  ("Lehman  Brothers") with
                      the assistance of the Research  Department of Lehman  Brothers which, in their opinion have the
                      greatest  potential for capital  appreciation  during the next year. The stocks included in the
                      Portfolio  are adjusted  annually on or about July 1st in  accordance  with the  selections  of
                      Lehman Brothers.
- --------------------- ------------------------------------------------------------------------------------------------ ---------------------

- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      STYLE/                                        INVESTMENT OBJECTIVES/POLICIES                                         PORTFOLIO
       TYPE                                                                                                                 ADVISOR/
                                                                                                                          SUB-ADVISOR
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    ------------------------------------------------------------------------------------------------ -----------------------
      INTER-        The  Prudential  Series  Fund,  Inc.  - SP  Jennison  International  Growth:  seeks to  provide        Prudential
  NATIONAL EQUITY   long-term   growth  of  capital.   The   Portfolio   pursues  its  objective  by  investing  in     Investments LLC/
                    equity-related  securities of foreign  issuers that the  Sub-advisor  believes will increase in    Jennison Associates
                    value over a period of years.  The  Portfolio  invests  primarily  in the common stock of large           LLC
                    and  medium-sized  foreign  companies.  Under normal  circumstances,  the Portfolio  invests at
                    least 65% of its total  assets in common  stock of foreign  companies  operating or based in at
                    least five different  countries.  The Portfolio  looks  primarily for stocks of companies whose
                    earnings are growing at a faster rate than other companies and that have  above-average  growth
                    in earnings and cash flow, improving profitability,  strong balance sheets, management strength
                    and strong  market  share for its  products.  The  Portfolio  also tries to buy such  stocks at
                    attractive prices in relation to their growth prospects.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------

"Standard & Poor's(R),"  "S&P(R)," "S&P 500(R),"  "Standard & Poor's 500," and "500" are trademarks of the  McGraw-Hill  Companies,  Inc. and
have been licensed for use by American Skandia Investment Services,  Incorporated.  The Portfolio is not sponsored,  endorsed,  sold or
promoted by Standard & Poor's and Standard & Poor's makes no representation regarding the advisability of investing in the Portfolio.

The First Trust(R)10 Uncommon  Values  portfolio is not  sponsored  or created by Lehman  Brothers,  Inc.  ("Lehman  Brothers").  Lehman
Brothers' only  relationship  to First Trust is the licensing of certain  trademarks and trade names of Lehman  Brothers and of the "10
Uncommon  Values" which is determined,  composed and calculated by Lehman Brothers without regard to First Trust or the First Trust(R)10
Uncommon Values portfolio.

Dow Jones has no  relationship  to the ProFunds VP, other than the licensing of the Dow Jones sector  indices and its service marks for
use in  connection  with the  ProFunds  VP. The  ProFunds VP are not  sponsored,  endorsed,  sold,  or promoted by Standard & Poor's or
NASDAQ, and neither Standard & Poor's nor NASDAQ makes any representations regarding the advisability of investing in the ProFunds VP.

WHAT ARE THE FIXED INVESTMENT OPTIONS?
We offer fixed investment options of different  durations during the accumulation  period.  These "Fixed Allocations" earn a guaranteed
fixed rate of interest  for a specified  period of time,  called the  "Guarantee  Period." In most states,  we offer Fixed  Allocations
with  Guarantee  Periods  from 1 to 10 years.  We may also offer  special  purpose  Fixed  Allocations  for use with  certain  optional
investment  programs.  We guarantee  the fixed rate for the entire  Guarantee  Period.  However,  if you  withdraw or transfer  Account
Value before the end of the Guarantee  Period,  we will adjust the value of your  withdrawal or transfer  based on a formula,  called a
"Market Value  Adjustment."  The Market Value  Adjustment  can either be positive or negative,  depending on the movement of applicable
interest  rates  payable on Strips of the  appropriate  duration.  Please  refer to the  section  entitled  "How does the Market  Value
Adjustment  Work?" for a  description  of the formula along with examples of how it is  calculated.  You may allocate  Account Value to
more than one Fixed Allocation at a time.

Fixed  Allocations may not be available in all states.  Availability of Fixed  Allocations is subject to change and may differ by state
and by the  annuity  product  you  purchase.  Please  call  American  Skandia at  1-800-680-8920  to  determine  availability  of Fixed
Allocations in your state and for your annuity product.

FEES AND CHARGES

WHAT ARE THE CONTRACT FEES AND CHARGES?

Contingent  Deferred Sales Charge:  We do not deduct a sales charge from Purchase  Payments you make to your Annuity.  However,  we may
deduct a  Contingent  Deferred  Sales Charge or CDSC if you  surrender  your  Annuity or when you make a partial  withdrawal.  The CDSC
reimburses us for expenses  related to sales and  distribution of the Annuity,  including  commissions,  marketing  materials and other
promotional  expenses.  The CDSC is  calculated as a percentage of your Purchase  Payment  being  surrendered  or withdrawn  during the
applicable  Annuity Year. For purposes of  calculating  the CDSC, we consider the year following the Issue Date of your Annuity as Year
1.  The amount of the CDSC decreases over time, measured from the Issue Date of the Annuity.  The CDSC percentages are shown below.

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

                           YEARS                   1             2             3            4             5+
                           ------------------ ------------- ------------- ------------ ------------- -------------
                           ------------------ ------------- ------------- ------------ ------------- -------------

                           CHARGE (%)             8.5%          8.0%         7.0%          6.0%          0.0%
                           ------------------ ------------- ------------- ------------ ------------- -------------


The CDSC period is based on the Issue Date of the Annuity,  not on the date each Purchase  Payment is applied to the Annuity.  Purchase
Payments  applied to the  Annuity  after the Issue Date do not have their own CDSC  period.  During the first four (4)  Annuity  Years,
under certain  circumstances  you can withdraw a limited amount of Account Value without paying a CDSC.  This is referred to as a "Free
Withdrawal."  After four (4) complete Annuity Years, you can surrender your Annuity or make a partial  withdrawal  without a CDSC being
deducted  from the amount  being  withdrawn.  Free  Withdrawals  are not treated as a withdrawal  of Purchase  Payments for purposes of
calculating the CDSC on a subsequent  withdrawal or surrender.  Withdrawals of amounts greater than the maximum Free Withdrawal  amount
are  treated as a  withdrawal  of Purchase  Payments  and will be assessed a CDSC  during  Annuity  Years 1 through 4. For  purposes of
calculating the CDSC on a surrender or a partial  withdrawal,  the Purchase Payments being withdrawn may be greater than your remaining
Account  Value or the amount of your  withdrawal  request.  This is most likely to occur if you have made prior  withdrawals  under the
Free Withdrawal provision or if your Account Value has declined in value due to negative market performance.

We may waive the CDSC under certain  medically-related  circumstances or when taking a Minimum  Distribution  from an Annuity purchased
as a "qualified"  investment.  Free Withdrawals,  Medically-Related  Surrenders and Minimum Distributions are each explained more fully
in the section entitled "Access to Your Account Value".

Transfer Fee:  Currently,  you may make twenty (20) free transfers between  investment options each Annuity Year. We will charge $10.00
for each  transfer  after the  twentieth in each Annuity Year.  We do not consider  transfers  made as part of a dollar cost  averaging
program when we count the twenty free  transfers.  Transfers  made as part of a  rebalancing,  market timing or third party  investment
advisory  service will be subject to the  twenty-transfer  limit.  However,  all transfers  made on the same day will be treated as one
(1)  transfer.  Renewals or transfers of Account Value from a Fixed  Allocation  at the end of its Guarantee  Period are not subject to
the  Transfer Fee and are not counted  toward the twenty free  transfers.  We may reduce the number of free  transfers  allowable  each
Annuity Year (subject to a minimum of eight) without  charging a Transfer Fee unless you make use of electronic  means to transmit your
transfer  requests.  We may eliminate the Transfer Fee for transfer  requests  transmitted  electronically  or through other means that
reduce our processing costs.

Annual  Maintenance Fee: During the accumulation  period we deduct an Annual  Maintenance Fee. The Annual  Maintenance Fee is $35.00 or
2% of your Account Value invested in the variable  investment  options,  whichever is less.  This fee will be deducted  annually on the
anniversary  of the Issue Date of your Annuity or, if you surrender  your Annuity  during the Annuity Year,  the fee is deducted at the
time of  surrender.  Currently,  the Annual  Maintenance  Fee is only  deducted  if your  Account  Value is less than  $100,000  on the
anniversary  of the Issue Date or at the time of surrender.  We may increase the Annual  Maintenance  Fee.  However,  any increase will
only apply to Annuities issued after the date of the increase.

Tax  Charges:  Several  states  and some  municipalities  charge  premium  taxes or  similar  taxes.  The  amount of tax will vary from
jurisdiction  to  jurisdiction  and is subject to change.  The tax charge  currently  ranges up to 3 1/2%.  We  generally  will deduct the
amount of tax payable at the time the tax is  imposed,  but may also decide to deduct tax  charges  from each  Purchase  Payment at the
time of a  withdrawal  or  surrender  of your Annuity or at the time you elect to begin  receiving  annuity  payments.  We may assess a
charge against the Sub-accounts and the Fixed Allocations equal to any taxes which may be imposed upon the separate accounts.

WHAT CHARGES APPLY SOLELY TO THE VARIABLE INVESTMENT OPTIONS?

Insurance  Charge:  We deduct an Insurance Charge daily against the average daily assets allocated to the  Sub-accounts.  The Insurance
Charge is the combination of the Mortality & Expense Risk Charge (1.50%) and the  Administration  Charge  (0.15%).  The total charge is
equal to 1.65% on an annual  basis.  The  Insurance  Charge is intended to  compensate  American  Skandia for  providing  the insurance
benefits under the Annuity,  including the Annuity's basic death benefit that provides  guaranteed  benefits to your beneficiaries even
if the market declines and the risk that persons we guarantee  annuity  payments to will live longer than our  assumptions.  The charge
also covers administrative costs associated with providing the Annuity benefits,  including  preparation of the contract,  confirmation
statements,  annual account  statements and annual reports,  legal and accounting fees as well as various  related  expenses.  Finally,
the charge covers the risk that our  assumptions  about the mortality  risks and expenses  under this Annuity are incorrect and that we
have agreed not to increase  these  charges over time  despite our actual  costs.  We may  increase the portion of the total  Insurance
Charge that is deducted for  administrative  costs;  however,  any increase  will only apply to Annuities  issued after the date of the
increase.

American  Skandia may make a profit on the  Insurance  Charge if, over time,  the actual cost of  providing  the  guaranteed  insurance
obligations  under the  Annuity  are less than the amount we deduct  for the  Insurance  Charge.  To the extent we make a profit on the
Insurance Charge,  such profit may be used for any other corporate  purpose,  including payment of other expenses that American Skandia
incurs in promoting, distributing, issuing and administering the Annuity.

The  Insurance  Charge  is not  deducted  against  assets  allocated  to a Fixed  Allocation.  However,  the  amount we credit to Fixed
Allocations may also reflect similar assumptions about the insurance guarantees provided under the Annuity.

Optional Benefits:  If you elect to purchase one or more optional  benefits,  we will deduct an additional charge on a daily basis from
your Account Value allocated to the Sub-accounts  with the exception of the Guaranteed  Minimum Income Benefit which charge is assessed
against the Protected  Income Value and deducted  annually in arrears.  The charge for each optional benefit is deducted in addition to
the Insurance Charge due to the increased  insurance risk associated with the optional  benefits.  The additional charge is included in
the daily  calculation of the Unit Price for each  Sub-account.  Please refer to the sections  entitled  "Living Benefit  Programs" and
"Death Benefit" for a description of the charge for each Optional Benefit.

WHAT CHARGES ARE ASSESSED BY THE PORTFOLIOS?
We do not assess any charges  directly  against the  Portfolios.  However,  each  Portfolio  charges a total annual fee comprised of an
investment  management fee,  operating  expenses and any distribution and service (12b-1) fees that may apply.  These fees are deducted
daily by each  Portfolio  before it provides  American  Skandia  with the net asset value as of the close of  business  each day.  More
detailed  information  about fees and charges can be found in the  prospectuses  for the  Portfolios.  Please  also see  "Service  Fees
Payable by Underlying Funds".

WHAT CHARGES APPLY TO THE FIXED ALLOCATIONS?
No specific fee or expenses are deducted  when  determining  the rate we credit to a Fixed  Allocation.  However,  for some of the same
reasons that we deduct the Insurance  Charge  against  Account Value  allocated to the  Sub-accounts,  we also take into  consideration
mortality,  expense,  administration,  profit and other factors in determining the interest rates we credit to Fixed  Allocations.  Any
CDSC or Tax Charge  applies to amounts that are taken from the variable  investment  options or the Fixed  Allocations.  A Market Value
Adjustment may also apply to transfers, certain withdrawals, surrender or annuitization from a Fixed Allocation.

WHAT CHARGES APPLY IF I CHOOSE AN ANNUITY PAYMENT OPTION?
In certain  states a tax is due if and when you exercise  your right to receive  periodic  annuity  payments.  The amount  payable will
depend on the applicable  jurisdiction and on the annuity payment option you select.  If you select a fixed payment option,  the amount
of each fixed  payment  will depend on the Account  Value of your Annuity when you elected to  annuitize.  There is no specific  charge
deducted from these payments;  however,  the amount of each annuity payment reflects  assumptions about our insurance expenses.  If you
select a  variable  payment  option  that we may offer,  then the amount of your  benefits  will  reflect  changes in the value of your
Annuity and will continue to be subject to an insurance charge.

EXCEPTIONS/REDUCTIONS TO FEES AND CHARGES
We may reduce or  eliminate  certain  fees and  charges  or alter the manner in which the  particular  fee or charge is  deducted.  For
example,  we may  reduce  the  amount of the CDSC or the  length of time it  applies,  reduce or  eliminate  the  amount of the  Annual
Maintenance Fee or reduce the portion of the total Insurance  Charge that is deducted as an  Administration  Charge.  Generally,  these
types of  changes  will be based on a  reduction  to our  sales,  maintenance  or  administrative  expenses  due to the  nature  of the
individual  or group  purchasing  the Annuity.  Some of the factors we might  consider in making such a decision  are: (a) the size and
type of group;  (b) the number of Annuities  purchased by an Owner;  (c) the amount of Purchase  Payments or  likelihood  of additional
Purchase  Payments;  and/or (d) other  transactions where sales,  maintenance or administrative  expenses are likely to be reduced.  We
will not discriminate  unfairly between Annuity  purchasers if and when we reduce the portion of the Insurance Charge attributed to the
charge covering administrative costs.

PURCHASING YOUR ANNUITY

WHAT ARE OUR REQUIREMENTS FOR PURCHASING THE ANNUITY?

Initial Purchase Payment:  You must make a minimum initial Purchase Payment of $10,000.  However,  if you decide to make payments under
a systematic  investment or "bank drafting"  program,  we will accept a lower initial Purchase Payment provided that,  within the first
Annuity Year, you make at least $10,000 in total Purchase Payments.

Where  allowed by law,  initial  Purchase  Payments in excess of  $1,000,000  require our approval  prior to  acceptance.  We may apply
certain limitations and/or  restrictions on the Annuity as a condition of our acceptance,  including limiting the liquidity features or
the Death Benefit protection provided under the Annuity,  limiting the right to make additional Purchase Payments,  changing the number
of transfers  allowable under the Annuity or restricting the Sub-accounts  that are available.  Other limitations  and/or  restrictions
may apply.

Except as noted below,  Purchase  Payments  must be  submitted  by check drawn on a U.S.  bank,  in U.S.  dollars,  and made payable to
American  Skandia.  Purchase  Payments  may  also  be  submitted  via  1035  exchange  or  direct  transfer  of  funds.  Under  certain
circumstances,  Purchase  Payments may be  transmitted  to American  Skandia via wiring funds  through your  investment  professional's
broker-dealer  firm.  Additional  Purchase  Payments may also be applied to your Annuity under an  arrangement  called "bank  drafting"
where you  authorize us to deduct money  directly  from your bank account.  We call our bank  drafting  program  "Auto  Saver".  We may
reject any payment if it is received in an unacceptable form.  Our acceptance of a check is subject to our ability to collect funds.

Age Restrictions:  The Owner must be age 85 or under as of the Issue Date of the Annuity.  If the Annuity is owned jointly,  the oldest
of the Owners must be age 85 or under on the Issue Date. If the Annuity is owned by an entity,  the  Annuitant  must be age 85 or under
as of the Issue Date.  You should  consider your need to access your Account Value and whether the  Annuity's  liquidity  features will
satisfy that need.  If you take a  distribution  prior to age 591/2, you may be subject to a 10% penalty in addition to ordinary  income
taxes on any gain.  The  availability  of  certain  optional  benefits  may vary based on the age of the Owner on the Issue Date of the
Annuity.

Owner, Annuitant and Beneficiary  Designations:  On your Application,  we will ask you to name the Owner(s),  Annuitant and one or more
Beneficiaries for your Annuity.

|X|      Owner:  The  Owner(s)  holds all  rights  under the  Annuity.  You may name  more than one Owner in which  case all  ownership
       rights are held jointly.  However,  this Annuity does not provide a right of survivorship.  Refer to the Glossary of Terms for a
       complete description of the term "Owner."
|X|      Annuitant:  The  Annuitant  is the person we agree to make  annuity  payments  to and upon whose life we continue to make such
       payments.  You must name an Annuitant who is a natural  person.  We do not accept a designation of joint  Annuitants  during the
       accumulation  period. Where allowed by law, you may name one or more Contingent  Annuitants.  A Contingent Annuitant will become
       the Annuitant if the Annuitant dies before the Annuity Date.  Please refer to the discussion of  "Considerations  for Contingent
       Annuitants" in the Tax Considerations section of the Prospectus.
|X|      Beneficiary:  The  Beneficiary  is the person(s) or entity you name to receive the death  benefit.  If no beneficiary is named
       the death benefit will be paid to you or your estate.

Your right to make certain  designations  may be limited if your Annuity is to be used as an IRA or other  "qualified"  investment that
is given  beneficial  tax  treatment  under  the Code.  You  should  seek  competent  tax  advice on the  income,  estate  and gift tax
implications of your designations.

MANAGING YOUR ANNUITY

MAY I CHANGE THE OWNER, ANNUITANT AND BENEFICIARY DESIGNATIONS?
You may change the Owner,  Annuitant  and  Beneficiary  designations  by sending us a request in writing.  Where  allowed by law,  such
changes will be subject to our acceptance.  Some of the changes we will not accept include, but are not limited to:
|X|      a new Owner  subsequent to the death of the Owner or the first of any joint Owners to die,  except where a  spouse-Beneficiary
     has become the Owner as a result of an Owner's death;
|X|      a new Annuitant subsequent to the Annuity Date;
|X|      for "non-qualified" investments, a new Annuitant prior to the Annuity Date if the Annuity is owned by an entity; and
|X|      a change in Beneficiary if the Owner had previously made the designation irrevocable.

Spousal Owners/Spousal Beneficiaries
If an Annuity is co-owned by spouses,  we will assume that the sole primary  Beneficiary  is the  surviving  spouse unless you elect an
alternative  Beneficiary  designation.  Unless  you elect an  alternative  Beneficiary  designation,  upon the death of either  spousal
Owner,  the  surviving  spouse may elect to assume  ownership of the Annuity  instead of taking the Death  Benefit  payment.  The Death
Benefit  that  would  have been  payable  will be the new  Account  Value of the  Annuity  as of the date of due proof of death and any
required proof of a spousal  relationship.  As of the date the assumption is effective,  the surviving  spouse will have all the rights
and benefits that would be available  under the Annuity to a new purchaser of the same  attained age. For purposes of  determining  any
future Death Benefit for the  beneficiary  of the surviving  spouse,  the new Account Value will be considered as the initial  Purchase
Payment.  No CDSC  will  apply to the new  Account  Value.  However,  any  additional  Purchase  Payments  applied  after  the date the
assumption is effective will be subject to all provisions of the Annuity, including the CDSC when applicable.

Spousal Contingent Annuitant
If the Annuity is owned by an entity and the  surviving  spouse is named as a Contingent  Annuitant,  upon the death of the  Annuitant,
the surviving  spouse will become the  Annuitant.  No Death Benefit is payable upon the death of the  Annuitant.  However,  the Account
Value of the Annuity as of the date of due proof of death of the Annuitant  (and any required proof of the spousal  relationship)  will
reflect the amount that would have been payable had a Death Benefit been paid.


MAY I RETURN THE ANNUITY IF I CHANGE MY MIND?

If after  purchasing  your  Annuity  you change  your mind and decide that you do not want it, you may return it to us within a certain
period of time known as a right to cancel  period.  This is often  referred to as a  "free-look."  Depending  on the state in which you
purchased your Annuity and, in some states,  if you purchased the Annuity as a replacement  for a prior  contract,  the right to cancel
period may be ten (10) days,  twenty-one  (21) days or longer,  measured from the time that you received  your  Annuity.  If you return
your Annuity during the applicable  period,  we will refund your current  Account Value plus any tax charge  deducted.  This amount may
be higher or lower than your  original  Purchase  Payment.  Where  required by law, we will return your  current  Account  Value or the
amount of your initial  Purchase  Payment,  whichever  is greater.  The same rules may apply to an Annuity that is purchased as an IRA.
In any situation  where we are required to return the greater of your Purchase  Payment or Account Value,  we may allocate your Account
Value to the AST Money Market  Sub-account  during the right to cancel period and for a reasonable  additional  amount of time to allow
for delivery of your Annuity.

MAY I MAKE ADDITIONAL PURCHASE PAYMENTS?
The minimum  amount that we accept as an  additional  Purchase  Payment is $100 unless you  participate  in "Auto  Saver" or a periodic
purchase  payment  program.  We will  allocate  any  additional  Purchase  Payments you make  according to your most recent  allocation
instructions, unless you request new allocations when you submit a new Purchase Payment.

MAY I MAKE SCHEDULED PAYMENTS DIRECTLY FROM MY BANK ACCOUNT?
You can make  additional  Purchase  Payments to your  Annuity by  authorizing  us to deduct money  directly  from your bank account and
applying it to your Annuity.  This type of program is often called "bank  drafting".  We call our bank  drafting  program "Auto Saver".
Purchase  Payments  made through bank  drafting may only be allocated  to the  variable  investment  options when  applied.  Auto Saver
allows you to invest in your Annuity with a lower  initial  Purchase  Payment,  as long as you  authorize  payments  that will equal at
least $10,000  during the first 12 months of your Annuity.  We may suspend or cancel bank drafting  privileges if sufficient  funds are
not available from the applicable financial institution on any date that a transaction is scheduled to occur.

MAY I MAKE PURCHASE PAYMENTS THROUGH A SALARY REDUCTION PROGRAM?
These types of programs are only available with certain types of qualified  investments.  If your employer sponsors such a program,  we
may agree to accept  periodic  Purchase  Payments  through  a salary  reduction  program  as long as the  allocations  are made only to
variable investment options and the periodic Purchase Payments received in the first year total at least $10,000.

MANAGING YOUR ACCOUNT VALUE

HOW AND WHEN ARE PURCHASE PAYMENTS INVESTED?
(See "Valuing Your Investment" for a description of our procedure for pricing initial and subsequent Purchase Payments.)

Initial  Purchase  Payment:  Once we accept your  application,  we invest your net Purchase  Payment in the  Annuity.  The net Purchase
Payment is your initial  Purchase  Payment  minus any tax charges  that may apply.  On your  application  we ask you to provide us with
instructions  for allocating your Account Value.  You can allocate  Account Value to one or more variable  investment  options or Fixed
Allocations.

In those states where we are required to return your Purchase  Payment if you exercise  your right to return the Annuity,  we initially
allocate all amounts that you choose to allocate to the variable  investment  options to the AST Money Market  Sub-account.  At the end
of the right to cancel  period we will  reallocate  your Account Value  according to your most recent  allocation  instructions.  Where
permitted by law, we will allocate your Purchase Payments according to your initial  instructions,  without  temporarily  allocating to
the AST Money Market  Sub-account.  To do this,  we will ask that you execute our form called a "return  waiver" that  authorizes us to
allocate your Purchase  Payment to your chosen  Sub-accounts  immediately.  If you submit the "return waiver" and then decide to return
your  Annuity  during the right to cancel  period,  you will receive  your  current  Account  Value which may be more or less than your
initial Purchase Payment (see "May I Return the Annuity if I Change my Mind?").

Subsequent  Purchase  Payments:  We will  allocate  any  additional  Purchase  Payments you make  according to your current  allocation
instructions.  If any rebalancing or asset allocation  programs are in effect,  the allocation  should conform with such a program.  We
assume  that your  current  allocation  instructions  are  valid  for  subsequent  Purchase  Payments  until you make a change to those
allocations or request new allocations when you submit a new Purchase Payment.

ARE THERE RESTRICTIONS OR CHARGES ON TRANSFERS BETWEEN INVESTMENT OPTIONS?
During the accumulation  period you may transfer  Account Value between  investment  options.  Transfers are not subject to taxation on
any gain.  We currently  limit the number of  Sub-accounts  you can invest in at any one time to twenty (20).  However,  you can invest
in an unlimited  number of Fixed  Allocations.  We may require a minimum of $500 in each  Sub-account you allocate  Account Value to at
the time of any  allocation or transfer.  If you request a transfer and, as a result of the transfer,  there would be less than $500 in
the Sub-account,  we may transfer the remaining Account Value in the Sub-account pro rata to the other investment  options to which you
transferred.

We  may  impose  specific  restrictions  on  financial  transactions  for  certain  Portfolios  based  on  the  Portfolio's  investment
restrictions.  Currently,  any purchase,  redemption or transfer involving the ProFunds VP Sub-accounts must be received by us no later
than one hour  prior to any  announced  closing  of the  applicable  securities  exchange  (generally,  3:00 p.m.  Eastern  time) to be
processed on the current  Valuation Day. The "cut-off" time for such financial  transactions  involving a ProFunds VP Sub-account  will
be extended to1/2hour prior to any announced  closing  (generally,  3:30 p.m. Eastern time) for transactions  submitted  electronically
through American Skandia's Internet website (www.americanskandia.prudential.comcom).

Currently,  we charge $10.00 for each transfer  after the twentieth  (20th) in each Annuity Year,  including  transfers made as part of
any  rebalancing,  market timing,  asset  allocation or similar program which you have  authorized.  Transfers made as part of a dollar
cost  averaging  program do not count  toward the twenty free  transfer  limit.  Renewals or  transfers  of Account  Value from a Fixed
Allocation  at the end of its  Guarantee  Period are not subject to the  transfer  charge.  We may reduce the number of free  transfers
allowable  each Annuity Year (subject to a minimum of eight)  without  charging a Transfer Fee unless you make use of electronic  means
to transmit your transfer  requests.  We may eliminate the Transfer Fee for transfer  requests  transmitted  electronically  or through
other means that reduce our processing costs.

We reserve the right to limit the number of transfers  in any Annuity  Year for all  existing or new Owners.  We also reserve the right
to limit the number of  transfers  in any Annuity  Year or to refuse any  transfer  request  for an Owner or certain  Owners if: (a) we
believe that  excessive  trading or a specific  transfer  request or group of transfer  requests may have a detrimental  effect on Unit
Values or the share prices of the  Portfolios;  or (b) we are informed by one or more of the Portfolios that the purchase or redemption
of  shares  must be  restricted  because  of  excessive  trading  or a  specific  transfer  or group of  transfers  is deemed to have a
detrimental  effect on the share prices of affected  Portfolios.  Without  limiting the above, the most likely scenario where either of
the above could occur would be if the  aggregate  amount of a trade or trades  represented a relatively  large  proportion of the total
assets of a  particular  Portfolio.  Under such a  circumstance,  we will process  transfers  according to our rules then in effect and
provide notice if the transfer request was denied.  If a transfer request is denied, a new transfer request may be required.

DO YOU OFFER DOLLAR COST AVERAGING?
Yes. We offer Dollar Cost Averaging during the accumulation  period.  Dollar Cost Averaging  allows you to  systematically  transfer an
amount  each month from one  investment  option to one or more other  investment  options.  You can choose to transfer  earnings  only,
principal plus earnings or a flat dollar amount.  Dollar Cost Averaging  allows you to invest  regularly each month,  regardless of the
current unit value (or price) of the  Sub-account(s)  you invest in. This  enables you to purchase  more units when the market price is
low and fewer units when the market price is high.  This may result in a lower  average cost of units over time.  However,  there is no
guarantee  that  Dollar Cost  Averaging  will result in a profit or protect  against a loss in a declining  market.  We do not deduct a
charge for participating in a Dollar Cost Averaging program.

You must have a minimum Account Value of at least $10,000 to enroll in a Dollar Cost Averaging program.

You can Dollar Cost Average from variable  investment  options or Fixed  Allocations.  Dollar Cost Averaging from Fixed  Allocations is
subject to a number of rules that include, but are not limited to the following:
|X|      You may only use Fixed Allocations with Guarantee Periods of 1, 2 or 3 years.
|X|      You may only Dollar Cost Average  earnings or principal plus earnings.  If transferring  principal plus earnings,  the program
     must be designed to last the entire Guarantee Period for the Fixed Allocation.
|X|      Dollar Cost Averaging transfers from Fixed Allocations are not subject to a Market Value Adjustment.

NOTE:  When a Dollar  Cost  Averaging  program is  established  from a Fixed  Allocation,  the fixed rate of interest we credit to your
Account  Value is applied to a  declining  balance due to the  transfers  of Account  Value to the  Sub-accounts  during the  Guarantee
Period.  This will reduce the effective rate of return on the Fixed Allocation over the Guarantee Period.

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American  Skandia may offer Fixed  Allocations with Guarantee  Periods of 6 months or 12 months  exclusively for use with a Dollar Cost
Averaging program ("DCA Fixed  Allocations").  DCA Fixed  Allocations are designed to automatically  transfer Account Value in either 6
or 12 payments under a Dollar Cost  Averaging  program.  Dollar Cost  Averaging  transfers will begin on the day following the date the
DCA Fixed  Allocation is established  and each month  following until the entire  principal  amount plus earnings is  transferred.  DCA
Fixed  Allocations may only be established  with your initial Purchase Payment or additional  Purchase  Payments.  You may not transfer
existing Account Value to a DCA Fixed  Allocation.  We reserve the right to terminate  offering these special purpose Fixed Allocations
at any time.
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Account  Value  allocated  to the DCA Fixed  Allocation  will be  transferred  to the  Sub-accounts  you choose  under the Dollar  Cost
Averaging  program.  If you terminate  the Dollar Cost  Averaging  program  before the entire  principal  amount plus earnings has been
transferred to the  Sub-account(s),  you must transfer all remaining Account Value to any other investment  option.  Unless you provide
alternate  instructions  at the time you terminate the Dollar Cost  Averaging  program,  Account Value will be  transferred  to the AST
Money Market  Sub-account.  Transfers from Fixed  Allocations  as part of a Dollar Cost  Averaging  program are not subject to a Market
Value  Adjustment.  However,  a Market Value Adjustment will apply if you terminate the Dollar Cost Averaging program before the entire
principal amount plus earnings has been transferred to the Sub-account(s).

DO YOU OFFER ANY AUTOMATIC REBALANCING PROGRAMS?
Yes.  During the  accumulation  period,  we offer  automatic  rebalancing  among the variable  investment  options you choose.  You can
choose  to have your  Account  Value  rebalanced  quarterly,  semi-annually,  or  annually.  On the  appropriate  date,  your  variable
investment  options are rebalanced to the allocation  percentages you request.  For example,  over time the performance of the variable
investment  options  will  differ,  causing  your  percentage  allocations  to shift.  With  automatic  rebalancing,  we  transfer  the
appropriate  amount  from the  "overweighted"  Sub-accounts  to the  "underweighted"  Sub-accounts  to return your  allocations  to the
percentages  you  request.  If you request a transfer  from or into any  variable  investment  option  participating  in the  automatic
rebalancing  program,  we will assume that you wish to change your rebalancing  percentages as well, and will automatically  adjust the
rebalancing percentages in accordance with the transfer unless we receive alternate instructions from you.

You must have a minimum Account Value of at least $10,000 to enroll in automatic  rebalancing.  All  rebalancing  transfers made on the
same day as part of an automatic  rebalancing  program are  considered as one transfer when counting the number of transfers  each year
toward the maximum number of free transfers. We do not deduct a charge for participating in an automatic rebalancing program.

DO YOU OFFER ANY ASSET ALLOCATION PROGRAMS?
Yes. During the  accumulation  period,  we offer two different asset allocation  programs  designed for American Skandia by Morningstar
Associates,  LLC.  Each program is available to Annuity  Owners at no additional  charge.  Each program is designed as a tool to enable
you and  your  investment  professional  to  develop  an  asset  allocation  program  that is  appropriate  for  you.  Your  investment
professional  will help you to complete an investor  questionnaire  that will help you and your  investment  professional  to determine
whether  participating  in a program  is  appropriate  for you and to  determine  your  investment  style from which you can choose the
available model  portfolios.  We offer one program where you and your investment  professional  choose from the available  Sub-accounts
for each asset class in the model  portfolio you have chosen based on your answers to the  questionnaire.  You may change your selected
Sub-accounts  at any time.  We offer a second  program  where  the  Sub-accounts  for each  asset  class in each  model  portfolio  are
designated  based  on an  objective  evaluation  of  the  available  Sub-accounts.  If you  elect  the  second  program,  the  selected
Sub-accounts  within a model portfolio may change  periodically.  Under both programs,  assets  allocated to the program are rebalanced
on a periodic basis based on suggested  changes to the allocation  percentages  for an asset class within a model portfolio or based on
changes in the value of the Sub-accounts.  Each asset allocation  program is subject to additional  limitations and restrictions  which
are more fully described in the enrollment form for the programs.

Asset  allocation  is a  sophisticated  method of  diversification  which  allocates  assets  among  asset  classes  in order to manage
investment  risk and enhance  returns over the long term.  However,  asset  allocation does not guarantee a profit or protect against a
loss. You are not obligated to  participate or to invest  according to the program  recommendations.  American  Skandia does not intend
to provide  any  personalized  investment  advice in  connection  with these  programs  and you  should not rely on these  programs  as
providing  individualized  investment  recommendations  to you.  The asset  allocation  programs  do not  guarantee  better  investment
results.  We reserve  the right to  terminate  or change the asset  allocation  programs  at any time.  You  should  consult  with your
investment professional before electing any asset allocation program.

DO YOU OFFER A PROGRAM DESIGNED TO GUARANTEE A "RETURN OF PREMIUM" AT A FUTURE DATE?
Yes.  We offer a  program  for  investors  who wish to  invest in the  variable  investment  options  but also  wish to  protect  their
principal,  at least as of a specific  date in the future.  You may not want to use this program if you expect to begin taking  annuity
payments  before the program would be completed.  See Living  Benefit  Programs  section of this  Prospectus  for a description  of the
Guaranteed Return Option Plus optional benefit, which also offers protection of principal.

Balanced Investment Program
We offer a balanced  investment  program  where a portion of your Account  Value is allocated to a Fixed  Allocation  and the remaining
Account Value is allocated to the variable  investment  options that you select.  When you enroll in the Balanced  Investment  Program,
you choose the  duration  that you wish the  program to last.  This  determines  the  duration  of the  Guarantee  Period for the Fixed
Allocation.  Based on the fixed rate for the  Guarantee  Period  chosen,  we calculate  the portion of your Account  Value that must be
allocated to the Fixed Allocation to grow to a specific  "principal amount" (such as your initial Purchase  Payment).  We determine the
amount  based on the rates then in effect for the  Guarantee  Period you  choose.  If you  continue  the  program  until the end of the
Guarantee  Period and make no withdrawals or transfers,  at the end of the Guarantee  Period,  the Fixed  Allocation will have grown to
equal the  "principal  amount".  Withdrawals  or  transfers  from the Fixed  Allocation  before the end of the  Guarantee  Period  will
terminate  the program and may be subject to a Market Value  Adjustment.  You can transfer the Account  Value that is not  allocated to
the Fixed  Allocation  between any of the  Sub-accounts  available  under the  Annuity.  Account  Value you  allocate  to the  variable
investment  options  is  subject  to market  fluctuations  and may  increase  or  decrease  in  value.  We do not  deduct a charge  for
participating in the Balanced Investment Program.

         Example
         Assume you invest  $100,000.  You choose a 10-year program and allocate a portion of your Account Value to a Fixed  Allocation
         with a 10-year  Guarantee Period.  The rate for the 10-year  Guarantee Period is 5.33%*.  Based on the fixed interest rate for
         the Guarantee  Period chosen,  the factor is 0.594948 for  determining how much of your Account Value will be allocated to the
         Fixed  Allocation.  That means that  $59,495  will be  allocated  to the Fixed  Allocation  and the  remaining  Account  Value
         ($41,505)  will be  allocated to the variable  investment  options.  Assuming  that you do not make any  withdrawals  from the
         Fixed  Allocation,  it will grow to $100,000 at the end of the Guarantee  Period. Of course we cannot predict the value of the
         remaining Account Value that was allocated to the variable investment options.

*        The rate in this example is hypothetical and may not reflect the current rate for Guarantee Periods of this duration.

MAY I AUTHORIZE MY INVESTMENT PROFESSIONAL TO MANAGE MY ACCOUNT?
Yes.  You may  authorize  your  investment  professional  to direct the  allocation  of your  Account  Value and to  request  financial
transactions  between  investment  options while you are living,  subject to our rules. You must contact us immediately if and when you
revoke such authority.  We will not be responsible for acting on instructions  from your investment  professional if you fail to inform
us that such person's  authority has been revoked.  We may also suspend,  cancel or limit these  privileges at any time. We will notify
you if we do.

We or an affiliate of ours may provide administrative support to licensed,  registered investment  professionals or investment advisors
who you authorize to make financial  transactions on your behalf.  These investment  professionals may be firms or persons who also are
appointed by us as authorized  sellers of the Annuity.  However,  we do not offer advice about how to allocate your Account Value under
any  circumstance.  Any  investment  professionals  you engage to provide  advice  and/or make  transfers  for you is not acting on our
behalf.  We are not  responsible for any  recommendations  such investment  professionals  make, any market timing or asset  allocation
programs they choose to follow or any specific transfers they make on your behalf.

We may require  investment  professionals  or investment  advisors,  who are authorized by multiple  contract  owners to make financial
transactions,  to enter into an  administrative  agreement with American  Skandia as a condition of our accepting  transactions on your
behalf.  The  administrative  agreement may impose  limitations on the investment  professional's  or investment  advisor's  ability to
request  financial  transactions on your behalf.  These  limitations  are intended to minimize the detrimental  impact of an investment
professional  who is in a position to  transfer  large  amounts of money for  multiple  clients in a  particular  Portfolio  or type of
portfolio or to comply with specific  restrictions or limitations  imposed by a Portfolio(s) of American  Skandia.  The  administrative
agreement  may limit  the  available  investment  options,  require  advance  notice of large  transactions,  or impose  other  trading
limitations on your investment  professional.  Your  investment  professional  will be informed of all such  restrictions on an ongoing
basis.  We may also require that your  investment  professional  transmit  all  financial  transactions  using the  electronic  trading
functionality  available  through our Internet  website  (www.americanskandia.prudential.com).  Limitations  that we may impose on your
investment  professional or investment advisor under the terms of the administrative  agreement do not apply to financial  transactions
requested by an Owner on their own behalf, except as otherwise described in this Prospectus.

HOW DO THE FIXED INVESTMENT OPTIONS WORK?

We credit  the fixed  interest  rate to the Fixed  Allocation  throughout  a set  period of time  called a  "Guarantee  Period."  Fixed
Allocations  currently are offered with Guarantee  Periods from 1 to 10 years.  We may make Fixed  Allocations  of different  durations
available in the future,  including Fixed Allocations  offered  exclusively for use with certain optional  investment  programs.  Fixed
Allocations  may not be available in all states and may not always be available for all Guarantee  Periods  depending on market factors
and other considerations.

The interest  rate credited to a Fixed  Allocation  is the rate in effect when the  Guarantee  Period begins and does not change during
the Guarantee  Period.  The rates are an effective annual rate of interest.  We determine the interest rates for the various  Guarantee
Periods.  At the time that we confirm  your Fixed  Allocation,  we will  advise  you of the  interest  rate in effect and the date your
Fixed  Allocation  matures.  We may change the rates we credit new Fixed  Allocations at any time. Any change in interest rate does not
affect  Fixed  Allocations  that  were in  effect  before  the date of the  change.  To  inquire  as to the  current  rates  for  Fixed
Allocations, please call 1-800-766-4530.

A Guarantee Period for a Fixed Allocation begins:
|X|      when all or part of a net Purchase Payment is allocated to that particular Guarantee Period;
|X|      upon transfer of any of your Account Value to a Fixed Allocation for that particular Guarantee Period; or
|X|      when you "renew" a Fixed Allocation by electing a new Guarantee Period.

To the extent  permitted by law, we may  establish  different  interest  rates for Fixed  Allocations  offered to a class of Owners who
choose to participate in various optional  investment programs we make available.  This may include,  but is not limited to, Owners who
elect to use Fixed  Allocations  under a dollar  cost  averaging  program  (see "Do You Offer  Dollar Cost  Averaging?")  or a balanced
investment  program (see "Do you offer  programs  designed to guarantee a "Return of Premium" at a future  date?").  The interest  rate
credited to Fixed  Allocations  offered to this class of purchasers may be different than those offered to other  purchasers who choose
the same Guarantee Period but who do not participate in an optional investment program.  Any such program is at our sole discretion.

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American Skandia may offer Fixed Allocations with Guarantee  Periods of 3 months or 6 months  exclusively for use as a short-term Fixed
Allocation  ("Short-term Fixed  Allocations").  Short-term Fixed Allocations may only be established with your initial Purchase Payment
or additional  Purchase  Payments.  You may not transfer existing Account Value to a Short-term Fixed Allocation.  We reserve the right
to terminate offering these special purpose Fixed Allocations at any time.
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On the Maturity Date of the Short-term  Fixed  Allocation,  the Account Value will be transferred to the  Sub-account(s)  you choose at
the  inception of the  program.  If no  instructions  are  provided,  such Account  Value will be  transferred  to the AST Money Market
Sub-account.  Short-term  Fixed  Allocations  may not be renewed on the Maturity  Date.  If you  surrender  the Annuity or transfer any
Account Value from the Short-term  Fixed  Allocation to any other  investment  option before the end of the Guarantee  Period, a Market
Value Adjustment will apply.

HOW DO YOU DETERMINE RATES FOR FIXED ALLOCATIONS?
We do not have a specific  formula for  determining  the fixed  interest rates for Fixed  Allocations.  Generally the interest rates we
offer for Fixed  Allocations  will reflect the  investment  returns  available on the types of investments we make to support our fixed
rate  guarantees.  These  investment  types may include  cash,  debt  securities  guaranteed by the United  States  government  and its
agencies and  instrumentalities,  money market  instruments,  corporate debt obligations of different  durations,  private  placements,
asset-backed  obligations  and municipal  bonds.  In  determining  rates we also  consider  factors such as the length of the Guarantee
Period for the Fixed  Allocation,  regulatory  and tax  requirements,  liquidity  of the markets for the type of  investments  we make,
commissions,  administrative  and investment  expenses,  our insurance  risks in relation to the Fixed  Allocations,  general  economic
trends and  competition.  Some of these  considerations  are similar to those we consider in determining  the Insurance  Charge that we
deduct from Account Value allocated to the Sub-accounts.

We will credit  interest on a new Fixed  Allocation  in an existing  Annuity at a rate not less than the rate we are then  crediting to
Fixed Allocations for the same Guarantee Period selected by new Annuity purchasers in the same class.

The  interest  rate we  credit  for a  Fixed  Allocation  is  subject  to a  minimum.  Please  refer  to the  Statement  of  Additional
Information.  In certain states the interest rate may be subject to a minimum under state law or regulation.

HOW DOES THE MARKET VALUE ADJUSTMENT WORK?

If you transfer or withdraw  Account Value from a Fixed  Allocation more than 30 days before the end of its Guarantee  Period,  we will
adjust the value of your investment  based on a formula,  called a "Market Value  Adjustment" or "MVA".  The amount of any Market Value
Adjustment  can be either  positive  or  negative,  depending  on the  movement  of a  combination  of Strip  Yields  on Strips  and an
Option-adjusted  Spread  (each as defined  below)  between  the time that you  purchase  the Fixed  Allocation  and the time you make a
transfer  or  withdrawal.  The  Market  Value  Adjustment  formula  compares  the  combination  of  Strip  Yields  for  Strips  and the
Option-adjusted  Spreads  as of the  date the  Guarantee  Period  began  with  the  combination  of Strip  Yields  for  Strips  and the
Option-adjusted  Spreads as of the date the MVA is being  calculated.  In certain states the amount of any Market Value  Adjustment may
be limited  under state law or  regulation.  If your Annuity is governed by the laws of that state,  any Market Value  Adjustment  that
applies will be subject to our rules for complying with such law or regulation.

|X|      "Strips" are a form of security where  ownership of the interest  portion of United States  Treasury  securities are separated
     from ownership of the underlying principal amount or corpus.
|X|      "Strip Yields" are the yields payable on coupon Strips of United States Treasury securities.
|X|      "Option-adjusted  Spread" is the difference between the yields on corporate debt securities  (adjusted to disregard options on
     such  securities)  and  government  debt  securities  of  comparable  duration.  We currently  use the Merrill  Lynch 1 to 10 year
     Investment Grade Corporate Bond Index of Option-adjusted Spreads.


MVA Formula
The MVA formula is applied  separately to each Fixed  Allocation to determine the Account Value of the Fixed Allocation on a particular
date.  The formula is as follows:

                                                      [(1+I) / (1+J+0.0010)]N/365
                                                                where:

                  I is the Strip  Yield as of the start date of the  Guarantee  Period for coupon  Strips  maturing at
                  the end of the  applicable  Guarantee  Period  plus the  Option-adjusted  Spread.  If  there  are no
                  Strips  maturing  at that  time,  we will use the Strip  Yield for the  Strips  maturing  as soon as
                  possible after the Guarantee Period ends.

                  J is the Strip Yield as of the date the MVA formula is being applied for coupon  Strips  maturing at
                  the end of the  applicable  Guarantee  Period  plus the  Option-adjusted  Spread.  If  there  are no
                  Strips  maturing  at that  time,  we will use the Strip  Yield for the  Strips  maturing  as soon as
                  possible after the Guarantee Period ends.

                  N is the number of days remaining in the original Guarantee Period.

If you surrender your Annuity under the right to cancel provision, the MVA formula is [(1 + I)/(1 + J)]N/365.

MVA Examples
The following hypothetical examples show the effect of the MVA in determining Account Value.  Assume the following:
|X|      On December 31, 2000,  you allocate  $50,000 into a Fixed  Allocation  with a Guarantee  Period of 5 years (e.g.  the Maturity
         Date is December 31, 2005).
|X|      The Strip Yields for coupon Strips  beginning on December 31, 2000 and maturing on December 31, 2005 plus the  Option-adjusted
         Spread is 5.50% (I = 5.50%).
|X|      You make no  withdrawals  or transfers  until you decided to withdraw  the entire Fixed  Allocation  after  exactly  three (3)
         years, therefore 730 days remain before the Maturity Date (N = 730).

Example of Positive MVA
Assume  that at the  time  you  request  the  withdrawal,  the  Strip  Yields  for  Strips  maturing  on  December  31,  2005  plus the
Option-adjusted Spread is 4.00%  (J = 4.00%).  Based on these assumptions, the MVA would be calculated as follows:

                                  MVA Factor = [(1+I)/(1+J+0.0010)]N/365 = [1.055/1.041]2 = 1.027078
                                                      Interim Value = $57,881.25
                                   Account Value after MVA = Interim Value X MVA Factor = $59,448.56

Example of Negative MVA
Assume  that at the  time  you  request  the  withdrawal,  the  Strip  Yields  for  Strips  maturing  on  December  31,  2005  plus the
Option-adjusted Spread is 7.00% (J = 7.00%).  Based on these assumptions, the MVA would be calculated as follows:

                                  MVA Factor = [(1+I)/(1+J+0.0010)]N/365 = [1.055/1.071)]2 = 0.970345
                                                      Interim Value = $57,881.25
                                  Account Value after MVA = Interim Value X MVA Factor = $56,164.78.

WHAT HAPPENS WHEN MY GUARANTEE PERIOD MATURES?
The "Maturity  Date" for a Fixed  Allocation  is the last day of the  Guarantee  Period.  Before the Maturity  Date,  you may choose to
renew the Fixed  Allocation  for a new Guarantee  Period of the same or different  length or you may transfer all or part of that Fixed
Allocation's  Account  Value to another  Fixed  Allocation  or to one or more  Sub-accounts.  We will not charge a MVA if you choose to
renew a Fixed  Allocation  on its Maturity  Date or transfer the Account  Value to one or more  variable  investment  options.  We will
notify you before  the end of the  Guarantee  Period  about the fixed  interest  rates  that we are  currently  crediting  to all Fixed
Allocations that are being offered.  The rates being credited to Fixed Allocations may change before the Maturity Date.

If you do not specify how you want a Fixed  Allocation  to be allocated on its Maturity  Date,  we will then transfer the Account Value
of the  Fixed  Allocation  to the AST  Money  Market  Sub-account.  You can then  elect to  allocate  the  Account  Value to any of the
Sub-accounts or to a new Fixed Allocation.

ACCESS TO ACCOUNT VALUE

WHAT TYPES OF DISTRIBUTIONS ARE AVAILABLE TO ME?
During the  accumulation  period you can access your Account Value  through  Partial  Withdrawals,  Systematic  Withdrawals,  and where
required for tax  purposes,  Minimum  Distributions.  You can also  surrender  your Annuity at any time. We may deduct a portion of the
Account Value being  withdrawn or  surrendered  as a CDSC. If you  surrender  your Annuity,  in addition to any CDSC, we may deduct the
Annual  Maintenance  Fee,  any Tax Charge  that  applies and the charge for any  optional  benefits.  We may also apply a Market  Value
Adjustment  to any Fixed  Allocations.  Certain  amounts  may be  available  to you each  Annuity  Year that are not subject to a CDSC.
These are  called  "Free  Withdrawals."  In  addition,  under  certain  circumstances,  we may waive the CDSC for  surrenders  made for
qualified  medical reasons or for  withdrawals  made to satisfy Minimum  Distribution  requirements.  Unless you notify us differently,
withdrawals  are taken pro-rata based on the Account Value in the investment  options at the time we receive your  withdrawal  request.
Each of these types of distributions is described more fully below.

ARE THERE TAX IMPLICATIONS FOR DISTRIBUTIONS?
(For more information, see "Tax Considerations")

During the Accumulation Period
A distribution  during the  accumulation  period is deemed to come first from any "gain" in your Annuity and second as a return of your
"tax  basis",  if any.  Distributions  from your  Annuity  are  generally  subject to  ordinary  income  taxation  on the amount of any
investment  gain unless the  distribution  qualifies as a non-taxable  exchange or transfer.  If you take a  distribution  prior to the
taxpayer's  age 59 1/2, you may be subject to a 10% penalty in addition to ordinary  income  taxes on any gain.  You may wish to consult a
professional tax advisor for advice before requesting a distribution.

During the Annuitization Period
During the  annuitization  period,  a portion of each annuity payment is taxed as ordinary income at the tax rate you are subject to at
the time of the payment.  The Code and  regulations  have  "exclusionary  rules" that we use to determine  what portion of each annuity
payment  should  be  treated  as a  return  of any tax  basis  you have in the  Annuity.  Once the tax  basis in the  Annuity  has been
distributed,  the  remaining  annuity  payments  are  taxable as  ordinary  income.  The tax basis in the  Annuity  may be based on the
tax-basis from a prior contract in the case of a 1035 exchange or other qualifying transfer.

CAN I WITHDRAW A PORTION OF MY ANNUITY?
Yes, you can make a withdrawal during the accumulation period.

|X|      To meet liquidity  needs,  you can withdraw a limited amount from your Annuity during each of Annuity Years 1-4 without a CDSC
         being  applied.  We call this the "Free  Withdrawal"  amount.  The Free  Withdrawal  amount is not  available if you choose to
         surrender  your  Annuity.  Amounts  withdrawn  as a Free  Withdrawal  do not  reduce  the amount of CDSC that may apply upon a
         subsequent withdrawal or surrender of the Annuity.  The minimum Free Withdrawal you may request is $100.

|X|      You can also make  withdrawals  in excess of the Free  Withdrawal  amount.  We call this a  "Partial  Withdrawal."  The amount
         that you may withdraw will depend on the Annuity's  Surrender  Value. The Surrender Value is equal to your Account Value minus
         any CDSC, the Annual  Maintenance Fee, the Tax Charge,  any charges for optional benefits and any Market Value Adjustment that
         may apply to any Fixed  Allocations.  After any Partial  Withdrawal,  your  Annuity  must have a  Surrender  Value of at least
         $1,000,  or we may treat the Partial  Withdrawal  request as a request to fully  surrender your Annuity.  The minimum  Partial
         Withdrawal you may request is $100.

When we determine if a CDSC applies to Partial  Withdrawals and Systematic  Withdrawals,  we will first determine what, if any, amounts
qualify as a Free  Withdrawal.  Those amounts are not subject to the CDSC.  Partial  Withdrawals  or Systematic  Withdrawals of amounts
greater than the maximum Free Withdrawal amount will be subject to a CDSC.

You may request a withdrawal  for an exact dollar  amount after  deduction  of any CDSC that  applies  (called a "net  withdrawal")  or
request a gross  withdrawal  from which we will deduct any CDSC that  applies,  resulting  in less money being  payable to you than the
amount you  requested.  If you  request a net  withdrawal,  the amount  deducted  from your  Account  Value to pay the CDSC may also be
subject to a CDSC.

Partial Withdrawals may also be available following annuitization but only if you choose certain annuity payment options.

To request the forms necessary to make a withdrawal from your Annuity,  contact our Customer  Service Team at  1-800-680-8920  or visit
our Internet Website at www.americanskandia.prudential.com.

HOW MUCH CAN I WITHDRAW AS A FREE WITHDRAWAL?

Annuity Year 1-4
The maximum Free  Withdrawal  amount  during each of Annuity  Year 1 through  Annuity  Year 4 (when a CDSC would  otherwise  apply to a
partial  withdrawal  or surrender  of your initial  Purchase  Payments)  is 10% of all Purchase  Payments.  We may apply a Market Value
Adjustment  to any Fixed  Allocations.  The 10% Free  Withdrawal  amount is not  cumulative.  Withdrawals  of amounts  greater than the
maximum Free  Withdrawal  amount are treated as a withdrawal  of Purchase  Payments and will be assessed a CDSC during  Annuity Years 1
through 4. If,  during  Annuity  Years 1 through  4, all  Purchase  Payments  withdrawn  are  subject  to a CDSC,  then any  subsequent
withdrawals  will be withdrawn from any gain in the Annuity.  If you do not make a Free Withdrawal  during an Annuity Year, you are not
allowed to carry over the Free Withdrawal amount to the next Annuity Year.

Annuity Year 5+
After Annuity Year 4, you can surrender your Annuity or make a partial  withdrawal  without a CDSC being deducted from the amount being
withdrawn.

NOTE:  Amounts  that you have  withdrawn  as a Free  Withdrawal  will not reduce  the amount of any CDSC that we deduct if,  during the
first four (4) Annuity Years, you make a partial withdrawal or choose to surrender the Annuity.

Examples
1.       Assume  you make an  initial  Purchase  Payment  of  $10,000  and make no  additional  Purchase  Payments.  The  maximum  Free
     Withdrawal amount during each of the first four Annuity Years would be 10% of $10,000, or $1,000.

2.       Assume you make an initial  Purchase  Payment of $10,000 and make an additional  Purchase Payment of $5,000 in Annuity Year 2.
     The maximum  Free  Withdrawal  amount  during  Annuity  Year 3 and 4 would be 10% of $15,000,  or $1,500.  From Annuity Year 5 and
     thereafter,  you can  surrender  your Annuity or make a partial  withdrawal  without a CDSC being  deducted  from the amount being
     withdrawn.

3.       Assume you make an initial  Purchase  Payment of $10,000 and take a Free  Withdrawal  of $500 in Annuity  Year 2 and $1,000 in
     Annuity Year 3. If you surrender your Annuity in Annuity Year 4, the CDSC will be assessed  against the initial  Purchase  Payment
     amount  ($10,000),  not the amount of Purchase  Payments  reduced by the amounts  that were  withdrawn  under the Free  Withdrawal
     provision.

IS THERE A CHARGE FOR A PARTIAL WITHDRAWAL?
A CDSC may be assessed  against a Partial  Withdrawal  during the first four (4) Annuity  Years.  Whether a CDSC applies and the amount
to be charged depends on whether the Partial  Withdrawal  exceeds any Free Withdrawal  amount and, if so, the number of years that have
elapsed since the Issue Date of the Annuity.

1.       If you request a Partial  Withdrawal,  we determine if the amount you  requested is available as a Free  Withdrawal  (in which
     case it would not be subject to a CDSC);
2.       If the amount  requested  exceeds the  available  Free  Withdrawal  amount,  we  determine if a CDSC will apply to the Partial
     Withdrawal  based on the number of years that have  elapsed  since the Annuity was issued.  The  maximum  Free  Withdrawal  amount
     during each of Annuity Years 1 through 4 is 10% of all Purchase  Payments.  Withdrawals  of amounts  greater than the maximum Free
     Withdrawal  amount are treated as a  withdrawal  of Purchase  Payments and will be assessed a CDSC.  If,  during  Annuity  Years 1
     through 4, all Purchase Payments are withdrawn subject to a CDSC, then any subsequent  withdrawals will be withdrawn from any gain
     in the Annuity.

3.       If the amount  requested  exceeds the amounts  available under Item #2 above, we withdraw the remaining  amount from any other
     Account Value.
|X|      If the  Annuity has been in effect for less than four  complete  years,  a CDSC will be charged on the amount of the  Purchase
         Payment being withdrawn, according to the CDSC table.
|X|      If the Annuity has been in effect for more than four complete years, no CDSC will be charged on the amount being withdrawn.

For  purposes of  calculating  the CDSC on a partial  withdrawal,  the  Purchase  Payments  being  withdrawn  may be greater  than your
remaining  Account  Value or the amount of your  withdrawal  request.  This is most likely to occur if you have made prior  withdrawals
under the Free Withdrawal provision or if your Account Value has declined in value due to negative market performance.

CAN I MAKE PERIODIC WITHDRAWALS FROM THE ANNUITY DURING THE ACCUMULATION PERIOD?
Yes. We call these "Systematic  Withdrawals."  You can receive  Systematic  Withdrawals of earnings only,  principal plus earnings or a
flat  dollar  amount.  Systematic  Withdrawals  during the first four (4)  Annuity  Years may be subject to a CDSC.  We will  determine
whether a CDSC applies and the amount in the same way as we would for a Partial Withdrawal.

Systematic  Withdrawals can be made from Account Value allocated to the variable  investment options or Fixed  Allocations.  Generally,
Systematic  Withdrawals from Fixed Allocations are limited to earnings accrued after the program of Systematic  Withdrawals  begins, or
payments of fixed dollar  amounts that do not exceed such  earnings.  Systematic  Withdrawals  are  available on a monthly,  quarterly,
semi-annual  or annual  basis.  The  Surrender  Value of your  Annuity  must be at least  $20,000  before we will  allow you to begin a
program of Systematic Withdrawals.

The minimum  amount for each  Systematic  Withdrawal  is $100.  If any  scheduled  Systematic  Withdrawal is for less than $100, we may
postpone the withdrawal and add the expected amount to the amount that is to be withdrawn on the next scheduled Systematic Withdrawal.

DO YOU OFFER A PROGRAM FOR WITHDRAWALS UNDER SECTION 72(t) OF THE INTERNAL REVENUE CODE?
Yes. If your Annuity is used as a funding vehicle for certain  retirement  plans that receive special tax treatment under Sections 401,
403(b) or 408 of the Code,  Section  72(t) of the Code may provide an exception to the 10% penalty tax on  distributions  made prior to
age 59 1/2if you elect to receive  distributions as a series of "substantially  equal periodic  payments".  Distributions  received under
this  provision in any Annuity Year that exceed the maximum  amount  available as a free  withdrawal  will be subject to a CDSC. We may
apply a Market Value  Adjustment to any Fixed  Allocations.  To request a program that complies with Section 72(t), you must provide us
with certain  required  information in writing on a form  acceptable to us. We may require  advance notice to allow us to calculate the
amount of 72(t)  withdrawals.  The  Surrender  Value of your  Annuity  must be at least  $20,000  before  we will  allow you to begin a
program for withdrawals under Section 72(t).  The minimum amount for any such withdrawal is $100.

You may also annuitize  your contract and begin  receiving  payments for the remainder of your life (or life  expectancy) as a means of
receiving income payments before age 59 1/2that are not subject to the 10% penalty.

WHAT ARE MINIMUM DISTRIBUTIONS AND WHEN WOULD I NEED TO MAKE THEM?
(See "Tax Considerations" for a further discussion of Minimum Distributions.)

Minimum  Distributions  are a type of Systematic  Withdrawal we allow to meet distribution  requirements  under Sections 401, 403(b) or
408 of the Code.  Under the Code,  you may be required to begin  receiving  periodic  amounts from your Annuity.  In such case, we will
allow you to make  Systematic  Withdrawals  in amounts that satisfy the minimum  distribution  rules under the Code. We do not assess a
CDSC on Minimum  Distributions  from your Annuity if you are required by law to take such  Minimum  Distributions  from your Annuity at
the time it is taken.  However,  a CDSC may be  assessed  on that  portion of a  Systematic  Withdrawal  that is taken to  satisfy  the
minimum  distribution  requirements  in relation to other  savings or  investment  plans under  other  qualified  retirement  plans not
maintained with American Skandia.

The amount of the required Minimum  Distribution for your particular  situation may depend on other annuities,  savings or investments.
We will only  calculate  the amount of your required  Minimum  Distribution  based on the value of your  Annuity.  We require three (3)
days advance  written notice to calculate and process the amount of your  payments.  You may elect to have Minimum  Distributions  paid
out monthly,  quarterly,  semi-annually or annually.  The $100 minimum that applies to Systematic Withdrawals does not apply to Minimum
Distributions.

You may also annuitize  your contract and begin  receiving  payments for the remainder of your life (or life  expectancy) as a means of
receiving income payments and satisfying the Minimum Distribution requirements under the Code.

CAN I SURRENDER MY ANNUITY FOR ITS VALUE?
Yes.  During the  accumulation  period you can  surrender  your Annuity at any time.  Upon  surrender,  you will receive the  Surrender
Value.  Upon surrender of your Annuity, you will no longer have any rights under the Annuity.

For purposes of calculating the CDSC on surrender,  the Purchase  Payments being  withdrawn may be greater than your remaining  Account
Value or the  amount  of your  withdrawal  request.  This is most  likely to occur if you have made  prior  withdrawals  under the Free
Withdrawal  provision or if your Account Value has declined in value due to negative  market  performance.  We may apply a Market Value
Adjustment to any Fixed Allocations.

Under certain annuity payment options, you may be allowed to surrender your Annuity for its then current value.

To request the forms necessary to surrender your Annuity,  contact our Customer  Service Team at  1-800-680-8920  or visit our Internet
Website at www.americanskandia.prudential.com.

WHAT IS A MEDICALLY-RELATED SURRENDER AND HOW DO I QUALIFY?
Where  permitted by law,  you may request to surrender  your  Annuity  prior to the Annuity Date without  application  of any CDSC upon
occurrence of a  medically-related  "Contingency  Event". We may apply a Market Value Adjustment to any Fixed  Allocations.  The amount
payable will be your Account Value.

This waiver of any applicable CDSC is subject to our rules, including but not limited to the following:
|X|      the Annuitant must be alive as of the date we pay the proceeds of such surrender request;
|X|      if the Owner is one or more natural persons, all such Owners must also be alive at such time;
|X|      we must receive  satisfactory  proof of the Annuitant's  confinement in a Medical Care Facility or Fatal Illness in writing on
     a form satisfactory to us; and
|X|      this benefit is not available if the total Purchase  Payments  received  exceed  $500,000 for all annuities  issued by us with
     this benefit where the same person is named as Annuitant.

The  Annuitant  must have been named or any  change of  Annuitant  must have been  accepted  by us,  prior to the  "Contingency  Event"
described above in order to qualify for a medically-related surrender.

The  definitions  of "Medical Care  Facility" and "Fatal  Illness," as well as additional  terms and  conditions,  are provided in your
Annuity.  Specific details and definitions in relation to this benefit may differ in certain jurisdictions.

WHAT TYPES OF ANNUITY OPTIONS ARE AVAILABLE?
We currently make annuity  options  available that provide fixed annuity  payments,  variable  payments or adjustable  payments.  Fixed
options  provide the same  amount with each  payment.  Variable  options  generally  provide a payment  which may  increase or decrease
depending on the investment  performance of the  Sub-accounts.  However,  currently,  we also make a variable payment option that has a
guarantee  feature.  Adjustable  options provide a fixed payment that is periodically  adjusted based on current  interest rates. We do
not guarantee to make any annuity payment options  available in the future.  For additional  information on annuity payment options you
may request a Statement of Additional Information.

When you  purchase an Annuity,  or at a later date,  you may choose an Annuity  Date,  an annuity  option and the  frequency of annuity
payments.  You may change  your  choices  before the  Annuity  Date under the terms of your  contract.  A maximum  Annuity  Date may be
required  by law.  The  Annuity  Date may depend on the  annuity  option you  choose.  Certain  annuity  options  may not be  available
depending on the age of the Annuitant.

Certain of these annuity  options may be available to  Beneficiaries  who choose to receive the Death  Benefit  proceeds as a series of
payments instead of a lump sum payment.

Option 1
Payments for Life:  Under this option,  income is payable  periodically  until the death of the "key life".  The "key life" (as used in
this section) is the person or persons upon whose life annuity  payments are based. No additional  annuity  payments are made after the
death of the key life.  Since no minimum number of payments is guaranteed,  this option offers the largest amount of periodic  payments
of the life  contingent  annuity  options.  It is possible  that only one  payment  will be payable if the death of the key life occurs
before the date the second  payment was due,  and no other  payments  nor death  benefits  would be payable.  This Option is  currently
available on a fixed or variable basis.  Under this option, you cannot make a partial or full surrender of the annuity.

Option 2
Payments  Based on Joint Lives:  Under this option,  income is payable  periodically  during the joint  lifetime of two key lives,  and
thereafter  during the remaining  lifetime of the survivor,  ceasing with the last payment prior to the  survivor's  death.  No minimum
number of payments is  guaranteed  under this option.  It is possible that only one payment will be payable if the death of all the key
lives occurs  before the date the second  payment was due, and no other  payments or death  benefits  would be payable.  This Option is
currently available on a fixed or variable basis.  Under this option, you cannot make a partial or full surrender of the annuity.

Option 3
Payments for Life with a Certain  Period:  Under this option,  income is payable until the death of the key life.  However,  if the key
life dies before the end of the period selected (5, 10 or 15 years),  the remaining  payments are paid to the Beneficiary until the end
of such  period.  This Option is  currently  available  on a fixed or variable  basis.  If you elect to receive  payments on a variable
basis under this  option,  you can request  partial or full  surrender  of the annuity and receive its then current cash value (if any)
subject to our rules.

Option 4
Fixed Payments for a Certain Period:  Under this option,  income is payable  periodically for a specified number of years. If the payee
dies  before the end of the  specified  number of years,  the  remaining  payments  are paid to the  Beneficiary  until the end of such
period.  Note that under this option,  payments are not based on any  assumptions of life  expectancy.  Therefore,  that portion of the
Insurance  Charge  assessed to cover the risk that key lives outlive our  expectations  provides no benefit to an Owner  selecting this
option.  Under this option, you cannot make a partial or full surrender of the annuity.

Option 5
Variable Payments for Life with a Cash Value:  Under this option,  benefits are payable  periodically  until the death of the key life.
Benefits may increase or decrease  depending  on the  investment  performance  of the  Sub-accounts.  This option has a cash value that
also  varies  with the  investment  performance  of the  Sub-account.  The cash value  provides a "cushion"  from  volatile  investment
performance so that negative  investment  performance  does not  automatically  result in a decrease in the annuity payment each month,
and positive  investment  performance  does not  automatically  result in an increase in the annuity  payment  each month.  The cushion
generally  "stabilizes"  monthly annuity payments.  Any cash value remaining on the death of the key life is paid to the Beneficiary in
a lump sum or as periodic  payments.  Under this option,  you can request partial or full surrender of the annuity and receive its then
current cash value (if any) subject to our rules.

Option 6
Variable  Payments for Life with a Cash Value and Guarantee:  Under this option,  benefits are payable as described in Option 5; except
that,  while the key life is alive,  the annuity  payment will not be less than a guaranteed  amount,  which  generally is equal to the
first annuity  payment.  We charge an additional  amount for this guarantee.  Under this option,  any cash value remaining on the death
of the key life is paid to the Beneficiary in a lump sum or as periodic  payments.  Under this option,  you can request partial or full
surrender of the annuity and receive its then current cash value (if any) subject to our rules.

We may make additional annuity payment options available in the future.

HOW AND WHEN DO I CHOOSE THE ANNUITY PAYMENT OPTION?
Unless  prohibited  by law, we require that you elect either a life annuity or an annuity with a certain  period of at least 5 years if
any CDSC would apply were you to  surrender  your  Annuity on the Annuity  Date.  Therefore,  choosing an Annuity  Date within four (4)
years of the Issue Date of the Annuity may limit the available  annuity  payment  options.  Certain  annuity payment options may not be
available if your Annuity Date occurs during the period that a CDSC would apply.

If you have not provided us with your Annuity Date or annuity payment option in writing, then:
|X|      the Annuity Date will be the first day of the calendar  month  following  the later of the  Annuitant's  85th  birthday or the
         fifth anniversary of our receipt of your request to purchase an Annuity; and
|X|      the annuity  payments,  where  allowed by law,  will be  calculated on a fixed basis under Option 3, Payments for Life with 10
         years certain.

HOW ARE ANNUITY PAYMENTS CALCULATED?

Fixed Annuity Payments (Options 1-4)
If you choose to receive fixed annuity payments,  you will receive equal  fixed-dollar  payments  throughout the period you select. The
amount of the fixed payment will vary depending on the annuity payment option and payment  frequency you select.  Generally,  the first
annuity  payment is  determined  by  multiplying  the  Account  Value,  minus any state  premium  taxes  that may apply,  by the factor
determined  from our table of annuity  rates.  The table of annuity rates differs based on the type of annuity chosen and the frequency
of payment  selected.  Our rates will not be less than our guaranteed  minimum rates.  These guaranteed  minimum rates are derived from
the a2000  Individual  Annuity  Mortality  Table with an assumed  interest rate of 3% per annum.  Where  required by law or regulation,
such  annuity  table will have  rates that do not differ  according  to the gender of the key life.  Otherwise,  the rates will  differ
according to the gender of the key life.

Variable Annuity Payments
We offer three  different  types of variable  annuity  payment  options.  The first annuity  payment will be calculated  based upon the
assumed  investment  return  ("AIR").  You  select the AIR  before we start to make  annuity  payments.  You will not  receive  annuity
payments  until you choose an AIR.  The  remaining  annuity  payments  will  fluctuate  based on the  performance  of the  Sub-accounts
relative to the AIR,  as well as,  other  factors  described  below.  The greater the AIR,  the greater the first  annuity  payment.  A
higher AIR may result in smaller  potential  growth in the annuity  payments.  A lower AIR results in a lower initial annuity  payment.
Within payment options 1-3, if the Sub-accounts  you choose perform exactly the same as the AIR, then subsequent  annuity payments will
be the same as the first  annuity  payment.  If the  Sub-accounts  you choose  perform  better than the AIR,  then  subsequent  annuity
payments will be higher than the first annuity  payment.  If the  Sub-accounts  you choose perform worse than the AIR, then  subsequent
annuity  payments will be lower than the first.  Within payment  options 5 and 6, the cash value for the Annuitant  (while alive) and a
variable  period of time during which annuity  payments will be made whether or not the Annuitant is still alive are adjusted  based on
the  performance of the  Sub-accounts  relative to the AIR;  however,  subsequent  annuity  payments do not always increase or decrease
based on the performance of the Sub-accounts relative to the AIR.

|X|      Variable Payments (Options 1-3)
         We calculate  each annuity  payment  amount by  multiplying  the number of units  scheduled to be redeemed under a schedule of
         units for each  Sub-account by the Unit Value of each  Sub-account  on the annuity  payment date. We determine the schedule of
         units  based on your  Account  Value  (minus any premium tax that  applies) at the time you elect to begin  receiving  annuity
         payments.  The schedule of units will vary based on the annuity  payment  option  selected,  the length of any certain  period
         (if  applicable),  the  Annuitant's  age and gender (if annuity  payments are due for the life of the  Annuitant) and the Unit
         Value of the Sub-accounts  you initially  selected on the Issue Date. The calculation is performed for each  Sub-account,  and
         the sum of the Sub-account  calculations equals the amount of your annuity payment.  Other than to fund annuity payments,  the
         number  of units  allocated  to each  Sub-account  will not  change  unless  you  transfer  among the  Sub-accounts  or make a
         withdrawal (if allowed).  You can select one of three AIRs for these options: 3%, 5% or 7%.

|X|      Stabilized Variable Payments (Option 5)
         This option  provides  guaranteed  payments for life, a cash value for the Annuitant  (while  alive) and a variable  period of
         time during which  annuity  payments  will be made  whether or not the  Annuitant  is still  alive.  We calculate  the initial
         annuity  payment  amount by  multiplying  the number of units  scheduled to be redeemed  under a schedule of units by the Unit
         Values  determined on the  annuitization  date. The schedule of units is established  for each  Sub-account  you choose on the
         annuitization  date based on the applicable  benchmark  rate,  meaning the AIR, and the annuity  factors.  The annuity factors
         reflect our  assumptions  regarding  the costs we expect to bear in  guaranteeing  payments for the lives of the Annuitant and
         will depend on the benchmark  rate,  the  annuitant's  attained age and gender (where  permitted).  Unlike  variable  payments
         (described  above) where each payment can vary based on Sub-account  performance,  this payment option  cushions the immediate
         impact of Sub-account  performance  by adjusting the length of the time during which annuity  payments will be made whether or
         not the Annuitant is alive while generally  maintaining a level annuity payment amount.  Sub-account  performance that exceeds
         a benchmark rate will generally  extend this time period,  while  Sub-account  performance  that is less than a benchmark rate
         will generally  shorten the period.  If the period reaches zero and the Annuitant is still alive,  Annuity Payments  continue,
         however,  the annuity  payment  amount will vary  depending  on  Sub-account  performance,  similar to  conventional  variable
         payments.  The AIR for this option is 4%.

|X|      Stabilized Variable Payments with a Guaranteed Minimum (Option 6)
         This option provides  guaranteed  payments for life in the same manner as Stabilized  Variable Payments  (described above). In
         addition to the  stabilization  feature,  this option also guarantees that variable annuity payments will not be less than the
         initial annuity payment amount regardless of Sub-account performance.  The AIR for this option is 3%.

The variable  annuity  payment  options are described in greater detail in a separate  prospectus  which will be provided to you at the
time you elect one of the variable annuity payment options.

Adjustable Annuity Payments
We may make an adjustable  annuity payment option  available.  Adjustable  annuity  payments are calculated  similarly to fixed annuity
payments except that on every fifth (5th) anniversary of receiving  annuity payments,  the annuity payment amount is adjusted upward or
downward  depending on the rate we are currently  crediting to annuity payments.  The adjustment in the annuity payment amount does not
affect the duration of remaining annuity payments, only the amount of each payment.

LIVING BENEFIT PROGRAMS

DO YOU OFFER PROGRAMS DESIGNED TO PROVIDE INVESTMENT PROTECTION FOR OWNERS WHILE THEY ARE ALIVE?
Yes. American Skandia offers three different optional benefits,  for an additional charge,  that can provide investment  protection for
Owners while they are alive.  Each optional  benefit  offers a distinct type of guarantee,  regardless of the  performance  of variable
investment  options,  that may be appropriate for you depending on the manner in which you intend to make use of your annuity while you
are alive.  Depending on which optional  benefit you choose,  you can have  substantial  flexibility  to invest in variable  investment
options while:
|X|      protecting a principal amount from decreases in value as of specified future dates;
|X|      taking withdrawals with a guarantee that you will be able to withdraw not less than a principal amount over time; or
|X|      guaranteeing  a minimum  amount of growth  will be applied to your  principal,  if it is to be used as the basis for  lifetime
         income payments beginning after a waiting period.

Below is a brief summary of the three "living  benefits" that American  Skandia offers.  Please refer to the benefit  description for a
complete  description  of the terms,  conditions  and  limitations of each optional  benefit.  You should consult with your  investment
professional to determine if any of these optional  benefits may be appropriate for you based on your financial  needs.  There are many
factors to  consider,  but we note that among them you may want to evaluate  the tax  implications  of these  different  approaches  to
meeting your needs,  both between these benefits and in comparison to other potential  solutions to your needs (e.g.  comparing the tax
implications of the withdrawal benefit and annuity payments).

I.       The Guaranteed  Return Option PlusSM (GRO PlusSM)  guarantees  that, after a seven-year  period following  commencement of the
     program  ("maturity  date") and on each  anniversary of the maturity date  thereafter,  the Owner's Account Value will not be less
     than the Account  Value on the  effective  date of the  program.  The program  also offers the Owner the option to elect a second,
     enhanced  guarantee  amount at a higher  Account  Value subject to a separate  maturity  period (and its  anniversaries).  The GRO
     PlusSM program may be appropriate if you wish to protect a principal  amount  (called the  "Protected  Principal  Value")  against
     market  downturns as of a specific date in the future,  but also wish to exercise  substantial  control of the  allocation of your
     Account Value amongst the variable investment options to participate in market increases.  Under the GRO PlusSM program,  you give
     us the right to allocate amounts to Fixed Allocations as needed to support the guarantees provided.

II.      The Guaranteed  Minimum  Withdrawal  Benefit (GMWB)  guarantees the Owner's ability to make cumulative  withdrawals  over time
     equal to an initial principal value (called the "Protected  Withdrawal Value"),  regardless of decreases in your Account Value due
     to market losses.  The GMWB program may be appropriate  if you intend to make periodic  withdrawals  from your Annuity and wish to
     ensure that market performance will not affect your ability to protect your principal.  Taking income as withdrawals,  rather than
     annuity payments,  may be less tax efficient for non-qualified  uses of the Annuity,  but provides greater control over the timing
     and amount of withdrawals  during the accumulation  period, as well as continuing the Annuity's other benefits,  such as the death
     benefit.

III.     The Guaranteed  Minimum Income Benefit (GMIB) guarantees the Owner's ability,  after a minimum  seven-year  waiting period, to
     begin  receiving  income  from the  Annuity in the form of annuity  payments  based on a  guaranteed  minimum  value  (called  the
     "Protected Income Value") that increases after the waiting period begins,  regardless of the impact of market  performance on your
     Account  Value.  The GMIB program may be  appropriate  if you  anticipate  using your Annuity as a future source of periodic fixed
     income  payments  for the  remainder  of your life and wish to ensure  that the basis  upon  which your  income  payments  will be
     calculated will achieve at least a minimum amount of growth despite fluctuations in market performance.

The GRO PlusSM,  GMWB or GMIB programs may only be elected  individually,  and cannot be elected in combination with each other. Any of
the living  benefits can be elected with any of the  optional  death  benefits we currently  make  available.  We deduct an  additional
charge if you elect any of these  optional  benefits to compensate  American  Skandia for the  additional  insurance  risk we assume in
providing the applicable guarantee under each optional benefit.

GUARANTEED RETURN OPTION PlusSM (GRO PlusSM)

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The Guaranteed Return Option Plus described below is being offered in those jurisdictions  where we have received regulatory  approval,
and will be offered  subsequently in other  jurisdictions when we receive  regulatory  approval in those  jurisdictions.  Certain terms
and  conditions  may differ  between  jurisdictions  once  approved.  The program can be elected by new purchasers on the Issue Date of
their  Annuity,  and can be elected by existing  Annuity  Owners on either the  anniversary  of the Issue Date of their Annuity or on a
date other than that  anniversary,  as described  below under  "Election of the  Program".  The  Guaranteed  Return  Option Plus is not
available if you elect the  Guaranteed  Return Option  program,  the  Guaranteed  Minimum  Withdrawal  Benefit rider or the  Guaranteed
Minimum Income Benefit rider.
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We offer a program  that,  after a seven-year  period  following  commencement  of the program (we refer to the end of that  seven-year
period as the "maturity  date") and on each  anniversary  of the maturity date  thereafter,  guarantees  your Account Value will not be
less than your Account Value on the effective date of your program (called the "Protected  Principal  Value").  The program also offers
you the  opportunity  to elect a second,  enhanced  guaranteed  amount at a later  date if your  Account  Value  has  increased,  while
preserving  the  guaranteed  amount  established  on the effective  date of your program.  The enhanced  guaranteed  amount (called the
"Enhanced  Protected Principal Value") guarantees that, after a separate seven-year period following election of the enhanced guarantee
and on each  anniversary  thereafter,  your  Account  Value  will not be less than your  Account  Value on the  effective  date of your
election of the enhanced guarantee.

The program monitors your Account Value daily and, if necessary,  systematically  transfers amounts between variable investment options
you choose and Fixed  Allocations  used to support the Protected  Principal  Value(s).  The program may be  appropriate  if you wish to
protect a principal  amount  against  market  downturns  as of a specific  date in the future,  but also wish to invest in the variable
investment  options to participate in market  increases.  There is an additional  charge if you elect the Guaranteed Return Option Plus
program.

The guarantees  provided by the program exist only on the applicable  maturity  date(s) and on each anniversary of the maturity date(s)
thereafter.  However,  due to the  ongoing  monitoring  of your  Account  Value and the  transfer  of Account  Value  between  variable
investment  options and Fixed  Allocations to support our future  guarantees,  the program may provide some protection from significant
market losses if you choose to surrender the Annuity or begin receiving annuity payments prior to a maturity date.

KEY FEATURE - Protected Principal Value/Enhanced Protected Principal Value
The Guaranteed Return Option Plus offers a base guarantee as well as the option of electing an enhanced guarantee at a later date.
|X|      Base Guarantee:  Under the base guarantee,  American  Skandia  guarantees that on the maturity date and on each anniversary of
     the maturity date thereafter, your Account Value will be no less than the Protected Principal Value.
     On the maturity date and on each  anniversary  after the maturity  date,  if your Account  Value is below the Protected  Principal
     Value,  American Skandia will apply additional  amounts to your Annuity from its general account to increase your Account Value to
     be equal to the Protected Principal Value.

|X|      Enhanced  Guarantee:  On any  anniversary  following  commencement  of the program,  you can establish an enhanced  guaranteed
     amount based on your current  Account Value.  Under the enhanced  guarantee,  American  Skandia  guarantees that at the end of the
     seven year period  following  the  election of the enhanced  guarantee  (also  referred to as its  "maturity  date"),  and on each
     anniversary of the maturity date thereafter,  your Account Value will be no less than the Enhanced Protected  Principal Value. You
     can elect an enhanced  guarantee  more than once;  however,  a subsequent  election  supersedes  the prior election of an enhanced
     guarantee.  Election of an enhanced  guarantee does not impact the base  guarantee.  In addition,  you may elect an "auto step-up"
     feature that will automatically  increase your base guarantee (or enhanced  guarantee,  if previously elected) on each anniversary
     of the program (and create a new,  seven year  maturity  period for the new enhanced  guarantee)  if the Account  Value as of that
     anniversary exceeds the existing base guarantee (or enhanced  guarantee,  if previously elected) by 7% or more. You may also elect
     to terminate an enhanced guarantee.  If you elect to terminate the enhanced guarantee, the base guarantee will remain in effect.
     If you have  elected the enhanced  guarantee,  on the  guarantee's  maturity  date and on each  anniversary  of the maturity  date
     thereafter,  if your Account Value is below the Enhanced Protected Principal Value, American Skandia will apply additional amounts
     to your Annuity from its general account to increase your Account Value to be equal to the Enhanced Protected Principal Value.

Any amounts added to your Annuity will be applied,  if necessary,  to any Fixed Allocations needed to support the applicable  guarantee
amount as of the maturity  date or any  anniversary  of the maturity  date.  Any remaining  amounts will be allocated  pro-rata to your
Account  Value  based on your  current  Sub-account  allocations.  We will notify you of any amounts  added to your  Annuity  under the
program.  The Protected  Principal Value is referred to as the "Base Guarantee" and the Enhanced Protected  Principal Value is referred
to as the "Step-up Guarantee" in the rider we issue for this benefit.

Withdrawals under your Annuity
Withdrawals  from your  Annuity,  while the  program is in effect,  will  reduce the base  guarantee  under the  program as well as any
enhanced  guarantee.  Cumulative annual  withdrawals up to 5% of the Protected  Principal Value as of the effective date of the program
(adjusted  for any  subsequent  Purchase  Payments  and any Credits  applied to such  Purchase  Payments)  will  reduce the  applicable
guaranteed amount by the actual amount of the withdrawal  (referred to as the  "dollar-for-dollar  limit").  If the amount withdrawn is
greater  than the  dollar-for-dollar  limit,  the portion of the  withdrawal  equal to the  dollar-for-dollar  limit will be treated as
described  above,  and the portion of the  withdrawal in excess of the  dollar-for-dollar  limit will reduce the base guarantee and the
enhanced  guarantee  proportionally,  according  to the formula as  described  in the rider for this  benefit (see the examples of this
calculation  below).  Withdrawals will be taken pro-rata from the variable  investment options and any Fixed  Allocations.  Withdrawals
will be subject to all other  provisions of the Annuity,  including any  Contingent  Deferred  Sales Charge or Market Value  Adjustment
that would apply.

Charges for other  optional  benefits under the Annuity that are deducted as an annual charge in arrears will not reduce the applicable
guaranteed amount under the Guaranteed Return Option Plus program.

The following examples of dollar-for-dollar  and proportional  reductions assume that: 1.) the Issue Date and the effective date of the
GRO PlusSM program are October 13, 2003; 2.) an initial  Purchase  Payment of $250,000;  3.) a base guarantee  amount of $250,000;  and
4.) a dollar-for-dollar limit of $12,500 (5% of $250,000):

Example 1. Dollar-for-dollar reduction

A $10,000  withdrawal is taken on November 29, 2003 (in the first Annuity Year).  No prior  withdrawals  have been taken. As the amount
withdrawn is less than the Dollar-for-dollar Limit:
o        The base guarantee amount is reduced by the amount withdrawn (i.e., by $10,000, from $250,000 to $240,000).
o        The remaining  dollar-for-dollar  limit  ("Remaining  Limit") for the balance of the first Annuity Year is also reduced by the
         amount withdrawn (from $12,500 to $2,500).

Example 2. Dollar-for-dollar and proportional reductions

A second  $10,000  withdrawal  is taken on December 18, 2003 (still  within the first  Annuity  Year).  The Account  Value  immediately
before the withdrawal is $180,000.  As the amount withdrawn exceeds the Remaining Limit of $2,500 from Example 1:
o        the base guarantee amount is first reduced by the Remaining Limit (from $240,000 to $237,500);
o        The result is then further reduced by the ratio of A to B, where:
o        A is the amount withdrawn less the Remaining Limit ($10,000 - $2,500, or $7,500).
o        B is the Account Value less the Remaining Limit ($180,000 - $2,500, or $177,500).
     The resulting base guarantee amount is: $237,500 x ( 1 - $7,500 / $177,500), or $227,464.79.
o        The Remaining Limit is set to zero (0) for the balance of the first Annuity Year.

Example 3. Reset of the Dollar-for-dollar Limit

A $10,000  withdrawal is made on December 19, 2004 (second Annuity Year).  The Remaining Limit has been reset to the  dollar-for-dollar
limit of $12,500. As the amount withdrawn is less than the dollar-for-dollar limit:
o        The base guarantee amount is reduced by the amount withdrawn (i.e., reduced by $10,000, from $227,464.79 to $217,464.79).
o        The  Remaining  Limit for the balance of the second  Annuity Year is also  reduced by the amount  withdrawn  (from  $12,500 to
         $2,500).

KEY FEATURE - Allocation of Account Value
In general,  you have discretion over the allocation of your Account Value that remains allocated in the variable  investment  options.
However,  we reserve the right to prohibit  investment in certain  Portfolios if you participate in the program.  Account Value is only
transferred  to and  maintained  in Fixed  Allocations  to the extent we, in our sole  discretion,  deem it is necessary to support our
guarantee(s)  under the program.  This  permits your Annuity to  participate  in the upside  potential of the  Sub-accounts  while only
transferring  amounts to Fixed Allocations to protect against  significant  market downturns.  We monitor  fluctuations in your Account
Value  each  business  day,  as well as the  prevailing  interest  rates on Fixed  Allocations,  the  remaining  duration(s)  until the
applicable  maturity  date(s) and the amount of Account Value allocated to Fixed  Allocation(s)  relative to a "reallocation  trigger",
which  determines  whether  Account  Value must be  transferred  to or from Fixed  Allocation(s).  While you are not notified when your
Account Value reaches a reallocation  trigger,  you will receive a confirmation  statement indicating the transfer of a portion of your
Account Value either to or from Fixed Allocation(s).

|X|      If your Account Value is greater than or equal to the  reallocation  trigger,  your Account  Value in the variable  investment
     options will remain allocated according to your most recent  instructions.  If a portion of Account Value was previously allocated
     to a Fixed Allocation to support the applicable  guaranteed  amount, all or a portion of those amounts may be transferred from the
     Fixed Allocation and re-allocated to the variable  investment  options pro-rata according to your current  allocations  (including
     the model  allocations  under any asset  allocation  program you may have elected).  A Market Value  Adjustment will apply when we
     reallocate Account Value from a Fixed Allocation to the variable  investment  options,  which may result in a decrease or increase
     in your Account Value.

|X|      If your  Account  Value is less than the  reallocation  trigger,  a portion of your Account  Value in the variable  investment
     options  will be  transferred  to a new Fixed  Allocation(s)  to support  the  applicable  guaranteed  amount.  These  amounts are
     transferred on a pro-rata basis from the variable  investment  options.  The new Fixed  Allocation(s) will have a Guarantee Period
     equal to the time remaining until the applicable  maturity  date(s).  The Account Value  allocated to the new Fixed  Allocation(s)
     will be credited with the fixed  interest  rate(s) then being  credited to a new Fixed  Allocation(s)  maturing on the  applicable
     maturity  date(s) (rounded to the next highest yearly  duration).  The Account Value will remain invested in each applicable Fixed
     Allocation  until the  applicable  maturity date unless,  at an earlier  date,  your Account Value is greater than or equal to the
     reallocation  trigger and,  therefore,  amounts can be  transferred  to the variable  investment  options  while  maintaining  the
     guaranteed protection under the program (as described above).

=======================================================================================================================================
If a significant  amount of your Account Value is systematically  transferred to Fixed  Allocations to support the Protected  Principal
Value and/or the Enhanced  Protected  Principal Value during prolonged  market declines,  less of your Account Value may be immediately
available to participate in the upside potential of the variable  investment  options if there is a subsequent market recovery.  During
the period prior to the maturity date of the base guarantee or any enhanced  guarantee,  or any anniversary of such maturity date(s), a
significant  portion of your Account Value may be allocated to Fixed  Allocations to support any applicable  guaranteed  amount(s).  If
your Account  Value is less than the  reallocation  trigger and new Fixed  Allocations  must be  established  during  periods where the
interest  rate(s) being  credited to such Fixed  Allocations  is extremely  low, a larger  portion of your Account Value may need to be
transferred to Fixed Allocations to support the applicable guaranteed amount(s).
=======================================================================================================================================

Separate Fixed Allocations may be established in support of the Protected  Principal Value and the Enhanced  Protected  Principal Value
(if elected).  There may also be circumstances  when a Fixed Allocation will be established only in support of the Protected  Principal
Value or the  Enhanced  Protected  Principal  Value.  If you elect an  enhanced  guarantee,  it is more  likely  that a portion of your
Account  Value may be allocated to Fixed  Allocations  and will remain  allocated  for a longer  period of time to support the Enhanced
Protected  Principal Value,  even during a period of positive market  performance  and/or under  circumstances  where Fixed Allocations
would not be necessary to support the Protected  Principal  Value.  Further,  there may be  circumstances  where Fixed  Allocations  in
support of the Protected  Principal Value are transferred to the variable  investment  options while Fixed Allocations in support of an
Enhanced  Protected  Principal  Value are not transferred  because they must remain invested in the Fixed  Allocation in support of the
higher enhanced guarantee.

American  Skandia uses an  allocation  mechanism  based on  assumptions  of expected and maximum  market  volatility  to determine  the
reallocation  trigger.  The  allocation  mechanism is used to determine the allocation of Account Value between Fixed  Allocations  and
the Sub-accounts you choose.  American  Skandia reserves the right to change the allocation  mechanism and the reallocation  trigger at
its discretion,  subject to regulatory  approval where required.  Changes to the allocation  mechanism and/or the reallocation  trigger
may be applied to existing programs where allowed by law.

Election of the Program
The  Guaranteed  Return  Option  Plus  program  can be elected at the time that you  purchase  your  Annuity,  or on any  business  day
thereafter (prior to  annuitization).  If you elect the program after the Issue Date of your Annuity,  the program will be effective as
of the business day that we receive the required  documentation  in good order at our home office,  and the  guaranteed  amount will be
based on your Account Value as of that date.  If you  previously  elected the  Guaranteed  Return Option  program and wish to elect the
Guaranteed  Return Option Plus program,  your prior  Guaranteed  Return Option  program will be terminated  (including  the  guaranteed
amount(s))  and the  Guaranteed  Return  Option Plus program will be added to your Annuity  based on the current  Account  Value.  This
election of GRO PlusSM may result in a market value adjustment, which could increase or decrease your Account Value.

Termination of the Program
The Annuity  Owner can elect to terminate  the enhanced  guarantee  but maintain the  protection  provided by the base  guarantee.  The
Annuity Owner also can terminate  the  Guaranteed  Return Option Plus program  entirely.  An Annuity Owner who  terminates  the program
entirely can  subsequently  elect to  participate  in the program  again (based on the Account  Value on that date) by  furnishing  the
documentation we require.  In a rising market,  an Annuity Owner could, for example,  terminate the program on a given business day and
two weeks later  reinstate the program with a higher base guarantee (and a new maturity date).  However,  your ability to reinstate the
program is limited by the  following:  (A) in any Annuity  Year,  we do not permit more than two  program  elections  and (B) a program
reinstatement cannot be effected on the same business day on which a program termination was effected.

The program will terminate  automatically  upon: (a) the death of the Owner or the Annuitant (in an entity owned  contract);  (b) as of
the date Account  Value is applied to begin  annuity  payments;  or (c) upon full  surrender of the Annuity.  If you elect to terminate
the program prior to the  applicable  maturity  date,  the  Guaranteed  Return  Option Plus will no longer  provide a guarantee of your
Account  Value.  The surviving  spouse may elect the benefit at any time after the death of the Annuity Owner.  The surviving  spouse's
election  will be effective on the business day that we receive the required  documentation  in good order at our home office,  and the
Account Value on that business day will be the Protected Principal Value.

The charge for the  Guaranteed  Return Option Plus program will no longer be deducted from your Account Value upon  termination  of the
program.


Special Considerations under the Guaranteed Return Option Plus
This program is subject to certain rules and restrictions, including, but not limited to the following:
|X|      Upon  inception of the program,  100% of your Account  Value must be allocated to the variable  investment  options.  No Fixed
     Allocations may be in effect as of the date that you elect to participate in the program.  However,  the reallocation  trigger may
     transfer Account Value to Fixed Allocations as of the effective date of the program under some circumstances.
|X|      Annuity  Owners  cannot  allocate any portion of Purchase  Payments or transfer  Account  Value to or from a Fixed  Allocation
     while participating in the program,  and cannot participate in any dollar cost averaging program that transfers Account Value from
     a Fixed Allocation to the variable investment options.
|X|      Additional  Purchase Payments  (including any credits associated with such Purchase Payments) applied to the Annuity while the
     program is in effect will increase the applicable  guarantee amount by the actual amount of the Purchase Payment;  however, all or
     a portion of any additional  Purchase Payments  (including any credits associated with such Purchase Payments) may be allocated by
     us to Fixed Allocations to support the additional amount guaranteed.
|X|      Transfers  from Fixed  Allocations  will be subject to the Market Value  Adjustment  formula under the Annuity;  however,  the
     0.10%  "cushion"  feature of the formula will not apply. A Market Value  Adjustment may be either  positive or negative.  Transfer
     amounts will be taken from the most recently applied Fixed Allocation.
|X|      Transfers from the  Sub-accounts to Fixed  Allocations or from Fixed  Allocations to the  Sub-accounts  under the program will
     not count toward the maximum number of free transfers allowable under the Annuity.
|X|      Any amounts  applied to your Account Value by American  Skandia on the maturity date or any  anniversary  of the maturity date
     will not be treated as "investment in the contract" for income tax purposes.

Charges under the Program
We deduct a charge equal to 0.25% of Account Value per year to  participate in the  Guaranteed  Return Option Plus program.  The annual
charge is deducted  daily against your Account  Value  allocated to the  Sub-accounts.  Account  Value  allocated to Fixed  Allocations
under the program is not subject to the charge.  The charge is deducted to  compensate  American  Skandia  for:  (a) the risk that your
Account Value on the maturity date is less than the amount guaranteed; and (b) administration of the program.

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In those  jurisdictions  where we have not received  regulatory  approval for the Guaranteed Return Option Plus program,  we may offer,
where  available,   the  Guaranteed  Return  Option  program  described  below.   Certain  terms  and  conditions  may  differ  between
jurisdictions.  The  Guaranteed  Return Option  program is not  available if you elect the  Guaranteed  Return  Option Plus rider,  the
Guaranteed Minimum Withdrawal Benefit rider or the Guaranteed Minimum Income Benefit rider.
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Guaranteed Return Option (GRO)SM
We also offer a  seven-year  program  where we monitor your Account  Value daily and  systematically  transfer  amounts  between  Fixed
Allocations  and the variable  investment  options you choose.  American  Skandia  guarantees that at the end of the seventh (7th) year
from  commencement  of the program (or any program  restart  date),  you will receive no less than your  Account  Value on the date you
elected to  participate  in the program  ("commencement  value").  On the program  maturity  date,  if your Account  Value is below the
commencement  value,  American Skandia will apply additional  amounts to your Annuity so that it is equal to commencement value or your
Account  Value on the date you elect to restart the program  duration.  Any amounts  added to your  Annuity  will be applied to the AST
Money  Market  Sub-account,  unless you provide us with  alternative  instructions.  We will  notify you of any  amounts  added to your
Annuity  under the program.  We do not  consider  amounts  added to your  Annuity to be  "investment  in the  contract"  for income tax
purposes.

Account  Value is only  transferred  to and  maintained  in Fixed  Allocations  to the  extent we, in our sole  discretion,  deem it is
necessary  to support our  guarantee  under the  program.  This differs  from the  Balanced  Investment  Program  where a set amount is
allocated to a Fixed  Allocation  regardless of the  performance of the  underlying  Sub-accounts.  With the Guaranteed  Return Option,
your Annuity is able to participate in the upside potential of the Sub-accounts  while only  transferring  amounts to Fixed Allocations
to protect against  significant  market downturns.  NOTE: If a significant  amount of your Account Value is systematically  transferred
to Fixed Allocations  during prolonged market declines,  less of your Account Value may be immediately  available to participate in the
upside potential of the Sub-accounts if there is a subsequent market recovery.

Each  business day we monitor the  performance  of your Account Value to determine  whether it is greater  than,  equal to or below our
"reallocation  trigger",  described  below.  Based on the performance of the  Sub-accounts in which you choose to allocate your Account
Value  relative to the  reallocation  trigger,  we may transfer  some or all of your Account Value to or from a Fixed  Allocation.  You
have  complete  discretion  over the  allocation  of your Account  Value that remains  allocated  in the variable  investment  options.
However, we reserve the right to restrict certain Portfolios if you participate in the program.

|X|      Account Value greater than or equal to reallocation  trigger:  Your Account Value in the variable  investment  options remains
              allocated according to your most recent  instructions.  If a portion of Account Value was previously allocated to a Fixed
              Allocation,  those amounts may be transferred  from the Fixed  Allocation  and  re-allocated  to the variable  investment
              options pro-rata according to your current allocations.  A Market Value Adjustment will apply.

|X|      Account Value below reallocation  trigger:  A portion of your Account Value in the variable  investment options is transferred
              to a new Fixed Allocation.  These amounts are transferred on a pro-rata basis from the variable investment  options.  The
              new Fixed Allocation will have a Guarantee Period equal to the remaining  duration in the Guaranteed  Return Option.  The
              Account Value applied to the new Fixed  Allocation  will be credited with the fixed interest rate then being applied to a
              new Fixed Allocation of the next higher yearly  duration.  The Account Value will remain invested in the Fixed Allocation
              until the maturity date of the program  unless,  at an earlier date,  your Account Value is at or above the  reallocation
              trigger and amounts can be transferred to the variable  investment  options (as described  above) while  maintaining  the
              guarantee protection under the program.

American  Skandia uses an  allocation  mechanism  based on  assumptions  of expected and maximum  market  volatility  to determine  the
reallocation  trigger.  The  allocation  mechanism is used to determine the allocation of Account Value between Fixed  Allocations  and
the Sub-accounts you choose.  American  Skandia reserves the right to change the allocation  mechanism and the reallocation  trigger at
its  discretion,  subject to regulatory  approval  where  required.  Any change to the  allocation  mechanism  and/or the  reallocation
trigger will only apply to programs that begin after the change is effective.

Program Termination
The Guaranteed  Return Option will  terminate on its maturity  date. You can elect to participate in a new Guaranteed  Return Option or
re-allocate  your  Account  Value at that time.  Upon  termination,  any  Account  Value  allocated  to the Fixed  Allocations  will be
transferred to the AST Money Market Sub-account, unless you provide us with alternative instructions.

Special Considerations under the Guaranteed Return Option
This program is subject to certain rules and restrictions, including, but not limited to the following:
|X|      You may  terminate  the  Guaranteed  Return  Option at any  time.  American  Skandia  does not  provide  any  guarantees  upon
     termination of the program.
|X|      Withdrawals  from your  Annuity  while the  program  is in effect  will  reduce the  guaranteed  amount  under the  program in
     proportion  to your  Account  Value at the time of the  withdrawal.  Withdrawals  will be subject to all other  provisions  of the
     Annuity, including any Contingent Deferred Sales Charge or Market Value Adjustment that would apply.
|X|      Additional  Purchase Payments applied to the Annuity while the program is in effect will only increase the amount  guaranteed;
     however, all or a portion of any additional Purchase Payments may be allocated to the Fixed Allocations.
|X|      Annuity Owners cannot  transfer  Account Value to or from a Fixed  Allocation  while  participating  in the program and cannot
     participate in any dollar cost averaging program that transfers  Account Value from a Fixed Allocation to the variable  investment
     options.
|X|      Transfers  from Fixed  Allocations  will be subject to the Market Value  Adjustment  formula under the Annuity;  however,  the
     0.10%  "cushion"  feature of the formula will not apply. A Market Value  Adjustment may be either  positive or negative.  Transfer
     amounts will be taken from the most recently applied Fixed Allocation.
|X|      Transfers from the  Sub-accounts to Fixed  Allocations or from Fixed  Allocations to the  Sub-accounts  under the program will
     not count toward the maximum number of free transfers allowable under the Annuity.
|X|      The Guaranteed  Return Option will terminate:  (a) upon the death of the Owner or the Annuitant (in an entity owned contract);
     and (b) as of the date Account Value is applied to begin annuity payments.
|X|      You can elect to  restart  the seven (7) year  program  duration  on any  anniversary  of the Issue Date of the  Annuity.  The
     Account Value on the date the restart is effective  will become the new  commencement  value.  You can only elect the program once
     per Annuity Year.

Charges under the Program
We deduct a charge  equal to 0.25% per year to  participate  in the  Guaranteed  Return  Option.  The annual  charge is deducted  daily
against your Account  Value  allocated to the  Sub-accounts.  Account  Value  allocated to Fixed  Allocations  under the program is not
subject to the charge.  The charge is  deducted  to  compensate  American  Skandia  for:  (a) the risk that your  Account  Value on the
maturity date of the program is less than the amount guaranteed; and (b) administration of the program.

GUARANTEED MINIMUM WITHDRAWAL BENEFIT (GMWB)

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The Guaranteed  Minimum  Withdrawal  Benefit  program  described below is being offered in those  jurisdictions  where we have received
regulatory  approval  and  will be  offered  subsequently  in  other  jurisdictions  when  we  receive  regulatory  approval  in  those
jurisdictions.  Certain terms and  conditions  may differ  between  jurisdictions  once  approved.  Currently,  the program can only be
elected by new  purchasers  on the Issue Date of their  Annuity.  We may offer the  program to existing  Annuity  Owners in the future,
subject to our eligibility  rules and restrictions.  The Guaranteed  Minimum  Withdrawal  Benefit program is not available if you elect
the Guaranteed Return Option, Guaranteed Return Option Plus, or the Guaranteed Minimum Income Benefit rider.
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We offer a program  that  guarantees  your ability to withdraw  amounts  equal to an initial  principal  value  (called the  "Protected
Withdrawal  Value"),  regardless of the impact of market performance on your Account Value,  subject to our program rules regarding the
timing and amount of  withdrawals.  The program may be  appropriate  if you intend to make periodic  withdrawals  from your Annuity and
wish to ensure  that  market  performance  will not affect  your  ability to  protect  your  principal.  You are not  required  to make
withdrawals  as part of the program - the  guarantee is not lost if you withdraw  less than the maximum  allowable  amount of principal
each year under the rules of the program.  There is an  additional  charge if you elect the GMWB  program;  however,  the charge may be
waived under certain circumstances described below.

KEY FEATURE - Protected Withdrawal Value
The Protected  Withdrawal  Value is the total amount that we guarantee will be available to you through  withdrawals  from your Annuity
and/or  benefit  payments,  regardless of the impact of market  performance on your Account Value.  The Protected  Withdrawal  Value is
reduced with each  withdrawal you make until the Protected  Withdrawal  Value is reduced to zero. When the Protected  Withdrawal  Value
is reduced to zero due to your  withdrawals,  the GMWB program  terminates.  Additionally,  the Protected  Withdrawal  Value is used to
determine the maximum annual amount that you can withdraw from your Annuity,  called the Protected Annual  Withdrawal  Amount,  without
triggering an adjustment in the Protected  Withdrawal  Value.  The Protected  Withdrawal  Value is referred to as the "Benefit Base" in
the rider we issue for this benefit.

The Protected  Withdrawal Value is determined as of the date you make your first  withdrawal under the Annuity  following your election
of the GMWB  program.  The initial  Protected  Withdrawal  Value is equal to the greater of (A) the Account Value on the date you elect
the GMWB program,  plus any additional  Purchase Payments and any Credits that may be applied to such Purchase Payments before the date
of your  first  withdrawal;  or (B) the  Account  Value as of the  date of the  first  withdrawal  from  your  Annuity.  The  Protected
Withdrawal Value may be enhanced by increases in your Account Value due to market  performance  during the period between your election
of the GMWB program and the date of your first withdrawal.

|X|      If you elect the GMWB program at the time you purchase your Annuity,  the Account Value will be your initial  Purchase Payment
     plus any Credit applied to such Purchase Payment.

|X|      If we offer the GMWB  program to existing  Annuity  Owners,  the Account  Value on the  anniversary  of the Issue Date of your
     Annuity following your election of the GMWB program will be used to determine the initial Protected Withdrawal Value.

|X|      If you make additional  Purchase  Payments after your first  withdrawal,  the Protected  Withdrawal Value will be increased by
     the amount of the additional Purchase Payment and any Credits that we apply to the Purchase Payment.

You may elect to step-up your Protected  Withdrawal  Value if, due to positive market  performance,  your Account Value is greater than
the Protected  Withdrawal  Value. You are eligible to step-up the Protected  Withdrawal Value on or after the 5th contract  anniversary
following the first  withdrawal  under the GMWB program.  The  Protected  Withdrawal  Value can be stepped up again on or after the 5th
contract  anniversary  following the preceding step-up.  If you elect to step-up the Protected  Withdrawal Value, you must do so during
the 30-day period prior to your  eligibility  date. If you elect to step-up the Protected  Withdrawal  Value under the program,  and on
the date you elect to step-up,  the charges under the GMWB program have changed for new purchasers,  your program may be subject to the
new charge going forward.

Upon election of the step-up,  we reset the Protected  Withdrawal  Value to be equal to the then current  Account  Value.  For example,
assume your  initial  Protected  Withdrawal  Value was  $100,000  and you have made  cumulative  withdrawals  of $40,000,  reducing the
Protected  Withdrawal Value to $60,000.  On the date you are eligible to step-up the Protected  Withdrawal Value, your Account Value is
equal to $75,000.  You could elect to step-up the Protected  Withdrawal  Value to $75,000 on the date you are  eligible.  Upon election
of the step-up,  we also reset the Protected Annual Withdrawal Amount (discussed  immediately  below) to be equal to the greater of (A)
the Protected Annual Withdrawal Amount  immediately prior to the reset; and (B) 7% of the Protected  Withdrawal Value immediately after
the reset.

KEY FEATURE - Protected Annual Withdrawal Amount
The initial  Protected Annual  Withdrawal  Amount is equal to 7% of the Protected  Withdrawal  Value.  Under the GMWB program,  if your
cumulative  withdrawals each Annuity Year are less than or equal to the Protected Annual Withdrawal Amount,  your Protected  Withdrawal
Value  will be  reduced  on a  "dollar-for-dollar"  basis (the  Protected  Withdrawal  Value is  reduced  by the  actual  amount of the
withdrawal,  including any CDSC or MVA that may apply).  Cumulative  withdrawals  in any Annuity Year that exceed the Protected  Annual
Withdrawal  Amount  trigger a  proportional  adjustment to both the Protected  Withdrawal  Value and the  Protected  Annual  Withdrawal
Amount,  as described in the rider for this benefit (see the examples of this  calculation  below).  The  Protected  Annual  Withdrawal
Amount is referred to as the "Maximum Annual Benefit" in the rider we issue for this benefit.


The GMWB  program  does not affect your ability to make  withdrawals  under your  Annuity or limit your ability to request  withdrawals
that exceed the  Protected  Annual  Withdrawal  Amount.  You are not  required to withdraw all or any portion of the  Protected  Annual
Withdrawal Amount each Annuity Year.
|X|      If,  cumulatively,  you withdraw an amount less than the Protected  Annual  Withdrawal  Amount in any Annuity Year, you cannot
     carry-over  the unused  portion of the Protected  Annual  Withdrawal  Amount to subsequent  Annuity  Years.  However,  because the
     Protected  Withdrawal  Value is only reduced by the actual amount of withdrawals  you make under these  circumstances,  any unused
     Protected  Annual  Withdrawal  Amount may extend the period of time until the remaining  Protected  Withdrawal Value is reduced to
     zero.
|X|      Additional  Purchase Payments will increase the Protected Annual  Withdrawal  Amount by 7% of the applicable  Purchase Payment
     (and any Credits we apply to such Purchase Payment).
|X|      If the Protected Annual  Withdrawal  Amount after an adjustment  exceeds the Protected  Withdrawal Value, the Protected Annual
     Withdrawal Amount will be set equal to the Protected Withdrawal Value.

The following  examples of dollar-for  dollar and proportional  reductions and the reset of the Maximum Annual Benefit assume that: 1.)
the Issue Date and the effective  date of the GMWB program are October 13, 2003;  2.) an initial  Purchase  Payment of $250,000;  3.) a
Protected Withdrawal Value of $250,000; and 4.) a Protected Annual Withdrawal Amount of $17,500 (7% of $250,000):

Example 1. Dollar-for-dollar reduction

A $10,000  withdrawal is taken on November 13, 2003 (in the first Annuity Year).  No prior  withdrawals  have been taken. As the amount
withdrawn is less than the Protected Annual Withdrawal Amount:
o        The Protected Withdrawal Value is reduced by the amount withdrawn (i.e., by $10,000, from $250,000 to $240,000).
o        The  remaining  Protected  Annual  Withdrawal  Amount for the balance of the first  Annuity Year is also reduced by the amount
         withdrawn (from $17,500 to $7,500).

Example 2. Dollar-for-dollar and proportional reductions

A second  $10,000  withdrawal  is taken on December 13, 2003 (still  within the first  Annuity  Year).  The Account  Value  immediately
before the withdrawal is $220,000.  As the amount withdrawn  exceeds the remaining  Protected Annual  Withdrawal  Amount of $7,500 from
Example 1:
o        the  Protected  Withdrawal  Value is first reduced by the  remaining  Protected  Annual  Withdrawal  Amount (from  $240,000 to
     $232,500);
o        The result is then further reduced by the ratio of A to B, where:
o        A is the amount withdrawn less the remaining Protected Annual Withdrawal Amount ($10,000 - $7,500, or $2,500).
o        B is the Account Value less the remaining Protected Annual Withdrawal Amount ($220,000 - $7,500, or $212,500).
     The resulting Protected Withdrawal Value is: $232,500 x ( 1 - $2,500 / $212,500), or $229,764.71.
o        the Protected  Annual  Withdrawal  Amount is also reduced by the ratio of A to B: The resulting  Protected  Annual  Withdrawal
     Amount is: $17,500 x ( 1 - $2,500 / $212,500), or $17,294.12.
o        The remaining Protected Annual Withdrawal Amount is set to zero (0) for the balance of the first Annuity Year.

Example 3. Reset of the Maximum Annual Benefit

A $10,000  withdrawal is made on October 13, 2004 (second Annuity Year).  The remaining  Protected  Annual  Withdrawal  Amount has been
reset to the  Protected  Annual  Withdrawal  Amount of  $17,294.12  from Example 2. As the amount  withdrawn is less than the remaining
Protected Annual Withdrawal Amount:
o        the  Protected  Withdrawal  Value is  reduced  by the  amount  withdrawn  (i.e.,  reduced  by  $10,000,  from  $229,764.71  to
         $219,764.71).
o        The remaining  Protected  Annual  Withdrawal  Amount for the balance of the second  Annuity Year is also reduced by the amount
         withdrawn (from $17,294.12 to $7,294.12).

BENEFITS UNDER THE GMWB PROGRAM

|X|      In addition to any  withdrawals  you make under the GMWB program,  market  performance  may reduce your Account Value. If your
     Account Value is equal to zero, and you have not received all of your Protected  Withdrawal  Value in the form of withdrawals from
     your Annuity, we will continue to make payments equal to the remaining Protected  Withdrawal Value in the form of fixed,  periodic
     payments until the remainder of the Protected  Withdrawal Value is paid, at which time the rider terminates.  The fixed,  periodic
     payments  will each be equal to the  Protected  Annual  Withdrawal  Amount,  except for the last payment which may be equal to the
     remaining  Protected  Withdrawal  Value. We will determine the duration for which periodic  payments will continue by dividing the
     Protected  Withdrawal Value by the Protected Annual  Withdrawal  Amount.  You will not have the right to make additional  Purchase
     Payments or receive the remaining  Protected  Withdrawal Value in a lump sum. You can elect the frequency of payments,  subject to
     our rules then in effect.

|X|      If the death benefit under the Annuity  becomes  payable  before you have received all of your Protected  Withdrawal  Value in
     the form of withdrawals from your Annuity,  your Beneficiary has the option to elect to receive the remaining Protected Withdrawal
     Value as an  alternate  death  benefit  payout in lieu of the amount  payable  under any other death  benefit  provided  under the
     Annuity.  The remaining Protected Withdrawal Value will be payable in the form of fixed,  periodic payments.  Your beneficiary can
     elect the frequency of payments,  subject to our rules then in effect.  We will determine the duration for which periodic payments
     will continue by dividing the Protected  Withdrawal  Value by the Protected Annual  Withdrawal  Amount.  The Protected  Withdrawal
     Value is not equal to the Account  Value for purposes of the  Annuity's  other death  benefit  options.  The GMWB program does not
     increase or decrease the amount  otherwise  payable under the Annuity's other death benefit options.  Generally,  the GMWB program
     would be of value to your  Beneficiary  only when the Protected  Withdrawal Value at death exceeds any other amount available as a
     death benefit.

|X|      If you elect to begin receiving  annuity payments before you have received all of your Protected  Withdrawal Value in the form
     of withdrawals from your Annuity,  an additional  annuity payment option will be available that makes fixed annuity payments for a
     certain period,  determined by dividing the Protected  Withdrawal Value by the Protected Annual Withdrawal Amount. If you elect to
     receive annuity  payments  calculated in this manner,  the assumed interest rate used to calculate such payments will be 0%, which
     is less than the assumed  interest rate on other annuity payment options we offer.  This 0% assumed interest rate results in lower
     annuity  payments than what would have been paid if the assumed  interest rate was higher than 0%. You can also elect to terminate
     the GMWB program and begin  receiving  annuity  payments  based on your then current  Account Value (not the  remaining  Protected
     Withdrawal Value) under any of the available annuity payment options.

Other Important Considerations
|X|      Withdrawals  under the GMWB program are subject to all of the terms and conditions of the Annuity,  including any CDSC and MVA
     that may apply.  Amounts  withdrawn up to the Protected Annual  Withdrawal  Amount will generally not be subject to any applicable
     CDSC since they are less than the amount available under any free withdrawal provision of your Annuity.
|X|      Withdrawals  made  while the GMWB  program  is in  effect  will be  treated,  for tax  purposes,  in the same way as any other
     withdrawals under the Annuity.
|X|      The GMWB program does not directly  affect the Annuity's  Account Value or Surrender  Value,  but any withdrawal will decrease
     the Account Value by the amount of the withdrawal.  If you surrender your Annuity,  you will receive the current  Surrender Value,
     not the Protected Withdrawal Value.
|X|      You can make  withdrawals  from your  Annuity  while your  Account  Value is greater  than zero  without  purchasing  the GMWB
     program.  The GMWB program  provides a guarantee that if your Account Value declines due to market  performance,  you will be able
     to receive your Protected Withdrawal Value in the form of periodic benefit payments.
|X|      We reserve the right to impose  restrictions  on the allocation of your Account Value,  including  prohibiting  allocations to
     certain Portfolios.  We may also require that you allocate your Account Value according to an asset allocation model,  although it
     is not our current requirement.

Election of the Program
Currently,  the GMWB program can only be elected at the time that you  purchase  your  Annuity.  In the future,  we may offer  existing
Annuity  Owners the  option to elect the GMWB  program  after the Issue Date of their  Annuity,  subject to our  eligibility  rules and
restrictions.  If you elect the GMWB  program  after the Issue Date of your  Annuity,  the  program  will be  effective  as of the next
anniversary  date. Your Account Value as of such  anniversary  date will be used to calculate the initial  Protected  Withdrawal  Value
and the initial Protected Annual Withdrawal Amount.

We reserve the right to restrict the maximum  amount of Protected  Withdrawal  Value that may be covered  under the GMWB program  under
this Annuity or any other annuities that you own that are issued by American Skandia or its affiliated companies.

Termination of the Program
The program  terminates  automatically when your Protected  Withdrawal Value reaches zero based on your withdrawals.  You may terminate
the program at any time by notifying  us. If you  terminate the program,  any  guarantee  provided by the benefit will  terminate as of
the date the  termination is effective.  The program  terminates  upon your  surrender of the Annuity,  upon due proof of death (unless
your surviving  spouse elects to continue the Annuity and the GMWB program or your  Beneficiary  elects to receive the amounts  payable
under the GMWB program in lieu of the death benefit) or upon your election to begin receiving annuity payments.

The charge for the GMWB program will no longer be deducted from your Account Value upon termination of the program.


Charges under the Program
Currently,  we deduct a charge equal to 0.35% of Account  Value per year to purchase the GMWB  program.  The annual  charge is deducted
daily against your Account Value  allocated to the  Sub-accounts.  Account Value  allocated to Fixed  Allocations  under the program is
not subject to the charge.

|X|      If, during the seven Annuity Years following the effective date of the program,  you do not make any  withdrawals,  and do not
     make any additional  Purchase  Payments  after a five-year  period  following the effective date of the program,  the program will
     remain in effect;  however,  we will waive the annual charge going forward.  If you make an additional  Purchase Payment following
     the waiver of the annual charge, we will begin charging for the program.

|X|      If you elect to step-up the Protected  Withdrawal Value under the program,  and on the date you elect to step-up,  the charges
     under the program have changed for new purchasers, your program may be subject to the new charge level for the benefit.

Additional Tax Considerations for Qualified Contracts
If you purchase an Annuity as an investment vehicle for "qualified"  investments,  including an IRA, SEP-IRA, Roth IRA or Tax Sheltered
Annuity (or  403(b)),  the minimum  distribution  rules under the Code  require  that you begin  receiving  periodic  amounts from your
Annuity  beginning  after age 70 1/2. The amount required under the Code may exceed the Protected  Annual  Withdrawal  Amount,  which will
cause us to  recalculate  the  Protected  Withdrawal  Value and the Protected  Annual  Withdrawal  Amount,  resulting in a lower amount
payable in future  Annuity  Years.  In  addition,  the amount and  duration of payments  under the  annuity  payment and death  benefit
provisions  may be adjusted so that the payments do not trigger any penalty or excise taxes due to tax  considerations  such as minimum
distribution requirements.

GUARANTEED MINIMUM INCOME BENEFIT (GMIB)

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The  Guaranteed  Minimum  Income  Benefit  program  described  below is being  offered in those  jurisdictions  where we have  received
regulatory  approval,  and  will be  offered  subsequently  in  other  jurisdictions  when we  receive  regulatory  approval  in  those
jurisdictions.  Certain terms and  conditions  may differ  between  jurisdictions  once  approved.  Currently,  the program can only be
elected by new  purchasers  on the Issue Date of their  Annuity.  We may offer the  program to existing  Annuity  Owners in the future,
subject to our  eligibility  rules and  restrictions.  The Guaranteed  Minimum Income Benefit program is not available if you elect the
Guaranteed Return Option program, Guaranteed Return Option Plus program or the Guaranteed Minimum Withdrawal Benefit rider.
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We offer a program that,  after a seven-year  waiting period,  guarantees  your ability to begin receiving  income from your Annuity in
the form of annuity  payments  based on a guaranteed  minimum value (called the  "Protected  Income  Value") that  increases  after the
waiting period begins,  regardless of the impact of market  performance on your Account Value.  The program may be appropriate  for you
if you anticipate  using your Annuity as a future source of periodic  fixed income  payments for the remainder of your life and wish to
ensure that the basis upon which your income  payments  will be  calculated  will achieve at least a minimum  amount of growth  despite
fluctuations in market performance.  There is an additional charge if you elect the GMIB program.

KEY FEATURE - Protected Income Value
The Protected  Income Value is the minimum amount that we guarantee will be available (net of any applicable  premium  taxes),  after a
waiting  period of at least  seven  years,  to begin  receiving  fixed  annuity  payments.  The  Protected  Income  Value is  initially
established on the effective  date of the GMIB program and is equal to your Account Value on such date.  The Protected  Income Value is
increased  daily based on an annual growth rate of 5%,  subject to the  limitations  described  below.  The  Protected  Income Value is
referred  to as the  "Protected  Value"  in the rider we issue  for this  benefit.  The 5% annual  growth  rate is  referred  to as the
"Roll-Up Percentage" in the rider we issue for this benefit.

The Protected  Income Value is subject to a limit of 200% (2X) of the sum of the Protected  Income Value  established  on the effective
date of the GMIB program plus any additional  Purchase  Payments and any Credits that are applied to such Purchase  Payments made after
the waiting period begins  ("Maximum  Protected  Income Value"),  minus the sum of any reductions in the Protected  Income Value due to
withdrawals you make from the Annuity after the waiting period begins.

|X|      Subject to the maximum  age/durational  limits  described  immediately  below, we will no longer increase the Protected Income
     Value by the 5% annual  growth rate once you reach the Maximum  Protected  Income Value.  However,  we will increase the Protected
     Income Value by the amount of any additional  Purchase  Payments and any Credits applied to such Purchase Payments after you reach
     the Maximum Protected Income Value.  Further,  if you make withdrawals after you reach the Maximum Protected Income Value, we will
     reduce the Protected Income Value by the proportional impact of the withdrawal on your Account Value.

|X|      Subject to the Maximum  Protected  Income Value, we will no longer increase the Protected Income Value by the 5% annual growth
     rate after the later of the anniversary  date on or immediately  following the Annuitant's 80th birthday or the 7th anniversary of
     the later of the effective date of the GMIB program or the effective date of the most recent  step-up.  However,  we will increase
     the Protected Income Value by the amount of any additional  Purchase  Payments and any Credits applied to such Purchase  Payments.
     Further, if you make withdrawals after the Annuitant reaches the maximum  age/duration limits, we will reduce the Protected Income
     Value by the proportional impact of the withdrawal on your Account Value.

|X|      Subject to the Maximum  Protected  Income Value, if you make an additional  Purchase  Payment,  we will increase the Protected
     Income Value by the amount of the Purchase Payment  (including any Credits that may be applied to your Account Value based on such
     Purchase Payment) and will apply the 5% annual growth rate on the new amount from the date the Purchase Payment is applied.

|X|      As  described  below,  after the waiting  period  begins,  cumulative  withdrawals  each Annuity Year that are up to 5% of the
     Protected  Income  Value will reduce the  Protected  Income Value by the amount of the  withdrawal.  Cumulative  withdrawals  each
     Annuity Year in excess of 5% of the Protected  Income Value will reduce the Protected  Income Value  proportionately.  Withdrawals
     after the Maximum Protected Income Value is reached will reduce the Protected Income Value  proportionately.  The 5% annual growth
     rate will be applied to the reduced Protected Income Value from the date of the withdrawal.

Stepping-Up  the Protected  Income Value - You may elect to "step-up" or "reset" your  Protected  Income Value if your Account Value is
greater than the current  Protected Income Value. Upon exercise of the step-up  provision,  your initial Protected Income Value will be
reset equal to your current  Account Value.  From the date that you elect to step-up the Protected  Income Value,  we will apply the 5%
annual growth rate to the stepped-up  Protected  Income Value, as described  above.  You can only exercise the step-up  provision twice
while the GMIB program is in effect, and only while the Annuitant is less than age 76.

|X|      A new seven-year  waiting period will be established  upon the effective date of your election to step-up the Protected Income
     Value.  You cannot  exercise  your right to begin  receiving  annuity  payments  under the GMIB  program  until the end of the new
     waiting period.
|X|      The Maximum  Protected  Income Value will be reset as of the effective date of any step-up.  The new Maximum  Protected Income
     Value will be equal to 200% of the sum of the Protected  Income Value as of the effective  date of the step-up plus any subsequent
     Purchase  Payments and any Credits applied to such Purchase  Payments,  minus the impact of any withdrawals  after the date of the
     step-up.
|X|      When determining the guaranteed  annuity purchase rates for annuity payments under the GMIB program,  we will apply such rates
     based on the number of years since the most recent step-up.
|X|      If you elect to step-up the  Protected  Income  Value  under the  program,  and on the date you elect to step-up,  the charges
     under the GMIB program have changed for new purchasers, your program may be subject to the new charge going forward.

Impact of Withdrawals on the Protected  Income Value - Cumulative  withdrawals each Annuity Year up to 5% of the Protected Income Value
will reduce the Protected  Income Value on a  "dollar-for-dollar"  basis (the Protected Income Value is reduced by the actual amount of
the  withdrawal).  Cumulative  withdrawals in any Annuity Year in excess of 5% of the Protected  Income Value will reduce the Protected
Income Value  proportionately  (see the examples of this  calculation  below).  The 5% annual  withdrawal  amount is determined on each
anniversary  of the Issue Date (or on the Issue Date for the first  Annuity  Year) and  applies to any  withdrawals  during the Annuity
Year. This means that the amount  available for  withdrawals  each Annuity Year on a  "dollar-for-dollar"  basis is adjusted to reflect
changes in the Protected Income Value during the prior Annuity Year.

The following examples of dollar-for-dollar  and proportional  reductions assume that: 1.) the Issue Date and the effective date of the
GMIB program are October 13, 2003; 2.) an initial  Purchase  Payment of $250,000;  3.) an initial  Protected  Income Value of $250,000;
and 4.) a dollar-for-dollar limit of $12,500 (5% of $250,000):

Example 1. Dollar-for-dollar reduction

A $10,000  withdrawal is taken on November 13, 2003 (in the first Annuity  Year).  No prior  withdrawals  have been taken.  Immediately
prior to the withdrawal,  the Protected Income Value is $251,038.10  (the initial value  accumulated for 31 days at an annual effective
rate of 5%).  As the amount withdrawn is less than the dollar-for-dollar limit:
o        the Protected Income Value is reduced by the amount withdrawn (i.e., by $10,000, from $251,038.10 to $241,038.10).
o        The remaining  dollar-for-dollar  limit  ("Remaining  Limit") for the balance of the first Annuity Year is also reduced by the
         amount withdrawn (from $12,500 to $2,500).

Example 2. Dollar-for-dollar and proportional reductions

A second $10,000  withdrawal is taken on December 13, 2003 (still within the first Annuity Year).  Immediately  before the  withdrawal,
the Account Value is $220,000 and the Protected  Income Value is $242,006.64.  As the amount  withdrawn  exceeds the Remaining Limit of
$2,500 from Example 1:
o        the Protected Income Value is first reduced by the Remaining Limit (from 242,006.64 to 239,506.64);
o        The result is then further reduced by the ratio of A to B, where:
o        A is the amount withdrawn less the Remaining Limit ($10,000 - $2,500, or $7,500).
o        B is the Account Value less the Remaining Limit ($220,000 - $2,500, or $217,500).
     The resulting Protected Income Value is: $239,506.64 x ( 1 - $7,500 / $217,500), or $231,247.79.
o        The Remaining Limit is set to zero (0) for the balance of the first Annuity Year.

Example 3. Reset of the Dollar-for-dollar Limit

A $10,000  withdrawal  is made on the first  anniversary  of the Issue Date,  October  13, 2004  (second  Annuity  Year).  Prior to the
withdrawal,  the Protected  Income Value is  $240,870.56.  The Remaining  Limit is reset to 5% of this amount,  or  $12,043.53.  As the
amount withdrawn is less than the dollar-for-dollar limit:
o        the Protected Income Value is reduced by the amount withdrawn (i.e., reduced by $10,000, from $240,870.56 to $230,870.56).
o        The Remaining  Limit for the balance of the second Annuity Year is also reduced by the amount  withdrawn  (from  $12,043.53 to
         $2,043.53).

KEY FEATURE - GMIB Annuity Payments
You can elect to apply the  Protected  Income  Value to one of the  available  GMIB Annuity  Payment  Options on any  anniversary  date
following the initial waiting period, or any subsequent  waiting period  established upon your election to step-up the Protected Income
Value.  Once you have  completed  the waiting  period,  you will have a 30-day  period each year,  prior to the  contract  anniversary,
during which you may elect to begin  receiving  annuity  payments under one of the available  GMIB Annuity  Payment  Options.  You must
elect one of the GMIB  Annuity  Payment  Options by the  anniversary  of the  Annuity's  Issue  Date on or  immediately  following  the
Annuitant's  95th birthday,  except for Annuities used as a funding  vehicle for an IRA, SEP IRA or 403(b),  in which the case you must
elect one of the GMIB  Annuity  Payment  Options by the  anniversary  of the  Annuity's  Issue  Date on or  immediately  following  the
Annuitant's 92nd birthday.

The amount of each GMIB Annuity  Payment  will be  determined  based on the age and,  where  permitted by law, sex of the  Annuitant by
applying  the  Protected  Income  Value (net of any  applicable  premium tax that may be due) to the GMIB  Annuity  Payment  Option you
choose.  We use special  annuity  purchase  rates to calculate the amount of each payment due under the GMIB Annuity  Payment  Options.
These special rates for the GMIB Annuity Payment Options are calculated  using an assumed  interest rate factor that provides for lower
growth in the value  applied to produce  annuity  payments than if you elected an annuity  payment  option that is not part of the GMIB
program.  These  special  rates  also  are  calculated  using  other  factors  such as "age  setbacks"  (use of an age  lower  than the
Annuitant's  actual age) that result in lower  payments than would result if you elected an annuity  payment option that is not part of
the GMIB  program.  Use of an age setback  entails a longer  assumed  life for the  Annuitant  which in turn  results in lower  annuity
payments.

On the date that you elect to begin receiving GMIB Annuity  Payments,  we guarantee that your payments will be calculated based on your
Account  Value and our then current  annuity  purchase  rates if the payment  amount  calculated  on this basis would be higher than it
would be based on the Protected Income Value and the special GMIB annuity purchase rates.

GMIB Annuity Payment Option 1 - Payments for Life with a Certain Period
Under this option,  monthly  annuity  payments  will be made until the death of the  Annuitant.  If the  Annuitant  dies before  having
received 120 monthly annuity payments, the remainder of the 120 monthly annuity payments will be made to the Beneficiary.

GMIB Annuity Payment Option 2 - Payments for Joint Lives with a Certain Period
Under this  option,  monthly  annuity  payments  will be made until the death of both the  Annuitant  and the Joint  Annuitant.  If the
Annuitant and the Joint  Annuitant die before having received 120 monthly  annuity  payments,  the remainder of the 120 monthly annuity
payments will be made to the Beneficiary.
|X|      If the Annuitant  dies first,  we will continue to make payments  until the later of the death of the Joint  Annuitant and the
     end of the period certain.  However,  if the Joint Annuitant is still receiving annuity payments  following the end of the certain
     period, we will reduce the amount of each subsequent payment to 50% of the original payment amount.
|X|      If the Joint  Annuitant  dies first,  we will continue to make payments  until the later of the death of the Annuitant and the
     end of the period certain.

You cannot  withdraw your Account Value or the Protected  Income Value under either GMIB Annuity  Payment Option once annuity  payments
have begun.  We may make other payout frequencies available, such as quarterly, semi-annually or annually.

Other Important Considerations
|X|      The GMIB program does not directly  affect the Annuity's  Account  Value,  Surrender  Value or the amount payable under either
     the basic death benefit  provision of the Annuity or any optional  death benefit  provision.  If you surrender  your Annuity,  you
     will receive the current  Surrender  Value,  not the Protected  Income Value. The Protected Income Value is only applicable if you
     elect to begin receiving annuity payments under one of the GMIB annuity options after the waiting period.
|X|      The Annuity offers other annuity  payment  options that you can elect which do not impose an additional  charge,  but which do
     not offer to guarantee a minimum value on which to make annuity payments.
|X|      Where allowed by law, we reserve the right to limit  subsequent  purchase  payments if we determine,  at our sole  discretion,
     that based on the timing of your Purchase  Payments and withdrawals,  your Protected Income Value is increasing in ways we did not
     intend. In determining whether to limit Purchase Payments, we will look at Purchase Payments which are  disproportionately  larger
     than your initial Purchase Payment and other actions that may artificially increase the Protected Income Value.
|X|      We reserve the right to impose  restrictions  on the allocation of your Account Value,  including  prohibiting  allocations to
     certain Portfolios.  We may also require that you allocate your Account Value according to an asset allocation model.
|X|      If you change the Annuitant  after the effective  date of the GMIB program,  the period of time during which we will apply the
     5% annual growth rate may be changed based on the age of the new  Annuitant.  If the new Annuitant  would not be eligible to elect
     the GMIB program based on his or her age at the time of the change, then the GMIB program will terminate.
|X|      Annuity payments made under the GMIB program are subject to the same tax treatment as any other annuity payment.
|X|      At the time you elect to begin  receiving  annuity  payments under the GMIB program or under any other annuity  payment option
     we make  available,  the  protection  provided by the Annuity's  basic death benefit or any optional  death benefit  provision you
     elected will no longer apply.

Election of the Program
Currently,  the GMIB program can only be elected at the time that you purchase  your Annuity.  The Annuitant  must be age 75 or less as
of the effective date of the GMIB program.  In the future,  we may offer  existing  Annuity Owners the option to elect the GMIB program
after the Issue Date of their  Annuity,  subject to our  eligibility  rules and  restrictions.  If you elect the GMIB program after the
Issue Date of your Annuity,  the program will be effective as of the next  anniversary  date.  Your Account Value as of the anniversary
date will be used to calculate the Protected Income Value as of the effective date of the program.

Termination of the Program
The GMIB  program  cannot be  terminated  by the Owner once  elected.  The GMIB  program  automatically  terminates  as of the date the
Annuity is fully  surrendered,  on the date the death benefit is payable to your  Beneficiary  (unless your surviving  spouse elects to
continue the Annuity),  or on the date that your Account Value is transferred to begin making  annuity  payments.  The GMIB program may
also be  terminated  if you  designate a new  Annuitant  who would not be eligible to elect the GMIB program based on his or her age at
the time of the change.

Upon  termination  of the GMIB program we will deduct the charge from your Account  Value for the portion of the Annuity Year since the
prior anniversary of the Annuity's Issue Date (or the Issue Date if in the first Annuity Year).

Charges under the Program
Currently,  we deduct a charge  equal to 0.50% per year of the  average  Protected  Income  Value for the period  the  charge  applies.
Because the charge is calculated  based on the average  Protected  Income Value,  it does not increase or decrease  based on changes to
the Annuity's  Account Value due to market  performance.  If the average  Protected  Income Value  increases,  the dollar amount of the
annual charge will increase, while a decrease in the Protected Income Value will decrease the dollar amount of the charge.

The charge is deducted  annually in arrears  each  Annuity  Year on the  anniversary  of the Issue Date of the  Annuity.  We deduct the
amount of the charge pro-rata from the Account Value allocated to the variable  investment  options and the Fixed  Allocations.  No MVA
will apply to Account Value deducted from a Fixed  Allocation.  If you surrender your Annuity,  begin receiving  annuity payments under
the GMIB program or any other annuity  payment  option we make  available  during an Annuity Year, or the GMIB program  terminates,  we
will deduct the charge for the portion of the Annuity Year since the prior  anniversary of the Annuity's  Issue Date (or the Issue Date
if in the first Annuity Year).

No charge applies after the Annuity Date.

DEATH BENEFIT

WHAT TRIGGERS THE PAYMENT OF A DEATH BENEFIT?

The Annuity  provides a Death Benefit  during its  accumulation  period.  If the Annuity is owned by one or more natural  persons,  the
Death  Benefit is payable  upon the first death of an Owner.  If the Annuity is owned by an entity,  the Death  Benefit is payable upon
the Annuitant's  death, if there is no Contingent  Annuitant.  If a Contingent  Annuitant was designated  before the Annuitant's  death
and the Annuitant  dies,  then the  Contingent  Annuitant  becomes the Annuitant and a Death Benefit will not be paid at that time. The
person upon whose death the Death Benefit is paid is referred to below as the "decedent."

Basic Death Benefit

The Annuity  provides a basic Death  Benefit at no  additional  charge.  The  Insurance  Charge we deduct daily from your Account Value
allocated to the  Sub-accounts is used, in part, to pay us for the risk we assume in providing the basic Death Benefit  guarantee under
the Annuity.  The Annuity also offers two  different  optional  Death  Benefits.  Either  benefit can be  purchased  for an  additional
charge.  The additional  charge is deducted to compensate  American  Skandia for providing  increased  insurance  protection  under the
optional Death Benefits.  Notwithstanding  the additional  protection  provided under the optional Death Benefits,  the additional cost
has the impact of reducing the net performance of the investment options.

The basic Death Benefit is the greater of:
|X|      The sum of all Purchase Payments less the sum of all proportional withdrawals.
|X|      The sum of your Account Value in the variable investment options and your Interim Value in the Fixed Allocations.

"Proportional  withdrawals" are determined by calculating the percentage of your Account Value that each prior  withdrawal  represented
when  withdrawn.  For example,  a withdrawal of 50% of Account  Value would be  considered as a 50% reduction in Purchase  Payments for
purposes of calculating the basic Death Benefit.

OPTIONAL DEATH BENEFITS

Two  optional  Death  Benefits  are  offered  for  purchase  with your  Annuity to provide an  enhanced  level of  protection  for your
beneficiaries.

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Currently,  these  benefits are only offered and must be elected at the time that you purchase your  Annuity.  We may, at a later date,
allow existing  Annuity Owners to purchase  either of the optional Death Benefits  subject to our rules and any changes or restrictions
in the  benefits.  Certain  terms and  conditions  may differ if you  purchase  your  Annuity as part of an  exchange,  replacement  or
transfer, in whole or in part, from any other Annuity we issue.
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Enhanced Beneficiary Protection Optional Death Benefit
The Enhanced  Beneficiary  Protection  Optional Death Benefit can provide  additional  amounts to your  Beneficiary that may be used to
offset  federal and state taxes  payable on any  taxable  gains in your  Annuity at the time of your  death.  Whether  this  benefit is
appropriate for you may depend on your  particular  circumstances,  including  other financial  resources that may be available to your
Beneficiary to pay taxes on your Annuity  should you die during the  accumulation  period.  No benefit is payable if death occurs on or
after the Annuity Date.

The  Enhanced  Beneficiary  Protection  Optional  Death  Benefit  provides a benefit  that is payable in  addition  to the basic  Death
Benefit.  If the  Annuity  has one Owner,  the Owner must be age 75 or less at the time the  benefit is  purchased.  If the Annuity has
joint Owners, the oldest Owner must be age 75 or less.  If the Annuity is owned by an entity, the Annuitant must be age 75 or less.


Calculation of Enhanced Beneficiary Protection Optional Death Benefit
If you purchase the Enhanced Beneficiary Protection Optional Death Benefit, the Death Benefit is calculated as follows:

1.       the basic Death Benefit described above;

     PLUS

2.       40% of your "Growth" under the Annuity, as defined below.

"Growth" means the sum of your Account Value in the variable investment options and your Interim Value in the Fixed Allocations,
minus the total of all Purchase Payments reduced by the sum of all proportional withdrawals.

"Proportional  withdrawals" are determined by calculating the percentage of your Account Value that each prior  withdrawal  represented
when withdrawn.

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The Enhanced  Beneficiary  Protection  Optional Death Benefit is subject to a maximum of 100% of all Purchase  Payments  applied to the
Annuity at least 12 months prior to the death of the decedent that triggers the payment of the Death Benefit.
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The Enhanced  Beneficiary  Protection Optional Death Benefit described above is currently being offered in those jurisdictions where we
have received regulatory  approval.  Certain terms and conditions may differ between  jurisdictions once approved.  Please refer to the
section entitled "Tax Considerations" for a discussion of special tax considerations for purchasers of this benefit.
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See Appendix C for examples of how the Enhanced Beneficiary Protection Optional Death Benefit is calculated.

Highest Anniversary Value Death Benefit
If the  Annuity  has one Owner,  the Owner must be age 79 or less at the time  Highest  Anniversary  Value  Optional  Death  Benefit is
purchased.  If the  Annuity  has joint  Owners,  the oldest  Owner must be age 79 or less.  If the  Annuity is owned by an entity,  the
Annuitant must be age 79 or less.

Certain of the Portfolios offered as Sub-accounts under the Annuity are not available if you elect the Highest Anniversary Value
Death Benefit.

Key Terms Used with the Highest Anniversary Value Death Benefit

|X|      The Death Benefit Target Date is the contract  anniversary  on or after the 80th birthday of the current Owner,  the oldest of
     either joint Owner or the Annuitant, if entity owned.

|X|      The Highest  Anniversary  Value equals the highest of all previous  "Anniversary  Value" less  proportional  withdrawals since
     such anniversary and plus any Purchase Payments since such anniversary.

|X|      The Anniversary  Value is the Account Value as of each  anniversary of the Issue Date of the Annuity.  The  Anniversary  Value
     on the Issue Date is equal to your Purchase Payment.

|X|      Proportional  withdrawals  result  in a  reduction  to the  Highest  Anniversary  Value  by  reducing  such  value in the same
     proportion  as the Account  Value was reduced by the  withdrawal  as of the date the  withdrawal  occurred.  For example,  if your
     Highest  Anniversary  Value is  $125,000  and you  subsequently  withdraw  $10,000 at a time when your  Account  Value is equal to
     $100,000 (a 10% reduction),  when calculating the optional Death Benefit we will reduce your Highest  Anniversary Value ($125,000)
     by 10% or $12,500.

Calculation of Highest Anniversary Value Death Benefit
The Highest Anniversary Value Death Benefit depends on whether death occurs before or after the Death Benefit Target Date.

         If the Owner dies before the Death Benefit Target Date, the Death Benefit equals the greater of:

1.       the basic Death Benefit described above; and
2.       the Highest Anniversary Value as of the Owner's date of death.



If the Owner dies on or after the Death Benefit Target Date, the Death Benefit equals the greater of:

1.       the basic Death Benefit described above; and
2.       the Highest  Anniversary  Value on the Death  Benefit  Target Date plus the sum of all Purchase  Payments  less the sum of all
              proportional withdrawals since the Death Benefit Target Date.

         The amount  determined by this calculation is increased by any Purchase  Payments received after the Owner's date of death and
         decreased by any proportional withdrawals since such date.

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The Highest  Anniversary Value Death Benefit described above is currently being offered in those  jurisdictions  where we have received
regulatory approval.  Certain terms and conditions may differ between jurisdictions once approved.
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See Appendix C for examples of how the Highest Anniversary Value Death Benefit is calculated.

Annuities with joint Owners
For Annuities  with Joint Owners,  the Death Benefit is calculated as shown above except that the age of the oldest of the Joint Owners
is used to  determine  the Death  Benefit  Target Date.  NOTE:  If you and your spouse own the Annuity  jointly,  we will pay the Death
Benefit to the  Beneficiary.  If the sole primary  Beneficiary is the surviving  spouse,  then the surviving spouse can elect to assume
ownership of the Annuity and continue the contract instead of receiving the Death Benefit.

Annuities owned by entities
For  Annuities  owned by an entity,  the Death  Benefit is  calculated  as shown above except that the age of the  Annuitant is used to
determine  the  Death  Benefit  Target  Date.  Payment  of the Death  Benefit  is based on the death of the  Annuitant  (or  Contingent
Annuitant, if applicable).

Can I terminate the optional Death Benefits?  Do the optional Death Benefits terminate under other circumstances?
You can terminate the Enhanced  Beneficiary  Protection  Optional Death Benefit and Highest Anniversary Value Optional Death Benefit at
any time.  Both optional  Death  Benefits will  terminate  automatically  on the Annuity Date. We may also terminate any optional Death
Benefit if necessary to comply with our interpretation of the Code and applicable regulations.

What are the charges for the optional Death Benefits?
We deduct a charge equal to 0.25% per year,  respectively,  if you elect the Highest  Anniversary  Value  Optional Death Benefit or the
Enhanced  Beneficiary  Protection  Optional Death  Benefit.  If you elect both optional  Death  Benefits,  the total charge is equal to
0.50% per year. We deduct the charge to compensate  American Skandia for providing  increased  insurance  protection under the optional
Death Benefit.  The additional annual charge is deducted daily against your Account Value allocated to the Sub-accounts.

Please refer to the section entitled "Tax Considerations" for additional considerations in relation to the optional Death Benefit.

AMERICAN SKANDIA'S ANNUITY REWARDS

What is the Annuity Rewards benefit?
The  Annuity  Rewards  benefit  offers  Owners the  ability to capture  any market  gains  since the Issue Date of their  Annuity as an
enhancement  to their current Death Benefit so their  Beneficiaries  will not receive less than the Annuity's  value as of the date the
Owner elects the benefit.  Under the Annuity  Rewards  benefit,  American  Skandia  guarantees  that the Death Benefit will not be less
than:

         your Account  Value in the variable  investment  options plus the Interim Value in any Fixed  Allocations  as of the effective
                  date of the Owner's election

         MINUS any proportional withdrawals* following the date of election

         PLUS any additional Purchase Payments applied to the Annuity following the date of election.

*    "Proportional  withdrawals"  are determined by calculating  the percentage of the Account Value that each  withdrawal  represented
     when withdrawn.  For example,  a withdrawal of 50% of your Account Value would be treated as a 50% reduction in the amount payable
     under the Death Benefit.

The Annuity  Rewards Death Benefit  enhancement  does not affect the basic Death Benefit  calculation  and any Optional  Death Benefits
available  under the Annuity.  If the Death Benefit  amount  payable  under your  Annuity's  basic Death Benefit or any Optional  Death
Benefits you purchase is greater than the enhanced  Death  Benefit under the Annuity  Rewards  benefit on the date the Death Benefit is
calculated, your Beneficiary will receive the higher amount.

Who is eligible for the Annuity Rewards benefit?
Owners can elect the Annuity  Rewards Death Benefit  enhancement  following the fourth (4th)  anniversary of the Annuity's  Issue Date.
However,  the election is subject to the  requirement  that their  Account  Value on the election  date is greater than the amount that
would be payable to their  Beneficiary  under the Death  Benefit  provided  under the Annuity as of the election  date  (including  any
amounts  payable  under the  Highest  Anniversary  Value  Death  Benefit).  If an Owner is  ineligible  when he or she  applies for the
optional  benefit,  the Owner can elect the  Annuity  Rewards  Death  Benefit  enhancement  on any  subsequent  date if they  otherwise
qualify.  The  election  must  occur  before  annuity  payments  begin.  An Owner can only  elect the  Annuity  Rewards  Death  Benefit
enhancement once.  There is no additional charge for electing the Annuity Rewards Death Benefit enhancement.

PAYMENT OF DEATH BENEFITS

Payment of Death Benefit to Beneficiary
Except in the case of a spousal Beneficiary, in the event of your death, the death benefit must be distributed:
|X|      as a lump sum amount at any time within five (5) years of the date of death; or
|X|      as a series  of  annuity  payments  not  extending  beyond  the life  expectancy  of the  Beneficiary  or over the life of the
         Beneficiary.  Payments under this option must begin within one year of the date of death.

Unless you have made an election  prior to death benefit  proceeds  becoming due, a Beneficiary  can elect to receive the Death Benefit
proceeds as a series of fixed annuity  payments  (annuity  payment options 1-4) or as a series of variable  annuity  payments  (annuity
payment options 1-3 or 5 and 6).  See the section entitled "What Types of Annuity Options are Available."

Spousal Beneficiary - Assumption of Annuity
You may name your  spouse as your  Beneficiary.  If you and your  spouse  own the  Annuity  jointly,  we assume  that the sole  primary
Beneficiary  will be the surviving  spouse unless you elect an  alternative  Beneficiary  designation.  Unless you elect an alternative
Beneficiary  designation,  the spouse  Beneficiary  may elect to assume  ownership of the Annuity  instead of taking the Death  Benefit
payment.  Any Death Benefit  (including any optional Death  Benefits) that would have been payable to the  Beneficiary  will become the
new Account  Value as of the date we receive due proof of death and any required  proof of a spousal  relationship.  As of the date the
assumption is  effective,  the  surviving  spouse will have all the rights and benefits that would be available  under the Annuity to a
new  purchaser of the same  attained  age. For purposes of  determining  any future Death  Benefit for the  surviving  spouse,  the new
Account  Value  will be  considered  as the  initial  Purchase  Payment.  No CDSC will apply to the new  Account  Value.  However,  any
additional  Purchase  Payments  applied after the date the  assumption is effective  will be subject to all  provisions of the Annuity,
including any CDSC that may apply to the additional Purchase Payments.

See the section  entitled  "Managing  Your  Annuity - Spousal  Contingent  Annuitant"  for a discussion  of the  treatment of a spousal
Contingent Annuitant in the case of the death of the Annuitant in an entity owned Annuity.

IRA Beneficiary Continuation Option
The Code  provides  for  alternative  death  benefit  payment  options  when an Annuity is used as an IRA,  403(b) or other  "qualified
investment"  that requires  Minimum  Distributions.  Upon the Owner's death under an IRA,  403(b) or other  "qualified  investment",  a
Beneficiary may generally elect to continue the Annuity and receive  Minimum  Distributions  under the Annuity instead of receiving the
death  benefit in a single  payment.  The available  payment  options will depend on whether the Owner died on or before the date he or
she was required to begin receiving Minimum Distributions under the Code and whether the Beneficiary is the surviving spouse.

|X|      If death occurs before the date Minimum  Distributions  must begin under the Code, the Death Benefit can be paid out in either
         a lump sum, within five years from the date of death,  or over the life or life  expectancy of the designated  Beneficiary (as
         long as  payments  begin  by  December  31st of the  year  following  the  year  of  death).  However,  if the  spouse  is the
         Beneficiary,  the Death Benefit can be paid out over the life or life  expectancy  of the spouse with such payments  beginning
         no earlier  than  December  31st of the year  following  the year of death or December  31st of the year in which the deceased
         would have reached age 70 1/2, which ever is later.

|X|      If death occurs after the date Minimum  Distributions  must begin under the Code,  the Death Benefit must be paid out at least
         as rapidly as under the method then in effect.

A Beneficiary  has the  flexibility to take out more each year than required under the Minimum  Distribution  rules.  Until  withdrawn,
amounts in an IRA,  403(b) or other  "qualified  investment"  continue  to be tax  deferred.  Amounts  withdrawn  each year,  including
amounts  that are  required  to be  withdrawn  under the Minimum  Distribution  rules,  are  subject to tax.  You may wish to consult a
professional  tax  advisor for tax advice as to your  particular  situation.  See the  section  entitled  "How are  Distributions  From
Qualified Contracts Taxed? - Minimum Distributions after age 70 1/2."

Upon election of this IRA Beneficiary Continuation option:

|X|      the Annuity contract will be continued in the Owner's name, for the benefit of the Beneficiary.
|X|      the Account Value will be equal to any Death Benefit  (including  any optional  Death Benefit) that would have been payable to
              the Beneficiary if they had taken a lump sum distribution.
|X|      the Beneficiary may request  transfers among  Sub-accounts,  subject to the same limitations and restrictions  that applied to
              the Owner.  NOTE: The Sub-accounts offered under the IRA Beneficiary Continuation option may be limited.
|X|      no additional Purchase Payments can be applied to the Annuity.
|X|      the basic Death Benefit and any optional Death Benefits elected by the Owner will no longer apply to the Beneficiary.
|X|      the Beneficiary can request a withdrawal of all or a portion of the Account Value at any time without application of a CDSC.
|X|      upon the death of the  Beneficiary,  any  remaining  Account  Value will be paid in a lump sum to the  person(s)  named by the
              Beneficiary.
|X|      all amounts in the Annuity must be paid out to the Beneficiary according to the Minimum Distribution rules described above.

Please contact  American  Skandia for additional  information on the  availability,  restrictions  and limitations that will apply to a
Beneficiary under the IRA Beneficiary Continuation option.

Are there any exceptions to these rules for paying the Death Benefit?
Yes, there are exceptions  that apply no matter how your Death Benefit is calculated.  There are exceptions to the Death Benefit if the
decedent  was not the Owner or Annuitant  as of the Issue Date and did not become the Owner or  Annuitant  due to the prior  Owner's or
Annuitant's  death.  Any Death Benefit  (including  either optional Death Benefit) that applies will be suspended for a two-year period
from the date he or she first became Owner or Annuitant.  After the two-year  suspension period is completed,  the Death Benefit is the
same as if this person had been an Owner or Annuitant on the Issue Date.

When do you determine the Death Benefit?
We determine the amount of the Death Benefit as of the date we receive "due proof of death",  any  instructions we require to determine
the method of payment and any other  written  representations  we require to determine  the proper  payment of the Death Benefit to all
Beneficiaries.  "Due proof of death" may include a certified  copy of a death  certificate,  a certified copy of a decree of a court of
competent  jurisdiction as to the finding of death or other  satisfactory  proof of death.  Upon our receipt of "due proof of death" we
automatically  transfer  the Death  Benefit to the AST Money Market  Sub-account  until we further  determine  the universe of eligible
Beneficiaries.  Once the universe of eligible  Beneficiaries  has been  determined  each eligible  Beneficiary  may allocate his or her
eligible share of the Death Benefit to the Sub-accounts according to our rules.

Each  Beneficiary  must make an election as to the method they wish to receive their portion of the Death  Benefit.  Absent an election
of a Death Benefit payment  method,  no Death Benefit can be paid to the  Beneficiary.  We may require  written  acknowledgment  of all
named  Beneficiaries  before we can pay the Death  Benefit.  During the period  from the date of death  until we receive  all  required
paper work, the amount of the Death Benefit may be subject to market fluctuations.

VALUING YOUR INVESTMENT

HOW IS MY ACCOUNT VALUE DETERMINED?
During the  accumulation  period,  the Annuity has an Account Value.  The Account Value is determined  separately for each  Sub-account
allocation and for each Fixed  Allocation.  The Account Value is the sum of the values of each Sub-account  allocation and the value of
each Fixed  Allocation.  The Account  Value does not reflect any CDSC that may apply to a withdrawal  or  surrender.  When  determining
the Account  Value on a day more than 30 days prior to a Fixed  Allocation's  Maturity  Date,  the Account Value may include any Market
Value Adjustment that would apply to a Fixed Allocation (if withdrawn or transferred) on that day.

WHAT IS THE SURRENDER VALUE OF MY ANNUITY?
The Surrender Value of your Annuity is the value  available to you on any day during the  accumulation  period.  The Surrender Value is
equal to your Account Value minus any CDSC, the Annual  Maintenance Fee and the charge for any optional  benefits.  The Surrender Value
will also include any Market Value Adjustment that may apply.

HOW AND WHEN DO YOU VALUE THE SUB-ACCOUNTS?
When you allocate Account Value to a Sub-account,  you are purchasing units of the Sub-account.  Each Sub-account  invests  exclusively
in shares of an underlying  Portfolio.  The value of the Units  fluctuates with the market  fluctuations  of the Portfolios.  The value
of the Units also  reflects the daily accrual for the Insurance  Charge and if you elected one or more optional  benefits  whose annual
charge is  deducted  daily,  the  additional  charge  made for such  benefits.  There may be  several  different  Unit  Prices for each
Sub-account  to reflect the  Insurance  Charge and the charges for any  optional  benefits.  The Unit Price for the Units you  purchase
will be based on the total  charges for the benefits  that apply to your Annuity.  See the section  entitled  "What Happens to My Units
When There is a Change in Daily  Asset-Based  Charges?"  for a detailed  discussion  of how Units are purchased and redeemed to reflect
changes in the daily charges that apply to your Annuity.

Each  Valuation  Day,  we  determine  the price for a Unit of each  Sub-account,  called the "Unit  Price."  The Unit Price is used for
determining  the  value of  transactions  involving  Units of the  Sub-accounts.  We  determine  the  number of Units  involved  in any
transaction by dividing the dollar value of the transaction by the Unit Price of the Sub-account as of the Valuation Day.

Example
Assume you allocate  $5,000 to a  Sub-account.  On the Valuation  Day you make the  allocation,  the Unit Price is $14.83.  Your $5,000
buys 337.154 Units of the  Sub-account.  Assume that later,  you wish to transfer $3,000 of your Account Value out of that  Sub-account
and into  another  Sub-account.  On the  Valuation  Day you  request  the  transfer,  the Unit Price of the  original  Sub-account  has
increased to $16.79.  To transfer  $3,000,  we sell 178.677  Units at the current Unit Price,  leaving you 158.477  Units.  We then buy
$3,000 of Units of the new Sub-account at the Unit Price of $17.83.  You would then have 168.255 Units of the new Sub-account.

HOW DO YOU VALUE FIXED ALLOCATIONS?
During the Guarantee  Period,  we use the concept of an Interim  Value.  The Interim Value can be calculated on any day and is equal to
the initial value  allocated to a Fixed  Allocation plus all interest  credited to a Fixed  Allocation as of the date  calculated.  The
Interim  Value does not include the impact of any Market  Value  Adjustment.  If you made any  transfers  or  withdrawals  from a Fixed
Allocation,  the Interim  Value will reflect the  withdrawal of those  amounts and any interest  credited to those amounts  before they
were  withdrawn.  To determine the Account Value of a Fixed  Allocation on any day other than its Maturity Date or within 30 days prior
to its Maturity Date, we multiply the Account Value of the Fixed Allocation times the Market Value Adjustment factor.

WHEN DO YOU PROCESS AND VALUE TRANSACTIONS?
American  Skandia is generally open to process  financial  transactions  on those days that the New York Stock Exchange  (NYSE) is open
for trading.  There may be  circumstances  where the NYSE does not open on a regularly  scheduled  date or time or closes at an earlier
time  than  scheduled  (normally  4:00 p.m.  EST).  Financial  transactions  requested  before  the  close of the NYSE  which  meet our
requirements  will be  processed  according  to the value next  determined  following  the close of  business.  Financial  transactions
requested  on a  non-business  day or after the close of the NYSE  will be  processed  based on the  value  next  computed  on the next
business day. There may be  circumstances  when the opening or closing time of the NYSE is different than other major stock  exchanges,
such as NASDAQ or the American Stock  Exchange.  Under such  circumstances,  the closing time of the NYSE will be used when valuing and
processing transactions.

There may be circumstances where the NYSE is open, however,  due to inclement weather,  natural disaster or other circumstances  beyond
our control,  our offices may be closed or our business  processing  capabilities may be restricted.  Under those  circumstances,  your
Account  Value may  fluctuate  based on  changes in the Unit  Values,  but you may not be able to  transfer  Account  Value,  or make a
purchase or redemption request.

The NYSE is closed on the following  nationally  recognized  holidays:  New Year's Day, Martin Luther King, Jr. Day,  Presidents'  Day,
Good Friday,  Memorial  Day,  Independence  Day,  Labor Day,  Thanksgiving,  and  Christmas.  On those  dates,  we will not process any
financial transactions involving purchase or redemption orders.

American Skandia will also not process financial transactions involving purchase or redemption orders or transfers on any day that:
|X|      trading on the NYSE is restricted;
|X|      an emergency exists making redemption or valuation of securities held in the separate account impractical; or
|X|      the SEC, by order, permits the suspension or postponement for the protection of security holders.

Initial Purchase  Payments:  We are required to allocate your initial  Purchase  Payment to the Sub-accounts  within two (2) days after
we receive all of our  requirements  to issue the  Annuity.  If we do not have all the required  information  to allow us to issue your
Annuity,  we may retain the Purchase Payment while we try to reach you or your  representative  to obtain all of our  requirements.  If
we are unable to obtain all of our required  information  within five (5) days,  we are required to return the Purchase  Payment to you
at that time,  unless you  specifically  consent to our retaining the Purchase Payment while we gather the required  information.  Once
we obtain the required  information,  we will invest the Purchase Payment and issue the Annuity within two (2) days.  During any period
that we are trying to obtain the required information, your money is not invested.

Additional  Purchase  Payments:  We will apply any  additional  Purchase  Payments on the  Valuation  Day that we receive the  Purchase
Payment with satisfactory allocation instructions.

Scheduled  Transactions:  "Scheduled"  transactions include transfers under a Dollar Cost Averaging,  rebalancing,  or asset allocation
program,  Systematic  Withdrawals,  Minimum  Distributions or annuity payments.  Scheduled  transactions are processed and valued as of
the date they are  scheduled,  unless the scheduled day is not a Valuation  Day. In that case,  the  transaction  will be processed and
valued on Valuation Day prior to the scheduled transaction date.

Unscheduled  Transactions:  "Unscheduled"  transactions include any other non-scheduled  transfers and requests for Partial Withdrawals
or Free  Withdrawals or Surrenders.  Unscheduled  transactions  are processed and valued as of the Valuation Day we receive the request
at our Office and have all of the required information.

Medically-related  Surrenders & Death Benefits:  Medically-related  surrender  requests and Death Benefit claims require our review and
evaluation  before  processing.  We price such  transactions  as of the date we receive at our Office all supporting  documentation  we
require for such transactions and that are satisfactory to us.

Transactions in ProFunds VP Sub-accounts:  Generally,  purchase or redemption  orders or transfer requests must be received by us by no
later than the close of the NYSE to be processed on the current  Valuation Day.  However,  any purchase or redemption order or transfer
request  involving the ProFunds VP  Sub-accounts  must be received by us no later than one hour prior to any  announced  closing of the
applicable  securities  exchange  (generally,  3:00 p.m. Eastern time) to be processed on the current Valuation Day. The "cut-off" time
for such  financial  transactions  involving  a ProFunds VP  Sub-account  will be  extended  to1/2hour prior to any  announced  closing
(generally,   3:30  p.m.  Eastern  time)  for  transactions  submitted  electronically  through  American  Skandia's  Internet  website
(www.americanskandia.prudential.com).  You cannot  request a transaction  involving  the  purchase,  redemption or transfer of units in
one of the ProFunds VP Sub-account between the applicable  "cut-off" time and 4:00 p.m.  Transactions  received after 4:00 p.m. will be
treated as received by us on the next Valuation Day.

WHAT HAPPENS TO MY UNITS WHEN THERE IS A CHANGE IN DAILY ASSET-BASED CHARGES?

Termination  of Optional  Benefits:  Except for the  Guaranteed  Minimum  Income  Benefit  which cannot be terminated by the owner once
elected,  if you terminate any other optional  benefit,  we will no longer deduct the charge we apply to purchase the optional benefit.
On the date the charge no longer applies,  your Annuity will become subject to a different daily  asset-based  charge.  We will process
a transaction  where your Account  Value  allocated to the  Sub-accounts  will be used to purchase new Units of the  Sub-accounts  that
reflect the  Insurance  Charge and any  optional  benefit or program  still  elected,  but not the charge for the  optional  benefit or
program that you  terminated.  The number of Units  attributed to your Annuity will be decreased and the Unit Price of each unit of the
Sub-accounts  in which you  invested  will be  increased.  The  adjustment  in the number of Units and Unit Price will not affect  your
Account  Value.  Beginning on that date,  your Account Value will be determined  based on the change in the value of Units that reflect
the Insurance Charge and any other optional benefits that you have elected.

TAX CONSIDERATIONS

WHAT ARE SOME OF THE FEDERAL TAX CONSIDERATIONS OF THIS ANNUITY?
Following  is a brief  summary of some of the Federal tax  considerations  relating to this  Annuity.  However,  since the tax laws are
complex and tax  consequences are affected by your individual  circumstances,  this summary of our  interpretation  of the relevant tax
laws is not intended to be fully  comprehensive  nor is it intended as tax advice.  Therefore,  you may wish to consult a  professional
tax advisor for tax advice as to your particular situation.

HOW ARE AMERICAN SKANDIA AND THE SEPARATE ACCOUNTS TAXED?
The Separate  Accounts are taxed as part of American  Skandia.  American  Skandia is taxed as a life  insurance  company  under Part I,
subchapter L of the Code.  No taxes are due on interest,  dividends and  short-term  or long-term  capital gains earned by the Separate
Accounts with respect to the Annuities.

IN GENERAL, HOW ARE ANNUITIES TAXED?
Section 72 of the Code governs the taxation of annuities in general.  Taxation of the Annuity will depend in large part on:

1.       whether the Annuity is used by:
|X|      a qualified  pension plan,  profit sharing plan or other retirement  arrangement that is eligible for special  treatment under
         the Code (for purposes of this discussion, a "Qualified Contract"); or
|X|      an individual or a corporation, trust or partnership (a "Non-qualified Contract"); and

2.       whether the Owner is:
|X|      an individual person or persons; or
|X|      an entity including a corporation, trust or partnership.

Individual  Ownership:  If one or more  individuals own an Annuity,  the Owner of the Annuity is generally not taxed on any increase in
the  value of the  Annuity  until an  amount is  received  (a  "distribution").  This is  commonly  referred  to as "tax  deferral".  A
distribution  can be in the form of a lump sum payment  including  payment of a Death Benefit,  or in annuity payments under one of the
annuity payment options.  Certain other transactions may qualify as a distribution and be subject to taxation.

Entity  Ownership:  If the  Annuity is owned by an entity and is not a Qualified  Contract,  generally  the Owner of the  Annuity  must
currently  include any increase in the value of the Annuity during a tax year in its gross income.  An exception from current  taxation
applies for annuities  held by an employer with respect to a terminated  tax-qualified  retirement  plan, a trust holding an annuity as
an agent for a natural person,  or by a decedent's  estate by reason of the death of the decedent.  A tax-exempt entity for Federal tax
purposes may not be subject to income tax as a result of this provision.

HOW ARE DISTRIBUTIONS TAXED?
Distributions from an Annuity are taxed as ordinary income and not as capital gains.

Distributions  Before  Annuitization:  Distributions  received before annuity payments begin are generally treated as coming first from
"income on the contract" and then as a return of the  "investment  in the  contract".  The amount of any  distribution  that is treated
as receipt of "income on the  contract" is  includible  in the  taxpayer's  gross  income and taxable in the year it is  received.  The
amount of any distribution treated as a return of the "investment in the contract" is not includible in gross income.

|X|      "Income on the contract" is calculated by  subtracting  the taxpayer's  "investment in the contract" from the aggregate  value
     of all "related contracts" (discussed below).
|X|      "Investment  in the  contract"  is  equal  to  total  purchase  payments  for  all  "related  contracts"  minus  any  previous
     distributions  or  portions  of such  distributions  from such  "related  contracts"  that were not  includible  in gross  income.
     "Investment  in the contract" may be affected by whether an annuity or any "related  contract" was purchased as part of a tax-free
     exchange of life insurance,  endowment,  or annuity contracts under Section 1035 of the Code. The "investment in the contract" for
     a Qualified Contract will be considered zero for tax reporting purposes.

Distributions  After  Annuitization:  A portion of each  annuity  payment  received  on or after the  Annuity  Date will  generally  be
taxable.  The taxable  portion of each annuity  payment is determined by a formula which  establishes the ratio that the "investment in
the contract"  bears to the total value of annuity  payments to be made.  This is called the  "exclusion  ratio." The investment in the
contract is excluded from gross income.  Any portion of an annuity  payment  received that exceeds the exclusion ratio will be entirely
includible in gross income.  The formula for  determining  the exclusion  ratio differs  between fixed and variable  annuity  payments.
When annuity  payments  cease because of the death of the person upon whose life  payments are based and, as of the date of death,  the
amount of annuity  payments  excluded from taxable income by the exclusion ratio does not exceed the "investment in the contract," then
the remaining portion of unrecovered investment may be allowed as a deduction on the decedent's final income tax return.

Penalty  Tax on  Distributions:  Generally,  any  distribution  from an  annuity  not used in  conjunction  with a  Qualified  Contract
(Qualified  Contracts  are  discussed  below) is  subject to a penalty  equal to 10% of the amount  includible  in gross  income.  This
penalty does not apply to certain distributions, including:
|X|      Distributions made on or after the taxpayer has attained age 591/2;
|X|      Distributions made on or after the death of the contract owner, or, if the owner is an entity, the death of the annuitant;
|X|      Distributions attributable to the taxpayer's becoming disabled within the meaning of Code section 72(m)(7);
|X|      Distributions  which are part of a series of  substantially  equal periodic  payments for the life (or life expectancy) of the
     taxpayer or the joint lives (or joint life expectancies) of the taxpayer and the taxpayer's designated beneficiary;
|X|      Distributions of amounts which are treated as "investments in the contract" made prior to August 14, 1982;
|X|      Payments under an immediate annuity as defined in the Code;
|X|      Distributions under a qualified funding asset under Code Section 130(d); or
|X|      Distributions  from an annuity  purchased by an employer on the  termination  of a qualified  pension plan that is held by the
     employer until the employee separates from service.

Special  rules  applicable to "related  contracts":  Contracts  issued by the same insurer to the same  contract  owner within the same
calendar year (other than certain contracts owned in connection with a tax-qualified  retirement  arrangement) are to be treated as one
annuity  contract  when  determining  the  taxation of  distributions  before  annuitization.  We refer to these  contracts as "related
contracts."  In  situations  involving  related  contracts we believe that the values under such  contracts  and the  investment in the
contracts will be added together to determine the proper taxation of a distribution  from any one contract  described under the section
"Distributions before  Annuitization."  Generally,  distributions will be treated as coming first from income on the contract until all
of the income on all such  related  contracts is  withdrawn,  and then as a return of the  investment  in the  contract.  There is some
uncertainty  regarding the manner in which the Internal  Revenue  Service would view related  contracts  when one or more contracts are
immediate  annuities or are contracts that have been annuitized.  The Internal Revenue Service has not issued guidance  clarifying this
issue as of the date of this Prospectus.  You are particularly cautioned to seek advice from your own tax advisor on this matter.

Special concerns regarding  "substantially equal periodic payments":  (also known as "72(t)" or "72(q)" distributions) Any modification
to a program of distributions  which are part of a series of substantially  equal periodic  payments that occur before the later of the
taxpayer  reaching age 59 1/2or five (5) years from the first of such  payments will result in the  requirement  to pay the 10% premature
distribution  penalty that would have been due had the payments  been treated as subject to the 10% premature  distribution  penalty in
the years received,  plus interest.  This does not apply when the  modification is by reason of death or disability.  American  Skandia
does not currently support a section 72(q) program.

Special concerns  regarding  immediate  annuities:  The Internal Revenue Service has ruled that the immediate  annuity exception to the
10% penalty  described above under "Penalty Tax on Distributions"  for  "non-qualified"  immediate  annuities as defined under the Code
may not apply to annuity payments under a contract  recognized as an immediate  annuity under state insurance law obtained  pursuant to
an exchange of a contract if: (a) purchase  payments for the  exchanged  contract were  contributed  or deemed to be  contributed  more
than one year prior to the annuity  starting  date under the  immediate  annuity;  and (b) the  annuity  payments  under the  immediate
annuity do not meet the requirements of any other exception to the 10% penalty.

Special rules in relation to tax-free  exchanges under Section 1035:  Section 1035 of the Code permits certain tax-free  exchanges of a
life  insurance,  annuity or  endowment  contract  for an annuity.  If an annuity is  purchased  through a tax-free  exchange of a life
insurance,  annuity or endowment  contract that was purchased  prior to August 14, 1982, then any  distributions  other than as annuity
payments will be considered to come:
|X|      First, from the amount of "investment in the contract" made prior to August 14, 1982 and exchanged into the annuity;
|X|      Then,  from any  "income on the  contract"  that is  attributable  to the  purchase  payments  made  prior to August 14,  1982
       (including income on such original purchase payments after the exchange);
|X|      Then, from any remaining "income on the contract"; and
|X|      Lastly, from the amount of any "investment in the contract" made after August 13, 1982.

Therefore,  to the extent a  distribution  is equal to or less than the  remaining  investment in the contract made prior to August 14,
1982,  such  amounts are not  included  in taxable  income.  Further,  distributions  received  that are  considered  to be a return of
investment on the contract from purchase  payments  made prior to August 14, 1982,  such  distributions  are not subject to the 10% tax
penalty.  In all other respects,  the general  provisions of the Code apply to distributions from annuities obtained as part of such an
exchange.

Partial  surrenders may be treated in the same way as tax-free 1035 exchanges of entire contracts,  therefore avoiding current taxation
of any gains in the  contract as well as the 10% IRS tax penalty on pre-age 59 1/2withdrawals.  The IRS has  reserved the right to treat
transactions it considers  abusive as ineligible for this favorable partial 1035 exchange  treatment.  We do not know what transactions
may be  considered  abusive.  For example,  we do not know how the IRS may view early  withdrawals  or  annuitizations  after a partial
exchange.  As of the date of this  prospectus,  we will  treat a partial  surrender  of this type  involving  a  non-qualified  annuity
contract as a "tax-free"  exchange for future tax  reporting  purposes,  except to the extent that we, as a reporting  and  withholding
agent,  believe that we would be expected to deem the transaction to be abusive.  However,  some insurance  companies may not recognize
these partial  surrenders as tax-free  exchanges and may report them as taxable  distributions to the extent of any gain distributed as
well as  subjecting  the taxable  portion of the  distribution  to the 10% IRS early  distribution  penalty.  We  strongly  urge you to
discuss any transaction of this type with your tax advisor before proceeding with the transaction.

There is no guidance from the Internal  Revenue  Service as to whether a partial  exchange from a life  insurance  contract is eligible
for  non-recognition  treatment  under  Section 1035 of the Code. We will  continue to report a partial  surrender of a life  insurance
policy as subject to current  taxation to the extent of any gain. In addition,  please be cautioned that no specific  guidance has been
provided as to the impact of such a transaction on the remaining life insurance  policy,  particularly as to the subsequent  methods to
be used to test for compliance  under the Code for both the  definition of life  insurance and the  definition of a modified  endowment
contract.

Special  Considerations  for  Purchasers  of the  Enhanced  Beneficiary  Protection  Optional  Death  Benefit:  As of the  date of this
Prospectus,  it is our understanding  that the charges related to the optional Death Benefit are not subject to current taxation and we
will not report them as such.  However,  the IRS could take the position  that these charges  should be treated as partial  withdrawals
subject  to  current  taxation  to the extent of any gain and,  if  applicable,  the 10% tax  penalty.  We reserve  the right to report
charges for the optional Death Benefit as partial  withdrawals if we, as a reporting and  withholding  agent,  believe that we would be
expected to report them as such.

WHAT TAX CONSIDERATIONS ARE THERE FOR TAX-QUALIFIED RETIREMENT PLANS OR QUALIFIED CONTRACTS?
An annuity may be suitable as a funding  vehicle for various  types of  tax-qualified  retirement  plans.  We have  provided  summaries
below of the types of tax-qualified  retirement plans with which we may issue an Annuity.  These summaries provide general  information
about the tax rules and are not  intended to be complete  discussions.  The tax rules  regarding  qualified  plans are  complex.  These
rules may include  limitations on contributions and restrictions on distributions,  including  additional taxation of distributions and
additional  penalties.  The terms and conditions of the  tax-qualified  retirement plan may impose other  limitations and  restrictions
that are in addition to the terms of the  Annuity.  The  application  of these rules  depends on  individual  facts and  circumstances.
Before  purchasing an Annuity for use in a qualified  plan,  you should obtain  competent tax advice,  both as to the tax treatment and
suitability  of such an  investment.  American  Skandia  does not offer all of its  annuities  to all of these  types of  tax-qualified
retirement plans.

Economic  Growth and Tax Relief  Reconciliation  Act  (EGTRRA):  Certain  states do not conform to the pension  provisions  included in
EGTRRA.  We  recommend  that you  consult  with your tax advisor to  determine  the status of your  state's  statutes as they relate to
EGTRRA and your tax qualified retirement plan.

Corporate  Pension  and  Profit-sharing  Plans:  Annuities  may be used to fund  employee  benefits  of various  corporate  pension and
profit-sharing  plans  established by corporate  employers under Section 401(a) of the Code including  401(k) plans.  Contributions  to
such plans are not taxable to the employee  until  distributions  are made from the retirement  plan.  The Code imposes  limitations on
the  amount  that may be  contributed  and the  timing of  distributions.  The tax  treatment  of  distributions  is subject to special
provisions of the Code,  and also depends on the design of the specific  retirement  plan.  There are also special  requirements  as to
participation, nondiscrimination, vesting and nonforfeitability of interests.

H.R.  10 Plans:  Annuities  may also be used to fund  benefits  of  retirement  plans  established  by  self-employed  individuals  for
themselves  and their  employees.  These are commonly  known as "H.R.  10 Plans" or "Keogh  Plans".  These plans are subject to most of
the same types of limitations and requirements as retirement  plans  established by corporations.  However,  the exact  limitations and
requirements may differ from those for corporate plans.

Tax Sheltered  Annuities:  Under Section 403(b) of the Code, a tax sheltered annuity ("TSA") is a contract into which contributions may
be made by certain  qualifying  employers  such as public schools and certain  charitable,  educational  and  scientific  organizations
specified  in Section  501(c)(3)  for the  benefit of their  employees.  Such  contributions  are not  taxable  to the  employee  until
distributions  are made from the TSA.  The Code  imposes  limits  on  contributions,  transfers  and  distributions.  Nondiscrimination
requirements also apply.

Section 457 Plans:  Under Section 457 of the Code,  deferred  compensation  plans  established  by  governmental  and certain other tax
exempt employers for their employees may invest in annuity  contracts.  The Code limits  contributions and  distributions,  and imposes
eligibility  requirements as well.  Contributions  are not taxable to employees until distributed from the plan.  However,  plan assets
remain the  property of the  employer  and are subject to the claims of the  employer's  general  creditors  until such assets are made
available to participants or their beneficiaries.

Individual  Retirement  Arrangements  or "IRAs":  Section  408 of the Code  allows  eligible  individuals  to  maintain  an  individual
retirement  account or individual  retirement  annuity ("IRA").  IRAs are subject to limitations on the amount that may be contributed,
the  contributions  that may be deducted  from  taxable  income,  the persons who may be eligible to establish an IRA and the time when
distributions  must  commence.  Further,  an Annuity may be  established  with  "roll-over"  distributions  from certain  tax-qualified
retirement plans and maintain the tax-deferred status of these amounts.

Roth  IRAs:  A form of IRA is also  available  called  a "Roth  IRA".  Contributions  to a Roth  IRA are not tax  deductible.  However,
distributions  from a Roth IRA are free from  Federal  income  taxes and are not  subject to the 10%  penalty tax if five (5) tax years
have passed since the first  contribution  was made or any conversion from a traditional IRA was made and the  distribution is made (a)
once the taxpayer is age 59 1/2or older,  (b) upon the death or disability of the taxpayer,  or (c) for qualified  first-time  home buyer
expenses,  subject to certain  limitations.  Distributions  from a Roth IRA that are not  "qualified" as described above may be subject
to Federal income and penalty taxes.

Purchasers  of IRAs  and  Roth  IRAs  will  receive  a  special  disclosure  document,  which  describes  limitations  on  eligibility,
contributions,  transferability  and distributions.  It also describes the conditions under which distributions from IRAs and qualified
plans may be rolled over or transferred into an IRA or another  qualified plan, on a tax-deferred  basis and the conditions under which
distributions from traditional IRAs may be rolled over to, or the traditional IRA itself may be converted into, a Roth IRA.

SEP IRAs:  Eligible  employers  that  meet  specified  criteria  may  establish  Simplified  Employee  Pensions  or SEP IRAs.  Employer
contributions  that may be made to employee  SEP IRAs are larger than the amounts  that may be  contributed  to other IRAs,  and may be
deductible to the employer.

HOW ARE DISTRIBUTIONS FROM QUALIFIED CONTRACTS TAXED?
Distributions  from  Qualified  Contracts  are  generally  taxed under  Section 72 of the Code.  Under these  rules,  a portion of each
distribution  may be  excludable  from income.  The  excludable  amount is the  proportion  of a  distribution  representing  after-tax
contributions.  Generally,  a 10% penalty tax applies to the taxable portion of a distribution from a Qualified  Contract made prior to
age 59 1/2.  However, the 10% penalty tax does not apply when the distribution:
|X|      is part of a properly executed transfer to another IRA or another eligible qualified account;
|X|      is subsequent to the death or  disability  of the taxpayer (for this purpose  disability is as defined in Section  72(m)(7) of
     the Code);
|X|      is part of a series of substantially  equal periodic  payments to be paid not less frequently than annually for the taxpayer's
     life or life expectancy or for the joint lives or life expectancies of the taxpayer and a designated beneficiary;
|X|      is subsequent to a separation from service after the taxpayer attains age 55*;
|X|      does not exceed the employee's allowable deduction in that tax year for medical care;
|X|      is made to an alternate payee pursuant to a qualified domestic relations order*;
|X|      is made pursuant to an IRS levy;
|X|      is made to pay qualified acquisition costs for a first time home purchase (IRA only);
|X|      is made to pay qualified higher education expenses (IRA only); and
|X|      is not more than the cost of your medical insurance (IRA only).

The exceptions above which are followed by an asterisk (*) do not apply to IRAs.  Certain other exceptions may be available.

Minimum  Distributions  after age 70 1/2: A participant's  interest in a Qualified Contract must generally be distributed,  or begin to be
distributed, by the "required beginning date".  This is April 1st of the calendar year following the later of:
|X|      the calendar year in which the individual attains age 70 1/2; or
|X|      the calendar year in which the individual  retires from service with the employer  sponsoring the plan. The retirement  option
      is not available to IRAs.

The IRS has released Treasury  regulations  containing new Minimum Distribution rules. For Minimum  Distributions  required in 2003 and
later,  individuals  are required to use the rules under the 2002 Final  Regulations.  The 2002 Final  Regulations  contain a provision
which  could  increase  the amount of  minimum  distributions  required  for  certain  individuals.  Under the 2002 Final  Regulations,
individuals  are required to include in their annuity  contract  value the actuarial  value of any other benefits that will be provided
under the annuity.  We and other annuity  providers are currently  seeking  clarification of this new rule. You should consult your tax
adviser to determine the impact of this rule on your Minimum Distributions.

Under the new Minimum  Distribution  rules, a uniform life expectancy  table will be utilized by all  participants  except those with a
spouse who is more than ten (10) years younger than the  participant.  In that case,  the new rules permit the  participant  to utilize
the  actual  life  expectancies  of the  participant  and the  spouse.  In most  cases,  the  beneficiary  may be  changed  during  the
participant's  lifetime with no affect on the Minimum  Distributions.  At death, the designated  Beneficiary may generally take Minimum
Distributions over his/her life expectancy or in a lump sum.

If the amount  distributed is less than the minimum required  distribution for the year, the participant is subject to a 50% tax on the
amount  that was not  properly  distributed.  Because of the many  recent  changes  to the  Minimum  Distribution  rules,  we  strongly
encourage you to consult with your tax advisor for more detailed information.

GENERAL TAX CONSIDERATIONS

Diversification:  Section 817(h) of the Code provides that a variable annuity  contract,  in order to qualify as an annuity,  must have
an "adequately  diversified"  segregated  asset account  (including  investments  in a mutual fund by the  segregated  asset account of
insurance  companies).  If the  diversification  requirements  under the Code are not met and the annuity is not treated as an annuity,
the taxpayer  will be subject to income tax on the annual gain in the contract.  The Treasury  Department's  regulations  prescribe the
diversification  requirements for variable annuity contracts.  We expect the underlying mutual fund portfolios to comply with the terms
of these regulations.

Transfers Between Investment  Options:  Transfers between investment options are not subject to taxation.  The Treasury  Department may
promulgate  guidelines  under which a variable  annuity will not be treated as an annuity for tax  purposes if persons  with  ownership
rights have  excessive  control over the  investments  underlying  such variable  annuity.  Such  guidelines may or may not address the
number of investment options or the number of transfers between  investment  options offered under a variable annuity.  It is not known
whether such  guidelines,  if in fact  promulgated,  would have  retroactive  effect.  It is also not known what effect,  if any,  such
guidelines may have on transfers  between the investment  options of the Annuity offered pursuant to this Prospectus.  We will take any
action, including modifications to your Annuity or the Sub-accounts, required to comply with such guidelines if promulgated.

Federal Income Tax  Withholding:  Section 3405 of the Code provides for Federal income tax withholding on the portion of a distribution
which is  includible  in the gross  income of the  recipient.  Amounts  to be  withheld  depend  upon the  nature of the  distribution.
However,  under most  circumstances  a  recipient  may elect not to have income  taxes  withheld  or have  income  taxes  withheld at a
different rate by filing a completed election form with us.

Certain distributions,  known as eligible rollover  distributions,  from Qualified Contracts,  are subject to automatic 20% withholding
for Federal income taxes.  The following distributions are not eligible rollover distributions and not subject to 20% withholding:
|X|      any portion of a distribution paid as a Minimum Distribution;
|X|      direct transfers to the trustee of another retirement plan;
|X|      distributions from an individual retirement account or individual retirement annuity;
|X|      distributions  made as  substantially  equal  periodic  payments for the life or life  expectancy  of the  participant  in the
     retirement plan or the life or life expectancy of such participant and his or her designated beneficiary under such plan;
|X|      distributions that are part of a series of substantial periodic payments pursuant to Section 72(q) or 72(t) of the Code; and
|X|      certain other distributions where automatic 20% withholding may not apply.

Loans,  Assignments and Pledges:  Any amount received directly or indirectly as a loan from, or any assignment or pledge of any portion
of the value  of, an  annuity  before  annuity  payments  have  begun is  treated  as a  distribution  subject  to  taxation  under the
distribution  rules set forth above.  Any gain in an annuity on or after the  assignment or pledge of an entire  annuity and while such
assignment  or pledge  remains in effect is treated as "income on the  contract" in the year in which it is earned.  For  annuities not
issued as Qualified  Contracts,  the cost basis of the annuity is increased by the amount of any  assignment  or pledge  includible  in
gross  income.  The cost basis is not affected by any  repayment of any loan for which the annuity is  collateral  or by payment of any
interest thereon.

Gifts:  The gift of an annuity to someone other than the spouse of the owner (or former spouse  incident to a divorce) is treated,  for
income tax purposes, as a distribution.

Estate and Gift Tax  Considerations:  You should obtain competent tax advice with respect to possible federal and state estate and gift
tax consequences flowing from the ownership and transfer of annuities.

Generation-Skipping  Transfers:  Under the Code certain taxes may be due when all or part of an annuity is  transferred  to, or a death
benefit is paid to, an  individual  two or more  generations  younger than the contract  holder.  These  generation-skipping  transfers
generally  include those subject to federal estate or gift tax rules.  There is an aggregate $1.1 million  exemption from taxes for all
such  transfers.  We may be required to determine  whether a transaction  is a direct skip as defined in the Code and the amount of the
resulting  tax. We will  deduct  from your  Annuity or from any  applicable  payment  treated as a direct skip any amount of tax we are
required to pay.

Considerations for Contingent  Annuitants:  There may be adverse tax consequences if a contingent  annuitant succeeds an annuitant when
the Annuity is owned by a trust that is neither tax exempt nor qualifies for preferred  treatment  under certain  sections of the Code.
In general,  the Code is designed to prevent indefinite  deferral of tax.  Continuing the benefit of tax deferral by naming one or more
contingent  annuitants when the Annuity is owned by a non-qualified  trust might be deemed an attempt to extend the tax deferral for an
indefinite  period.  Therefore,  adverse tax treatment may depend on the terms of the trust, who is named as contingent  annuitant,  as
well as the  particular  facts and  circumstances.  You should  consult your tax advisor  before  naming a contingent  annuitant if you
expect to use an Annuity in such a fashion.

GENERAL INFORMATION

HOW WILL I RECEIVE STATEMENTS AND REPORTS?
We send any  statements and reports  required by applicable  law or regulation to you at your last known address of record.  You should
therefore  give us prompt  notice of any address  change.  We reserve  the right,  to the extent  permitted  by law and subject to your
prior consent, to provide any prospectus, prospectus supplements,  confirmations,  statements and reports required by applicable law or
regulation to you through our Internet Website at  http://www.americanskandia.prudential.com  or any other electronic means,  including
diskettes or CD ROMs.  We send a  confirmation  statement to you each time a  transaction  is made  affecting  Account  Value,  such as
making additional Purchase Payments,  transfers,  exchanges or withdrawals.  We also send quarterly  statements  detailing the activity
affecting your Annuity during the calendar quarter.  We may confirm regularly  scheduled  transactions,  such as the Annual Maintenance
Fee, systematic withdrawals (including 72(t) payments and required minimum distributions),  bank drafting,  dollar cost averaging,  and
static  rebalancing,  in quarterly  statements  instead of confirming  them  immediately.  You should review the  information  in these
statements carefully. You may request additional reports.  We reserve the right to charge up to $50 for each such additional report.

Any errors or  corrections on  transactions  for your Annuity must be reported to us at our Office as soon as possible to assure proper
accounting to your Annuity.  For  transactions  that are confirmed  immediately,  we assume all  transactions  are accurate  unless you
notify us  otherwise  within 30 days from the date you receive the  confirmation.  For  transactions  that are first  confirmed  on the
quarterly  statement,  we assume all  transactions  are  accurate  unless you  notify us within 30 days from the date you  receive  the
quarterly  statement.  All  transactions  confirmed  immediately or by quarterly  statement are deemed  conclusive after the applicable
30-day  period.  We may also send an annual  report  and a  semi-annual  report  containing  applicable  financial  statements  for the
Separate  Account and the Portfolios,  as of December 31 and June 30,  respectively,  to Owners or, with your prior consent,  make such
documents available electronically through our Internet Website or other electronic means.

WHO IS AMERICAN SKANDIA?
American  Skandia Life Assurance  Corporation  ("American  Skandia") is a stock life insurance  company  domiciled in Connecticut  with
licenses in all 50 states,  the  District of Columbia  and Puerto  Rico.  American  Skandia is a  wholly-owned  subsidiary  of American
Skandia,  Inc.  ("ASI").  American  Skandia markets its products to  broker-dealers  and financial  planners  through an internal field
marketing staff. In addition,  American Skandia markets through and in conjunction with financial  institutions  such as banks that are
permitted directly, or through affiliates, to sell annuities.

American Skandia is in the business of issuing annuity and life insurance  products.  American  Skandia  currently offers the following
products:  (a) flexible  premium deferred  annuities and single premium fixed deferred  annuities that are registered with the SEC; (b)
certain  other fixed  deferred  annuities  that are not  registered  with the SEC;  (c) both fixed and  variable  immediate  adjustable
annuities; and (d) a single premium variable life insurance policy that is registered with the SEC.

Effective May 1, 2003,  Skandia U.S. Inc.,  the sole  shareholder  of ASI,  which is the parent of American  Skandia,  was purchased by
Prudential  Financial,  Inc.  Prudential  Financial  is a New  Jersey  insurance  holding  company  whose  subsidiary  companies  serve
individual and  institutional  customers  worldwide and include The Prudential  Insurance  Company of America,  one of the largest life
insurance  companies in the U.S.  These  companies  offer a variety of products and services,  including life  insurance,  property and
casualty insurance, mutual funds, annuities, pension and retirement related services and administration,  asset management,  securities
brokerage, banking and trust services, real estate brokerage franchises, and relocation services.

No company other than  American  Skandia has any legal  responsibility  to pay amounts that it owes under its annuity and variable life
insurance  contracts.  However,  following the closing of the acquisition,  Prudential  Financial will exercise  significant  influence
over the operations and capital structure of American Skandia.

WHAT ARE SEPARATE ACCOUNTS?
The  separate  accounts are where  American  Skandia sets aside and invests the assets of some of our  annuities.  In the  accumulation
period,  assets  supporting  Account Values of the Annuities are held in a separate account  established under the laws of the State of
Connecticut.  We are the legal  owner of assets in the  separate  accounts.  In the payout  period,  assets  supporting  fixed  annuity
payments and any adjustable  annuity payments we make available are held in our general  account.  Assets  supporting  variable annuity
payment options may be invested in our separate  accounts.  Income,  gains and losses from assets allocated to these separate  accounts
are credited to or charged against each such separate  account without regard to other income,  gains or losses of American  Skandia or
of any other of our separate  accounts.  These assets may only be charged with  liabilities  which arise from the  Annuities  issued by
American  Skandia.  The amount of our obligation in relation to allocations to the Sub-accounts is based on the investment  performance
of such Sub-accounts.  However, the obligations themselves are our general corporate obligations.

Separate Account B
During the accumulation  period, the assets supporting  obligations based on allocations to the variable investment options are held in
Sub-accounts of American  Skandia Life Assurance  Corporation  Variable  Account B, also referred to as "Separate  Account B". Separate
Account B was  established  by us pursuant to  Connecticut  law on November  25,  1987.  Separate  Account B also holds assets of other
annuities issued by us with values and benefits that vary according to the investment performance of Separate Account B.

Separate  Account B  consists  of  multiple  Sub-accounts.  Each  Sub-account  invests  only in a single  mutual  fund or  mutual  fund
portfolio.  The name of each Sub-account generally  corresponds to the name of the underlying  Portfolio.  Each Sub-account in Separate
Account B may have several  different  Unit Prices to reflect the Insurance  Charge and the charges for any optional  benefits that are
offered under this Annuity and other  annuities  issued by us through  Separate  Account B. Separate  Account B is registered  with the
SEC under the Investment  Company Act of 1940  ("Investment  Company Act") as a unit  investment  trust,  which is a type of investment
company.  The SEC does not supervise investment policies, management or practices of Separate Account B.

Prior to November 18, 2002,  Separate  Account B was organized as a single  separate  account with six different  Sub-account  classes,
each of which was registered as a distinct unit investment  trust under the Investment  Company Act.  Effective  November 18, 2002 each
Sub-account  class of Separate  Account B was  consolidated  into the unit  investment  trust  formerly  named  American  Skandia  Life
Assurance  Corporation  Variable  Account B (Class 1  Sub-accounts),  which was  subsequently  renamed  American Skandia Life Assurance
Corporation  Variable  Account B. Each  Sub-account of Separate Account B has multiple Unit Prices to reflect the daily charge deducted
for each  combination  of the applicable  Insurance  Charge,  Distribution  Charge (when  applicable)  and the charge for each optional
benefit offered under Annuity  contracts funded through  Separate  Account B. The  consolidation of Separate Account B had no impact on
Annuity Owners.

We reserve the right to make changes to the  Sub-accounts  available  under the Annuity as we determine  appropriate.  We may offer new
Sub-accounts,  eliminate  Sub-accounts,  or combine  Sub-accounts at our sole discretion.  We may also close Sub-accounts to additional
Purchase  Payments on existing  Annuity  contracts or close  Sub-accounts  for Annuities  purchased on or after specified dates. We may
also substitute an underlying  mutual fund or portfolio of an underlying  mutual fund for another  underlying  mutual fund or portfolio
of an  underlying  mutual fund,  subject to our receipt of any  exemptive  relief that we are  required to obtain under the  Investment
Company Act.  We will notify Owners of changes we make to the Sub-accounts available under the Annuity.

Values and benefits based on allocations to the Sub-accounts  will vary with the investment  performance of the underlying mutual funds
or fund  portfolios,  as applicable.  We do not guarantee the investment  results of any  Sub-account.  Your Account Value allocated to
the  Sub-accounts  may increase or decrease.  You bear the entire  investment  risk.  There is no assurance  that the Account  Value of
your Annuity will equal or be greater than the total of the Purchase Payments you make to us.

Separate Account D
During the  accumulation  period,  assets  supporting our  obligations  based on Fixed  Allocations  are held in American  Skandia Life
Assurance  Corporation  Separate Account D, also referred to as "Separate  Account D". Such obligations are based on the fixed interest
rates we credit to Fixed  Allocations  and the terms of the Annuities.  These  obligations do not depend on the investment  performance
of the assets in Separate Account D.  Separate Account D was established by us pursuant to Connecticut law.

There are no units in  Separate  Account  D. The Fixed  Allocations  are  guaranteed  by our  general  account.  An  Annuity  Owner who
allocates  a portion of their  Account  Value to  Separate  Account D does not  participate  in the  investment  gain or loss on assets
maintained  in  Separate  Account  D. Such gain or loss  accrues  solely  to us.  We  retain  the risk that the value of the  assets in
Separate  Account D may drop below the  reserves and other  liabilities  we must  maintain.  Should the value of the assets in Separate
Account D drop below the reserve and other  liabilities  we must  maintain in relation to the  annuities  supported by such assets,  we
will transfer  assets from our general account to Separate  Account D to make up the  difference.  We have the right to transfer to our
general  account any assets of Separate  Account D in excess of such  reserves and other  liabilities.  We maintain  assets in Separate
Account D supporting a number of annuities we offer.

We currently employ  investment  managers to manage the assets  maintained in Separate Account D. Each manager we employ is responsible
for  investment  management  of a different  portion of Separate  Account D. From time to time  additional  investment  managers may be
employed or investment  managers may cease being  employed.  We are under no obligation to employ or continue to employ any  investment
manager(s) and have sole discretion over the investment managers we retain.

We are not  obligated to invest  according to specific  guidelines  or strategies  except as may be required by  Connecticut  and other
state insurance laws.

WHAT IS THE LEGAL STRUCTURE OF THE UNDERLYING FUNDS?
Each underlying  mutual fund is registered as an open-end  management  investment  company under the Investment  Company Act. Shares of
the  underlying  mutual fund  portfolios  are sold to separate  accounts of life  insurance  companies  offering  variable  annuity and
variable life insurance products.  The shares may also be sold directly to qualified pension and retirement plans.

Voting Rights
We are the legal owner of the shares of the underlying  mutual funds in which the Sub-accounts  invest.  However,  under SEC rules, you
have voting rights in relation to Account Value  maintained in the  Sub-accounts.  If an underlying  mutual fund  portfolio  requests a
vote of  shareholders,  we will vote our shares  based on  instructions  received  from Owners with  Account  Value  allocated  to that
Sub-account.  Owners  have the right to vote an amount  equal to the number of shares  attributable  to their  contracts.  If we do not
receive voting  instructions in relation to certain  shares,  we will vote those shares in the same manner and proportion as the shares
for which we have  received  instructions.  We will furnish  those  Owners who have Account  Value  allocated  to a  Sub-account  whose
underlying  mutual fund  portfolio has requested a "proxy" vote with proxy  materials and the necessary  forms to provide us with their
voting  instructions.  Generally,  you will be asked to provide instructions for us to vote on matters such as changes in a fundamental
investment  strategy,  adoption of a new investment advisory  agreement,  or matters relating to the structure of the underlying mutual
fund that require a vote of shareholders.

American  Skandia  Trust (the  "Trust")  has  obtained an  exemption  from the  Securities  and  Exchange  Commission  that permits its
investment adviser, American Skandia Investment Services,  Incorporated ("ASISI"),  subject to approval by the Board of Trustees of the
Trust, to change sub-advisors for a Portfolio and to enter into new sub-advisory  agreements,  without obtaining  shareholder  approval
of the changes.  This exemption (which is similar to exemptions  granted to other investment  companies that are organized in a similar
manner as the Trust) is  intended  to  facilitate  the  efficient  supervision  and  management  of the  sub-advisors  by ASISI and the
Trustees.  The Trust is required,  under the terms of the exemption,  to provide certain  information to  shareholders  following these
types of changes.

Material Conflicts
It is possible  that  differences  may occur  between  companies  that offer  shares of an  underlying  mutual fund  portfolio to their
respective  separate  accounts  issuing  variable  annuities  and/or  variable  life  insurance  products.  Differences  may also occur
surrounding  the offering of an underlying  mutual fund portfolio to variable life insurance  policies and variable  annuity  contracts
that we offer. Under certain  circumstances,  these differences could be considered  "material  conflicts," in which case we would take
necessary  action to protect  persons with voting rights under our variable  annuity  contracts and variable  life  insurance  policies
against persons with voting rights under other insurance  companies'  variable  insurance  products.  If a "material  conflict" were to
arise between owners of variable  annuity  contracts and variable life insurance  policies issued by us we would take necessary  action
to treat  such  persons  equitably  in  resolving  the  conflict.  "Material  conflicts"  could  arise  due to  differences  in  voting
instructions  between owners of variable life insurance and variable annuity contracts of the same or different  companies.  We monitor
any potential conflicts that may exist.

Service Fees Payable to American Skandia
American  Skandia or our affiliates have entered into  agreements with the investment  adviser or distributor of many of the underlying
Portfolios.  Under the terms of these agreements,  American Skandia provides  administrative and support services to the Portfolios for
which a fee is paid that is generally based on a percentage of the average assets  allocated to the Portfolios  under the Annuity.  Any
fees payable will be  consistent  with the  services  rendered or the expected  cost  savings  resulting  from the  arrangement.  These
agreements may be different for each underlying mutual fund whose portfolios are offered as Sub-accounts.

WHO DISTRIBUTES ANNUITIES OFFERED BY AMERICAN SKANDIA?
American  Skandia  Marketing,  Incorporated  ("ASM"),  a wholly-owned  subsidiary of American  Skandia,  Inc., is the  distributor  and
principal  underwriter of the securities  offered through this prospectus.  ASM acts as the distributor of a number of annuity and life
insurance  products we offer and both  American  Skandia  Trust and American  Skandia  Advisor  Funds,  Inc., a family of retail mutual
funds. ASM also acts as an introducing  broker-dealer  through which it receives a portion of brokerage  commissions in connection with
purchases and sales of  securities  held by portfolios  of American  Skandia Trust which are offered as underlying  investment  options
under the Annuity.

ASM's principal  business  address is One Corporate Drive,  Shelton,  Connecticut  06484. ASM is registered as broker-dealer  under the
Securities Exchange Act of 1934 ("Exchange Act") and is a member of the National Association of Securities Dealers, Inc. ("NASD").

The  Annuity is offered on a  continuous  basis.  ASM enters into  distribution  agreements  with  independent  broker-dealers  who are
registered  under the Exchange Act and with  entities  that may offer the Annuity but are exempt from  registration.  Applications  for
the Annuity are solicited by registered  representatives  of those firms.  Such  representatives  will also be our appointed  insurance
agents under state insurance law.  In addition, ASM may offer the Annuity directly to potential purchasers.

Compensation is paid to firms on sales of the Annuity according to one or more schedules.  The individual  representative  will receive
a portion of the  compensation,  depending on the practice of the firm.  Compensation  is generally  based on a percentage  of Purchase
Payments  made, up to a maximum of 5.5%.  Alternative  compensation  schedules are  available  that provide a lower initial  commission
plus ongoing annual  compensation  based on all or a portion of Account Value. We may also provide  compensation for providing  ongoing
service to you in relation to the  Annuity.  Commissions  and other  compensation  paid in relation to the Annuity do not result in any
additional charge to you or to the Separate Account.

In addition,  firms may receive separate compensation or reimbursement for, among other things, training of sales personnel,  marketing
or other  services  they provide to us or our  affiliates.  We or ASM may enter into  compensation  arrangements  with  certain  firms.
These  arrangements  will  not be  offered  to all  firms  and the  terms of such  arrangements  may  differ  between  firms.  Any such
compensation  will be paid by us or ASM and will not result in any  additional  charge to you.  To the extent  permitted  by NASD rules
and other applicable laws and regulations,  ASM may pay or allow other promotional  incentives or payments in the form of cash or other
compensation.

Advertising:  We may advertise certain  information  regarding the performance of the investment  options.  Details on how we calculate
performance  for the  Sub-accounts  are found in the  Statement of Additional  Information.  This  information  may help you review the
performance of the investment  options and provide a basis for comparison  with other  annuities.  This  information may be less useful
when comparing the  performance of the investment  options with other savings or investment  vehicles.  Such other  investments may not
provide some of the benefits of annuities,  or may not be designed for long-term  investment  purposes.  Additionally  other savings or
investment vehicles may not be receive the beneficial tax treatment given to annuities under the Code.

We may advertise the  performance  of the  Portfolios in the form of "Standard" and  "Non-standard"  Total Returns  calculated for each
Sub-account.  "Standard  Total Return" figures assume a hypothetical  initial  investment of $1,000  allocated to a Sub-account  during
the most recent,  one, five and ten year periods (or since the inception date that the Portfolio has been offered as a Sub-account,  if
less).  "Standard Total Return"  figures assume that the applicable  Insurance  Charge and the Annual  Maintenance Fee are deducted and
that the Annuity is  surrendered  at the end of the applicable  period,  meaning that any  Contingent  Deferred Sales Charge that would
apply upon  surrender is also  deducted.  "Non-standard  Total Return"  figures  include any  performance  figures that do not meet the
SEC's rules for Standard Total Returns.  Non-standard  Total Returns are calculated in the same manner as  standardized  returns except
that the figures may not reflect  all fees and  charges.  In  particular,  they may assume no  surrender  at the end of the  applicable
period so that the CDSC does not apply.  "Non-standard  Total Returns" may also assume that the Annual  Maintenance  Fee does not apply
due to the average  Account Value being greater than  $100,000,  where the charge is waived.  Standard and  Non-standard  Total Returns
will not reflect the  additional  asset-based  charges that are deducted  when you elect any optional  benefits.  The  additional  cost
associated  with any optional  benefits you elected will reduce your  performance.  Non-Standard  Total Returns must be  accompanied by
Standard Total Returns.

Some of the underlying  Portfolios existed prior to the inception of these  Sub-accounts.  Performance quoted in advertising  regarding
such  Sub-accounts may indicate  periods during which the Sub-accounts  have been in existence but prior to the initial offering of the
Annuities,  or  periods  during  which  the  underlying  Portfolios  have  been in  existence,  but the  Sub-accounts  have  not.  Such
hypothetical  historical  performance  is calculated  using the same  assumptions  employed in  calculating  actual  performance  since
inception  of the  Sub-accounts.  Hypothetical  historical  performance  of the  underlying  Portfolios  prior to the  existence of the
Sub-accounts may only be presented as Non-Standard Total Returns.

We may advertise the performance of money market-type  Sub-accounts  using a measure of the "current and effective yield".  The current
yield of a money  market-type  Sub-account is calculated  based upon the previous  seven-day  period ending on the date of calculation.
The effective yield of a money  market-type  Sub-account  reflects the  reinvestment of net income earned daily on the assets of such a
Sub-account.  The current and effective  yields reflect the Insurance  Charge and the charge for any optional  benefits (if applicable)
deducted against the Sub-account.  In a low interest rate environment,  yields for money market-type  Sub-accounts,  after deduction of
the  Insurance  Charge,  and the charge for any  optional  benefits  (if  applicable)  may be negative  even  though the yield  (before
deducting for such charges) is positive.  Current and effective yield  information  will fluctuate.  This information may not provide a
basis for  comparisons  with  deposits in banks or other  institutions  which pay a fixed yield over a stated  period of time,  or with
investment  companies which do not serve as underlying  mutual funds for variable  annuities and/or do not have additional  asset-based
charges deducted for the insurance protection provided by the Annuity.

Performance  information on the  Sub-accounts is based on past performance  only and is not an indication or  representation  of future
performance.  Performance of the Sub-accounts is not fixed.  Actual  performance will depend on the type,  quality and, for some of the
Sub-accounts,  the  maturities  of the  investments  held by the  underlying  mutual funds or  portfolios  and upon  prevailing  market
conditions and the response of the underlying  mutual funds to such conditions.  Actual  performance will also depend on changes in the
expenses of the underlying mutual funds or portfolios.  Such changes are reflected,  in turn, in the Sub-accounts  which invest in such
underlying  mutual fund or portfolio.  In addition,  the total amount of asset-based  charges  assessed  against each  Sub-account will
affect performance.

The information we may advertise  regarding the Fixed  Allocations may include the then current  interest rates we are crediting to new
Fixed  Allocations.  Information  on current rates will be as of the date  specified in such  advertisement.  Rates will be included in
advertisements  to the extent  permitted by law. Given that the actual rates  applicable to any Fixed  Allocation are as of the date of
any such Fixed  Allocation's  Guarantee Period begins, the rate credited to a Fixed Allocation may be more or less than those quoted in
an advertisement.

Advertisements  we distribute  may also compare the  performance  of our  Sub-accounts  with:  (a) certain  unmanaged  market  indices,
including  but not limited to the Dow Jones  Industrial  Average,  the Standard & Poor's 500, the NASDAQ 100, the Shearson  Lehman Bond
Index, the Frank Russell non-U.S.  Universal Mean, the Morgan Stanley Capital  International  Index of Europe, Asia and Far East Funds,
and the Morgan Stanley Capital  International World Index; and/or (b) other management  investment companies with investment objectives
similar to the mutual  fund or  portfolio  underlying  the  Sub-accounts  being  compared.  This may include  the  performance  ranking
assigned by various publications,  including but not limited to the Wall Street Journal,  Forbes,  Fortune,  Money, Barron's,  Business
Week, USA Today and statistical  services,  including but not limited to Lipper Analytical Services Mutual Funds Survey, Lipper Annuity
and Closed End Survey,  the Variable  Annuity  Research Data Survey,  SEI, the  Morningstar  Mutual Fund Sourcebook and the Morningstar
Variable Annuity/Life Sourcebook.

American  Skandia Life Assurance  Corporation  may advertise its rankings  and/or ratings by independent  financial  ratings  services.
Such  rankings may help you in  evaluating  our ability to meet our  obligations  in relation to Fixed  Allocations,  pay minimum death
benefits,  pay annuity  payments or  administer  Annuities.  Such rankings and ratings do not reflect or relate to the  performance  of
Separate Account B.

AVAILABLE INFORMATION
A  Statement  of  Additional  Information  is  available  from us without  charge upon your  request.  This  Prospectus  is part of the
registration  statement we filed with the SEC regarding this offering.  Additional  information on us and this offering is available in
those  registration  statements and the exhibits  thereto.  You may obtain copies of these  materials at the prescribed  rates from the
SEC's Public Reference Section, 450 Fifth Street N.W., Washington,  D.C., 20549. You may inspect and copy those registration statements
and exhibits thereto at the SEC's public reference  facilities at the above address,  Room 1024, and at the SEC's Regional Offices, The
Woolworth  Building,  233 Broadway,  New York, NY and 175 W. Jackson  Boulevard,  Suite 900, Chicago,  IL. These documents,  as well as
documents  incorporated  by  reference,  may  also be  obtained  through  the  SEC's  Internet  Website  (http://www.sec.gov)  for this
registration statement as well as for other registrants that file electronically with the SEC.

INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
To the extent and only to the extent that any statement in a document  incorporated  by reference  into this  Prospectus is modified or
superseded by a statement in this  Prospectus or in a later-filed  document,  such statement is hereby deemed so modified or superseded
and not part of this  Prospectus.  The Annual Report on Form 10-K for the year ended December 31, 2002 previously  filed by the Company
with the SEC under the Exchange Act is incorporated by reference in this Prospectus.

We will furnish you without charge a copy of any or all of the documents  incorporated by reference in this  Prospectus,  including any
exhibits to such  documents  which have been  specifically  incorporated  by  reference.  We will do so upon receipt of your written or
oral request.

HOW TO CONTACT US
You can contact us by:
|X|      calling  our  Customer  Service  Team  at  1-800-680-8920,  or  Skandia's  Telephone  Automated  Response  System  (STARS)  at
       1-800-766-4530.
|X|      writing to us via regular  mail at American  Skandia - Variable  Annuities,  Attention:  Stagecoach  Annuity,  P.O.  Box 7040,
       Bridgeport,  Connecticut  06601-7040 OR for express mail American Skandia - Variable Annuities,  Attention:  Stagecoach Annuity,
       One Corporate  Drive,  Shelton,  Connecticut  06484.  NOTE:  Failure to send mail to the proper address may result in a delay in
       our receiving and processing your request.
|X|      sending an email to service@prudential.com or visiting our Internet Website at www.americanskandia.prudential.com.
|X|      accessing information about your Annuity through our Internet Website at www.americanskandia.prudential.com.

You   can   obtain   account    information    through    Skandia's    Telephone    Automated    Response   System   (STARS)   and   at
www.americanskandia.prudential.com,  our Internet  Website.  Our Customer  Service  representatives  are also available during business
hours to provide you with information  about your account.  You can request certain  transactions  through our telephone voice response
system,  our  Internet  Website or  through a  customer  service  representative.  You can  provide  authorization  for a third  party,
including  your  attorney-in-fact  acting  pursuant to a power of  attorney  or an  investment  professional,  to access  your  account
information and perform certain  transactions on your account.  You will need to complete a form provided by us which  identifies those
transactions  that you wish to  authorize  via  telephonic  and  electronic  means and whether  you wish to  authorize a third party to
perform  any  such  transactions.  We  require  that  you or  your  representative  provide  proper  identification  before  performing
transactions  over the telephone or through our Internet  Website.  This may include a Personal  Identification  Number (PIN) that will
be   provided   to  you  upon  issue  of  your   Annuity   or  you  may   establish   or  change   your  PIN   through   STARS  and  at
www.americanskandia.prudential.com,  our Internet  Website.  Any third party that you authorize to perform  financial  transactions  on
your account will be assigned a PIN for your account.

Transactions  requested via telephone are recorded.  To the extent  permitted by law, we will not be responsible for any claims,  loss,
liability  or  expense  in  connection  with a  transaction  requested  by  telephone  or  other  electronic  means if we acted on such
transaction  instructions after following  reasonable  procedures to identify those persons authorized to perform  transactions on your
Annuity  using  verification  methods  which may include a request for your Social  Security  number,  PIN or other form of  electronic
identification.  We may be liable for losses due to unauthorized or fraudulent instructions if we did not follow such procedures.

American Skandia does not guarantee access to telephonic,  facsimile,  Internet or any other electronic  information or that we will be
able to accept  transaction  instructions  via such means at all times.  Regular and/or express mail will be the only means by which we
will accept  transaction  instructions when telephonic,  facsimile,  Internet or any other electronic means are unavailable or delayed.
American  Skandia  reserves  the  right to limit,  restrict  or  terminate  telephonic,  facsimile,  Internet  or any other  electronic
transaction privileges at any time.

INDEMNIFICATION
Insofar as  indemnification  for  liabilities  arising  under the  Securities  Act of 1933 (the  "Securities  Act") may be permitted to
directors,  officers or persons controlling the registrant pursuant to the foregoing provisions,  the registrant has been informed that
in the  opinion  of the SEC such  indemnification  is  against  public  policy as  expressed  in the  Securities  Act and is  therefore
unenforceable.

LEGAL PROCEEDINGS
As of the date of this  Prospectus,  American  Skandia and its  affiliates  are not  involved in any legal  proceedings  outside of the
ordinary  course of business.  American  Skandia and its  affiliates are involved in pending and  threatened  legal  proceedings in the
normal  course of its business,  however,  we do not  anticipate  that the outcome of any such legal  proceedings  will have a material
adverse  affect  on the  Separate  Account,  or  American  Skandia's  ability  to meet its  obligations  under the  Annuity,  or on the
distribution of the Annuity.

CONTENTS OF THE STATEMENT OF ADDITIONAL INFORMATION
The following are the contents of the Statement of Additional Information:

General Information about American Skandia
|X|      American Skandia Life Assurance Corporation
|X|      American Skandia Life Assurance Corporation Variable Account B
|X|      American Skandia Life Assurance Corporation Separate Account D

Principal Underwriter/Distributor - American Skandia Marketing, Incorporated

How Performance Data is Calculated
|X|      Current and Effective Yield
|X|      Total Return

How the Unit Price is Determined

Additional Information on Fixed Allocations
|X|      How We Calculate the Market Value Adjustment

General Information
|X|      Voting Rights
|X|      Modification
|X|      Deferral of Transactions
|X|      Misstatement of Age or Sex
|X|      Ending the Offer

Annuitization

Independent Auditors

Legal Experts

Financial Statements
         Appendix A - Financial Information About American Skandia








                                       APPENDIX A - FINANCIAL INFORMATION ABOUT AMERICAN SKANDIA




SELECTED FINANCIAL DATA (dollars in thousands)

The following table summarizes information with respect to the operations of the Company:

                                                       For the Year Ended December 31,
                                      2002            2001            2000           1999           1998
STATEMENTS OF INCOME DATA
Revenues:
Annuity and life insurance       $    370,004     $    388,696   $    424,578    $    289,989   $    186,211
   charges and fees (a) (b)
Fee income (b)                         97,650          111,196        130,610          83,243         50,839
Net investment income                  19,632           20,126         18,595          11,477         11,130
Net realized capital (losses)
   gains and other revenues (e)        (7,438)           2,698          4,195           3,688          1,360

Total revenues                   $    479,848     $    522,716   $    577,978    $    388,397   $    249,540

Benefits and Expenses:
Annuity and life insurance       $      3,391     $      1,955   $        751    $        612   $        558
benefits
Change in annuity and life
   insurance policy reserves            2,741          (39,898)        49,339            (671)         1,053
   (c)
Guaranteed minimum death
   benefit claims, net of              23,256           20,370          2,618           4,785              -
   hedge (b)
Return credited to contract             5,196            5,796          8,463          (1,639)        (8,930)
owners
Underwriting, acquisition and
   other insurance expenses           188,728          196,755        150,597         125,434         86,306
Amortization of deferred
   acquisition costs (b) (d)          510,059          224,047        184,616          83,861         86,628
Interest expense                       14,544           73,424         85,998          69,502         41,004

Total benefits and expenses      $    747,915     $    482,449   $    482,382    $    281,884   $    206,619

Income tax (benefit) expense     $   (102,810)    $      7,168   $     30,779    $     30,344   $      8,154

Net (loss) income                $   (165,257)    $     33,099   $     64,817    $     76,169   $     34,767

STATEMENTS OF FINANCIAL
CONDITION DATA
Total assets (b)                 $ 23,708,585     $ 28,009,782   $ 31,702,705    $ 30,881,579   $ 18,848,273

Future fees payable to parent    $    708,249     $    799,472   $    934,410    $    576,034   $    368,978

Surplus notes                    $    110,000     $    144,000   $    159,000    $    179,000   $    193,000

Shareholder's equity             $    683,061     $    577,668   $    496,911    $    359,434   $    250,417

a.       On annuity and life insurance sales of $3,472,044, $3,834,167, $8,216,167, $6,862,968, and $4,159,662, during the years
     ended December 31, 2002, 2001, 2000, 1999, and 1998, respectively, with contract owner assets under management of $21,894,636,
     $26,017,847, $29,751,822, $29,396,693, and $17,854,761, as of December 31, 2002, 2001, 2000, 1999, and 1998, respectively.
b.       These items are significantly impacted by equity market volatility.
c.       For the year ended December 31, 2000, change in annuity and life insurance policy reserves reflected increases to those
     reserves for guaranteed minimum death benefit ("GMDB") exposure.  For the year ended December 31, 2001, the Company changed
     certain of its assumptions related to its GMDB exposure resulting in a benefit to operations.  See Results of Operations in
     Management's Discussion and Analysis of Financial Condition and Results of Operations ("MD&A") for a further discussion.
d.       During the year ended December 31, 2002, the Company recorded an acceleration of amortization of $206,000 against the
     deferred acquisition cost asset.  See the MD&A for a further discussion.
e.       Net realized capital (losses) gains and other revenues include $5,845 of net realized capital losses on sales of securities
     during 2002 and an other than temporary impairment charge of $3,769 recorded during 2002 on the Company's equity securities.

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (dollars in thousands)

Management's  Discussion  and  Analysis  of  Financial  Condition  and Results of  Operations  should be read in  conjunction  with the
consolidated financial statements and the notes thereto and Item 6, Selected Financial Data.

 Results of Operations

Annuity and life insurance sales were  $3,472,044,  $3,834,167 and $8,216,167,  in 2002, 2001 and 2000,  respectively.  The decrease in
sales in 2002 and 2001 was  primarily  the result of the  general  decline in sales in the  industry,  attributed  in large part to the
continued  uncertainty  in the equity  markets.  In addition,  the Company  believes  uncertainty  regarding  its future  ownership has
adversely  impacted  sales,  primarily in the latter part of 2002. The Company  announced,  in the first quarter of 2002, its intention
to focus on the growth of its core variable annuity business.

Average assets under management totaled  $23,637,559 in 2002,  $26,792,877 in 2001 and $31,581,902 in 2000,  representing a decrease of
12% and 15% in 2002 and 2001,  respectively,  due primarily to weak equity markets.  The decrease in annuity and life insurance charges
and fees and fee income before  surrender  charge income and reinsurance  was consistent  with the decline in assets under  management.
Surrender  charge  income  increased  in 2002 as compared to 2001.  This was caused by higher  lapses when  compared to the  applicable
prior year periods,  and was primarily  attributable,  the Company believes,  to concerns by contract holders,  rating agencies and the
Company's  distribution  channels,  surrounding  the  uncertainty  in the equity markets and its impact on variable  annuity  companies
generally and, prior to the  announcement of the  Acquisition,  uncertainty  concerning the Company's future (See Liquidity and Capital
Resources for rating agency actions).

Net realized  capital losses in 2002 were primarily  from $9,593 of losses on sales and $3,769 of  other-than-temporary  impairments of
mutual  fund  investments  that are held in support of a deferred  compensation  program for certain of the  Company's  employees.  The
deferred  compensation  program losses were offset by net gains of $3,746 during 2002 on sales of fixed  maturities.  Included in those
net gains on sales of fixed  maturities for 2002,  was a realized loss of  approximately  $1,236 on the sale of a WorldCom,  Inc. bond.
The net capital gains in 2001 related primarily to sales of fixed maturity  investments,  were partially offset by losses on securities
in the fixed maturity  portfolio.  The most significant loss was $2,636 related to Enron  securities.  In addition net realized capital
losses of $3,534 in 2001 were  incurred  due to sales of mutual  fund  holdings  in support  of the  Company's  non-qualified  deferred
compensation program.

The change in annuity and life insurance  policy  reserves  includes  changes in reserves  related to annuity  contracts with mortality
risks.  During 2001, the Company's  Guaranteed Minimum Death Benefit ("GMDB") reserve decreased $43,984,  as the result of an update of
certain  reserve  assumptions  as to risks  inherent  in the  benefit.  Previous  assumptions  had been  based on  statutory  valuation
principles as an  approximation  for U.S.  GAAP. In addition,  future  mortality  rates were lowered in 2001 to reflect  favorable past
experience.  However,  offsetting  the resulting  increase in earnings and equity as a result of changes in the GMDB liability in 2001,
assumptions  related to GMDB claim costs were also updated in the  calculation  of the deferred  acquisition  cost asset,  resulting in
additional amortization of this asset.

The Company uses derivative  instruments,  which consist of equity option contracts for risk management  purposes,  and not for trading
or  speculation.  The Company  hedges the economic  GMDB  exposure  associated  with equity market  fluctuations.  GMDB claims,  net of
hedge,  consist of GMDB claims offset by the mark to market and realized capital  gain/loss  results of the Company's option contracts.
During 2002 and 2001, the  fluctuations in GMDB claims,  net of hedge,  were driven by an increase in hedge related benefits of $19,776
and $14,646,  respectively.  Hedge related  benefits were  partially  offset by increases in GMDB claims of $22,662 and $32,398  during
2002 and 2001, respectively.

Return  credited to contract  owners  consists  primarily of net investment  results from the Company's  fixed,  market value adjusted,
separate account  investment  option and changes in the Company's  experience rated reinsurance  receivables.  The decrease in 2002 was
primarily due to increased net investment  results on the Company's fixed,  market value adjusted,  separate account investment option.
As the equity markets  decline,  movement from variable  investment  options to fixed investment  options,  primarily due to one of the
Company's product features,  has increased the assets invested in the fixed separate account  investment  option.  Included in 2002 net
investment  results is $9,849 of realized  and  unrealized  losses on certain  securities,  of which $5,427  related to WorldCom,  Inc.
bonds. The increase in net investment  results was partially offset by a decrease in experience rated  reinsurance  receivables in 2002
due to unfavorable  experience on certain blocks of variable annuity  business.  In 2001,  return credited to contract owners decreased
primarily due to favorable  experience on certain blocks of variable  annuity  contracts  increasing the experience  rated  reinsurance
receivable.  Partially offsetting the 2001 decrease is net investment losses of $1,662 related to Enron securities.

Underwriting, acquisition and other insurance expenses for 2002, 2001 and 2000 were as follows:

                                                        2002              2001               2000
Commissions and purchase credits                         $   287,612       $   248,187         $   430,743
General operating expenses                                   145,438           157,704             214,957
Acquisition costs deferred                                  (244,322)         (209,136)           (495,103)
Underwriting,   acquisition   and   other   insurance
     expenses                                            $   188,728       $   196,755         $   150,597

New products  launched,  as well as a larger  proportion  of sales of products  with higher  commissions  as compared to 2001 led to an
increase in commissions  and purchase  credits during 2002.  Lower sales and asset levels led to a decrease in commissions and purchase
credits during 2001.  Partially  offsetting this decline in 2001, the company  launched a commission  promotion  program that increased
commissions as a percentage of new sales.  Commission promotions in 2002 were approximately equivalent as compared to 2001.

General operating expenses decreased during 2002 and 2001 as a result of lower sales-based  compensation,  as well as expense reduction
programs  implemented during 2001 and continued strong expense management in 2002.  Variable  compensation and long-term incentive plan
expenses have decreased due to the slowdown in sales and the decline in the equity markets.

Amortization of deferred  acquisition costs increased over the past two years, in general,  due to the further depressed equity markets
in 2002 and 2001,  thereby  decreasing  expectations  of future  gross  profits  and actual  gross  profits  from asset  based fees and
increased  expected and actual claim costs  associated with minimum death benefit  guarantees.  During 2002, the Company also performed
a  recoverability  study and an analysis of its  short-term  assumptions of future gross profits and  determined  those  assumptions of
future profits to be excessive.  This analysis  resulted in a current year  acceleration of  amortization of $206,000.  During 2002 and
2001, the Company also updated its future  estimated  gross profits with respect to certain  mortality  assumptions  reflecting  actual
experience and the decline in the equity markets resulting in additional  increased  amortization.  See Note 2 of Notes to Consolidated
Financial Statements for a further discussion on amortization of deferred acquisition costs.

Interest  expense  decreased  during 2002 primarily due to lower interest  expense  related to the future fees payable to ASI liability
(See Note 8).  Interest  expense on these  obligations  is driven by the cash flows from the  underlying  annuity  contracts  acting as
collateral.  Due to the  depressed  asset  values of those  annuity  contracts  driven by the decline in the equity  markets,  the cash
flows,  and therefore the interest  expense,  decreased  from prior year levels.  Interest  expense  decreased in 2001 as a result of a
reduction in borrowing.

The  Company's  income tax  (benefit)  expense  varies  directly  with  increases or decreases in (loss)  income from  operations.  The
effective income tax rate varied from the corporate rate of 35% due primarily to the deduction for dividends received.

Total assets and  liabilities  decreased  $4,301,197  and  $4,406,590,  respectively,  from  December 31,  2001.  This change  resulted
primarily from the declining equity markets.

 Significant Accounting Policies

 Deferred Acquisition Costs

The costs of acquiring  new  business,  which vary with and are  primarily  related to new business  generated,  are  deferred,  net of
reinsurance.  These costs include  commissions,  purchase credits,  costs of contract issuance,  and certain selling expenses that vary
with production.

The Company  uses the  retrospective  deposit  method for  amortizing  deferred  acquisition  costs.  This  method  results in deferred
acquisition  costs being amortized in proportion to expected gross profits from surrender  charges and policy and asset based fees, net
of operating and claim costs.  The deferred  acquisition cost asset is adjusted  retrospectively  and  prospectively  when estimates of
current and future  gross  profits to be realized  from a group of products are  revised.  Critical  assumptions  in  estimating  gross
profits  include those for  surrenders,  long-term fund growth rate,  expenses and death  benefits.  The long-term fund growth rate, in
large part,  determines the estimated  future asset levels on which the most significant  revenues are based.  The Company's  long-term
fund growth rate  assumption is 8% (net of charges  assessed  against the underlying  mutual fund,  but before charges  assessed at the
separate  account and  contract  level).  When current  period  actual  asset  growth is greater or less than the  Company's  long-term
expectation,  the Company  adjusts the  short-term  asset growth rate to a level that will allow the  Company,  in the  short-term,  to
resume the long-term  asset growth rate  expectation.  The short-term  asset growth rate is subject to constraints  surrounding  actual
market  conditions.  If the Company's  long-term fund growth rate assumption was 7% instead of 8%, the Company's  deferred  acquisition
cost asset at December 31, 2002 would be reduced by $26,273.

 Future Fees Payable to ASI

In a series of transactions with ASI, the Company  transferred  certain rights to receive a portion of future fees and contract charges
expected to be realized on designated blocks of deferred annuity contracts.

The proceeds from the transfers have been recorded as a liability and are being  amortized over the remaining  surrender  charge period
of the  designated  contracts  using the interest  method.  The Company did not  transfer the right to receive  future fees and charges
after the expiration of the surrender charge period.

In connection with these transactions,  ASI, through special purpose trusts, issued  collateralized notes in private placements,  which
are secured by the rights to receive future fees and charges purchased from the Company.

Under the terms of the securitization  purchase  agreements,  the rights transferred  provide for ASI to receive a percentage (60%, 80%
or 100% depending on the underlying  commission option) of future mortality and expense charges and contingent  deferred sales charges,
after reinsurance,  expected to be realized over the remaining  surrender charge period of the designated  contracts  (generally 6 to 8
years).  The liability for future fees payable to ASI at the balance sheet date is based on the  consideration  received less principal
repayments  according to  amortization  schedules that were  developed at the inception of the  transactions.  If actual  mortality and
expense  charges  and  contingent  deferred  sales  charges  are less than those  projected  in the  original  amortization  schedules,
calculated on a transaction by transaction  basis,  ASI has no recourse  against the Company.  As account  values  associated  with the
designated  contracts  have declined,  consistent  with the overall  decline in the equity  markets,  historical  mortality and expense
charges have been lower than expected on certain  transactions  and it is likely that future  mortality and expense  charges,  on those
same  transactions,  will be lower than originally  projected.  As a result, the ultimate cash flows associated with these transactions
that will transfer to ASI may be lower than the current carrying amount of the liability.

The Company has determined,  using  assumptions for lapses,  mortality,  free withdrawals and a long-term fund growth rate of 8% on the
Company's assets under management, that the present value of future payments to ASI would be $429,773.

 Deferred Taxes

The Company  evaluates the necessity of recording a valuation  allowance against its deferred tax asset in accordance with Statement of
Financial  Accounting  Standards  No. 109,  Income Taxes ("SFAS  109").  In  performing  this  evaluation,  the Company  considers  all
available  evidence in making the  determination  as to whether it is more likely than not that deferred tax assets are not realizable.
For the Company,  that evidence  includes:  cumulative U.S. GAAP pre-tax income in recent years past,  whether or not operating  losses
have  expired  unused in the past,  the  length  of  remaining  carryback  or  carryforward  periods,  and net  taxable  income or loss
expectations in early future years.  The net taxable income or loss projections are based on profit  assumptions  consistent with those
used to amortize deferred acquisition costs (see above discussion on deferred acquisition costs).

As of December 31, 2002, the Company has  approximately  $361,000  gross deferred tax assets related  principally to net operating loss
carryforwards  that  expire in 2016 and 2017 and  insurance  reserve  differences.  After  considering  the  impact of gross  reversing
temporary  liabilities of $323,000,  the Company  estimates that the Company will generate  sufficient  taxable income to fully utilize
gross deferred tax assets within 2 years (prior to the expiration of the net operating losses).

 Liquidity and Capital Resources

The Company's  liquidity  requirements have generally been met by cash from insurance  operations,  investment  activities,  borrowings
from ASI, reinsurance, capital contributions and securitization transactions with ASI (see Note 8).

The Company's cash from insurance  operations is primarily comprised of fees generated off of assets under management,  less commission
expense on sales,  sales and marketing  expenses and other operating  expenses.  Fund performance driven by the equity markets directly
impact assets under  management  and  therefore,  the fees the Company can generate off of those assets.  During 2002 and 2001,  assets
under  management  declined  consistent  with the equity market  declines  resulting in reductions  in fee revenues.  In addition,  the
equity markets impact sales of variable  annuities.  As sales have declined in a declining  equity market,  non-promotional  commission
expense  declined,  however,  in order to boost sales levels,  the Company has offered various sales  promotions  increasing the use of
cash for commission expense.

In order to fund the cash strain generated from  acquisition  costs on current sales, the Company has relied on cash generated from its
direct  insurance  operations  as well as  reinsurance  and  securitization  transactions.  The Company has used  modified  coinsurance
reinsurance  arrangements  whereby  the  reinsurer  shares  in the  experience  of a  specified  book of  business.  These  reinsurance
transactions  result in the Company  receiving  from the  reinsurer  an upfront  ceding  commission  on the book of  business  ceded in
exchange  for the  reinsurer  receiving , the future fees  generated  from that book of business.  These  reinsurance  agreements  also
mitigate the  recoverability  risk associated with the payment of up-front  commissions and other  acquisition  costs.  Similarly,  the
Company has entered into  securitization  transactions  whereby the Company  issues to ASI, in exchange for cash,  the right to receive
future  fees  generated  off of a  specific  book of  business.  On April 12,  2002,  the  Company  entered  into a new  securitization
transaction with ASI. This  transaction  covers  designated  blocks of business issued from November 1, 2000 through December 31, 2001.
The estimated present value of the transaction at April 12, 2002, using a discount rate of 6.00%, was approximately $101,713.

As of December 31, 2002, 2001 and 2000, the Company had short-term borrowings of $10,000,  $10,000 and $10,000,  respectively,  and had
long-term surplus notes liabilities of $110,000,  $144,000 and $159,000,  respectively.  During 2002, the Company borrowed $263,091 and
paid back  $263,091  related  to  short-term  borrowing.  During  2002 and 2001,  the  Company  received  permission  from the State of
Connecticut  Insurance  Department  to pay down surplus notes in the amount of $34,000 and $15,000,  respectively.  See Notes 14 and 15
of Notes to Consolidated Financial Statements for more information on surplus notes and short-term borrowing, respectively.

As of December 31, 2002,  2001 and 2000,  shareholder's  equity  totaled  $683,061,  $577,668 and $496,911,  respectively.  The Company
received  capital  contributions  of $259,720  and $48,000  from ASI during 2002 and 2001,  respectively.  Of this,  $4,520 and $2,500,
respectively,  was used to support its  investment in Skandia Vida.  Net (loss) income of ($165,257)  and $33,099,  for the years ended
December 31, 2002 and 2001, respectively, contributed to the respective changes in shareholder's equity in 2002 and 2001.

The National  Association of Insurance  Commissioners  ("NAIC") requires insurance  companies to report  information  regarding minimum
Risk Based Capital ("RBC")  requirements.  These  requirements  are intended to allow insurance  regulators to identify  companies that
may need  regulatory  attention.  The RBC model law requires  that  insurance  companies  apply various  factors to asset,  premium and
reserve items,  all of which have inherent risks. The formula includes  components for asset risk,  insurance risk,  interest rate risk
and business  risk.  The Company has complied  with the NAIC's RBC reporting  requirements  and has total  adjusted  capital well above
required capital.

During 2002, all of the major rating agencies  reviewed the U.S. life insurance sector,  including the Company.  Based on these reviews
the rating  agencies  have evolving  concerns  surrounding  the risk profile of variable  annuity  companies  due to their  significant
exposure to equity market performance.  This exposure has resulted,  and may continue to result, in earnings  volatility.  Based on the
reviews made during 2002, the following ratings actions took place:

On May 8, 2002, Fitch Ratings downgraded the Company's "insurer financial strength" rating to A+ from AA- with a "stable" outlook.

On September  19, 2002,  Fitch Ratings  lowered the  Company's  "insurer  financial  strength"  rating to A- from A+ with an "evolving"
outlook.

On September 27, 2002, A.M. Best Co. lowered the Company's "financial strength" rating to A- from A with negative implications.

On October 16, 2002,  Standard and Poor's lowered the Company's  "counter party credit" and "financial  strength" ratings to A- from A+
with a negative outlook and removed the Company from Credit Watch.

Subsequent to the announcement of the Acquisition, Standard and Poor's placed the Company on CreditWatch with positive implications.

 Effects of Inflation

The rate of inflation has not had a significant effect on the Company's financial statements.

Outlook

The Company  believes  that it is well  positioned to retain and enhance its position as a leading  provider of financial  products for
long-term  savings and retirement  purposes as well as to address the economic impact of premature death,  estate planning concerns and
supplemental  retirement  needs.  The  Company  has  renewed  its focus on its core  variable  annuity  business,  offering  innovative
long-term  savings and income  products,  strengthening  its wholesaling  efforts and providing  consistently  good customer service in
order to gain market share and improve profitability in an increasingly competitive market.

The  Gramm-Leach-Bliley  Act of 1999 (the Financial Services  Modernization Act) permits affiliation among banks,  securities firms and
insurance  companies.  This  legislative  change has created  opportunities  for  continued  consolidation  in the  financial  services
industry and increased competition as large companies offer a wide array of financial products and services.

Various  other  legislative  initiatives  could  impact the Company  such as pension  reform and capital  gains and estate tax changes.
These include the proposed  exclusion from tax for corporate  dividends,  potential changes to the deductibility of dividends  received
from the  Company's  separate  accounts and newly  proposed  tax-advantaged  savings  programs.  Additional  pension  reform may change
current  tax  deferral  rules  and allow  increased  contributions  to  retirement  plans,  which  may lead to  higher  investments  in
tax-deferred  products and create growth  opportunities for the Company. A capital gains tax reduction may cause tax-deferred  products
to be less attractive to consumers, which could adversely impact the Company.

In addition,  NAIC statutory  reserving  guidelines and/or  interpretations of those guidelines may change in the future.  Such changes
may require the Company to modify, perhaps materially, its statutory-based reserves for variable annuity contracts.

 Forward Looking Information

The Private  Securities  Litigation  Reform Act of 1995 (the "1995 Act") provides a "safe harbor" for  forward-looking  statements,  so
long as those  statements are identified as  forward-looking,  and the statements are accompanied by meaningful  cautionary  statements
that identify  important  factors that could cause actual results to differ  materially from those discussed in the statement.  We want
to take advantage of these safe harbor provisions.

Certain  information  contained in the  Management's  Discussion  and  Analysis of Financial  Condition  and Results of  Operations  is
forward-looking within the meaning of the 1995 Act or Securities and Exchange Commission rules.


These forward-looking  statements rely on a number of assumptions  concerning future events, and are subject to a number of significant
uncertainties  and results may differ  materially  from these  statements.  You should not put undue reliance on these  forward-looking
statements.  We disclaim  any  intention  or  obligation  to update or revise  forward-looking  statements,  whether as a result of new
information, future events or otherwise.


 QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The Company is subject to potential  fluctuations in earnings and the fair value of certain of its assets and  liabilities,  as well as
variations in expected cash flows due to changes in market  interest  rates and equity  prices.  The  following  discussion  focuses on
specific  exposures  the Company has to interest rate and equity price risk and describes  strategies  used to manage these risks,  and
includes  "forward-looking  statements"  that involve  risk and  uncertainties.  The  discussion  is limited to  financial  instruments
subject to market risks and is not intended to be a complete discussion of all of the risks to which the Company is exposed.

 Interest Rate Risk

Fluctuations in interest rates can potentially  impact the Company's  profitability and cash flows. At December 31, 2002, 91% of assets
held under management by the Company are in non-guaranteed  Separate  Accounts for which the Company's  interest rate and equity market
exposure is not  significant,  as the contract owner assumes  substantially  all of the investment risk. Of the remaining 9% of assets,
the interest rate risk from contracts that carry interest rate exposure is managed through an  asset/liability  matching  program which
takes into account the risk variables of the insurance liabilities supported by the assets.

At December 31, 2002,  the Company held fixed  maturity  investments  in its general  account that are sensitive to changes in interest
rates.  These  securities are held in support of the Company's fixed immediate  annuities,  fixed  supplementary  contracts,  the fixed
investment  option offered in its variable life insurance  contracts,  and in support of the Company's  target  solvency  capital.  The
Company has a conservative  investment  philosophy with regard to these  investments.  All  investments are investment  grade corporate
securities, government agency or U.S. government securities.

The Company's  deferred annuity  products offer a fixed  investment  option which subjects the Company to interest rate risk. The fixed
option  guarantees a fixed rate of interest for a period of time selected by the contract  owner.  Guarantee  period options  available
range  from one to ten  years.  Withdrawal  of funds,  or  transfer  of funds to  variable  investment  options,  before the end of the
guarantee period subjects the contract owner to a market value adjustment  ("MVA").  In the event of rising interest rates,  which make
the fixed maturity  securities  underlying the guarantee less valuable,  the MVA could be negative.  In the event of declining interest
rates,  which make the fixed maturity  securities  underlying the guarantee  more  valuable,  the MVA could be positive.  The resulting
increase or decrease in the value of the fixed  option,  from  calculation  of the MVA,  should  substantially  offset the  increase or
decrease in the market value of the securities  underlying the guarantee.  The Company  maintains  strict  asset/liability  matching to
enable this offset.  However,  the Company  still takes on the default risk for the  underlying  securities,  the interest rate risk of
reinvestment of interest  payments and the risk of failing to maintain the  asset/liability  matching  program with respect to duration
and convexity.

Liabilities held in the Company's  guaranteed  separate  account as of December 31, 2002 totaled  $1,828,048.  Assets,  primarily fixed
income  investments,  supporting  those  liabilities had a fair value of $1,828,048.  The Company  performed a sensitivity  analysis on
these  interest-sensitive  liabilities  and assets at December 31, 2002.  The analysis  showed that an immediate  decrease of 100 basis
points in interest  rates would result in a net increase in  liabilities  and the  corresponding  assets of  approximately  $69,150 and
$68,500,  respectively.  An analysis of a 100 basis point  decline in interest  rates at December  31,  2001,  showed a net increase in
interest-sensitive liabilities and the corresponding assets of approximately $39,800 and $39,900, respectively.

 Equity Market Exposure

The primary  equity  market risk to the Company  comes from the nature of the variable  annuity and variable  life products sold by the
Company.  Various fees and charges  earned are  substantially  derived as a percentage of the market value of assets under  management.
In a market  decline,  this  income will be reduced.  This could be further  compounded  by  customer  withdrawals,  net of  applicable
surrender  charge  revenues,  partially  offset by transfers to the fixed option  discussed above. A 10% decline in the market value of
the assets under management at December 31, 2002,  sustained  throughout 2003, would result in an approximate drop in related mortality
and expense charges and annual fee income of $36,350.

Another equity market risk exposure of the Company  relates to guaranteed  minimum death benefit  payments.  Declines in equity markets
and,  correspondingly,  the performance of the funds underlying the Company's  products,  increase exposure to guaranteed minimum death
benefit payments. As discussed in Note 2D of the consolidated  financial statements,  the Company uses derivative  instruments to hedge
against  the risk of  significant  decreases  in  equity  markets.  Prior to the  implementation  of this  program,  the  Company  used
reinsurance to mitigate this risk.

The Company has a portfolio of equity  investments  consisting  of mutual funds,  which are held in support of a deferred  compensation
program.  In the event of a decline in market values of underlying  securities,  the value of the portfolio would decline;  however the
accrued benefits payable under the related deferred compensation program would decline by a corresponding amount.

Estimates  of interest  rate risk and equity  price risk were  obtained  using  computer  models that take into  consideration  various
assumptions  about the future.  Given the uncertainty of future interest rate movements,  volatility in the equity markets and consumer
behavior, actual results may vary from those predicted by the Company's models.



                                             AUDITED CONSOLIDATED FINANCIAL STATEMENTS OF
                                              AMERICAN SKANDIA LIFE ASSURANCE CORPORATION





                                                    Report of Independent Auditors

To the Board of Directors and Shareholder of
    American Skandia Life Assurance Corporation
Shelton, Connecticut

We have audited the  consolidated  statements of financial  condition of American  Skandia Life  Assurance  Corporation  (the "Company"
which is an indirect  wholly-owned  subsidiary of Skandia  Insurance  Company  Ltd.) as of December 31, 2002 and 2001,  and the related
consolidated  statements of income,  shareholder's  equity and cash flows for each of the three years in the period ended  December 31,
2002. These consolidated  financial statements are the responsibility of the Company's management.  Our responsibility is to express an
opinion on these consolidated financial statements based on our audits.

We conducted our audits 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 audits provide a reasonable basis for our opinion.

In our opinion,  the financial  statements  referred to above present fairly,  in all material  respects,  the  consolidated  financial
position  of American  Skandia  Life  Assurance  Corporation  at December  31,  2002 and 2001,  and the  consolidated  results of their
operations  and their cash flows for each of the three years in the period ended  December  31, 2002,  in  conformity  with  accounting
principles generally accepted in the United States.

As discussed in Note 2, in 2002 the Company adopted Statement of Financial Accounting Standards No. 142, Goodwill and Other
Intangible Assets.

As discussed in Note 2, effective January 1, 2001, the Company adopted Statement of Financial Accounting Standards No. 133,
Accounting for Derivative Instruments and Hedging Activities.


/s/ Ernst & Young LLP

Hartford, Connecticut
February 3, 2003


                                              AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                                (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                            Consolidated Statements of Financial Condition
                                                   (in thousands, except share data)

                                                                           As of December 31,
                                                                          2002            2001
ASSETS
Investments:
   Fixed maturities - at fair value (amortized cost of $379,422
     and $356,882, respectively)                                     $       398,601 $       362,831
   Equity securities - at fair value (amortized cost of $52,017
     and $49,886, respectively)                                               51,769          45,083
   Derivative instruments - at fair value                                     10,370           5,525
   Policy loans                                                                7,559           6,559

     Total investments                                                       468,299         419,998

Cash and cash equivalents                                                     51,339               -
Accrued investment income                                                      4,196           4,737
Deferred acquisition costs                                                 1,117,544       1,383,281
Reinsurance receivable                                                         5,447           7,733
Receivable from affiliates                                                     3,961           3,283
Income tax receivable                                                              -          30,537
Deferred income taxes                                                         38,206               -
Fixed assets, at depreciated cost (accumulated depreciation of
$7,555 and $4,266, respectively)                                              12,132          17,752
Other assets                                                                 101,848         103,912
Separate account assets                                                   21,905,613      26,038,549

     Total assets                                                    $    23,708,585 $    28,009,782

LIABILITIES AND SHAREHOLDER'S EQUITY
Liabilities:
Reserves for future policy and contract benefits                     $       149,349 $        91,126
Accounts payable and accrued expenses                                        133,543         192,952
Income tax payable                                                             6,547               -
Deferred income taxes                                                              -          54,980
Payable to affiliates                                                          2,223         101,035
Future fees payable to American Skandia, Inc. ("ASI")                        708,249         799,472
Short-term borrowing                                                          10,000          10,000
Surplus notes                                                                110,000         144,000
Separate account liabilities                                              21,905,613      26,038,549

     Total liabilities                                                    23,025,524      27,432,114

Commitments and contingent liabilities (Note 18)

Shareholder's equity:
Common stock, $100 par value, 25,000 shares authorized,
   issued and outstanding                                                      2,500           2,500
Additional paid-in capital                                                   595,049         335,329
Retained earnings                                                             73,821         239,078
Accumulated other comprehensive income                                        11,691             761

     Total shareholder's equity                                              683,061         577,668

     Total liabilities and shareholder's equity                      $    23,708,585 $    28,009,782

                                            See notes to consolidated financial statements.
                                              AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                                (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                                   Consolidated Statements of Income
                                                            (in thousands)

                                                                       For the Years Ended December 31,
                                                                      2002          2001           2000

REVENUES

Annuity and life insurance charges and fees                       $    370,004  $    388,696  $    424,578
Fee income                                                              97,650       111,196       130,610
Net investment income                                                   19,632        20,126        18,595
Net realized capital (losses) gains                                     (9,614)          928          (688)
Other                                                                    2,176         1,770         4,883

   Total revenues                                                      479,848       522,716       577,978


EXPENSES

Benefits:
   Annuity and life insurance benefits                                   3,391         1,955           751
   Change in annuity and life insurance policy reserves                  2,741       (39,898)       49,339
   Guaranteed minimum death benefit claims, net of hedge                23,256        20,370         2,618
   Return credited to contract owners                                    5,196         5,796         8,463

     Total benefits                                                     34,584       (11,777)       61,171

Other:
   Underwriting, acquisition and other insurance
     expenses                                                          188,728       196,755       150,597
   Amortization of deferred acquisition costs                          510,059       224,047       184,616
   Interest expense                                                     14,544        73,424        85,998

                                                                       713,331       494,226       421,211

   Total benefits and expenses                                         747,915       482,449       482,382

     (Loss) income from operations before income tax
(benefit) expense                                                     (268,067)       40,267        95,596

       Income tax (benefit) expense                                   (102,810)        7,168        30,779

         Net (loss) income                                        $   (165,257) $     33,099  $     64,817


                                            See notes to consolidated financial statements.

                                              AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                                (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                            Consolidated Statements of Shareholder's Equity
                                                            (in thousands)

                                                                                    Accumulated Other
                                                                                  Comprehensive Income
                                                                               ----------------------------
                                                                               -------------- -------------
                                                      Additional                  Foreign      Unrealized
                                          Common        Paid in    Retained      Currency        Gains
                                            Stock       Capital     Earnings    Translation     (Losses)       Total
                                          ----------- ------------ ----------- -------------- ------------- ------------
                                          ----------- ------------ ----------- -------------- ------------- ------------
 As of December 31, 1999                      $2,500     $215,879    $141,162        $148          ($255)      $359,434
Net income                                                             64,817                                    64,817
Other comprehensive income:
   Unrealized capital gains                                                                          843            843
   Reclassification adjustment for
realized losses included in net
realized capital (losses) gains                                                                      433            433
   Foreign currency translation                                                       (66)                          (66)
                                                                                                            ------------
                                                                                                            ------------
Other comprehensive income                                                                                        1,210
                                                                                                            ------------
                                                                                                            ------------
Comprehensive income                                                                                             66,027
Capital contributions                                      71,450                                                71,450
                                          ----------- ------------ ----------- -------------- ------------- ------------
                                          ----------- ------------ ----------- -------------- ------------- ------------
As of December 31, 2000                        2,500      287,329     205,979          82          1,021        496,911
Net income                                                             33,099                                    33,099
Other comprehensive loss:
   Unrealized capital losses                                                                        (261)          (261)
   Reclassification adjustment for
realized gains included in net
realized capital (losses) gains                                                                      (14)           (14)
   Foreign currency translation                                                       (67)                          (67)
                                                                                                            ------------
                                                                                                            ------------
Other comprehensive loss                                                                                           (342)
                                                                                                            ------------
                                                                                                            ------------
Comprehensive income                                                                                             32,757
Capital contributions                                      48,000                                                48,000
                                          ----------- ------------ ----------- -------------- ------------- ------------
                                          ----------- ------------ ----------- -------------- ------------- ------------
As of December 31, 2001                        2,500      335,329     239,078          15            746        577,668
Net loss                                                             (165,257)                                 (165,257)
Other comprehensive income:
   Unrealized capital gains                                                                       10,434         10,434
   Reclassification adjustment for
realized losses included in net
realized capital (losses) gains                                                                    1,126          1,126
   Foreign currency translation                                                      (630)                         (630)
                                                                                                            ------------
                                                                                                            ------------
Other comprehensive income                                                                                       10,930
                                                                                                            ------------
                                                                                                            ------------
Comprehensive loss                                                                                             (154,327)
Capital contributions                                     259,720                                               259,720
                                          ----------- ------------ ----------- -------------- ------------- ------------
                                          ----------- ------------ ----------- -------------- ------------- ------------
As of December 31, 2002                       $2,500     $595,049     $73,821       $(615)       $12,306       $683,061

Unrealized  capital  gains  (losses)  is shown net of tax  expense  (benefit)  of  $5,618,  ($140)  and $454 for  2002,  2001 and 2000,
respectively.  Reclassification  adjustment for realized losses (gains)  included in net realized  capital  (losses) gains is shown net
of tax expense  (benefit) of $606, ($8) and $233 for 2002, 2001 and 2000,  respectively.  Foreign currency  translation is shown net of
tax benefit of $339, $36 and $36 for 2002, 2001 and 2000, respectively.




                                            See notes to consolidated financial statements.

                                              AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                                (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                                 Consolidated Statements of Cash Flows
                                                            (in thousands)

                                                                         For the Years Ended December 31,
                                                                           2002        2001        2000
Cash flow from operating activities:
   Net (loss) income                                                    $ (165,257) $   33,099  $   64,817
   Adjustments to reconcile net (loss) income to net
     cash (used in) provided by operating activities:
     Amortization and depreciation                                          21,649      13,374       5,758
     Deferral of acquisition costs                                        (244,322)   (209,136)   (495,103)
     Amortization of deferred acquisition costs                            510,059     224,047     184,616
     Deferred tax (benefit) expense                                        (99,071)     46,215      60,023
     Change in unrealized (gains) losses on derivatives                     (5,149)      2,902      (2,936)
     Increase (decrease) in policy reserves                                  3,293     (38,742)     50,892
     (Decrease) increase in net receivable/payable to affiliates           (99,490)    103,496     (72,063)
     Change in net income tax receivable/payable                            37,084       4,083     (58,888)
     Increase in other assets                                               (9,546)    (12,105)    (65,119)
     Decrease (increase) in accrued investment income                          541         472      (1,155)
     Decrease (increase) in reinsurance receivable                           2,286      (1,849)        420
     (Decrease) increase in accounts payable and accrued
expenses                                                                   (59,409)     55,912     (21,550)
     Net realized capital (gains) losses on derivatives                    (26,654)    (14,929)      5,554
     Net realized capital losses (gains) on investments                      9,616        (928)        688
       Net cash (used in) provided by operating activities                (124,370)    205,911    (344,046)

Cash flow from investing activities:
     Purchase of fixed maturity investments                               (388,053)   (462,820)   (380,737)
     Proceeds from sale and maturity of fixed
       maturity investments                                                367,263     390,816     303,736
     Purchase of derivatives                                               (61,998)   (103,533)    (14,781)
     Proceeds from exercise or sale of derivative instruments               88,956     113,051       5,936
     Purchase of shares in equity securities and dividend
reinvestments                                                              (49,713)    (55,430)    (18,136)
     Proceeds from sale of shares in equity securities                      34,220      25,228       8,345
     Purchase of fixed assets                                               (2,423)    (10,773)     (7,348)
     Increase in policy loans                                               (1,000)     (2,813)     (2,476)
       Net cash used in investing activities                               (12,748)   (106,274)   (105,461)

Cash flow from financing activities:
     Capital contribution                                                  259,720      48,000      71,450
     Pay down of surplus notes                                             (34,000)    (15,000)    (20,000)
     (Decrease) increase in future fees payable to ASI, net                (91,223)   (137,355)    358,376
     Deposits to contract owner accounts                                   808,209      59,681     172,441
     Withdrawals from contract owner accounts                             (164,964)   (130,476)   (102,603)
     Change in contract owner accounts, net of investment earnings        (588,315)     62,875     (55,468)
       Net cash provided by (used in) financing activities                 189,427    (112,275)    424,196

       Net increase (decrease) in cash and cash equivalents                 52,309     (12,638)    (25,311)
       Change in foreign currency translation                                 (970)       (103)       (101)
       Cash and cash equivalents at beginning of period                          -      12,741      38,153
       Cash and cash equivalents at end of period                       $   51,339  $        -  $   12,741
     Income taxes (received) paid                                       $  (40,823) $  (43,130) $   29,644
     Interest paid                                                      $   23,967  $   56,831  $  114,394
                                            See notes to consolidated financial statements.

                                              AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                                (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                              Notes to Consolidated Financial Statements
                                                           December 31, 2002
                                                        (dollars in thousands)

1.       ORGANIZATION AND OPERATION

         American Skandia Life Assurance  Corporation ("ASLAC" or the "Company"),  with its principal offices in Shelton,  Connecticut,
         is a wholly-owned  subsidiary of American Skandia,  Inc. ("ASI").  On December 19, 2002, Skandia Insurance Company Ltd. (publ)
         ("SICL"),  an insurance  company  organized  under the laws of the Kingdom of Sweden,  and the ultimate  parent company of the
         Company,  entered into a definitive purchase agreement with Prudential Financial,  Inc., a New Jersey corporation ("Prudential
         Financial"),  whereby  Prudential  Financial  will  acquire the Company and  certain of its  affiliates  (the  "Acquisition").
         Consummation of the  transaction is subject to various  closing  conditions,  including  regulatory  approvals and approval of
         certain  matters by the board of  directors  and  shareholders  of the mutual  funds  advised by American  Skandia  Investment
         Services, Inc. ("ASISI"), a subsidiary of ASI.  The transaction is expected to close during the second quarter of 2003.

         The Company develops long-term savings and retirement  products,  which are distributed  through its affiliated  broker/dealer
         company,  American Skandia  Marketing,  Incorporated  ("ASM").  The Company currently issues term and variable  universal life
         insurance and variable  deferred and immediate  annuities for  individuals  and groups in the United States of America and its
         territories.

         The Company has 99.9% ownership in Skandia Vida, S.A. de C.V.  ("Skandia  Vida"),  which is a life insurance company domiciled
         in  Mexico.  Skandia  Vida had  total  shareholder's  equity  of  $5,023  and  $4,179  as of  December  31,  2002,  and  2001,
         respectively.  Skandia Vida has generated net losses of $2,706,  $2,619 and $2,540 in 2002,  2001 and 2000,  respectively.  As
         part of the  Acquisition,  it is expected  that the Company  will sell its  ownership  interest in Skandia  Vida to SICL.  The
         Company has filed for required  regulatory  approvals from the State of Connecticut  and Mexico related to the sale of Skandia
         Vida.

2.       SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

         A.       Basis of Reporting

                  The  accompanying  consolidated  financial  statements have been prepared in conformity  with  accounting  principles
                  generally  accepted in the United  States  ("U.S.  GAAP").  Skandia  Vida has been  consolidated  in these  financial
                  statements.  Intercompany  transactions  and balances  between the Company and Skandia Vida have been  eliminated  in
                  consolidation.

                  Certain reclassifications have been made to prior year amounts to conform with the current year presentation.

         B.       New Accounting Standard

                  Effective January 1, 2001, the Company adopted Statement of Financial  Accounting  Standards No. 133, "Accounting for
                  Derivative  Instruments  and Hedging  Activities,"  as amended by SFAS 137 and SFAS 138  (collectively  "SFAS  133").
                  Derivative instruments held by the Company consist of equity put option contracts utilized to

                                              AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                                (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                        Notes to Consolidated Financial Statements (continued)

2.       SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

                  manage the economic risks associated with guaranteed  minimum death benefits ("GMDB").  These derivative  instruments
                  are carried at fair value.  Realized and unrealized gains and losses are reported in the  Consolidated  Statements of
                  Income,  together with GMDB claims expense,  as a component of Guaranteed Minimum Death Benefit Claims, Net of Hedge.
                  The adoption of SFAS No. 133 did not have a material effect on the Company's financial statements.

                  Effective  April 1, 2001, the Company  adopted the Emerging  Issues Task Force ("EITF") Issue 99-20,  "Recognition of
                  Interest  Income and  Impairment on Purchased and Retained  Beneficial  Interests in Securitized  Financial  Assets."
                  Under the consensus,  investors in certain asset-backed  securities are required to record changes in their estimated
                  yield on a prospective  basis and to evaluate these  securities for an other than temporary  decline in value. If the
                  fair value of the  asset-backed  security has declined below its carrying  amount and the decline is determined to be
                  other than  temporary,  the security is written  down to fair value.  The adoption of EITF Issue 99-20 did not have a
                  significant effect on the Company's financial statements.

                  In July 2001, the Financial Accounting  Standards Board ("FASB") issued Statement of Financial Accounting  Standards.
                  No. 142  "Accounting  for  Goodwill  and  Intangible  Assets"  ("SFAS  142").  Under the new  standard,  goodwill and
                  intangible  assets  deemed to have  indefinite  lives  will no  longer be  amortized  but will be  subject  to annual
                  impairment  tests in accordance  with the new standard.  Other  intangible  assets will continue to be amortized over
                  their useful lives.

                  The Company applied the new rules on the accounting for goodwill and other intangible  assets in the first quarter of
                  2002.  The adoption of SFAS 142 did not have a significant impact on the Company's financial statements.

         C.       Investments

                  The Company has classified its fixed maturity  investments as  available-for-sale  and, as such,  they are carried at
                  fair value with changes in unrealized gains and losses reported as a component of other comprehensive income.

                  The Company has classified its equity  securities  held in support of a deferred  compensation  plan (see Note 12) as
                  available-for-sale.  Such  investments are carried at fair value with changes in unrealized gains and losses reported
                  as a component of other comprehensive income.

                  Policy loans are carried at their unpaid principal balances.

                  Realized capital gains and losses on disposal of investments are determined by the specific identification method.

                  Other than  temporary  impairment  charges are  determined  based on an analysis  that is  performed on a security by
                  security basis and includes quantitative and qualitative factors.

                                              AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                                (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                        Notes to Consolidated Financial Statements (continued)

2.       SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

         D.       Derivative Instruments

                  The Company uses derivative instruments,  which consist of equity put option contracts, for risk management purposes,
                  and not for trading or  speculation.  The Company  hedges the economic  GMDB exposure  associated  with equity market
                  fluctuations.  As the equity markets decline,  the Company's  exposure to future GMDB claims  increases.  Conversely,
                  as the equity  markets  increase  the  Company's  exposure to future GMDB claims  decreases.  The claims  exposure is
                  reduced by the market value effect of the option contracts purchased.

                  Based on criteria  described in SFAS 133, the Company's fair value hedges do not qualify as  "effective"  hedges and,
                  therefore,  hedge accounting may not be applied.  Accordingly,  the derivative  investments are carried at fair value
                  with changes in unrealized  gains and losses being recorded in income as those changes occur.  As such, both realized
                  and  unrealized  gains and losses are reported in the  Consolidated  Statements of Income,  together with GMDB claims
                  expense, as a component of Guaranteed Minimum Death Benefit Claims, Net of Hedge.

                  As of  December  31,  2002 and 2001,  the  accumulated  difference  between  cost and market  value on the  Company's
                  derivatives was an unrealized gain of $1,434 and an unrealized loss of $3,715,  respectively.  The amount of realized
                  and unrealized  gains (losses) on the Company's  derivatives  recorded during the years ended December 31, 2002, 2001
                  and 2000 was $31,803, $12,027 and ($2,619), respectively.

         E.       Cash Equivalents

                  The Company considers all highly liquid time deposits,  commercial paper and money market mutual funds purchased with
                  a maturity date, at acquisition, of three months or less to be cash equivalents.

                  As of December 31, 2002,  $50 of cash  reflected on the Company's  financial  statements was restricted in compliance
                  with regulatory requirements.

         F.       State Insurance Licenses

                  Licenses to do business  in all states have been  capitalized  and  reflected  at the  purchase  price of $6,000 less
                  accumulated  amortization  of $2,038 at December 31, 2002.  Due to the adoption of SFAS 142, the cost of the licenses
                  is no longer being  amortized but is subjected to an annual  impairment  test.  As of December 31, 2002,  the Company
                  estimated the fair value of the state insurance licenses to be in excess of book value and, therefore,  no impairment
                  charge was required.





                                              AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                                (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                        Notes to Consolidated Financial Statements (continued)

2.       SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

         G.       Income Taxes

                  The Company is  included in the  consolidated  federal  income tax return  filed by Skandia  U.S.  Inc.  and its U.S.
                  subsidiaries.  In  accordance  with the tax sharing  agreement,  the federal  income tax  provision  is computed on a
                  separate return basis as adjusted for consolidated  items.  Pursuant to the terms of this agreement,  the Company has
                  the right to recover  the value of losses  utilized  by the  consolidated  group in the year of  utilization.  To the
                  extent the Company  generates  income in future years,  the Company is entitled to offset future taxes on that income
                  through the application of its loss carry forward generated in the current year.

                  Deferred  income taxes reflect the net tax effects of temporary  differences  between the carrying  amounts of assets
                  and liabilities for financial reporting purposes and the amounts used for income tax purposes.

         H.       Recognition of Revenue and Contract Benefits

                  Revenues for variable  deferred  annuity  contracts  consist of charges  against  contract  owner  account  values or
                  separate accounts for mortality and expense risks,  administration  fees, surrender charges and an annual maintenance
                  fee per  contract.  Revenues for  mortality  and expense  risk  charges and  administration  fees are  recognized  as
                  assessed  against the contract  holder.  Surrender charge revenue is recognized when the surrender charge is assessed
                  against the contract  holder at the time of surrender.  Annual  maintenance  fees are earned  ratably  throughout the
                  year.

                  Benefit  reserves  for the  variable  investment  options on annuity  contracts  represent  the account  value of the
                  contracts and are included in the separate account liabilities.

                  Fee income from mutual fund organizations is recognized when assessed against assets under management.

                  Revenues for variable  immediate  annuity and  supplementary  contracts  with life  contingencies  consist of certain
                  charges against contract owner account values including  mortality and expense risks and  administration  fees. These
                  charges and fees are recognized as revenue as assessed  against the contract  holder.  Benefit  reserves for variable
                  immediate  annuity  contracts  represent the account value of the contracts and are included in the separate  account
                  liabilities.

                  Revenues for the market value adjusted  fixed  investment  option on annuity  contracts  consist of separate  account
                  investment  income reduced by amounts  credited to the contract  holder for interest.  This net spread is included in
                  return credited to contract owners on the  consolidated  statements of income.  Benefit  reserves for these contracts
                  represent the account value of the contracts plus a



                                              AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                                (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                        Notes to Consolidated Financial Statements (continued)

2.       SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

                  market value  adjustment,  and are included in the general account reserve for future policy and contract benefits to
                  the extent in excess of the separate account assets, typically for the market value adjustment at the reporting date.

                  Revenues for fixed immediate  annuity and fixed  supplementary  contracts without life  contingencies  consist of net
                  investment  income,  reported as a component of return  credited to contract  owners.  Revenues  for fixed  immediate
                  annuity contracts with life  contingencies  consist of single premium payments  recognized as annuity  considerations
                  when  received.  Benefit  reserves for these  contracts  are based on  applicable  actuarial  standards  with assumed
                  interest  rates that vary by issue  year and are  included  in the  general  account  reserve  for future  policy and
                  contract benefits.  Assumed interest rates ranged from 6.25% to 8.25% at December 31, 2002 and 2001.

                  Revenues for variable life insurance  contracts  consist of charges against contract owner account values or separate
                  accounts for  mortality  and expense risk fees,  administration  fees,  cost of insurance  fees,  taxes and surrender
                  charges.  Certain  contracts also include charges  against  premium to pay state premium taxes.  All of these charges
                  are recognized as revenue when assessed  against the contract  holder.  Benefit  reserves for variable life insurance
                  contracts represent the account value of the contracts and are included in the separate account liabilities.

         I.       Deferred Acquisition Costs

                  The costs of acquiring new business,  which vary with and are primarily related to new business generated,  are being
                  deferred,  net of reinsurance.  These costs include commissions,  purchase credits,  costs of contract issuance,  and
                  certain selling expenses that vary with production.

                  The Company uses the retrospective  deposit method for amortizing deferred  acquisition costs. This method results in
                  deferred  acquisition  costs being  amortized in proportion to expected  gross profits,  from  surrender  charges and
                  policy and asset based fees,  net of operating  and claim  costs.  The  deferred  acquisition  cost asset is adjusted
                  retrospectively  and prospectively  when estimates of current and future gross profits to be realized from a group of
                  products are revised.  Critical assumptions in estimating gross profits include those for surrenders,  long-term fund
                  growth rate,  expenses and death  benefits.  The long-term fund growth rate, in large part,  determines the estimated
                  future asset  levels on which the most  significant  revenues are based.  The  Company's  long-term  fund growth rate
                  assumption is 8% (net of charges  assessed  against the underlying  mutual fund,  but before charges  assessed at the
                  separate account and contract  level).  When current period actual asset growth is greater or less than the Company's
                  long-term  expectation,  the Company adjusts the short-term asset growth rate to a level that will allow the Company,
                  in the  short-term,  to resume the  long-term  asset growth rate  expectation.  The  short-term  asset growth rate is
                  subject to constraints surrounding actual market conditions.


                                              AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                                (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                        Notes to Consolidated Financial Statements (continued)

2.       SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

                  Details of deferred acquisition costs and related amortization for the years ended December 31, are as follows:

                                                                 2002            2001            2000
                  Balance at beginning of year              $   1,383,281   $   1,398,192   $   1,087,705
                  Acquisition costs deferred during the
                       year                                       244,322         209,136         495,103
                  Acquisition costs amortized during the
                       year                                      (510,059)       (224,047)       (184,616)
                  Balance at end of year                    $   1,117,544   $   1,383,281   $   1,398,192


                  As asset growth rates, during 2002 and 2001, have been far below the Company's long-term  assumption,  the adjustment
                  to the  short-term  asset growth rate had risen to a level,  before being capped,  that in  management's  opinion was
                  excessive in the current market  environment.  Based on an analysis of those short-term  rates, the related estimates
                  of future gross profits and an impairment  study,  management of the Company  determined  that the  short-term  asset
                  growth rate should be reset to the level of the long-term  growth rate  expectation  as of September  30, 2002.  This
                  resulted in an acceleration of amortization of approximately $206,000.

                  Throughout the year, the Company also updated its future  estimated  gross profits with respect to certain  mortality
                  assumptions  reflecting  actual  experience and the decline in the equity markets  resulting in additional  increased
                  amortization of approximately $72,000.

         J.       Reinsurance

                  The Company cedes reinsurance  under modified  co-insurance  arrangements.  These  reinsurance  arrangements  provide
                  additional  capacity for growth in supporting the cash flow strain from the Company's  variable  annuity and variable
                  life insurance business.  The reinsurance is effected under quota share contracts.

                  At December 31, 2002 and 2001, in accordance with the provisions of the modified coinsurance agreements,  the Company
                  accrued approximately $5,447 and $7,733,  respectively,  for amounts receivable from favorable reinsurance experience
                  on certain blocks of variable annuity business.

         K.       Translation of Foreign Currency

                  The financial  position and results of operations of Skandia Vida are measured using local currency as the functional
                  currency.  Assets and  liabilities  are  translated  at the exchange rate in effect at each  year-end.  Statements of
                  income and changes in  shareholder's  equity accounts are translated at the average rate prevailing  during the year.
                  Translation  adjustments  arising  from the use of differing  exchange  rates from period to period are reported as a
                  component of other comprehensive income.

                                              AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                                (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                        Notes to Consolidated Financial Statements (continued)

2.       SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

         L.       Separate Accounts

                  Assets and  liabilities  in separate  accounts are included as separate  captions in the  consolidated  statements of
                  financial  condition.  Separate account assets consist  principally of long term bonds,  investments in mutual funds,
                  short-term  securities and cash and cash  equivalents,  all of which are carried at fair value.  The  investments are
                  managed predominately through ASISI,  utilizing various fund managers as sub-advisors.  The remaining investments are
                  managed by independent  investment  firms. The contract holder has the option of directing funds to a wide variety of
                  investment  options,  most of which invest in mutual funds. The investment risk on the variable portion of a contract
                  is borne by the contract  holder.  Fixed  options with minimum  guaranteed  interest  rates are also  available.  The
                  Company bears the credit risk associated with the investments that support these fixed options.

                  Included in Separate  Account  liabilities  are reserves of $1,828,048  and $1,092,944 at December 31, 2002 and 2001,
                  respectively,  relating to deferred  annuity  investment  options for which the contract holder is guaranteed a fixed
                  rate of return.  These reserves are calculated using the Commissioners  Annuity Reserve  Valuation  Method.  Separate
                  Account  assets of  $1,828,048  and  $1,092,944  at December  31, 2002 and 2001,  respectively,  consisting  of fixed
                  maturities, equity securities,  short-term securities, cash and cash equivalents,  accrued investment income, accrued
                  liabilities  and amounts due to/from the General Account are held in support of these annuity  obligations,  pursuant
                  to state regulation.

                  Included in the general  account,  within  Reserves  for Future  Policy and  Contract  Benefits,  is the market value
                  adjustment  associated with the guaranteed,  fixed rate investment  options,  assuming the market value adjustment at
                  the reporting date.

                  Net investment  income (including net realized capital gains and losses) and interest credited to contract holders on
                  separate account assets are not separately reflected in the Consolidated Statements of Income.

         M.       Unearned Performance Credits

                  The Company defers certain bonus credits  applied to contract holder  deposits.  The credit is reported as a contract
                  holder  liability  within separate  account  liabilities and the deferred expense is reported as a component of other
                  assets.  As the contract  holder must keep the contract  in-force for 10 years to earn the bonus credit,  the Company
                  amortizes  the deferred  expense on a  straight-line  basis over 10 years.  If the  contract  holder  surrenders  the
                  contract or the  contract  holder  dies prior to the end of 10 years,  the bonus  credit is returned to the  Company.
                  This component of the bonus credit is amortized in proportion to expected  surrenders  and mortality.  As of December
                  31, 2002 and 2001, the unearned performance credit asset was $83,288 and $89,234, respectively.


                                              AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                                (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                        Notes to Consolidated Financial Statements (continued)

2.       SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

         N.       Estimates

                  The  preparation of financial  statements in conformity  with U.S. GAAP requires that  management  make estimates and
                  assumptions  that affect the reported  amount of assets and  liabilities at the date of the financial  statements and
                  the reported  amounts of revenues and expenses  during the  reporting  period.  The more  significant  estimates  and
                  assumptions  are related to deferred  acquisition  costs and involve  estimates of future policy  lapses,  investment
                  returns and maintenance expenses.  Actual results could differ from those estimates.

3.       INVESTMENTS

         The  amortized  cost,  gross  unrealized  gains and  losses  and fair  value of fixed  maturities  and  investments  in equity
         securities  as of  December  31,  2002 and 2001 are shown  below.  All  securities  held at  December  31,  2002 and 2001 were
         publicly traded.

         Investments in fixed maturities as of December 31, 2002 consisted of the following:

                                                                     Gross          Gross
                                                    Amortized     Unrealized     Unrealized
                                                      Cost           Gains         Losses       Fair Value
         U.S. Government obligations              $    270,969   $    15,658       $    (78)   $    286,549
         Obligations of state and political
           subdivisions                                    253             9             (1)            261
         Corporate securities                          108,200         3,631            (40)        111,791
              Totals                              $    379,422   $    19,298       $   (119)   $    398,601


         The  amortized  cost and fair value of fixed  maturities,  by  contractual  maturity,  at December  31, 2002 are shown  below.
         Actual maturities may differ from contractual maturities due to call or prepayment provisions.

                                                       Amortized
                                                          Cost      Fair Value
         Due in one year or less                      $    12,793   $    12,884
         Due after one through five years                 165,574       171,830
         Due after five through ten years                 186,609       198,913
         Due after ten years                               14,446        14,974
           Total                                      $   379,422   $   398,601








                                              AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                                (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                        Notes to Consolidated Financial Statements (continued)

3.       INVESTMENTS (continued)

         Investments in fixed maturities as of December 31, 2001 consisted of the following:

                                                                     Gross          Gross
                                                    Amortized     Unrealized     Unrealized
                                                      Cost           Gains         Losses       Fair Value
         U.S. Government obligations                 $198,136         $2,869          $(413)      $200,592
         Obligations of state and political
           subdivisions                                   252              8              -            260
         Corporate securities                         158,494          4,051           (566)       161,979
              Totals                                 $356,882         $6,928          $(979)      $362,831

         Proceeds  from sales of fixed  maturities  during 2002,  2001 and 2000 were  $367,213,  $386,816 and  $302,632,  respectively.
         Proceeds from maturities during 2002, 2001 and 2000 were $50, $4,000 and $1,104, respectively.

         The cost, gross unrealized gains/losses and fair value of investments in equity securities at December 31 are shown below:

                                                           Gross          Gross
                                                        Unrealized     Unrealized        Fair
                                            Cost           Gains         Losses          Value
         2002                             $ 52,017         $ 136        $    (384)     $ 51,769
         2001                             $  49,886        $ 122        $ (4,925)      $ 45,083

         Net realized  investment gains (losses),  determined on a specific  identification  basis, were as follows for the years ended
         December 31:

                                                          2002          2001           2000
         Fixed maturities:
           Gross gains                                $    8,213      $  8,849       $  1,002
           Gross losses                                   (4,468)       (4,387)        (3,450)

         Investment in equity securities:
           Gross gains                                        90           658          1,913
           Gross losses                                  (13,451)       (4,192)          (153)

              Totals                                  $   (9,616)     $    928       $   (688)

         During 2002, the Company  determined that certain amounts of its investment in equity  securities were other than  temporarily
         impaired and, accordingly, recorded a loss of $3,769.

         As of December 31, 2002, the Company did not own any  investments in fixed maturity  securities  whose carrying value exceeded
         10% of the Company's equity.




                                              AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                                (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                        Notes to Consolidated Financial Statements (continued)

3.       INVESTMENTS (continued)

         As of December 31, 2002, the following fixed maturities were restricted in compliance with regulatory requirements:

         Security                                                      Fair Value
         U.S. Treasury Note, 6.25%, February 2003                           $4,345
         U.S. Treasury Note, 3.00%, November 2003                              183
         Puerto Rico Commonwealth, 4.60%, July 2004                            210
         Puerto Rico Commonwealth, 4.875%, July 2023                            52

4.       FAIR VALUES OF FINANCIAL INSTRUMENTS

         The methods and assumptions used to determine the fair value of financial instruments are as follows:

         Fair values of fixed  maturities  with active markets are based on quoted market prices.  For fixed  maturities  that trade in
         less active markets, fair values are obtained from an independent pricing service.

         Fair values of equity securities are based on quoted market prices.

         The fair value of derivative instruments is determined based on the current value of the underlying index.

         The  carrying  value of cash and cash  equivalents  (cost)  approximates  fair  value  due to the  short-term  nature of these
         investments.

         The carrying value of policy loans approximates fair value.

         Fair value of future fees payable to ASI are determined on a discounted  cash flow basis,  using best estimate  assumptions of
         lapses, mortality, free withdrawals and a long-term fund growth rate of 8% on the Company's assets under management.

         The carrying value of short-term borrowings (cost) approximates fair value due to the short-term nature of these liabilities.

         Fair value of surplus notes are  determined  based on a discounted  cash flow basis with a projected  payment of principal and
         all accrued interest at the maturity date (see Note 14 for payment restrictions).



                                              AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                                (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                        Notes to Consolidated Financial Statements (continued)

4.       FAIR VALUES OF FINANCIAL INSTRUMENTS (continued)

         The fair values and carrying values of financial instruments at December 31, 2002 and 2001 are as follows:

                                                   December 31, 2002                December 31, 2001
                                             Fair Value     Carrying Value    Fair Value     Carrying Value
                                           -------------- ------------------ ------------- ------------------
                                           -------------- ------------------ ------------- ------------------
        Assets
        Fixed Maturities                         $398,601           $398,601      $362,831           $362,831
        Equity Securities                          51,769             51,769        45,083             45,083
        Derivative Instruments                     10,370             10,370         5,525              5,525
        Policy Loans                                7,559              7,559         6,559              6,559

        Liabilities
        Future Fees Payable to ASI                429,773            708,249       546,357            799,472
        Short-term Borrowing                       10,000             10,000        10,000             10,000
        Surplus Notes and accrued
           interest of $29,230 and
           $25,829 in 2002 and 2001,
           respectively                           140,777            139,230       174,454            169,829

5.       NET INVESTMENT INCOME

         The sources of net investment income for the years ended December 31 were as follows:

                                                          2002          2001           2000
         Fixed maturities                              $  18,015     $  18,788      $  13,502
         Cash and cash equivalents                         1,116           909          5,209
         Equity securities                                   809           622             99
         Policy loans                                        403           244             97
         Total investment income                          20,343        20,563         18,907
         Investment expenses                                (711)         (437)          (312)
         Net investment income                         $19,632       $  20,126      $  18,595


6.       INCOME TAXES

         The significant components of income tax expense for the years ended December 31 were as follows:

                                                            2002          2001         2000
         Current tax benefit                            $    (3,739)   $  (39,047)  $   (29,244)
         Deferred tax expense, excluding operating
           loss carryforwards                                35,915        60,587        60,023
         Deferred tax benefit for operating and
           capital loss carryforwards                      (134,986)      (14,372)            -
              Total income tax (benefit) expense        $  (102,810)   $    7,168   $    30,779



                                              AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                                (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                             Notes to Consolidated Financial Statements (continued)

6.       INCOME TAXES (continued)

         Deferred tax assets (liabilities) include the following at December 31:

                                                           2002          2001
         Deferred tax assets:
           GAAP to tax reserve differences             $   165,348   $   241,503
           Future fees payable to ASI                       21,475        63,240
           Deferred compensation                            20,603        20,520
           Net operating loss carry forward                147,360        14,372
           Other                                             6,530        17,276
              Total deferred tax assets                    361,316       356,911

         Deferred tax liabilities:
           Deferred acquisition costs, net                (312,933)     (404,758)
           Net unrealized gains on fixed
              maturity securities                           (6,713)       (2,082)
           Other                                            (3,464)       (5,051)
              Total deferred tax liabilities              (323,110)     (411,891)
                Net deferred tax asset (liability)     $    38,206   $   (54,980)

         In  accordance  with SFAS 109, the Company has  performed  an analysis of its  deferred  tax assets to assess  recoverability.
         Looking at a variety  of items,  most  notably,  the timing of the  reversal  of  temporary  items and future  taxable  income
         projections, the Company determined that no valuation allowance is needed.

         The income tax (benefit)  expense was different from the amount computed by applying the federal  statutory tax rate of 35% to
         pre-tax income from continuing operations as follows:

                                                                   2002            2001           2000
         (Loss) income before taxes
           Domestic                                           $   (265,361)   $   42,886      $   98,136
           Foreign                                                  (2,706)       (2,619)         (2,540)
           Total                                                  (268,067)       40,267          95,596
           Income tax rate                                              35%           35%             35%
         Tax (benefit) expense at federal statutory income
           tax rate                                                (93,823)       14,093          33,459

         Tax effect of:
           Dividend received deduction                             (12,250)       (8,400)         (7,350)
           Losses of foreign subsidiary                                947           917             889
           Meals and entertainment                                     603           603             841
           State income taxes                                            -           (62)           (524)
           Federal provision to return differences                     709          (177)          3,235
           Other                                                     1,004           194             229
              Income tax (benefit) expense                    $   (102,810)   $    7,168      $   30,779

         The Company's net operating loss carry forwards,  totaling  approximately $421,029 (pre-tax) at December 31, 2002, will expire
         in 2016 and 2017.

                                              AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                                (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                        Notes to Consolidated Financial Statements (continued)

7.       COST ALLOCATION AGREEMENTS WITH AFFILIATES

         Certain  operating  costs  (including  rental of office space,  furniture,  and equipment) have been charged to the Company at
         cost by American Skandia Information  Services and Technology  Corporation  ("ASIST"),  an affiliated company.  ASLAC signed a
         written  service  agreement with ASIST for these services  executed and approved by the  Connecticut  Insurance  Department in
         1995.  This agreement  automatically  continues in effect from year to year and may be terminated by either party upon 30 days
         written notice.  The Company has also paid and charged  operating  costs to several of its  affiliates.  The total cost to the
         Company  for these items was  $8,177,  $6,179 and $13,974 in 2002,  2001 and 2000,  respectively.  Income  received  for these
         items was approximately $13,052, $13,166 and $11,186 in 2002, 2001 and 2000, respectively.

         Allocated  depreciation expense was $7,440,  $8,764 and $9,073 in 2002, 2001 and 2000,  respectively.  Allocated lease expense
         was  $5,808,  $6,517 and $5,606 in 2002,  2001 and 2000,  respectively.  Allocated  sub-lease  rental  income,  recorded  as a
         reduction to lease  expense,  was $738, $30 and $0 in 2002,  2001 and 2000,  respectively.  Assuming that the written  service
         agreement  between ASLAC and ASIST  continues  indefinitely,  ASLAC's  allocated  future  minimum lease payments and sub-lease
         receipts per year and in aggregate as of December 31, 2002 are as follows:

                                                                       Lease         Sub-Lease
                                  2003                            $     4,847      $     1,616
                                  2004                                  5,275            1,773
                                  2005                                  5,351            1,864
                                  2006                                  5,328            1,940
                                  2007                                  5,215            1,788
                                  2008 and thereafter                  19,629            7,380
                                  Total                           $    45,645      $    16,361


         Beginning in 1999,  the Company was  reimbursed by ASM for certain  distribution  related costs  associated  with the sales of
         business  through an investment  firm where ASM serves as an introducing  broker dealer.  Under this  agreement,  the expenses
         reimbursed were $8,255,  $6,610 and $6,064 in 2002,  2001 and 2000,  respectively.  As of December 31, 2002 and 2001,  amounts
         receivable under this agreement were approximately $458 and $639, respectively.












                                              AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                                (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                        Notes to Consolidated Financial Statements (continued)

8.       FUTURE FEES PAYABLE TO ASI

         In a series of  transactions  with ASI,  the  Company  transferred  certain  rights to  receive a portion  of future  fees and
         contract charges expected to be realized on designated blocks of deferred annuity contracts.

         The proceeds  from the  transfers  have been recorded as a liability  and are being  amortized  over the  remaining  surrender
         charge  period of the  designated  contracts  using the  interest  method.  The Company did not  transfer the right to receive
         future fees and charges after the expiration of the surrender charge period.

         In  connection  with  these  transactions,  ASI,  through  special  purpose  trusts,  issued  collateralized  notes in private
         placements, which are secured by the rights to receive future fees and charges purchased from the Company.

         Under the terms of the securitization  purchase  agreements,  the rights  transferred  provide for ASI to receive a percentage
         (60%,  80% or 100%  depending on the  underlying  commission  option) of future  mortality and expense  charges and contingent
         deferred  sales  charges,  after  reinsurance,  expected to be realized  over the  remaining  surrender  charge  period of the
         designated  contracts  (generally 6 to 8 years).  The  liability  for future fees payable to ASI at the balance  sheet date is
         based on the consideration  received less principal repayments according to amortization  schedules that were developed at the
         inception of the  transactions.  If actual  mortality and expense charges and contingent  deferred sales charges are less than
         those  projected in the original  amortization  schedules,  calculated  on a  transaction  by  transaction  basis,  ASI has no
         recourse against the Company.  As account values associated with the designated  contracts have declined,  consistent with the
         overall  decline in the equity  markets,  current  mortality  and  expense  charges  have been lower than  expected on certain
         transactions  and it is likely that future  mortality  and expense  charges,  on those same  transactions,  will be lower than
         originally  projected.  As a result,  the ultimate cash flows associated with these transactions that will transfer to ASI may
         be lower than the current carrying amount of the liability (see Note 4).

         On April 12, 2002,  the Company  entered into a new  securitization  purchase  agreement  with ASI.  This  transaction  covers
         designated  blocks of business  issued from November 1, 2000 through  December 31, 2001.  The  estimated  present value of the
         transaction at April 12, 2002, using a discount rate of 6.00%, was $101,713.

         Payments,  representing fees and charges in the aggregate amount, of $186,810,  $207,731 and $219,523 were made by the Company
         to ASI in 2002, 2001 and 2000,  respectively.  Related interest expense of $828,  $59,873 and $70,667 has been included in the
         consolidated statements of income for 2002, 2001 and 2000, respectively.

         The  Commissioner  of the State of  Connecticut  has approved the transfer of future fees and charges;  however,  in the event
         that the Company becomes subject to an order of liquidation or  rehabilitation,  the  Commissioner has the ability to restrict
         the payments due to ASI, into a restricted account, under the Purchase Agreement subject to certain terms and conditions.

                                              AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                                (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                        Notes to Consolidated Financial Statements (continued)

8.       FUTURE FEES PAYABLE TO ASI (continued)

         The present values of the transactions as of the respective effective date were as follows:

                              Closing      Effective        Contract Issue        Discount       Present
           Transaction         Date          Date               Period              Rate          Value

             1996-1           12/17/96        9/1/96        1/1/94 - 6/30/96        7.5%          $50,221
             1997-1            7/23/97        6/1/97        3/1/96 - 4/30/97        7.5%           58,767
             1997-2           12/30/97       12/1/97        5/1/95 - 12/31/96       7.5%           77,552
             1997-3           12/30/97       12/1/97        5/1/96 - 10/31/97       7.5%           58,193
             1998-1            6/30/98        6/1/98        1/1/97 - 5/31/98        7.5%           61,180
             1998-2           11/10/98       10/1/98        5/1/97 - 8/31/98        7.0%           68,573
             1998-3           12/30/98       12/1/98        7/1/96 - 10/31/98       7.0%           40,128
             1999-1            6/23/99        6/1/99        4/1/94 - 4/30/99        7.5%          120,632
             1999-2           12/14/99       10/1/99       11/1/98 - 7/31/99        7.5%          145,078
             2000-1            3/22/00        2/1/00        8/1/99 - 1/31/00        7.5%          169,459
             2000-2            7/18/00        6/1/00        2/1/00 - 4/30/00        7.25%          92,399
             2000-3           12/28/00       12/1/00        5/1/00 - 10/31/00       7.25%         107,291
             2000-4           12/28/00       12/1/00        1/1/98 - 10/31/00       7.25%         107,139
             2002-1            4/12/02        3/1/02       11/1/00 - 12/31/01       6.00%         101,713

         Payments of future fees payable to ASI, according to original amortization schedules, as of December 31, 2002 are as follows:

                                          Year         Amount

                                          2003      $   186,854
                                          2004          171,093
                                          2005          147,902
                                          2006          117,761
                                          2007           66,270
                                          2008           18,369
                                          Total     $   708,249


                                              AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                                (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                        Notes to Consolidated Financial Statements (continued)

9.       LEASES

         The Company  entered into an eleven year lease  agreement  for office space in  Westminster,  Colorado,  effective  January 1,
         2001.  Lease expense for 2002 and 2001 was $2,583 and $1,602,  respectively.  Sub-lease  rental income was $227 in 2002 and $0
         in 2001.  Future  minimum  lease  payments  and  sub-lease  receipts  per year and in aggregate as of December 31, 2002 are as
         follows:

                                                                       Lease           Sub-Lease
                                   2003                          $    1,913         $      426
                                   2004                               1,982                455
                                   2005                               2,050                500
                                   2006                               2,050                533
                                   2007                               2,050                222
                                   2008 and thereafter                8,789                  0
                                   Total                         $   18,834         $    2,136


10.      RETAINED EARNINGS AND DIVIDEND RESTRICTIONS

         Statutory basis shareholder's equity was $279,957 and $226,780 at December 31, 2002 and 2001, respectively.

         The Company  incurred  statutory  basis net losses in 2002 of $192,474  due  primarily to  significant  declines in the equity
         markets,  increasing GMDB reserves  calculated on a statutory  basis.  Statutory  basis net losses for 2001 were $121,957,  as
         compared to income of $11,550 in 2000.

         Under various state insurance  laws, the maximum amount of dividends that can be paid to  shareholders  without prior approval
         of the state  insurance  department is subject to  restrictions  relating to statutory  surplus and net gain from  operations.
         For 2003, no amounts may be distributed without prior approval.

11.      STATUTORY ACCOUNTING PRACTICES

         The Company  prepares its statutory basis  financial  statements in accordance  with  accounting  practices  prescribed by the
         State of Connecticut  Insurance  Department.  Prescribed  statutory  accounting practices include publications of the National
         Association of Insurance Commissioners (NAIC), as well as state laws, regulations and general administrative rules.

         The NAIC adopted the  Codification of Statutory  Accounting  Principles  (Codification)  in March 1998. The effective date for
         codification  was January 1, 2001. The Company's  state of domicile,  Connecticut,  has adopted  codification  and the Company
         has made the necessary changes in its statutory  accounting and reporting required for  implementation.  The overall impact of
         adopting  codification in 2001 was a one-time,  cumulative change in accounting benefit recorded directly in statutory surplus
         of $12,047.

         In addition,  during 2001, based on a recommendation from the State of Connecticut Insurance  Department,  the Company changed
         its statutory method of accounting for its

                                              AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                                (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                        Notes to Consolidated Financial Statements (continued)

11.      STATUTORY ACCOUNTING PRACTICES (continued)

         liability  associated  with  securitized  variable  annuity  fees.  Under the new  method of  accounting,  the  liability  for
         securitized  fees is established  consistent with the method of accounting for the liability  associated with variable annuity
         fees ceded under  reinsurance  contracts.  This equates to the statutory  liability at any  valuation  date being equal to the
         Commissioners  Annuity  Reserve  Valuation  Method  (CARVM) offset related to the  securitized  contracts.  The impact of this
         change in accounting,  representing  the difference in the liability  calculated under the old method versus the new method as
         of January 1, 2001,  was  reported as a  cumulative  effect of change in  accounting  benefit  recorded  directly in statutory
         surplus of approximately $20,215.

         In 2001, the Company, in agreement with the Connecticut Insurance  Department,  changed its reserving methodology to recognize
         free  partial  withdrawals  and to reserve  on a  "continuous"  rather  than  "curtate"  basis.  The impact of these  changes,
         representing  the difference in reserves  calculated  under the new methods versus the old methods,  was recorded  directly to
         surplus as changes in reserves on account of  valuation  basis.  This  resulted  in an increase to the  unassigned  deficit of
         approximately $40,511.

         Effective  January 1, 2002, the Company  adopted  Statement of Statutory  Accounting  Principles No. 82,  "Accounting  for the
         Costs of Computer  Software  Developed  or Obtained  for Internal Use and Web Site  Development  Costs"  ("SSAP 82").  SSAP 82
         requires the  capitalization  of certain costs  incurred in  connection  with  developing or obtaining  internal use software.
         Prior to the adoption of SSAP 82, the Company  expensed all internal use software  related costs as incurred.  The Company has
         identified and capitalized  $5,935 of costs  associated with internal use software as of January 1, 2002 and is amortizing the
         applicable costs on a straight-line  basis over a three year period.  The costs  capitalized as of January 1, 2002 resulted in
         a direct increase to surplus.  Amortization expense for the year ended December 31, 2002 was $757.

12.      EMPLOYEE BENEFITS

         The Company has a 401(k) plan for which  substantially  all employees are eligible.  Under this plan,  the Company  provides a
         50% match on employees'  contributions up to 6% of an employee's  salary (for an aggregate match of up to 3% of the employee's
         salary).  Additionally,  the Company may contribute  additional  amounts based on  profitability of the Company and certain of
         its  affiliates.  Expenses  related  to this  program  in 2002,  2001 and 2000 were $719,  $2,738  and  $3,734,  respectively.
         Company  contributions  to this plan on behalf of the  participants  were  $921,  $2,549  and  $4,255 in 2002,  2001 and 2000,
         respectively.

         The Company has a deferred  compensation  plan,  which is available to the field marketing staff and certain other  employees.
         Expenses related to this program in 2002, 2001 and 2000 were $3,522,  $1,615 and $1,030,  respectively.  Company contributions
         to this plan on behalf of the participants were $5,271, $1,678 and $2,134 in 2002, 2001 and 2000, respectively.

         The  Company  and  certain  affiliates  cooperatively  have a  long-term  incentive  program  under which units are awarded to
         executive  officers  and other  personnel.  The Company and  certain  affiliates  also have a profit  sharing  program,  which
         benefits all employees

                                              AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                                (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                        Notes to Consolidated Financial Statements (continued)

12.      EMPLOYEE BENEFITS (continued)

         below the  officer  level.  These  programs  consist  of  multiple  plans  with new plans  instituted  each  year.  Generally,
         participants  must remain  employed by the  Company or its  affiliates  at the time such units are payable in order to receive
         any payments  under the programs.  The accrued  liability  representing  the value of these units was $7,083 and $13,645 as of
         December 31, 2002 and 2001,  respectively.  Expenses  (income)  related to these programs in 2002, 2001 and 2000, were $1,471,
         ($9,842) and $2,692,  respectively.  Payments  under these  programs were $8,033,  $8,377 and $13,697 in 2002,  2001 and 2000,
         respectively.

13.      FINANCIAL REINSURANCE

         The Company cedes  insurance to other  insurers in order to fund the cash strain  generated from  commission  costs on current
         sales and to limit its risk exposure.  The Company uses modified  coinsurance  reinsurance  arrangements whereby the reinsurer
         shares in the experience of a specified  book of business.  These  reinsurance  transactions  result in the Company  receiving
         from the reinsurer an upfront ceding  commission on the book of business ceded in exchange for the reinsurer  receiving in the
         future,  the future fees  generated  from that book of  business.  Such  transfer  does not relieve the Company of its primary
         liability and, as such,  failure of reinsurers to honor their  obligation  could result in losses to the Company.  The Company
         reduces this risk by evaluating the financial condition and credit worthiness of reinsurers.

         The effect of reinsurance for the 2002, 2001 and 2000 was as follows:

        2002                                                            Gross          Ceded           Net
        Annuity and life insurance charges and fees                 $   406,272     $   (36,268)  $   370,004
        Return credited to contract owners                          $     5,221     $       (25)  $     5,196
        Underwriting, acquisition and other insurance
        expenses (deferal of acquisition costs)                     $   154,588     $    34,140   $   188,728
        Amortization of deferred acquisition costs                  $   542,945     $   (32,886)  $   510,059


        2001
        Annuity and life insurance charges and fees                 $   430,914     $   (42,218)  $   388,696
        Return credited to contract owners                          $     5,704     $        92   $     5,796
        Underwriting, acquisition and other insurance
        expenses (deferral of acquisition costs)                    $   163,677     $    33,078   $   196,755
        Amortization of deferred acquisition costs                  $   231,290     $    (7,243)  $   224,047


        2000
        Annuity and life insurance charges and fees                 $   473,318     $   (48,740)  $   424,578
        Return credited to contract owners                          $     8,540     $       (77)  $     8,463
        Underwriting, acquisition and other insurance
        expenses (deferral of acquisition costs)                    $   108,399     $    42,198   $   150,597
        Amortization of deferred acquisition costs                  $   205,174     $   (20,558)  $   184,616

         In December 2000,  the Company  entered into a modified  coinsurance  agreement with SICL covering  certain  contracts  issued
         since January 1996.  The impact of this treaty to the

                                              AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                                (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                        Notes to Consolidated Financial Statements (continued)

13.      FINANCIAL REINSURANCE (continued)

         Company was pre-tax  (loss)  income of  ($4,137),  $8,394 and $23,341 in 2002,  2001 and 2000,  respectively.  At December 31,
         2002 and 2001, $675 and $1,137, respectively, was receivable from SICL under this agreement.

14.      SURPLUS NOTES

         The Company has issued  surplus  notes to ASI in exchange  for cash.  Surplus  notes  outstanding  as of December 31, 2002 and
         2001, and interest expense for 2002, 2001 and 2000 were as follows:

                                                     Liability as of
                                                      December 31,                    Interest Expense
                                   Interest                                            For the Years
            Note Issue Date          Rate          2002          2001          2002         2001         2000
         ----------------------    ---------     ----------    ----------    ---------    ---------    ---------
         ----------------------    ---------     ----------

         February 18, 1994           7.28%               -             -             -            -          732
         March 28, 1994              7.90%               -             -             -            -          794
         September 30, 1994          9.13%               -             -             -        1,282        1,392
         December 19, 1995           7.52%               -        10,000           520          763          765
         December 20, 1995           7.49%               -        15,000           777        1,139        1,142
         December 22, 1995           7.47%               -         9,000           465          682          684
         June 28, 1996               8.41%          40,000        40,000         3,411        3,411        3,420
         December 30, 1996           8.03%          70,000        70,000         5,699        5,699        5,715
                                                 ----------    ----------    ---------    ---------    ---------
                                                 ----------    ----------    ---------    ---------    ---------

         Total                                    $110,000      $144,000       $10,872      $12,976      $14,644
                                                 ==========    ==========    =========    =========    =========

         On September 6, 2002,  surplus notes for $10,000,  dated  December 19, 1995,  $15,000,  dated  December 20, 1995,  and $9,000,
         dated  December 22,  1995,  were  repaid.  On December 3, 2001, a surplus  note,  dated  September  30, 1994,  for $15,000 was
         repaid.  On December 27, 2000,  surplus notes for $10,000,  dated February 18, 1994, and $10,000,  dated March 28, 1994,  were
         repaid.  All surplus notes mature seven years from the issue date.

         Payment of interest and repayment of principal for these notes is subject to certain  conditions  and require  approval by the
         Insurance  Commissioner  of the State of Connecticut.  At December 31, 2002 and 2001,  $29,230 and $25,829,  respectively,  of
         accrued interest on surplus notes was not permitted for payment under these criteria.

15.      SHORT-TERM BORROWING

         The  Company  had a  $10,000  short-term  loan  payable  to ASI at  December  31,  2002 and 2001 as part of a  revolving  loan
         agreement.  The loan had an interest  rate of 1.97% and matured on January 13,  2003.  The loan was  subsequently  rolled over
         with a new  interest  rate of 1.82% and a new  maturity  date of March 13,  2003.  The loan was further  extended to April 30,
         2003 and a new interest rate of 1.71%.  The total  related  interest  expense to the Company was $271,  $522 and $687 in 2002,
         2001 and 2000, respectively.  Accrued interest payable was $10 and $113 as of December 31, 2002 and 2001, respectively.



                                              AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                                (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                        Notes to Consolidated Financial Statements (continued)

15.      SHORT-TERM BORROWING (continued)

         On January 3, 2002,  the Company  entered  into a $150,000  credit  facility  with ASI.  This credit  facility  terminates  on
         December 31, 2005 and bears  interest at the offered rate in the London  interbank  market (LIBOR) plus 0.35 percent per annum
         for the relevant  interest  period.  Interest  expense related to these  borrowings was $2,243 for the year ended December 31,
         2002.  As of December 31, 2002, no amount was outstanding under this credit facility.

16.      CONTRACT WITHDRAWAL PROVISIONS

         Approximately  99% of the Company's  separate account  liabilities are subject to discretionary  withdrawal by contract owners
         at market value or with market value  adjustment.  Separate  account assets,  which are carried at fair value, are adequate to
         pay such  withdrawals,  which are generally  subject to surrender  charges ranging from 10% to 1% for contracts held less than
         10 years.

17.      RESTRUCTURING CHARGES

         On March 22,  2001 and  December  3, 2001,  the  Company  announced  separate  plans to reduce  expenses  to better  align its
         operating  infrastructure  with the current investment market  environment.  As part of the two plans, the Company's workforce
         was  reduced by  approximately  140  positions  and 115  positions,  respectively,  affecting  substantially  all areas of the
         Company.  Estimated  pre-tax  severance  benefits  of $8,500  have been  charged  against  2001  operations  related  to these
         reductions.  These  charges  have been  reported in the  Consolidated  Statements  of Income as a component  of  Underwriting,
         Acquisition and Other Insurance Expenses. As of December 31, 2002 and 2001, the remaining  restructuring  liability,  relating
         primarily to the December 3, 2001 plan, was $12 and $4,104, respectively.

18.      COMMITMENTS AND CONTINGENT LIABILITIES

         In recent years, a number of annuity  companies have been named as defendants in class action lawsuits  relating to the use of
         variable  annuities as funding vehicles for tax- qualified  retirement  accounts.  The Company is currently a defendant in one
         such lawsuit.  A purported class action  complaint was filed in the United States District Court for the Southern  District of
         New York on  December  12,  2002,  by Diane C.  Donovan  against  the Company  and  certain of its  affiliates  (the  "Donovan
         Complaint").  The  Donovan  Complaint  seeks  unspecified  compensatory  damages  and  injunctive  relief from the Company and
         certain of its  affiliates.  The Donovan  Complaint  claims that the Company and certain of its  affiliates  violated  federal
         securities laws in marketing  variable  annuities.  This litigation is in the preliminary  stages.  The Company  believes this
         action is without merit, and intends to vigorously defend against this action.

         The  Company  is also  involved  in other  lawsuits  arising,  for the most  part,  in the  ordinary  course  of its  business
         operations.  While the  outcome of these  other  lawsuits  cannot be  determined  at this  time,  after  consideration  of the
         defenses available to the Company,  applicable insurance coverage and any related reserves  established,  these other lawsuits
         are not expected to result in  liability  for amounts  material to the  financial  condition  of the Company,  although it may
         adversely affect results of operations in future periods.

                                              AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                                (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                        Notes to Consolidated Financial Statements (continued)

18.      COMMITMENTS AND CONTINGENT LIABILITIES (continued)

         As discussed  previously,  on December 19, 2002, SICL entered into a definitive purchase agreement (the "Purchase  Agreement")
         to sell its  ownership  interest in the Company and certain  affiliates  to  Prudential  Financial  for  approximately  $1.265
         billion.  The closing of this  transaction,  which is conditioned  upon certain  customary  regulatory and other approvals and
         conditions, is expected in the second quarter of 2003.

         The purchase  price that was agreed to between SICL and  Prudential  Financial was based on a September 30, 2002  valuation of
         the Company and certain  affiliates.  As a result,  assuming the transaction  closes,  the economics of the Company's business
         from  September  30, 2002 forward will inure to the benefit or detriment  of  Prudential  Financial.  Included in the Purchase
         Agreement,  SICL has agreed to indemnify  Prudential  Financial  for certain  liabilities  that may arise  relating to periods
         prior to  September  30,  2002.  These  liabilities  generally  include  market  conduct  activities,  as well as contract and
         regulatory compliance (referred to as "Covered Liabilities").

         Related to the  indemnification  provisions  contained  in the  Purchase  Agreement,  SICL has signed,  for the benefit of the
         Company,  an indemnity  letter,  effective  December 19, 2002, to make the Company whole for certain Covered  Liabilities that
         come to  fruition  during  the  period  beginning  December  19,  2002 and  ending  with the  close of the  transaction.  This
         indemnification  effectively  transfers the risk associated with those Covered Liabilities from the Company to SICL concurrent
         with the signing of the definitive purchase agreement rather than waiting until the transaction closes.

19.      SEGMENT REPORTING

         Assets under  management and sales for products  other than variable  annuities  have not been  significant  enough to warrant
         full segment disclosures as required by SFAS 131,  "Disclosures about Segments of an Enterprise and Related  Information," and
         the Company does not  anticipate  that they will be so in the future due to changes in the Company's  strategy to focus on its
         core variable annuity business.
















                                              AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                                (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                        Notes to Consolidated Financial Statements (continued)

20.      QUARTERLY FINANCIAL DATA (UNAUDITED)

         The following table summarizes information with respect to the operations of the Company on a quarterly basis:

                                                                      Three Months Ended
                                                  ----------------------------------------------------------
                          2002                      March 31       June 30       Sept. 30        Dec. 31
        Premiums and other insurance revenues*    $   118,797   $    126,614   $    115,931   $    108,488
        Net investment income                           4,965          4,714          5,128          4,825
        Net realized capital losses                    (1,840)        (1,584)        (2,327)        (3,863)
        Total revenues                                121,922        129,744        118,732        109,450
        Benefits and expenses*                        112,759        160,721        323,529        150,906
        Pre-tax net income (loss)                       9,163        (30,977)      (204,797)       (41,456)
        Income tax expense (benefit)                    1,703        (11,746)       (72,754)       (20,013)
        Net income (loss)                         $     7,460   $    (19,231)  $   (132,043)  $    (21,443)

         *        For the quarters ended March 31, 2002 and June 30, 2002, the Company had overstated  premiums ceded in revenues.  The
                  above presentation  reflects an equal and offsetting  reclassification of these amounts to benefits and expenses with
                  no net income impact.

                                                                      Three Months Ended
                                                  ----------------------------------------------------------
                          2001                      March 31       June 30       Sept. 30        Dec. 31
        Premiums and other insurance revenues***  $   130,885   $    128,465   $    122,708   $    119,604
        Net investment income**                         5,381          4,997          5,006          4,742
        Net realized capital gains (losses)             1,902            373            376         (1,723)
        Total revenues                                138,168        133,835        128,090        122,623
        Benefits and expenses**  ***                  122,729        110,444        123,307        125,969
        Pre-tax net income (loss)                      15,439         23,391          4,783         (3,346)
        Income tax expense (benefit)                    4,034          7,451           (480)        (3,837)
        Net income                                $    11,405   $     15,940   $      5,263   $        491

         **       For the quarters  ended March 31, 2001,  June 30, 2001 and  September 30, 2001,  the Company had reported  investment
                  performance   associated  with  its  derivatives  as  net  investment  income.  The  above  presentation  reflects  a
                  reclassification of these amounts to benefits and expenses.
         ***      For the  quarters  ended  September  30, 2001 and December 31, 2001,  the Company had  overstated  premiums  ceded in
                  revenues.  The above presentation reflects an equal and offsetting  reclassification of these amounts to benefits and
                  expenses with no net income impact.

                                              AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                                (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                        Notes to Consolidated Financial Statements (continued)

20.      QUARTERLY FINANCIAL DATA (UNAUDITED) (continued)

                                                                      Three Months Ended
                                                  ----------------------------------------------------------
                          2000                      March 31       June 30       Sept. 30        Dec. 31
        Premiums and other insurance revenues     $    137,040  $    139,346   $   147,819    $    135,866
        Net investment income****                        4,343         4,625         4,619           5,008
        Net realized capital gains (losses)                729        (1,436)         (858)            877
        Total revenues                                 142,112       142,535       151,580         141,751
        Benefits and expenses****                      107,893       122,382       137,843         114,264
        Pre-tax net income                              34,219        20,153        13,737          27,487
        Income tax expense                              10,038         5,225         3,167          12,349
        Net income                                $     24,181  $     14,928   $    10,570    $     15,138

         ****     For the quarters  ended March 31,  2000,  June 30, 2000,  September  30, 2000 and December 31, 2000,  the Company had
                  reported  investment  performance  associated with its derivatives as net investment  income.  The above presentation
                  reflects a reclassification of these amounts to benefits and expenses.








                                 APPENDIX B - CONDENSED FINANCIAL INFORMATION ABOUT SEPARATE ACCOUNT B

Separate  Account B  consists  of  multiple  Sub-accounts.  Each  Sub-account  invests  only in a single  mutual  fund or  mutual  fund
portfolio.  All or some of these  Sub-accounts  are available as investment  options for other variable  annuities we offer pursuant to
different prospectuses.

Unit Prices And Numbers Of Units:  The  following  table shows:  (a) the Unit Price,  as of the dates  shown,  for Units in each of the
Sub-accounts of Separate  Account B that are being offered  pursuant to this  Prospectus;  and (b) the number of Units  outstanding for
each such  Sub-account  as of the dates shown.  Since  November 18, 2002,  we have been  determining,  on a daily basis,  multiple Unit
Prices for each  Sub-account of Separate  Account B. We compute  multiple Unit Prices because several of our variable  annuities invest
in the same  Sub-accounts,  and these annuities deduct varying charges that correspond to each combination of the applicable  Insurance
Charge,  Distribution  Charge (when applicable) and the charges for each optional benefit.  Where an asset-based  charge  corresponding
to a particular  Sub-account within a new annuity product is identical to that in the same Sub-account within an existing annuity,  the
Unit Price for the new annuity will be  identical  to that of the  existing  annuity.  In such cases,  we will for  reference  purposes
depict,  in the  condensed  financial  information  for the new  annuity,  Unit  Prices  of the  existing  annuity.  The  year in which
operations  commenced in each such  Sub-account is noted in  parentheses.  To the extent a Sub-account  commenced  operations  during a
particular  calendar year, the Unit Price as of the end of the period  reflects only the partial year results from the  commencement of
operations  until December 31st of the applicable  year. When a Unit Price was first  calculated for a particular  Sub-account,  we set
the price of that Unit at $10.00  per Unit.  Thereafter,  Unit  Prices  vary  based on market  performance.  Unit  Prices and Units are
provided for Sub-accounts that commenced operations prior to January 1, 2003.


                           Year Ended December 31,
- -------------------------------------------------- -------------
Sub-account                                            2002
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST Strong International Equity 1 (1989)
     With No Optional Benefits
     Unit Price                                           $8.56
     Number of Units                                  2,569,506
     With One Optional Benefit
     Unit Price                                           $9.95
     Number of Units                                     90,759
     With Any Two Optional Benefits
     Unit Value                                           $9.95
     Number of Units                                      6,047
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST William Blair International Growth 2(1997)
     With No Optional Benefits
     Unit Price                                           $9.72
     Number of Units                                    835,523
     With One Optional Benefit
     Unit Price                                           $9.72
     Number of Units                                     78,368
     With Any Two Optional Benefits
     Unit Price                                           $9.71
     Number of Units                                      5,178
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST American Century International Growth 3
(1997)
     With No Optional Benefits
     Unit Price                                           $8.52
     Number of Units                                  2,252,674
     With One Optional Benefit
     Unit Price                                           $9.69
     Number of Units                                    116,123
     With Any Two Optional Benefits
     Unit Price                                           $9.69
     Number of Units                                      1,896
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------

                           Year Ended December 31,
- -------------------------------------------------- -------------
Sub-account                                            2002
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST DeAM International Equity 4 (1994)
     With No Optional Benefits
     Unit Price                                           $8.19
     Number of Units                                    269,995
     With One Optional Benefit
     Unit Price                                           $9.79
     Number of Units                                     22,770
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST MFS Global Equity (1999)
     With No Optional Benefits
     Unit Price                                           $9.04
     Number of Units                                    969,509
     With One Optional Benefit
     Unit Price                                           $9.87
     Number of Units                                     32,306
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST PBHG Small-Cap Growth 5 (1994)
     With No Optional Benefits
     Unit Price                                           $6.92
     Number of Units                                  1,970,250
     With One Optional Benefit
     Unit Price                                           $9.48
     Number of Units                                     47,261
     With Any Two Optional Benefits
     Unit Price                                           $9.47
     Number of Units                                      6,595
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST DeAM Small-Cap Growth 6 (1999)
     With No Optional Benefits
     Unit Price                                           $7.67
     Number of Units                                    639,695
     With One Optional Benefit
     Unit Price                                           $9.71
     Number of Units                                     12,122
     With Any Two Optional Benefits
     Unit Price                                           $9.71
     Number of Units                                      1,728
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST Federated Aggressive Growth (2000)
     With No Optional Benefits
     Unit Price                                           $7.64
     Number of Units                                  1,255,415
     With One Optional Benefit
     Unit Price                                           $9.86
     Number of Units                                     63,097
     With Any Two Optional Benefits
     Unit Price                                           $9.86
     Number of Units                                      4,107
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------

                           Year Ended December 31,
- -------------------------------------------------- -------------
Sub-account                                            2002
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST Gabelli Small-Cap Value 7 (1997)
     With No Optional Benefits
     Unit Price                                           $9.30
     Number of Units                                  6,141,523
     With One Optional Benefit
     Unit Price                                          $10.08
     Number of Units                                    209,790
     With Any Two Optional Benefits
     Unit Price                                          $10.08
     Number of Units                                     17,411
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST DeAM Small-Cap Value 8 (2002)
     With No Optional Benefits
     Unit Price                                           $7.66
     Number of Units                                    423,387
     With One Optional Benefit
     Unit Price                                          $10.08
     Number of Units                                     11,686
     With Any Two Optional Benefits
     Unit Price                                          $10.08
     Number of Units                                      5,211
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST Goldman Sachs Mid-Cap Growth 9 (2000)
     With No Optional Benefits
     Unit Price                                           $7.97
     Number of Units                                  1,273,118
     With One Optional Benefit
     Unit Price                                           $9.87
     Number of Units                                     66,279
     With Any Two Optional Benefits
     Unit Price                                           $9.87
     Number of Units                                      2,488
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST Neuberger Berman Mid-Cap Growth 10 (1994)
     With No Optional Benefits
     Unit Price                                           $7.41
     Number of Units                                  2,175,250
     With One Optional Benefit
     Unit Price                                           $9.51
     Number of Units                                     44,760
     With Any Two Optional Benefits
     Unit Price                                           $9.51
     Number of Units                                      1,311
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------

                           Year Ended December 31,
- -------------------------------------------------- -------------
Sub-account                                            2002
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST Neuberger Berman Mid-Cap Value 11 (1993)
     With No Optional Benefits
     Unit Price                                           $8.96
     Number of Units                                  5,118,558
     With One Optional Benefit
     Unit Price                                           $9.98
     Number of Units                                    163,415
     With Any Two Optional Benefits
     Unit Price                                           $9.97
     Number of Units                                     10,745
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST Alger All-Cap Growth (2000)
     With No Optional Benefits
     Unit Price                                           $6.80
     Number of Units                                    658,419
     With One Optional Benefit
     Unit Price                                           $9.36
     Number of Units                                      6,409
     With Any Two Optional Benefits
     Unit Price                                           $9.36
     Number of Units                                      3,466
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST Gabelli All-Cap Value (2000)
     With No Optional Benefits
     Unit Price                                           $8.17
     Number of Units                                  1,200,225
     With One Optional Benefit
     Unit Price                                          $10.04
     Number of Units                                     28,449
     With Any Two Optional Benefits
     Unit Price                                          $10.04
     Number of Units                                         88
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST T. Rowe Price Natural Resources (1995)
     With No Optional Benefits
     Unit Price                                           $9.59
     Number of Units                                    724,670
     With One Optional Benefit
     Unit Price                                          $10.44
     Number of Units                                      7,378
     With Any Two Optional Benefits
     Unit Price                                          $10.44
     Number of Units                                      5,472
     With All Optional Benefits
     Unit Price
     Number of Units
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST Alliance Growth 12 (1996)
     With No Optional Benefits
     Unit Price                                           $7.46
     Number of Units                                  1,869,353
     With One Optional Benefit
     Unit Price                                           $9.34
     Number of Units                                     31,105
     With Any Two Optional Benefits
     Unit Price                                           $9.34
     Number of Units                                      3,975
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------

                           Year Ended December 31,
- -------------------------------------------------- -------------
Sub-account                                            2002
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST MFS Growth (1999)
     With No Optional Benefits
     Unit Price                                           $7.58
     Number of Units                                  2,930,432
     With One Optional Benefit
     Unit Price                                           $9.47
     Number of Units                                    134,574
     With Any Two Optional Benefits
     Unit Price                                           $9.46
     Number of Units                                      2,437
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST Marsico Capital Growth (1997)
     With No Optional Benefits
     Unit Price                                           $8.32
     Number of Units                                 10,144,317
     With One Optional Benefit
     Unit Price                                           $9.51
     Number of Units                                    457,013
     With Any Two Optional Benefits
     Unit Price                                           $9.51
     Number of Units                                     30,465
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST Goldman Sachs Concentrated Growth 13 (1992)
     With No Optional Benefits
     Unit Price                                           $7.67
     Number of Units                                  1,349,939
     With One Optional Benefit
     Unit Price                                           $9.46
     Number of Units                                     41,632
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST DeAm Large-Cap Growth 8 (2002)
     With No Optional Benefits
     Unit Price                                           $7.65
     Number of Units                                    207,816
     With One Optional Benefit
     Unit Price                                           $9.64
     Number of Units                                      9,837
     With Any Two Optional Benefits
     Unit Price                                           $9.64
     Number of Units                                      3,697
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST DeAm Large-Cap Value 14 (2000)
     With No Optional Benefits
     Unit Price                                           $8.66
     Number of Units                                    664,649
     With One Optional Benefit
     Unit Price                                           $9.98
     Number of Units                                     18,250
     With Any Two Optional Benefits
     Unit Price                                           $9.97
     Number of Units                                      4,906
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------

                           Year Ended December 31,
- -------------------------------------------------- -------------
Sub-account                                            2002
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST Alliance/Bernstein Growth + Value (2001)
     With No Optional Benefits
     Unit Price                                           $7.99
     Number of Units                                    965,912
     With One Optional Benefit
     Unit Price                                           $9.79
     Number of Units                                     11,345
     With Any Two Optional Benefits
     Unit Price                                           $9.79
     Number of Units                                        704
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST AST Sanford Bernstein Core Value (2001)
     With No Optional Benefits
     Unit Price                                           $8.76
     Number of Units                                  6,005,922
     With One Optional Benefit
     Unit Price                                          $10.08
     Number of Units                                    386,259
     With Any Two Optional Benefits
     Unit Price                                          $10.08
     Number of Units                                     30,510
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST Cohen & Steers Realty (1998)
     With No Optional Benefits
     Unit Price                                          $10.08
     Number of Units                                  1,563,489
     With One Optional Benefit
     Unit Price                                          $10.33
     Number of Units                                     41,098
     With Any Two Optional Benefits
     Unit Price                                          $10.32
     Number of Units                                      6,429
     With All Optional Benefits
     Unit Price
     Number of Units
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST Sanford Bernstein Managed Index 500 15 (1998)
     With No Optional Benefits
     Unit Price                                           $8.17
     Number of Units                                  3,662,406
     With One Optional Benefit
     Unit Price                                           $9.81
     Number of Units                                     79,915
     With Any Two Optional Benefits
     Unit Price                                           $9.81
     Number of Units                                        383
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST American Century Income & Growth 16 (1997)
     With No Optional Benefits
     Unit Price                                           $8.25
     Number of Units                                  1,751,136
     With One Optional Benefit
     Unit Price                                           $9.89
     Number of Units                                     36,829
     With Any Two Optional Benefits
     Unit Price                                           $9.89
     Number of Units                                      8,874
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------

                           Year Ended December 31,
- -------------------------------------------------- -------------
Sub-account                                            2002
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST Alliance Growth and Income 17 (1992)
     With No Optional Benefits
     Unit Price                                           $8.06
     Number of Units                                  6,667,373
     With One Optional Benefit
     Unit Price                                           $9.83
     Number of Units                                    165,588
     With Any Two Optional Benefits
     Unit Price                                           $9.83
     Number of Units                                      6,100
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST MFS Growth with Income (1999)
     With No Optional Benefits
     Unit Price                                           $8.09
     Number of Units                                  1,053,007
     With One Optional Benefit
     Unit Price                                           $9.71
     Number of Units                                     17,242
     With Any Two Optional Benefits
     Unit Price                                           $9.71
     Number of Units                                        538
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST INVESCO Capital Income 18 (1994)
     With No Optional Benefits
     Unit Price                                           $8.34
     Number of Units                                  2,110,071
     With One Optional Benefit
     Unit Price                                           $9.90
     Number of Units                                     30,714
     With Any Two Optional Benefits
     Unit Price                                           $9.90
     Number of Units                                      5,934
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST DeAM Global Allocation 19 (1993)
     With No Optional Benefits
     Unit Price                                           $8.71
     Number of Units                                    847,517
     With One Optional Benefit
     Unit Price                                           $9.94
     Number of Units                                      3,088
     With Any Two Optional Benefits
     Unit Price                                           $9.93
     Number of Units                                         94
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST American Century Strategic Balanced (1997)
     With No Optional Benefits
     Unit Price                                           $9.14
     Number of Units                                  1,126,058
     With One Optional Benefit
     Unit Price                                           $9.97
     Number of Units                                     15,835
     With Any Two Optional Benefits
     Unit Price                                           $9.97
     Number of Units                                      2,760
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------

                           Year Ended December 31,
- -------------------------------------------------- -------------
Sub-account                                            2002
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST T. Rowe Price Asset Allocation (1994)
     With No Optional Benefits
     Unit Price                                           $9.09
     Number of Units                                    921,329
     With One Optional Benefit
     Unit Price                                           $9.96
     Number of Units                                     21,928
     With Any Two Optional Benefits
     Unit Price                                           $9.96
     Number of Units                                        150
     With All Optional Benefits
     Unit Price
     Number of Units
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST T. Rowe Price Global Bond 20 (1994)
     With No Optional Benefits
     Unit Price                                          $11.34
     Number of Units                                  1,739,313
     With One Optional Benefit
     Unit Price                                          $10.31
     Number of Units                                     36,822
     With Any Two Optional Benefits
     Unit Price                                          $10.31
     Number of Units                                      3,700
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST Federated High Yield (1994)
     With No Optional Benefits
     Unit Price                                           $9.71
     Number of Units                                  5,592,940
     With One Optional Benefit
     Unit Price                                          $10.26
     Number of Units                                     74,022
     With Any Two Optional Benefits
     Unit Price                                          $10.26
     Number of Units                                      6,524
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST Lord Abbett Bond-Debenture (2000)
     With No Optional Benefits
     Unit Price                                           $9.94
     Number of Units                                  4,146,530
     With One Optional Benefit
     Unit Price                                          $10.23
     Number of Units                                    162,571
     With Any Two Optional Benefits
     Unit Price                                          $10.23
     Number of Units                                      7,474
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST DeAM Bond 8 (2002)
     With No Optional Benefits
     Unit Price                                          $10.65
     Number of Units                                    561,446
     With One Optional Benefit
     Unit Price                                          $10.16
     Number of Units                                     12,055
     With Any Two Optional Benefits
     Unit Price                                          $10.15
     Number of Units                                        595
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------

                           Year Ended December 31,
- -------------------------------------------------- -------------
Sub-account                                            2002
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST PIMCO Total Return Bond (1994)
     With No Optional Benefits
     Unit Price                                          $10.57
     Number of Units                                 20,544,075
     With One Optional Benefit
     Unit Price                                          $10.17
     Number of Units                                    604,147
     With Any Two Optional Benefits
     Unit Price                                          $10.17
     Number of Units                                     36,236
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST PIMCO Limited Maturity Bond (1995)
     With No Optional Benefits
     Unit Price                                          $10.34
     Number of Units                                 11,274,642
     With One Optional Benefit
     Unit Price                                          $10.08
     Number of Units                                    215,314
     With Any Two Optional Benefits
     Unit Price                                          $10.08
     Number of Units                                     80,547
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST Money Market (1992)
     With No Optional Benefits
     Unit Price                                           $9.96
     Number of Units                                 36,255,772
     With One Optional Benefit
     Unit Price                                           $9.99
     Number of Units                                    999,737
     With Any Two Optional Benefits
     Unit Price                                           $9.99
     Number of Units                                     70,899
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
Gartmore Variable Investment Trust - GVIT
Developing Markets 9 (1996)
     With No Optional Benefits
     Unit Price                                           $8.66
     Number of Units                                    283,466
     With One Optional Benefit
     Unit Price                                           $9.93
     Number of Units                                     21,816
     With Any Two Optional Benefits
     Unit Price                                           $9.93
     Number of Units                                        442
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
Wells Fargo Variable Trust - Equity Income (1999)
     With No Optional Benefits
     Unit Price                                           $8.25
     Number of Units                                    196,720
     With One Optional Benefit
     Unit Price                                           $9.90
     Number of Units                                     10,707
     With Any Two Optional Benefits
     Unit Price                                           $9.90
     Number of Units                                         91
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------

                           Year Ended December 31,
- -------------------------------------------------- -------------
Sub-account                                            2002
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
INVESCO VIF - Dynamics (1999)
     With No Optional Benefits
     Unit Price                                           $7.09
     Number of Units                                    543,762
     With One Optional Benefit
     Unit Price                                           $9.70
     Number of Units                                     32,635
     With Any Two Optional Benefits
     Unit Price                                           $9.70
     Number of Units                                        576
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
INVESCO VIF - Technology (1999)
     With No Optional Benefits
     Unit Price                                           $5.50
     Number of Units                                    293,307
     With One Optional Benefit
     Unit Price                                               -
     Number of Units                                          -
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
INVESCO VIF - Health Sciences (1999)
     With No Optional Benefits
     Unit Price                                           $8.00
     Number of Units                                    475,873
     With One Optional Benefit
     Unit Price                                           $9.51
     Number of Units                                      5,444
     With Any Two Optional Benefits
     Unit Price                                           $9.51
     Number of Units                                        140
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
INVESCO VIF - Financial Services (1999)
     With No Optional Benefits
     Unit Price                                           $8.76
     Number of Units                                    366,258
     With One Optional Benefit
     Unit Price                                           $9.92
     Number of Units                                      1,897
     With Any Two Optional Benefits
     Unit Price                                           $9.92
     Number of Units                                        141
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
INVESCO VIF - Telecommunications (1999)
     With No Optional Benefits
     Unit Price                                           $5.78
     Number of Units                                     94,004
     With One Optional Benefit
     Unit Price                                           $9.43
     Number of Units                                        770
     With Any Two Optional Benefits
     Unit Price                                           $9.42
     Number of Units                                        454
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------

                           Year Ended December 31,
- -------------------------------------------------- -------------
Sub-account                                            2002
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
Evergreen VA - Global Leaders (1999)
     With No Optional Benefits
     Unit Price                                           $8.15
     Number of Units                                    113,389
     With One Optional Benefit
     Unit Price                                           $9.67
     Number of Units                                      3,669
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
Evergreen VA - Special Equity (1999)
     With No Optional Benefits
     Unit Price                                           $7.44
     Number of Units                                    127,728
     With One Optional Benefit
     Unit Price                                           $9.85
     Number of Units                                     12,520
     With Any Two Optional Benefits
     Unit Price                                           $9.85
     Number of Units                                        533
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
Evergreen VA - Omega (2000)
     With No Optional Benefits
     Unit Price                                           $7.78
     Number of Units                                     39,943
     With One Optional Benefit
     Unit Price                                               -
     Number of Units                                          -
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - Europe 30 (1999)
     With No Optional Benefits
     Unit Price                                           $7.93
     Number of Units                                    292,396
     With One Optional Benefit
     Unit Price                                           $9.70
     Number of Units                                      2,625
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - Asia 30 8 (2002)
     With No Optional Benefits
     Unit Price                                           $7.75
     Number of Units                                    281,993
     With One Optional Benefit
     Unit Price                                           $9.86
     Number of Units                                      6,995
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------

                           Year Ended December 31,
- -------------------------------------------------- -------------
Sub-account                                            2002
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - Japan 8 (2002)
     With No Optional Benefits
     Unit Price                                           $7.24
     Number of Units                                     65,845
     With One Optional Benefit
     Unit Price                                          $10.21
     Number of Units                                        351
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - Banks 8 (2002)
     With No Optional Benefits
     Unit Price                                           $8.56
     Number of Units                                    101,136
     With One Optional Benefit
     Unit Price                                          $10.13
     Number of Units                                      3,422
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - Basic Materials 8 (2002)
     With No Optional Benefits
     Unit Price                                           $8.46
     Number of Units                                     76,331
     With One Optional Benefit
     Unit Price                                          $10.34
     Number of Units                                         12
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - Biotechnology (2001)
     With No Optional Benefits
     Unit Price                                           $7.09
     Number of Units                                    130,082
     With One Optional Benefit
     Unit Price                                               -
     Number of Units                                          -
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - Consumer Cyclical 8 (2002)
     With No Optional Benefits
     Unit Price                                           $7.25
     Number of Units                                    128,022
     With One Optional Benefit
     Unit Price                                           $9.37
     Number of Units                                      2,426
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------

                           Year Ended December 31,
- -------------------------------------------------- -------------
Sub-account                                            2002
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - Consumer Non-Cyclical 8 (2002)
     With No Optional Benefits
     Unit Price                                           $8.28
     Number of Units                                    148,446
     With One Optional Benefit
     Unit Price                                           $9.90
     Number of Units                                      2,303
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - Energy (2001)
     With No Optional Benefits
     Unit Price                                           $8.71
     Number of Units                                    299,833
     With One Optional Benefit
     Unit Price                                          $10.12
     Number of Units                                      1,660
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - Financial (2001)
     With No Optional Benefits
     Unit Price                                           $8.85
     Number of Units                                    221,377
     With One Optional Benefit
     Unit Price                                           $9.84
     Number of Units                                      2,066
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - Healthcare (2001)
     With No Optional Benefits
     Unit Price                                           $7.94
     Number of Units                                    388,508
     With One Optional Benefit
     Unit Price                                           $9.59
     Number of Units                                      6,831
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - Industrial 8 (2002)
     With No Optional Benefits
     Unit Price                                           $7.93
     Number of Units                                     12,642
     With One Optional Benefit
     Unit Price                                               -
     Number of Units                                          -
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------

                           Year Ended December 31,
- -------------------------------------------------- -------------
Sub-account                                            2002
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - Internet 8 (2002)
     With No Optional Benefits
     Unit Price                                           $8.57
     Number of Units                                    306,572
     With One Optional Benefit
     Unit Price                                               -
     Number of Units                                          -
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - Pharmaceuticals 8 (2002)
     With No Optional Benefits
     Unit Price                                           $8.56
     Number of Units                                    136,559
     With One Optional Benefit
     Unit Price                                           $9.63
     Number of Units                                      2,545
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - Precious Metals 8 (2002)
     With No Optional Benefits
     Unit Price                                           $9.70
     Number of Units                                  1,175,651
     With One Optional Benefit
     Unit Price                                          $11.30
     Number of Units                                     19,964
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - Real Estate (2001)
     With No Optional Benefits
     Unit Price                                           $9.86
     Number of Units                                    441,318
     With One Optional Benefit
     Unit Price                                          $10.20
     Number of Units                                     12,789
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP -Semiconductor 8 (2002)
     With No Optional Benefits
     Unit Price                                           $5.14
     Number of Units                                     93,241
     With One Optional Benefit
     Unit Price                                               -
     Number of Units                                          -
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------

                           Year Ended December 31,
- -------------------------------------------------- -------------
Sub-account                                            2002
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - Technology (2001)
     With No Optional Benefits
     Unit Price                                           $6.03
     Number of Units                                    254,131
     With One Optional Benefit
     Unit Price                                               -
     Number of Units                                          -
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - Telecommunications (2001)
     With No Optional Benefits
     Unit Price                                           $7.15
     Number of Units                                    272,408
     With One Optional Benefit
     Unit Price                                          $10.03
     Number of Units                                      3,642
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - Utilities (2001)
     With No Optional Benefits
     Unit Price                                           $7.83
     Number of Units                                    521,419
     With One Optional Benefit
     Unit Price                                          $10.61
     Number of Units                                      8,871
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - Bull 8 (2002)
     With No Optional Benefits
     Unit Price                                           $7.97
     Number of Units                                    954,792
     With One Optional Benefit
     Unit Price                                           $9.75
     Number of Units                                     10,297
     With Any Two Optional Benefits
     Unit Price                                           $9.75
     Number of Units                                        400
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - Bear (2001)
     With No Optional Benefits
     Unit Price                                          $11.38
     Number of Units                                  1,532,543
     With One Optional Benefit
     Unit Price                                          $10.13
     Number of Units                                     28,618
     With Any Two Optional Benefits
     Unit Price                                          $10.13
     Number of Units                                      1,514
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------

                           Year Ended December 31,
- -------------------------------------------------- -------------
Sub-account                                            2002
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - UltraBull 22 (2001)
     With No Optional Benefits
     Unit Price                                           $6.78
     Number of Units                                    297,435
     With One Optional Benefit
     Unit Price                                           $9.61
     Number of Units                                        245
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - OTC (2001)
     With No Optional Benefits
     Unit Price                                           $6.45
     Number of Units                                  1,346,852
     With One Optional Benefit
     Unit Price                                           $9.36
     Number of Units                                     13,113
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - Short OTC 8 (2002)
     With No Optional Benefits
     Unit Price                                          $11.00
     Number of Units                                    433,181
     With One Optional Benefit
     Unit Price                                          $10.43
     Number of Units                                     15,308
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - UltraOTC (1999)
     With No Optional Benefits
     Unit Price                                           $3.53
     Number of Units                                  1,003,123
     With One Optional Benefit
     Unit Price                                           $8.70
     Number of Units                                        233
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - Mid-Cap Value 8 (2002)
     With No Optional Benefits
     Unit Price                                           $7.66
     Number of Units                                    438,387
     With One Optional Benefit
     Unit Price                                          $10.06
     Number of Units                                      4,777
     With Any Two Optional Benefits
     Unit Price                                          $10.06
     Number of Units                                      4,799
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------

                           Year Ended December 31,
- -------------------------------------------------- -------------
Sub-account                                            2002
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - Mid-Cap Growth 8 (2002)
     With No Optional Benefits
     Unit Price                                           $7.70
     Number of Units                                    439,054
     With One Optional Benefit
     Unit Price                                           $9.82
     Number of Units                                      1,587
     With Any Two Optional Benefits
     Unit Price                                           $9.81
     Number of Units                                      1,583
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - UltraMid-Cap 8 (2002)
     With No Optional Benefits
     Unit Price                                           $5.71
     Number of Units                                    477,953
     With One Optional Benefit
     Unit Price                                           $9.86
     Number of Units                                      1,673
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - Small-Cap Value 8 (2002)
     With No Optional Benefits
     Unit Price                                           $7.09
     Number of Units                                    994,778
     With One Optional Benefit
     Unit Price                                          $10.15
     Number of Units                                     19,019
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - Small-Cap Growth 8 (2002)
     With No Optional Benefits
     Unit Price                                           $7.69
     Number of Units                                    772,260
     With One Optional Benefit
     Unit Price                                           $9.91
     Number of Units                                     10,572
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - UltraSmall-Cap 23 (1999)
     With No Optional Benefits
     Unit Price                                           $6.14
     Number of Units                                    212,085
     With One Optional Benefit
     Unit Price                                               -
     Number of Units                                          -
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------

                           Year Ended December 31,
- -------------------------------------------------- -------------
Sub-account                                            2002
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - U.S. Government Plus 8 (2002)
     With No Optional Benefits
     Unit Price                                          $11.56
     Number of Units                                  2,486,854
     With One Optional Benefit
     Unit Price                                          $10.19
     Number of Units                                     22,148
     With Any Two Optional Benefits
     Unit Price                                          $10.19
     Number of Units                                        609
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - Rising Rates Opportunity 8 (2002)
     With No Optional Benefits
     Unit Price                                           $8.02
     Number of Units                                    165,792
     With One Optional Benefit
     Unit Price                                           $9.69
     Number of Units                                      9,028
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
First Trust(R)10 Uncommon Values (2000)
     With No Optional Benefits
     Unit Price                                           $6.80
     Number of Units                                     19,826
     With One Optional Benefit
     Unit Price                                               -
     Number of Units                                          -
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
Prudential - SP Jennison International Growth
(2001)
     With No Optional Benefits
     Unit Price                                           $8.01
     Number of Units                                     89,806
     With One Optional Benefit
     Unit Price                                           $9.59
     Number of Units                                      5,196
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------

1.       Effective  December 10, 2001,  Strong Capital  Management,  Inc.  became  Sub-advisor of the Portfolio.  Prior to December 10,
     2001, A I M Capital Management,  Inc. served as Sub-advisor of the Portfolio,  then named "AST AIM International  Equity." Between
     October 15, 1996 and May 3, 1999,  Putnam  Investment  Management,  Inc.  served as Sub-advisor of the Portfolio,  then named "AST
     Putnam  International  Equity." Prior to October 15, 1996,  Seligman  Henderson Co. served as  Sub-advisor of the Portfolio,  then
     named "Seligman Henderson International Equity Portfolio."
2.       Effective  November 11, 2002,  William Blair & Company,  L.L.C.  became  Sub-advisor of the  Portfolio.  Prior to November 11,
     2002, Janus Capital Corporation served as Sub-advisor of the Portfolio, then named "AST Janus Overseas Growth."
3.       This  Portfolio  reflects  the  addition of the net assets of the AST  American  Century  International  Growth  Portfolio  II
     ("Portfolio II") as a result of the merger between the Portfolio and Portfolio II.
4.       Effective May 1, 2002,  Deutsche Asset Management,  Inc. became Sub-advisor of the Portfolio.  Prior to May 1, 2002,  Founders
     Asset  Management,  Inc. served as Sub-advisor of the Portfolio,  then named "AST Founders  Passport."  Prior to October 15, 1996,
     Seligman Henderson Co. served as Sub-advisor of the Portfolio, then named "Seligman Henderson International Small Cap Portfolio."
5.       Effective  September 17, 2001, Pilgrim Baxter & Associates,  Ltd. became Sub-advisor of the Portfolio.  Prior to September 17,
     2001,  Janus Capital  Corporation  served as  Sub-advisor  of the  Portfolio,  then named "AST Janus  Small-Cap  Growth." Prior to
     December  31,  1998,  Founders  Asset  Management,  LLC served as  Sub-advisor  of the  Portfolio,  then named  "Founders  Capital
     Appreciation Portfolio."
6.       Effective  December 10, 2001,  Deutsche Asset  Management,  Inc.  became  Sub-advisor of the Portfolio.  Prior to December 10,
     2001,  Zurich  Scudder  Investments,  Inc.  served as  Sub-advisor  of the  Portfolio,  then named "AST Scudder  Small-Cap  Growth
     Portfolio".  Prior to May 1, 2001, the Portfolio was named "AST Kemper Small-Cap Growth Portfolio."
7.       Effective  October 23, 2000, GAMCO  Investors,  Inc. became  Sub-advisor of the Portfolio.  Prior to October 23, 2000, T. Rowe
     Price Associates, Inc. served as Sub-advisor of the Portfolio, then named "AST T. Rowe Price Small Company Value Portfolio."
8.       These portfolios were first offered as Sub-accounts on May 1, 2002.
9.       The condensed  financial  information of this Gartmore Variable  Investment Trust portfolio relates to prior periods when such
     portfolio was a portfolio of Montgomery  Variable Series.  Pursuant to a shareholder vote,  effective June 20, 2003 the Montgomery
     Variable Series - Emerging  Markets  Portfolio  transferred its assets to the GVIT  Developing  Markets  Portfolio of the Gartmore
     Variable Investment Trust.
10.      Effective  November 11, 2002,  Goldman Sachs Asset  Management  became  Sub-advisor  of the  Portfolio.  Prior to November 11,
     2002, Janus Capital Corporation served as Sub-advisor of the Portfolio, then named "AST Janus Mid-Cap Growth."
11.      Effective May 1, 1998,  Neuberger Berman Management,  Inc. became  Sub-advisor of the Portfolio.  Prior to May 1, 1998, Berger
     Associates, Inc. served as Sub-advisor of the Portfolio, then named "Berger Capital Growth Portfolio."
12.      Effective  May 1,  1998,  Neuberger  Berman  Management,  Inc.  became  Sub-advisor  of the  Portfolio.  Prior to May 1, 1998,
     Federated Investment Counseling served as Sub-advisor of the Portfolio, then named "Federated Utility Income Portfolio."
13.      Effective May 1, 2000,  Alliance Capital Management,  L.P. became Sub-advisor of the Portfolio.  Between December 31, 1998 and
     May 1, 2000,  OppenheimerFunds,  Inc.  served as  Sub-advisor  of the  Portfolio,  then named "AST  Oppenheimer  Large-Cap  Growth
     Portfolio." Prior to December 31, 1998,  Robertson,  Stephens & Company Investment  Management,  L.P. served as Sub-advisor of the
     Portfolio, then named "Robertson Stephens Value + Growth Portfolio."
14.      Effective  November 11, 2002,  Goldman Sachs Asset  Management  became  Sub-advisor  of the  Portfolio.  Prior to November 11,
     2002, Janus Capital Corporation served as Sub-advisor of the Portfolio, then named "AST JanCap Growth."
15.      Effective May 1, 2002,  Deutsche Asset  Management,  Inc.  became  Sub-advisor of the Portfolio.  Prior to May 1, 2002,  Janus
     Capital Corporation served as Sub-advisor of the Portfolio, then named "AST Janus Strategic Value."
16.      Effective May 1, 2000,  Sanford C. Bernstein & Co., Inc. became  Sub-advisor of the Portfolio.  Prior to May 1, 2000,  Bankers
     Trust Company served as Sub-advisor of the Portfolio, then named "AST Bankers Trust Managed Index 500 Portfolio."
17.      Effective May 3, 1999,  American Century  Investment  Management,  Inc. became  Sub-advisor of the Portfolio.  Between October
     15, 1996 and May 3, 1999, Putnam Investment Management,  Inc. served as Sub-advisor of the Portfolio, then named "AST Putnam Value
     Growth & Income."
18.      Effective May 1, 2000,  Alliance Capital  Management,  L.P. became  Sub-advisor of the Portfolio.  Prior to May 1, 2000, Lord,
     Abbett & Co. served as Sub-advisor of the Portfolio, then named "AST Lord Abbett Growth and Income Portfolio."
19.      Effective July 1, 2002, the AST INVESCO Equity Income portfolio changed its name to AST INVESCO Capital Income.
20.      Effective May 1, 2002,  Deutsche Asset  Management,  Inc.  became  Sub-advisor  of the Portfolio.  Prior to May 1, 2002, A I M
     Capital Management,  Inc. served as Sub-advisor of the Portfolio,  then named "AST AIM Balanced." Between October 15, 1996 and May
     3, 1999, Putnam  Investment  Management,  Inc. served as Sub-advisor of the Portfolio,  then named "AST Putnam Balanced." Prior to
     October 15, 1996, Phoenix Investment Counsel, Inc. served as Sub-advisor of the Portfolio,  then named "AST Phoenix Balanced Asset
     Portfolio."
21.      Effective August 8, 2000, T. Rowe Price  International,  Inc. became Sub-advisor of the Portfolio.  Effective May 1, 2000, the
     name of the  Portfolio  was  changed  to the  "AST  T.  Rowe  Price  Global  Bond".  Effective  May 1,  1996,  Rowe  Price-Fleming
     International,  Inc.  became  Sub-advisor  of the  Portfolio.  Prior to May 1,  1996,  Scudder,  Stevens & Clark,  Inc.  served as
     Sub-advisor of the Portfolio, then named "AST Scudder International Bond Portfolio."
22.      Effective  May 1, 2003,  the ProFunds VP Bull Plus  portfolio  changed its name to ProFund VP UltraBull to reflect a change in
     its investment objective.
23.      Prior to May 1, 2000,  ProFund VP  UltraSmall-Cap  was named "ProFund VP Small Cap" and sought daily  investment  results that
     corresponded to the performance of the Russell 2000(R)Index.




                                          APPENDIX C - CALCULATION OF OPTIONAL DEATH BENEFITS

Examples of Enhanced Beneficiary Protection Optional Death Benefit Calculation
The following are examples of how the Enhanced  Beneficiary  Protection  Optional  Death Benefit is  calculated.  Each example  assumes
that a $50,000  initial  Purchase  Payment is made.  Each  example  assumes that there is one Owner who is age 50 on the Issue Date and
that all Account  Value is  maintained  in the variable  investment  options.  The formula for  determining  the  Enhanced  Beneficiary
Protection Optional Death Benefit is as follows:

           Growth =               Account Value of variable             minus         Purchase Payments - proportional
                               investment options plus Interim
                                Value of Fixed Allocations (no
                                         MVA applies)                                           withdrawals

Example with market increase
Assume that the Owner has made no withdrawals  and that the Account Value has been increasing due to positive  market  performance.  On
the date we receive due proof of death,  the Account  Value is $75,000.  The basic Death  Benefit is  calculated  as Purchase  Payments
minus  proportional  withdrawals,  or Account  Value,  which ever is greater.  Therefore,  the basic Death Benefit is equal to $75,000.
The Enhanced  Beneficiary  Protection  Optional  Death Benefit is equal to the amount  payable under the basic Death Benefit  ($75,000)
PLUS 40% of the "Growth" under the Annuity.

         Growth   =        $75,000 - [$50,000 - $0]
                  =        $25,000

         Benefit Payable under Enhanced Beneficiary Protection Optional Death Benefit = 40% of Growth
                  =        $25,000 * 0.40
                  =        $10,000

         Benefit Payable under Basic Death Benefit PLUS Enhanced Beneficiary Protection Optional Death Benefit
                  =        $85,000

Examples with market decline
Assume that the Owner has made no withdrawals  and that the Account Value has been  decreasing  due to declines in market  performance.
On the date we receive due proof of death,  the Account Value is $45,000.  The basic Death  Benefit is calculated as Purchase  Payments
minus  proportional  withdrawals,  or Account  Value,  which ever is greater.  Therefore,  the basic Death Benefit is equal to $50,000.
The Enhanced  Beneficiary  Protection  Optional  Death Benefit is equal to the amount  payable under the basic Death Benefit  ($50,000)
PLUS the "Growth" under the Annuity.

         Growth   =        $45,000 - [$50,000 - $0]
                  =        $-5,000

         Benefit Payable under Enhanced Beneficiary Protection Optional Death Benefit = 40% of Growth
                  NO BENEFIT IS PAYABLE

         Benefit Payable under Basic Death Benefit PLUS Enhanced Beneficiary Protection Optional Death Benefit
                  =        $50,000

In this example you would receive no additional benefit from purchasing the Enhanced Beneficiary Protection Optional Death Benefit.


Example with market increase and withdrawals
Assume that the Account Value has been  increasing  due to positive  market  performance  and the Owner made a withdrawal of $15,000 in
Annuity  Year 5 when the Account  Value was  $75,000.  On the date we receive due proof of death,  the  Account  Value is $90,000.  The
basic Death Benefit is  calculated as Purchase  Payments  minus  proportional  withdrawals,  or Account  Value,  which ever is greater.
Therefore,  the basic Death Benefit is equal to $90,000.  The Enhanced  Beneficiary  Protection  Optional Death Benefit is equal to the
amount payable under the basic Death Benefit ($90,000) PLUS 40% of the "Growth" under the Annuity.

         Growth   =        $90,000 - [$50,000 - ($50,000 * $15,000/$75,000)]
                  =        $90,000 - [$50,000 - $10,000]
                  =        $90,000 - $40,000
                  =        $50,000

         Benefit Payable under Enhanced Beneficiary Protection Optional Death Benefit = 40% of Growth
                  =        $50,000 * 0.40
                  =        $20,000

         Benefit Payable under Basic Death Benefit PLUS Enhanced Beneficiary Protection Optional Death Benefit
                  =        $110,000

Examples of Highest Anniversary Value Death Benefit Calculation
The  following  are  examples of how the Highest  Anniversary  Value  Death  Benefit is  calculated.  Each  example  assumes an initial
Purchase  Payment of $50,000.  Each example  assumes that there is one Owner who is age 70 on the Issue Date and that all Account Value
is maintained in the variable investment options.

Example with market increase and death before Death Benefit Target Date
Assume that the Owner's  Account Value has generally been increasing due to positive  market  performance and that no withdrawals  have
been made.  On the date we receive  due proof of death,  the  Account  Value is  $75,000;  however,  the  Anniversary  Value on the 5th
anniversary  of the Issue Date was $90,000.  Assume as well that the Owner has died before the Death  Benefit  Target  Date.  The Death
Benefit is equal to the greater of the Highest  Anniversary  Value or the basic Death  Benefit.  The Death Benefit would be the Highest
Anniversary  Value  ($90,000)  because  it is greater  than the amount  that would  have been  payable  under the basic  Death  Benefit
($75,000).

Example with withdrawals
Assume that the Account Value has been  increasing  due to positive  market  performance  and the Owner made a withdrawal of $15,000 in
Annuity Year 7 when the Account Value was $75,000.  On the date we receive due proof of death,  the Account Value is $80,000;  however,
the  Anniversary  Value on the 5th  anniversary of the Issue Date was $90,000.  Assume as well that the Owner has died before the Death
Benefit Target Date.  The Death Benefit is equal to the greater of the Highest Anniversary Value or the basic Death Benefit.

Highest Anniversary Value  = $90,000 - [$90,000 * $15,000/$75,000]
                                    = $90,000 - $18,000
                                    = $72,000

Basic Death Benefit                 = $80,000 - [$80,000 * $15,000/$75,000]
                                    = $80,000 - $16,000
                                    = $64,000

Example with death after Death Benefit Target Date
Assume that the Owner's  Account Value has generally been  increasing due to positive  market  performance  and that no withdrawals had
been made prior to the Death Benefit  Target Date.  Further  assume that the Owner dies after the Death Benefit  Target Date,  when the
Account Value is $75,000.  The Highest  Anniversary  Value on the Death Benefit Target Date was $80,000;  however,  following the Death
Benefit  Target  Date,  the Owner made a Purchase  Payment of $15,000 and had taken a withdrawal  of $5,000 when the Account  Value was
$70,000.  The Death  Benefit is equal to the  greater of the  Highest  Anniversary  Value plus  Purchase  Payments  minus  proportional
withdrawals after the Death Benefit Target Date or the basic Death Benefit.

Highest Anniversary Value  = $80,000 + $15,000 - [$80,000 * $5,000/$70,000]
                                    = $80,000 + $15,000 - $5,714
                                    = $100,714

Basic Death Benefit                 = $75,000





                                                 THIS PAGE IS INTENTIONALLY LEFT BLANK.





- ----------------------------------------------------------------------------------------------------------------------
                  PLEASE SEND ME A STATEMENT  OF  ADDITIONAL  INFORMATION  THAT  CONTAINS  FURTHER  DETAILS  ABOUT THE
                  AMERICAN SKANDIA ANNUITY DESCRIBED IN PROSPECTUS WFVAPEXII-PROS (12/2003).
- ----------------------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------

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


                                        _______________________________________________________
                                                           (print your name)



                                        _______________________________________________________
                                                               (address)



                                        _______________________________________________________
                                                         (city/state/zip code)



                                                 THIS PAGE IS INTENTIONALLY LEFT BLANK.


Variable Annuity Issued by:                                                                  Variable Annuity Distributed by:

AMERICAN SKANDIA LIFE                                                                                      AMERICAN SKANDIA
ASSURANCE CORPORATION                                                                               MARKETING, INCORPORATED
One Corporate Drive                                                                                     One Corporate Drive
Shelton, Connecticut 06484                                                                       Shelton, Connecticut 06484
Telephone: 1-800-680-8920                                                                           Telephone: 203-926-1888
http://www.americanskandia.prudential.com                                         http://www.americanskandia.prudential.com



                                                          MAILING ADDRESSES:


                                                 AMERICAN SKANDIA - VARIABLE ANNUITIES
                                                     Attention: Stagecoach Annuity
                                                             P.O. Box 7040
                                                       Bridgeport, CT 06601-7040



                                                             EXPRESS MAIL:
                                                 AMERICAN SKANDIA - VARIABLE ANNUITIES
                                                     Attention: Stagecoach Annuity
                                                          One Corporate Drive
                                                           Shelton, CT 06484


                                                                 NOTES






                                                                 NOTES
                                                                 NOTES
                                                                 NOTES
                                                                 NOTES









                                                                                         AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                                                                                     One Corporate Drive, Shelton, Connecticut 06484

This Prospectus  describes  StagecoachTM XTra CreditSM SIX, a flexible premium deferred annuity (the "Annuity")  offered by American
Skandia Life  Assurance  Corporation  ("American  Skandia",  "we",  "our" or "us")  exclusively  through Wells Fargo Bank,  N.A. The
Annuity may be offered as an  individual  annuity  contract or as an interest in a group  annuity.  This  Prospectus  describes  the
important  features of the Annuity and what you should  consider  before  purchasing the Annuity.  We have also filed a Statement of
Additional  Information  that is available from us, without charge,  upon your request.  The contents of the Statement of Additional
Information  are  described on page 77. The Annuity or certain of its  investment  options  and/or  features may not be available in
all states.  Various rights and benefits may differ between states to meet  applicable  laws and/or  regulations.  Certain terms are
capitalized  in this  Prospectus.  Those  terms are either  defined in the  Glossary  of Terms or in the  context of the  particular
section.

====================================================================================================================================
American  Skandia offers several  different  annuities  which your investment  professional  may be authorized to offer to you. Each
annuity has different  features and benefits that may be  appropriate  for you based on your financial  situation,  your age and how
you intend to use the annuity.  The different features and benefits include variations in death benefit  protection,  the ability to
access your  annuity's  account value and the charges that you will be subject to if you choose to surrender  the annuity.  The fees
and charges may also be different between each annuity.
====================================================================================================================================

If you are purchasing the Annuity as a replacement  for existing  variable  annuity or variable life coverage,  you should  consider
any  surrender or penalty  charges you may incur when  replacing  your  existing  coverage and that this Annuity may be subject to a
contingent  deferred  sales charge if you elect to surrender  the Annuity or take a partial  withdrawal.  You should  consider  your
need to access the Annuity's Account Value and whether the annuity's liquidity features will satisfy that need.

WHY WOULD I CHOOSE TO PURCHASE THIS ANNUITY?
This Annuity is frequently  used for  retirement  planning  because it allows you to accumulate  retirement  savings and also offers
annuity payment options when you are ready to begin  receiving  income.  The Annuity also offers one or more death benefits that can
protect  your  retirement  savings if you die during a period of  declining  markets.  It may be used as an  investment  vehicle for
"qualified"  investments,  including an IRA,  SEP-IRA,  Roth IRA or Tax  Sheltered  Annuity (or  403(b)).  It may also be used as an
investment  vehicle  for  "non-qualified"  investments.  The  Annuity  allows  you to  invest  your  money in a number  of  variable
investment options as well as in one or more fixed investment options.

When an Annuity is purchased as a  "non-qualified"  investment,  you  generally  are not taxed on any  investment  gains the Annuity
earns until you make a  withdrawal  or begin to receive  annuity  payments.  This  feature,  referred to as  "tax-deferral",  can be
beneficial to the growth of your Account Value  because money that would  otherwise be needed to pay taxes on investment  gains each
year remains invested and can earn additional money.  However,  because the Annuity is designed for long-term  retirement savings, a
10%  penalty  tax may be  applied  on  withdrawals  you make  before  you  reach age 59 1/2.  Annuities  purchased  as a  non-qualified
investment  are not subject to the maximum  contribution  limits  that may apply to a qualified  investment,  and are not subject to
required minimum distributions after age 701/2.

When an Annuity is purchased as a "qualified"  investment,  you should consider that the Annuity does not provide any tax advantages
in addition to the  preferential  treatment  already  available  through your  retirement  plan under the Internal  Revenue Code. An
Annuity may offer  features  and  benefits in addition to  providing  tax  deferral  that other  investment  vehicles may not offer,
including  death benefit  protection for your  beneficiaries,  lifetime income  options,  and the ability to make transfers  between
numerous  variable  investment  options  offered  under the Annuity.  You should  consult with your  investment  professional  as to
whether the overall benefits and costs of the Annuity are appropriate considering your overall financial plan.

- ------------------------------------------------------------------------------------------------------------------------------------
These  annuities are NOT deposits or  obligations  of, or issued,  guaranteed or endorsed by, any bank, or bank  subsidiary of Wells
Fargo Bank,  N.A., are NOT insured or guaranteed by the U.S.  government,  the Federal Deposit  Insurance  Corporation  (FDIC),  the
Federal Reserve Board or any other agency.  An investment in this annuity  involves  investment  risks,  including  possible loss of
value.
- ------------------------------------------------------------------------------------------------------------------------------------

THESE  SECURITIES  HAVE NOT BEEN  APPROVED  OR  DISAPPROVED  BY THE  SECURITIES  AND  EXCHANGE  COMMISSION  OR ANY STATE  SECURITIES
COMMISSION NOR HAS THE COMMISSION OR ANY STATE SECURITIES  COMMISSION  PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS.  ANY
REPRESENTATION  TO THE CONTRARY IS A CRIMINAL  OFFENSE.  PLEASE READ THIS  PROSPECTUS AND THE CURRENT  PROSPECTUS FOR THE UNDERLYING
MUTUAL FUNDS.  KEEP THEM FOR FUTURE REFERENCE.
                                            FOR FURTHER INFORMATION CALL 1-800-680-8920.
Prospectus Dated: December 15, 2003                                     Statement of Additional Information Dated: December 15, 2003
WFVXT - SIX-PROS- (12/2003)                                                                                           WFVXT -SIXPROS

                            PLEASE SEE OUR PRIVACY POLICY ATTACHED TO THE BACK COVER OF THIS PROSPECTUS.




====================================================================================================================================
If you purchase this  Annuity,  we apply an additional  amount (an XTra  CreditSM) to your account value with each purchase  payment
you make, including your initial purchase payment and any additional purchase payments during the first six annuity years.
====================================================================================================================================
====================================================================================================================================

====================================================================================================================================
4        This Annuity features an annual Insurance  Charge of 0.65% and an annual  Distribution  Charge of 1.00%. We only deduct the
     Distribution  Charge during the first 10 years  following the effective  date of your Annuity.  During the first 10 years,  the
     total asset-based charges on this Annuity are higher than many of our other annuities,  including other annuities we offer that
     apply  credits  to  purchase  payments.  After  the 10th  year,  we only  deduct  the  Insurance  Charge,  making  the  Annuity
     substantially less expensive than most of our other annuities.
====================================================================================================================================
====================================================================================================================================
     Unlike many other  annuities,  the  contingent  deferred sales charge (CDSC) that may apply to a withdrawal or surrender of
     your Annuity is based on the number of years since the effective  date of your Annuity.  We do not assess a separate CDSC based
     on the date that each  purchase  payment is applied.  The CDSC on this Annuity is higher and is deducted for a longer period of
     time as compared to our other  annuities.  As with any investment  product that features a CDSC, you should  consider your need
     to access your account  value during the CDSC period and whether the  liquidity  provision  under the Annuity will satisfy that
     need. The CDSC is only deducted if you make a withdrawal  that exceeds the free  withdrawal  amount or choose to surrender your
     Annuity.  If you make a withdrawal  or surrender  your Annuity  which is subject to a CDSC, we do not recover the XTra CreditSM
     amount.
====================================================================================================================================
====================================================================================================================================
     The XTra  CreditSM  amount is included in your account  value.  However,  American  Skandia may take back the original XTra
     CreditSM amount applied to your purchase  payment if you die, or elect to withdraw all or a portion of your account value under
     the  medically-related  surrender provision,  within 12 months of having received an XTra CreditSM amount. In either situation,
     the value of the XTra  CreditSM  amount could be  substantially  reduced.  However,  any  investment  gain on the XTra CreditSM
     amount will not be taken back.  Additional  conditions and  restrictions  apply. We do not deduct a CDSC in any situation where
     we take back the XTra CreditSM amount.
====================================================================================================================================
====================================================================================================================================
     We offer other  annuities  where we apply an XTra  CreditSM to your annuity with each purchase  payment you make.  The XTra
     CreditSM  amount  we apply to  purchase  payments  on those  annuities  is  generally  less  than on this  Annuity.  The  total
     asset-based  charges on those  annuities  are lower during the first 10 years but are higher than this  Annuity  after the 10th
     year.  The CDSC is also lower and is  deducted  for a shorter  period of time than on this  Annuity;  however the CDSC on those
     annuities applies separately to each purchase payment.
====================================================================================================================================
====================================================================================================================================

WHAT ARE SOME OF THE KEY FEATURES OF THIS ANNUITY?
|X|      This Annuity is a "flexible  premium  deferred  annuity." It is called  "flexible  premium"  because you have  considerable
       flexibility in the timing and amount of premium  payments.  Generally,  investors  "defer"  receiving  annuity payments until
       after an accumulation period.
|X|      This  Annuity  offers  both  variable  and fixed  investment  options.  If you  allocate  your  Account  Value to  variable
       investment  options,  the value of your  Annuity  will vary daily to reflect the  investment  performance  of the  underlying
       investment  options.  Fixed investment  options of different  durations are offered that are guaranteed by us, but may have a
       Market Value Adjustment if you withdraw or transfer your Account Value before the Maturity Date.
|X|      The Annuity features two distinct phases - the accumulation  period and the payout period.  During the accumulation  period
       your Account Value is allocated to one or more investment options.  The variable  investment  options,  each a Sub-account of
       American Skandia Life Assurance  Corporation  Variable Account B, invest in an underlying  mutual fund portfolio.  Currently,
       portfolios of the following  underlying mutual funds are being offered:  Wells Fargo Variable Trust,  American Skandia Trust,
       Gartmore Variable Investment Trust, INVESCO Variable Investment Funds, Inc.,  Evergreen Variable Annuity Trust,  ProFunds VP,
       First Defined Portfolio Fund LLC and The Prudential Series Fund, Inc.
|X|      During the payout period,  commonly called  "annuitization,"  you can elect to receive  annuity  payments (1) for life; (2)
       for life with a  guaranteed  minimum  number  of  payments;  (3)  based on joint  lives;  or (4) for a  guaranteed  number of
       payments.  We currently make annuity payments available on a fixed or variable basis.
|X|      This Annuity  offers a Credit which we add to your Annuity with each  Purchase  Payment we receive in Annuity Years one (1)
       through six (6).
|X|      This Annuity  offers  three  different  optional  Living  Benefit  programs,  for an  additional  charge,  that can provide
       investment protection for Owners while they are alive.
|X|      This Annuity  offers a basic Death  Benefit.  It also offers  optional  Death  Benefits  that provide an enhanced  level of
       protection for your beneficiary(ies) for an additional charge.
|X|      You are allowed to withdraw a limited  amount of money from your  Annuity on an annual  basis  without any  charges.  Other
       product features allow you to access your Account Value as necessary, although a charge may apply.
|X|      Transfers  between  investment  options are tax-free.  Currently,  you may make twenty  transfers each year free of charge.
       We also  offer  several  programs  that  enable you to manage  your  Account  Value as your  financial  needs and  investment
       performance change.




HOW DO I PURCHASE THIS ANNUITY?
We sell the Annuity through licensed,  registered  investment  professionals.  You must complete an application and submit a minimum
initial  purchase  payment of $10,000.  We may allow you to make a lower  initial  purchase  payment  provided you  establish a bank
drafting program under which purchase  payments  received in the first Annuity Year total at least $10,000.  If the Annuity is owned
by an individual or  individuals,  the oldest of those  persons must be age 75 or under.  If the Annuity is owned by an entity,  the
annuitant must be age 75 or under.



                                                         TABLE OF CONTENTS


GLOSSARY OF TERMS..................................................................................................................6


SUMMARY OF CONTRACT FEES AND CHARGES...............................................................................................7


EXPENSE EXAMPLES..................................................................................................................11


INVESTMENT OPTIONS................................................................................................................12

   WHAT ARE THE INVESTMENT OBJECTIVES AND POLICIES OF THE PORTFOLIOS?.............................................................12
   WHAT ARE THE FIXED INVESTMENT OPTIONS?.........................................................................................28

FEES AND CHARGES..................................................................................................................28

   WHAT ARE THE CONTRACT FEES AND CHARGES?........................................................................................28
   WHAT CHARGES APPLY SOLELY TO THE VARIABLE INVESTMENT OPTIONS?..................................................................29
   WHAT CHARGES ARE ASSESSED BY THE PORTFOLIOS?...................................................................................30
   WHAT CHARGES APPLY TO THE FIXED ALLOCATIONS?...................................................................................30
   WHAT CHARGES APPLY IF I CHOOSE AN ANNUITY PAYMENT OPTION?......................................................................30
   EXCEPTIONS/REDUCTIONS TO FEES AND CHARGES......................................................................................30

PURCHASING YOUR ANNUITY...........................................................................................................30

   WHAT ARE OUR REQUIREMENTS FOR PURCHASING THE ANNUITY?..........................................................................30

MANAGING YOUR ANNUITY.............................................................................................................32

   MAY I CHANGE THE OWNER, ANNUITANT AND BENEFICIARY DESIGNATIONS?................................................................32
   MAY I RETURN THE ANNUITY IF I CHANGE MY MIND?..................................................................................32
   MAY I MAKE ADDITIONAL PURCHASE PAYMENTS?.......................................................................................32
   MAY I MAKE SCHEDULED PAYMENTS DIRECTLY FROM MY BANK ACCOUNT?...................................................................32
   MAY I MAKE PURCHASE PAYMENTS THROUGH A SALARY REDUCTION PROGRAM?...............................................................33

MANAGING YOUR ACCOUNT VALUE.......................................................................................................33

   HOW AND WHEN ARE PURCHASE PAYMENTS INVESTED?...................................................................................33
   HOW DO I RECEIVE CREDITS?......................................................................................................33
   HOW ARE CREDITS APPLIED TO MY ACCOUNT VALUE?...................................................................................33
   ARE THERE RESTRICTIONS OR CHARGES ON TRANSFERS BETWEEN INVESTMENT OPTIONS?.....................................................35
   DO YOU OFFER DOLLAR COST AVERAGING?............................................................................................35
   DO YOU OFFER ANY AUTOMATIC REBALANCING PROGRAMS?...............................................................................36
   DO YOU OFFER ANY ASSET ALLOCATION PROGRAMS?....................................................................................36
   DO YOU OFFER A PROGRAM DESIGNED TO GUARANTEE A "RETURN OF PREMIUM" AT A FUTURE DATE?...........................................36
   MAY I AUTHORIZE MY INVESTMENT PROFESSIONAL TO MANAGE MY ACCOUNT?...............................................................37
   HOW DO THE FIXED INVESTMENT OPTIONS WORK?......................................................................................37
   HOW DO YOU DETERMINE RATES FOR FIXED ALLOCATIONS?..............................................................................38
   HOW DOES THE MARKET VALUE ADJUSTMENT WORK?.....................................................................................38
   WHAT HAPPENS WHEN MY GUARANTEE PERIOD MATURES?.................................................................................39

ACCESS TO ACCOUNT VALUE...........................................................................................................39

   WHAT TYPES OF DISTRIBUTIONS ARE AVAILABLE TO ME?...............................................................................39
   ARE THERE TAX IMPLICATIONS FOR DISTRIBUTIONS?..................................................................................40
   CAN I WITHDRAW A PORTION OF MY ANNUITY?........................................................................................40
   HOW MUCH CAN I WITHDRAW AS A FREE WITHDRAWAL?..................................................................................40
   IS THERE A CHARGE FOR A PARTIAL WITHDRAWAL?....................................................................................41
   CAN I MAKE PERIODIC WITHDRAWALS FROM THE ANNUITY DURING THE ACCUMULATION PERIOD?...............................................41
   DO YOU OFFER A PROGRAM FOR WITHDRAWALS UNDER SECTION 72(t) OF THE INTERNAL REVENUE CODE?.......................................42
   WHAT ARE MINIMUM DISTRIBUTIONS AND WHEN WOULD I NEED TO MAKE THEM?.............................................................42
   CAN I SURRENDER MY ANNUITY FOR ITS VALUE?......................................................................................42
   WHAT IS A MEDICALLY-RELATED SURRENDER AND HOW DO I QUALIFY?....................................................................43
   WHAT TYPES OF ANNUITY OPTIONS ARE AVAILABLE?...................................................................................43
   HOW AND WHEN DO I CHOOSE THE ANNUITY PAYMENT OPTION?...........................................................................44
   HOW ARE ANNUITY PAYMENTS CALCULATED?...........................................................................................44

LIVING BENEFIT PROGRAMS...........................................................................................................46

   DO YOU OFFER PROGRAMS DESIGNED TO PROVIDE INVESTMENT PROTECTION FOR OWNERS WHILE THEY ARE
     ALIVE?.......................................................................................................................46
   GUARANTEED RETURN OPTION PlusSM (GRO PlusSM)...................................................................................47
   GUARANTEED MINIMUM WITHDRAWAL BENEFIT (GMWB)...................................................................................52
   Additional Tax Considerations for Qualified Contracts..........................................................................55
   GUARANTEED MINIMUM INCOME BENEFIT (GMIB).......................................................................................56
   Other Important Considerations.................................................................................................58

DEATH BENEFIT.....................................................................................................................59

   WHAT TRIGGERS THE PAYMENT OF A DEATH BENEFIT?..................................................................................59
   Basic Death Benefit............................................................................................................59
   OPTIONAL DEATH BENEFITS........................................................................................................60
   AMERICAN SKANDIA'S ANNUITY REWARDS.............................................................................................62
   PAYMENT OF DEATH BENEFITS......................................................................................................62

VALUING YOUR INVESTMENT...........................................................................................................64

   HOW IS MY ACCOUNT VALUE DETERMINED?............................................................................................64
   WHAT IS THE SURRENDER VALUE OF MY ANNUITY?.....................................................................................64
   HOW AND WHEN DO YOU VALUE THE SUB-ACCOUNTS?....................................................................................64
   HOW DO YOU VALUE FIXED ALLOCATIONS?............................................................................................64
   WHEN DO YOU PROCESS AND VALUE TRANSACTIONS?....................................................................................65
   WHAT HAPPENS TO MY UNITS WHEN THERE IS A CHANGE IN DAILY ASSET-BASED CHARGES?..................................................66

TAX CONSIDERATIONS................................................................................................................66

   WHAT ARE SOME OF THE FEDERAL TAX CONSIDERATIONS OF THIS ANNUITY?...............................................................66
   HOW ARE AMERICAN SKANDIA AND THE SEPARATE ACCOUNTS TAXED?......................................................................66
   IN GENERAL, HOW ARE ANNUITIES TAXED?...........................................................................................66
   HOW ARE DISTRIBUTIONS TAXED?...................................................................................................67
   WHAT TAX CONSIDERATIONS ARE THERE FOR TAX-QUALIFIED RETIREMENT PLANS OR QUALIFIED
     CONTRACTS?...................................................................................................................68
   HOW ARE DISTRIBUTIONS FROM QUALIFIED CONTRACTS TAXED?..........................................................................69
   GENERAL TAX CONSIDERATIONS.....................................................................................................70

GENERAL INFORMATION...............................................................................................................71

   HOW WILL I RECEIVE STATEMENTS AND REPORTS?.....................................................................................71
   WHO IS AMERICAN SKANDIA?.......................................................................................................71
   WHAT ARE SEPARATE ACCOUNTS?....................................................................................................72
   WHAT IS THE LEGAL STRUCTURE OF THE UNDERLYING FUNDS?...........................................................................73
   WHO DISTRIBUTES ANNUITIES OFFERED BY AMERICAN SKANDIA?.........................................................................74
   AVAILABLE INFORMATION..........................................................................................................75
   INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE................................................................................76
   HOW TO CONTACT US..............................................................................................................76
   INDEMNIFICATION................................................................................................................76
   LEGAL PROCEEDINGS..............................................................................................................76
   CONTENTS OF THE STATEMENT OF ADDITIONAL INFORMATION............................................................................77

APPENDIX A - FINANCIAL INFORMATION ABOUT AMERICAN SKANDIA..........................................................................1


AUDITED CONSOLIDATED FINANCIAL STATEMENTS OF AMERICAN SKANDIA LIFE ASSURANCE CORPORATION..........................................11


APPENDIX B - CONDENSED FINANCIAL INFORMATION ABOUT SEPARATE ACCOUNT B..............................................................1


APPENDIX C - CALCULATION OF OPTIONAL DEATH BENEFITS................................................................................1



                                                         GLOSSARY OF TERMS

Many terms used within this  Prospectus  are described  within the text where they appear.  The  description  of those terms are not
repeated in this Glossary of Terms.

Account Value:  The value of each  allocation to a Sub-account or a Fixed  Allocation  prior to the Annuity Date, plus any earnings,
and/or less any losses,  distributions  and charges.  The Account Value is  calculated  before we assess any  applicable  Contingent
Deferred  Sales  Charge  ("CDSC")  and/or any Annual  Maintenance  Fee.  The Account  Value  includes any Credits we applied to your
Purchase  Payments that we are entitled to recover  under certain  circumstances.  The Account  Value is determined  separately  for
each  Sub-account  and for each Fixed  Allocation,  and then totaled to determine  the Account  Value for your entire  Annuity.  The
Account Value of each Fixed Allocation on other than its Maturity Date may be calculated using a market value adjustment.

Annuitization:  The  application  of Account Value to one of the  available  annuity  options for the  Annuitant to begin  receiving
periodic payments for life, for a guaranteed minimum number of payments or for life with a guaranteed minimum number of payments.

Annuity Date: The date you choose for annuity payments to commence.  A maximum Annuity Date may apply.

Annuity Year: A 12-month period commencing on the Issue Date of the Annuity and each successive 12-month period thereafter.

Code: The Internal Revenue Code of 1986, as amended from time to time.

Fixed  Allocation:  An allocation of Account Value that is to be credited a fixed rate of interest for a specified  Guarantee Period
during the accumulation period.

Guarantee Period: A period of time during the accumulation period where we credit a fixed rate of interest on a Fixed Allocation.

Interim  Value:  The value of a Fixed  Allocation  on any date other  than the  Maturity  Date.  The  Interim  Value is equal to the
initial value allocated to the Fixed Allocation plus all interest  credited to the Fixed Allocation as of the date calculated,  less
any transfers or withdrawals from the Fixed Allocation.

Issue Date: The effective date of your Annuity.

MVA: A market  value  adjustment  used in the  determination  of Account  Value of each Fixed  Allocation  on any day other than the
Maturity Date of such Fixed Allocation.

Owner: With an Annuity issued as an individual  annuity  contract,  the Owner is either an eligible entity or person named as having
ownership rights in relation to the Annuity.  With an Annuity issued as a certificate  under a group annuity  contract,  the "Owner"
refers to the person or entity who has the rights and benefits designated as to the "Participant" in the certificate.

Surrender  Value:  The value of your Annuity  available upon surrender  prior to the Annuity Date. It equals the Account Value as of
the date we price the  surrender  minus any  applicable  CDSC,  Annual  Maintenance  Fee,  Tax Charge,  the charge for any  optional
benefits.

Unit:  A measure used to calculate your Account Value in a Sub-account during the accumulation period.

Valuation Day:  Every day the New York Stock  Exchange is open for trading or any other day the  Securities and Exchange  Commission
requires mutual funds or unit investment trusts to be valued.



SUMMARY OF CONTRACT FEES AND CHARGES

Below is a summary of the fees and charges for the  Annuity.  Some fees and charges are assessed  against your Annuity  while others
are assessed  against  assets  allocated  to the variable  investment  options.  The fees and charges that are assessed  against the
Annuity  include the  Contingent  Deferred  Sales  Charge,  Transfer Fee and Annual  Maintenance  Fee. The charges that are assessed
against the variable  investment options are the Insurance Charge,  which is the combination of a mortality and expense risk charge,
a charge for  administration  of the Annuity,  the Distribution  Charge,  and the charge for any optional  benefits you elect.  Each
underlying  mutual fund portfolio  assesses a charge for investment  management,  other expenses and with some mutual funds, a 12b-1
charge.  The prospectus for each  underlying  mutual fund provides more detailed  information  about the expenses for the underlying
mutual funds.  Tax charges may vary by state and in certain  states,  a premium tax charge may be applicable.  All of these fees and
charges are described in more detail within this Prospectus.

The  following  table  provides a summary of the fees and charges you will incur if you  surrender  the Annuity or transfer  Account
Value among investment options.  These fees and charges are described in more detail within this Prospectus.

- ----------------------------------------------------------------------------------------------------------------------------------------
                                                   YOUR TRANSACTION FEES AND CHARGES
                                                    (assessed against the Annuity)
- ----------------------------------------------------------------------------------------------------------------------------------------
- ------------------------- --------------------------------------------------------------------------------------------------------------
       FEE/CHARGE                                                        Amount Deducted
- ------------------------- --------------------------------------------------------------------------------------------------------------
- -------------------------
Contingent Deferred                                                           9.0%
Sales Charge*               The charge is a percentage of each applicable Purchase Payment deducted upon surrender or withdrawal. The
                                                     period is measured from the Issue Date of the Annuity.
- ------------------------- --------------------------------------------------------------------------------------------------------------
- -------------------------
Transfer Fee                                                                 $10.00
                                                      (Deducted after the 20th transfer each Annuity Year)
- ------------------------- --------------------------------------------------------------------------------------------------------------

*    The following are the Contingent  Deferred Sales Charges (as a percentage of each applicable  Purchase  Payment) upon surrender
or withdrawal.

                        -------- ------ ------ ----- ------ ------ ----- ------ ------ ------ --------
                        Yr. 1   Yr. 2  Yr. 3  Yr.   Yr. 5  Yr. 6  Yr.   Yr. 8  Yr. 9  Yr.    Yr. 11+
                                                4                   7                  10
                        -------- ------ ------ ----- ------ ------ ----- ------ ------ ------ --------
                        -------- ------ ------ ----- ------ ------ ----- ------ ------ ------ --------
                         9.0%    9.0%   8.5%   8.0%  7.0%   6.0%   5.0%  4.0%   3.0%   2.0%   0.0%
                        -------- ------ ------ ----- ------ ------ ----- ------ ------ ------ --------

The  following  table  provides a summary of the periodic  fees and charges you will incur while you own the Annuity,  excluding the
underlying mutual fund Portfolio annual expenses.  These fees and charges are described in more detail within this Prospectus.

- ----------------------------------------------------------------------------------------------------------------------------------------
                                                    YOUR PERIODIC FEES AND CHARGES
- ----------------------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------- -------------------------------------------- --------------------------------------------
                                                            AMOUNT DEDUCTED/
                 FEE/EXPENSE                              DESCRIPTION OF CHARGE                            WHEN DEDUCTED
- ---------------------------------------------- -------------------------------------------- --------------------------------------------
- ---------------------------------------------- -------------------------------------------- --------------------------------------------
Premium Tax Charge                                 Depends on the requirements of the                         Various
                                                         applicable jurisdiction

============================================== ============================================ ============================================
- ----------------------------------------------------------------------------------------------------------------------------------------
                                           ANNUAL FEES/CHARGES ASSESSED AGAINST THE ANNUITY
- ----------------------------------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------- ------------------------------------------------------------------
                             FEE/CHARGE                                                        Amount Deducted
- --------------------------------------------------------------------- ------------------------------------------------------------------
- --------------------------------------------------------------------- ------------------------------------------------------------------
Annual Maintenance Fee                                                              Smaller of $35 or 2% of Account Value
                                                                        (Assessed annually on the Annuity's anniversary date or upon
                                                                                                 surrender)
- --------------------------------------------------------------------- ------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------------------------------------
                                               ANNUAL FEES/CHARGES OF THE SUB-ACCOUNTS*
                                 (as a percentage of the average daily net assets of the Sub-accounts)
- --------------------------------------------------------------------- ------------------------------------------------------------------
                             FEE/CHARGE                                                        Amount Deducted
- --------------------------------------------------------------------- ------------------------------------------------------------------
Mortality & Expense Risk Charge                                                                     0.50%
- --------------------------------------------------------------------- ------------------------------------------------------------------
Administration Charge                                                                               0.15%
- --------------------------------------------------------------------- ------------------------------------------------------------------
- --------------------------------------------------------------------- ------------------------------------------------------------------
Distribution Charge**                                                                    1.00% in Annuity Years 1-10
- --------------------------------------------------------------------- ------------------------------------------------------------------
- --------------------------------------------------------------------- ------------------------------------------------------------------
Total Annual Charges of the Sub-accounts***                           1.65% per year of the value of each Sub-account in Annuity Years
                                                                                                  1-10****
- --------------------------------------------------------------------- ------------------------------------------------------------------
*    These charges are deducted daily and apply to Variable Investment Options only.
**   The Distribution Charge in Annuity Years 11+ is 0.00%.
***  The combination of the Mortality and Expense Risk Charges and  Administration  Charge is referred to as the "Insurance  Charge"
elsewhere in this Prospectus.
**** The Total Annual Charges of the Sub-accounts in Annuity Years 11+ are 0.65% per year of the value of each Sub-account.


The  following  table  provides  a  summary  of the fees and  charges  you will  incur if you elect  any of the  following  optional
benefits.  These fees and charges are described in more detail within this Prospectus.

- ----------------------------------------------------------------------------------------------------------------------------------------
                                                YOUR OPTIONAL BENEFIT FEES AND CHARGES
- ----------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------- --------------------- ----------------------
                                     Optional Benefit                                         Optional Benefit    Total Annual Charge*
                                                                                                    Fee/
                                                                                                   Charge
- ------------------------------------------------------------------------------------------- --------------------- ----------------------
- ------------------------------------------------------------------------------------------- --------------------- ----------------------
GUARANTEED RETURN OPTION PlusSM (GRO PlusSM) (or GRO where GRO PlusSM is not available)
We offer a program  that  guarantees  a  "return  of  premium"  at a future  date,  while     0.25% of average    1.90% in Annuity
allowing you to allocate all or a portion of your Account Value to certain Sub-accounts.    daily net assets of   Years 1-10
                                                                                              the Sub-accounts
- ------------------------------------------------------------------------------------------- --------------------- ----------------------
- ------------------------------------------------------------------------------------------- --------------------- ----------------------
GUARANTEED MINIMUM WITHDRAWAL BENEFIT (GMWB)
We offer a program that guarantees  your ability to withdraw  amounts equal to an initial     0.35% of average    2.00% in Annuity
principal value, regardless of the impact of market performance on your Account Value.      daily net assets of   Years 1-10
                                                                                              the Sub-accounts
- ------------------------------------------------------------------------------------------- --------------------- ----------------------
- ------------------------------------------------------------------------------------------- --------------------- ----------------------
GUARANTEED MINIMUM INCOME BENEFIT (GMIB)                                                     0.50% per year of    1.65% in Annuity
We offer a program that,  after a seven-year  waiting period,  guarantees your ability to       the average       Years 1-10
begin  receiving  income  from your  Annuity in the form of annuity  payments  based on a     Protected Income            PLUS
guaranteed  minimum value (called the "Protected  Income Value") that increases after the     Value; deducted     0.50% per year of
waiting  period  begins,  regardless of the impact of market  performance on your Account   annually in arrears   average Protected
Value.                                                                                       each Annuity Year    Income Value
- ------------------------------------------------------------------------------------------- --------------------- ----------------------
- ------------------------------------------------------------------------------------------- --------------------- ----------------------
ENHANCED BENEFICIARY PROTECTION DEATH BENEFIT                                                                       1.90% in Annuity
We offer an Optional  Death  Benefit that provides an enhanced  level of  protection  for     0.25% of average         Years 1-10
your  beneficiary(ies)  by providing  amounts in addition to the basic Death Benefit that   daily net assets of
can be used to offset  federal  and state  taxes  payable  on any  taxable  gains in your     the Sub-accounts
Annuity at the time of your death.
- ------------------------------------------------------------------------------------------- --------------------- ----------------------
- ------------------------------------------------------------------------------------------- --------------------- ----------------------
HIGHEST ANNIVERSARY VALUE DEATH BENEFIT                                                                             1.90% in Annuity
We offer an Optional  Death  Benefit that provides an enhanced  level of  protection  for     0.25% of average         Years 1-10
your  beneficiary(ies)  by  providing a death  benefit  equal to the greater of the basic   daily net assets of
Death Benefit or the Highest Anniversary Value.                                               the Sub-accounts
- ------------------------------------------------------------------------------------------- --------------------- ----------------------
- ----------------------------------------------------------------------------------------------------------------------------------------
Please  refer to the section of this  Prospectus  that  describes  each  optional  benefit for a complete  description  of the benefit,
including any restrictions or limitations that may apply.
- ----------------------------------------------------------------------------------------------------------------------------------------
*    The Total Annual Charge includes the Insurance Charge and Distribution Charge assessed against the Annuity.  If you were to
     elect more than one optional benefit, the Total Annual Charge would be increased to include the charge for the optional
     benefit.  The Total Annual Charge for each optional benefit in Annuity Years 11+ will be 0.90% (1.00% with respect to GMWB;
     and 0.65% annually plus 0.50% per year of average Protected Income Value for GMIB).

The  following  table  provides  the range  (minimum  and maximum) of the total  annual  expenses  for the  underlying  mutual funds
("Portfolios")  as of December 31, 2002.  Each figure is stated as a percentage  of the  underlying  Portfolio's  average  daily net
assets.

- ----------------------------------------------------------------------------------------------------------------------------------------
                                               Total Annual Portfolio Operating Expenses
- ----------------------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------- -------------------------------------------- --------------------------------------------
                                                                 Minimum                                      Maximum
- ---------------------------------------------- -------------------------------------------- --------------------------------------------
- ---------------------------------------------- -------------------------------------------- --------------------------------------------
Total Portfolio Operating Expense                                0.14% *                                       3.14%
- ---------------------------------------------- -------------------------------------------- --------------------------------------------
*    The minimum total annual  portfolio  operating  expenses are those of a Portfolio  that may invest in mutual funds,  which also
     charge their own operating expenses.  Thus, the total annual portfolio operating expenses may be higher than indicated.




The following are the investment  management  fees,  other  expenses,  12b-1 fees (if  applicable) and the total annual expenses for
each underlying  mutual fund  ("Portfolio") as of December 31, 2002,  except as noted.  Each figure is stated as a percentage of the
underlying  Portfolio's  average daily net assets.  For certain of the  underlying  Portfolios,  a portion of the  management fee is
being waived and/or other  expenses are being  partially  reimbursed.  "N/A"  indicates that no portion of the management fee and/or
other expenses is being waived and/or  reimbursed.  The "Net Annual  Portfolio  Operating  Expenses"  reflect the combination of the
underlying  Portfolio's  investment  management  fee,  other  expenses  and any  12b-1  fees,  net of any fee  waivers  and  expense
reimbursements.  The  following  expenses are deducted by the  underlying  Portfolio  before it provides  American  Skandia with the
daily net asset  value.  Any  footnotes  about  expenses  appear  after the list of all the  Portfolios.  The  underlying  Portfolio
information  was provided by the underlying  mutual funds and has not been  independently  verified by us. See the  prospectuses  or
statements of additional  information of the  underlying  Portfolios for further  details.  The current  prospectus and statement of
additional information for the underlying Portfolios can be obtained by calling 1-800-680-8920.

- ---------------------------------------------------------------------------------------------------------------------------------------
                                           UNDERLYING MUTUAL FUND PORTFOLIO ANNUAL EXPENSES
                               (as a percentage of the average net assets of the underlying Portfolios)
- ---------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------- --------------- ------------- -------------- ------------- ------------ -------------
                                                    Management     Other         12b-1 Fees    Total Annual   Fee          Net
                                                       Fees         Expenses                    Portfolio    Waivers       Annual
              UNDERLYING PORTFOLIO                                                              Operating    and           Portfolio
                                                                                                 Expenses    Expense       Operating
                                                                                                             Reimburse-mentExpenses

- ---------------------------------------------------------------------------------------------------------------------------------------
Wells Fargo Variable Trust:
  International Equity                                0.75%          2.14%         0.25%          3.14%        2.14%         1.00%
  Small Cap Growth                                    0.75%          0.33%         0.25%          1.33%        0.13%         1.20%
  Growth                                              0.55%          0.35%         0.25%          1.15%        0.15%         1.00%
  Large Company Growth                                0.55%          0.29%         0.25%          1.09%        0.09%         1.00%
  Equity Value                                        0.55%          0.48%         0.25%          1.28%        0.28%         1.00%
  Equity Income                                       0.55%          0.30%         0.25%          1.10%        0.10%         1.00%
  Asset Allocation                                    0.55%          0.23%         0.25%          1.03%        0.03%         1.00%
  Total Return Bond 1                                 0.45%          0.33%         0.25%          1.03%        0.13%         0.90%

American Skandia Trust: 2
  AST Strong International Equity                     0.88%          0.21%          0.12%         1.21%         0.00%        1.21%
  AST William Blair International Growth              1.00%          0.23%          0.10%         1.33%         0.10%        1.23%
  AST American Century International Growth           1.00%          0.25%          0.00%         1.25%         0.00%        1.25%
  AST DeAM International Equity                       1.00%          0.44%          0.00%         1.44%         0.15%        1.29%
  AST MFS Global Equity                               1.00%          0.41%          0.00%         1.41%         0.00%        1.41%
  AST PBHG Small-Cap Growth                           0.90%          0.22%          0.11%         1.23%         0.00%        1.23%
  AST DeAM Small-Cap Growth                           0.95%          0.20%          0.00%         1.15%         0.15%        1.00%
  AST Federated Aggressive Growth                     0.95%          0.43%          0.00%         1.38%         0.03%        1.35%
  AST Gabelli Small-Cap Value                         0.90%          0.19%          0.01%         1.10%         0.00%        1.10%
  AST DeAM Small-Cap Value                            0.95%          0.53%          0.00%         1.48%         0.33%        1.15%
  AST Goldman Sachs Mid-Cap Growth                    1.00%          0.26%          0.07%         1.33%         0.10%        1.23%
  AST Neuberger Berman Mid-Cap Growth                 0.90%          0.20%          0.06%         1.16%         0.00%        1.16%
  AST Neuberger Berman Mid-Cap Value                  0.90%          0.17%          0.09%         1.16%         0.00%        1.16%
  AST Alger All-Cap Growth                            0.95%          0.19%          0.15%         1.29%         0.00%        1.29%
  AST Gabelli All-Cap Value                           0.95%          0.24%          0.00%         1.19%         0.00%        1.19%
  AST T. Rowe Price Natural Resources                 0.90%          0.23%          0.03%         1.16%         0.00%        1.16%
  AST Alliance Growth                                 0.90%          0.20%          0.03%         1.13%         0.00%        1.13%
  AST MFS Growth                                      0.90%          0.18%          0.10%         1.18%         0.00%        1.18%
  AST Marsico Capital Growth                          0.90%          0.16%          0.04%         1.10%         0.01%        1.09%
  AST Goldman Sachs Concentrated Growth               0.90%          0.15%          0.04%         1.09%         0.06%        1.03%
  AST DeAM Large-Cap Growth                           0.85%          0.23%          0.00%         1.08%         0.10%        0.98%
  AST DeAM Large-Cap Value                            0.85%          0.24%          0.04%         1.13%         0.10%        1.03%
  AST Alliance/Bernstein Growth + Value               0.90%          0.23%          0.00%         1.13%         0.00%        1.13%
  AST Sanford Bernstein Core Value                    0.75%          0.25%          0.00%         1.00%         0.00%        1.00%
  AST Cohen & Steers Realty                           1.00%          0.23%          0.03%         1.26%         0.00%        1.26%
  AST Sanford Bernstein Managed Index 500             0.60%          0.16%          0.08%         0.84%         0.00%        0.84%
  AST American Century Income & Growth                0.75%          0.23%          0.00%         0.98%         0.00%        0.98%
  AST Alliance Growth and Income                      0.75%          0.15%          0.08%         0.98%         0.02%        0.96%
  AST MFS Growth with Income                          0.90%          0.28%          0.01%         1.19%         0.00%        1.19%
  AST INVESCO Capital Income                          0.75%          0.17%          0.03%         0.95%         0.00%        0.95%
- ---------------------------------------------------------------------------------------------------------------------------------------
                                           UNDERLYING MUTUAL FUND PORTFOLIO ANNUAL EXPENSES
                               (as a percentage of the average net assets of the underlying Portfolios)
- ---------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------- --------------- ------------- -------------- ------------- ------------ -------------
                                                    Management     Other         12b-1 Fees    Total Annual   Fee          Net
                                                       Fees         Expenses                    Portfolio    Waivers       Annual
              UNDERLYING PORTFOLIO                                                              Operating    and           Portfolio
                                                                                                 Expenses    Expense       Operating
                                                                                                             Reimbursement Expenses
- ------------------------------------------------- --------------- ------------- -------------- ------------- ------------ -------------
- ------------------------------------------------- --------------- ------------- -------------- ------------- ------------ -------------
  AST DeAM Global Allocation                          0.10%          0.04%          0.00%         0.14%         0.00%        0.14%
  AST American Century Strategic Balanced             0.85%          0.25%          0.00%         1.10%         0.00%        1.10%
  AST T. Rowe Price Asset Allocation                  0.85%          0.26%          0.00%         1.11%         0.00%        1.11%
  AST T. Rowe Price Global Bond                       0.80%          0.26%          0.00%         1.06%         0.00%        1.06%
  AST Federated High Yield                            0.75%          0.19%          0.00%         0.94%         0.00%        0.94%
  AST Lord Abbett Bond-Debenture                      0.80%          0.24%          0.00%         1.04%         0.00%        1.04%
  AST DeAM Bond                                       0.85%          0.23%          0.00%         1.08%         0.15%        0.93%
  AST PIMCO Total Return Bond                         0.65%          0.15%          0.00%         0.80%         0.02%        0.78%
  AST PIMCO Limited Maturity Bond                     0.65%          0.18%          0.00%         0.83%         0.00%        0.83%
  AST Money Market                                    0.50%          0.13%          0.00%         0.63%         0.05%        0.58%

Gartmore Variable Investment Trust:
  GVIT Developing Markets                             1.15%          0.24%           0.25%         1.64%        0.00%        1.64%

INVESCO Variable Investment Funds, Inc.:
  Dynamics                                             0.75%         0.37%           0.00%         1.12%         0.00%        1.12%
  Technology                                           0.75%         0.36%           0.00%         1.11%         0.00%        1.11%
  Health Sciences                                      0.75%         0.32%           0.00%         1.07%         0.00%        1.07%
  Financial Services                                   0.75%         0.34%           0.00%         1.09%         0.00%        1.09%
  Telecommunications                                   0.75%         0.47%           0.00%         1.22%         0.00%        1.22%

Evergreen Variable Annuity Trust:
  International Equity3                                0.66%         0.39%           0.00%         1.05%         0.00%        1.05%
  Special Equity                                       0.92%         0.26%           0.00%         1.18%         0.15%        1.03%
  Omega                                                0.52%         0.18%           0.00%         0.70%         0.00%        0.70%

ProFund VP:
  Europe 30                                            0.75%         1.03%           0.25%         2.03%         0.05%        1.98%
  Asia 30                                              0.75%         1.03%           0.25%         2.03%         0.05%        1.98%
  Japan                                                0.75%         1.06%           0.25%         2.06%         0.08%        1.98%
  Banks                                                0.75%         1.11%           0.25%         2.11%         0.13%        1.98%
  Basic Materials                                      0.75%         1.21%           0.25%         2.21%         0.23%        1.98%
  Biotechnology                                        0.75%         1.16%           0.25%         2.16%         0.18%        1.98%
  Consumer Cyclical                                    0.75%         1.65%           0.25%         2.65%         0.67%        1.98%
  Consumer Non-Cyclical                                0.75%         1.10%           0.25%         2.10%         0.12%        1.98%
  Energy                                               0.75%         1.16%           0.25%         2.16%         0.18%        1.98%
  Financial                                            0.75%         1.14%           0.25%         2.14%         0.16%        1.98%
  Healthcare                                           0.75%         1.14%           0.25%         2.14%         0.16%        1.98%
  Industrial                                           0.75%         1.65%           0.25%         2.65%         0.67%        1.98%
  Internet                                             0.75%         1.04%           0.25%         2.04%         0.06%        1.98%
  Pharmaceuticals                                      0.75%         1.12%           0.25%         2.12%         0.14%        1.98%
  Precious Metals                                      0.75%         0.98%           0.25%         1.98%          N/A         1.98%
  Real Estate                                          0.75%         1.13%           0.25%         2.13%         0.15%        1.98%
  Semiconductor                                        0.75%         1.33%           0.25%         2.33%         0.35%        1.98%
  Technology                                           0.75%         1.27%           0.25%         2.27%         0.29%        1.98%
  Telecommunications                                   0.75%         1.19%           0.25%         2.19%         0.21%        1.98%
  Utilities                                            0.75%         1.17%           0.25%         2.17%         0.19%        1.98%
  Bull                                                 0.75%         0.91%           0.25%         1.91%          N/A         1.91%
  Bear                                                 0.75%         1.03%           0.25%         2.03%         0.05%        1.98%
  UltraBull 4                                          0.75%         1.12%           0.25%         2.12%         0.27%        1.85%
  OTC                                                  0.75%         1.03%           0.25%         2.03%         0.05%        1.98%
  Short OTC                                            0.75%         0.96%           0.25%         1.96%          N/A         1.96%
  UltraOTC                                             0.75%         1.08%           0.25%         2.08%         0.13%        1.95%
  Mid-Cap Value                                        0.75%         1.25%           0.25%         2.25%         0.27%        1.98%
  Mid-Cap Growth                                       0.75%         1.22%           0.25%         2.22%         0.24%        1.98%
- ------------------------------------------------- --------------- ------------- -------------- ------------- ------------ -------------



- ---------------------------------------------------------------------------------------------------------------------------------------
                                           UNDERLYING MUTUAL FUND PORTFOLIO ANNUAL EXPENSES
                               (as a percentage of the average net assets of the underlying Portfolios)
- ---------------------------------------------------------------------------------------------------------------------------------------
- ------------------------------------------------- --------------- ------------- -------------- ------------- ------------ -------------
                                                    Management     Other         12b-1 Fees    Total Annual   Fee          Net
                                                       Fees         Expenses                    Portfolio    Waivers       Annual
              UNDERLYING PORTFOLIO                                                              Operating    and           Portfolio
                                                                                                 Expenses    Expense       Operating
                                                                                                             Reimbursement Expenses
- ------------------------------------------------- --------------- ------------- -------------- ------------- ------------ -------------
- ------------------------------------------------- --------------- ------------- -------------- ------------- ------------ -------------
  UltraMid-Cap                                         0.75%         1.36%           0.25%         2.36%         0.38%        1.98%
  Small-Cap Value                                      0.75%         1.45%           0.25%         2.45%         0.47%        1.98%
  Small-Cap Growth                                     0.75%         1.20%           0.25%         2.20%         0.22%        1.98%
  UltraSmall-Cap                                       0.75%         1.15%           0.25%         2.15%         0.17%        1.98%
  U.S. Government Plus                                 0.50%         0.96%           0.25%         1.71%          N/A         1.71%
  Rising Rates Opportunity                             0.75%         1.13%           0.25%         2.13%         0.15%        1.98%

First Defined Portfolio Fund LLC:
  First Trust(R)10 Uncommon Values                     0.60%          2.29%          0.25%         3.14%         1.95%        1.37%

The Prudential Series Fund, Inc.:
SP Jennison International Growth                      0.85%          0.70%          0.25%         1.80%         0.16%        1.64%
- ------------------------------------------------- --------------- ------------- -------------- ------------- ------------ -------------

1        Effective  May 1, 2003,  the Wells  Fargo  Variable  Trust  Corporate  Bond  portfolio  changed its name to the Wells Fargo
     Variable Trust Total Return Bond portfolio.  The name change was made in conjunction with a change in investment strategy.
2        The  Investment  Manager of American  Skandia  Trust (the  "Trust") has agreed to  reimburse  and/or waive fees for certain
     Portfolios  until at least April 30, 2004. The caption "Total Annual  Portfolio  Operating  Expenses"  reflects the Portfolios'
     fees and expenses before such waivers and reimbursements,  while the caption "Net Annual Portfolio Operating Expenses" reflects
     the effect of such waivers and  reimbursements.  The Trust adopted a  Distribution  Plan (the  "Distribution  Plan") under Rule
     12b-1 of the  Investment  Company Act of 1940 to permit an affiliate  of the Trust's  Investment  Manager to receive  brokerage
     commissions in connection with purchases and sales of securities held by Portfolios of the Trust, and to use these  commissions
     to promote  the sale of shares of such  Portfolios.  While the  brokerage  commission  rates and  amounts  paid by the  various
     Portfolios  are not  expected  to increase as a result of the  Distribution  Plan,  the staff of the  Securities  and  Exchange
     Commission takes the position that commission  amounts received under the Distribution Plan should be reflected as distribution
     expenses of the Portfolios.  The Distribution Fee estimates are derived and annualized from data regarding  commission  amounts
     directed under the Distribution  Plan.  Although there are no maximum amounts  allowable,  actual  commission  amounts directed
     under the Distribution  Plan will vary and the amounts  directed during the last full fiscal year of the Plan's  operations may
     differ from the amounts listed in the above chart.
3        On December 5, 2003, all of the assets of the Evergreen  Variable  Annuity Trust Global Leaders  portfolio were transferred
     to the Evergreen Variable Annuity Trust  International  Equity portfolio ("the Merger").  The annual expenses are based on what
     the estimated  combined expenses of the International  Equity would have been for the 12 months ended June 30, 2003. The annual
     expenses of the International  Equity portfolio prior to the Merger were as follows:  Management Fee: 0.66%;  12b1-Fee:  0.00%;
     Other Expenses 0.73%;  Total Annual  Portfolio  Operating  Expenses:  1.39%; Fee Waiver and Expense  Reimbursement:  0.39%; Net
     Annual Portfolio Operating Expenses:  1.00%.
4        Effective  May 1, 2003,  the ProFunds VP Bull Plus  portfolio  changed its name to ProFund VP UltraBull to reflect a change
     in its investment objective.

EXPENSE EXAMPLES
These  examples  are  designed to assist you in  understanding  the various  expenses  you may incur with the Annuity  over  certain
periods of time based on specific  assumptions.  The examples  reflect the  Contingent  Deferred  Sales Charges  (when  applicable),
Annual Maintenance Fee, Insurance Charge,  Distribution  Charge (when applicable),  and the maximum total annual portfolio operating
expenses for the underlying  Portfolio  (shown above),  as well as the charges for the optional  benefits that are offered under the
Annuity.  The Securities and Exchange Commission ("SEC") requires these examples.

Below are  examples  showing  what you would pay in  expenses at the end of the stated time  periods  for each  Sub-account  had you
invested $10,000 in the Annuity and received a 5% annual return on assets, and elected all optional benefits available.

The examples  shown assume that:  (a) you only allocate  Account Value to the  Sub-account  with the maximum total annual  portfolio
operating expenses for the underlying  Portfolio (shown above),  not to a Fixed Allocation;  (b) the Insurance Charge is assessed as
0.65% per year;  (c) the  Distribution  Charge is  assessed as 1.00% per year in Annuity  Years 1 - 10. The Expense  Examples do not
take into  account  that the  Distribution  Charge is not  assessed  in Annuity  Years 11+;  (d) the  Annual  Maintenance  Fee (when
applicable)  is reflected as an  asset-based  charge based on an assumed  average  contract  size;  (e) you make no  withdrawals  of
Account Value during the period shown; (f) you make no transfers,  withdrawals,  surrender or other transactions for which we charge
a fee during the period  shown;  (g) no tax charge  applies;  (h) the maximum  total  annual  portfolio  operating  expenses for the
underlying  Portfolio  (shown above) are reflected;  (i) the charge for each optional  benefit is reflected as an additional  charge
equal to 0.25% per year,  respectively,  for the Guaranteed  Return Option Plus, the Enhanced  Beneficiary  Protection Death Benefit
and the Highest  Anniversary  Value Death  Benefit  and 0.35% for the  Guaranteed  Minimum  Withdrawal  Benefit;  and (j) the Credit
applicable  to your  Annuity is 6% of Purchase  Payments.  Amounts  shown in the  examples  are rounded to the nearest  dollar.  The
Credit we apply to Purchase Payments received after the first Annuity Year are less than 6% (see "How do I Receive Credits?").

The Expense Examples do not reflect a charge for the Guaranteed Minimum Income Benefit, which is deducted annually in arrears.

Expense  Examples  are  provided as follows:  1.) if you  surrender  the  Annuity at the end of the stated time  period;  2.) if you
annuitize at the end of the stated time period; and 3.) if you do not surrender your Annuity.

THE EXAMPLES ARE  ILLUSTRATIVE  ONLY - THEY SHOULD NOT BE CONSIDERED A  REPRESENTATION  OF PAST OR FUTURE EXPENSES OF THE UNDERLYING
MUTUAL FUNDS OR THEIR  PORTFOLIOS - ACTUAL  EXPENSES WILL BE LESS THAN THOSE SHOWN IF YOU DO NOT ELECT ALL OF THE OPTIONAL  BENEFITS
AVAILABLE OR IF YOU ALLOCATE ACCOUNT VALUE TO ANY OTHER AVAILABLE SUB-ACCOUNTS.

If you surrender your contract at the end of the applicable time period:

            ----------------------------- --------------------------- --------------------------- --------------------------
                       1 year                      3 years                     5 years                    10 years
            ----------------------------- --------------------------- --------------------------- --------------------------
            ----------------------------- --------------------------- --------------------------- --------------------------
                       $1,496                       $2,693                      $3,769                     $6,236
            ----------------------------- --------------------------- --------------------------- --------------------------


If you annuitize at the end of the applicable time period (you may not annuitize in the first three (3) Annuity Years):

            ----------------------------- --------------------------- --------------------------- --------------------------
                       1 year                      3 years                     5 years                    10 years
            ----------------------------- --------------------------- --------------------------- --------------------------
            ----------------------------- --------------------------- --------------------------- --------------------------
                        N/A                          N/A                        $3,097                     $6,044
            ----------------------------- --------------------------- --------------------------- --------------------------

If you do not surrender your contract:

            ----------------------------- --------------------------- --------------------------- --------------------------
                       1 year                      3 years                     5 years                    10 years
            ----------------------------- --------------------------- --------------------------- --------------------------
            ----------------------------- --------------------------- --------------------------- --------------------------
                        $632                        $1,877                      $3,097                     $6,044
            ----------------------------- --------------------------- --------------------------- --------------------------


INVESTMENT OPTIONS

WHAT ARE THE INVESTMENT OBJECTIVES AND POLICIES OF THE PORTFOLIOS?

Each variable  investment option is a Sub-account of American Skandia Life Assurance  Corporation  Variable Account B (see "What are
Separate  Accounts" for more detailed  information.)  Each Sub-account  invests  exclusively in one Portfolio.  You should carefully
read the prospectus for any Portfolio in which you are interested.  The following chart  classifies each of the Portfolios  based on
our  assessment  of their  investment  style (as of the date of this  Prospectus).  The chart also  provides a  description  of each
Portfolio's  investment  objective (in italics) and a short,  summary description of their key policies to assist you in determining
which Portfolios may be of interest to you. There is no guarantee that any underlying Portfolio will meet its investment objective.

The name of the  advisor/sub-advisor  for each Portfolio  appears next to the description.  Those Portfolios whose name includes the
prefix "AST" are Portfolios of American Skandia Trust. The investment  managers for AST are American  Skandia  Investment  Services,
Incorporated,  an affiliated  company of American Skandia and Prudential  Investments LLC. However,  a sub-advisor,  as noted below,
is engaged to conduct day-to-day investment decisions.

The Portfolios are not publicly traded mutual funds.  They are only available as investment  options in variable  annuity  contracts
and variable  life  insurance  policies  issued by insurance  companies,  or in some cases,  to  participants  in certain  qualified
retirement  plans.  However,  some of the Portfolios  available as Sub-accounts  under the Annuity are managed by the same portfolio
advisor or  sub-advisor  as a retail  mutual fund of the same or similar name that the  Portfolio may have been modeled after at its
inception.  Certain retail mutual funds may also have been modeled after a Portfolio.  While the  investment  objective and policies
of the retail  mutual  funds and the  Portfolios  may be  substantially  similar,  the  actual  investments  will  differ to varying
degrees.  Differences  in the  performance  of the funds can be  expected,  and in some cases could be  substantial.  You should not
compare the  performance  of a publicly  traded mutual fund with the  performance  of any  similarly  named  Portfolio  offered as a
Sub-account.  Details about the  investment  objectives,  policies,  risks,  costs and management of the Portfolios are found in the
prospectuses  for the underlying  mutual funds.  The current  prospectus and statement of additional  information for the underlying
Portfolios can be obtained by calling 1-800-680-6920.

Please refer to Appendix B for certain required financial information related to the historical performance of the Sub-accounts.




- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      STYLE/                                        INVESTMENT OBJECTIVES/POLICIES                                         PORTFOLIO
       TYPE                                                                                                                 ADVISOR/
                                                                                                                          SUB-ADVISOR
                    ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      INTER-        WFVT International Equity: seeks total return, with an emphasis on capital  appreciation,  over    Wells Fargo Funds
  NATIONAL EQUITY   the  long-term.  The Portfolio  pursues its  objective by investing  primarily in a diversified    Management, LLC
                    portfolio of equity  securities  of  companies  based in developed  non-U.S.  countries  and in
                    emerging markets of the world. Under normal market  conditions,  the Portfolio invests at least
                    80% of its total  assets in equity  securities  of companies  located or operating  outside the
                    U.S. and in a minimum of five  countries  exclusive of the U.S. The  Portfolio may invest up to
                    50% of its total assets in any one country and up to 25% of total  assets in emerging  markets.
                    Generally,  the  Portfolio  invests in issuers  with an average  market  capitalization  of $10
                    billion  or  more,  although  it may  invest  in  equity  securities  of  issuers  with  market
                    capitalization as low as $250 million.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    ------------------------------------------------------------------------------------------------ -----------------------
 SMALL CAP EQUITY   WFVT Small Cap  Growth:  seeks  long-term  capital  appreciation.  The  Portfolio  pursues  its    Wells Fargo Funds
                    objective by investing in a diversified  portfolio of common  stocks issued by companies  whose    Management, LLC
                    market  capitalization  falls with the range of the Russell 2000 Index.  The Portfolio  invests
                    in common stocks of domestic and foreign  companies that the Investment  Advisor  believes have
                    above-average  prospects  for capital  growth,  or that may be  involved  in new or  innovative
                    products,  services and processes.  Under normal market conditions, the Portfolio invests in an
                    actively managed, broadly diversified portfolio of small-cap  growth-oriented common stocks and
                    in at least 20 common stock issues spread across  multiple  industry  groups and sectors of the
                    economy.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    WFVT Growth:  seeks  long-term  capital  appreciation.  The Portfolio  pursues its objective by
                    investing  primarily in common  stocks and other  equity  securities  of companies  that have a
                    strong earnings growth trend that the Investment Advisor believes have above-average  prospects
 LARGE CAP EQUITY   for future  growth.  Under normal  market  conditions,  the  Portfolio  invests at least 65% of
                    total  assets in equity  securities,  including  common and  preferred  stocks  and  securities    Wells Fargo Funds
                    convertible  into common stocks.  The investment  strategy is focused on larger  capitalization     Management, LLC
                    stocks that fall within, but towards the higher end of, the range of the Russell 1000 Index.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    WFVT Large Company Growth:  seeks long-term  capital  appreciation.  The Portfolio  pursues its
                    objective by investing  primarily in common stocks of large,  high-quality  domestic  companies
                    that the Investment  Advisor believes have superior growth  potential.  The Investment  Advisor
 LARGE CAP EQUITY   looks for companies  whose growth  potential is generally  unrecognized  or misperceived by the    Wells Fargo Funds
                    market.  The  Portfolio  may invest,  under  normal  market  conditions,  at least 80% of total     Management, LLC
                    assets in securities with market  capitalizations of $3 billion or more, and up to 20% of total
                    assets in securities of foreign companies..
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    ------------------------------------------------------------------------------------------------ -----------------------
 LARGE CAP EQUITY   WFVT Equity Value:  seeks long-term  capital  appreciation and  above-average  dividend income.    Wells Fargo Funds
                    The  Portfolio  pursues its  objective by  investing  primarily  in equity  securities  of U.S.    Management, LLC
                    companies  with strong  return  potential  based on current  market  valuations.  Under  normal
                    circumstances,  the Portfolio  invests at least 80% of its assets in equity securities with the
                    same  characteristics  as common stocks, and in preferred stocks,  warrants,  and securities of
                    foreign companies through ADRs and similar investments.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
  EQUITY INCOME     WFVT Equity Income:  seeks long-term capital  appreciation and  above-average  dividend income.    Wells Fargo Funds
                    The  Portfolio  pursues its  objective  primarily by  investing in the common  stocks of large,    Management, LLC
                    domestic companies with  above-average  return potential based on current market valuations and
                    above-average  dividend income. Under normal market conditions,  the Portfolio invests at least
                    80% of its total assets in income producing  equity  securities and in issues of companies with
                    market capitalizations of $3 billion or more.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
ASSET ALLOCATION    WFVT Asset  Allocation:  seeks  long-term total return,  consistent  with reasonable  risk. The
                    Portfolio  pursues its objective by allocating and  reallocating its assets among common stocks
                    and U.S.  Treasury Bonds.  The Investment  Advisor manages the allocation of investments in the
                    Portfolio  assuming a  "neutral"  target  allocation  of 60%  stocks  and 40% bonds.  The stock     Wells Capital
                    portion of the  Portfolio is invested to replicate the  weightings  of each company  comprising        Management
                    the S&P 500 Index.  The bond  portion of the  Portfolio  is  invested to  replicate  the Lehman       Incorporated
                    Brothers 20+ Year Treasury Index.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------




- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      STYLE/                                        INVESTMENT OBJECTIVES/POLICIES                                         PORTFOLIO
       TYPE                                                                                                                 ADVISOR/
                                                                                                                          SUB-ADVISOR
                    ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
       BOND         WFVT Total Return Bond (f/k/a WFVT  Corporate  Bond):  seeks total return  consisting of income    Wells Fargo Funds
                    and capital  appreciation.  The  Portfolio  pursues its objective by investing  principally  in    Management, LLC
                    investment-grade debt securities,  which include U.S. Government obligations,  corporate bonds,
                    asset-backed  securities  and  money  market  instruments.  Under  normal  circumstances,   the
                    Portfolio will invest at least 80% of its assets in bonds.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
  INTERNATIONAL     AST Strong  International  Equity: seeks long-term capital growth by investing in a diversified      Strong Capital
      EQUITY        portfolio  of  international  equity  securities  the issuers of which are  considered  to have    Management, Inc.
                    strong  earnings  momentum.  The  Portfolio  seeks to meet its  objective by  investing,  under
                    normal  market  conditions,  at least 80% of its total  assets in a  diversified  portfolio  of
                    equity  securities  of  companies  located or operating in  developed  non-U.S.  countries  and
                    emerging  markets  of the  world.  The  Sub-advisor  intends  to  focus  on  companies  with an
                    above-average   potential  for  long-term  growth  and  attractive  relative  valuations.   The
                    Sub-advisor selects companies based on five key factors: growth,  valuation,  management,  risk
                    and sentiment.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
  INTERNATIONAL     AST William Blair  International  Growth (f/k/a AST Janus  Overseas  Growth):  seeks  long-term
      EQUITY        growth of capital.  The  Portfolio  pursues its  objective  primarily  through  investments  in
                    equity  securities  of issuers  located  outside  the United  States.  The  Portfolio  normally
                    invests at least 80% of its total assets in securities of issuers from at least five  different
                    countries,  excluding the United States.  The Portfolio invests primarily in companies selected
                    for their growth  potential.  Securities are generally  selected  without regard to any defined    William Blair &
                    allocation among countries,  geographic regions or industry sectors, or other similar selection     Company, L.L.C.
                    procedure.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
  INTERNATIONAL     AST American Century  International  Growth:  seeks capital growth.  The Portfolio will seek to
      EQUITY        achieve its investment  objective by investing  primarily in equity securities of international
                    companies  that the  Sub-advisor  believes  will  increase  in value  over time.  Under  normal
                    conditions,  the  Portfolio  will  invest at least 65% of its  assets in equity  securities  of
                    issuers from at least three  countries  outside of the United States.  The  Sub-advisor  uses a
                    growth  investment  strategy it developed  that looks for  companies  with earnings and revenue
                    growth.  The  Sub-advisor  will  consider  a  number  of other  factors  in  making  investment      American Century
                    selections,  including the prospects for relative  economic  growth among countries or regions,        Investment
                    economic and political  conditions,  expected inflation rates,  currency exchange  fluctuations     Management, Inc.
                    and tax considerations.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    AST DeAM  International  Equity:  seeks capital growth.  The Portfolio pursues its objective by
                    investing  at least 80% of the value of its assets in the equity  securities  of  companies  in
                    developed  non-U.S.  countries that are represented in the MSCI EAFE(R)Index. The target of this
  INTERNATIONAL     Portfolio  is to track the  performance  of the MSCI  EAFE(R)Index  within  4% with a  standard      Deutsche Asset
      EQUITY        deviation  expected of +/- 4%. The  Sub-advisor  considers  a number of factors in  determining     Management, Inc.
                    whether to invest in a stock,  including  earnings growth rate,  analysts'  estimates of future
                    earnings and industry-relative price multiples.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    AST MFS Global Equity:  seeks capital growth.  Under normal circumstances the Portfolio invests
                    at least 80% of its assets in equity securities of U.S. and foreign issuers  (including issuers      Massachusetts
  GLOBAL EQUITY     in developing  countries).  The Portfolio  generally seeks to purchase  securities of companies    Financial Services
                    with relatively large market capitalizations relative to the market in which they are traded.           Company
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
 SMALL CAP GROWTH   AST PBHG  Small-Cap  Growth:  seeks  capital  growth.  The  Portfolio  pursues its objective by
                    primarily  investing  at  least  80% of the  value  of its  assets  in  the  common  stocks  of
                    small-sized  companies,  whose market  capitalizations are similar to market capitalizations of
                    the  companies  in the  Russell  2000(R)Index at the time of the  Portfolio's  investment.  The     Pilgrim Baxter &
                    Sub-advisor  expects to focus primarily on those  securities  whose market  capitalizations  or     Associates, Ltd.
                    annual revenues are less than $1billion at the time of purchase.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------



- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      STYLE/                                        INVESTMENT OBJECTIVES/POLICIES                                         PORTFOLIO
       TYPE                                                                                                                 ADVISOR/
                                                                                                                          SUB-ADVISOR
                    ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
 SMALL CAP GROWTH   AST DeAM  Small-Cap  Growth:  seeks maximum  growth of  investors'  capital from a portfolio of      Deutsche Asset
                    growth  stocks of  smaller  companies.  The  Portfolio  pursues  its  objective,  under  normal    Management, Inc.
                    circumstances,  by  primarily  investing  at  least  80%  of its  total  assets  in the  equity
                    securities  of  small-sized   companies  included  in  the  Russell  2000  Growth(R)Index.  The
                    Sub-advisor  employs  an  investment  strategy  designed  to  maintain  a  portfolio  of equity
                    securities  which  approximates  the market risk of those  stocks  included in the Russell 2000
                    Growth(R)Index, but which attempts to outperform the Russell 2000 Growth(R)Index.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    AST Federated  Aggressive  Growth:  seeks capital growth.  The Portfolio pursues its investment
                    objective by investing in the stocks of small  companies  that are traded on national  security   Federated Investment
    SMALL CAP       exchanges,  NASDAQ stock  exchange and the  over-the-counter-market.  Small  companies  will be   Counseling/Federated
      GROWTH        defined as  companies  with market  capitalizations  similar to  companies  in the Russell 2000    Global Investment
                    Index or the Standard & Poor's  Small Cap 600 Index.  Up to 25% of the  Portfolio's  net assets     Management Corp.
                    may be invested in foreign securities, which are typically denominated in foreign currencies.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    ------------------------------------------------------------------------------------------------ -----------------------
 SMALL CAP VALUE    AST Gabelli Small-Cap Value:  seeks to provide long-term capital growth by investing  primarily
                    in  small-capitalization  stocks  that  appear to be  undervalued.  The  Portfolio  will have a
                    non-fundamental policy to invest, under normal circumstances,  at least 80% of the value of its
                    assets in small capitalization  companies.  The 80% investment  requirement applies at the time
                    the  Portfolio  invests  its assets.  The  Portfolio  generally  defines  small  capitalization
                    companies as those with a capitalization  of $1.5 billion or less.  Reflecting a value approach
                    to  investing,  the Portfolio  will seek the stocks of companies  whose current stock prices do         GAMCO
                    not appear to adequately reflect their underlying value as measured by assets,  earnings,  cash     Investors, Inc.
                    flow or business franchises.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
 SMALL CAP VALUE    AST DeAM Small-Cap Value:  seeks maximum growth of investors'  capital.  The Portfolio  pursues      Deutsche Asset
                    its  objective,  under normal  market  conditions,  by primarily  investing at least 80% of its     Management, Inc.
                    total assets in the equity  securities of small-sized  companies  included in the Russell 2000(R)
                    Value Index. The Sub-advisor  employs an investment  strategy  designed to maintain a portfolio
                    of equity  securities  which  approximates  the market  risk of those  stocks  included  in the
                    Russell 2000(R)Value Index, but which attempts to outperform the Russell 2000(R)Value Index.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
  MID-CAP GROWTH    AST Goldman Sachs Mid-Cap  Growth (f/k/a AST Janus Mid-Cap  Growth):  seeks  long-term  capital   Goldman Sachs Asset
                    growth.  The  Portfolio  pursues its  investment  objective,  by investing  primarily in equity        Management
                    securities selected for their growth potential,  and normally invests at least 80% of the value
                    of its assets in medium capitalization  companies. For purposes of the Portfolio,  medium-sized
                    companies  are those whose market  capitalizations  (measured at the time of  investment)  fall
                    within the range of  companies  in the  Standard & Poor's  MidCap  400 Index.  The  Sub-advisor
                    seeks  to  identify  individual  companies  with  earnings  growth  potential  that  may not be
                    recognized by the market at large.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------



- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      STYLE/                                        INVESTMENT OBJECTIVES/POLICIES                                         PORTFOLIO
       TYPE                                                                                                                 ADVISOR/
                                                                                                                          SUB-ADVISOR
                    ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
  MID-CAP GROWTH    AST Neuberger  Berman Mid-Cap  Growth:  seeks capital growth.  Under normal market  conditions,     Neuberger Berman
                    the Portfolio  primarily invests at least 80% of its net assets in the common stocks of mid-cap     Management Inc.
                    companies.  For purposes of the Portfolio,  companies with equity market  capitalizations  that
                    fall within the range of the Russell Midcap(R)Index,  at the time of investment,  are considered
                    mid-cap  companies.  Some of the  Portfolio's  assets  may be  invested  in the  securities  of
                    large-cap companies as well as in small-cap  companies.  The Sub-advisor looks for fast-growing
                    companies that are in new or rapidly evolving industries.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
   MID-CAP VALUE    AST Neuberger Berman Mid-Cap Value: seeks capital growth.  Under normal market conditions,  the     Neuberger Berman
                    Portfolio  primarily  invests at least 80% of its net  assets in the  common  stocks of mid-cap     Management Inc.
                    companies.  For purposes of the Portfolio,  companies with equity market  capitalizations  that
                    fall within the range of the Russell  Midcap(R)Index at the time of investment  are  considered
                    mid-cap  companies.  Some of the  Portfolio's  assets  may be  invested  in the  securities  of
                    large-cap  companies as well as in small-cap  companies.  Under the Portfolio's  value-oriented
                    investment  approach,  the Sub-advisor looks for well-managed  companies whose stock prices are
                    undervalued and that may rise in price before other investors realize their worth.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      ALL-CAP       AST Alger All-Cap Growth:  seeks long-term  capital growth.  The Portfolio invests primarily in        Fred Alger
      GROWTH        equity securities,  such as common or preferred stocks, that are listed on U.S. exchanges or in     Management, Inc.
                    the  over-the-counter  market.  The Portfolio may invest in the equity  securities of companies
                    of all sizes,  and may emphasize  either  larger or smaller  companies at a given time based on
                    the Sub-advisor's assessment of particular companies and market conditions.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    AST Gabelli  All-Cap  Value:  seeks  capital  growth.  The  Portfolio  pursues its objective by
                    investing primarily in readily marketable equity securities including common stocks,  preferred
                    stocks and  securities  that may be converted at a later time into common stock.  The Portfolio
      ALL-CAP       may invest in the  securities  of companies of all sizes,  and may  emphasize  either larger or
       VALUE        smaller  companies  at a  given  time  based  on the  Sub-advisor's  assessment  of  particular  GAMCO Investors, Inc.
                    companies and market  conditions.  The Portfolio  focuses on companies that appear  underpriced
                    relative  to their  private  market  value  ("PMV").  PMV is the  value  that  the  Portfolio's
                    Sub-advisor believes informed investors would be willing to pay for a company.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    AST T. Rowe Price Natural  Resources:  seeks  long-term  capital growth  primarily  through the
                    common stocks of companies  that own or develop  natural  resources  (such as energy  products,
                    precious  metals and forest  products)  and other basic  commodities.  The  Portfolio  normally
                    invests  primarily (at least 80% of its total assets) in the common stocks of natural  resource
      SECTOR        companies whose earnings and tangible  assets could benefit from  accelerating  inflation.  The      T. Rowe Price
                    Portfolio looks for companies that have the ability to expand production,  to maintain superior     Associates, Inc.
                    exploration  programs  and  production   facilities,   and  the  potential  to  accumulate  new
                    resources.  At least 50% of Portfolio assets will be invested in U.S. securities,  up to 50% of
                    total assets also may be invested in foreign securities.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    AST Alliance  Growth:  seeks long-term  capital growth.  The Portfolio  invests at least 80% of
                    its total assets in the equity  securities of a limited  number of large,  carefully  selected,
                    high-quality  U.S.  companies  that are judged  likely to  achieve  superior  earnings  growth.
 LARGE CAP GROWTH   Normally,  about 40-60  companies will be  represented in the Portfolio,  with the 25 companies     Alliance Capital
                    most  highly  regarded  by  the  Sub-advisor  usually  constituting  approximately  70%  of the     Management, L.P.
                    Portfolio's  net assets.  An emphasis is placed on identifying  companies  whose  substantially
                    above average prospective earnings growth is not fully reflected in current market valuations.
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- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
 LARGE CAP GROWTH   AST MFS  Growth:  seeks  long-term  capital  growth  and future  income.  Under  normal  market
                    conditions,  the  Portfolio  invests  at least 80% of its total  assets  in common  stocks  and
                    related securities,  such as preferred stocks,  convertible securities and depositary receipts,
                    of companies that the  Sub-advisor  believes offer better than average  prospects for long-term      Massachusetts
                    growth.  The Sub-advisor seeks to purchase  securities of companies that it considers  well-run    Financial Services
                    and  poised  for  growth.  The  Portfolio  may  invest up to 35% of its net  assets in  foreign         Company
                    securities.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------



- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      STYLE/                                        INVESTMENT OBJECTIVES/POLICIES                                         PORTFOLIO
       TYPE                                                                                                                 ADVISOR/
                                                                                                                          SUB-ADVISOR
                    ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
 LARGE CAP GROWTH   AST Marsico  Capital  Growth:  seeks capital  growth.  Income  realization is not an investment     Marsico Capital
                    objective  and  any  income  realized  on  the  Portfolio's  investments,  therefore,  will  be     Management, LLC
                    incidental to the Portfolio's  objective.  The Portfolio will pursue its objective by investing
                    primarily in common stocks of larger,  more  established  companies.  In selecting  investments
                    for the Portfolio,  the Sub-advisor uses an approach that combines "top down" economic analysis
                    with "bottom up" stock selection.  The "top down" approach identifies  sectors,  industries and
                    companies that should benefit from the trends the  Sub-advisor  has observed.  The  Sub-advisor
                    then looks for individual  companies with earnings growth  potential that may not be recognized
                    by the market at large, a "bottom up" stock selection.
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- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    AST Goldman Sachs Concentrated  Growth (f/k/a AST JanCap Growth):  seeks growth of capital in a
                    manner  consistent  with  the  preservation  of  capital.   Realization  of  income  is  not  a
                    significant  investment  consideration and any income realized on the Portfolio's  investments,
                    therefore,  will be  incidental to the  Portfolio's  objective.  The Portfolio  will pursue its
 LARGE CAP GROWTH   objective  by investing  primarily  in equity  securities  of  companies  that the  Sub-advisor   Goldman Sachs Asset
                    believes have  potential to achieve  capital  appreciation  over the  long-term.  The Portfolio        Management
                    seeks to achieve  its  investment  objective  by  investing,  under  normal  circumstances,  in
                    approximately  30 - 45 companies  that are  considered by the  Sub-advisor to be positioned for
                    long-term growth.
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- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    AST DeAM  Large-Cap  Growth:  seeks  maximum  growth of capital by  investing  primarily in the
                    growth stocks of larger  companies.  The Portfolio  pursues its objective,  under normal market
                    conditions,  by primarily  investing at least 80% of its total assets in the equity  securities
 LARGE CAP GROWTH   of large-sized  companies  included in the Russell 1000(R)Growth Index. The Sub-advisor  employs      Deutsche Asset
                    an  investment   strategy   designed  to  maintain  a  portfolio  of  equity  securities  which     Management, Inc.
                    approximates  the market risk of those stocks  included in the Russell 1000(R)Growth Index,  but
                    which attempts to outperform the Russell 1000(R)Growth Index through active stock selection.
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- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    AST DeAM Large-Cap Value (f/k/a AST Janus Strategic Value):  seeks maximum growth of capital by
                    investing  primarily  in the value  stocks of  larger  companies.  The  Portfolio  pursues  its
                    objective,  under normal market conditions, by primarily investing at least 80% of the value of
                    its assets in the equity  securities  of  large-sized  companies  included in the Russell 1000(R)    Deutsche Asset
  LARGE CAP VALUE   Value Index. The Sub-advisor  employs an investment  strategy  designed to maintain a portfolio     Management, Inc.
                    of equity  securities  which  approximates  the market  risk of those  stocks  included  in the
                    Russell  1000(R)Value Index,  but which  attempts to  outperform  the Russell  1000(R)Value Index
                    through active stock selection.
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- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
    LARGE CAP       AST Alliance/Bernstein  Growth + Value: seeks capital growth by investing  approximately 50% of     Alliance Capital
      BLEND         its assets in growth  stocks of large  companies and  approximately  50% of its assets in value     Management, L.P.
                    stocks of large  companies.  The Portfolio will invest primarily in common stocks of large U.S.
                    companies included in the Russell 1000(R)Index (the "Russell 1000(R)"). The Russell 1000(R)is a
                    market  capitalization-weighted  index that measures the  performance of the 1,000 largest U.S.
                    companies.  Normally,  about 60-85  companies will be represented in the Portfolio,  with 25-35
                    companies  primarily from the Russell 1000(R)Growth Index constituting  approximately 50% of the
                    Portfolio's  net assets and 35-50  companies  primarily  from the  Russell  1000(R)Value  Index
                    constituting  the  remainder  of  the  Portfolio's  net  assets.   There  will  be  a  periodic
                    rebalancing  of each  segment's  assets  to take  account  of market  fluctuations  in order to
                    maintain the approximately equal allocation.
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- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
  LARGE CAP VALUE   AST Sanford  Bernstein Core Value:  seeks  long-term  capital growth by investing  primarily in   Sanford C. Bernstein
                    common stocks.  The  Sub-advisor  expects that the majority of the  Portfolio's  assets will be        & Co., LLC
                    invested in the common stocks of large  companies  that appear to be  undervalued.  Among other
                    things, the Portfolio seeks to identify compelling buying opportunities  created when companies
                    are undervalued on the basis of investor  reactions to near-term problems or circumstances even
                    though their long-term  prospects  remain sound. The Sub-advisor  seeks to identify  individual
                    companies with earnings growth potential that may not be recognized by the market at large.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------



- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      STYLE/                                        INVESTMENT OBJECTIVES/POLICIES                                         PORTFOLIO
       TYPE                                                                                                                 ADVISOR/
                                                                                                                          SUB-ADVISOR
                    ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
   REAL ESTATE      AST Cohen & Steers Realty:  seeks to maximize  total return  through  investment in real estate      Cohen & Steers
                    securities.  The  Portfolio  pursues  its  investment  objective  by  investing,  under  normal
                    circumstances,  at least 80% of its net assets in  securities  of real  estate  issuers.  Under
                    normal  circumstances,  the Portfolio will invest substantially all of its assets in the equity
      (REIT)        securities of real estate companies,  i.e., a company that derives at least 50% of its revenues
                    from the ownership,  construction,  financing, management or sale of real estate or that has at   Capital Management,
                    least  50% of its  assets in real  estate.  Real  estate  companies  may  include  real  estate           Inc.
                    investment trusts or REITs.
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- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    AST Sanford Bernstein Managed Index 500: will invest, under normal circumstances,  at least 80%
                    of its net assets in  securities  included in the Standard & Poor's 500  Composite  Stock Price
                    Index  (the  "S&P(R)500 ").  The  Portfolio  seeks  to  outperform  the S&P 500  through  stock
                    selection  resulting  in  different  weightings  of common  stocks  relative to the index.  The
                    Portfolio will invest  primarily in the common stocks of companies  included in the S&P 500. In
                    seeking  to  outperform  the S&P  500,  the  Sub-advisor  starts  with a  portfolio  of  stocks
  MANAGED INDEX     representative  of the holdings of the index.  It then uses a set of  fundamental  quantitative   Sanford C. Bernstein
                    criteria  that are designed to indicate  whether a particular  stock will  predictably  perform        & Co., LLC
                    better or worse than the S&P 500. Based on these criteria,  the Sub-advisor  determines whether
                    the  Portfolio  should  over-weight,  under-weight  or hold a  neutral  position  in the  stock
                    relative  to the  proportion  of the S&P 500  that  the  stock  represents.  In  addition,  the
                    Sub-advisor  also  may  determine  that  based on the  quantitative  criteria,  certain  equity
                    securities that are not included in the S&P 500 should be held by the Portfolio.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    AST American  Century Income & Growth:  seeks capital growth with current income as a secondary
                    objective.  The Portfolio  invests  primarily in common stocks that offer potential for capital
      GROWTH        growth,  and may,  consistent  with its  investment  objective,  invest  in stocks  that  offer     American Century
       AND          potential for current income.  The  Sub-advisor  utilizes a quantitative  management  technique        Investment
      INCOME        with a goal of building an equity  portfolio  that  provides  better  returns  than the S&P 500     Management, Inc.
                    Index without taking on significant  additional risk and while  attempting to create a dividend
                    yield that will be greater than the S&P 500 Index.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    AST Alliance Growth and Income:  seeks long-term  growth of capital and income while attempting
                    to avoid excessive  fluctuations in market value. The Portfolio  normally will invest in common
      GROWTH        stocks  (and  securities   convertible  into  common  stocks).  The  Sub-advisor  will  take  a
       AND          value-oriented  approach,  in that it will  try to keep  the  Portfolio's  assets  invested  in     Alliance Capital
      INCOME        securities that are selling at reasonable  valuations in relation to their fundamental business     Management, L.P.
                    prospects.  The  stocks  that the  Portfolio  will  normally  invest in are  those of  seasoned
                    companies.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    AST MFS Growth with  Income:  seeks long term growth of capital  with a secondary  objective to
                    seek  reasonable  current  income.  Under normal market  conditions,  the Portfolio  invests at
                    least 65% of its net assets in common stocks and related securities,  such as preferred stocks,
      GROWTH        convertible  securities  and  depositary  receipts.  The stocks in which the Portfolio  invests      Massachusetts
       AND          generally  will pay  dividends.  While the Portfolio  may invest in companies of any size,  the    Financial Services
      INCOME        Portfolio  generally  focuses  on  companies  with  larger  market   capitalizations  that  the         Company
                    Sub-advisor  believes have  sustainable  growth  prospects and attractive  valuations  based on
                    current and  expected  earnings  or cash flow.  The  Portfolio  may invest up to 20% of its net
                    assets in foreign securities.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
  EQUITY INCOME     AST INVESCO Capital Income (f/k/a AST INVESCO Equity Income):  seeks capital growth and current   INVESCO Funds Group,
                    income  while  following  sound  investment  practices.  The  Portfolio  seeks to  achieve  its           Inc.
                    objective by investing in  securities  that are expected to produce  relatively  high levels of
                    income and consistent,  stable returns.  The Portfolio normally will invest at least 65% of its
                    assets in  dividend-paying  common and preferred stocks of domestic and foreign issuers.  Up to
                    30% of the  Portfolio's  assets may be  invested in equity  securities  that do not pay regular
                    dividends.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------



- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      STYLE/                                        INVESTMENT OBJECTIVES/POLICIES                                         PORTFOLIO
       TYPE                                                                                                                 ADVISOR/
                                                                                                                          SUB-ADVISOR
                    ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
     BALANCED       AST DeAM Global  Allocation:  seeks a high level of total  return by  investing  primarily in a      Deutsche Asset
                    diversified  portfolio  of  mutual  funds.  The  Portfolio  seeks  to  achieve  its  investment     Management, Inc.
                    objective  by  investing  in  several  other  AST  Portfolios  ("Underlying  Portfolios").  The
                    Portfolio intends its strategy of investing in combinations of Underlying  Portfolios to result
                    in  investment  diversification  that an  investor  could  otherwise  achieve  only by  holding
                    numerous  investments.  The  Portfolio  is  expected  to be  invested  in  at  least  six  such
                    Underlying  Portfolios at any time. It is expected that the  investment  objectives of such AST
                    Portfolios will be diversified.
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- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    AST  American  Century  Strategic  Balanced:  seeks  capital  growth and  current  income.  The
                    Sub-advisor  intends  to  maintain  approximately  60%  of the  Portfolio's  assets  in  equity
                    securities and the remainder in bonds and other fixed income  securities.  Both the Portfolio's     American Century
     BALANCED       equity and fixed  income  investments  will  fluctuate  in value.  The equity  securities  will        Investment
                    fluctuate  depending on the  performance of the companies that issued them,  general market and     Management, Inc.
                    economic  conditions,  and investor  confidence.  The fixed income investments will be affected
                    primarily by rising or falling interest rates and the credit quality of the issuers.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
ASSET ALLOCATION    AST T. Rowe Price Asset Allocation:  seeks a high level of total return by investing  primarily      T. Rowe Price
                    in a  diversified  portfolio  of fixed income and equity  securities.  The  Portfolio  normally     Associates, Inc.
                    invests  approximately  60% of its total  assets in equity  securities  and 40% in fixed income
                    securities.  The Sub-advisor  concentrates common stock investments in larger, more established
                    companies,  but the  Portfolio may include small and  medium-sized  companies  with good growth
                    prospects.  The fixed income portion of the Portfolio will be allocated among  investment grade
                    securities, high yield or "junk" bonds, foreign high quality debt securities and cash reserves.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
   GLOBAL BOND      AST T. Rowe Price Global  Bond:  seeks to provide  high  current  income and capital  growth by      T. Rowe Price
                    investing  in  high-quality  foreign and U.S.  dollar-denominated  bonds.  The  Portfolio  will   International, Inc.
                    invest at least 80% of its total  assets in all types of high  quality  bonds  including  those
                    issued  or  guaranteed  by U.S.  or  foreign  governments  or  their  agencies  and by  foreign
                    authorities,  provinces and  municipalities  as well as investment  grade  corporate  bonds and
                    mortgage and  asset-backed  securities of U.S. and foreign  issuers.  The  Portfolio  generally
                    invests in countries where the combination of fixed-income  returns and currency exchange rates
                    appears attractive,  or, if the currency trend is unfavorable,  where the Sub-advisor  believes
                    that the currency risk can be minimized  through  hedging.  The Portfolio may also invest up to
                    20% of its assets in the aggregate in below  investment-grade,  high-risk bonds ("junk bonds").
                    In addition,  the  Portfolio may invest up to 30% of its assets in  mortgage-backed  (including
                    derivatives,  such as collateralized mortgage obligations and stripped mortgage securities) and
                    asset-backed securities.
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- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
 HIGH YIELD BOND    AST Federated  High Yield:  seeks high current  income by investing  primarily in a diversified   Federated Investment
                    portfolio of fixed income  securities.  The Portfolio will invest at least 80% of its assets in
                    fixed  income  securities  rated BBB and below.  These  fixed  income  securities  may  include
                    preferred  stocks,   convertible  securities,   bonds,   debentures,   notes,  equipment  lease
                    certificates  and equipment trust  certificates.  A fund that invests  primarily in lower-rated
                    fixed  income  securities  will be subject to greater risk and share price  fluctuation  than a
                    typical  fixed income fund,  and may be subject to an amount of risk that is  comparable  to or        Counseling
                    greater than many equity funds.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------



- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      STYLE/                                        INVESTMENT OBJECTIVES/POLICIES                                         PORTFOLIO
       TYPE                                                                                                                 ADVISOR/
                                                                                                                          SUB-ADVISOR
                    ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
       BOND         AST Lord Abbett  Bond-Debenture:  seeks high  current  income and the  opportunity  for capital  Lord, Abbett & Co. LLC
                    appreciation  to produce a high total  return.  To pursue its  objective,  the  Portfolio  will
                    invest,  under  normal  circumstances,  at least 80% of the value of its assets in fixed income
                    securities and normally  invests  primarily in high yield and investment grade debt securities,
                    securities  convertible  in common stock and  preferred  stocks.  The  Portfolio  may find good
                    value in high yield  securities,  sometimes  called  "lower-rated  bonds" or "junk  bonds," and
                    frequently  may have more than half of its assets  invested in those  securities.  At least 20%
                    of the  Portfolio's  assets  must be  invested  in any  combination  of  investment  grade debt
                    securities,  U.S.  Government  securities  and cash  equivalents.  The  Portfolio may also make
                    significant  investments  in  mortgage-backed  securities.  Although the  Portfolio  expects to
                    maintain  a  weighted  average  maturity  in the  range of five to twelve  years,  there are no
                    restrictions  on the overall  Portfolio or on individual  securities.  The Portfolio may invest
                    up to 20% of its net assets in equity securities.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    AST DeAM Bond:  seeks a high level of income,  consistent  with the  preservation  of  capital.
                    Under  normal  circumstances,  the  Portfolio  invests  at least  80% of its  total  assets  in
                    intermediate-term  U.S.  Treasury,   corporate,   mortgage-backed  and  asset-backed,   taxable
       BOND         municipal and tax-exempt  municipal bonds. The Portfolio  invests primarily in investment grade      Deutsche Asset
                    fixed  income  securities  rated  within  the  top  three  rating  categories  of a  nationally     Management, Inc.
                    recognized  rating  organization.  Fixed  income  securities  may be issued by U.S. and foreign
                    corporations or entities including banks and various government entities.
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- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
       BOND         AST PIMCO Total Return Bond:  seeks to maximize total return  consistent  with  preservation of    Pacific Investment
                    capital  and  prudent  investment  management.  The  Portfolio  will  invest  in a  diversified
                    portfolio of fixed-income  securities of varying maturities.  The average portfolio duration of
                    the  Portfolio  generally  will  vary  within a three-  to  six-year  time  frame  based on the
                    Sub-advisor's forecast for interest rates.                                                       Management Company LLC
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
       BOND         AST PIMCO Limited  Maturity Bond: seeks to maximize total return  consistent with  preservation
                    of capital  and prudent  investment  management.  The  Portfolio  will invest in a  diversified
                    portfolio of fixed-income  securities of varying maturities.  The average portfolio duration of
                    the  Portfolio  generally  will  vary  within  a one- to  three-year  time  frame  based on the    Pacific Investment
                    Sub-advisor's forecast for interest rates.                                                       Management Company LLC
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
   MONEY MARKET     AST Money  Market:  seeks high  current  income and  maintain  high  levels of  liquidity.  The      Wells Capital
                    Portfolio  attempts to  accomplish  its  objective by  maintaining  a  dollar-weighted  average     Management, Inc.
                    maturity  of not  more  than 90 days  and by  investing  in  securities  which  have  effective
                    maturities of not more than 397 days.
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- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
 EMERGING MARKETS   Gartmore Variable Investment Trust - Developing Markets:  seeks long-term capital appreciation,
                    under  normal  conditions  by investing at least 80% of its total assets in stocks of companies  Gartmore Global Asset
                    of any size  based  in the  world's  developing  economies.  Under  normal  market  conditions,        Management
                    investments  are  maintained  in at least  six  countries  at all times and no more than 35% of  Trust/Gartmore Global
                    total assets in any single one of them.                                                                 Partners
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
  MID-CAP EQUITY    INVESCO Variable  Investment  Funds - Dynamics:  seek long-term  capital growth.  The Portfolio   INVESCO Funds Group,
                    invests at least 65% of its assets in common  stocks of mid-sized  companies.  INVESCO  defines           Inc.
                    mid-sized  companies as companies  that are included in the Russell  Midcap Growth Index at the
                    time of purchase,  or if not  included in that Index,  have market  capitalizations  of between
                    $2.5 billion and $15 billion at the time of purchase.  The core of the Portfolio's  investments
                    are in securities of established  companies that are leaders in attractive  growth markets with
                    a history of strong  returns.  The  remainder  of the  Portfolio is invested in  securities  of
                    companies  that show  accelerating  growth,  driven by product  cycles,  favorable  industry or
                    sector  conditions,  and other  factors  that  INVESCO  believes  will  lead to rapid  sales or
                    earnings growth.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------



- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      STYLE/                                        INVESTMENT OBJECTIVES/POLICIES                                         PORTFOLIO
       TYPE                                                                                                                 ADVISOR/
                                                                                                                          SUB-ADVISOR
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    ------------------------------------------------------------------------------------------------ -----------------------
      SECTOR        INVESCO Variable  Investment Funds - Technology:  seeks capital growth.  The Portfolio normally   INVESCO Funds Group,
                    invests  80% of its net assets in the  equity  securities  and  equity-related  instruments  of           Inc.
                    companies  engaged in  technology-related  industries.  These include,  but are not limited to,
                    various applied technologies, hardware, software, semiconductors,  telecommunications equipment
                    and services and service-related  companies in information  technology.  Many of these products
                    and services are subject to rapid obsolescence,  which may lower market value of the securities
                    of the  companies  in this  sector.  At any given time,  20% of the  Portfolio's  assets is not
                    required to be invested in the sector.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      SECTOR        INVESCO  Variable  Investment  Funds - Health  Sciences:  seeks capital  growth.  The Portfolio   INVESCO Funds Group,
                    normally  invests at least 80% of its net assets in the equity  securities  and  equity-related           Inc.
                    instruments of companies that develop,  produce or distribute  products or services  related to
                    health care. These companies  include,  but are not limited to, medical  equipment or supplies,
                    pharmaceuticals,  biotechnology and healthcare  providers and service  companies.  At any given
                    time, 20% of the Portfolio's assets is not required to be invested in the sector.
- ------------------- ------------------------------------------------------------------------------------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      SECTOR        INVESCO Variable  Investment Funds - Financial  Services:  seeks capital growth.  The Portfolio   INVESCO Funds Group,
                    normally  invests at least 80% of its net assets in the equity  securities  and  equity-related           Inc.
                    instruments of companies  involved in the financial  services sector.  These companies include,
                    but are not  limited  to,  banks  (regional  and  money-centers),  insurance  companies  (life,
                    property  and  casualty,  and  multiline),   investment  and  miscellaneous  industries  (asset
                    managers,  brokerage  firms,  and  government-sponsored  agencies)  and  suppliers to financial
                    services  companies.  At any given time,  20% of the  Portfolio's  assets is not required to be
                    invested in the sector.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      SECTOR        INVESCO  Variable  Investment  Funds -  Telecommunications:  seeks  capital  growth and current   INVESCO Funds Group,
                    income.  The  Portfolio  normally  invests 80% of its net assets in the equity  securities  and
                    equity-related  instruments  of  companies  engaged in the  design,  development,  manufacture,
                    distribution,  or sale of  communications  services  and  equipment,  and  companies  that  are
                    involved in supplying equipment or services to such companies.  The  telecommunications  sector
                    includes,   but  is  not  limited  to,  companies  that  offer  telephone  services,   wireless
                    communications,  satellite communications,  television and movie programming,  broadcasting and
                    Internet access. Many of these products and services are subject to rapid  obsolescence,  which           Inc.
                    may lower the market value of the  securities  of the  companies  in this sector.  At any given
                    time, 20% of the Portfolio's assets is not required to be invested in the sector.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
  INTERNATIONAL     Evergreen VA  International  Equity  (acquired  Evergreen VA Global  Leader):  seeks  long-term
      EQUITY        capital growth and,  secondarily,  modest  income.  The Portfolio  invests  primarily in equity
                    securities  issued by  established,  quality,  non-U.S.  companies  located in  countries  with
                    developed markets, but may purchase across all market  capitalizations.  The Portfolio normally   Evergreen Investment
                    invests at least 65% of its assets in  securities  of  companies  in at least  three  different   Management Company,
                    countries  (other than the U.S.),  but may invest  more than 25% of its assets in one  country.           LLC
                    The Portfolio also invests in emerging markets.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- -------------------
 SMALL CAP EQUITY   Evergreen VA Special Equity:  seeks capital  growth.  The Portfolio  normally  invests at least
                    80% of its assets in common  stocks of small  U.S.  companies  (i.e.,  companies  whose  market
                    capitalizations  fall within the range of the Russell  2000(R)Index,  at the time of  purchase).
                    The remaining 20% of the  Portfolio's  assets may be represented by cash or invested in various   Evergreen Investment
                    cash  equivalents.  The Portfolio's  manager selects stocks of companies which it believes have   Management Company,
                    the potential for accelerated growth in earnings and price.                                               LLC
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- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
  MID-CAP EQUITY    Evergreen VA Omega:  seeks long-term capital growth.  The Portfolio invests primarily in common
                    stocks and  securities  convertible  into  common  stocks of U.S.  companies  across all market
                    capitalizations.  The  Portfolio's  managers  employ  a  growth  style  of  equity  management.   Evergreen Investment
                    "Growth" stocks are stocks of companies that the Portfolio's  managers believe have anticipated   Management Company,
                    earnings ranging from steady to accelerated growth.                                                       LLC
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------



- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      STYLE/                                        INVESTMENT OBJECTIVES/POLICIES                                         PORTFOLIO
       TYPE                                                                                                                 ADVISOR/
                                                                                                                          SUB-ADVISOR
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
  INTERNATIONAL     ProFund  VP  Europe  30:  seeks  daily  investment  results,  before  fees and  expenses,  that   ProFund Advisors LLC
     EQUITY         correspond to the daily  performance of the ProFunds  Europe 30 Index.  The ProFunds  Europe 30
                    Index,  created by ProFund  Advisors,  is composed of 30 companies whose principal  offices are
                    located  in Europe  and whose  securities  are  traded on U.S.  exchanges  or on the  NASDAQ as
                    depositary  receipts or ordinary  shares.  The  component  companies in the ProFunds  Europe 30
                    Index are  determined  annually  based upon their U.S.  dollar-traded  volume.  Their  relative
                    weights are determined based on a modified market capitalization method.
                    ------------------------------------------------------------------------------------------------ -----------------------
                    ------------------------------------------------------------------------------------------------ -----------------------

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  INTERNATIONAL     ProFund VP Asia 30: seeks daily investment results,  before fees and expenses,  that correspond   ProFund Advisors LLC
      EQUITY        to the daily  performance  of the ProFunds Asia 30 Index.  The ProFunds Asia 30 Index,  created
                    by ProFund Advisors,  is composed of 30 of the companies whose principal offices are located in
                    the Asia/Pacific region,  excluding Japan, and whose securities are traded on U.S. exchanges or
                    on the NASDAQ as  depository  receipts or  ordinary  shares.  The  component  companies  in the
                    ProFunds Asia 30 Index are  determined  annually  based upon their U.S.  dollar-traded  volume.
                    Their relative weights are determined based on the modified market capitalization method.
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- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    ProFund VP Japan: seeks daily investment results,  before fees and expenses, that correspond to
                    the daily  performance  of the Nikkei 225 Stock  Average.  Since the  Japanese  markets are not
                    open when  ProFund VP Japan  values its  shares,  ProFund VP Japan  determines  its  success in
  INTERNATIONAL     meeting this  investment  objective by comparing its daily return on a given day with the daily   ProFund Advisors LLC
      EQUITY        performance of related  futures  contracts  traded in the United  States.  The Nikkei 225 Stock
                    Average is a price-weighted  index of 225 large,  actively traded Japanese stocks traded on the
                    Tokyo Stock Exchange.  The Index is computed and distributed by the Nihon Keizai Shimbun.
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- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      SECTOR        ProFund VP Banks: seeks daily investment results,  before fees and expenses, that correspond to   ProFund Advisors LLC
                    the daily  performance  of the Dow Jones U.S.  Banks  Sector  Index.  The Dow Jones U.S.  Banks
                    Index measures the  performance of the banking  industry of the U.S.  equity market.  Component
                    companies  include all  regional  and major U.S.  domiciled  international  banks,  savings and
                    loans, savings banks,  thrifts,  building  associations and societies.  Investment and merchant
                    banks are excluded.
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- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    ProFund VP Basic Materials:  seeks daily  investment  results,  before fees and expenses,  that
                    correspond to the daily  performance of the Dow Jones U.S. Basic  Materials  Sector Index.  The
                    Dow Jones U.S. Basic  Materials  Sector Index measures the  performance of the basic  materials
      SECTOR        economic sector of the U.S. equity market.  Component  companies are involved in the production   ProFund Advisors LLC
                    of aluminum,  commodity chemicals,  specialty chemicals,  forest products,  non-ferrous metals,
                    paper products, precious metals and steel.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    ProFund VP  Biotechnology:  seeks daily  investment  results,  before fees and  expenses,  that
                    correspond to the daily  performance of the Dow Jones U.S.  Biotechnology  Index. The Dow Jones
                    U.S.  Biotechnology  Index measures the performance of the  biotechnology  industry of the U.S.
      SECTOR        equity  market.  Component  companies  include  those engaged in genetic  research,  and/or the   ProFund Advisors LLC
                    marketing  and  development  of  recombinant  DNA  products.  Makers  of  artificial  blood and
                    contract biotechnology researchers are also included in the Index.
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- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      SECTOR        ProFund VP Consumer Cyclical:  seeks daily investment results,  before fees and expenses,  that   ProFund Advisors LLC
                    correspond to the daily  performance of the Dow Jones U.S.  Consumer Cyclical Sector Index. The
                    Dow Jones U.S.  Consumer  Cyclical  Sector  Index  measures  the  performance  of the  consumer
                    cyclical  economic  sector of the U.S. equity market.  Component  companies  include  airlines,
                    auto manufacturers,  auto parts, tires, casinos,  consumer  electronics,  recreational products
                    and services,  restaurants,  lodging, toys, home construction, home furnishings and appliances,
                    footwear, clothing and fabrics.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------



- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      STYLE/                                        INVESTMENT OBJECTIVES/POLICIES                                         PORTFOLIO
       TYPE                                                                                                                 ADVISOR/
                                                                                                                          SUB-ADVISOR
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      SECTOR        ProFund VP Consumer  Non-Cyclical:  seeks daily investment  results,  before fees and expenses,   ProFund Advisors LLC
                    that correspond to the daily  performance of the Dow Jones U.S.  Consumer  Non-Cyclical  Sector
                    Index. The Dow Jones U.S.  Consumer  Non-Cyclical  Sector Index measures the performance of the
                    consumer  non-cyclical  economic sector of the U.S. equity market.  Component companies include
                    beverage  companies,  consumer service  companies,  durable and non-durable  household  product
                    manufacturers, cosmetic companies, food products and agriculture and tobacco products.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      SECTOR        ProFund VP Energy:  seeks daily investment results,  before fees and expenses,  that correspond   ProFund Advisors LLC
                    to the daily  performance of the Dow Jones U.S. Energy Sector Index.  The Dow Jones U.S. Energy
                    Sector  Index  measures  the  performance  of the  energy  sector  of the U.S.  equity  market.
                    Component  companies include oil drilling  equipment and services,  coal, oil  companies-major,
                    oil companies-secondary,  pipelines, liquid, solid or gaseous fossil fuel producers and service
                    companies.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      SECTOR        ProFund  VP  Financial:  seeks  daily  investment  results,  before  fees  and  expenses,  that   ProFund Advisors LLC
                    correspond to the daily  performance  of the Dow Jones U.S.  Financial  Sector  Index.  The Dow
                    Jones U.S.  Financial Sector Index measures the performance of the financial  services economic
                    sector of the U.S.  equity market.  Component  companies  include  regional  banks,  major U.S.
                    domiciled  international banks, full line, life, and property and casualty insurance companies,
                    companies that invest,  directly or indirectly in real estate,  diversified financial companies
                    such  as  Fannie  Mae,  credit  card  insurers,  check  cashing  companies,  mortgage  lenders,
                    investment  advisers and securities  broker-dealers,  investment banks,  merchant banks, online
                    brokers, publicly traded stock exchanges.
- ------------------- ------------------------------------------------------------------------------------------------
                    ------------------------------------------------------------------------------------------------ -----------------------
      SECTOR        ProFund  VP  Healthcare:  seeks  daily  investment  results,  before  fees and  expenses,  that   ProFund Advisors LLC
                    correspond to the daily  performance of the Dow Jones U.S.  Healthcare  Sector Index.  The Down
                    Jones U.S.  Healthcare Sector Index measures the performance of the healthcare  economic sector
                    of the U.S. equity market.  Component  companies  include health care providers,  biotechnology
                    companies, medical supplies, advanced medical devices and pharmaceuticals.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      SECTOR        ProFund  VP  Industrial:  seeks  daily  investment  results,  before  fees and  expenses,  that   ProFund Advisors LLC
                    correspond to the daily  performance  of the Dow Jones U.S.  Industrial  Sector Index.  The Dow
                    Jones U.S.  Industrial Sector Index measures the performance of the industrial  economic sector
                    of  the  U.S.  equity  market.   Component   companies   include  building   materials,   heavy
                    construction,  factory  equipment,  heavy machinery,  industrial  services,  pollution control,
                    containers  and  packaging,   industrial  diversified,   air  freight,  marine  transportation,
                    railroads,  trucking,  land-transportation  equipment,  shipbuilding,  transportation services,
                    advanced industrial equipment, electric components and equipment, and aerospace.
- ------------------- ------------------------------------------------------------------------------------------------
                    ------------------------------------------------------------------------------------------------ -----------------------
      SECTOR        ProFund VP Internet:  seeks daily investment results, before fees and expenses, that correspond   ProFund Advisors LLC
                    to the daily  performance  of the Dow  Jones  U.S.  Internet  Index.  The Dow  Jones  Composite
                    Internet Index measures the  performance of stocks in the U.S. equity markets that generate the
                    majority  of their  revenues  from the  Internet.  The  Index is  composed  of two  sub-groups:
                    Internet  Commerce - companies that derive the majority of their revenues from providing  goods
                    and/or services through an open network,  such as a web site; and Internet Services - companies
                    that derive the majority of their revenues from  providing  access to the Internet or providing
                    services to people using the Internet.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      SECTOR        ProFund VP  Pharmaceuticals:  seeks daily investment  results,  before fees and expenses,  that   ProFund Advisors LLC
                    correspond to the daily  performance of the Dow Jones U.S.  Pharmaceuticals  Sector Index.  The
                    Dow Jones U.S.  Pharmaceuticals Index measures the performance of the pharmaceuticals  industry
                    of the U.S.  equity  market.  Component  companies  include  the  makers  of  prescription  and
                    over-the-counter  drugs, such as aspirin, cold remedies,  birth control pills, and vaccines, as
                    well as companies engaged in contract drug research.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------



- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      STYLE/                                        INVESTMENT OBJECTIVES/POLICIES                                         PORTFOLIO
       TYPE                                                                                                                 ADVISOR/
                                                                                                                          SUB-ADVISOR
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    ------------------------------------------------------------------------------------------------ -----------------------
      SECTOR        ProFund VP Precious Metals:  seeks daily  investment  results,  before fees and expenses,  that   ProFund Advisors LLC
                    correspond to the daily  performance  of the  Philadelphia  Stock Exchange Gold & Silver Sector
                    Index.  The  Philadelphia  Stock Exchange Gold and Silver Sector Index measures the performance
                    of the gold and  silver  mining  industry  of the global  equity  market.  Component  companies
                    include  companies  involved in the mining and production of gold,  silver,  and other precious
                    metals,  precious  stones and pearls.  The Index does not include  producers  of  commemorative
                    medals and coins that are made of these metals.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    ------------------------------------------------------------------------------------------------ -----------------------
                    ProFund VP Real  Estate:  seeks  daily  investment  results,  before  fees and  expenses,  that
                    correspond to the daily  performance  of the Dow Jones U.S.  Real Estate  Index.  The Dow Jones
                    U.S. Real Estate Index measures the  performance of the real estate industry of the U.S. equity
                    market.   Component  companies  include  those  that  invest  directly  or  indirectly  through
      SECTOR        development,   management  or  ownership  of  shopping  malls,  apartment  buildings,   housing   ProFund Advisors LLC
                    developments  and, real estate  investment  trusts ("REITs") that invest in apartments,  office
                    and  retail  properties.  REITs are  passive  investment  vehicles  that  invest  primarily  in
                    income-producing real estate or real estate related loans or interests.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      SECTOR        ProFund VP  Semiconductor:  seeks daily  investment  results,  before fees and  expenses,  that   ProFund Advisors LLC
                    correspond to the daily  performance of the Dow Jones U.S.  Semiconductor  Index. The Dow Jones
                    U.S.  Semiconductor  Index measures the performance of the  semiconductor  industry of the U.S.
                    equity market.  Component  companies are engaged in the production of semiconductors  and other
                    integrated chips, as well as other related products such as circuit boards and motherboards.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    ------------------------------------------------------------------------------------------------ -----------------------
      SECTOR        ProFund  VP  Technology:  seeks  daily  investment  results,  before  fees and  expenses,  that   ProFund Advisors LLC
                    correspond to the daily  performance  of the Dow Jones U.S.  Technology  Sector Index.  The Dow
                    Jones U.S.  Technology  Sector Index measures the  performance of the technology  sector of the
                    U.S.  equity  market.  Component  companies  include  those  involved in  computers  and office
                    equipment,  software,   communications  technology,   semiconductors,   diversified  technology
                    services and internet services.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      SECTOR        ProFund VP Telecommunications:  seeks daily investment results,  before fees and expenses, that   ProFund Advisors LLC
                    correspond to the daily performance of the Dow Jones U.S.  Telecommunications Sector Index. The
                    Dow  Jones  U.S.   Telecommunications   Sector   Index   measures   the   performance   of  the
                    telecommunications  economic  sector of the U.S.  equity market.  Component  companies  include
                    fixed line communications and wireless communications companies.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      SECTOR        ProFund  VP  Utilities:  seeks  daily  investment  results,  before  fees  and  expenses,  that   ProFund Advisors LLC
                    correspond to the daily  performance  of the Dow Jones U.S.  Utilities  Sector  Index.  The Dow
                    Jones U.S.  Utilities Sector Index measures the performance of the utilities economic sector of
                    the U.S. equity market.  Component  companies  include  electric  utilities,  gas utilities and
                    water utilities.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------



- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      STYLE/                                        INVESTMENT OBJECTIVES/POLICIES                                         PORTFOLIO
       TYPE                                                                                                                 ADVISOR/
                                                                                                                          SUB-ADVISOR
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- --------------------------------------------------------------------------------------------------------------------------------------------
THE PROFUND VP PORTFOLIOS  DESCRIBED  BELOW ARE AVAILABLE AS  SUB-ACCOUNTS  TO ALL ANNUITY  OWNERS.  EACH  PORTFOLIO  PURSUES AN INVESTMENT
STRATEGY THAT SEEKS TO PROVIDE DAILY  INVESTMENT  RESULTS,  BEFORE FEES AND EXPENSES,  THAT MATCH A WIDELY FOLLOWED  INDEX,  INCREASED BY A
SPECIFIED FACTOR RELATIVE TO THE INDEX,  MATCH THE INVERSE OF THE INDEX OR THE INVERSE OF THE INDEX MULTIPLIED BY A SPECIFIED  FACTOR.  THE
INVESTMENT  STRATEGY OF SOME OF THE PORTFOLIOS MAY MAGNIFY (BOTH POSITIVELY AND NEGATIVELY) THE DAILY INVESTMENT  RESULTS OF THE APPLICABLE
INDEX.  IT IS RECOMMENDED  THAT ONLY THOSE ANNUITY OWNERS WHO ENGAGE A FINANCIAL  ADVISOR TO ALLOCATE THEIR ACCOUNT VALUE USING A STRATEGIC
OR TACTICAL  ASSET  ALLOCATION  STRATEGY  INVEST IN THESE  PORTFOLIOS.  WE HAVE  ARRANGED  THE  PORTFOLIOS  BASED ON THE INDEX ON WHICH ITS
INVESTMENT STRATEGY IS BASED.
- --------------------------------------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------------------------------------------
The S&P 500 Index(R)is a widely used measure of large-cap  U.S. stock market  performance.  It includes a  representative  sample of leading
companies in leading  industries.  Companies  are selected for inclusion in the Index by Standard & Poor's(R)for being U.S.  companies  with
adequate liquidity, appropriate market capitalization financial viability and public float.
- --------------------------------------------------------------------------------------------------------------------------------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    ProFund VP Bull: seeks daily investment results,  before fees and expenses,  that correspond to   ProFund Advisors LLC
     S&P 500        the daily performance of the S&P 500(R)Index.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
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                    ProFund VP Bear: seeks daily investment results,  before fees and expenses,  that correspond to
                    the inverse  (opposite) of the daily  performance of the S&P 500(R)Index.  If ProFund VP Bear is
                    successful in meeting its objective,  its net asset value should gain  approximately  the same,
     S&P 500        on a  percentage  basis,  as any  decrease  in the S&P 500(R)Index when the Index  declines on a   ProFund Advisors LLC
                    given  day.  Conversely,  its  net  asset  value  should  lose  approximately  the  same,  on a
                    percentage basis, as any increase in the Index when the Index rises on a given day.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    ProFund VP UltraBull (f/k/a ProFund VP Bull Plus): seeks daily investment results,  before fees
                    and expenses,  that correspond to twice (200%) the daily  performance of the S&P 500(R)Index. If
                    the ProFund VP UltraBull is  successful  in meeting its  objective,  its net asset value should
                    gain  approximately  twice as much, on a percentage basis, as the S&P 500(R)Index when the Index
     S&P 500        rises on a given day.  Conversely,  its net asset  value  should  lose  approximately  twice as   ProFund Advisors LLC
                    much,  on a percentage  basis,  as the Index when the Index  declines on a given day.  Prior to
                    May 1, 2003,  ProFund VP UltraBull was named "ProFund VP Bull Plus" and sought daily investment
                    results that corresponded to one and one-half times the daily performance of the S&P 500(R)Index
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- --------------------------------------------------------------------------------------------------------------------------------------------
The NASDAQ-100 Index(R)is a market capitalization  weighted index that includes 100 of the largest domestic and international  non-financial
companies listed on The NASDAQ Stock Market.
- --------------------------------------------------------------------------------------------------------------------------------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
    NASDAQ 100      ProFund VP OTC: seeks daily investment  results,  before fees and expenses,  that correspond to   ProFund Advisors LLC
                    the daily  performance  of the NASDAQ-100  Index(R).  "OTC" in the name of ProFund VP OTC reflers
                    to  securities  that do not  trade on a U.S.  securities  exchange,  as  registered  under  the
                    Securities Exchange Act of 1934.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
    NASDAQ 100      ProFund  VP  Short  OTC:  seeks  daily  investment  results,  before  fees and  expenses,  that   ProFund Advisors LLC
                    correspond to the inverse  (opposite) of the daily  performance  of the NASDAQ-100  Index(R).  If
                    ProFund VP Short OTC is  successful in meeting its  objective,  its net asset value should gain
                    approximately  the same, on a percentage  basis, as any decrease in the NASDAQ-100  Index(R)when
                    the Index declines on a given day.  Conversely,  its net asset value should lose  approximately
                    the same, on a percentage  basis,  as any increase in the Index when the Index rises on a given
                    day.  "OTC" in the name of  ProFund VP Short OTC  refers to  securities  that do not trade on a
                    U.S. securities exchange, as registered under the Securities Exchange Act of 1934.
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- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      STYLE/                                        INVESTMENT OBJECTIVES/POLICIES                                         PORTFOLIO
       TYPE                                                                                                                 ADVISOR/
                                                                                                                          SUB-ADVISOR
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
    NASDAQ 100      ProFund VP UltraOTC:  seeks daily investment results, before fees and expenses, that correspond   ProFund Advisors LLC
                    to twice  (200%) the daily  performance  of the NASDAQ-  100 Index(R).  If ProFund VP UltraOTC is
                    successful in meeting its  objective,  its net asset value should gain  approximately  twice as
                    much,  on a percentage  basis,  as the  NASDAQ-100  Index(R)when the Index rises on a given day.
                    Conversely,  its net asset  value  should lose  approximately  twice as much,  on a  percentage
                    basis,  as the Index when the Index  declines  on a given day.  "OTC" in the name of ProFund VP
                    UltraOTC refers to securities that do not trade on a U.S.  securities  exchange,  as registered
                    under the Securities Exchange Act of 1934.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- --------------------------------------------------------------------------------------------------------------------------------------------
The S&P MidCap 400 Index(R)is a widely used  measure of  mid-sized  company  U.S.  stock  market  performance.  Companies  are  selected for
inclusion  in the Index by  Standard & Poor's(R)for being U.S.  companies  with  adequate  liquidity,  appropriate  market  capitalization,
financial viability and public float.
- --------------------------------------------------------------------------------------------------------------------------------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
  S&P MIDCAP 400    ProFund VP Mid-Cap  Value:  seeks daily  investment  results,  before fees and  expenses,  that   ProFund Advisors LLC
                    correspond  to the  daily  performance  of the  S&P  MidCap  400/Barra  Value  Index(R).  The S&P
                    MidCap400/Barra  Value Index(R)is designed to differentiate  between fast growing  companies and
                    slower  growing or  undervalued  companies.  Standard & Poor's and Barra  cooperate to employ a
                    price-to-book value calculation whereby the market  capitalization of the S&P MidCap 400 Index(R)
                    is divided equally between growth and value.  The index is rebalanced twice per year.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    ProFund VP Mid-Cap  Growth:  seeks daily  investment  results,  before fees and expenses,  that
                    correspond to the daily  performance of the S&P MidCap 400/Barra Growth Index(R).  The S&P MidCap
                    400/Barra Growth Index(R)is designed to differentiate  between fast growing companies and slower
  S&P MIDCAP 400    growing  or  undervalued  companies.  Standard  &  Poor's  and  Barra  cooperate  to  employ  a   ProFund Advisors LLC
                    price-to-book value calculation whereby the market  capitalization of the S&P MidCap 400 Index(R)
                    is divided equally between growth and value.  The Index is rebalanced twice per year.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    ProFund VP  UltraMid-Cap:  seeks  daily  investment  results,  before fees and  expenses,  that
                    correspond to twice (200%) the daily  performance  of the S&P MidCap 400 Index(R).  If ProFund VP
                    UltraMid-Cap  is  successful  in  meeting  its  objective,  its net  asset  value  should  gain
  S&P MIDCAP 400    approximately  twice as much,  on a  percentage  basis,  as the S&P MidCap 400 Index(R)when the   ProFund Advisors LLC
                    Index rises on a given day.  Conversely,  its net asset value should lose  approximately  twice
                    as much, on a percentage basis, as the Index when the Index declines on a given day.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- --------------------------------------------------------------------------------------------------------------------------------------------
The S&P SmallCap 600 Index(R)consists of 600 domestic  stocks chosen for market size,  liquidity,  and industry group  representation.  The
Index comprises stocks from the industrial, utility, financial, and transportation sectors.
- --------------------------------------------------------------------------------------------------------------------------------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
 S&P SMALLCAP 600   ProFund VP Small-Cap Value:  seeks daily  investment  results,  before fees and expenses,  that   ProFund Advisors LLC
                    correspond  to the daily  performance  of the S&P  SmallCap  600/Barra  Value  Index(R).  The S&P
                    SmallCap  600/Barra Value Index(R)is designed to  differentiate  between fast growing  companies
                    and slower growing or undervalued  companies.  Standard & Poor's and Barra  cooperate to employ
                    a price-to-book  value  calculation  whereby the market  capitalization of the S&P SmallCap 600
                    Index(R)is divided equally between growth and value.  The index is rebalanced twice per year.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
 S&P SMALLCAP 600   ProFund VP Small-Cap Growth:  seeks daily investment  results,  before fees and expenses,  that   ProFund Advisors LLC
                    correspond  to the daily  performance  of the S&P SmallCap  600/Barra  Growth  Index(R).  The S&P
                    SmallCap  600/Barra Growth Index(R)is designed to differentiate  between fast growing  companies
                    and slower growing or undervalued  companies.  Standard & Poor's and Barra  cooperate to employ
                    a price-to-book  value  calculation  whereby the market  capitalization of the S&P SmallCap 600
                    Index(R)is divided equally between growth and value.  The Index is rebalanced twice per year.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------



- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      STYLE/                                        INVESTMENT OBJECTIVES/POLICIES                                         PORTFOLIO
       TYPE                                                                                                                 ADVISOR/
                                                                                                                          SUB-ADVISOR
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- --------------------------------------------------------------------------------------------------------------------------------------------
The Russell 2000 Index(R)measures the performance of the 2,000 small companies in the Russell 3000 Index(R)representing  approximately 8% of
the total market  capitalization  of the Russell 3000 Index(R),  which in turn  represents  approximately  98% of the investable  U.S. equity
market.
- --------------------------------------------------------------------------------------------------------------------------------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
   RUSSELL 2000     ProFund VP  UltraSmall-Cap:  seeks daily  investment  results,  before fees and expenses,  that   ProFund Advisors LLC
                    correspond  to twice (200%) the daily  performance  of the Russell  2000(R)Index.  If ProFund VP
                    UltraSmall-Cap  is  successful  in meeting  its  objective,  its net asset  value  should  gain
                    approximately  twice as much, on a percentage  basis, as the Russell 2000 Index(R)when the Index
                    rises on a given day.  Conversely,  its net asset  value  should  lose  approximately  twice as
                    much, on a percentage basis, as the Index when the Index declines on a given day.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    ------------------------------------------------------------------------------------------------ -----------------------
 U.S. GOV'T BOND    ProFund VP U.S.  Government  Plus: seeks daily  investment  results,  before fees and expenses,   ProFund Advisors LLC
                    that  correspond  to one and  one-quarter  times  (125%) the daily  price  movement of the most
                    recently  issued  30-year U.S.  Treasury  Bond ("Long  Bond").  In  accordance  with its stated
                    objective,  the net asset value of ProFund VP U.S. Government Plus generally should decrease as
                    interest  rates  rise.  If  ProFund  VP U.S.  Government  Plus is  successful  in  meeting  its
                    objective,  its net asset value should gain  approximately  one and one-quarter times (125%) as
                    much,  on a  percentage  basis,  as any  daily  increase  in the  Long  Bond  on a  given  day.
                    Conversely,  its net asset value should lose  approximately one and one-quarter (125%) as much,
                    on a percentage basis, as any daily decrease in the Long Bond on a given day.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    ------------------------------------------------------------------------------------------------ -----------------------
 U.S. GOV'T BOND    ProFund VP Rising Rates Opportunity:  seeks daily investment results, before fees and expenses,   ProFund Advisors LLC
                    that correspond to one and one-quarter  times (125%) the inverse  (opposite) of the daily price
                    movement of the most recently  issued Long Bond. In accordance with its stated  objective,  the
                    net asset value of ProFund VP rising Rates  Opportunity  generally  should decrease as interest
                    rates fall. If ProFund VP Rising Rates  Opportunity  is  successful  in meeting its  objective,
                    its net asset value should gain  approximately  one and one-quarter  times (125%) as much, on a
                    percentage  basis, as any daily decrease in the Long Bond on a given day.  Conversely,  its net
                    asset  value  should  lose  approximately  one and  one-quarter  times  (125%)  as  much,  on a
                    percentage basis, as any daily increase in the Long Bond on a given day.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
- --------------------------------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------------------------------

Each  portfolio of the First Defined  Portfolio Fund LLC invests in the securities of a relatively few number of issuers or in a particular
sector of the economy.  Since the assets of each  portfolio are invested in a limited number of issuers or a limited sector of the economy,
the net asset value of the portfolio may be more susceptible to a single adverse economic,  political or regulatory occurrence.  Certain of
the  portfolios  may also be subject to  additional  market risk due to their  policy of  investing  based on an  investment  strategy  and
generally not buying or selling  securities in response to market  fluctuations.  Each  portfolio's  relative lack of diversity and limited
ongoing management may subject Owners to greater market risk than other portfolios.

The stock selection date for each of the strategy  Portfolios of the First Defined  Portfolio Fund LLC is on or about December 31st of each
year. The holdings for each strategy  Portfolio  will be adjusted  annually on or about  December 31st in accordance  with the  Portfolio's
investment  strategy.  At that time,  the  percentage  relationship  among the shares of each issuer held by the Portfolio is  established.
Through the next one-year  period that  percentage  will be  maintained  as closely as  practicable  when the  Portfolio  makes  subsequent
purchases and sales of the securities.
- --------------------------------------------------------------------------------------------------------------------------------------------
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
    LARGE CAP       First Trust(R)10 Uncommon  Values:  seeks to provide  above-average  capital  appreciation.  The   First Trust Advisors
     BLEND          Portfolio  seeks to achieve its  objective  by  investing  primarily  in the ten common  stocks           L.P.
                    selected by the Investment  Policy Committee of Lehman Brothers Inc.  ("Lehman  Brothers") with
                    the assistance of the Research  Department of Lehman  Brothers which, in their opinion have the
                    greatest  potential for capital  appreciation  during the next year. The stocks included in the
                    Portfolio  are adjusted  annually on or about July 1st in  accordance  with the  selections  of
                    Lehman Brothers.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------



- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
      STYLE/                                        INVESTMENT OBJECTIVES/POLICIES                                         PORTFOLIO
       TYPE                                                                                                                 ADVISOR/
                                                                                                                          SUB-ADVISOR
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------
                    ------------------------------------------------------------------------------------------------ -----------------------
                    The  Prudential  Series  Fund,  Inc.  - SP  Jennison  International  Growth:  seeks to  provide
                    long-term   growth  of  capital.   The   Portfolio   pursues  its  objective  by  investing  in
                    equity-related  securities of foreign  issuers that the  Sub-advisor  believes will increase in
                    value over a period of years.  The  Portfolio  invests  primarily  in the common stock of large
                    and  medium-sized  foreign  companies.  Under normal  circumstances,  the Portfolio  invests at
     INTER-         least 65% of its total  assets in common  stock of foreign  companies  operating or based in at
 NATIONAL EQUITY    least five different  countries.  The Portfolio  looks  primarily for stocks of companies whose        Prudential
                    earnings are growing at a faster rate than other companies and that have  above-average  growth     Investments LLC/
                    in earnings and cash flow, improving profitability,  strong balance sheets, management strength   Jennison Associates
                    and strong  market  share for its  products.  The  Portfolio  also tries to buy such  stocks at           LLC
                    attractive prices in relation to their growth prospects.
- ------------------- ------------------------------------------------------------------------------------------------ -----------------------

"Standard & Poor's(R)," "S&P(R)," "S&P 500(R)," "Standard & Poor's 500," and "500" are trademarks of the McGraw-Hill  Companies,  Inc. and
have been licensed for use by American Skandia Investment Services,  Incorporated.  The Portfolio is not sponsored,  endorsed,  sold
or promoted by Standard & Poor's and  Standard & Poor's  makes no  representation  regarding  the  advisability  of investing in the
Portfolio.

The First Trust(R)10 Uncommon Values  portfolio is not sponsored or created by Lehman  Brothers,  Inc.  ("Lehman  Brothers").  Lehman
Brothers' only  relationship  to First Trust is the licensing of certain  trademarks  and trade names of Lehman  Brothers and of the
"10 Uncommon  Values" which is  determined,  composed and calculated by Lehman  Brothers  without regard to First Trust or the First
Trust(R)10 Uncommon Values portfolio.

Dow Jones has no  relationship  to the ProFunds VP, other than the  licensing of the Dow Jones sector  indices and its service marks
for use in  connection  with the ProFunds VP. The ProFunds VP are not  sponsored,  endorsed,  sold, or promoted by Standard & Poor's
or NASDAQ,  and neither  Standard & Poor's nor NASDAQ  makes any  representations  regarding  the  advisability  of investing in the
ProFunds VP.

WHAT ARE THE FIXED INVESTMENT OPTIONS?
We offer fixed  investment  options of  different  durations  during the  accumulation  period.  These  "Fixed  Allocations"  earn a
guaranteed  fixed rate of interest for a specified  period of time,  called the "Guarantee  Period." In most states,  we offer Fixed
Allocations  with Guarantee  Periods from 1 to 10 years.  We may also offer special  purpose Fixed  Allocations for use with certain
optional  investment  programs.  We guarantee the fixed rate for the entire Guarantee Period.  However,  if you withdraw or transfer
Account Value before the end of the Guarantee  Period,  we will adjust the value of your  withdrawal or transfer based on a formula,
called a "Market Value  Adjustment."  The Market Value  Adjustment  can either be positive or negative,  depending on the rates that
are currently  being  credited on Fixed  Allocations.  Please refer to the section  entitled  "How does the Market Value  Adjustment
Work?" for a description  of the formula along with examples of how it is  calculated.  You may allocate  Account Value to more than
one Fixed Allocation at a time.

Fixed  Allocations  may not be available in all states.  Availability  of Fixed  Allocations  is subject to change and may differ by
state and by the annuity product you purchase.  Please call American Skandia at  1-800-680-8920  to determine  availability of Fixed
Allocations in your state and for your annuity product.

FEES AND CHARGES

WHAT ARE THE CONTRACT FEES AND CHARGES?

Contingent  Deferred  Sales Charge:  We do not deduct a sales charge from Purchase  Payments you make to your Annuity.  However,  we
may deduct a Contingent  Deferred  Sales Charge or CDSC if you  surrender  your Annuity or when you make a partial  withdrawal.  The
CDSC reimburses us for expenses related to sales and distribution of the Annuity,  including  commissions,  marketing  materials and
other  promotional  expenses.  The CDSC is calculated as a percentage of your Purchase Payment being surrendered or withdrawn during
the applicable  Annuity Year.  For purposes of  calculating  the CDSC, we consider the year following the Issue Date of your Annuity
as Year 1. The amount of the CDSC  decreases  over time,  measured  from the Issue Date of the  Annuity.  The CDSC  percentages  are
shown below.

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

                  YEARS                1      2     3      4      5     6      7     8      9     10    11+
                  ------------------- ----- ------ ----- ------ ------ ----- ------ ----- ------ ----- ------
                  ------------------- ----- ------ ----- ------ ------ ----- ------ ----- ------ ----- ------

                  CHARGE (%)          9.0    9.0   8.5    8.0    7.0   6.0    5.0   4.0    3.0   2.0    0.0
                  ------------------- ----- ------ ----- ------ ------ ----- ------ ----- ------ ----- ------

The CDSC  period is based on the Issue Date of the  Annuity,  not on the date each  Purchase  Payment  is  applied  to the  Annuity.
Purchase  Payments  applied to the Annuity  after the Issue Date do not have their own CDSC  period.  Under  certain  circumstances,
during the first ten (10)  Annuity  Years,  you can  withdraw a limited  amount from your  Annuity  without  paying a CDSC.  This is
referred  to as a "Free  Withdrawal."  Free  Withdrawals  are not  treated as a  withdrawal  of Purchase  Payments  for  purposes of
calculating  the CDSC on a subsequent  withdrawal  or surrender.  Withdrawals  of amounts  greater than the maximum Free  Withdrawal
amount are  treated as a  withdrawal  of  Purchase  Payments  and will be  assessed a CDSC  during  Annuity  Years 1 through 10. For
purposes of calculating  the CDSC on surrender or a partial  withdrawal,  the Purchase  Payments being withdrawn may be greater than
your  remaining  Account  Value or the  amount of your  withdrawal  request.  This is most  likely  to occur if you have made  prior
withdrawals under the Free Withdrawal provision or if your Account Value has declined in value due to negative market performance.

We may  waive  the CDSC  under  certain  medically-related  circumstances  or when  taking a Minimum  Distribution  from an  Annuity
purchased  as a  "qualified"  investment.  Free  Withdrawals,  Medically-Related  Surrenders  and  Minimum  Distributions  are  each
explained more fully in the section entitled "Access to Your Account Value".

Transfer  Fee:  Currently,  you may make twenty (20) free  transfers  between  investment  options each Annuity Year. We will charge
$10.00 for each  transfer  after the  twentieth in each Annuity  Year.  We do not consider  transfers  made as part of a dollar cost
averaging  program when we count the twenty free  transfers.  Transfers made as part of a rebalancing,  market timing or third party
investment  advisory  service will be subject to the  twenty-transfer  limit.  However,  all transfers  made on the same day will be
treated as one (1)  transfer.  Renewals or transfers of Account Value from a Fixed  Allocation  at the end of its  Guarantee  Period
are not  subject  to the  Transfer  Fee and are not  counted  toward  the twenty  free  transfers.  We may reduce the number of free
transfers  allowable  each  Annuity  Year  (subject to a minimum of eight)  without  charging a Transfer  Fee unless you make use of
electronic  means to transmit  your  transfer  requests.  We may  eliminate  the  Transfer  Fee for  transfer  requests  transmitted
electronically or through other means that reduce our processing costs.

Annual  Maintenance Fee: During the accumulation  period we deduct an Annual  Maintenance Fee. The Annual  Maintenance Fee is $35.00
or 2% of your Account Value invested in the variable  investment  options,  whichever is less. This fee will be deducted annually on
the  anniversary  of the Issue Date of your Annuity or, if you surrender  your Annuity  during the Annuity Year, the fee is deducted
at the time of surrender.  We may increase the Annual  Maintenance  Fee.  However,  any increase will only apply to Annuities issued
after the date of the increase.

Tax  Charges:  Several  states and some  municipalities  charge  premium  taxes or similar  taxes.  The amount of tax will vary from
jurisdiction  to  jurisdiction  and is subject to change.  The tax charge  currently  ranges up to 3 1/2%. We generally will deduct the
amount of tax payable at the time the tax is imposed,  but may also decide to deduct tax charges from each  Purchase  Payment at the
time of a withdrawal  or surrender of your Annuity or at the time you elect to begin  receiving  annuity  payments.  We may assess a
charge against the Sub-accounts and the Fixed Allocations equal to any taxes which may be imposed upon the separate accounts.

WHAT CHARGES APPLY SOLELY TO THE VARIABLE INVESTMENT OPTIONS?

Insurance  Charge:  We deduct an  Insurance  Charge  daily  against the average  daily assets  allocated  to the  Sub-accounts.  The
Insurance  Charge is the  combination  of the Mortality & Expense Risk Charge (0.50%) and the  Administration  Charge  (0.15%).  The
total charge is equal to 0.65% on an annual basis.  The Insurance  Charge is intended to compensate  American  Skandia for providing
the insurance  benefits under the Annuity,  including the Annuity's  basic death benefit that provides  guaranteed  benefits to your
beneficiaries  even if the market  declines  and the risk that persons we  guarantee  annuity  payments to will live longer than our
assumptions.  The charge also covers  administrative costs associated with providing the Annuity benefits,  including preparation of
the contract,  confirmation  statements,  annual account statements and annual reports, legal and accounting fees as well as various
related  expenses.  Finally,  the charge  covers the risk that our  assumptions  about the mortality  risks and expenses  under this
Annuity are  incorrect and that we have agreed not to increase  these  charges over time despite our actual  costs.  We may increase
the portion of the total  Insurance  Charge that is deducted for  administrative  costs;  however,  any increase  will only apply to
Annuities issued after the date of the increase.

American  Skandia may make a profit on the Insurance  Charge if, over time,  the actual cost of providing the  guaranteed  insurance
obligations  under the Annuity are less than the amount we deduct for the  Insurance  Charge.  To the extent we make a profit on the
Insurance  Charge,  such profit may be used for any other  corporate  purpose,  including  payment of other  expenses  that American
Skandia incurs in promoting,  issuing and  administering  the Annuity and to offset a portion of the costs  associated with offering
Credits which are funded  through  American  Skandia's  general  account.  The Insurance  Charge is deducted  against your Annuity's
Account Value,  which  includes the amount of any Credits we apply to your Purchase  Payments and any increases or decreases in your
Account Value based on market  fluctuations of the  Sub-accounts.  Any profit that American Skandia may make on the Insurance Charge
may include a profit on the portion of the Account Value that represents  Credits  applied to the Annuity,  as well as profits based
on market appreciation of the Sub-account values.

The  Insurance  Charge is not deducted  against  assets  allocated  to a Fixed  Allocation.  However,  the amount we credit to Fixed
Allocations may also reflect similar assumptions about the insurance guarantees provided under the Annuity.

Distribution  Charge:  We deduct a  Distribution  Charge  daily  against the  average  assets  allocated  to the  Sub-accounts.  The
Distribution  Charge is equal to 1.00% on an annual  basis in Annuity  Years 1 through  10.  After the end of the first ten  Annuity
Years, the 1.00% charge for  distribution  will no longer be assessed.  The  Distribution  Charge is intended to compensate us for a
portion of our acquisition  expenses under the Annuity,  including  promotion and  distribution of the Annuity and costs  associated
with offering  Credits which are funded through American  Skandia's  general  account.  The Distribution  Charge is deducted against
your  Annuity's  Account  Value,  which  includes the amount of any Credits we apply to your Purchase  Payments and any increases or
decreases in your Account Value based on market  fluctuations of the  Sub-accounts.  A portion of the proceeds that American Skandia
receives  from the  Distribution  Charge may include  amounts  based on the Account  Value that  represents  Credits  applied to the
Annuity, as well as amounts based on market appreciation of the Sub-account values.

Optional  Benefits:  If you elect to purchase one or more optional  benefits,  we will deduct an additional  charge on a daily basis
from your Account Value allocated to the  Sub-accounts  with the exception of the Guaranteed  Minimum Income Benefit which charge is
assessed  against the Protected Income Value and deducted  annually in arrears.  The charge for each optional benefit is deducted in
addition to the Insurance Charge due to the increased  insurance risk associated with the optional  benefits.  The additional charge
is  included  in the daily  calculation  of the Unit  Price for each  Sub-account.  Please  refer to the  sections  entitled  "Death
Benefit" and "Living Benefit Programs" for a description of the charge for each Optional Benefit.

WHAT CHARGES ARE ASSESSED BY THE PORTFOLIOS?
We do not assess any charges directly  against the Portfolios.  However,  each Portfolio  charges a total annual fee comprised of an
investment  management  fee,  operating  expenses  and any  distribution  and service  (12b-1)  fees that may apply.  These fees are
deducted  daily by each  Portfolio  before it provides  American  Skandia with the net asset value as of the close of business  each
day.  More  detailed  information  about fees and  charges  can be found in the  prospectuses  for the  Portfolios.  Please also see
"Service Fees Payable by Underlying Funds".

WHAT CHARGES APPLY TO THE FIXED ALLOCATIONS?
No specific fee or expenses are deducted when determining the rate we credit to a Fixed  Allocation.  However,  for some of the same
reasons that we deduct the Insurance  Charge against Account Value allocated to the  Sub-accounts,  we also take into  consideration
mortality,  expense,  administration,  profit and other factors in determining  the interest  rates we credit to Fixed  Allocations.
Any CDSC or Tax Charge applies to amounts that are taken from the variable  investment  options or the Fixed  Allocations.  A Market
Value Adjustment may also apply to transfers, certain withdrawals, surrender or annuitization from a Fixed Allocation.

WHAT CHARGES APPLY IF I CHOOSE AN ANNUITY PAYMENT OPTION?
In certain states a tax is due if and when you exercise your right to receive  periodic  annuity  payments.  The amount payable will
depend on the applicable  jurisdiction  and on the annuity  payment  option you select.  If you select a fixed payment  option,  the
amount of each fixed payment will depend on the Account  Value of your Annuity when you elected to  annuitize.  There is no specific
charge  deducted  from these  payments;  however,  the amount of each  annuity  payment  reflects  assumptions  about our  insurance
expenses.  If you select a variable  payment option that we may offer,  then the amount of your benefits will reflect changes in the
value of your Annuity and will continue to be subject to an insurance charge.

EXCEPTIONS/REDUCTIONS TO FEES AND CHARGES
We may reduce or eliminate  certain  fees and charges or alter the manner in which the  particular  fee or charge is  deducted.  For
example,  we may  reduce  the  amount of the CDSC or the length of time it  applies,  reduce or  eliminate  the amount of the Annual
Maintenance  Fee or reduce the  portion of the total  Insurance  Charge that is deducted  as an  Administration  Charge.  Generally,
these types of changes will be based on a reduction to our sales,  maintenance or  administrative  expenses due to the nature of the
individual or group  purchasing  the Annuity.  Some of the factors we might consider in making such a decision are: (a) the size and
type of group; (b) the number of Annuities  purchased by an Owner;  (c) the amount of Purchase  Payments or likelihood of additional
Purchase Payments;  and/or (d) other transactions where sales,  maintenance or administrative  expenses are likely to be reduced. We
will not discriminate  unfairly between Annuity  purchasers if and when we reduce the portion of the Insurance Charge  attributed to
the charge covering administrative costs.

PURCHASING YOUR ANNUITY

WHAT ARE OUR REQUIREMENTS FOR PURCHASING THE ANNUITY?

Initial  Purchase  Payment:  You must make a minimum initial Purchase  Payment of $10,000.  However,  if you decide to make payments
under a systematic  investment or "bank drafting"  program,  we will accept a lower initial Purchase  Payment provided that,  within
the first Annuity Year, you make at least $10,000 in total Purchase Payments.

Where allowed by law,  initial  Purchase  Payments in excess of $1,000,000  require our approval prior to  acceptance.  We may apply
certain limitations and/or  restrictions on the Annuity as a condition of our acceptance,  including limiting the liquidity features
or the Death Benefit protection provided under the Annuity,  limiting the right to make additional  Purchase Payments,  changing the
number of transfers  allowable  under the Annuity or restricting  the  Sub-accounts  that are available.  Other  limitations  and/or
restrictions may apply.

Except as noted below,  Purchase  Payments  must be submitted by check drawn on a U.S.  bank, in U.S.  dollars,  and made payable to
American  Skandia.  Purchase  Payments  may also be  submitted  via 1035  exchange  or  direct  transfer  of  funds.  Under  certain
circumstances,  Purchase  Payments may be transmitted to American  Skandia via wiring funds through your  investment  professional's
broker-dealer  firm.  Additional  Purchase Payments may also be applied to your Annuity under an arrangement  called "bank drafting"
                      ----------
where you  authorize us to deduct money  directly from your bank account.  We call our bank  drafting  program "Auto Saver".  We may
reject any  payment if it is  received  in an  unacceptable  form.  Our  acceptance  of a check is subject to our ability to collect
funds.

Age  Restrictions:  The Owner must be age 75 or under as of the Issue Date of the  Annuity.  If the  Annuity is owned  jointly,  the
oldest of the Owners must be age 75 or under on the Issue  Date.  If the Annuity is owned by an entity,  the  Annuitant  must be age
75 or under as of the Issue Date.  You should  consider your need to access your Account  Value and whether the Annuity's  liquidity
features  will satisfy that need. If you take a  distribution  prior to age 591/2, you may be subject to a 10% penalty in addition to
ordinary  income taxes on any gain.  The  availability  of certain  optional  benefits may vary based on the age of the Owner on the
Issue Date of the Annuity.

Special Considerations for Purchasers of Bonus or Credit Products
4        This Annuity features an annual Insurance  Charge of 0.65% and an annual  Distribution  Charge of 1.00%. We only deduct the
     Distribution  Charge during the first 10 years  following the effective  date of your Annuity.  During the first 10 years,  the
     total asset-based charges on this Annuity are higher than many of our other annuities,  including other annuities we offer that
     apply  credits  to  purchase  payments.  After  the 10th  year,  we only  deduct  the  Insurance  Charge,  making  the  Annuity
     substantially less expensive than most of our other annuities.
4        Unlike many other  annuities,  the  contingent  deferred sales charge (CDSC) that may apply to a withdrawal or surrender of
     your Annuity is based on the number of years since the effective  date of your Annuity.  We do not assess a separate CDSC based
     on the date that each  Purchase  Payment is applied.  The CDSC on this Annuity is higher and is deducted for a longer period of
     time as compared to our other  annuities.  As with any investment  product that features a CDSC, you should  consider your need
     to access your account  value during the CDSC period and whether the  liquidity  provision  under the Annuity will satisfy that
     need. The CDSC is only deducted if you make a withdrawal  that exceeds the free  withdrawal  amount or choose to surrender your
     Annuity.  If you make a withdrawal  or surrender  your Annuity and are subject to a CDSC, we do not take back the XTra CreditSM
     amount.
4        The XTra  CreditSM  amount is included in your Account  Value.  However,  American  Skandia may take back the original XTra
     CreditSM amount applied to your Purchase  Payment if you die, or elect to withdraw all or a portion of your Account Value under
     the  medically-related  surrender provision,  within 12 months of having received an XTra CreditSM amount. In either situation,
     the value of the XTra  CreditSM  amount could be  substantially  reduced.  However,  any  investment  gain on the XTra CreditSM
     amount will not be taken back.  Additional  conditions and  restrictions  apply. We do not deduct a CDSC in any situation where
     we take back the XTra CreditSM amount.
4        We offer other  annuities  where we apply an XTra  CreditSM to your annuity with each purchase  payment you make.  The XTra
     CreditSM  amount  we apply to  purchase  payments  on those  annuities  is  generally  less  than on this  Annuity.  The  total
     asset-based  charges on those  annuities  are lower during the first 10 years but are higher than this  Annuity  after the 10th
     year.  The CDSC is also lower and is  deducted  for a shorter  period of time than on this  Annuity;  however the CDSC on those
     annuities applies separately to each purchase payment.

Owner, Annuitant and Beneficiary Designations: On your Application, we will ask you to name the Owner(s), Annuitant and one or
more Beneficiaries for your Annuity.

|X|      Owner:  The  Owner(s)  holds all rights  under the  Annuity.  You may name more than one Owner in which case all  ownership
         -----
       rights are held  jointly.  However,  this  Annuity does not provide a right of  survivorship.  Refer to the Glossary of Terms
       for a complete description of the term "Owner."
|X|      Annuitant:  The  Annuitant is the person we agree to make annuity  payments to and upon whose life we continue to make such
         ---------
       payments.  You must name an Annuitant who is a natural  person.  We do not accept a designation  of joint  Annuitants  during
       the accumulation  period. Where allowed by law, you may name one or more Contingent  Annuitants.  A Contingent Annuitant will
       become the Annuitant if the Annuitant  dies before the Annuity Date.  Please refer to the discussion of  "Considerations  for
       Contingent Annuitants" in the Tax Considerations section of the Prospectus.
|X|      Beneficiary:  The  Beneficiary  is the  person(s) or entity you name to receive the death  benefit.  If no  beneficiary  is
         -----------
       named the death benefit will be paid to you or your estate.

Your right to make  certain  designations  may be limited if your  Annuity is to be used as an IRA or other  "qualified"  investment
that is given  beneficial  tax treatment  under the Code.  You should seek  competent tax advice on the income,  estate and gift tax
implications of your designations.

MANAGING YOUR ANNUITY

MAY I CHANGE THE OWNER, ANNUITANT AND BENEFICIARY DESIGNATIONS?
You may change the Owner,  Annuitant and  Beneficiary  designations  by sending us a request in writing.  Where allowed by law, such
changes will be subject to our acceptance.  Some of the changes we will not accept include, but are not limited to:
|X|      a new  Owner  subsequent  to  the  death  of the  Owner  or  the  first  of  any  joint  Owners  to  die,  except  where  a
     spouse-Beneficiary has become the Owner as a result of an Owner's death;
|X|      a new Annuitant subsequent to the Annuity Date;
|X|      for "non-qualified" investments, a new Annuitant prior to the Annuity Date if the Annuity is owned by an entity; and
|X|      a change in Beneficiary if the Owner had previously made the designation irrevocable.

Spousal Owners/Spousal Beneficiaries
If an Annuity is co-owned by spouses,  we will assume that the sole primary  Beneficiary is the surviving spouse unless you elect an
alternative  Beneficiary  designation.  Unless you elect an alternative  Beneficiary  designation,  upon the death of either spousal
Owner,  the surviving  spouse may elect to assume  ownership of the Annuity instead of taking the Death Benefit  payment.  The Death
Benefit  that would have been  payable  will be the new  Account  Value of the  Annuity as of the date of due proof of death and any
required  proof of a spousal  relationship.  As of the date the  assumption  is effective,  the  surviving  spouse will have all the
rights and  benefits  that would be  available  under the Annuity to a new  purchaser  of the same  attained  age.  For  purposes of
determining  any future Death Benefit for the beneficiary of the surviving  spouse,  the new Account Value will be considered as the
initial Purchase  Payment.  No CDSC will apply to the new Account Value.  However,  any additional  Purchase  Payments applied after
the date the assumption is effective will be subject to all provisions of the Annuity, including the CDSC when applicable.

Spousal Contingent Annuitant
If the Annuity is owned by an entity and the surviving spouse is named as a Contingent  Annuitant,  upon the death of the Annuitant,
the  surviving  spouse  will  become the  Annuitant.  No Death  Benefit is payable  upon the death of the  Annuitant.  However,  the
Account  Value  of the  Annuity  as of the  date of due  proof of death of the  Annuitant  (and any  required  proof of the  spousal
relationship) will reflect the amount that would have been payable had a Death Benefit been paid.

MAY I RETURN THE ANNUITY IF I CHANGE MY MIND?

If after  purchasing  your Annuity you change your mind and decide that you do not want it, you may return it to us within a certain
period of time known as a right to cancel  period.  This is often  referred  to as a  "free-look."  Depending  on the state in which
you purchased your Annuity and, in some states,  if you purchased the Annuity as a replacement  for a prior  contract,  the right to
cancel period may be ten (10) days,  twenty-one (21) days or longer,  measured from the time that you received your Annuity.  If you
return your Annuity during the  applicable  period,  we will refund your current  Account Value plus any tax charge  deducted.  This
amount may be higher or lower than your  original  Purchase  Payment.  Where  required by law, we will return your  current  Account
Value or the amount of your  initial  Purchase  Payment,  whichever  is  greater.  The same  rules may apply to an  Annuity  that is
purchased as an IRA. In any situation  where we are required to return the greater of your  Purchase  Payment or Account  Value,  we
may  allocate  your  Account  Value to the AST Money  Market  Sub-account  during the right to cancel  period  and for a  reasonable
additional  amount of time to allow for  delivery of your  Annuity.  If you return your  Annuity,  we will not return any Credits we
applied to your Annuity based on your Purchase Payments.
                                -

MAY I MAKE ADDITIONAL PURCHASE PAYMENTS?
The minimum  amount that we accept as an additional  Purchase  Payment is $100 unless you  participate in "Auto Saver" or a periodic
purchase  payment  program.  We will allocate any additional  Purchase  Payments you make  according to your most recent  allocation
instructions,  unless you request new allocations when you submit a new Purchase Payment.  Additional  Purchase Payments may be paid
at any time before the Annuity Date.

MAY I MAKE SCHEDULED PAYMENTS DIRECTLY FROM MY BANK ACCOUNT?
You can make  additional  Purchase  Payments to your Annuity by  authorizing  us to deduct money directly from your bank account and
              ----------
applying  it to your  Annuity.  This type of program is often  called  "bank  drafting".  We call our bank  drafting  program  "Auto
Saver".  Purchase  Payments  made through Auto Saver may only be allocated to the variable  investment  options when  applied.  Bank
drafting allows you to invest in your Annuity with a lower initial  Purchase  Payment,  as long as you authorize  payments that will
equal at least  $10,000  during  the first 12  months  of your  Annuity.  We may  suspend  or cancel  bank  drafting  privileges  if
sufficient funds are not available from the applicable financial institution on any date that a transaction is scheduled to occur.

MAY I MAKE PURCHASE PAYMENTS THROUGH A SALARY REDUCTION PROGRAM?
These types of programs are only available with certain types of qualified  investments.  If your employer  sponsors such a program,
we may agree to accept periodic  Purchase  Payments through a salary  reduction  program as long as the allocations are made only to
variable investment options and the periodic Purchase Payments received in the first year total at least $10,000.

MANAGING YOUR ACCOUNT VALUE

HOW AND WHEN ARE PURCHASE PAYMENTS INVESTED?
(See "Valuing Your Investment" for a description of our procedure for pricing initial and subsequent Purchase Payments.)

Initial Purchase  Payment:  Once we accept your  application,  we invest your net Purchase Payment in the Annuity.  The net Purchase
Payment is your initial  Purchase  Payment minus any tax charges that may apply.  On your  application we ask you to provide us with
instructions  for  allocating  your Account  Value.  You can allocate  Account Value to one or more variable  investment  options or
Fixed Allocations.

In those  states  where we are  required  to return your  Purchase  Payment if you  exercise  your right to return the  Annuity,  we
initially  allocate  all  amounts  that  you  choose  to  allocate  to the  variable  investment  options  to the AST  Money  Market
Sub-account.  At the end of the  right to cancel  period  we will  reallocate  your  Account  Value  according  to your most  recent
allocation  instructions.  Where permitted by law, we will allocate your Purchase Payments  according to your initial  instructions,
without  temporarily  allocating  to the AST Money Market  Sub-account.  To do this,  we will ask that you execute our form called a
"return  waiver" that authorizes us to allocate your Purchase  Payment to your chosen  Sub-accounts  immediately.  If you submit the
"return  waiver" and then decide to return your Annuity  during the right to cancel  period,  you will receive your current  Account
Value,  minus the  amount of any  Credits,  which may be more or less than your  initial  Purchase  Payment  (see "May I Return  the
Annuity if I Change my Mind?").

Subsequent  Purchase  Payments:  We will allocate any additional  Purchase  Payments you make  according to your current  allocation
instructions.  If any rebalancing or asset  allocation  programs are in effect,  the allocation  should conform with such a program.
We assume that your current  allocation  instructions  are valid for subsequent  Purchase  Payments until you make a change to those
allocations or request new allocations when you submit a new Purchase Payment.

HOW DO I RECEIVE CREDITS?

We apply a "Credit" to your  Annuity's  Account Value each time you make a Purchase  Payment during the first six (6) Annuity Years.
The amount of the Credit is payable  from our general  account.  The amount of the Credit  depends on the Annuity  Year in which the
Purchase Payment(s) is made, according to the table below:


                                       ------------------------ ----------------------
                                            Annuity Year               Credit
                                       ------------------------ ----------------------
                                       ------------------------ ----------------------
                                                  1                     6.00%
                                                  2                     5.00%
                                                  3                     4.00%
                                                  4                     3.00%
                                                  5                     2.00%
                                                  6                     1.00%
                                                 7+                     0.00%
                                       ------------------------ ----------------------


HOW ARE CREDITS APPLIED TO MY ACCOUNT VALUE?
Each Credit is allocated to your Account  Value at the time the  Purchase  Payment is applied to your Account  Value.  The amount of
the Credit is allocated to the investment options in the same ratio as the applicable Purchase Payment is applied.

Examples of Applying Credits

Initial Purchase Payment
Assume you make an initial  Purchase  Payment of $10,000.  We would apply a 6.0% Credit to your  Purchase  Payment and  allocate the
amount of the Credit ($600 = $10,000 X .06) to your Account Value in the proportion that your Account Value is allocated.

Additional Purchase Payment in Annuity Year 2
Assume that you make an additional  Purchase  Payment of $5,000.  We would apply a 5.0% Credit to your Purchase Payment and allocate
the amount of the Credit ($250 = $5,000 X .05) to your Account Value.

Additional Purchase Payment in Annuity Year 6
Assume  that you make an  additional  Purchase  Payment of  $15,000.  We would  apply a 1.0%  Credit to your  Purchase  Payment  and
allocate the amount of the Credit ($150 = $15,000 X .01) to your Account Value.

====================================================================================================================================
The amount of any Credits applied to your Account Value can be recovered by American Skandia under certain circumstances:
====================================================================================================================================
|X|      any Credits  applied to your Account Value on Purchase  Payments made within the 12 months before the date of death will be
     recovered.
====================================================================================================================================
====================================================================================================================================
|X|      the amount  available  under the  medically-related  surrender  portion of the  Annuity  will not include the amount of any
     Credits  payable  on  Purchase  Payments  made  within  12 months  of the date the  Annuitant  first  became  eligible  for the
     medically-related surrender.
====================================================================================================================================
====================================================================================================================================
|X|      if you elect to "free-look" your Annuity, the amount returned to you will not include the amount of any Credits.
====================================================================================================================================
====================================================================================================================================

====================================================================================================================================
The value of the XTra CreditSM  amount will be  substantially  reduced if American  Skandia  recovers the XTra CreditSM amount under
these  circumstances.  However,  any investment  gain on the XTra CreditSM amount will not be taken back. We do not deduct a CDSC in
any situation where we recover the XTra CreditSM amount.  During the first 10 Annuity Years, the total  asset-based  charges on this
Annuity  (including the Insurance Charge and the Distribution  Charge) are higher than many of our other annuities,  including other
annuities we offer that apply  credits to purchase  payments.  After the 10th year,  only the Insurance  Charge is deducted,  making
the Annuity substantially less expensive than most of our other annuities.

Examples of Recovering Credits
The following are  hypothetical  examples of how Credits could be recovered by American  Skandia.  These examples do not cover every
potential situation.

Recovery from payment of Death Benefits
1.       Assume you purchase your Annuity with an initial  Purchase Payment of $50,000.  You make an additional  Purchase of $10,000
     in the 6th month after the Issue Date.  Both of the Purchase  Payments  received a 6.0% Credit,  for a total of $3,600.  If the
     Death Benefit  becomes  payable in the 9th month after the Issue Date,  the amount of the Death Benefit would be reduced by the
     entire amount of the prior Credits ($3,600).
2.       Assume you purchase your Annuity with an initial  Purchase Payment of $50,000.  You make an additional  Purchase of $10,000
     in the 6th month after the Issue Date. Both of the Purchase  Payments  received a 6.0% Credit,  for a total of $3,600. If death
     occurs in the 16th month  after the Issue  Date,  the amount of the Death  Benefit  would be reduced  but only in the amount of
     those Credits applied within the previous  12-months.  Since the initial  Purchase  Payment (and the Credits that were applied)
     occurred  more than  12-months  before the date of death,  the Death  Benefit would not be reduced by the amount of the Credits
     applied to the initial Purchase  Payment.  However,  the $10,000  additional  Purchase Payment was made within 12-months of the
     date of death.  Therefore,  the  amount of the Death  Benefit  would be reduced  by the  amount of the  Credits  payable on the
     additional Purchase Payment ($600).
3.       NOTE: If the Death Benefit would  otherwise  have been equal to the Purchase  Payments minus any  proportional  withdrawals
     due to poor  investment  performance,  we will not reduce the amount of the Death Benefit by the amount of the Credits as shown
     in Example 2 above.

Recovery from Medically-Related Surrenders
1.       Assume you purchase your Annuity with an initial  Purchase  Payment of $50,000.  You receive a Credit of $3,000  ($50,000 X
     .06).  The  Annuitant  is  diagnosed  as  terminally  ill in the 6th month  after the Issue Date and we grant  your  request to
     surrender your Annuity under the medically-related  surrender provision.  Assuming the Credits were applied within 12-months of
     the date of  diagnosis  of the  terminal  illness,  the  amount  that would be payable  under the  medically-related  surrender
     provision would be reduced by the entire amount of the Credits ($3,000).
2.       Assume you purchase your Annuity with an initial  Purchase Payment of $50,000.  You make an additional  Purchase of $10,000
     in the 6th month after the Issue  Date.  Both of the  Purchase  Payments  received a 6.0%  Credit,  for a total of $3,600.  The
     Annuitant  is diagnosed as  terminally  ill in the 16th month after the Issue Date and we grant your request to surrender  your
     Annuity  under the  medically-related  surrender  provision.  Since the initial  Purchase  Payment  (and the Credits  that were
     applied)  occurred  more than  12-months  before the  diagnosis,  the amount that would be payable  upon the  medically-related
     surrender  provision would not be reduced by the amount of the Credits applied to the initial Purchase  Payment.  However,  the
     $10,000  additional  Purchase Payment was made within 12-months of the date of diagnosis.  Therefore,  the amount that would be
     payable  under the  medically-related  surrender  provision  would be  reduced  by the  amount of the  Credits  payable  on the
     additional Purchase Payment ($600).

General Information about Credits
|X|      We do not consider Credits to be "investment in the contract" for income tax purposes.
|X|      You may not withdraw the amount of any Credits under the Free  Withdrawal  provision.  The Free  Withdrawal  provision only
     applies to withdrawals of Purchase Payments.

ARE THERE RESTRICTIONS OR CHARGES ON TRANSFERS BETWEEN INVESTMENT OPTIONS?
During the accumulation  period you may transfer  Account Value between  investment  options.  Transfers are not subject to taxation
on any gain.  We  currently  limit the number of  Sub-accounts  you can invest in at any one time to twenty (20).  However,  you can
invest in an unlimited  number of Fixed  Allocations.  We may require a minimum of $500 in each  Sub-account  you  allocate  Account
Value to at the time of any  allocation  or transfer.  If you request a transfer  and, as a result of the  transfer,  there would be
less than $500 in the Sub-account,  we may transfer the remaining  Account Value in the Sub-account pro rata to the other investment
options to which you transferred.

We may  impose  specific  restrictions  on  financial  transactions  for  certain  Portfolios  based on the  Portfolio's  investment
restrictions.  Currently,  any purchase,  redemption or transfer  involving the ProFunds VP  Sub-accounts  must be received by us no
later than one hour prior to any announced closing of the applicable  securities exchange (generally,  3:00 p.m. Eastern time) to be
processed on the current  Valuation  Day. The "cut-off"  time for such  financial  transactions  involving a ProFunds VP Sub-account
will be  extended  to1/2hour  prior to any  announced  closing  (generally,  3:30  p.m.  Eastern  time) for  transactions  submitted
electronically through American Skandia's Internet website (www.americanskandia.prudential.com).

Currently,  we charge $10.00 for each transfer after the twentieth (20th) in each Annuity Year,  including transfers made as part of
any rebalancing,  market timing,  asset allocation or similar program which you have authorized.  Transfers made as part of a dollar
cost  averaging  program do not count toward the twenty free  transfer  limit.  Renewals or transfers of Account  Value from a Fixed
Allocation at the end of its Guarantee  Period are not subject to the transfer  charge.  We may reduce the number of free  transfers
allowable  each  Annuity Year  (subject to a minimum of eight)  without  charging a Transfer  Fee unless you make use of  electronic
means to transmit your transfer  requests.  We may eliminate the Transfer Fee for transfer  requests  transmitted  electronically or
through other means that reduce our processing costs.

We reserve the right to limit the number of  transfers  in any Annuity  Year for all  existing  or new Owners.  We also  reserve the
right to limit the number of  transfers in any Annuity  Year or to refuse any  transfer  request for an Owner or certain  Owners if:
(a) we believe that excessive  trading or a specific  transfer request or group of transfer  requests may have a detrimental  effect
on Unit Values or the share prices of the  Portfolios;  or (b) we are informed by one or more of the Portfolios that the purchase or
redemption  of shares must be  restricted  because of  excessive  trading or a specific  transfer or group of transfers is deemed to
have a detrimental  effect on the share prices of affected  Portfolios.  Without  limiting the above, the most likely scenario where
either of the above could occur would be if the aggregate  amount of a trade or trades  represented a relatively large proportion of
the total assets of a particular  Portfolio.  Under such a circumstance,  we will process  transfers  according to our rules then in
effect and provide  notice if the  transfer  request was denied.  If a transfer  request is denied,  a new  transfer  request may be
required.

DO YOU OFFER DOLLAR COST AVERAGING?
Yes. We offer Dollar Cost Averaging during the accumulation  period.  Dollar Cost Averaging  allows you to  systematically  transfer
an amount  each month from one  investment  option to one or more other  investment  options.  You can choose to  transfer  earnings
only,  principal  plus  earnings  or a flat  dollar  amount.  Dollar  Cost  Averaging  allows you to invest  regularly  each  month,
regardless  of the current unit value (or price) of the  Sub-account(s)  you invest in. This enables you to purchase more units when
the market  price is low and fewer  units  when the market  price is high.  This may  result in a lower  average  cost of units over
time.  However,  there is no guarantee that Dollar Cost  Averaging will result in a profit or protect  against a loss in a declining
market.  We do not deduct a charge for participating in a Dollar Cost Averaging program.

You must have a minimum Account Value of at least $10,000 to enroll in a Dollar Cost Averaging program.

You can Dollar Cost Average from variable  investment  options or Fixed  Allocations.  Dollar Cost Averaging from Fixed  Allocations
is subject to a number of rules that include, but are not limited to the following:
|X|      You may only use Fixed Allocations with Guarantee Periods of 1, 2 or 3 years.
|X|      You may only Dollar Cost Average  earnings or principal  plus  earnings.  If  transferring  principal  plus  earnings,  the
     program must be designed to last the entire Guarantee Period for the Fixed Allocation.
|X|      Dollar Cost Averaging transfers from Fixed Allocations are not subject to a Market Value Adjustment.

NOTE:  When a Dollar Cost Averaging  program is established  from a Fixed  Allocation,  the fixed rate of interest we credit to your
Account  Value is applied to a declining  balance due to the  transfers of Account  Value to the  Sub-accounts  during the Guarantee
Period.  This will reduce the effective rate of return on the Fixed Allocation over the Guarantee Period.



DO YOU OFFER ANY AUTOMATIC REBALANCING PROGRAMS?
Yes. During the accumulation  period,  we offer automatic  rebalancing  among the variable  investment  options you choose.  You can
choose to have your Account  Value  rebalanced  quarterly,  semi-annually,  or annually.  On the  appropriate  date,  your  variable
investment  options are  rebalanced  to the  allocation  percentages  you request.  For example,  over time the  performance  of the
variable  investment  options will differ,  causing your percentage  allocations to shift. With automatic  rebalancing,  we transfer
the appropriate amount from the "overweighted"  Sub-accounts to the  "underweighted"  Sub-accounts to return your allocations to the
percentages  you request.  If you request a transfer  from or into any variable  investment  option  participating  in the automatic
rebalancing  program,  we will assume that you wish to change your rebalancing  percentages as well, and will  automatically  adjust
the rebalancing percentages in accordance with the transfer unless we receive alternate instructions from you.

You must have a minimum  Account Value of at least $10,000 to enroll in automatic  rebalancing.  All  rebalancing  transfers made on
the same day as part of an automatic  rebalancing  program are considered as one transfer when counting the number of transfers each
year toward the maximum number of free transfers.  We do not deduct a charge for participating in an automatic rebalancing program.

DO YOU OFFER ANY ASSET ALLOCATION PROGRAMS?
Yes.  During  the  accumulation  period,  we offer two  different  asset  allocation  programs  designed  for  American  Skandia  by
Morningstar  Associates,  LLC. Each program is available to Annuity  Owners at no additional  charge.  Each program is designed as a
tool to enable you and your  investment  professional  to develop an asset  allocation  program that is  appropriate  for you.  Your
investment  professional will help you to complete an investor questionnaire that will help you and your investment  professional to
determine  whether  participating  in a program is  appropriate  for you and to determine your  investment  style from which you can
choose the available model  portfolios.  We offer one program where you and your investment  professional  choose from the available
Sub-accounts  for each asset  class in the model  portfolio  you have chosen  based on your  answers to the  questionnaire.  You may
change your  selected  Sub-accounts  at any time.  We offer a second  program  where the  Sub-accounts  for each asset class in each
model  portfolio are designated  based on an objective  evaluation of the available  Sub-accounts.  If you elect the second program,
the selected  Sub-accounts within a model portfolio may change  periodically.  Under both programs,  assets allocated to the program
are  rebalanced  on a periodic  basis based on suggested  changes to the  allocation  percentages  for an asset class within a model
portfolio  or based  on  changes  in the  value of the  Sub-accounts.  Each  asset  allocation  program  is  subject  to  additional
limitations and restrictions which are more fully described in the enrollment form for the programs.

Asset  allocation  is a  sophisticated  method of  diversification  which  allocates  assets among asset  classes in order to manage
investment risk and enhance  returns over the long term.  However,  asset  allocation does not guarantee a profit or protect against
a loss.  You are not obligated to  participate  or to invest  according to the program  recommendations.  American  Skandia does not
intend to provide any  personalized  investment  advice in connection  with these programs and you should not rely on these programs
as providing  individualized  investment  recommendations  to you. The asset allocation  programs do not guarantee better investment
results.  We reserve the right to  terminate  or change the asset  allocation  programs at any time.  You should  consult  with your
investment professional before electing any asset allocation program.

DO YOU OFFER A PROGRAM DESIGNED TO GUARANTEE A "RETURN OF PREMIUM" AT A FUTURE DATE?
Yes.  We offer a program  for  investors  who wish to invest in the  variable  investment  options  but also wish to  protect  their
principal,  at least as of a  specific  date in the  future.  You may not want to use this  program  if you  expect to begin  taking
annuity  payments  before the program would be completed.  See Living Benefit  Progams  section of this Prospectus for a description
of the Guaranteed Return Option Plus optional benefit, which also offers protection of principal.

Balanced Investment Program
We offer a balanced  investment  program where a portion of your Account Value is allocated to a Fixed  Allocation and the remaining
Account  Value is  allocated  to the  variable  investment  options  that you  select.  When you enroll in the  Balanced  Investment
Program,  you choose the duration that you wish the program to last.  This  determines the duration of the Guarantee  Period for the
Fixed  Allocation.  Based on the fixed rate for the  Guarantee  Period  chosen,  we calculate the portion of your Account Value that
must be allocated to the Fixed  Allocation to grow to a specific  "principal  amount" (such as your initial  Purchase  Payment).  We
determine  the amount based on the rates then in effect for the Guarantee  Period you choose.  If you continue the program until the
end of the Guarantee  Period and make no withdrawals or transfers,  at the end of the Guarantee  Period,  the Fixed  Allocation will
have grown to equal the  "principal  amount".  Withdrawals or transfers  from the Fixed  Allocation  before the end of the Guarantee
Period will  terminate the program and may be subject to a Market Value  Adjustment.  You can transfer the Account Value that is not
allocated to the Fixed  Allocation  between any of the Sub-accounts  available under the Annuity.  Account Value you allocate to the
variable  investment options is subject to market  fluctuations and may increase or decrease in value. We do not deduct a charge for
participating in the Balanced Investment Program.



         Example
         Assume  you invest  $100,000.  You  choose a 10-year  program  and  allocate  a portion  of your  Account  Value to a Fixed
         Allocation  with a 10-year  Guarantee  Period.  The rate for the  10-year  Guarantee  Period is 5.33%*.  Based on the fixed
         interest rate for the Guarantee  Period chosen,  the factor is 0.594948 for determining how much of your Account Value will
         be  allocated  to the Fixed  Allocation.  That  means  that  $59,495  will be  allocated  to the Fixed  Allocation  and the
         remaining  Account Value  ($41,505)  will be allocated to the variable  investment  options.  Assuming that you do not make
         any  withdrawals  from the Fixed  Allocation,  it will grow to $100,000 at the end of the  Guarantee  Period.  Of course we
         cannot predict the value of the remaining Account Value that was allocated to the variable investment options.

*        The rate in this example is hypothetical and may not reflect the current rate for Guarantee Periods of this duration.

MAY I AUTHORIZE MY INVESTMENT PROFESSIONAL TO MANAGE MY ACCOUNT?
Yes. You may  authorize  your  investment  professional  to direct the  allocation  of your Account  Value and to request  financial
transactions  between  investment  options while you are living,  subject to our rules.  You must contact us immediately if and when
you revoke such authority.  We will not be responsible for acting on instructions  from your investment  professional if you fail to
inform us that such  person's  authority has been revoked.  We may also  suspend,  cancel or limit these  privileges at any time. We
will notify you if we do.

We or an affiliate of ours may provide  administrative  support to  licensed,  registered  investment  professionals  or  investment
advisors who you authorize to make financial  transactions on your behalf.  These investment  professionals  may be firms or persons
who also are  appointed by us as  authorized  sellers of the  Annuity.  However,  we do not offer advice about how to allocate  your
Account Value under any  circumstance.  Any investment  professionals  you engage to provide advice and/or make transfers for you is
not acting on our behalf. We are not responsible for any  recommendations  such investment  professionals make, any market timing or
asset allocation programs they choose to follow or any specific transfers they make on your behalf.

We may require  investment  professionals or investment  advisors,  who are authorized by multiple contract owners to make financial
transactions,  to enter into an administrative  agreement with American Skandia as a condition of our accepting transactions on your
behalf. The  administrative  agreement may impose  limitations on the investment  professional's or investment  advisor's ability to
request financial  transactions on your behalf.  These limitations are intended to minimize the detrimental  impact of an investment
professional  who is in a position to transfer  large  amounts of money for multiple  clients in a  particular  Portfolio or type of
portfolio  or  to  comply  with  specific   restrictions  or  limitations  imposed  by  a  Portfolio(s)  of  American  Skandia.  The
administrative agreement may limit the available investment options,  require advance notice of large transactions,  or impose other
trading limitations on your investment  professional.  Your investment  professional will be informed of all such restrictions on an
ongoing  basis.  We may also require that your  investment  professional  transmit all financial  transactions  using the electronic
trading functionality  available through our Internet website  (www.americanskandia.prudential.com).  Limitations that we may impose
on your investment  professional  or investment  advisor under the terms of the  administrative  agreement do not apply to financial
transactions requested by an Owner on their own behalf, except as otherwise described in this Prospectus.

HOW DO THE FIXED INVESTMENT OPTIONS WORK?

We credit the fixed  interest  rate to the Fixed  Allocation  throughout  a set period of time called a  "Guarantee  Period."  Fixed
Allocations  currently are offered with Guarantee Periods from 1 to 10 years. We may make Fixed  Allocations of different  durations
available in the future including Fixed Allocations  offered exclusively for use with certain optional  investment  programs.  Fixed
Allocations  may not be  available  in all states and may not always be  available  for all  Guarantee  Periods  depending on market
factors and other considerations.

The interest rate credited to a Fixed  Allocation is the rate in effect when the Guarantee  Period begins and does not change during
the  Guarantee  Period.  The rates are an  effective  annual rate of  interest.  We  determine  the  interest  rates for the various
Guarantee  Periods.  At the time that we confirm your Fixed  Allocation,  we will advise you of the interest  rate in effect and the
date your Fixed  Allocation  matures.  We may change the rates we credit new Fixed  Allocations  at any time. Any change in interest
rate does not affect Fixed  Allocations  that were in effect  before the date of the change.  To inquire as to the current rates for
Fixed Allocations, please call 1-800-766-4530.

A Guarantee Period for a Fixed Allocation begins:
|X|      when all or part of a net Purchase Payment is allocated to that particular Guarantee Period;
|X|      upon transfer of any of your Account Value to a Fixed Allocation for that particular Guarantee Period; or
|X|      when you "renew" a Fixed Allocation by electing a new Guarantee Period.



To the extent permitted by law, we may establish  different  interest rates for Fixed  Allocations  offered to a class of Owners who
choose to participate in various optional  investment  programs we make available.  This may include,  but is not limited to, Owners
who elect to use Fixed  Allocations  under a dollar cost averaging program (see "Do You Offer Dollar Cost Averaging?") or a balanced
investment  program (see "Do you offer programs  designed to guarantee a "Return of Premium" at a future date?").  The interest rate
credited to Fixed  Allocations  offered to this class of  purchasers  may be different  than those offered to other  purchasers  who
choose the same Guarantee  Period but who do not  participate  in an optional  investment  program.  Any such program is at our sole
discretion.

HOW DO YOU DETERMINE RATES FOR FIXED ALLOCATIONS?
We do not have a specific  formula for determining the fixed interest rates for Fixed  Allocations.  Generally the interest rates we
offer for Fixed  Allocations will reflect the investment  returns available on the types of investments we make to support our fixed
rate  guarantees.  These  investment  types may include cash,  debt  securities  guaranteed by the United States  government and its
agencies and  instrumentalities,  money market instruments,  corporate debt obligations of different durations,  private placements,
asset-backed  obligations  and municipal  bonds. In determining  rates we also consider  factors such as the length of the Guarantee
Period for the Fixed  Allocation,  regulatory  and tax  requirements,  liquidity of the markets for the type of investments we make,
commissions,  administrative and investment  expenses,  our insurance risks in relation to the Fixed  Allocations,  general economic
trends and competition.  Some of these  considerations  are similar to those we consider in determining the Insurance Charge that we
deduct from Account Value allocated to the Sub-accounts.

We will credit interest on a new Fixed  Allocation in an existing  Annuity at a rate not less than the rate we are then crediting to
Fixed Allocations for the same Guarantee Period selected by new Annuity purchasers in the same class.

The  interest  rate we credit  for a Fixed  Allocation  is  subject  to a  minimum.  Please  refer to the  Statement  of  Additional
Information.  In certain states the interest rate may be subject to a minimum under state law or regulation.

HOW DOES THE MARKET VALUE ADJUSTMENT WORK?

If you transfer or withdraw  Account  Value from a Fixed  Allocation  more than 30 days before the end of its Guarantee  Period,  we
will  adjust the value of your  investment  based on a  formula,  called a "Market  Value  Adjustment"  or "MVA".  The amount of any
Market Value  Adjustment  can be either  positive or negative,  depending on the movement of a combination of Strip Yields on Strips
and an  Option-adjusted  Spread (each as defined  below)  between the time that you purchase the Fixed  Allocation  and the time you
make a transfer or  withdrawal.  The Market Value  Adjustment  formula  compares the  combination of Strip Yields for Strips and the
Option-adjusted  Spreads  as of the date the  Guarantee  Period  began  with the  combination  of Strip  Yields  for  Strips and the
Option-adjusted  Spreads as of the date the MVA is being  calculated.  In certain  states the amount of any Market Value  Adjustment
may be limited under state law or  regulation.  If your Annuity is governed by the laws of that state,  any Market Value  Adjustment
that applies will be subject to our rules for complying with such law or regulation.

|X|      "Strips"  are a form of  security  where  ownership  of the  interest  portion of United  States  Treasury  securities  are
     separated from ownership of the underlying principal amount or corpus.
|X|      "Strip Yields" are the yields payable on coupon Strips of United States Treasury securities.
|X|      "Option-adjusted  Spread" is the difference between the yields on corporate debt securities  (adjusted to disregard options
     on such  securities)  and government debt  securities of comparable  duration.  We currently use the Merrill Lynch 1 to 10 year
     Investment Grade Corporate Bond Index of Option-adjusted Spreads.

MVA Formula
The MVA formula is applied  separately  to each Fixed  Allocation  to  determine  the  Account  Value of the Fixed  Allocation  on a
particular date.  The formula is as follows:

                                                    [(1+I) / (1+J+0.0010)]N/365
                                                               where:

                  I is the Strip Yield as of the start date of the Guarantee  Period for coupon Strips  maturing at
                  the end of the  applicable  Guarantee  Period plus the  Option-adjusted  Spread.  If there are no
                  Strips  maturing  at that time,  we will use the Strip  Yield for the Strips  maturing as soon as
                  possible after the Guarantee Period ends.



                  J is the Strip Yield as of the date the MVA formula is being applied for coupon  Strips  maturing
                  at the end of the applicable  Guarantee Period plus the  Option-adjusted  Spread. If there are no
                  Strips  maturing  at that time,  we will use the Strip  Yield for the Strips  maturing as soon as
                  possible after the Guarantee Period ends.

                  N is the number of days remaining in the original Guarantee Period.

If you surrender your Annuity under the right to cancel provision, the MVA formula is [(1 + I)/(1 + J)]N/365.

MVA Examples
The following hypothetical examples show the effect of the MVA in determining Account Value.  Assume the following:
|X|      On December 31, 2000, you allocate  $50,000 into a Fixed  Allocation with a Guarantee  Period of 5 years (e.g. the Maturity
         Date is December 31, 2005).
|X|      The  Strip  Yields  for  coupon  Strips  beginning  on  December  31,  2000 and  maturing  on  December  31,  2005 plus the
         Option-adjusted Spread is 5.50% (I = 5.50%).
|X|      You make no  withdrawals  or transfers  until you decided to withdraw the entire Fixed  Allocation  after exactly three (3)
         years, therefore 730 days remain before the Maturity Date (N = 730).

Example of Positive MVA
Assume  that at the time you  request  the  withdrawal,  the  Strip  Yields  for  Strips  maturing  on  December  31,  2005 plus the
Option-adjusted Spread is 4.00%  (J = 4.00%).  Based on these assumptions, the MVA would be calculated as follows:

                                 MVA Factor = [(1+I)/(1+J+0.0010)]N/365 = [1.055/1.041]2 = 1.027078
                                                     Interim Value = $57,881.25
                                 Account Value after MVA = Interim Value X MVA Factor = $59,448.56

Example of Negative MVA
Assume  that at the time you  request  the  withdrawal,  the  Strip  Yields  for  Strips  maturing  on  December  31,  2005 plus the
Option-adjusted Spread is 7.00% (J = 7.00%).  Based on these assumptions, the MVA would be calculated as follows:

                                MVA Factor = [(1+I)/(1+J+0.0010)]N/365 = [1.055/1.071)]2 = 0.970345
                                                     Interim Value = $57,881.25
                                 Account Value after MVA = Interim Value X MVA Factor = $56,164.78.

WHAT HAPPENS WHEN MY GUARANTEE PERIOD MATURES?
The "Maturity  Date" for a Fixed  Allocation is the last day of the Guarantee  Period.  Before the Maturity  Date, you may choose to
renew the Fixed  Allocation  for a new  Guarantee  Period of the same or  different  length or you may  transfer all or part of that
Fixed Allocation's  Account Value to another Fixed Allocation or to one or more  Sub-accounts.  We will notify you before the end of
the  Guarantee  Period  about the fixed  interest  rates that we are  currently  crediting to all Fixed  Allocations  that are being
offered.  The rates  being  credited to Fixed  Allocations  may change  before the  Maturity  Date.  We will not charge a MVA if you
choose to renew a Fixed Allocation on its Maturity Date or transfer the Account Value to one or more variable investment options.

If you do not specify how you want a Fixed  Allocation  to be  allocated  on its Maturity  Date,  we will then  transfer the Account
Value of the Fixed  Allocation to the AST Money Market  Sub-account.  You can then elect to allocate the Account Value to any of the
Sub-accounts or to a new Fixed Allocation.

ACCESS TO ACCOUNT VALUE

WHAT TYPES OF DISTRIBUTIONS ARE AVAILABLE TO ME?
During the accumulation  period you can access your Account Value through Partial  Withdrawals,  Systematic  Withdrawals,  and where
required for tax  purposes,  Minimum  Distributions.  You can also  surrender  your Annuity at any time.  We may deduct a portion of
the Account Value being  withdrawn or  surrendered  as a CDSC.  The CDSC will be assessed on the amount of Purchase  Payments  being
withdrawn,  not on the Account Value at the time of the withdrawal or surrender.  If you surrender your Annuity,  in addition to any
CDSC, we may deduct the Annual  Maintenance Fee, any Tax Charge that applies and the charge for any optional  benefits.  We may also
apply a Market Value  Adjustment to any Fixed  Allocations.  Certain  amounts may be available to you each Annuity Year that are not
subject to a CDSC.  These are called  "Free  Withdrawals."  In  addition,  under  certain  circumstances,  we may waive the CDSC for
surrenders made for qualified  medical reasons or for withdrawals  made to satisfy  Minimum  Distribution  requirements.  Unless you
notify us differently,  withdrawals  are taken pro-rata based on the Account Value in the investment  options at the time we receive
your withdrawal request.  Each of these types of distributions is described more fully below.

ARE THERE TAX IMPLICATIONS FOR DISTRIBUTIONS?
(For more information, see "Tax Considerations")

During the Accumulation Period
A  distribution  during the  accumulation  period is deemed to come first from any "gain" in your  Annuity and second as a return of
your "tax basis",  if any.  Distributions  from your Annuity are generally  subject to ordinary income taxation on the amount of any
investment gain unless the distribution  qualifies as a non-taxable  exchange or transfer.  If you take a distribution  prior to the
taxpayer's  age 59 1/2, you may be subject to a 10% penalty in addition to ordinary  income taxes on any gain.  You may wish to consult
a professional tax advisor for advice before requesting a distribution.

During the Annuitization Period
During the  annuitization  period,  a portion of each annuity payment is taxed as ordinary income at the tax rate you are subject to
at the time of the  payment.  The Code and  regulations  have  "exclusionary  rules" that we use to  determine  what portion of each
annuity  payment  should be  treated as a return of any tax basis you have in the  Annuity.  Once the tax basis in the  Annuity  has
been distributed,  the remaining  annuity payments are taxable as ordinary income.  The tax basis in the Annuity may be based on the
tax-basis from a prior contract in the case of a 1035 exchange or other qualifying transfer.

CAN I WITHDRAW A PORTION OF MY ANNUITY?
Yes, you can make a withdrawal during the accumulation period.

|X|      To meet  liquidity  needs,  you can withdraw a limited amount from your Annuity during each of Annuity Years 1-10 without a
         CDSC  being  applied.  We call this the "Free  Withdrawal"  amount.  The Free  Withdrawal  amount is not  available  if you
         choose to surrender your Annuity.  Amounts  withdrawn as a Free  Withdrawal do not reduce the amount of CDSC that may apply
         upon a subsequent withdrawal or surrender of the Annuity.  The minimum Free Withdrawal you may request is $100.

|X|      You can also make  withdrawals in excess of the Free Withdrawal  amount.  We call this a "Partial  Withdrawal."  The amount
         that you may withdraw  will depend on the Annuity's  Surrender  Value.  The Surrender  Value is equal to your Account Value
         minus any CDSC,  the Annual  Maintenance  Fee,  the Tax Charge,  any charges for  optional  benefits  and any Market  Value
         Adjustment  that may apply to any Fixed  Allocations.  After any Partial  Withdrawal,  your  Annuity  must have a Surrender
         Value of at least $1,000,  or we may treat the Partial  Withdrawal  request as a request to fully  surrender  your Annuity.
         The minimum Partial Withdrawal you may request is $100.

When we determine if a CDSC applies to Partial  Withdrawals  and  Systematic  Withdrawals,  we will first  determine  what,  if any,
amounts  qualify as a Free  Withdrawal.  Those amounts are not subject to the CDSC.  Partial  Withdrawals or Systematic  Withdrawals
of amounts greater than the maximum Free Withdrawal amount will be subject to a CDSC.

You may request a withdrawal  for an exact dollar amount after  deduction of any CDSC that applies  (called a "net  withdrawal")  or
request a gross  withdrawal  from which we will deduct any CDSC that applies,  resulting in less money being payable to you than the
amount you  requested.  If you request a net  withdrawal,  the amount  deducted  from your Account Value to pay the CDSC may also be
subject to a CDSC.

Partial Withdrawals may also be available following annuitization but only if you choose certain annuity payment options.

To request the forms  necessary to make a withdrawal  from your  Annuity,  contact our Customer  Service Team at  1-800-680-8920  or
visit our Internet Website at www.americanskandia.prudential.com.

HOW MUCH CAN I WITHDRAW AS A FREE WITHDRAWAL?

Annuity Year 1-10
The maximum  Free  Withdrawal  amount  during  each of Annuity  Years 1 through 10 (when a CDSC would  otherwise  apply to a partial
withdrawal or surrender of your initial Purchase  Payment) is 10% of all Purchase  Payments.  We may apply a Market Value Adjustment
to any  Fixed  Allocations.  The 10% Free  Withdrawal  amount  is not  cumulative.  If you do not make a Free  Withdrawal  during an
Annuity  Year,  you are not  allowed to carry over the Free  Withdrawal  amount to the next  Annuity  Year.  Withdrawals  of amounts
greater  than the maximum  Free  Withdrawal  amount are treated as a  withdrawal  of Purchase  Payments  and will be assessed a CDSC
during Annuity Years 1 through 10.

NOTE:  Amounts that you have  withdrawn as a Free  Withdrawal  will not reduce the amount of any CDSC that we deduct if,  during the
first ten (10) Annuity Years, you make a partial  withdrawal or choose to surrender the Annuity.  If, during Annuity Years 1 through
10, all Purchase  Payments  withdrawn are subject to a CDSC, then any subsequent  withdrawals will be withdrawn from any gain in the
Annuity, which may include Credits.

Annuity Year 11+
After Annuity Year 10, you can surrender  your Annuity or make a partial  withdrawal  without a CDSC being  deducted from the amount
being withdrawn.

Examples
1.       Assume you make an initial  Purchase  Payment of  $10,000  and make no  additional  Purchase  Payments.  The  maximum  Free
     Withdrawal amount during each of the first ten Annuity Years would be 10% of $10,000, or $1,000.

2.       Assume you make an initial  Purchase  Payment of $10,000 and make an additional  Purchase Payment of $5,000 in Annuity Year
     2. The maximum Free Withdrawal  amount during Annuity Year 3 through 10 would be 10% of $15,000,  or $1,500.  From Annuity Year
     11 and thereafter,  you can surrender your Annuity or make a partial  withdrawal  without a CDSC being deducted from the amount
     being withdrawn.

3.       Assume you make an initial  Purchase  Payment of $10,000 and take a Free Withdrawal of $500 in Annuity Year 2 and $1,000 in
     Annuity  Year 3. If you  surrender  your  Annuity in Annuity  Year 5, the CDSC will be assessed  against  the initial  Purchase
     Payment  amount  ($10,000),  not the amount of Purchase  Payments  reduced by the amounts  that were  withdrawn  under the Free
     Withdrawal provision.

IS THERE A CHARGE FOR A PARTIAL WITHDRAWAL?
A CDSC may be  assessed  against a Partial  Withdrawal  during the first ten (10)  Annuity  Years.  Whether a CDSC  applies  and the
amount to be charged depends on whether the Partial  Withdrawal  exceeds any Free Withdrawal  amount and, if so, the number of years
that have elapsed since the Issue Date of the Annuity.

1.       If you request a Partial  Withdrawal,  we determine if the amount you requested is available as a Free Withdrawal (in which
     case it would not be subject to a CDSC);
2.       If the amount  requested  exceeds the available Free  Withdrawal  amount,  we determine if a CDSC will apply to the Partial
     Withdrawal  based on the  number of years that have  elapsed  since the  Annuity  was  issued.  Any CDSC will only apply to the
     amount  withdrawn that exceeds the Free Withdrawal  amount.  The maximum Free Withdrawal  amount during each of Annuity Years 1
     through 10 is 10% of all  Purchase  Payments.  Withdrawals  of amounts  greater  than the maximum  Free  Withdrawal  amount are
     treated as a withdrawal of Purchase  Payments and will be assessed a CDSC.  If, during Annuity Years 1 through 10, all Purchase
     Payments are withdrawn  subject to a CDSC,  then any  subsequent  withdrawals  will be withdrawn  from any gain in the Annuity,
     which may include Credits.

     For purposes of calculating the CDSC on a partial  withdrawal,  the Purchase  Payments being withdrawn may be greater than your
     remaining  Account  Value or the  amount of your  withdrawal  request.  This is most  likely  to occur if you have  made  prior
     withdrawals  under the Free  Withdrawal  provision  or if your  Account  Value has  declined  in value due to  negative  market
     performance.

3.       If the amount  requested  exceeds the amounts  available  under Item #2 above,  we withdraw the  remaining  amount from any
     other Account Value (including Account Value due to Credits).

|X|      If the Annuity has been in effect for less than ten  complete  years,  a CDSC will be charged on the amount of the Purchase
         Payment being withdrawn, according to the CDSC table.
|X|      If the Annuity has been in effect for more than ten complete years, no CDSC will be charged on the amount being withdrawn.

CAN I MAKE PERIODIC WITHDRAWALS FROM THE ANNUITY DURING THE ACCUMULATION PERIOD?
Yes. We call these "Systematic  Withdrawals." You can receive  Systematic  Withdrawals of earnings only,  principal plus earnings or
a flat dollar  amount.  Systematic  Withdrawals  may be subject to a CDSC. We will  determine  whether a CDSC applies and the amount
in the same way as we would for a Partial Withdrawal.



Systematic  Withdrawals  can be made  from  Account  Value  allocated  to the  variable  investment  options  or Fixed  Allocations.
Generally,  Systematic  Withdrawals  from Fixed  Allocations  are  limited  to  earnings  accrued  after the  program of  Systematic
Withdrawals  begins, or payments of fixed dollar amounts that do not exceed such earnings.  Systematic  Withdrawals are available on
a monthly,  quarterly,  semi-annual  or annual basis.  The Surrender  Value of your Annuity must be at least $20,000  before we will
allow you to begin a program of Systematic Withdrawals.

The minimum  amount for each  Systematic  Withdrawal is $100. If any scheduled  Systematic  Withdrawal is for less than $100, we may
postpone  the  withdrawal  and add the  expected  amount to the amount  that is to be  withdrawn  on the next  scheduled  Systematic
Withdrawal.

DO YOU OFFER A PROGRAM FOR WITHDRAWALS UNDER SECTION 72(t) OF THE INTERNAL REVENUE CODE?
Yes. If your Annuity is used as a funding  vehicle for certain  retirement  plans that receive  special tax treatment under Sections
401,  403(b) or 408 of the Code,  Section  72(t) of the Code may provide an exception to the 10% penalty tax on  distributions  made
prior to age 59 1/2if you elect to  receive  distributions  as a series of  "substantially  equal  periodic  payments".  Distributions
received under this provision in any Annuity Year that exceed the maximum amount  available as a free  withdrawal will be subject to
a CDSC. We may apply a Market Value  Adjustment  to any Fixed  Allocations.  To request a program that complies with Section  72(t),
you must provide us with certain  required  information  in writing on a form  acceptable  to us. We may require  advance  notice to
allow us to calculate  the amount of 72(t)  withdrawals.  The  Surrender  Value of your Annuity must be at least  $20,000  before we
will allow you to begin a program for withdrawals under Section 72(t).  The minimum amount for any such withdrawal is $100.

You may also annuitize  your contract and begin  receiving  payments for the remainder of your life (or life  expectancy) as a means
of receiving income payments before age 59 1/2that are not subject to the 10% penalty.

WHAT ARE MINIMUM DISTRIBUTIONS AND WHEN WOULD I NEED TO MAKE THEM?
(See "Tax Considerations" for a further discussion of Minimum Distributions.)

Minimum Distributions are a type of Systematic  Withdrawal we allow to meet distribution  requirements under Sections 401, 403(b) or
408 of the Code.  Under the Code,  you may be required to begin  receiving  periodic  amounts from your  Annuity.  In such case,  we
will allow you to make  Systematic  Withdrawals  in amounts that satisfy the minimum  distribution  rules under the Code.  We do not
assess a CDSC on Minimum  Distributions  from your Annuity if you are required by law to take such Minimum  Distributions  from your
Annuity at the time it is taken.  However,  a CDSC may be  assessed  on that  portion of a  Systematic  Withdrawal  that is taken to
satisfy the minimum  distribution  requirements in relation to other savings or investment  plans under other  qualified  retirement
plans not maintained with American Skandia.

The  amount of the  required  Minimum  Distribution  for your  particular  situation  may  depend  on other  annuities,  savings  or
investments.  We will only  calculate  the amount of your  required  Minimum  Distribution  based on the value of your  Annuity.  We
require three (3) days advance  written notice to calculate and process the amount of your  payments.  You may elect to have Minimum
Distributions  paid out monthly,  quarterly,  semi-annually  or annually.  The $100 minimum that applies to  Systematic  Withdrawals
does not apply to Minimum Distributions.

You may also annuitize  your contract and begin  receiving  payments for the remainder of your life (or life  expectancy) as a means
of receiving income payments and satisfying the Minimum Distribution requirements under the Code.

CAN I SURRENDER MY ANNUITY FOR ITS VALUE?
Yes.  During the  accumulation  period you can surrender your Annuity at any time.  Upon  surrender,  you will receive the Surrender
Value.  Upon surrender of your Annuity, you will no longer have any rights under the Annuity.

For purposes of  calculating  the CDSC on  surrender,  the Purchase  Payments  being  withdrawn  may be greater than your  remaining
Account Value or the amount of your withdrawal  request.  This is most likely to occur if you have made prior  withdrawals under the
Free  Withdrawal  provision  or if your  Account  Value has  declined in value due to negative  market  performance.  We may apply a
Market Value Adjustment to any Fixed Allocations.

Under certain annuity payment options, you may be allowed to surrender your Annuity for its then current value.

To request the forms  necessary  to  surrender  your  Annuity,  contact our Customer  Service  Team at  1-800-680-8920  or visit our
Internet Website at www.americanskandia.prudential.com.

WHAT IS A MEDICALLY-RELATED SURRENDER AND HOW DO I QUALIFY?
Where  permitted by law, you may request to surrender  your Annuity prior to the Annuity Date without  application  of any CDSC upon
occurrence  of a  medically-related  "Contingency  Event".  We may apply a Market Value  Adjustment  to any Fixed  Allocations.  The
amount  payable  will be your  Account  Value  minus:  (a) the  amount of any  Credits  applied  within 12 months of the  applicable
"Contingency  Event" as defined below;  and (b) the amount of any Credits added in conjunction with any Purchase  Payments  received
after our receipt of your request for a  medically-related  surrender (i.e.  Purchase  Payments  received at such time pursuant to a
salary reduction program.

This waiver of any applicable CDSC is subject to our rules, including but not limited to the following:
|X|      the Annuitant must be named or any change of Annuitant must be accepted by us, prior to the  "Contingency  Event" described
     below;
|X|      the Annuitant must be alive as of the date we pay the proceeds of such surrender request;
|X|      if the Owner is one or more natural persons, all such Owners must also be alive at such time;
|X|      we must receive  satisfactory  proof of the Annuitant's  confinement in a Medical Care Facility or Fatal Illness in writing
     on a form satisfactory to us; and
|X|      this benefit is not available if the total Purchase  Payments  received exceed $500,000 for all annuities issued by us with
     this benefit where the same person is named as Annuitant.

A "Contingency Event" occurs if the Annuitant is:
|X|      first confined in a "Medical Care Facility"  while your Annuity is in force and remains  confined for at least 90 days in a
       row; or
|X|      first diagnosed as having a "Fatal Illness" while your Annuity is in force.

The definitions of "Medical Care Facility" and "Fatal  Illness," as well as additional  terms and  conditions,  are provided in your
Annuity.  Specific details and definitions in relation to this benefit may differ in certain jurisdictions.

WHAT TYPES OF ANNUITY OPTIONS ARE AVAILABLE?
We currently make annuity options available that provide fixed annuity payments,  variable  payments or adjustable  payments.  Fixed
options  provide the same amount with each  payment.  Variable  options  generally  provide a payment which may increase or decrease
depending on the investment  performance of the Sub-accounts.  However,  currently,  we also make a variable payment option that has
a guarantee  feature.  Adjustable  options  provide a fixed payment that is periodically  adjusted based on current  interest rates.
We do not guarantee to make any annuity  payment  options  available in the future.  For additional  information on annuity  payment
options you may request a Statement of Additional Information.

When you purchase an Annuity,  or at a later date,  you may choose an Annuity Date,  an annuity  option and the frequency of annuity
payments.  You may not choose an Annuity  Date that occurs in the first three  Annuity  Years.  You may change your  choices  before
the Annuity  Date under the terms of your  contract.  A maximum  Annuity Date may be required by law. The Annuity Date may depend on
the annuity option you choose.  Certain  annuity  options may not be available  depending on the age of the  Annuitant.  You may not
annuitize and receive annuity payments within the first three Annuity Years.

Certain of these annuity options may be available to  Beneficiaries  who choose to receive the Death Benefit proceeds as a series of
payments instead of a lump sum payment.
Option 1
- --------
Payments for Life:  Under this option,  income is payable  periodically  until the death of the "key life".  The "key life" (as used
in this  section) is the person or persons  upon whose life annuity  payments are based.  No  additional  annuity  payments are made
after the death of the key life.  Since no minimum  number of  payments is  guaranteed,  this  option  offers the largest  amount of
periodic  payments of the life  contingent  annuity  options.  It is possible  that only one payment will be payable if the death of
the key life occurs before the date the second  payment was due, and no other  payments nor death  benefits  would be payable.  This
Option is currently  available on a fixed or variable basis.  Under this option,  you cannot make a partial or full surrender of the
annuity.

Option 2
- --------
Payments Based on Joint Lives:  Under this option,  income is payable  periodically  during the joint lifetime of two key lives, and
thereafter  during the remaining  lifetime of the survivor,  ceasing with the last payment prior to the survivor's death. No minimum
number of payments is  guaranteed  under this option.  It is possible  that only one payment will be payable if the death of all the
key lives  occurs  before the date the second  payment was due,  and no other  payments  or death  benefits  would be payable.  This
Option is currently  available on a fixed or variable basis.  Under this option,  you cannot make a partial or full surrender of the
annuity.



Option 3
- --------
Payments for Life with a Certain  Period:  Under this option,  income is payable  until the death of the key life.  However,  if the
key life dies before the end of the period selected (5, 10 or 15 years),  the remaining  payments are paid to the Beneficiary  until
the end of such period.  This Option is  currently  available on a fixed or variable  basis.  If you elect to receive  payments on a
variable basis under this option,  you can request  partial or full surrender of the annuity and receive its then current cash value
(if any) subject to our rules.

Option 4
- --------
Fixed Payments for a Certain  Period:  Under this option,  income is payable  periodically  for a specified  number of years. If the
payee dies before the end of the specified  number of years,  the remaining  payments are paid to the  Beneficiary  until the end of
such period.  Note that under this option,  payments are not based on any assumptions of life  expectancy.  Therefore,  that portion
of the  Insurance  Charge  assessed  to cover the risk that key lives  outlive  our  expectations  provides  no  benefit to an Owner
selecting this option.  Under this option, you cannot make a partial or full surrender of the annuity.

Option 5
- --------
Variable  Payments for Life with a Cash Value:  Under this  option,  benefits  are payable  periodically  until the death of the key
life.  Benefits may  increase or decrease  depending  on the  investment  performance  of the  Sub-accounts.  This option has a cash
value that also varies with the  investment  performance  of the  Sub-account.  The cash value  provides a "cushion"  from  volatile
investment  performance so that negative investment  performance does not automatically  result in a decrease in the annuity payment
each month,  and positive  investment  performance does not  automatically  result in an increase in the annuity payment each month.
The cushion generally  "stabilizes"  monthly annuity payments.  Any cash value remaining on the death of the key life is paid to the
Beneficiary  in a lump sum or as periodic  payments.  Under this option,  you can request  partial or full  surrender of the annuity
and receive its then current cash value (if any) subject to our rules.

Option 6
- --------
Variable  Payments  for Life with a Cash Value and  Guarantee:  Under this  option,  benefits  are payable as described in Option 5;
except that,  while the key life is alive, the annuity payment will not be less than a guaranteed  amount,  which generally is equal
- ------
to the first annuity  payment.  We charge an additional  amount for this guarantee.  Under this option,  any cash value remaining on
the death of the key life is paid to the  Beneficiary  in a lump sum or as periodic  payments.  Under this  option,  you can request
partial or full surrender of the annuity and receive its then current cash value (if any) subject to our rules.

We may make additional annuity payment options available in the future.

HOW AND WHEN DO I CHOOSE THE ANNUITY PAYMENT OPTION?
Unless  prohibited  by law, we require that you elect either a life annuity or an annuity with a certain  period of at least 5 years
if any CDSC would apply were you to  surrender  your  Annuity on the Annuity  Date.  Therefore,  choosing an Annuity Date within ten
(10) years of the Issue Date of the Annuity may limit the available  annuity  payment  options.  Certain annuity payment options may
not be available if your Annuity Date occurs during the period that a CDSC would apply.

If you have not provided us with your Annuity Date or annuity payment option in writing, then:
|X|      the Annuity Date will be the first day of the calendar month  following the later of the  Annuitant's  85th birthday or the
         fifth anniversary of our receipt of your request to purchase an Annuity; and
|X|      the annuity  payments,  where allowed by law, will be calculated on a fixed basis under Option 3, Payments for Life with 10
         years certain.

HOW ARE ANNUITY PAYMENTS CALCULATED?

Fixed Annuity Payments (Options 1-4)
If you choose to receive fixed annuity  payments,  you will receive equal  fixed-dollar  payments  throughout the period you select.
The amount of the fixed payment will vary  depending on the annuity  payment  option and payment  frequency  you select.  Generally,
the first annuity  payment is determined by  multiplying  the Account  Value,  minus any state premium taxes that may apply,  by the
factor  determined  from our table of annuity rates.  The table of annuity rates differs based on the type of annuity chosen and the
frequency of payment  selected.  Our rates will not be less than our guaranteed  minimum rates.  These guaranteed  minimum rates are
derived from the a2000 Individual  Annuity  Mortality Table with an assumed interest rate of 3% per annum.  Where required by law or
regulation,  such annuity  table will have rates that do not differ  according to the gender of the key life.  Otherwise,  the rates
will differ according to the gender of the key life.



Variable Annuity Payments
We offer three different  types of variable  annuity payment  options.  The first annuity payment will be calculated  based upon the
assumed  investment  return  ("AIR").  You select the AIR before we start to make  annuity  payments.  You will not receive  annuity
payments  until you choose an AIR. The remaining  annuity  payments will  fluctuate  based on the  performance  of the  Sub-accounts
relative to the AIR, as well as, other  factors  described  below.  The greater the AIR, the greater the first  annuity  payment.  A
higher  AIR may result in  smaller  potential  growth in the  annuity  payments.  A lower AIR  results  in a lower  initial  annuity
payment.  Within payment options 1-3, if the  Sub-accounts  you choose perform exactly the same as the AIR, then subsequent  annuity
payments  will be the same as the  first  annuity  payment.  If the  Sub-accounts  you  choose  perform  better  than the AIR,  then
subsequent  annuity  payments will be higher than the first annuity  payment.  If the Sub-accounts you choose perform worse than the
AIR,  then  subsequent  annuity  payments  will be lower  than the  first.  Within  payment  options 5 and 6, the cash value for the
Annuitant  (while alive) and a variable  period of time during which  annuity  payments will be made whether or not the Annuitant is
still alive are adjusted based on the performance of the Sub-accounts  relative to the AIR; however,  subsequent annuity payments do
not always increase or decrease based on the performance of the Sub-accounts relative to the AIR.

|X|      Variable Payments (Options 1-3)
         -----------------
         We calculate each annuity  payment amount by multiplying  the number of units  scheduled to be redeemed under a schedule of
         units for each  Sub-account by the Unit Value of each  Sub-account  on the annuity  payment date. We determine the schedule
         of units  based on your  Account  Value  (minus any  premium  tax that  applies)  at the time you elect to begin  receiving
         annuity  payments.  The  schedule  of units will vary  based on the  annuity  payment  option  selected,  the length of any
         certain  period  (if  applicable),  the  Annuitant's  age and  gender  (if  annuity  payments  are due for the  life of the
         Annuitant) and the Unit Value of the  Sub-accounts  you initially  selected on the Issue Date. The calculation is performed
         for each Sub-account,  and the sum of the Sub-account  calculations  equals the amount of your annuity payment.  Other than
         to fund annuity  payments,  the number of units allocated to each Sub-account will not change unless you transfer among the
         Sub-accounts or make a withdrawal (if allowed).  You can select one of three AIRs for these options: 3%, 5% or 7%.

|X|      Stabilized Variable Payments (Option 5)
         ----------------------------
         This option provides  guaranteed  payments for life, a cash value for the Annuitant  (while alive) and a variable period of
         time during which  annuity  payments  will be made whether or not the  Annuitant is still alive.  We calculate  the initial
                                                                                                                             -------
         annuity  payment amount by multiplying  the number of units  scheduled to be redeemed under a schedule of units by the Unit
         Values  determined on the  annuitization  date. The schedule of units is established for each Sub-account you choose on the
         annuitization date based on the applicable  benchmark rate,  meaning the AIR, and the annuity factors.  The annuity factors
         reflect our assumptions  regarding the costs we expect to bear in guaranteeing  payments for the lives of the Annuitant and
         will depend on the benchmark  rate, the annuitant's  attained age and gender (where  permitted).  Unlike variable  payments
         (described  above)  where each  payment  can vary based on  Sub-account  performance,  this  payment  option  cushions  the
         immediate  impact of  Sub-account  performance  by adjusting the length of the time during which  annuity  payments will be
         made whether or not the  Annuitant  is alive while  generally  maintaining  a level  annuity  payment  amount.  Sub-account
         performance that exceeds a benchmark rate will generally  extend this time period,  while  Sub-account  performance that is
         less than a benchmark  rate will  generally  shorten the period.  If the period  reaches  zero and the  Annuitant  is still
         alive,  Annuity  Payments  continue,  however,  the annuity payment amount will vary depending on Sub-account  performance,
         similar to conventional variable payments.  The AIR for this option is 4%.

|X|      Stabilized Variable Payments with a Guaranteed Minimum (Option 6)
         ------------------------------------------------------
         This option provides  guaranteed  payments for life in the same manner as Stabilized  Variable Payments  (described above).
         In addition to the  stabilization  feature,  this option also  guarantees that variable  annuity  payments will not be less
         than the initial annuity payment amount regardless of Sub-account performance.  The AIR for this option is 3%.

The variable  annuity payment options are described in greater detail in a separate  prospectus which will be provided to you at the
time you elect one of the variable annuity payment options.

Adjustable Annuity Payments
We may make an adjustable annuity payment option available.  Adjustable  annuity payments are calculated  similarly to fixed annuity
payments except that on every fifth (5th) anniversary of receiving  annuity payments,  the annuity payment amount is adjusted upward
or downward  depending on the rate we are currently  crediting to annuity  payments.  The  adjustment in the annuity  payment amount
does not affect the duration of remaining annuity payments, only the amount of each payment.



LIVING BENEFIT PROGRAMS

DO YOU OFFER PROGRAMS DESIGNED TO PROVIDE INVESTMENT PROTECTION FOR OWNERS WHILE THEY ARE ALIVE?

Yes. American Skandia offers three different optional benefits,  for an additional  charge,  that can provide investment  protection
for Owners while they are alive.  Each  optional  benefit  offers a distinct type of guarantee,  regardless  of the  performance  of
variable  investment  options,  that may be  appropriate  for you  depending  on the  manner in which you intend to make use of your
annuity while you are alive.  Depending on which  optional  benefit you choose,  you can have  substantial  flexibility to invest in
variable investment options while:
|X|      protecting a principal amount from decreases in value as of specified future dates;
|X|      taking withdrawals with a guarantee that you will be able to withdraw not less than a principal amount over time; or
|X|      guaranteeing  a minimum amount of growth will be applied to your  principal,  if it is to be used as the basis for lifetime
         income payments beginning after a waiting period.

Below is a brief summary of the three "living  benefits" that American Skandia offers.  Please refer to the benefit  description for
a complete  description of the terms,  conditions and limitations of each optional benefit.  You should consult with your investment
professional  to determine if any of these optional  benefits may be appropriate  for you based on your financial  needs.  There are
many factors to consider,  but we note that among them you may want to evaluate the tax  implications of these different  approaches
to meeting your needs,  both between these  benefits and in comparison to other  potential  solutions to your needs (e.g.  comparing
the tax implications of the withdrawal benefit and annuity payments).

I.       The Guaranteed Return Option PlusSM (GRO PlusSM)  guarantees that, after a seven-year period following  commencement of the
     program  ("maturity date") and on each anniversary of the maturity date thereafter,  the Owner's Account Value will not be less
     than the Account  Value on the effective  date of the program.  The program also offers the Owner the option to elect a second,
     enhanced  guarantee  amount at a higher Account Value subject to a separate  maturity period (and its  anniversaries).  The GRO
     PlusSM program may be appropriate if you wish to protect a principal  amount (called the "Protected  Principal  Value") against
     market downturns as of a specific date in the future, but also wish to exercise  substantial  control of the allocation of your
     Account Value amongst the variable  investment  options to participate in market increases.  Under the GRO PlusSM program,  you
     give us the right to allocate amounts to Fixed Allocations as needed to support the guarantees provided.

II.      The Guaranteed Minimum  Withdrawal  Benefit (GMWB) guarantees the Owner's ability to make cumulative  withdrawals over time
     equal to an initial principal value (called the "Protected  Withdrawal  Value"),  regardless of decreases in your Account Value
     due to market  losses.  The GMWB program may be appropriate  if you intend to make periodic  withdrawals  from your Annuity and
     wish to ensure that market  performance  will not affect your ability to protect your principal.  Taking income as withdrawals,
     rather than annuity  payments,  may be less tax efficient for non-qualified  uses of the Annuity,  but provides greater control
     over the timing and amount of withdrawals  during the accumulation  period, as well as continuing the Annuity's other benefits,
     such as the death benefit.

III.     The Guaranteed  Minimum Income Benefit (GMIB) guarantees the Owner's ability,  after a minimum  seven-year  waiting period,
     to begin  receiving  income from the Annuity in the form of annuity  payments  based on a guaranteed  minimum value (called the
     "Protected  Income Value") that increases  after the waiting period begins,  regardless of the impact of market  performance on
     your Account Value.  The GMIB program may be  appropriate  if you anticipate  using your Annuity as a future source of periodic
     fixed income  payments for the remainder of your life and wish to ensure that the basis upon which your income payments will be
     calculated will achieve at least a minimum amount of growth despite fluctuations in market performance.

The GRO PlusSM,  GMWB or GMIB programs may only be elected  individually,  and cannot be elected in combination with each other. Any
of the  living  benefits  can be  elected  with any of the  optional  death  benefits  we  currently  make  available.  We deduct an
additional  charge if you elect any of these optional benefits to compensate  American Skandia for the additional  insurance risk we
assume in providing the applicable guarantee under each optional benefit.



GUARANTEED RETURN OPTION PlusSM (GRO PlusSM)

- ------------------------------------------------------------------------------------------------------------------------------------
The  Guaranteed  Return Option Plus  described  below is being  offered in those  jurisdictions  where we have  received  regulatory
approval,  and will be offered  subsequently in other  jurisdictions  when we receive  regulatory  approval in those  jurisdictions.
Certain terms and  conditions may differ between  jurisdictions  once approved.  The program can be elected by new purchasers on the
Issue Date of their  Annuity,  and can be elected by existing  Annuity  Owners on either the  anniversary of the Issue Date of their
Annuity or on a date other than that  anniversary,  as  described  below under  "Election of the  Program".  The  Guaranteed  Return
Option Plus is not available if you elect the Guaranteed  Return Option rider, the Guaranteed  Minimum  Withdrawal  Benefit rider or
the Guaranteed Minimum Income Benefit rider.
- ------------------------------------------------------------------------------------------------------------------------------------

We offer a program that,  after a seven-year  period  following  commencement of the program (we refer to the end of that seven-year
period as the "maturity date") and on each  anniversary of the maturity date  thereafter,  guarantees your Account Value will not be
less than your Account  Value on the effective  date of your program  (called the  "Protected  Principal  Value").  The program also
offers you the  opportunity  to elect a second,  enhanced  guaranteed  amount at a later date if your Account  Value has  increased,
while preserving the guaranteed  amount  established on the effective date of your program.  The enhanced  guaranteed amount (called
the "Enhanced  Protected  Principal Value")  guarantees that, after a separate  seven-year period following election of the enhanced
guarantee and on each anniversary  thereafter,  your Account Value will not be less than your Account Value on the effective date of
your election of the enhanced guarantee.

The program  monitors your Account Value daily and, if necessary,  systematically  transfers  amounts  between  variable  investment
options you choose and Fixed  Allocations used to support the Protected  Principal  Value(s).  The program may be appropriate if you
wish to protect a principal  amount  against  market  downturns as of a specific date in the future,  but also wish to invest in the
variable  investment  options to participate in market  increases.  There is an additional charge if you elect the Guaranteed Return
Option Plus program.

The  guarantees  provided by the program  exist only on the  applicable  maturity  date(s) and on each  anniversary  of the maturity
date(s)  thereafter.  However,  due to the ongoing  monitoring  of your  Account  Value and the  transfer of Account  Value  between
variable  investment  options and Fixed Allocations to support our future  guarantees,  the program may provide some protection from
significant market losses if you choose to surrender the Annuity or begin receiving annuity payments prior to a maturity date.

KEY FEATURE - Protected Principal Value/Enhanced Protected Principal Value
The Guaranteed Return Option Plus offers a base guarantee as well as the option of electing an enhanced guarantee at a later date.
|X|      Base Guarantee:  Under the base guarantee,  American  Skandia  guarantees that on the maturity date and on each anniversary
     of the maturity date thereafter, your Account Value will be no less than the Protected Principal Value.
     On the maturity date and on each  anniversary  after the maturity date, if your Account Value is below the Protected  Principal
     Value,  American Skandia will apply additional  amounts to your Annuity from its general account to increase your Account Value
     to be equal to the Protected Principal Value.

|X|      Enhanced  Guarantee:  On any anniversary  following  commencement of the program,  you can establish an enhanced guaranteed
     amount based on your current Account Value.  Under the enhanced  guarantee,  American Skandia guarantees that at the end of the
     seven year period  following the election of the enhanced  guarantee  (also  referred to as its "maturity  date"),  and on each
     anniversary of the maturity date thereafter,  your Account Value will be no less than the Enhanced  Protected  Principal Value.
     You can elect an enhanced  guarantee  more than once;  however,  a  subsequent  election  supersedes  the prior  election of an
     enhanced  guarantee.  Election of an enhanced  guarantee  does not impact the base  guarantee.  In  addition,  you may elect an
     "auto step-up" feature that will automatically  increase your base guarantee (or enhanced guarantee,  if previously elected) on
     each  anniversary of the program (and create a new, seven year maturity  period for the new enhanced  guarantee) if the Account
     Value as of that  anniversary  exceeds the existing base  guarantee  (or enhanced  guarantee,  if previously  elected) by 7% or
     more.  You may also elect to  terminate an enhanced  guarantee.  If you elect to terminate  the  enhanced  guarantee,  the base
     guarantee will remain in effect.
     If you have elected the enhanced  guarantee,  on the  guarantee's  maturity date and on each  anniversary  of the maturity date
     thereafter,  if your Account Value is below the Enhanced  Protected  Principal  Value,  American  Skandia will apply additional
     amounts to your  Annuity  from its  general  account to  increase  your  Account  Value to be equal to the  Enhanced  Protected
     Principal Value.

Any  amounts  added to your  Annuity  will be applied,  if  necessary,  to any Fixed  Allocations  needed to support the  applicable
guarantee  amount as of the  maturity  date or any  anniversary  of the  maturity  date.  Any  remaining  amounts  will be allocated
pro-rata to your  Account  Value based on your  current  Sub-account  allocations.  We will notify you of any amounts  added to your
Annuity  under the  program.  The  Protected  Principal  Value is referred to as the "Base  Guarantee"  and the  Enhanced  Protected
Principal Value is referred to as the "Step-up Guarantee" in the rider we issue for this benefit.

Withdrawals under your Annuity
Withdrawals  from your  Annuity,  while the program is in effect,  will reduce the base  guarantee  under the program as well as any
enhanced  guarantee.  Cumulative  annual  withdrawals  up to 5% of the Protected  Principal  Value as of the  effective  date of the
program  (adjusted  for any  subsequent  Purchase  Payments  and any  Credits  applied to such  Purchase  Payments)  will reduce the
applicable  guaranteed amount by the actual amount of the withdrawal (referred to as the  "dollar-for-dollar  limit"). If the amount
withdrawn is greater than the dollar-for-dollar  limit, the portion of the withdrawal equal to the  dollar-for-dollar  limit will be
treated as  described  above,  and the  portion of the  withdrawal  in excess of the  dollar-for-dollar  limit will  reduce the base
guarantee and the enhanced  guarantee  proportionally,  according to the formula as described in the rider for this benefit (see the
examples  of this  calculation  below).  Withdrawals  will be taken  pro-rata  from the  variable  investment  options and any Fixed
Allocations.  Withdrawals  will be subject to all other  provisions of the Annuity,  including any Contingent  Deferred Sales Charge
or Market Value Adjustment that would apply.

Charges  for other  optional  benefits  under the  Annuity  that are  deducted  as an annual  charge in arrears  will not reduce the
applicable guaranteed amount under the Guaranteed Return Option Plus program.

The following examples of  dollar-for-dollar  and proportional  reductions assume that: 1.) the Issue Date and the effective date of
the GRO PlusSM program are October 13, 2003; 2.) an initial Purchase  Payment of $250,000;  3.) a base guarantee amount of $250,000;
and 4.) a dollar-for-dollar limit of $12,500 (5% of $250,000):

Example 1. Dollar-for-dollar reduction

A $10,000  withdrawal  is taken on November 29, 2003 (in the first  Annuity  Year).  No prior  withdrawals  have been taken.  As the
amount withdrawn is less than the Dollar-for-dollar Limit:
o        The base guarantee amount is reduced by the amount withdrawn (i.e., by $10,000, from $250,000 to $240,000).
o        The  remaining  dollar-for-dollar  limit  ("Remaining  Limit") for the balance of the first Annuity Year is also reduced by
         the amount withdrawn (from $12,500 to $2,500).

Example 2. Dollar-for-dollar and proportional reductions

A second  $10,000  withdrawal  is taken on December 18, 2003 (still within the first Annuity  Year).  The Account Value  immediately
before the withdrawal is $180,000.  As the amount withdrawn exceeds the Remaining Limit of $2,500 from Example 1:
o        the base guarantee amount is first reduced by the Remaining Limit (from $240,000 to $237,500);
o        The result is then further reduced by the ratio of A to B, where:
o        A is the amount withdrawn less the Remaining Limit ($10,000 - $2,500, or $7,500).
o        B is the Account Value less the Remaining Limit ($180,000 - $2,500, or $177,500).
     The resulting base guarantee amount is: $237,500 x ( 1 - $7,500 / $177,500), or $227,464.79.
o        The Remaining Limit is set to zero (0) for the balance of the first Annuity Year.

Example 3. Reset of the Dollar-for-dollar Limit

A  $10,000  withdrawal  is  made  on  December  19,  2004  (second  Annuity  Year).  The  Remaining  Limit  has  been  reset  to the
dollar-for-dollar limit of $12,500. As the amount withdrawn is less than the dollar-for-dollar limit:
o        The base guarantee amount is reduced by the amount withdrawn (i.e., reduced by $10,000, from $227,464.79 to $217,464.79).
o        The Remaining  Limit for the balance of the second  Annuity Year is also reduced by the amount  withdrawn  (from $12,500 to
         $2,500).

KEY FEATURE - Allocation of Account Value
In general,  you have  discretion  over the  allocation  of your  Account  Value that remains  allocated in the variable  investment
options.  However,  we reserve the right to prohibit  investment in certain  Portfolios if you  participate in the program.  Account
Value is only transferred to and maintained in Fixed  Allocations to the extent we, in our sole discretion,  deem it is necessary to
         ----
support our  guarantee(s)  under the program.  This permits your Annuity to participate in the upside  potential of the Sub-accounts
while only transferring  amounts to Fixed Allocations to protect against  significant market downturns.  We monitor  fluctuations in
your Account Value each business day, as well as the  prevailing  interest  rates on Fixed  Allocations,  the remaining  duration(s)
until the applicable maturity date(s) and the amount of Account Value allocated to Fixed  Allocation(s)  relative to a "reallocation
trigger",  which  determines  whether Account Value must be transferred to or from Fixed  Allocation(s).  While you are not notified
when your Account Value reaches a  reallocation  trigger,  you will receive a  confirmation  statement  indicating the transfer of a
portion of your Account Value either to or from Fixed Allocation(s).

|X|      If your Account Value is greater than or equal to the reallocation  trigger,  your Account Value in the variable investment
     options  will  remain  allocated  according  to your most recent  instructions.  If a portion of Account  Value was  previously
     allocated  to a Fixed  Allocation  to support  the  applicable  guaranteed  amount,  all or a portion of those  amounts  may be
     transferred from the Fixed Allocation and re-allocated to the variable  investment  options pro-rata  according to your current
     allocations  (including  the model  allocations  under any asset  allocation  program  you may have  elected).  A Market  Value
     Adjustment will apply when we reallocate Account Value from a Fixed Allocation to the variable  investment  options,  which may
     result in a decrease or increase in your Account Value.

|X|      If your Account Value is less than the  reallocation  trigger,  a portion of your Account Value in the variable  investment
     options will be  transferred  to a new Fixed  Allocation(s)  to support the  applicable  guaranteed  amount.  These amounts are
     transferred  on a pro-rata  basis from the  variable  investment  options.  The new Fixed  Allocation(s)  will have a Guarantee
     Period  equal to the time  remaining  until the  applicable  maturity  date(s).  The Account  Value  allocated to the new Fixed
     Allocation(s)  will be credited with the fixed interest  rate(s) then being credited to a new Fixed  Allocation(s)  maturing on
     the applicable  maturity date(s) (rounded to the next highest yearly duration).  The Account Value will remain invested in each
     applicable Fixed Allocation until the applicable  maturity date unless,  at an earlier date, your Account Value is greater than
     or equal to the  reallocation  trigger and,  therefore,  amounts can be  transferred to the variable  investment  options while
     maintaining the guaranteed protection under the program (as described above).

====================================================================================================================================
If a  significant  amount of your  Account  Value is  systematically  transferred  to Fixed  Allocations  to support  the  Protected
Principal Value and/or the Enhanced  Protected  Principal Value during prolonged market declines,  less of your Account Value may be
immediately  available to participate in the upside  potential of the variable  investment  options if there is a subsequent  market
recovery.  During the period prior to the maturity  date of the base  guarantee or any enhanced  guarantee,  or any  anniversary  of
such maturity date(s),  a significant  portion of your Account Value may be allocated to Fixed Allocations to support any applicable
guaranteed  amount(s).  If your Account Value is less than the  reallocation  trigger and new Fixed  Allocations must be established
during  periods where the interest  rate(s) being  credited to such Fixed  Allocations  is extremely  low, a larger  portion of your
Account Value may need to be transferred to Fixed Allocations to support the applicable guaranteed amount(s).
====================================================================================================================================

Separate Fixed  Allocations  may be established in support of the Protected  Principal  Value and the Enhanced  Protected  Principal
Value (if elected).  There may also be  circumstances  when a Fixed  Allocation will be established only in support of the Protected
Principal Value or the Enhanced  Protected  Principal  Value. If you elect an enhanced  guarantee,  it is more likely that a portion
of your Account  Value may be allocated to Fixed  Allocations  and will remain  allocated for a longer period of time to support the
Enhanced  Protected  Principal Value, even during a period of positive market  performance  and/or under  circumstances  where Fixed
Allocations  would not be necessary to support the  Protected  Principal  Value.  Further,  there may be  circumstances  where Fixed
Allocations in support of the Protected  Principal Value are transferred to the variable  investment options while Fixed Allocations
in support of an Enhanced  Protected  Principal Value are not transferred  because they must remain invested in the Fixed Allocation
in support of the higher enhanced guarantee.

American  Skandia uses an allocation  mechanism  based on  assumptions  of expected and maximum  market  volatility to determine the
reallocation  trigger.  The allocation  mechanism is used to determine the allocation of Account Value between Fixed Allocations and
the Sub-accounts you choose.  American  Skandia reserves the right to change the allocation  mechanism and the reallocation  trigger
at its  discretion,  subject to regulatory  approval where required.  Changes to the allocation  mechanism  and/or the  reallocation
trigger may be applied to existing programs where allowed by law.

Election of the Program
The  Guaranteed  Return  Option Plus  program can be elected at the time that you  purchase  your  Annuity,  or on any  business day
thereafter (prior to  annuitization).  If you elect the program after the Issue Date of your Annuity,  the program will be effective
as of the business day that we receive the required  documentation in good order at our home office,  and the guaranteed amount will
be based on your Account Value as of that date. If you  previously  elected the  Guaranteed  Return Option program and wish to elect
the  Guaranteed  Return  Option Plus  program,  your prior  Guaranteed  Return  Option  program will be  terminated  (including  the
guaranteed  amount(s))  and the  Guaranteed  Return Option Plus program will be added to your Annuity  based on the current  Account
Value.  This election of GRO PlusSM may result in a market value adjustment, which could increase or decrease your Account Value.



Termination of the Program
The Annuity Owner can elect to terminate the enhanced  guarantee but maintain the  protection  provided by the base  guarantee.  The
Annuity Owner also can terminate the  Guaranteed  Return Option Plus program  entirely.  An Annuity Owner who terminates the program
entirely can  subsequently  elect to  participate  in the program again (based on the Account Value on that date) by furnishing  the
documentation we require.  In a rising market,  an Annuity Owner could,  for example,  terminate the program on a given business day
and two weeks later  reinstate  the program  with a higher base  guarantee  (and a new  maturity  date).  However,  your  ability to
reinstate the program is limited by the  following:  (A) in any Annuity  Year, we do not permit more than two program  elections and
(B) a program reinstatement cannot be effected on the same business day on which a program termination was effected.

The program will terminate  automatically  upon: (a) the death of the Owner or the Annuitant (in an entity owned  contract);  (b) as
of the date  Account  Value is applied  to begin  annuity  payments;  or (c) upon full  surrender  of the  Annuity.  If you elect to
terminate the program prior to the applicable  maturity  date, the Guaranteed  Return Option Plus will no longer provide a guarantee
of your  Account  Value.  The  surviving  spouse  may elect the  benefit  at any time  after the  death of the  Annuity  Owner.  The
surviving  spouse's  election will be effective on the business day that we receive the required  documentation in good order at our
home office, and the Account Value on that business day will be the Protected Principal Value.

The charge for the  Guaranteed  Return Option Plus program will no longer be deducted from your Account  Value upon  termination  of
the program.

Special Considerations under the Guaranteed Return Option Plus
This program is subject to certain rules and restrictions, including, but not limited to the following:
|X|      Upon inception of the program,  100% of your Account Value must be allocated to the variable  investment  options. No Fixed
     Allocations may be in effect as of the date that you elect to participate in the program.  However,  the  reallocation  trigger
     may transfer Account Value to Fixed Allocations as of the effective date of the program under some circumstances.
|X|      Annuity Owners cannot  allocate any portion of Purchase  Payments or transfer  Account Value to or from a Fixed  Allocation
     while  participating in the program,  and cannot  participate in any dollar cost averaging program that transfers Account Value
     from a Fixed Allocation to the variable investment options.
|X|      Additional  Purchase Payments  (including any credits  associated with such Purchase Payments) applied to the Annuity while
     the program is in effect will increase the applicable  guarantee amount by the actual amount of the Purchase Payment;  however,
     all or a portion of any additional  Purchase  Payments  (including any credits  associated with such Purchase  Payments) may be
     allocated by us to Fixed Allocations to support the additional amount guaranteed.
|X|      Transfers from Fixed  Allocations will be subject to the Market Value Adjustment  formula under the Annuity;  however,  the
     0.10%  "cushion"  feature of the  formula  will not apply.  A Market  Value  Adjustment  may be either  positive  or  negative.
     Transfer amounts will be taken from the most recently applied Fixed Allocation.
|X|      Transfers from the Sub-accounts to Fixed Allocations or from Fixed  Allocations to the Sub-accounts  under the program will
     not count toward the maximum number of free transfers allowable under the Annuity.
|X|      Any amounts  applied to your Account  Value by American  Skandia on the maturity  date or any  anniversary  of the maturity
     date will not be treated as "investment in the contract" for income tax purposes.

Charges under the Program
We deduct a charge equal to 0.25% of Account  Value per year to  participate  in the  Guaranteed  Return  Option Plus  program.  The
annual  charge is deducted  daily  against your  Account  Value  allocated to the  Sub-accounts.  Account  Value  allocated to Fixed
Allocations  under the program is not subject to the charge.  The charge is deducted to  compensate  American  Skandia  for: (a) the
risk that your Account Value on the maturity date is less than the amount guaranteed; and (b) administration of the program.

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In those  jurisdictions  where we have not received  regulatory  approval for the Guaranteed Return Option Plus rider, we may offer,
where  available,   the  Guaranteed  Return  Option  rider  described  below.  Certain  terms  and  conditions  may  differ  between
jurisdictions.  The  Guaranteed  Return Option rider is not  available if you elect the  Guaranteed  Return  Option Plus rider,  the
Guaranteed Minimum Withdrawal Benefit rider or the Guaranteed Minimum Income Benefit rider.
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Guaranteed Return Option (GRO)SM
We also offer a seven-year  program  where we monitor your Account Value daily and  systematically  transfer  amounts  between Fixed
Allocations and the variable  investment  options you choose.  American Skandia guarantees that at the end of the seventh (7th) year
from  commencement  of the program (or any program  restart date),  you will receive no less than your Account Value on the date you
elected to  participate  in the program  ("commencement  value").  On the program  maturity date, if your Account Value is below the
commencement  value,  American  Skandia will apply additional  amounts to your Annuity so that it is equal to commencement  value or
your  Account  Value on the date you elect to restart the program  duration.  Any amounts  added to your  Annuity will be applied to
the AST Money Market Sub-account,  unless you provide us with alternative  instructions.  We will notify you of any amounts added to
your Annuity  under the program.  We do not consider  amounts  added to your Annuity to be  "investment  in the contract" for income
tax purposes.

Account Value is only  transferred  to and  maintained in Fixed  Allocations  to the extent we, in our sole  discretion,  deem it is
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necessary to support our  guarantee  under the program.  This differs  from the Balanced  Investment  Program  where a set amount is
allocated to a Fixed Allocation  regardless of the performance of the underlying  Sub-accounts.  With the Guaranteed  Return Option,
your  Annuity  is able to  participate  in the  upside  potential  of the  Sub-accounts  while  only  transferring  amounts to Fixed
Allocations  to  protect  against  significant  market  downturns.   NOTE:  If  a  significant  amount  of  your  Account  Value  is
systematically  transferred to Fixed  Allocations  during prolonged  market declines,  less of your Account Value may be immediately
available to participate in the upside potential of the Sub-accounts if there is a subsequent market recovery.

Each business day we monitor the  performance of your Account Value to determine  whether it is greater than,  equal to or below our
"reallocation  trigger",  described  below.  Based on the  performance  of the  Sub-accounts  in which you choose to  allocate  your
Account  Value  relative  to the  reallocation  trigger,  we may  transfer  some or all of  your  Account  Value  to or from a Fixed
Allocation.  You have  complete  discretion  over the  allocation  of your  Account  Value that  remains  allocated  in the variable
investment options.  However, we reserve the right to restrict certain Portfolios if you participate in the program.

|X|      Account  Value  greater than or equal to  reallocation  trigger:  Your Account  Value in the  variable  investment  options
              remains allocated according to your most recent  instructions.  If a portion of Account Value was previously allocated
              to a Fixed  Allocation,  those amounts may be transferred  from the Fixed  Allocation and re-allocated to the variable
              investment options pro-rata according to your current allocations.  A Market Value Adjustment will apply.

|X|      Account  Value  below  reallocation  trigger:  A portion  of your  Account  Value in the  variable  investment  options  is
              transferred  to a new  Fixed  Allocation.  These  amounts  are  transferred  on a  pro-rata  basis  from the  variable
              investment  options.  The new Fixed  Allocation  will have a Guarantee  Period equal to the remaining  duration in the
              Guaranteed  Return  Option.  The Account  Value  applied to the new Fixed  Allocation  will be credited with the fixed
              interest rate then being  applied to a new Fixed  Allocation  of the next higher  yearly  duration.  The Account Value
              will remain invested in the Fixed Allocation  until the maturity date of the program unless,  at an earlier date, your
              Account  Value is at or above the  reallocation  trigger and amounts can be  transferred  to the  variable  investment
              options (as described above) while maintaining the guarantee protection under the program.

American  Skandia uses an allocation  mechanism  based on  assumptions  of expected and maximum  market  volatility to determine the
reallocation  trigger.  The allocation  mechanism is used to determine the allocation of Account Value between Fixed Allocations and
the Sub-accounts you choose.  American  Skandia reserves the right to change the allocation  mechanism and the reallocation  trigger
at its discretion,  subject to regulatory  approval where required.  Any change to the allocation  mechanism and/or the reallocation
trigger will only apply to programs that begin after the change is effective.

Program Termination
The Guaranteed  Return Option will  terminate on its maturity  date. You can elect to participate in a new Guaranteed  Return Option
or re-allocate  your Account Value at that time.  Upon  termination,  any Account Value allocated to the Fixed  Allocations  will be
transferred to the AST Money Market Sub-account, unless you provide us with alternative instructions.

Special Considerations under the Guaranteed Return Option
This program is subject to certain rules and restrictions, including, but not limited to the following:
|X|      You may  terminate  the  Guaranteed  Return  Option at any time.  American  Skandia  does not provide any  guarantees  upon
     termination of the program.
|X|      Withdrawals  from your  Annuity  while the  program is in effect  will reduce the  guaranteed  amount  under the program in
     proportion  to your Account Value at the time of the  withdrawal.  Withdrawals  will be subject to all other  provisions of the
     Annuity, including any Contingent Deferred Sales Charge or Market Value Adjustment that would apply.
|X|      Additional  Purchase  Payments  applied  to the  Annuity  while the  program  is in effect  will only  increase  the amount
     guaranteed; however, all or a portion of any additional Purchase Payments may be allocated to the Fixed Allocations.
|X|      Annuity Owners cannot transfer Account Value to or from a Fixed  Allocation  while  participating in the program and cannot
     participate  in any dollar cost  averaging  program  that  transfers  Account  Value from a Fixed  Allocation  to the  variable
     investment options.
|X|      Transfers from Fixed  Allocations will be subject to the Market Value Adjustment  formula under the Annuity;  however,  the
     0.10%  "cushion"  feature of the  formula  will not apply.  A Market  Value  Adjustment  may be either  positive  or  negative.
     Transfer amounts will be taken from the most recently applied Fixed Allocation.
|X|      Transfers from the Sub-accounts to Fixed Allocations or from Fixed  Allocations to the Sub-accounts  under the program will
     not count toward the maximum number of free transfers allowable under the Annuity.
|X|      The  Guaranteed  Return  Option  will  terminate:  (a) upon the death of the  Owner or the  Annuitant  (in an entity  owned
     contract); and (b) as of the date Account Value is applied to begin annuity payments.
|X|      You can elect to restart the seven (7) year  program  duration on any  anniversary  of the Issue Date of the  Annuity.  The
     Account  Value on the date the restart is  effective  will become the new  commencement  value.  You can only elect the program
     once per Annuity Year.

Charges under the Guaranteed Return Option Program
We deduct a charge equal to 0.25% per year to  participate  in the  Guaranteed  Return  Option.  The annual charge is deducted daily
against your Account Value allocated to the  Sub-accounts.  In certain states,  the charge is deducted in arrears on an annual basis
on each  anniversary  of the Issue Date of the  Annuity.  Account  Value  allocated  to Fixed  Allocations  under the program is not
subject to the charge.  The charge is deducted to  compensate  American  Skandia for:  (a) the risk that your  Account  Value on the
maturity date of the program is less than the amount guaranteed; and (b) administration of the program.

GUARANTEED MINIMUM WITHDRAWAL BENEFIT (GMWB)

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The Guaranteed  Minimum Withdrawal  Benefit program described below is being offered in those  jurisdictions  where we have received
regulatory  approval  and  will be  offered  subsequently  in other  jurisdictions  when we  receive  regulatory  approval  in those
jurisdictions.  Certain terms and conditions  may differ between  jurisdictions  once approved.  Currently,  the program can only be
elected by new  purchasers on the Issue Date of their  Annuity.  We may offer the program to existing  Annuity Owners in the future,
subject to our  eligibility  rules and  restrictions.  The Guaranteed  Minimum  Withdrawal  Benefit  program is not available if you
elect the Guaranteed Return Option, Guaranteed Return Option Plus, or the Guaranteed Minimum Income Benefit rider.
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We offer a program that  guarantees  your ability to withdraw  amounts equal to an initial  principal  value (called the  "Protected
Withdrawal  Value"),  regardless of the impact of market  performance on your Account Value,  subject to our program rules regarding
the timing and amount of withdrawals.  The program may be appropriate if you intend to make periodic  withdrawals  from your Annuity
and wish to ensure that market  performance  will not affect your  ability to protect your  principal.  You are not required to make
withdrawals as part of the program - the guarantee is not lost if you withdraw less than the maximum  allowable  amount of principal
each year under the rules of the program.  There is an additional charge if you elect the GMWB program;  however,  the charge may be
waived under certain circumstances described below.

KEY FEATURE - Protected Withdrawal Value
The  Protected  Withdrawal  Value is the total amount that we  guarantee  will be  available  to you through  withdrawals  from your
Annuity and/or benefit  payments,  regardless of the impact of market  performance on your Account Value.  The Protected  Withdrawal
Value is reduced  with each  withdrawal  you make until the  Protected  Withdrawal  Value is  reduced  to zero.  When the  Protected
Withdrawal Value is reduced to zero due to your withdrawals,  the GMWB program terminates.  Additionally,  the Protected  Withdrawal
Value is used to  determine  the  maximum  annual  amount that you can  withdraw  from your  Annuity,  called the  Protected  Annual
Withdrawal Amount,  without triggering an adjustment in the Protected  Withdrawal Value. The Protected  Withdrawal Value is referred
to as the "Benefit Base" in the rider we issue for this benefit.

The  Protected  Withdrawal  Value is  determined  as of the date you make your first  withdrawal  under the Annuity  following  your
election of the GMWB program.  The initial  Protected  Withdrawal Value is equal to the greater of (A) the Account Value on the date
you elect the GMWB program,  plus any  additional  Purchase  Payments and any Credits that may be applied to such Purchase  Payments
before the date of your first  withdrawal;  or (B) the Account Value as of the date of the first  withdrawal from your Annuity.  The
Protected  Withdrawal Value may be enhanced by increases in your Account Value due to market  performance  during the period between
your election of the GMWB program and the date of your first withdrawal.

|X|      If you elect the GMWB program at the time you  purchase  your  Annuity,  the Account  Value will be your  initial  Purchase
     Payment plus any Credit applied to such Purchase Payment.

|X|      If we offer the GMWB program to existing  Annuity  Owners,  the Account Value on the  anniversary of the Issue Date of your
     Annuity following your election of the GMWB program will be used to determine the initial Protected Withdrawal Value.

|X|      If you make additional Purchase Payments after your first withdrawal,  the Protected  Withdrawal Value will be increased by
     the amount of the additional Purchase Payment and any Credits that we apply to the Purchase Payment.



You may elect to step-up your  Protected  Withdrawal  Value if, due to positive  market  performance,  your Account Value is greater
than the  Protected  Withdrawal  Value.  You are  eligible to step-up the  Protected  Withdrawal  Value on or after the 5th contract
anniversary  following the first  withdrawal  under the GMWB program.  The Protected  Withdrawal Value can be stepped up again on or
after the 5th contract  anniversary  following the preceding  step-up.  If you elect to step-up the Protected  Withdrawal Value, you
must do so during the 30-day period prior to your  eligibility  date. If you elect to step-up the Protected  Withdrawal  Value under
the  program,  and on the date you elect to step-up,  the charges  under the GMWB  program  have  changed for new  purchasers,  your
program may be subject to the new charge going forward.

Upon election of the step-up,  we reset the Protected  Withdrawal  Value to be equal to the then current Account Value. For example,
assume your initial  Protected  Withdrawal  Value was $100,000 and you have made  cumulative  withdrawals  of $40,000,  reducing the
Protected  Withdrawal Value to $60,000.  On the date you are eligible to step-up the Protected  Withdrawal Value, your Account Value
is equal to  $75,000.  You could elect to step-up  the  Protected  Withdrawal  Value to $75,000 on the date you are  eligible.  Upon
election of the step-up,  we also reset the Protected Annual  Withdrawal  Amount  (discussed  immediately  below) to be equal to the
greater of (A) the Protected Annual Withdrawal Amount  immediately prior to the reset; and (B) 7% of the Protected  Withdrawal Value
immediately after the reset.

KEY FEATURE - Protected Annual Withdrawal Amount
The initial  Protected Annual Withdrawal Amount is equal to 7% of the Protected  Withdrawal Value.  Under the GMWB program,  if your
cumulative  withdrawals  each  Annuity  Year are less  than or equal to the  Protected  Annual  Withdrawal  Amount,  your  Protected
Withdrawal Value will be reduced on a  "dollar-for-dollar"  basis (the Protected Withdrawal Value is reduced by the actual amount of
the  withdrawal,  including any CDSC or MVA that may apply).  Cumulative  withdrawals  in any Annuity Year that exceed the Protected
Annual  Withdrawal  Amount  trigger a  proportional  adjustment to both the  Protected  Withdrawal  Value and the  Protected  Annual
Withdrawal  Amount,  as described in the rider for this benefit (see the examples of this calculation  below).  The Protected Annual
Withdrawal Amount is referred to as the "Maximum Annual Benefit" in the rider we issue for this benefit.

The GMWB program does not affect your ability to make  withdrawals  under your Annuity or limit your ability to request  withdrawals
that exceed the Protected  Annual  Withdrawal  Amount.  You are not required to withdraw all or any portion of the Protected  Annual
Withdrawal Amount each Annuity Year.
|X|      If,  cumulatively,  you withdraw an amount less than the Protected Annual Withdrawal Amount in any Annuity Year, you cannot
     carry-over the unused portion of the Protected  Annual  Withdrawal  Amount to subsequent  Annuity Years.  However,  because the
     Protected Withdrawal Value is only reduced by the actual amount of withdrawals you make under these  circumstances,  any unused
     Protected Annual Withdrawal Amount may extend the period of time until the remaining  Protected  Withdrawal Value is reduced to
     zero.
|X|      Additional  Purchase  Payments  will increase the  Protected  Annual  Withdrawal  Amount by 7% of the  applicable  Purchase
     Payment (and any Credits we apply to such Purchase Payment).
|X|      If the Protected  Annual  Withdrawal  Amount after an  adjustment  exceeds the Protected  Withdrawal  Value,  the Protected
     Annual Withdrawal Amount will be set equal to the Protected Withdrawal Value.

The following  examples of dollar-for  dollar and  proportional  reductions and the reset of the Maximum Annual Benefit assume that:
1.) the Issue Date and the effective  date of the GMWB program are October 13, 2003;  2.) an initial  Purchase  Payment of $250,000;
3.) a Protected Withdrawal Value of $250,000; and 4.) a Protected Annual Withdrawal Amount of $17,500 (7% of $250,000):

Example 1. Dollar-for-dollar reduction

A $10,000  withdrawal  is taken on November 13, 2003 (in the first  Annuity  Year).  No prior  withdrawals  have been taken.  As the
amount withdrawn is less than the Protected Annual Withdrawal Amount:
o        The Protected Withdrawal Value is reduced by the amount withdrawn (i.e., by $10,000, from $250,000 to $240,000).
o        The remaining  Protected Annual  Withdrawal  Amount for the balance of the first Annuity Year is also reduced by the amount
         withdrawn (from $17,500 to $7,500).



Example 2. Dollar-for-dollar and proportional reductions

A second  $10,000  withdrawal  is taken on December 13, 2003 (still within the first Annuity  Year).  The Account Value  immediately
before the withdrawal is $220,000.  As the amount  withdrawn  exceeds the remaining  Protected  Annual  Withdrawal  Amount of $7,500
from Example 1:
o        the Protected  Withdrawal  Value is first reduced by the remaining  Protected  Annual  Withdrawal  Amount (from $240,000 to
     $232,500);
o        The result is then further reduced by the ratio of A to B, where:
o        A is the amount withdrawn less the remaining Protected Annual Withdrawal Amount ($10,000 - $7,500, or $2,500).
o        B is the Account Value less the remaining Protected Annual Withdrawal Amount ($220,000 - $7,500, or $212,500).
The resulting Protected Withdrawal Value is: $232,500 x ( 1 - $2,500 / $212,500), or $229,764.71.
o        the Protected Annual  Withdrawal  Amount is also reduced by the ratio of A to B: The resulting  Protected Annual Withdrawal
     Amount is: $17,500 x ( 1 - $2,500 / $212,500), or $17,294.12.
o        The remaining Protected Annual Withdrawal Amount is set to zero (0) for the balance of the first Annuity Year.

Example 3. Reset of the Maximum Annual Benefit

A $10,000  withdrawal is made on October 13, 2004 (second Annuity Year). The remaining  Protected Annual  Withdrawal Amount has been
reset to the Protected  Annual  Withdrawal  Amount of $17,294.12 from Example 2. As the amount  withdrawn is less than the remaining
Protected Annual Withdrawal Amount:
o        the  Protected  Withdrawal  Value is  reduced by the amount  withdrawn  (i.e.,  reduced by  $10,000,  from  $229,764.71  to
         $219,764.71).
o        The remaining  Protected Annual  Withdrawal Amount for the balance of the second Annuity Year is also reduced by the amount
         withdrawn (from $17,294.12 to $7,294.12).

BENEFITS UNDER THE GMWB PROGRAM

|X|      In addition to any  withdrawals  you make under the GMWB program,  market  performance  may reduce your Account  Value.  If
     your  Account  Value is  equal  to zero,  and you have  not  received  all of your  Protected  Withdrawal  Value in the form of
     withdrawals from your Annuity, we will continue to make payments equal to the remaining Protected  Withdrawal Value in the form
     of  fixed,  periodic  payments  until  the  remainder  of the  Protected  Withdrawal  Value is paid,  at which  time the  rider
     terminates.  The fixed,  periodic  payments will each be equal to the Protected Annual Withdrawal  Amount,  except for the last
     payment which may be equal to the remaining  Protected  Withdrawal  Value.  We will  determine the duration for which  periodic
     payments will continue by dividing the Protected  Withdrawal  Value by the Protected  Annual  Withdrawal  Amount.  You will not
     have the right to make additional  Purchase  Payments or receive the remaining  Protected  Withdrawal  Value in a lump sum. You
     can elect the frequency of payments, subject to our rules then in effect.

|X|      If the death benefit under the Annuity becomes payable before you have received all of your Protected  Withdrawal  Value in
     the form of  withdrawals  from your  Annuity,  your  Beneficiary  has the option to elect to receive  the  remaining  Protected
     Withdrawal  Value as an alternate  death benefit  payout in lieu of the amount  payable under any other death benefit  provided
     under the Annuity.  The remaining  Protected  Withdrawal Value will be payable in the form of fixed,  periodic  payments.  Your
     beneficiary  can elect the  frequency  of payments,  subject to our rules then in effect.  We will  determine  the duration for
     which periodic  payments will continue by dividing the Protected  Withdrawal Value by the Protected Annual  Withdrawal  Amount.
     The Protected  Withdrawal  Value is not equal to the Account Value for purposes of the Annuity's  other death benefit  options.
     The GMWB program does not increase or decrease the amount  otherwise  payable under the Annuity's other death benefit  options.
     Generally,  the GMWB program would be of value to your  Beneficiary  only when the Protected  Withdrawal Value at death exceeds
     any other amount available as a death benefit.

|X|      If you elect to begin receiving  annuity  payments before you have received all of your Protected  Withdrawal  Value in the
     form of  withdrawals  from your  Annuity,  an  additional  annuity  payment  option will be available  that makes fixed annuity
     payments for a certain  period,  determined  by dividing the Protected  Withdrawal  Value by the  Protected  Annual  Withdrawal
     Amount.  If you elect to receive annuity payments  calculated in this manner,  the assumed interest rate used to calculate such
     payments will be 0%, which is less than the assumed  interest rate on other annuity payment  options we offer.  This 0% assumed
     interest  rate results in lower annuity  payments  than what would have been paid if the assumed  interest rate was higher than
     0%. You can also elect to terminate the GMWB program and begin  receiving  annuity  payments based on your then current Account
     Value (not the remaining Protected Withdrawal Value) under any of the available annuity payment options.

Other Important Considerations
|X|      Withdrawals  under the GMWB program are subject to all of the terms and  conditions of the Annuity,  including any CDSC and
     MVA that may apply.  Amounts  withdrawn up to the  Protected  Annual  Withdrawal  Amount will  generally  not be subject to any
     applicable CDSC since they are less than the amount available under any free withdrawal provision of your Annuity.
|X|      Withdrawals  made while the GMWB  program is in effect  will be  treated,  for tax  purposes,  in the same way as any other
     withdrawals under the Annuity.
|X|      The GMWB program  does not  directly  affect the  Annuity's  Account  Value or Surrender  Value,  but any  withdrawal  will
     decrease  the Account  Value by the amount of the  withdrawal.  If you  surrender  your  Annuity,  you will receive the current
     Surrender Value, not the Protected Withdrawal Value.
|X|      You can make  withdrawals  from your Annuity  while your Account  Value is greater  than zero without  purchasing  the GMWB
     program.  The GMWB program  provides a guarantee  that if your Account Value  declines due to market  performance,  you will be
     able to receive your Protected Withdrawal Value in the form of periodic benefit payments.
|X|      We reserve the right to impose restrictions on the allocation of your Account Value,  including prohibiting  allocations to
     certain Portfolios.  We may also require that you allocate your Account Value according to an asset allocation model,  although
     it is not our current requirement.

Election of the Program
Currently,  the GMWB program can only be elected at the time that you purchase your Annuity.  In the future,  we may offer  existing
Annuity  Owners the option to elect the GMWB program after the Issue Date of their  Annuity,  subject to our  eligibility  rules and
restrictions.  If you elect the GMWB  program  after the Issue Date of your  Annuity,  the program  will be effective as of the next
anniversary  date. Your Account Value as of such anniversary date will be used to calculate the initial  Protected  Withdrawal Value
and the initial Protected Annual Withdrawal Amount.

We reserve the right to restrict the maximum amount of Protected  Withdrawal  Value that may be covered under the GMWB program under
this Annuity or any other annuities that you own that are issued by American Skandia or its affiliated companies.

Termination of the Program
The  program  terminates  automatically  when your  Protected  Withdrawal  Value  reaches  zero based on your  withdrawals.  You may
terminate  the program at any time by  notifying  us. If you  terminate  the  program,  any  guarantee  provided by the benefit will
terminate as of the date the termination is effective.  The program  terminates  upon your surrender of the Annuity,  upon due proof
of death (unless your  surviving  spouse elects to continue the Annuity and the GMWB program or your  Beneficiary  elects to receive
the amounts payable under the GMWB program in lieu of the death benefit) or upon your election to begin receiving annuity payments.

The charge for the GMWB program will no longer be deducted from your Account Value upon termination of the program.

Charges under the Program
Currently,  we  deduct a charge  equal to 0.35% of  Account  Value per year to  purchase  the GMWB  program.  The  annual  charge is
deducted daily against your Account Value  allocated to the  Sub-accounts.  Account Value allocated to Fixed  Allocations  under the
program is not subject to the charge.

|X|      If, during the seven Annuity Years  following the effective date of the program,  you do not make any  withdrawals,  and do
     not make any additional  Purchase  Payments after a five-year period  following the effective date of the program,  the program
     will remain in effect;  however,  we will waive the annual charge going  forward.  If you make an additional  Purchase  Payment
     following the waiver of the annual charge, we will begin charging for the program.

|X|      If you elect to step-up the  Protected  Withdrawal  Value  under the  program,  and on the date you elect to  step-up,  the
     charges  under the  program  have  changed for new  purchasers,  your  program  may be subject to the new charge  level for the
     benefit.

Additional Tax Considerations for Qualified Contracts
If you  purchase an Annuity as an  investment  vehicle for  "qualified"  investments,  including  an IRA,  SEP-IRA,  Roth IRA or Tax
Sheltered  Annuity (or 403(b)),  the minimum  distribution  rules under the Code require that you begin receiving  periodic  amounts
from your Annuity  beginning after age 70 1/2. The amount required under the Code may exceed the Protected  Annual  Withdrawal  Amount,
which will cause us to recalculate the Protected  Withdrawal Value and the Protected Annual Withdrawal Amount,  resulting in a lower
amount  payable in future  Annuity  Years.  In  addition,  the amount and duration of payments  under the annuity  payment and death
benefit  provisions may be adjusted so that the payments do not trigger any penalty or excise taxes due to tax  considerations  such
as minimum distribution requirements.



GUARANTEED MINIMUM INCOME BENEFIT (GMIB)

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The  Guaranteed  Minimum Income  Benefit  program  described  below is being offered in those  jurisdictions  where we have received
regulatory  approval,  and will be  offered  subsequently  in other  jurisdictions  when we  receive  regulatory  approval  in those
jurisdictions.  Certain terms and conditions  may differ between  jurisdictions  once approved.  Currently,  the program can only be
elected by new  purchasers on the Issue Date of their  Annuity.  We may offer the program to existing  Annuity Owners in the future,
subject to our  eligibility  rules and  restrictions.  The Guaranteed  Minimum Income Benefit  program is not available if you elect
the Guaranteed Return Option program, Guaranteed Return Option Plus program or the Guaranteed Minimum Withdrawal Benefit rider.
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We offer a program that, after a seven-year  waiting period,  guarantees your ability to begin receiving income from your Annuity in
the form of annuity  payments  based on a guaranteed  minimum value (called the "Protected  Income Value") that increases  after the
waiting period begins,  regardless of the impact of market  performance  on your Account Value.  The program may be appropriate  for
you if you  anticipate  using your Annuity as a future source of periodic  fixed income  payments for the remainder of your life and
wish to ensure that the basis upon which your income  payments will be calculated  will achieve at least a minimum  amount of growth
despite fluctuations in market performance.  There is an additional charge if you elect the GMIB program.

KEY FEATURE - Protected Income Value
The Protected  Income Value is the minimum amount that we guarantee will be available (net of any applicable  premium taxes),  after
a waiting  period of at least seven years,  to begin  receiving  fixed annuity  payments.  The  Protected  Income Value is initially
established on the effective  date of the GMIB program and is equal to your Account Value on such date.  The Protected  Income Value
is increased  daily based on an annual growth rate of 5%, subject to the limitations  described  below.  The Protected  Income Value
is referred to as the  "Protected  Value" in the rider we issue for this  benefit.  The 5% annual  growth rate is referred to as the
"Roll-Up Percentage" in the rider we issue for this benefit.

The  Protected  Income  Value is  subject  to a limit of 200%  (2X) of the sum of the  Protected  Income  Value  established  on the
effective  date of the GMIB  program  plus any  additional  Purchase  Payments  and any Credits  that are  applied to such  Purchase
Payments made after the waiting period begins ("Maximum  Protected Income Value"),  minus the sum of any reductions in the Protected
Income Value due to withdrawals you make from the Annuity after the waiting period begins.

|X|      Subject to the maximum  age/durational  limits described immediately below, we will no longer increase the Protected Income
     Value by the 5% annual growth rate once you reach the Maximum Protected Income Value.  However,  we will increase the Protected
     Income Value by the amount of any  additional  Purchase  Payments and any Credits  applied to such Purchase  Payments after you
     reach the Maximum  Protected  Income Value.  Further,  if you make  withdrawals  after you reach the Maximum  Protected  Income
     Value, we will reduce the Protected Income Value by the proportional impact of the withdrawal on your Account Value.

|X|      Subject to the Maximum  Protected  Income Value,  we will no longer  increase the  Protected  Income Value by the 5% annual
     growth rate after the later of the  anniversary  date on or  immediately  following  the  Annuitant's  80th birthday or the 7th
     anniversary of the later of the effective date of the GMIB program or the effective date of the most recent  step-up.  However,
     we will increase the Protected Income Value by the amount of any additional  Purchase  Payments and any Credits applied to such
     Purchase  Payments.  Further,  if you make withdrawals  after the Annuitant  reaches the maximum  age/duration  limits, we will
     reduce the Protected Income Value by the proportional impact of the withdrawal on your Account Value.

|X|      Subject to the Maximum Protected Income Value, if you make an additional  Purchase Payment,  we will increase the Protected
     Income Value by the amount of the Purchase  Payment  (including  any Credits that may be applied to your Account Value based on
     such  Purchase  Payment)  and will apply the 5% annual  growth  rate on the new amount  from the date the  Purchase  Payment is
     applied.

|X|      As described  below,  after the waiting period begins,  cumulative  withdrawals  each Annuity Year that are up to 5% of the
     Protected  Income Value will reduce the Protected  Income Value by the amount of the withdrawal.  Cumulative  withdrawals  each
     Annuity  Year in  excess  of 5% of the  Protected  Income  Value  will  reduce  the  Protected  Income  Value  proportionately.
     Withdrawals  after the Maximum  Protected Income Value is reached will reduce the Protected Income Value  proportionately.  The
     5% annual growth rate will be applied to the reduced Protected Income Value from the date of the withdrawal.

Stepping-Up  the Protected  Income Value - You may elect to "step-up" or "reset" your  Protected  Income Value if your Account Value
- ----------------------------------------
is greater than the current  Protected Income Value.  Upon exercise of the step-up  provision,  your initial  Protected Income Value
will be reset equal to your current  Account  Value.  From the date that you elect to step-up the Protected  Income  Value,  we will
apply the 5% annual growth rate to the stepped-up  Protected  Income Value,  as described  above.  You can only exercise the step-up
provision twice while the GMIB program is in effect, and only while the Annuitant is less than age 76.

|X|      A new  seven-year  waiting  period will be  established  upon the effective  date of your election to step-up the Protected
     Income Value.  You cannot exercise your right to begin receiving  annuity  payments under the GMIB program until the end of the
     new waiting period.
|X|      The Maximum  Protected  Income  Value will be reset as of the  effective  date of any  step-up.  The new Maximum  Protected
     Income Value will be equal to 200% of the sum of the Protected  Income Value as of the  effective  date of the step-up plus any
     subsequent  Purchase Payments and any Credits applied to such Purchase Payments,  minus the impact of any withdrawals after the
     date of the step-up.
|X|      When  determining the guaranteed  annuity  purchase rates for annuity  payments under the GMIB program,  we will apply such
     rates based on the number of years since the most recent step-up.
|X|      If you elect to step-up the  Protected  Income Value under the program,  and on the date you elect to step-up,  the charges
     under the GMIB program have changed for new purchasers, your program may be subject to the new charge going forward.

Impact of  Withdrawals on the Protected  Income Value - Cumulative  withdrawals  each Annuity Year up to 5% of the Protected  Income
- -----------------------------------------------------
Value will reduce the Protected  Income Value on a  "dollar-for-dollar"  basis (the Protected  Income Value is reduced by the actual
amount of the  withdrawal).  Cumulative  withdrawals  in any Annuity Year in excess of 5% of the Protected  Income Value will reduce
the  Protected  Income Value  proportionately  (see the examples of this  calculation  below).  The 5% annual  withdrawal  amount is
determined on each  anniversary  of the Issue Date (or on the Issue Date for the first Annuity Year) and applies to any  withdrawals
during the Annuity Year. This means that the amount  available for withdrawals each Annuity Year on a  "dollar-for-dollar"  basis is
adjusted to reflect changes in the Protected Income Value during the prior Annuity Year.

The following examples of  dollar-for-dollar  and proportional  reductions assume that: 1.) the Issue Date and the effective date of
the GMIB  program are October 13,  2003;  2.) an initial  Purchase  Payment of $250,000;  3.) an initial  Protected  Income Value of
$250,000; and 4.) a dollar-for-dollar limit of $12,500 (5% of $250,000):

Example 1. Dollar-for-dollar reduction

A  $10,000  withdrawal  is  taken on  November  13,  2003 (in the  first  Annuity  Year).  No prior  withdrawals  have  been  taken.
Immediately  prior to the withdrawal,  the Protected  Income Value is $251,038.10  (the initial value  accumulated for 31 days at an
annual effective rate of 5%).  As the amount withdrawn is less than the dollar-for-dollar limit:
o        the Protected Income Value is reduced by the amount withdrawn (i.e., by $10,000, from $251,038.10 to $241,038.10).
o        The  remaining  dollar-for-dollar  limit  ("Remaining  Limit") for the balance of the first Annuity Year is also reduced by
         the amount withdrawn (from $12,500 to $2,500).

Example 2. Dollar-for-dollar and proportional reductions

A second  $10,000  withdrawal  is taken on  December  13,  2003  (still  within  the first  Annuity  Year).  Immediately  before the
withdrawal,  the Account  Value is $220,000 and the  Protected  Income Value is  $242,006.64.  As the amount  withdrawn  exceeds the
Remaining Limit of $2,500 from Example 1:
o        the Protected Income Value is first reduced by the Remaining Limit (from 242,006.64 to 239,506.64);
o        The result is then further reduced by the ratio of A to B, where:
o        A is the amount withdrawn less the Remaining Limit ($10,000 - $2,500, or $7,500).
o        B is the Account Value less the Remaining Limit ($220,000 - $2,500, or $217,500).
     The resulting Protected Income Value is: $239,506.64 x ( 1 - $7,500 / $217,500), or $231,247.79.
o        The Remaining Limit is set to zero (0) for the balance of the first Annuity Year.

Example 3. Reset of the Dollar-for-dollar Limit

A $10,000  withdrawal is made on the first  anniversary  of the Issue Date,  October 13, 2004 (second  Annuity  Year).  Prior to the
withdrawal,  the Protected  Income Value is $240,870.56.  The Remaining Limit is reset to 5% of this amount,  or $12,043.53.  As the
amount withdrawn is less than the dollar-for-dollar limit:
o        the Protected Income Value is reduced by the amount withdrawn (i.e., reduced by $10,000, from $240,870.56 to $230,870.56).
o        The Remaining  Limit for the balance of the second Annuity Year is also reduced by the amount  withdrawn  (from  $12,043.53
         to $2,043.53).

KEY FEATURE - GMIB Annuity Payments
You can elect to apply the Protected  Income Value to one of the available  GMIB Annuity  Payment  Options on any  anniversary  date
following the initial  waiting  period,  or any subsequent  waiting period  established  upon your election to step-up the Protected
Income  Value.  Once you have  completed  the  waiting  period,  you will have a 30-day  period  each  year,  prior to the  contract
anniversary,  during which you may elect to begin  receiving  annuity  payments  under one of the  available  GMIB  Annuity  Payment
Options.  You must elect one of the GMIB Annuity  Payment  Options by the  anniversary of the Annuity's Issue Date on or immediately
following the  Annuitant's  95th birthday,  except for Annuities used as a funding  vehicle for an IRA, SEP IRA or 403(b),  in which
the case you must elect one of the GMIB Annuity  Payment  Options by the  anniversary of the Annuity's  Issue Date on or immediately
following the Annuitant's 92nd birthday.

The amount of each GMIB Annuity  Payment will be determined  based on the age and,  where  permitted by law, sex of the Annuitant by
applying the  Protected  Income Value (net of any  applicable  premium tax that may be due) to the GMIB Annuity  Payment  Option you
choose.  We use  special  annuity  purchase  rates to  calculate  the  amount of each  payment  due under the GMIB  Annuity  Payment
Options.  These  special  rates for the GMIB Annuity  Payment  Options are  calculated  using an assumed  interest  rate factor that
provides for lower growth in the value applied to produce  annuity  payments than if you elected an annuity  payment  option that is
not part of the GMIB program.  These special rates also are  calculated  using other factors such as "age  setbacks"  (use of an age
lower than the  Annuitant's  actual age) that result in lower  payments than would result if you elected an annuity  payment  option
that is not part of the GMIB program.  Use of an age setback  entails a longer assumed life for the Annuitant  which in turn results
in lower annuity payments.

On the date that you elect to begin  receiving GMIB Annuity  Payments,  we guarantee that your payments will be calculated  based on
your Account Value and our then current annuity  purchase rates if the payment amount  calculated on this basis would be higher than
it would be based on the Protected Income Value and the special GMIB annuity purchase rates.

GMIB Annuity Payment Option 1 - Payments for Life with a Certain Period
Under this option,  monthly  annuity  payments will be made until the death of the  Annuitant.  If the Annuitant  dies before having
received 120 monthly annuity payments, the remainder of the 120 monthly annuity payments will be made to the Beneficiary.

GMIB Annuity Payment Option 2 - Payments for Joint Lives with a Certain Period
Under this option,  monthly  annuity  payments will be made until the death of both the Annuitant  and the Joint  Annuitant.  If the
Annuitant  and the Joint  Annuitant  die before  having  received 120 monthly  annuity  payments,  the  remainder of the 120 monthly
annuity payments will be made to the Beneficiary.
|X|      If the Annuitant  dies first,  we will continue to make  payments  until the later of the death of the Joint  Annuitant and
     the end of the period certain.  However,  if the Joint Annuitant is still receiving  annuity payments  following the end of the
     certain period, we will reduce the amount of each subsequent payment to 50% of the original payment amount.
|X|      If the Joint  Annuitant  dies first,  we will continue to make  payments  until the later of the death of the Annuitant and
     the end of the period certain.

You cannot  withdraw  your  Account  Value or the  Protected  Income Value under  either GMIB  Annuity  Payment  Option once annuity
payments have begun.  We may make other payout frequencies available, such as quarterly, semi-annually or annually.

Other Important Considerations
|X|      The GMIB program does not directly affect the Annuity's  Account Value,  Surrender Value or the amount payable under either
     the basic death benefit provision of the Annuity or any optional death benefit  provision.  If you surrender your Annuity,  you
     will receive the current  Surrender  Value,  not the Protected  Income Value.  The Protected Income Value is only applicable if
     you elect to begin receiving annuity payments under one of the GMIB annuity options after the waiting period.
|X|      The Annuity offers other annuity  payment  options that you can elect which do not impose an additional  charge,  but which
     do not offer to guarantee a minimum value on which to make annuity payments.
|X|      Where allowed by law, we reserve the right to limit subsequent  purchase payments if we determine,  at our sole discretion,
     that based on the timing of your Purchase  Payments and  withdrawals,  your Protected Income Value is increasing in ways we did
     not intend. In determining whether to limit Purchase Payments,  we will look at Purchase Payments which are  disproportionately
     larger than your initial Purchase Payment and other actions that may artificially increase the Protected Income Value.
|X|      We reserve the right to impose restrictions on the allocation of your Account Value,  including prohibiting  allocations to
     certain Portfolios.  We may also require that you allocate your Account Value according to an asset allocation model.
|X|      If you change the  Annuitant  after the effective  date of the GMIB program,  the period of time during which we will apply
     the 5% annual growth rate may be changed based on the age of the new Annuitant.  If the new Annuitant  would not be eligible to
     elect the GMIB program based on his or her age at the time of the change, then the GMIB program will terminate.
|X|      Annuity payments made under the GMIB program are subject to the same tax treatment as any other annuity payment.
|X|      At the time you elect to begin  receiving  annuity  payments  under the GMIB  program  or under any other  annuity  payment
     option we make available,  the protection provided by the Annuity's basic death benefit or any optional death benefit provision
     you elected will no longer apply.

Election of the Program
Currently,  the GMIB program can only be elected at the time that you purchase  your Annuity.  The Annuitant  must be age 75 or less
as of the effective  date of the GMIB program.  In the future,  we may offer  existing  Annuity  Owners the option to elect the GMIB
program after the Issue Date of their Annuity,  subject to our  eligibility  rules and  restrictions.  If you elect the GMIB program
after the Issue Date of your Annuity,  the program will be effective as of the next  anniversary  date. Your Account Value as of the
anniversary date will be used to calculate the Protected Income Value as of the effective date of the program.

Termination of the Program
The GMIB program  cannot be  terminated  by the Owner once  elected.  The GMIB program  automatically  terminates as of the date the
Annuity is fully surrendered,  on the date the death benefit is payable to your Beneficiary  (unless your surviving spouse elects to
continue the Annuity),  or on the date that your Account Value is  transferred to begin making  annuity  payments.  The GMIB program
may also be  terminated  if you  designate a new  Annuitant  who would not be eligible to elect the GMIB program based on his or her
age at the time of the change.

Upon  termination  of the GMIB program we will deduct the charge from your  Account  Value for the portion of the Annuity Year since
the prior anniversary of the Annuity's Issue Date (or the Issue Date if in the first Annuity Year).

Charges under the Program
Currently,  we deduct a charge  equal to 0.50% per year of the average  Protected  Income  Value for the period the charge  applies.
Because the charge is calculated  based on the average  Protected Income Value, it does not increase or decrease based on changes to
the Annuity's Account Value due to market  performance.  If the average  Protected Income Value increases,  the dollar amount of the
annual charge will increase, while a decrease in the Protected Income Value will decrease the dollar amount of the charge.

The charge is deducted  annually in arrears  each Annuity Year on the  anniversary  of the Issue Date of the Annuity.  We deduct the
amount of the charge  pro-rata from the Account Value allocated to the variable  investment  options and the Fixed  Allocations.  No
MVA will apply to Account Value deducted from a Fixed  Allocation.  If you surrender your Annuity,  begin receiving annuity payments
under the GMIB  program  or any other  annuity  payment  option  we make  available  during an  Annuity  Year,  or the GMIB  program
terminates,  we will deduct the charge for the portion of the Annuity Year since the prior  anniversary of the Annuity's  Issue Date
(or the Issue Date if in the first Annuity Year).

No charge applies after the Annuity Date.

DEATH BENEFIT

WHAT TRIGGERS THE PAYMENT OF A DEATH BENEFIT?
The Annuity provides a Death Benefit during its  accumulation  period.  If the Annuity is owned by one or more natural persons,  the
Death  Benefit is payable  upon the first  death of an Owner.  If the  Annuity is owned by an entity,  the Death  Benefit is payable
upon the Annuitant's  death, if there is no Contingent  Annuitant.  If a Contingent  Annuitant was designated before the Annuitant's
death and the  Annuitant  dies,  then the  Contingent  Annuitant  becomes the Annuitant and a Death Benefit will not be paid at that
time.  The person upon whose death the Death Benefit is paid is referred to below as the "decedent."

Basic Death Benefit

The Annuity  provides a basic Death Benefit at no additional  charge.  The Insurance  Charge we deduct daily from your Account Value
allocated to the  Sub-accounts  is used, in part,  to pay us for the risk we assume in providing  the basic Death Benefit  guarantee
under the  Annuity.  The Annuity  also offers two  different  optional  Death  Benefits.  Either  benefit  can be  purchased  for an
additional charge. The additional charge is deducted to compensate  American Skandia for providing  increased  insurance  protection
under the optional Death  Benefits.  Notwithstanding  the additional  protection  provided  under the optional Death  Benefits,  the
additional cost has the impact of reducing the net performance of the investment options.  Under certain  circumstances,  your Death
Benefit  may be reduced by the amount of any  Credits we applied to your  Purchase  Payments.  (see "How are  Credits  Applied to My
Account Value")



The basic Death Benefit is the greater of:
|X|      The sum of all Purchase Payments less the sum of all proportional withdrawals.
|X|      The sum of your Account  Value in the variable  investment  options and your Interim Value in the Fixed  Allocations,  less
         the amount of any Credits applied within 12-months prior to the date of death.

"Proportional  withdrawals"  are  determined  by  calculating  the  percentage  of your  Account  Value that each  prior  withdrawal
represented  when  withdrawn.  For example,  a withdrawal of 50% of Account Value would be considered as a 50% reduction in Purchase
Payments for purposes of calculating the basic Death Benefit.

OPTIONAL DEATH BENEFITS
Two  optional  Death  Benefits  are offered for  purchase  with your  Annuity to provide an enhanced  level of  protection  for your
beneficiaries.

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Currently,  these  benefits  are only  offered and must be elected at the time that you purchase  your  Annuity.  We may, at a later
date,  allow  existing  Annuity Owners to purchase  either of the optional  Death  Benefits  subject to our rules and any changes or
restrictions  in the  benefits.  Certain  terms and  conditions  may differ if you  purchase  your  Annuity as part of an  exchange,
replacement or transfer, in whole or in part, from any other Annuity we issue.
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Enhanced Beneficiary Protection Optional Death Benefit
The Enhanced  Beneficiary  Protection  Optional Death Benefit can provide additional amounts to your Beneficiary that may be used to
offset  federal and state taxes  payable on any taxable  gains in your  Annuity at the time of your death.  Whether  this benefit is
appropriate for you may depend on your particular  circumstances,  including other financial resources that may be available to your
Beneficiary to pay taxes on your Annuity  should you die during the  accumulation  period.  No benefit is payable if death occurs on
or after the Annuity Date.

The  Enhanced  Beneficiary  Protection  Optional  Death  Benefit  provides a benefit  that is payable in addition to the basic Death
Benefit.  If the Annuity has one Owner,  the Owner must be age 75 or less at the time the benefit is  purchased.  If the Annuity has
joint Owners, the oldest Owner must be age 75 or less.  If the Annuity is owned by an entity, the Annuitant must be age 75 or less.

Calculation of Enhanced Beneficiary Protection Optional Death Benefit
If you purchase the Enhanced Beneficiary Protection Optional Death Benefit, the Death Benefit is calculated as follows:

1.       the basic Death Benefit described above;

     PLUS

2.       40% of your "Growth" under the Annuity, as defined below.

The amount calculated in Items 1 & 2 above may be reduced by any Credits under certain circumstances.

"Growth" means the sum of your Account Value in the variable investment options and your Interim Value in the Fixed Allocations,
 ------
minus the total of all Purchase Payments reduced by the sum of all proportional withdrawals.

"Proportional  withdrawals"  are  determined  by  calculating  the  percentage  of your  Account  Value that each  prior  withdrawal
 -------------------------
represented when withdrawn.

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The Enhanced  Beneficiary  Protection Optional Death Benefit is subject to a maximum of 100% of all Purchase Payments applied to the
Annuity at least 12 months prior to the death of the decedent that triggers the payment of the Death Benefit.
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The Enhanced  Beneficiary  Protection Optional Death Benefit described above is currently being offered in those jurisdictions where
we have received  regulatory  approval.  Certain terms and conditions may differ between  jurisdictions once approved.  Please refer
to the section entitled "Tax Considerations" for a discussion of special tax considerations for purchasers of this benefit.
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See Appendix C for examples of how the Enhanced Beneficiary Protection Optional Death Benefit is calculated.



Highest Anniversary Value Death Benefit
If the Annuity has one Owner,  the Owner must be age 79 or less at the time Highest  Anniversary  Value  Optional  Death  Benefit is
purchased.  If the Annuity has joint  Owners,  the oldest  Owner must be age 79 or less.  If the Annuity is owned by an entity,  the
Annuitant must be age 79 or less.

Certain of the Portfolios offered as Sub-accounts under the Annuity are not available if you elect the Highest Anniversary Value
Death Benefit.

Key Terms Used with the Highest Anniversary Value Death Benefit

|X|      The Death Benefit Target Date is the contract  anniversary  on or after the 80th birthday of the current Owner,  the oldest
             -------------------------
     of either joint Owner or the Annuitant, if entity owned.

|X|      The Highest Anniversary Value equals the highest of all previous  "Anniversary  Value" less proportional  withdrawals since
             -------------------------
     such anniversary and plus any Purchase Payments since such anniversary.

|X|      The  Anniversary  Value is the Account  Value as of each  anniversary  of the Issue Date of the  Annuity.  The  Anniversary
              ------------------
     Value on the Issue Date is equal to your Purchase Payment.

|X|      Proportional  withdrawals  result in a  reduction  to the  Highest  Anniversary  Value by  reducing  such value in the same
         -------------------------
     proportion as the Account Value was reduced by the  withdrawal as of the date the  withdrawal  occurred.  For example,  if your
     Highest  Anniversary  Value is $125,000 and you  subsequently  withdraw  $10,000 at a time when your Account  Value is equal to
     $100,000 (a 10%  reduction),  when  calculating  the  optional  Death  Benefit we will reduce your  Highest  Anniversary  Value
     ($125,000) by 10% or $12,500.

Calculation of Highest Anniversary Value Death Benefit
The Highest Anniversary Value Death Benefit depends on whether death occurs before or after the Death Benefit Target Date.

         If the Owner dies before the Death Benefit Target Date, the Death Benefit equals the greater of:

1.       the basic Death Benefit described above; and
2.       the Highest Anniversary Value as of the Owner's date of death.

         If the Owner dies on or after the Death Benefit Target Date, the Death Benefit equals the greater of:

1.       the basic Death Benefit described above; and
2.       the Highest  Anniversary  Value on the Death Benefit Target Date plus the sum of all Purchase  Payments less the sum of all
              proportional withdrawals since the Death Benefit Target Date.

The amount  determined  by this  calculation  is  increased by any Purchase  Payments  received  after the Owner's date of death and
decreased by any  proportional  withdrawals  since such date.  The amount  calculated  in Items 1 & 2 above (both before on or after
the Death Benefit Target Date) may be reduced by any Credits under certain circumstances.

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The Highest  Anniversary  Value Death  Benefit  described  above is currently  being  offered in those  jurisdictions  where we have
received regulatory approval.  Certain terms and conditions may differ between jurisdictions once approved.
- ------------------------------------------------------------------------------------------------------------------------------------

See Appendix C for examples of how the Highest Anniversary Value Death Benefit is calculated.

Annuities with joint Owners
For  Annuities  with Joint  Owners,  the Death  Benefit is  calculated as shown above except that the age of the oldest of the Joint
Owners is used to determine the Death Benefit  Target Date.  NOTE: If you and your spouse own the Annuity  jointly,  we will pay the
Death Benefit to the Beneficiary.  If the sole primary  Beneficiary is the surviving spouse,  then the surviving spouse can elect to
assume ownership of the Annuity and continue the contract instead of receiving the Death Benefit.

Annuities owned by entities
For  Annuities  owned by an entity,  the Death  Benefit is calculated as shown above except that the age of the Annuitant is used to
determine  the Death  Benefit  Target  Date.  Payment of the Death  Benefit is based on the death of the  Annuitant  (or  Contingent
Annuitant, if applicable).



Can I terminate the optional Death Benefits?  Do the optional Death Benefits terminate under other circumstances?
You can terminate the Enhanced  Beneficiary  Protection  Optional Death Benefit and Highest Anniversary Value Optional Death Benefit
at any time.  Both optional  Death  Benefits will  terminate  automatically  on the Annuity Date. We may also terminate any optional
Death Benefit if necessary to comply with our interpretation of the Code and applicable regulations.

What are the charges for the optional Death Benefits?
We deduct a charge equal to 0.25% per year,  respectively,  if you elect the Highest Anniversary Value Optional Death Benefit or the
Enhanced  Beneficiary  Protection  Optional Death Benefit.  If you elect both optional Death Benefits,  the total charge is equal to
0.50% per year.  We deduct the charge to  compensate  American  Skandia  for  providing  increased  insurance  protection  under the
optional Death Benefit.  The additional annual charge is deducted daily against your Account Value allocated to the Sub-accounts.

Please refer to the section entitled "Tax Considerations" for additional considerations in relation to the optional Death Benefit.

AMERICAN SKANDIA'S ANNUITY REWARDS

What is the Annuity Rewards benefit?
The Annuity  Rewards  benefit  offers  Owners the ability to capture  any market  gains since the Issue Date of their  Annuity as an
enhancement  to their  current Death Benefit so their  Beneficiaries  will not receive less than the Annuity's  value as of the date
the Owner elects the benefit.  Under the Annuity Rewards  benefit,  American  Skandia  guarantees that the Death Benefit will not be
less than:
         your Account Value in the variable  investment  options plus the Interim Value in any Fixed Allocations as of the effective
                  date of the Owner's election

         MINUS any proportional withdrawals* following the date of election
         -----

         PLUS any additional Purchase Payments applied to the Annuity following the date of election.
         ----

*    "Proportional  withdrawals" are determined by calculating the percentage of the Account Value that each withdrawal  represented
     when  withdrawn.  For example,  a withdrawal  of 50% of your  Account  Value would be treated as a 50%  reduction in the amount
     payable under the Death Benefit.

The Annuity  Rewards Death Benefit  enhancement  does not affect the basic Death Benefit  calculation or any Optional Death Benefits
available  under the Annuity.  If the Death Benefit amount  payable under your  Annuity's  basic Death Benefit or any Optional Death
Benefits you purchase is greater than the enhanced  Death  Benefit under the Annuity  Rewards  benefit on the date the Death Benefit
is calculated, your Beneficiary will receive the higher amount.

Who is eligible for the Annuity Rewards benefit?
Owners can elect the Annuity  Rewards  Death  Benefit  enhancement  following the tenth (10th)  anniversary  of the Annuity's  Issue
Date.  However,  the  election is subject to the  requirement  that their  Account  Value on the  election  date is greater than the
amount  that would be payable to their  Beneficiary  under the Death  Benefit  provided  under the Annuity as of the  election  date
(including  any amounts  payable  under the Highest  Anniversary  Value Death  Benefit).  If an Owner is  ineligible  when he or she
applies for the optional benefit,  the Owner can elect the Annuity Rewards Death Benefit  enhancement on any subsequent date if they
otherwise  qualify.  The election  must occur before  annuity  payments  begin.  An Owner can only elect the Annuity  Rewards  Death
Benefit enhancement once.  There is no additional charge for electing the Annuity Rewards Death Benefit enhancement.

PAYMENT OF DEATH BENEFITS

Payment of Death Benefit to Beneficiary
Except in the case of a spousal Beneficiary, in the event of your death, the death benefit must be distributed:
|X|      as a lump sum amount at any time within five (5) years of the date of death; or
|X|      as a series of annuity  payments  not  extending  beyond the life  expectancy  of the  Beneficiary  or over the life of the
         Beneficiary.  Payments under this option must begin within one year of the date of death.

Unless you have made an  election  prior to death  benefit  proceeds  becoming  due, a  Beneficiary  can elect to receive  the Death
Benefit  proceeds as a series of fixed annuity  payments  (annuity  payment options 1-4) or as a series of variable annuity payments
(annuity payment options 1-3 or 5 and 6).  See the section entitled "What Types of Annuity Options are Available."

Spousal Beneficiary - Assumption of Annuity
You may name your  spouse as your  Beneficiary.  If you and your  spouse own the Annuity  jointly,  we assume that the sole  primary
Beneficiary will be the surviving spouse unless you elect an alternative  Beneficiary  designation.  Unless you elect an alternative
Beneficiary  designation,  the spouse  Beneficiary may elect to assume  ownership of the Annuity instead of taking the Death Benefit
payment.  Any Death Benefit  (including any optional Death  Benefits)  that would have been payable to the  Beneficiary  will become
the new  Account  Value as of the date we receive due proof of death and any  required  proof of a spousal  relationship.  As of the
date the  assumption is  effective,  the  surviving  spouse will have all the rights and benefits that would be available  under the
Annuity to a new  purchaser of the same  attained  age.  For purposes of  determining  any future  Death  Benefit for the  surviving
spouse,  the new Account Value will be  considered as the initial  Purchase  Payment.  No CDSC will apply to the new Account  Value.
However,  any additional  Purchase  Payments applied after the date the assumption is effective will be subject to all provisions of
the Annuity, including any CDSC that may apply to the additional Purchase Payments.

See the section  entitled  "Managing  Your Annuity - Spousal  Contingent  Annuitant"  for a discussion of the treatment of a spousal
Contingent Annuitant in the case of the death of the Annuitant in an entity owned Annuity.

IRA Beneficiary Continuation Option
The Code  provides for  alternative  death benefit  payment  options when an Annuity is used as an IRA,  403(b) or other  "qualified
investment" that requires Minimum  Distributions.  Upon the Owner's death under an IRA, 403(b) or other  "qualified  investment",  a
Beneficiary  may generally elect to continue the Annuity and receive  Minimum  Distributions  under the Annuity instead of receiving
the death benefit in a single  payment.  The available  payment  options will depend on whether the Owner died on or before the date
he or she was required to begin receiving Minimum Distributions under the Code and whether the Beneficiary is the surviving spouse.

|X|      If death  occurs  before the date Minimum  Distributions  must begin under the Code,  the Death  Benefit can be paid out in
         either a lump  sum,  within  five  years  from the date of death,  or over the life or life  expectancy  of the  designated
         Beneficiary  (as long as payments begin by December 31st of the year following the year of death).  However,  if the spouse
         is the  Beneficiary,  the Death  Benefit can be paid out over the life or life  expectancy of the spouse with such payments
         beginning no earlier than December  31st of the year  following the year of death or December 31st of the year in which the
         deceased would have reached age 70 1/2, which ever is later.

|X|      If death occurs  after the date  Minimum  Distributions  must begin under the Code,  the Death  Benefit must be paid out at
         least as rapidly as under the method then in effect.

A Beneficiary has the flexibility to take out more each year than required under the Minimum  Distribution  rules.  Until withdrawn,
amounts in an IRA,  403(b) or other  "qualified  investment"  continue to be tax deferred.  Amounts  withdrawn each year,  including
amounts  that are  required to be  withdrawn  under the Minimum  Distribution  rules,  are subject to tax. You may wish to consult a
professional  tax advisor for tax advice as to your  particular  situation.  See the section  entitled "How are  Distributions  From
Qualified Contracts Taxed? - Minimum Distributions after age 70 1/2."

Upon election of this IRA Beneficiary Continuation option:

|X|      the Annuity contract will be continued in the Owner's name, for the benefit of the Beneficiary.
|X|      the Account Value will be equal to any Death Benefit  (including  any optional  Death Benefit) that would have been payable
              to the Beneficiary if they had taken a lump sum distribution.
|X|      the Beneficiary may request  transfers among  Sub-accounts,  subject to the same limitations and restrictions  that applied
              to the Owner.  NOTE: The Sub-accounts offered under the IRA Beneficiary Continuation option may be limited.
|X|      no additional Purchase Payments can be applied to the Annuity.
|X|      the basic Death Benefit and any optional Death Benefits elected by the Owner will no longer apply to the Beneficiary.
|X|      the  Beneficiary  can request a withdrawal  of all or a portion of the Account Value at any time without  application  of a
              CDSC.
|X|      upon the death of the  Beneficiary,  any remaining  Account Value will be paid in a lump sum to the person(s)  named by the
              Beneficiary.
|X|      all amounts in the Annuity  must be paid out to the  Beneficiary  according  to the Minimum  Distribution  rules  described
              above.

Please contact American Skandia for additional  information on the  availability,  restrictions and limitations that will apply to a
Beneficiary under the IRA Beneficiary Continuation option.

Are there any exceptions to these rules for paying the Death Benefit?
Yes,  there are exceptions  that apply no matter how your Death Benefit is calculated.  There are exceptions to the Death Benefit if
the  decedent  was not the Owner or  Annuitant  as of the Issue  Date and did not  become  the Owner or  Annuitant  due to the prior
Owner's or  Annuitant's  death.  Any Death Benefit  (including  either  optional Death Benefit) that applies will be suspended for a
two-year  period from the date he or she first became Owner or Annuitant.  After the two-year  suspension  period is completed,  the
Death Benefit is the same as if this person had been an Owner or Annuitant on the Issue Date.



When do you determine the Death Benefit?
We  determine  the amount of the Death  Benefit as of the date we receive  "due  proof of  death",  any  instructions  we require to
determine  the method of payment and any other  written  representations  we require to  determine  the proper  payment of the Death
Benefit to all  Beneficiaries.  "Due proof of death" may  include a certified  copy of a death  certificate,  a certified  copy of a
decree of a court of competent  jurisdiction as to the finding of death or other  satisfactory  proof of death.  Upon our receipt of
"due proof of death" we  automatically  transfer the Death Benefit to the AST Money Market  Sub-account  until we further  determine
the universe of eligible  Beneficiaries.  Once the universe of eligible  Beneficiaries has been determined each eligible Beneficiary
may allocate his or her eligible share of the Death Benefit to the Sub-accounts according to our rules.

Each  Beneficiary  must make an  election  as to the method  they wish to receive  their  portion  of the Death  Benefit.  Absent an
election  of a  Death  Benefit  payment  method,  no  Death  Benefit  can  be  paid  to the  Beneficiary.  We  may  require  written
acknowledgment  of all named  Beneficiaries  before we can pay the Death Benefit.  During the period from the date of death until we
receive all required paper work, the amount of the Death Benefit may be subject to market fluctuations.


VALUING YOUR INVESTMENT

HOW IS MY ACCOUNT VALUE DETERMINED?
During the accumulation  period,  the Annuity has an Account Value. The Account Value is determined  separately for each Sub-account
allocation and for each Fixed  Allocation.  The Account Value is the sum of the values of each Sub-account  allocation and the value
of each Fixed  Allocation.  The Account  Value does not reflect any CDSC that may apply to a withdrawal  or  surrender.  The Account
Value includes any Credits we applied to your Purchase  Payments that we are entitled to recover under certain  circumstances.  When
determining  the Account  Value on any day other than 30 days prior to a Fixed  Allocation's  Maturity  Date,  the Account Value may
include any Market Value Adjustment that would apply to a Fixed Allocation (if withdrawn or transferred) on that day.

WHAT IS THE SURRENDER VALUE OF MY ANNUITY?
The Surrender Value of your Annuity is the value  available to you on any day during the  accumulation  period.  The Surrender Value
is equal to your Account Value minus any CDSC, the Annual  Maintenance Fee and the charge for any optional  benefits.  The Surrender
Value will also include any Market Value Adjustment that may apply.

HOW AND WHEN DO YOU VALUE THE SUB-ACCOUNTS?
When you  allocate  Account  Value  to a  Sub-account,  you are  purchasing  units  of the  Sub-account.  Each  Sub-account  invests
exclusively  in  shares  of an  underlying  Portfolio.  The  value of the  Units  fluctuates  with the  market  fluctuations  of the
Portfolios.  The value of the Units  also  reflects  the daily  accrual  for the  Insurance  Charge and if you  elected  one or more
optional  benefits  whose annual  charge is deducted  daily,  the  additional  charge made for such  benefits.  There may be several
different  Unit Prices for each  Sub-account  to reflect the Insurance  Charge and the charges for any optional  benefits.  The Unit
Price for the Units you purchase will be based on the total  charges for the benefits  that apply to your  Annuity.  See the section
entitled  "What Happens to My Units When There is a Change in Daily  Asset-Based  Charges?"  for a detailed  discussion of how Units
are purchased and redeemed to reflect changes in the daily charges that apply to your Annuity.

Each  Valuation  Day, we determine  the price for a Unit of each  Sub-account,  called the "Unit  Price." The Unit Price is used for
determining  the value of  transactions  involving  Units of the  Sub-accounts.  We  determine  the number of Units  involved in any
transaction by dividing the dollar value of the transaction by the Unit Price of the Sub-account as of the Valuation Day.

Example
Assume you allocate  $5,000 to a Sub-account.  On the Valuation Day you make the allocation,  the Unit Price is $14.83.  Your $5,000
buys  337.154  Units of the  Sub-account.  Assume  that  later,  you wish to  transfer  $3,000  of your  Account  Value  out of that
Sub-account  and  into  another  Sub-account.  On the  Valuation  Day you  request  the  transfer,  the Unit  Price of the  original
Sub-account  has  increased to $16.79.  To transfer  $3,000,  we sell 178.677  Units at the current Unit Price,  leaving you 158.477
Units.  We then buy $3,000 of Units of the new  Sub-account  at the Unit Price of $17.83.  You would then have 168.255  Units of the
new Sub-account.

HOW DO YOU VALUE FIXED ALLOCATIONS?
During the Guarantee  Period,  we use the concept of an Interim  Value.  The Interim Value can be calculated on any day and is equal
to the initial value allocated to a Fixed  Allocation plus all interest  credited to a Fixed  Allocation as of the date  calculated.
The Interim  Value does not include the impact of any Market  Value  Adjustment.  If you made any  transfers or  withdrawals  from a
Fixed  Allocation,  the Interim Value will reflect the withdrawal of those amounts and any interest credited to those amounts before
they were  withdrawn.  To determine  the Account Value of a Fixed  Allocation  on any day other than its Maturity  Date, we multiply
the Account Value of the Fixed Allocation times the Market Value Adjustment factor.

WHEN DO YOU PROCESS AND VALUE TRANSACTIONS?
American Skandia is generally open to process  financial  transactions on those days that the New York Stock Exchange (NYSE) is open
for  trading.  There  may be  circumstances  where  the NYSE  does not open on a  regularly  scheduled  date or time or closes at an
earlier time than scheduled  (normally  4:00 p.m. EST).  Financial  transactions  requested  before the close of the NYSE which meet
our requirements will be processed according to the value next determined  following the close of business.  Financial  transactions
requested  on a  non-business  day or after the close of the NYSE will be  processed  based on the value next  computed  on the next
business  day.  There may be  circumstances  when the  opening or closing  time of the NYSE is  different  than  other  major  stock
exchanges,  such as NASDAQ or the  American  Stock  Exchange.  Under such  circumstances,  the closing time of the NYSE will be used
when valuing and processing transactions.

There may be circumstances  where the NYSE is open,  however,  due to inclement  weather,  natural  disaster or other  circumstances
beyond  our  control,  our  offices  may  be  closed  or  our  business  processing  capabilities  may be  restricted.  Under  those
circumstances,  your Account Value may fluctuate  based on changes in the Unit Values,  but you may not be able to transfer  Account
Value, or make a purchase or redemption request.

The NYSE is closed on the following nationally  recognized  holidays:  New Year's Day, Martin Luther King, Jr. Day, Presidents' Day,
Good Friday,  Memorial Day,  Independence  Day,  Labor Day,  Thanksgiving,  and Christmas.  On those dates,  we will not process any
financial transactions involving purchase or redemption orders.

American Skandia will also not process financial transactions involving purchase or redemption orders or transfers on any day that:
|X|      trading on the NYSE is restricted;
|X|      an emergency exists making redemption or valuation of securities held in the separate account impractical; or
|X|      the SEC, by order, permits the suspension or postponement for the protection of security holders.

Initial  Purchase  Payments:  We are required to allocate  your initial  Purchase  Payment to the  Sub-accounts  within two (2) days
after we receive  all of our  requirements  to issue the  Annuity.  If we do not have all the  required  information  to allow us to
issue your  Annuity,  we may retain  the  Purchase  Payment  while we try to reach you or your  representative  to obtain all of our
requirements.  If we are unable to obtain all of our  required  information  within  five (5) days,  we are  required  to return the
Purchase Payment at that time,  unless you  specifically  consent to our retaining the Purchase Payment while we gather the required
information.  Once we obtain the  required  information,  we will invest the Purchase  Payment and issue the Annuity  within two (2)
days.  During any period that we are trying to obtain the required information, your money is not invested.

Additional  Purchase  Payments:  We will apply any  additional  Purchase  Payments on the Valuation Day that we receive the Purchase
Payment with satisfactory allocation instructions.

Scheduled  Transactions:  "Scheduled"  transactions  include  transfers  under  a  Dollar  Cost  Averaging,  rebalancing,  or  asset
allocation program,  Systematic  Withdrawals,  Minimum Distributions or annuity payments.  Scheduled  transactions are processed and
valued as of the date they are scheduled,  unless the scheduled day is not a Valuation Day. In that case,  the  transaction  will be
processed and valued on Valuation Day prior to the scheduled transaction date.

Unscheduled  Transactions:   "Unscheduled"  transactions  include  any  other  non-scheduled  transfers  and  requests  for  Partial
Withdrawals  or Free  Withdrawals  or  Surrenders.  Unscheduled  transactions  are  processed  and valued as of the Valuation Day we
receive the request at our Office and have all of the required information.

Medically-related  Surrenders & Death  Benefits:  Medically-related  surrender  requests and Death Benefit claims require our review
and evaluation before  processing.  We price such transactions as of the date we receive at our Office all supporting  documentation
we require for such transactions and that are satisfactory to us.

Transactions in ProFunds VP Sub-accounts:  Generally,  purchase or redemption  orders or transfer requests must be received by us by
no later than the close of the NYSE to be processed on the current  Valuation  Day.  However,  any purchase or  redemption  order or
transfer  request  involving  the  ProFunds VP  Sub-accounts  must be  received by us no later than one hour prior to any  announced
closing of the applicable  securities  exchange  (generally,  3:00 p.m. Eastern time) to be processed on the current  Valuation Day.
The "cut-off"  time for such  financial  transactions  involving a ProFunds VP  Sub-account  will be extended to1/2hour prior to any
announced  closing  (generally,  3:30 p.m.  Eastern time) for  transactions  submitted  electronically  through  American  Skandia's
Internet  website  (www.americanskandia.prudential.com).  You cannot  request a transaction  involving  the purchase,  redemption or
transfer  of Units in one of the  ProFunds  VP  Sub-accounts  between  the  applicable  "cut-off"  time and 4:00  p.m.  Transactions
received after 4:00 p.m. will be treated as received by us on the next Valuation Day.



WHAT HAPPENS TO MY UNITS WHEN THERE IS A CHANGE IN DAILY ASSET-BASED CHARGES?

Distribution  Charge:  The  Distribution  Charge is deducted  under your Annuity  during  Annuity Years 1-10. At the end of the 10th
Annuity  Year,  we will no longer  deduct the  Distribution  Charge.  On the date the charge no longer  applies,  your  Annuity will
become subject to a different  daily  asset-based  charge.  We will process a transaction  where your Account Value allocated to the
Sub-accounts  will be used to purchase  new Units of the  Sub-accounts  that  reflect the  Insurance  Charge (and the charge for any
optional  benefits  you have  elected)  but not the  Distribution  Charge.  The number of Units  attributed  to your Annuity will be
decreased  and the Unit Price of each unit of the  Sub-accounts  in which you invested  will be  increased.  The  adjustment  in the
number of Units and Unit Price will not affect your Account  Value.  Beginning on that date,  your Account  Value will be determined
based on the change in the value of Units that reflect the Insurance Charge and any other optional benefits that you have elected.

Termination  of Optional  Benefits:  Except for the  Guaranteed  Minimum Income Benefit which cannot be terminated by the owner once
elected,  if you  terminate  any other  optional  benefit,  we will no longer  deduct the charge we apply to purchase  the  optional
benefit.  On the date the charge no longer applies,  your Annuity will become subject to a different daily  asset-based  charge.  We
will  process a  transaction  where your  Account  Value  allocated  to the  Sub-accounts  will be used to purchase new Units of the
Sub-accounts  that reflect the Insurance Charge,  the Distribution  Charge (if applicable) and any optional benefit or program still
elected,  but not the charge  for the  optional  benefit or program  that you  terminated.  The number of Units  attributed  to your
Annuity  will be  decreased  and the Unit  Price of each unit of the  Sub-accounts  in which you  invested  will be  increased.  The
adjustment  in the number of Units and Unit Price will not affect your Account  Value.  Beginning on that date,  your Account  Value
will be  determined  based on the change in the value of Units that  reflect  the  Insurance  Charge,  the  Distribution  Charge (if
applicable) and any other optional benefits that you have elected.

TAX CONSIDERATIONS

WHAT ARE SOME OF THE FEDERAL TAX CONSIDERATIONS OF THIS ANNUITY?
Following is a brief summary of some of the Federal tax  considerations  relating to this Annuity.  However,  since the tax laws are
complex and tax consequences are affected by your individual  circumstances,  this summary of our interpretation of the relevant tax
laws is not  intended  to be  fully  comprehensive  nor is it  intended  as tax  advice.  Therefore,  you  may  wish  to  consult  a
professional tax advisor for tax advice as to your particular situation.

HOW ARE AMERICAN SKANDIA AND THE SEPARATE ACCOUNTS TAXED?
The Separate  Accounts are taxed as part of American  Skandia.  American Skandia is taxed as a life insurance  company under Part I,
subchapter  L of the Code.  No taxes are due on  interest,  dividends  and  short-term  or  long-term  capital  gains  earned by the
Separate Accounts with respect to the Annuities.

IN GENERAL, HOW ARE ANNUITIES TAXED?
Section 72 of the Code governs the taxation of annuities in general.  Taxation of the Annuity will depend in large part on:

1.       whether the Annuity is used by:
|X|      a qualified  pension plan,  profit  sharing plan or other  retirement  arrangement  that is eligible for special  treatment
         under the Code (for purposes of this discussion, a "Qualified Contract"); or
|X|      an individual or a corporation, trust or partnership (a "Non-qualified Contract"); and

2.       whether the Owner is:
|X|      an individual person or persons; or
|X|      an entity including a corporation, trust or partnership.

Individual  Ownership:  If one or more  individuals own an Annuity,  the Owner of the Annuity is generally not taxed on any increase
in the value of the Annuity  until an amount is received (a  "distribution").  This is  commonly  referred to as "tax  deferral".  A
distribution  can be in the form of a lump sum payment  including  payment of a Death Benefit,  or in annuity  payments under one of
the annuity payment options.  Certain other transactions may qualify as a distribution and be subject to taxation.

Entity  Ownership:  If the Annuity is owned by an entity and is not a Qualified  Contract,  generally  the Owner of the Annuity must
currently  include  any  increase in the value of the Annuity  during a tax year in its gross  income.  An  exception  from  current
taxation  applies for annuities held by an employer with respect to a terminated  tax-qualified  retirement plan, a trust holding an
annuity as an agent for a natural  person,  or by a decedent's  estate by reason of the death of the decedent.  A tax-exempt  entity
for Federal tax purposes may not be subject to income tax as a result of this provision.



HOW ARE DISTRIBUTIONS TAXED?
Distributions from an Annuity are taxed as ordinary income and not as capital gains.

Distributions  Before  Annuitization:  Distributions  received before annuity  payments begin are generally  treated as coming first
from "income on the contract" and then as a return of the  "investment  in the  contract".  The amount of any  distribution  that is
treated  as receipt of  "income  on the  contract"  is  includible  in the  taxpayer's  gross  income and  taxable in the year it is
received.  The amount of any  distribution  treated as a return of the  "investment  in the  contract"  is not  includible  in gross
income.

|X|      "Income on the  contract" is calculated by  subtracting  the  taxpayer's  "investment  in the contract"  from the aggregate
     value of all "related contracts" (discussed below).
|X|      "Investment  in the  contract"  is equal to  total  purchase  payments  for all  "related  contracts"  minus  any  previous
     distributions  or portions of such  distributions  from such  "related  contracts"  that were not  includible  in gross income.
     "Investment  in the  contract"  may be affected by whether an annuity or any  "related  contract"  was  purchased  as part of a
     tax-free  exchange of life insurance,  endowment,  or annuity  contracts under Section 1035 of the Code. The "investment in the
     contract" for a Qualified Contract will be considered zero for tax reporting purposes.

Distributions  After  Annuitization:  A portion of each  annuity  payment  received on or after the Annuity  Date will  generally be
taxable.  The taxable  portion of each annuity  payment is determined by a formula which  establishes the ratio that the "investment
in the contract"  bears to the total value of annuity  payments to be made.  This is called the  "exclusion  ratio." The  investment
in the contract is excluded  from gross income.  Any portion of an annuity  payment  received that exceeds the exclusion  ratio will
be entirely  includible  in gross  income.  The formula for  determining  the  exclusion  ratio  differs  between fixed and variable
annuity  payments.  When annuity  payments  cease  because of the death of the person upon whose life  payments are based and, as of
the date of death,  the  amount of  annuity  payments  excluded  from  taxable  income by the  exclusion  ratio  does not exceed the
"investment in the contract," then the remaining  portion of unrecovered  investment may be allowed as a deduction on the decedent's
final income tax return.

Penalty Tax on  Distributions:  Generally,  any  distribution  from an annuity  not used in  conjunction  with a Qualified  Contract
(Qualified  Contracts are  discussed  below) is subject to a penalty  equal to 10% of the amount  includible  in gross income.  This
penalty does not apply to certain distributions, including:
|X|      Distributions made on or after the taxpayer has attained age 591/2;
|X|      Distributions made on or after the death of the contract owner, or, if the owner is an entity, the death of the annuitant;
|X|      Distributions attributable to the taxpayer's becoming disabled within the meaning of Code section 72(m)(7);
|X|      Distributions  which are part of a series of  substantially  equal periodic  payments for the life (or life  expectancy) of
     the taxpayer or the joint lives (or joint life expectancies) of the taxpayer and the taxpayer's designated beneficiary;
|X|      Distributions of amounts which are treated as "investments in the contract" made prior to August 14, 1982;
|X|      Payments under an immediate annuity as defined in the Code;
|X|      Distributions under a qualified funding asset under Code Section 130(d); or
|X|      Distributions  from an annuity  purchased by an employer on the termination of a qualified pension plan that is held by the
     employer until the employee separates from service.

Special rules  applicable to "related  contracts":  Contracts  issued by the same insurer to the same contract owner within the same
calendar year (other than certain  contracts owned in connection with a tax-qualified  retirement  arrangement) are to be treated as
one annuity contract when determining the taxation of distributions  before  annuitization.  We refer to these contracts as "related
contracts."  In situations  involving  related  contracts we believe that the values under such  contracts and the investment in the
contracts  will be added  together to determine the proper  taxation of a  distribution  from any one contract  described  under the
section  "Distributions  before  Annuitization."  Generally,  distributions  will be  treated  as coming  first  from  income on the
contract  until all of the  income on all such  related  contracts  is  withdrawn,  and then as a return  of the  investment  in the
contract.  There is some uncertainty  regarding the manner in which the Internal  Revenue Service would view related  contracts when
one or more  contracts are immediate  annuities or are contracts that have been  annuitized.  The Internal  Revenue  Service has not
issued guidance  clarifying this issue as of the date of this Prospectus.  You are  particularly  cautioned to seek advice from your
own tax advisor on this matter.

Special  concerns  regarding  "substantially  equal  periodic  payments":  (also  known as  "72(t)" or  "72(q)"  distributions)  Any
modification to a program of  distributions  which are part of a series of substantially  equal periodic  payments that occur before
the later of the taxpayer  reaching age 59 1/2or five (5) years from the first of such payments will result in the  requirement to pay
the 10%  premature  distribution  penalty  that would have been due had the payments  been  treated as subject to the 10%  premature
distribution  penalty in the years  received,  plus  interest.  This does not apply when the  modification  is by reason of death or
disability.  American Skandia does not currently support a section 72(q) program.



Special concerns regarding immediate  annuities:  The Internal Revenue Service has ruled that the immediate annuity exception to the
10% penalty described above under "Penalty Tax on Distributions" for  "non-qualified"  immediate annuities as defined under the Code
may not apply to annuity payments under a contract  recognized as an immediate  annuity under state insurance law obtained  pursuant
to an exchange of a contract if: (a) purchase  payments for the exchanged  contract  were  contributed  or deemed to be  contributed
more than one year  prior to the  annuity  starting  date  under the  immediate  annuity;  and (b) the  annuity  payments  under the
immediate annuity do not meet the requirements of any other exception to the 10% penalty.

Special rules in relation to tax-free  exchanges under Section 1035:  Section 1035 of the Code permits certain tax-free exchanges of
a life insurance,  annuity or endowment  contract for an annuity.  If an annuity is purchased  through a tax-free exchange of a life
insurance,  annuity or endowment contract that was purchased prior to August 14, 1982, then any distributions  other than as annuity
payments will be considered to come:
|X|      First, from the amount of "investment in the contract" made prior to August 14, 1982 and exchanged into the annuity;
|X|      Then,  from any "income on the  contract"  that is  attributable  to the  purchase  payments  made prior to August 14, 1982
       (including income on such original purchase payments after the exchange);
|X|      Then, from any remaining "income on the contract"; and
|X|      Lastly, from the amount of any "investment in the contract" made after August 13, 1982.

Therefore,  to the extent a distribution is equal to or less than the remaining  investment in the contract made prior to August 14,
1982,  such amounts are not included in taxable  income.  Further,  distributions  received  that are  considered  to be a return of
investment on the contract from purchase  payments made prior to August 14, 1982, such  distributions are not subject to the 10% tax
penalty.  In all other respects,  the general  provisions of the Code apply to distributions from annuities obtained as part of such
an exchange.

Partial  surrenders  may be treated in the same way as tax-free  1035  exchanges of entire  contracts,  therefore  avoiding  current
taxation  of any gains in the  contract  as well as the 10% IRS tax penalty on pre-age 59 1/2withdrawals.  The IRS has  reserved  the
right to treat  transactions it considers abusive as ineligible for this favorable partial 1035 exchange  treatment.  We do not know
what transactions may be considered  abusive.  For example,  we do not know how the IRS may view early withdrawals or annuitizations
after a  partial  exchange.  As of the  date of this  prospectus,  we will  treat a  partial  surrender  of this  type  involving  a
non-qualified  annuity  contract as a "tax-free"  exchange  for future tax  reporting  purposes,  except to the extent that we, as a
reporting and withholding agent,  believe that we would be expected to deem the transaction to be abusive.  However,  some insurance
companies may not recognize  these partial  surrenders  as tax-free  exchanges and may report them as taxable  distributions  to the
extent of any gain  distributed  as well as subjecting the taxable  portion of the  distribution  to the 10% IRS early  distribution
penalty.  We  strongly  urge you to  discuss  any  transaction  of this  type  with  your tax  advisor  before  proceeding  with the
transaction.

There is no guidance from the Internal Revenue Service as to whether a partial  exchange from a life insurance  contract is eligible
for  non-recognition  treatment  under Section 1035 of the Code. We will continue to report a partial  surrender of a life insurance
policy as subject to current  taxation to the extent of any gain.  In addition,  please be cautioned  that no specific  guidance has
been provided as to the impact of such a transaction  on the remaining  life  insurance  policy,  particularly  as to the subsequent
methods  to be used to test for  compliance  under  the Code for both the  definition  of life  insurance  and the  definition  of a
modified endowment contract.

Special  Considerations  for  Purchasers of the Enhanced  Beneficiary  Protection  Optional  Death  Benefit:  As of the date of this
Prospectus,  it is our understanding  that the charges related to the optional Death Benefit are not subject to current taxation and
we will not  report  them as such.  However,  the IRS could  take the  position  that  these  charges  should be  treated as partial
withdrawals  subject to current  taxation to the extent of any gain and, if  applicable,  the 10% tax penalty.  We reserve the right
to report charges for the optional Death Benefit as partial  withdrawals if we, as a reporting and withholding  agent,  believe that
we would be expected to report them as such.

WHAT TAX CONSIDERATIONS ARE THERE FOR TAX-QUALIFIED RETIREMENT PLANS OR QUALIFIED CONTRACTS?
An annuity may be suitable as a funding vehicle for various types of  tax-qualified  retirement  plans.  We have provided  summaries
below of the  types of  tax-qualified  retirement  plans  with  which we may  issue an  Annuity.  These  summaries  provide  general
information  about the tax rules and are not  intended to be  complete  discussions.  The tax rules  regarding  qualified  plans are
complex.  These rules may include limitations on contributions and restrictions on distributions,  including  additional taxation of
distributions  and  additional  penalties.  The  terms  and  conditions  of the  tax-qualified  retirement  plan  may  impose  other
limitations  and  restrictions  that are in  addition  to the terms of the  Annuity.  The  application  of these  rules  depends  on
individual  facts and  circumstances.  Before  purchasing an Annuity for use in a qualified  plan,  you should obtain  competent tax
advice,  both as to the tax treatment and  suitability of such an investment.  American  Skandia does not offer all of its annuities
to all of these types of tax-qualified retirement plans.

Economic Growth and Tax Relief  Reconciliation  Act (EGTRRA):  Certain states do not conform to the pension  provisions  included in
EGTRRA.  We  recommend  that you consult with your tax advisor to  determine  the status of your state's  statutes as they relate to
EGTRRA and your tax qualified retirement plan.

Corporate  Pension and  Profit-sharing  Plans:  Annuities may be used to fund  employee  benefits of various  corporate  pension and
profit-sharing  plans  established by corporate  employers  under Section 401(a) of the Code including  401(k) plans.  Contributions
to such plans are not taxable to the employee until  distributions  are made from the retirement plan. The Code imposes  limitations
on the amount that may be contributed  and the timing of  distributions.  The tax treatment of  distributions  is subject to special
provisions of the Code, and also depends on the design of the specific  retirement plan.  There are also special  requirements as to
participation, nondiscrimination, vesting and nonforfeitability of interests.

H.R. 10 Plans:  Annuities  may also be used to fund  benefits of retirement  plans  established  by  self-employed  individuals  for
themselves and their  employees.  These are commonly  known as "H.R. 10 Plans" or "Keogh Plans".  These plans are subject to most of
the same types of limitations and  requirements as retirement  plans  established by corporations.  However,  the exact  limitations
and requirements may differ from those for corporate plans.

Tax Sheltered  Annuities:  Under Section 403(b) of the Code, a tax sheltered annuity ("TSA") is a contract into which  contributions
may be  made  by  certain  qualifying  employers  such  as  public  schools  and  certain  charitable,  educational  and  scientific
organizations  specified  in Section  501(c)(3)  for the  benefit of their  employees.  Such  contributions  are not  taxable to the
employee  until  distributions  are made from the TSA.  The Code  imposes  limits on  contributions,  transfers  and  distributions.
Nondiscrimination requirements also apply.

Section 457 Plans:  Under Section 457 of the Code,  deferred  compensation  plans  established by governmental and certain other tax
exempt  employers  for their  employees  may invest in annuity  contracts.  The Code limits  contributions  and  distributions,  and
imposes  eligibility  requirements as well.  Contributions  are not taxable to employees until  distributed from the plan.  However,
plan assets  remain the  property of the  employer  and are subject to the claims of the  employer's  general  creditors  until such
assets are made available to participants or their beneficiaries.

Individual  Retirement  Arrangements  or "IRAs":  Section  408 of the Code allows  eligible  individuals  to maintain an  individual
retirement  account  or  individual  retirement  annuity  ("IRA").  IRAs  are  subject  to  limitations  on the  amount  that may be
contributed,  the  contributions  that may be deducted from taxable income,  the persons who may be eligible to establish an IRA and
the time when  distributions  must commence.  Further,  an Annuity may be established  with "roll-over"  distributions  from certain
tax-qualified retirement plans and maintain the tax-deferred status of these amounts.

Roth IRAs:  A form of IRA is also  available  called a "Roth  IRA".  Contributions  to a Roth IRA are not tax  deductible.  However,
distributions  from a Roth IRA are free from  Federal  income taxes and are not subject to the 10% penalty tax if five (5) tax years
have passed since the first  contribution  was made or any conversion from a traditional  IRA was made and the  distribution is made
                                                                                                       ---
(a) once the taxpayer is age 59 1/2or older,  (b) upon the death or disability of the taxpayer,  or (c) for qualified  first-time home
buyer expenses,  subject to certain  limitations.  Distributions  from a Roth IRA that are not "qualified" as described above may be
subject to Federal income and penalty taxes.

Purchasers  of IRAs and Roth  IRAs  will  receive a  special  disclosure  document,  which  describes  limitations  on  eligibility,
contributions,  transferability  and  distributions.  It also  describes  the  conditions  under which  distributions  from IRAs and
qualified  plans  may be  rolled  over or  transferred  into an IRA or  another  qualified  plan,  on a  tax-deferred  basis and the
conditions  under which  distributions  from  traditional IRAs may be rolled over to, or the traditional IRA itself may be converted
into, a Roth IRA.

SEP IRAs:  Eligible  employers  that meet  specified  criteria may  establish  Simplified  Employee  Pensions or SEP IRAs.  Employer
contributions  that may be made to employee SEP IRAs are larger than the amounts that may be  contributed  to other IRAs, and may be
deductible to the employer.

HOW ARE DISTRIBUTIONS FROM QUALIFIED CONTRACTS TAXED?
Distributions  from  Qualified  Contracts are generally  taxed under  Section 72 of the Code.  Under these rules,  a portion of each
distribution  may be excludable  from income.  The  excludable  amount is the proportion of a  distribution  representing  after-tax
contributions.  Generally,  a 10% penalty tax applies to the taxable portion of a distribution from a Qualified  Contract made prior
to age 59 1/2.  However, the 10% penalty tax does not apply when the distribution:
|X|      is part of a properly executed transfer to another IRA or another eligible qualified account;
|X|      is subsequent to the death or  disability  of the taxpayer (for this purpose  disability is as defined in Section  72(m)(7)
     of the Code);
|X|      is part of a series  of  substantially  equal  periodic  payments  to be paid not less  frequently  than  annually  for the
     taxpayer's life or life expectancy or for the joint lives or life expectancies of the taxpayer and a designated beneficiary;
|X|      is subsequent to a separation from service after the taxpayer attains age 55*;
|X|      does not exceed the employee's allowable deduction in that tax year for medical care;
|X|      is made to an alternate payee pursuant to a qualified domestic relations order*;
|X|      is made pursuant to an IRS levy;
|X|      is made to pay qualified acquisition costs for a first time home purchase (IRA only);
|X|      is made to pay qualified higher education expenses (IRA only); and
|X|      is not more than the cost of your medical insurance (IRA only).

The exceptions above which are followed by an asterisk (*) do not apply to IRAs.  Certain other exceptions may be available.

Minimum  Distributions  after age 70 1/2: A participant's  interest in a Qualified Contract must generally be distributed,  or begin to
be distributed, by the "required beginning date".  This is April 1st of the calendar year following the later of:
|X|      the calendar year in which the individual attains age 70 1/2; or
|X|      the calendar  year in which the  individual  retires from service with the employer  sponsoring  the plan.  The  retirement
      option is not available to IRAs.

The IRS has released Treasury  regulations  containing new Minimum  Distribution rules. For Minimum  Distributions  required in 2003
and later,  individuals  are  required  to use the rules  under the 2002 Final  Regulations.  The 2002 Final  Regulations  contain a
provision  which  could  increase  the  amount of minimum  distributions  required  for  certain  individuals.  Under the 2002 Final
Regulations,  individuals  are required to include in their annuity  contract  value the actuarial  value of any other benefits that
will be provided  under the annuity.  We and other annuity  providers  are currently  seeking  clarification  of this new rule.  You
should consult your tax adviser to determine the impact of this rule on your Minimum Distributions.

Under the new Minimum  Distribution  rules, a uniform life expectancy table will be utilized by all participants except those with a
spouse who is more than ten (10)  years  younger  than the  participant.  In that case,  the new rules  permit  the  participant  to
utilize the actual life  expectancies of the participant  and the spouse.  In most cases,  the beneficiary may be changed during the
participant's  lifetime with no affect on the Minimum  Distributions.  At death,  the  designated  Beneficiary  may  generally  take
Minimum Distributions over his/her life expectancy or in a lump sum.

If the amount  distributed is less than the minimum  required  distribution for the year, the participant is subject to a 50% tax on
the amount that was not properly  distributed.  Because of the many recent changes to the Minimum  Distribution  rules,  we strongly
encourage you to consult with your tax advisor for more detailed information.

GENERAL TAX CONSIDERATIONS

Diversification:  Section  817(h) of the Code provides that a variable  annuity  contract,  in order to qualify as an annuity,  must
have an "adequately  diversified"  segregated asset account (including  investments in a mutual fund by the segregated asset account
of  insurance  companies).  If the  diversification  requirements  under the Code are not met and the  annuity is not  treated as an
annuity,  the  taxpayer  will be subject to income tax on the annual gain in the  contract.  The Treasury  Department's  regulations
prescribe the  diversification  requirements  for variable  annuity  contracts.  We expect the underlying  mutual fund portfolios to
comply with the terms of these regulations.

Transfers Between Investment  Options:  Transfers between investment  options are not subject to taxation.  The Treasury  Department
may  promulgate  guidelines  under  which a variable  annuity  will not be treated as an annuity for tax  purposes  if persons  with
ownership  rights have excessive  control over the  investments  underlying  such variable  annuity.  Such guidelines may or may not
address the number of investment  options or the number of transfers  between  investment  options offered under a variable annuity.
It is not known whether such guidelines,  if in fact promulgated,  would have retroactive  effect. It is also not known what effect,
if any, such guidelines may have on transfers  between the investment  options of the Annuity offered  pursuant to this  Prospectus.
We will take any action,  including  modifications to your Annuity or the  Sub-accounts,  required to comply with such guidelines if
promulgated.

Federal  Income Tax  Withholding:  Section  3405 of the Code  provides  for  Federal  income  tax  withholding  on the  portion of a
distribution  which is  includible  in the gross  income of the  recipient.  Amounts to be  withheld  depend  upon the nature of the
distribution.  However,  under most  circumstances  a recipient  may elect not to have income  taxes  withheld or have income  taxes
withheld at a different rate by filing a completed election form with us.

Certain  distributions,  known as  eligible  rollover  distributions,  from  Qualified  Contracts,  are  subject  to  automatic  20%
withholding for Federal income taxes. The following  distributions  are not eligible  rollover  distributions and not subject to 20%
withholding:
|X|      any portion of a distribution paid as a Minimum Distribution;
|X|      direct transfers to the trustee of another retirement plan;
|X|      distributions from an individual retirement account or individual retirement annuity;
|X|      distributions  made as  substantially  equal periodic  payments for the life or life  expectancy of the  participant in the
     retirement plan or the life or life expectancy of such participant and his or her designated beneficiary under such plan;
|X|      distributions  that are part of a series of substantial  periodic  payments pursuant to Section 72(q) or 72(t) of the Code;
     and
|X|      certain other distributions where automatic 20% withholding may not apply.

Loans,  Assignments  and Pledges:  Any amount  received  directly or indirectly  as a loan from, or any  assignment or pledge of any
portion of the value of, an annuity  before annuity  payments have begun is treated as a distribution  subject to taxation under the
distribution  rules set forth  above.  Any gain in an annuity on or after the  assignment  or pledge of an entire  annuity and while
such  assignment  or pledge  remains  in effect is  treated as  "income  on the  contract"  in the year in which it is  earned.  For
annuities not issued as Qualified  Contracts,  the cost basis of the annuity is increased by the amount of any  assignment or pledge
includible  in gross  income.  The cost basis is not affected by any repayment of any loan for which the annuity is collateral or by
payment of any interest thereon.

Gifts:  The gift of an annuity to someone  other than the spouse of the owner (or former  spouse  incident to a divorce) is treated,
for income tax purposes, as a distribution.

Estate and Gift Tax  Considerations:  You should obtain  competent tax advice with respect to possible  federal and state estate and
gift tax consequences flowing from the ownership and transfer of annuities.

Generation-Skipping  Transfers:  Under the Code  certain  taxes may be due when all or part of an  annuity is  transferred  to, or a
death  benefit is paid to, an  individual  two or more  generations  younger than the  contract  holder.  These  generation-skipping
transfers  generally  include those subject to federal estate or gift tax rules.  There is an aggregate $1.1 million  exemption from
taxes for all such  transfers.  We may be required to determine  whether a  transaction  is a direct skip as defined in the Code and
the amount of the  resulting  tax. We will  deduct from your  Annuity or from any  applicable  payment  treated as a direct skip any
amount of tax we are required to pay.

Considerations  for Contingent  Annuitants:  There may be adverse tax consequences if a contingent  annuitant  succeeds an annuitant
when the Annuity is owned by a trust that is neither tax exempt nor  qualifies  for preferred  treatment  under certain  sections of
the Code.  In general,  the Code is designed  to prevent  indefinite  deferral  of tax.  Continuing  the benefit of tax  deferral by
naming one or more contingent  annuitants  when the Annuity is owned by a  non-qualified  trust might be deemed an attempt to extend
the tax deferral for an indefinite  period.  Therefore,  adverse tax treatment may depend on the terms of the trust, who is named as
contingent  annuitant,  as well as the  particular  facts and  circumstances.  You should  consult your tax advisor  before naming a
contingent annuitant if you expect to use an Annuity in such a fashion.

GENERAL INFORMATION

HOW WILL I RECEIVE STATEMENTS AND REPORTS?
We send any  statements  and reports  required by applicable  law or  regulation  to you at your last known  address of record.  You
should  therefore give us prompt notice of any address change.  We reserve the right, to the extent  permitted by law and subject to
your prior  consent,  to provide  any  prospectus,  prospectus  supplements,  confirmations,  statements  and  reports  required  by
applicable  law or  regulation  to you  through  our  Internet  Website  at  http://www.americanskandia.prudential.com  or any other
electronic  means,  including  diskettes  or CD ROMs.  We send a  confirmation  statement  to you each  time a  transaction  is made
affecting Account Value, such as making additional Purchase Payments,  transfers,  exchanges or withdrawals.  We also send quarterly
statements  detailing  the  activity  affecting  your  Annuity  during the  calendar  quarter.  We may confirm  regularly  scheduled
transactions,  such  as the  Annual  Maintenance  Fee,  systematic  withdrawals  (including  72(t)  payments  and  required  minimum
distributions),  bank drafting,  dollar cost averaging,  and static rebalancing,  in quarterly statements instead of confirming them
immediately.  You should review the  information in these  statements  carefully.  You may request  additional  reports.  We reserve
the right to charge up to $50 for each such additional report.

Any errors or  corrections  on  transactions  for your  Annuity  must be  reported to us at our Office as soon as possible to assure
proper accounting to your Annuity. For transactions that are confirmed  immediately,  we assume all transactions are accurate unless
you notify us otherwise  within 30 days from the date you receive the  confirmation.  For  transactions  that are first confirmed on
the quarterly  statement,  we assume all transactions are accurate unless you notify us within 30 days from the date you receive the
quarterly  statement.  All transactions  confirmed  immediately or by quarterly statement are deemed conclusive after the applicable
30-day  period.  We may also send an annual report and a semi-annual  report  containing  applicable  financial  statements  for the
Separate Account and the Portfolios,  as of December 31 and June 30, respectively,  to Owners or, with your prior consent, make such
documents available electronically through our Internet Website or other electronic means.

WHO IS AMERICAN SKANDIA?
American Skandia Life Assurance  Corporation  ("American  Skandia") is a stock life insurance  company domiciled in Connecticut with
licenses in all 50 states,  the District of Columbia and Puerto Rico.  American  Skandia is a  wholly-owned  subsidiary  of American
Skandia,  Inc.  ("ASI").  American Skandia markets its products to broker-dealers  and financial  planners through an internal field
marketing staff. In addition,  American Skandia markets through and in conjunction  with financial  institutions  such as banks that
are permitted directly, or through affiliates, to sell annuities.

American  Skandia is in the  business  of issuing  annuity  and life  insurance  products.  American  Skandia  currently  offers the
following  products:  (a) flexible premium deferred  annuities and single premium fixed deferred  annuities that are registered with
the SEC; (b) certain other fixed  deferred  annuities that are not  registered  with the SEC; (c) both fixed and variable  immediate
adjustable annuities; and (d) a single premium variable life insurance policy that is registered with the SEC.

Effective May 1, 2003,  Skandia U.S. Inc., the sole  shareholder of ASI, which is the parent of American  Skandia,  was purchased by
Prudential  Financial,  Inc.  Prudential  Financial is a New Jersey  insurance  holding  company whose  subsidiary  companies  serve
individual and institutional  customers worldwide and include The Prudential  Insurance Company of America,  one of the largest life
insurance  companies in the U.S. These  companies offer a variety of products and services,  including life insurance,  property and
casualty  insurance,  mutual funds,  annuities,  pension and  retirement  related  services and  administration,  asset  management,
securities brokerage, banking and trust services, real estate brokerage franchises, and relocation services.

No company  other than  American  Skandia has any legal  responsibility  to pay amounts  that it owes under its annuity and variable
life  insurance  contracts.  However,  following the closing of the  acquisition,  Prudential  Financial  will exercise  significant
influence over the operations and capital structure of American Skandia.

WHAT ARE SEPARATE ACCOUNTS?
The separate  accounts are where American  Skandia sets aside and invests the assets of some of our annuities.  In the  accumulation
period,  assets  supporting  Account Values of the Annuities are held in a separate account  established under the laws of the State
of Connecticut.  We are the legal owner of assets in the separate  accounts.  In the payout period,  assets supporting fixed annuity
payments  and any  adjustable  annuity  payments we make  available  are held in our general  account.  Assets  supporting  variable
annuity  payment  options  may be invested in our  separate  accounts.  Income,  gains and losses  from  assets  allocated  to these
separate  accounts are credited to or charged against each such separate account without regard to other income,  gains or losses of
American Skandia or of any other of our separate  accounts.  These assets may only be charged with liabilities  which arise from the
Annuities  issued by American  Skandia.  The amount of our obligation in relation to allocations to the Sub-accounts is based on the
investment performance of such Sub-accounts.  However, the obligations themselves are our general corporate obligations.

Separate Account B
During the accumulation  period, the assets supporting  obligations based on allocations to the variable investment options are held
in  Sub-accounts  of American  Skandia Life  Assurance  Corporation  Variable  Account B, also referred to as "Separate  Account B".
Separate  Account B was  established by us pursuant to Connecticut  law on November 25, 1987.  Separate  Account B also holds assets
of other annuities issued by us with values and benefits that vary according to the investment performance of Separate Account B.

Separate  Account B consists  of  multiple  Sub-accounts.  Each  Sub-account  invests  only in a single  mutual  fund or mutual fund
portfolio.  The name of each  Sub-account  generally  corresponds  to the name of the  underlying  Portfolio.  Each  Sub-account  in
Separate Account B may have several  different Unit Prices to reflect the Insurance  Charge,  Distribution  Charge (when applicable)
and the charges for any optional  benefits that are offered  under this Annuity and other  annuities  issued by us through  Separate
Account B. Separate Account B is registered with the SEC under the Investment  Company Act of 1940  ("Investment  Company Act") as a
unit  investment  trust,  which is a type of investment  company.  The SEC does not  supervise  investment  policies,  management or
practices of Separate Account B.

Prior to November 18, 2002,  Separate Account B was organized as a single separate account with six different  Sub-account  classes,
each of which was registered as a distinct unit  investment  trust under the Investment  Company Act.  Effective  November 18, 2002,
each Sub-account  class of Separate  Account B was consolidated  into the unit investment trust formerly named American Skandia Life
Assurance  Corporation  Variable  Account B (Class 1 Sub-accounts),  which was subsequently  renamed American Skandia Life Assurance
Corporation  Variable  Account B. Each  Sub-account  of Separate  Account B has  multiple  Unit  Prices to reflect the daily  charge
deducted for each combination of the applicable  Insurance  Charge,  Distribution  Charge (when  applicable) and the charge for each
optional benefit offered under Annuity  contracts  funded through  Separate  Account B. The  consolidation of Separate Account B had
no impact on Annuity Owners.

We reserve the right to make  changes to the  Sub-accounts  available  under the Annuity as we determine  appropriate.  We may offer
new  Sub-accounts,  eliminate  Sub-accounts,  or combine  Sub-accounts  at our sole  discretion.  We may also close  Sub-accounts to
additional  Purchase  Payments on existing Annuity  contracts or close  Sub-accounts  for Annuities  purchased on or after specified
dates.  We may also substitute an underlying  mutual fund or portfolio of an underlying  mutual fund for another  underlying  mutual
fund or  portfolio  of an  underlying  mutual fund,  subject to our receipt of any  exemptive  relief that we are required to obtain
under the Investment Company Act.  We will notify Owners of changes we make to the Sub-accounts available under the Annuity.

Values and benefits based on  allocations to the  Sub-accounts  will vary with the investment  performance of the underlying  mutual
funds or fund  portfolios,  as  applicable.  We do not  guarantee  the  investment  results of any  Sub-account.  Your Account Value
allocated  to the  Sub-accounts  may increase or  decrease.  You bear the entire  investment  risk.  There is no assurance  that the
Account Value of your Annuity will equal or be greater than the total of the Purchase Payments you make to us.

Separate Account D
During the  accumulation  period,  assets  supporting our obligations  based on Fixed  Allocations are held in American Skandia Life
Assurance  Corporation  Separate  Account D, also  referred to as  "Separate  Account D".  Such  obligations  are based on the fixed
interest  rates we credit to Fixed  Allocations  and the terms of the Annuities.  These  obligations do not depend on the investment
performance of the assets in Separate Account D.  Separate Account D was established by us pursuant to Connecticut law.

There are no units in Separate  Account D. The Fixed  Allocations  are  guaranteed  by our  general  account.  An Annuity  Owner who
allocates a portion of their Account  Value to Separate  Account D does not  participate  in the  investment  gain or loss on assets
maintained  in  Separate  Account  D. Such gain or loss  accrues  solely to us. We retain  the risk that the value of the  assets in
Separate  Account D may drop below the reserves and other  liabilities we must maintain.  Should the value of the assets in Separate
Account D drop below the reserve and other  liabilities we must maintain in relation to the annuities  supported by such assets,  we
will transfer  assets from our general  account to Separate  Account D to make up the  difference.  We have the right to transfer to
our  general  account any assets of Separate  Account D in excess of such  reserves  and other  liabilities.  We maintain  assets in
Separate Account D supporting a number of annuities we offer.

We  currently  employ  investment  managers  to manage the  assets  maintained  in  Separate  Account  D. Each  manager we employ is
responsible  for  investment  management  of a different  portion of  Separate  Account D. From time to time  additional  investment
managers  may be employed or  investment  managers may cease being  employed.  We are under no  obligation  to employ or continue to
employ any investment manager(s) and have sole discretion over the investment managers we retain.

We are not obligated to invest  according to specific  guidelines or strategies  except as may be required by Connecticut  and other
state insurance laws.

WHAT IS THE LEGAL STRUCTURE OF THE UNDERLYING FUNDS?
Each underlying  mutual fund is registered as an open-end  management  investment  company under the Investment  Company Act. Shares
of the underlying  mutual fund portfolios are sold to separate  accounts of life insurance  companies  offering variable annuity and
variable life insurance products.  The shares may also be sold directly to qualified pension and retirement plans.

Voting Rights
We are the legal owner of the shares of the underlying  mutual funds in which the  Sub-accounts  invest.  However,  under SEC rules,
you have voting  rights in relation  to Account  Value  maintained  in the  Sub-accounts.  If an  underlying  mutual fund  portfolio
requests a vote of  shareholders,  we will vote our shares based on  instructions  received from Owners with Account Value allocated
to that  Sub-account.  Owners have the right to vote an amount equal to the number of shares  attributable  to their  contracts.  If
we do not receive voting  instructions  in relation to certain  shares,  we will vote those shares in the same manner and proportion
as the shares  for which we have  received  instructions.  We will  furnish  those  Owners who have  Account  Value  allocated  to a
Sub-account  whose  underlying  mutual fund portfolio has requested a "proxy" vote with proxy  materials and the necessary  forms to
provide us with their voting  instructions.  Generally,  you will be asked to provide instructions for us to vote on matters such as
changes in a  fundamental  investment  strategy,  adoption  of a new  investment  advisory  agreement,  or matters  relating  to the
structure of the underlying mutual fund that require a vote of shareholders.

American  Skandia  Trust (the  "Trust") has obtained an  exemption  from the  Securities  and Exchange  Commission  that permits its
investment adviser,  American Skandia Investment Services,  Incorporated ("ASISI"),  subject to approval by the Board of Trustees of
the Trust, to change  sub-advisors  for a Portfolio and to enter into new sub-advisory  agreements,  without  obtaining  shareholder
approval of the changes.  This exemption (which is similar to exemptions  granted to other  investment  companies that are organized
in a similar manner as the Trust) is intended to facilitate the efficient  supervision  and management of the  sub-advisors by ASISI
and the  Trustees.  The Trust is  required,  under the terms of the  exemption,  to  provide  certain  information  to  shareholders
following these types of changes.

Material Conflicts
It is possible that  differences  may occur between  companies  that offer shares of an  underlying  mutual fund  portfolio to their
respective  separate  accounts  issuing  variable  annuities  and/or  variable life insurance  products.  Differences may also occur
surrounding the offering of an underlying  mutual fund portfolio to variable life insurance  policies and variable annuity contracts
that we offer.  Under certain  circumstances,  these  differences could be considered  "material  conflicts," in which case we would
take  necessary  action to protect  persons with voting rights under our variable  annuity  contracts  and variable  life  insurance
policies  against  persons  with  voting  rights  under other  insurance  companies'  variable  insurance  products.  If a "material
conflict" were to arise between owners of variable  annuity  contracts and variable life  insurance  policies  issued by us we would
take  necessary  action to treat such  persons  equitably  in  resolving  the  conflict.  "Material  conflicts"  could  arise due to
differences  in voting  instructions  between  owners of variable  life  insurance  and  variable  annuity  contracts of the same or
different companies.  We monitor any potential conflicts that may exist.

Service Fees Payable to American Skandia
American  Skandia or our  affiliates  have  entered  into  agreements  with the  investment  adviser or  distributor  of many of the
underlying  Portfolios.  Under the terms of these agreements,  American Skandia provides  administrative and support services to the
Portfolios for which a fee is paid that is generally based on a percentage of the average assets  allocated to the Portfolios  under
the Annuity.  Any fees payable  will be  consistent  with the services  rendered or the  expected  cost savings  resulting  from the
arrangement.  These agreements may be different for each underlying mutual fund whose portfolios are offered as Sub-accounts.

WHO DISTRIBUTES ANNUITIES OFFERED BY AMERICAN SKANDIA?
American Skandia  Marketing,  Incorporated  ("ASM"),  a wholly-owned  subsidiary of American  Skandia,  Inc., is the distributor and
principal  underwriter of the securities  offered  through this  prospectus.  ASM acts as the distributor of a number of annuity and
life  insurance  products we offer and both American  Skandia Trust and American  Skandia  Advisor  Funds,  Inc., a family of retail
mutual  funds.  ASM also acts as an  introducing  broker-dealer  through  which it receives a portion of  brokerage  commissions  in
connection  with  purchases  and sales of securities  held by  portfolios of American  Skandia Trust which are offered as underlying
investment options under the Annuity.

ASM's principal business address is One Corporate Drive,  Shelton,  Connecticut 06484. ASM is registered as broker-dealer  under the
Securities Exchange Act of 1934 ("Exchange Act") and is a member of the National Association of Securities Dealers, Inc. ("NASD").

The Annuity is offered on a continuous  basis.  ASM enters into  distribution  agreements with  independent  broker-dealers  who are
registered  under the Exchange Act and with entities that may offer the Annuity but are exempt from  registration.  Applications for
the Annuity are solicited by registered  representatives of those firms. Such  representatives  will also be our appointed insurance
agents under state insurance law.  In addition, ASM may offer the Annuity directly to potential purchasers.

Compensation  is paid to firms on sales of the Annuity  according  to one or more  schedules.  The  individual  representative  will
receive a portion of the  compensation,  depending on the practice of the firm.  Compensation  is generally based on a percentage of
Purchase  Payments  made, up to a maximum of 6.0%.  Alternative  compensation  schedules are available  that provide a lower initial
commission  plus ongoing  annual  compensation  based on all or a portion of Account  Value.  We may also provide  compensation  for
providing  ongoing  service to you in relation to the Annuity.  Commissions and other  compensation  paid in relation to the Annuity
do not result in any additional charge to you or to the Separate Account.

In addition,  firms may receive  separate  compensation  or  reimbursement  for,  among other things,  training of sales  personnel,
marketing or other services they provide to us or our affiliates.  We or ASM may enter into  compensation  arrangements with certain
firms.  These  arrangements  will not be offered to all firms and the terms of such  arrangements may differ between firms. Any such
compensation  will be paid by us or ASM and will not result in any additional  charge to you. To the extent  permitted by NASD rules
and other  applicable laws and  regulations,  ASM may pay or allow other  promotional  incentives or payments in the form of cash or
other compensation.

Advertising:  We may  advertise  certain  information  regarding  the  performance  of the  investment  options.  Details  on how we
calculate  performance  for the  Sub-accounts  are found in the  Statement of Additional  Information,  including how we account for
Credits in these performance  measures.  This information may help you review the performance of the investment  options and provide
a basis for comparison with other  annuities.  This  information may be less useful when comparing the performance of the investment
options with other savings or investment  vehicles.  Such other  investments  may not provide some of the benefits of annuities,  or
may not be designed for  long-term  investment  purposes.  Additionally  other  savings or  investment  vehicles may not receive the
beneficial tax treatment given to annuities under the Code.

We may advertise the performance of the Portfolios in the form of "Standard" and  "Non-standard"  Total Returns  calculated for each
Sub-account.  "Standard Total Return" figures assume a hypothetical  initial  investment of $1,000 allocated to a Sub-account during
the most recent one,  five and ten year periods (or since the inception  date that the Portfolio has been offered as a  Sub-account,
if less).  "Standard  Total  Return"  figures  assume  that the  applicable  Insurance  Charge,  Distribution  Charge and the Annual
Maintenance  Fee are deducted and that the Annuity is surrendered at the end of the applicable  period,  meaning that any Contingent
Deferred  Sales  Charge  that would  apply  upon  surrender  is also  deducted.  "Standard  Total  Return"  figures do not take into
consideration  any Credits.  "Non-standard  Total Return" figures  include any performance  figures that do not meet the SEC's rules
for Standard Total Returns.  "Non-standard  Total Return" figures are calculated in the same manner as  standardized  returns except
that the figures may not reflect all fees and charges.  In  particular,  they may assume no  surrender at the end of the  applicable
period so that the CDSC does not apply.  "Non-standard  Total Return"  figures may assume Credits of 6%;  however,  Credits  applied
during  Annuity  Years 2-6 will receive less Credits on Purchase  Payments and Purchase  Payments  applied after Annuity Year 6 will
receive no Credits  (see "How Do I Receive  Credits?").  Standard and  Non-standard  Total  Returns will not reflect the  additional
asset-based  charges that are deducted  when you elect any optional  benefits.  The  additional  cost  associated  with any optional
benefits you elected will reduce your performance.  Non-standard Total Returns must be accompanied by Standard Total Returns.

Some of the  underlying  Portfolios  existed  prior to the  inception  of these  Sub-accounts.  Performance  quoted  in  advertising
regarding  such  Sub-accounts  may indicate  periods during which the  Sub-accounts  have been in existence but prior to the initial
offering of the Annuities,  or periods during which the underlying  Portfolios  have been in existence,  but the  Sub-accounts  have
not. Such hypothetical  historical  performance is calculated using the same assumptions  employed in calculating actual performance
since inception of the  Sub-accounts.  Hypothetical  historical  performance of the underlying  Portfolios prior to the existence of
the Sub-accounts may only be presented as Non-Standard Total Returns.

We may advertise the  performance  of money  market-type  Sub-accounts  using a measure of the "current and  effective  yield".  The
current yield of a money  market-type  Sub-account  is  calculated  based upon the previous  seven-day  period ending on the date of
calculation.  The effective yield of a money  market-type  Sub-account  reflects the  reinvestment of net income earned daily on the
assets of such a Sub-account.  The current and effective yields reflect the Insurance  Charge,  Distribution  Charge (if applicable)
and the charge for any optional  benefits (if applicable)  deducted  against the  Sub-account.  In a low interest rate  environment,
yields for money  market-type  Sub-accounts,  after deduction of the Insurance Charge,  Distribution  Charge (if applicable) and the
charge for any optional  benefits (if  applicable)  may be negative  even though the yield  (before  deducting  for such charges) is
positive.  Current and effective yield  information  will fluctuate.  This  information may not provide a basis for comparisons with
deposits in banks or other  institutions  which pay a fixed yield over a stated period of time, or with  investment  companies which
do not serve as underlying mutual funds for variable  annuities and/or do not have additional  asset-based  charges deducted for the
insurance protection provided by the Annuity.

Performance  information on the Sub-accounts is based on past performance only and is not an indication or  representation of future
performance.  Performance of the Sub-accounts is not fixed.  Actual  performance  will depend on the type,  quality and, for some of
the  Sub-accounts,  the maturities of the investments held by the underlying  mutual funds or portfolios and upon prevailing  market
conditions and the response of the underlying  mutual funds to such  conditions.  Actual  performance will also depend on changes in
the expenses of the underlying  mutual funds or portfolios.  Such changes are reflected,  in turn, in the Sub-accounts  which invest
in such  underlying  mutual  fund or  portfolio.  In  addition,  the total  amount of  asset-based  charges  assessed  against  each
Sub-account will affect performance.

The information we may advertise  regarding the Fixed  Allocations  may include the then current  interest rates we are crediting to
new Fixed  Allocations.  Information  on  current  rates  will be as of the date  specified  in such  advertisement.  Rates  will be
included in  advertisements  to the extent  permitted by law. Given that the actual rates  applicable to any Fixed Allocation are as
of the date of any such Fixed  Allocation's  Guarantee  Period begins,  the rate credited to a Fixed  Allocation may be more or less
than those quoted in an advertisement.

Advertisements  we distribute may also compare the  performance of our  Sub-accounts  with: (a) certain  unmanaged  market  indices,
including but not limited to the Dow Jones Industrial  Average,  the Standard & Poor's 500, the NASDAQ 100, the Shearson Lehman Bond
Index,  the Frank Russell  non-U.S.  Universal Mean, the Morgan Stanley  Capital  International  Index of Europe,  Asia and Far East
Funds, and the Morgan Stanley Capital  International World Index; and/or (b) other management  investment  companies with investment
objectives  similar to the mutual fund or portfolio  underlying the  Sub-accounts  being compared.  This may include the performance
ranking assigned by various publications,  including but not limited to the Wall Street Journal,  Forbes,  Fortune, Money, Barron's,
Business Week, USA Today and  statistical  services,  including but not limited to Lipper  Analytical  Services Mutual Funds Survey,
Lipper Annuity and Closed End Survey,  the Variable  Annuity Research Data Survey,  SEI, the Morningstar  Mutual Fund Sourcebook and
the Morningstar Variable Annuity/Life Sourcebook.

American Skandia Life Assurance  Corporation may advertise its rankings and/or ratings by independent  financial  ratings  services.
Such rankings may help you in evaluating  our ability to meet our  obligations in relation to Fixed  Allocations,  pay minimum death
benefits,  pay annuity  payments or administer  Annuities.  Such rankings and ratings do not reflect or relate to the performance of
Separate Account B.

AVAILABLE INFORMATION
A Statement of  Additional  Information  is available  from us without  charge upon your  request.  This  Prospectus  is part of the
registration  statement we filed with the SEC regarding this offering.  Additional  information on us and this offering is available
in those  registration  statements and the exhibits  thereto.  You may obtain copies of these materials at the prescribed rates from
the SEC's Public Reference  Section,  450 Fifth Street N.W.,  Washington,  D.C., 20549. You may inspect and copy those  registration
statements  and  exhibits  thereto at the SEC's  public  reference  facilities  at the above  address,  Room 1024,  and at the SEC's
Regional Offices,  The Woolworth Building,  233 Broadway,  New York, NY and 175 W. Jackson Boulevard,  Suite 900, Chicago, IL. These
documents,   as  well  as  documents  incorporated  by  reference,   may  also  be  obtained  through  the  SEC's  Internet  Website
(http://www.sec.gov) for this registration statement as well as for other registrants that file electronically with the SEC.

INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
To the extent and only to the extent that any statement in a document  incorporated  by reference  into this  Prospectus is modified
or  superseded  by a statement in this  Prospectus  or in a  later-filed  document,  such  statement is hereby deemed so modified or
superseded and not part of this  Prospectus.  The Annual Report on Form 10-K for the year ended December 31, 2002  previously  filed
by the Company with the SEC under the Exchange Act is incorporated by reference in this Prospectus.

We will furnish you without charge a copy of any or all of the documents  incorporated  by reference in this  Prospectus,  including
any exhibits to such documents which have been  specifically  incorporated by reference.  We will do so upon receipt of your written
or oral request.

HOW TO CONTACT US
You can contact us by:
|X|      calling our  Customer  Service  Team at  1-800-680-8920,  or  Skandia's  Telephone  Automated  Response  System  (STARS) at
       1-800-766-4530.
|X|      writing to us via regular mail at American Skandia - Variable  Annuities,  Attention:  Stagecoach  Annuity,  P.O. Box 7040,
       Bridgeport,  Connecticut 06601-7040 OR for express mail American Skandia - Variable Annuities, Attention: Stagecoach Annuity,
       One Corporate Drive,  Shelton,  Connecticut  06484. NOTE: Failure to send mail to the proper address may result in a delay in
       our receiving and processing your request.
|X|      sending an email to service@prudential.com or visiting our Internet Website at www.americanskandia.prudential.com.
|X|      accessing information about your Annuity through our Internet Website at www.americanskandia.prudential.com.

You   can   obtain   account    information    through   Skandia's    Telephone   Automated   Response   System   (STARS)   and   at
www.americanskandia.prudential.com,  our Internet Website.  Our Customer Service  representatives are also available during business
hours to provide you with  information  about your  account.  You can request  certain  transactions  through  our  telephone  voice
response system,  our Internet  Website or through a customer  service  representative.  You can provide  authorization  for a third
party,  including  your  attorney-in-fact  acting  pursuant  to a power of attorney or an  investment  professional,  to access your
account  information  and perform  certain  transactions  on your  account.  You will need to  complete a form  provided by us which
identifies  those  transactions  that you wish to authorize via telephonic and electronic  means and whether you wish to authorize a
third party to perform any such  transactions.  We require that you or your  representative  provide  proper  identification  before
performing  transactions  over the  telephone or through our Internet  Website.  This may include a Personal  Identification  Number
(PIN) that will be  provided  to you upon  issue of your  Annuity  or you may  establish  or change  your PIN  through  STARS and at
www.americanskandia.prudential.com,  our Internet Website.  Any third party that you authorize to perform financial  transactions on
your account will be assigned a PIN for your account.

Transactions  requested  via  telephone are recorded.  To the extent  permitted by law, we will not be  responsible  for any claims,
loss,  liability or expense in connection with a transaction  requested by telephone or other  electronic  means if we acted on such
transaction  instructions  after following  reasonable  procedures to identify those persons  authorized to perform  transactions on
your  Annuity  using  verification  methods  which may  include a request  for your  Social  Security  number,  PIN or other form of
electronic  identification.  We may be liable for losses due to  unauthorized  or fraudulent  instructions if we did not follow such
procedures.

American Skandia does not guarantee access to telephonic,  facsimile,  Internet or any other electronic  information or that we will
be able to accept  transaction  instructions  via such means at all times.  Regular  and/or  express  mail will be the only means by
which we will accept  transaction  instructions when telephonic,  facsimile,  Internet or any other electronic means are unavailable
or delayed.  American  Skandia  reserves the right to limit,  restrict or  terminate  telephonic,  facsimile,  Internet or any other
electronic transaction privileges at any time.

INDEMNIFICATION
Insofar as  indemnification  for  liabilities  arising under the Securities Act of 1933 (the  "Securities  Act") may be permitted to
directors,  officers or persons  controlling the registrant pursuant to the foregoing  provisions,  the registrant has been informed
that in the opinion of the SEC such  indemnification  is against  public policy as expressed in the  Securities Act and is therefore
unenforceable.

LEGAL PROCEEDINGS
As of the date of this  Prospectus,  American  Skandia and its affiliates are not involved in any legal  proceedings  outside of the
ordinary course of business.  American  Skandia and its affiliates are involved in pending and threatened  legal  proceedings in the
normal course of its business,  however,  we do not anticipate that the outcome of any such legal  proceedings  will have a material
adverse  affect on the  Separate  Account,  or American  Skandia's  ability to meet its  obligations  under the  Annuity,  or on the
distribution of the Annuity.



CONTENTS OF THE STATEMENT OF ADDITIONAL INFORMATION
The following are the contents of the Statement of Additional Information:

General Information about American Skandia
|X|      American Skandia Life Assurance Corporation
|X|      American Skandia Life Assurance Corporation Variable Account B
|X|      American Skandia Life Assurance Corporation Separate Account D

Principal Underwriter/Distributor - American Skandia Marketing, Incorporated

How Performance Data is Calculated
|X|      Current and Effective Yield
|X|      Total Return

How the Unit Price is Determined

Additional Information on Fixed Allocations
|X|      How We Calculate the Market Value Adjustment

General Information
|X|      Voting Rights
|X|      Modification
|X|      Deferral of Transactions
|X|      Misstatement of Age or Sex
|X|      Ending the Offer

Annuitization

Independent Auditors

Legal Experts

Financial Statements
|X|      Appendix A - Financial Information About American Skandia


















                                     APPENDIX A - FINANCIAL INFORMATION ABOUT AMERICAN SKANDIA





SELECTED FINANCIAL DATA (dollars in thousands)

The following table summarizes information with respect to the operations of the Company:

                                                       For the Year Ended December 31,
                                      2002            2001            2000           1999           1998
                                      ----            ----            ----           ----           ----
STATEMENTS OF INCOME DATA
Revenues:
Annuity and life insurance       $    370,004     $    388,696   $    424,578    $    289,989   $    186,211
   charges and fees (a) (b)
Fee income (b)                         97,650          111,196        130,610          83,243         50,839
Net investment income                  19,632           20,126         18,595          11,477         11,130
Net realized capital (losses)
   gains and other revenues (e)        (7,438)           2,698          4,195           3,688          1,360
                                 -------------    ------------   ------------    ------------   ------------

Total revenues                   $    479,848     $    522,716   $    577,978    $    388,397   $    249,540
                                 ============     ============   ============    ============   ============

Benefits and Expenses:
Annuity and life insurance       $      3,391     $      1,955   $        751    $        612   $        558
benefits
Change in annuity and life
   insurance policy reserves            2,741          (39,898)        49,339            (671)         1,053
   (c)
Guaranteed minimum death
   benefit claims, net of              23,256           20,370          2,618           4,785              -
   hedge (b)
Return credited to contract             5,196            5,796          8,463          (1,639)        (8,930)
owners
Underwriting, acquisition and
   other insurance expenses           188,728          196,755        150,597         125,434         86,306
Amortization of deferred
   acquisition costs (b) (d)          510,059          224,047        184,616          83,861         86,628
Interest expense                       14,544           73,424         85,998          69,502         41,004
                                 ------------     ------------   ------------    ------------   ------------

Total benefits and expenses      $    747,915     $    482,449   $    482,382    $    281,884   $    206,619
                                 ============     ============   ============    ============   ============

Income tax (benefit) expense     $   (102,810)    $      7,168   $     30,779    $     30,344   $      8,154
                                 ============     ============   ============    ============   ============

Net (loss) income                $   (165,257)    $     33,099   $     64,817    $     76,169   $     34,767
                                 ============     ============   ============    ============   ============

STATEMENTS OF FINANCIAL
CONDITION DATA
Total assets (b)                 $ 23,708,585     $ 28,009,782   $ 31,702,705    $ 30,881,579   $ 18,848,273
                                 ============     ============   ============    ============   ============

Future fees payable to parent    $    708,249     $    799,472   $    934,410    $    576,034   $    368,978
                                 ============     ============   ============    ============   ============

Surplus notes                    $    110,000     $    144,000   $    159,000    $    179,000   $    193,000
                                 ============     ============   ============    ============   ============

Shareholder's equity             $    683,061     $    577,668   $    496,911    $    359,434   $    250,417
                                 ============     ============   ============    ============   ============

a.       On annuity and life insurance sales of $3,472,044, $3,834,167, $8,216,167, $6,862,968, and $4,159,662, during the years
     ended December 31, 2002, 2001, 2000, 1999, and 1998, respectively, with contract owner assets under management of $21,894,636,
     $26,017,847, $29,751,822, $29,396,693, and $17,854,761, as of December 31, 2002, 2001, 2000, 1999, and 1998, respectively.
b.       These items are significantly impacted by equity market volatility.
c.       For the year ended December 31, 2000, change in annuity and life insurance policy reserves reflected increases to those
     reserves for guaranteed minimum death benefit ("GMDB") exposure.  For the year ended December 31, 2001, the Company changed
     certain of its assumptions related to its GMDB exposure resulting in a benefit to operations.  See Results of Operations in
     Management's Discussion and Analysis of Financial Condition and Results of Operations ("MD&A") for a further discussion.
d.       During the year ended December 31, 2002, the Company recorded an acceleration of amortization of $206,000 against the
     deferred acquisition cost asset.  See the MD&A for a further discussion.
e.       Net realized capital (losses) gains and other revenues include $5,845 of net realized capital losses on sales of
     securities during 2002 and an other than temporary impairment charge of $3,769 recorded during 2002 on the Company's equity
     securities.



MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (dollars in thousands)

Management's  Discussion  and Analysis of Financial  Condition  and Results of  Operations  should be read in  conjunction  with the
consolidated financial statements and the notes thereto and Item 6, Selected Financial Data.

 Results of Operations
 ---------------------

Annuity and life insurance sales were  $3,472,044,  $3,834,167 and $8,216,167,  in 2002, 2001 and 2000,  respectively.  The decrease
in sales in 2002 and 2001 was  primarily  the result of the general  decline in sales in the  industry,  attributed in large part to
the continued  uncertainty in the equity markets. In addition,  the Company believes uncertainty  regarding its future ownership has
adversely  impacted  sales,  primarily  in the latter  part of 2002.  The  Company  announced,  in the first  quarter  of 2002,  its
intention to focus on the growth of its core variable annuity business.

Average assets under management totaled  $23,637,559 in 2002,  $26,792,877 in 2001 and $31,581,902 in 2000,  representing a decrease
of 12% and 15% in 2002 and 2001,  respectively,  due primarily to weak equity  markets.  The decrease in annuity and life  insurance
charges and fees and fee income before  surrender  charge income and  reinsurance  was  consistent  with the decline in assets under
management.  Surrender  charge income  increased in 2002 as compared to 2001.  This was caused by higher lapses when compared to the
applicable  prior year periods,  and was primarily  attributable,  the Company  believes,  to concerns by contract  holders,  rating
agencies and the Company's  distribution  channels,  surrounding  the  uncertainty  in the equity markets and its impact on variable
annuity  companies  generally and, prior to the  announcement of the Acquisition,  uncertainty  concerning the Company's future (See
Liquidity and Capital Resources for rating agency actions).

Net realized  capital losses in 2002 were primarily  from $9,593 of losses on sales and $3,769 of  other-than-temporary  impairments
of mutual fund  investments  that are held in support of a deferred  compensation  program for certain of the  Company's  employees.
The deferred  compensation  program losses were offset by net gains of $3,746 during 2002 on sales of fixed maturities.  Included in
those net gains on sales of fixed maturities for 2002, was a realized loss of approximately  $1,236 on the sale of a WorldCom,  Inc.
bond. The net capital gains in 2001 related  primarily to sales of fixed maturity  investments,  were partially  offset by losses on
securities in the fixed  maturity  portfolio.  The most  significant  loss was $2,636 related to Enron  securities.  In addition net
realized  capital  losses  of $3,534 in 2001  were  incurred  due to sales of mutual  fund  holdings  in  support  of the  Company's
non-qualified deferred compensation program.

The change in annuity and life insurance policy reserves  includes  changes in reserves related to annuity  contracts with mortality
risks.  During 2001, the Company's  Guaranteed Minimum Death Benefit ("GMDB") reserve decreased $43,984,  as the result of an update
of certain  reserve  assumptions as to risks inherent in the benefit.  Previous  assumptions  had been based on statutory  valuation
principles as an approximation  for U.S. GAAP. In addition,  future  mortality rates were lowered in 2001 to reflect  favorable past
experience.  However,  offsetting  the  resulting  increase in earnings  and equity as a result of changes in the GMDB  liability in
2001,  assumptions  related to GMDB claim  costs were also  updated in the  calculation  of the  deferred  acquisition  cost  asset,
resulting in additional amortization of this asset.

The Company uses  derivative  instruments,  which  consist of equity  option  contracts for risk  management  purposes,  and not for
trading or  speculation.  The Company hedges the economic GMDB exposure  associated  with equity market  fluctuations.  GMDB claims,
net of hedge,  consist of GMDB claims offset by the mark to market and realized  capital  gain/loss  results of the Company's option
contracts.  During 2002 and 2001,  the  fluctuations  in GMDB  claims,  net of hedge,  were  driven by an increase in hedge  related
benefits of $19,776 and  $14,646,  respectively.  Hedge  related  benefits  were  partially  offset by  increases  in GMDB claims of
$22,662 and $32,398 during 2002 and 2001, respectively.

Return credited to contract owners consists  primarily of net investment  results from the Company's  fixed,  market value adjusted,
separate account  investment  option and changes in the Company's  experience rated  reinsurance  receivables.  The decrease in 2002
was primarily due to increased net investment  results on the Company's fixed,  market value adjusted,  separate account  investment
option.  As the equity markets decline,  movement from variable  investment  options to fixed investment  options,  primarily due to
one of the  Company's  product  features,  has  increased  the assets  invested in the fixed  separate  account  investment  option.
Included in 2002 net investment results is $9,849 of realized and unrealized losses on certain  securities,  of which $5,427 related
to  WorldCom,  Inc.  bonds.  The  increase  in net  investment  results  was  partially  offset by a decrease  in  experience  rated
reinsurance  receivables  in 2002 due to unfavorable  experience on certain blocks of variable  annuity  business.  In 2001,  return
credited to contract  owners  decreased  primarily  due to favorable  experience  on certain  blocks of variable  annuity  contracts
increasing the experience rated reinsurance  receivable.  Partially  offsetting the 2001 decrease is net investment losses of $1,662
related to Enron securities.

Underwriting, acquisition and other insurance expenses for 2002, 2001 and 2000 were as follows:

                                                        2002              2001               2000
                                                        ----              ----               ----
Commissions and purchase credits                         $   287,612       $   248,187         $   430,743
General operating expenses                                   145,438           157,704             214,957
Acquisition costs deferred                                  (244,322)         (209,136)           (495,103)
                                                         -----------       -----------         -----------
Underwriting,   acquisition   and   other   insurance
     expenses                                            $   188,728       $   196,755         $   150,597
                                                         ===========       ===========         ===========

New products  launched,  as well as a larger  proportion of sales of products with higher  commissions as compared to 2001 led to an
increase in  commissions  and purchase  credits  during  2002.  Lower sales and asset  levels led to a decrease in  commissions  and
purchase credits during 2001.  Partially  offsetting this decline in 2001, the company launched a commission  promotion program that
increased  commissions  as a percentage of new sales.  Commission  promotions in 2002 were  approximately  equivalent as compared to
2001.

General  operating  expenses  decreased  during  2002 and 2001 as a result of lower  sales-based  compensation,  as well as  expense
reduction  programs  implemented during 2001 and continued strong expense  management in 2002.  Variable  compensation and long-term
incentive plan expenses have decreased due to the slowdown in sales and the decline in the equity markets.

Amortization  of deferred  acquisition  costs  increased over the past two years, in general,  due to the further  depressed  equity
markets in 2002 and 2001,  thereby  decreasing  expectations  of future gross profits and actual gross profits from asset based fees
and  increased  expected and actual claim costs  associated  with minimum death benefit  guarantees.  During 2002,  the Company also
performed a  recoverability  study and an analysis of its  short-term  assumptions  of future  gross  profits and  determined  those
assumptions  of future  profits  to be  excessive.  This  analysis  resulted  in a current  year  acceleration  of  amortization  of
$206,000.  During 2002 and 2001,  the Company  also updated its future  estimated  gross  profits with respect to certain  mortality
assumptions  reflecting  actual  experience and the decline in the equity markets  resulting in additional  increased  amortization.
See Note 2 of Notes to Consolidated Financial Statements for a further discussion on amortization of deferred acquisition costs.

Interest  expense  decreased during 2002 primarily due to lower interest expense related to the future fees payable to ASI liability
(See Note 8). Interest  expense on these  obligations is driven by the cash flows from the underlying  annuity  contracts  acting as
collateral.  Due to the depressed  asset values of those annuity  contracts  driven by the decline in the equity  markets,  the cash
flows, and therefore the interest  expense,  decreased from prior year levels.  Interest expense  decreased in 2001 as a result of a
reduction in borrowing.

The Company's  income tax  (benefit)  expense  varies  directly with  increases or decreases in (loss) income from  operations.  The
effective income tax rate varied from the corporate rate of 35% due primarily to the deduction for dividends received.

Total assets and  liabilities  decreased  $4,301,197 and  $4,406,590,  respectively,  from December 31, 2001.  This change  resulted
primarily from the declining equity markets.

 Significant Accounting Policies
 -------------------------------

 Deferred Acquisition Costs

The costs of acquiring  new business,  which vary with and are primarily  related to new business  generated,  are deferred,  net of
reinsurance.  These costs include  commissions,  purchase  credits,  costs of contract  issuance,  and certain selling expenses that
vary with production.

The Company uses the  retrospective  deposit  method for  amortizing  deferred  acquisition  costs.  This method results in deferred
acquisition  costs being  amortized in proportion to expected gross profits from surrender  charges and policy and asset based fees,
net of  operating  and claim  costs.  The  deferred  acquisition  cost asset is  adjusted  retrospectively  and  prospectively  when
estimates  of current and future  gross  profits to be realized  from a group of  products  are  revised.  Critical  assumptions  in
estimating  gross profits  include those for  surrenders,  long-term fund growth rate,  expenses and death  benefits.  The long-term
fund growth rate, in large part,  determines  the estimated  future asset levels on which the most  significant  revenues are based.
The Company's  long-term fund growth rate assumption is 8% (net of charges assessed  against the underlying  mutual fund, but before
charges assessed at the separate  account and contract  level).  When current period actual asset growth is greater or less than the
Company's  long-term  expectation,  the Company adjusts the short-term asset growth rate to a level that will allow the Company,  in
the short-term,  to resume the long-term asset growth rate  expectation.  The short-term asset growth rate is subject to constraints
surrounding  actual market  conditions.  If the Company's  long-term fund growth rate assumption was 7% instead of 8%, the Company's
deferred acquisition cost asset at December 31, 2002 would be reduced by $26,273.

 Future Fees Payable to ASI

In a series of  transactions  with ASI,  the Company  transferred  certain  rights to receive a portion of future fees and  contract
charges expected to be realized on designated blocks of deferred annuity contracts.

The proceeds  from the  transfers  have been recorded as a liability and are being  amortized  over the remaining  surrender  charge
period of the  designated  contracts  using the interest  method.  The Company did not transfer the right to receive future fees and
charges after the expiration of the surrender charge period.

In connection with these  transactions,  ASI, through special purpose trusts,  issued  collateralized  notes in private  placements,
which are secured by the rights to receive future fees and charges purchased from the Company.

Under the terms of the securitization  purchase  agreements,  the rights  transferred  provide for ASI to receive a percentage (60%,
80% or 100% depending on the underlying  commission  option) of future  mortality and expense charges and contingent  deferred sales
charges,  after  reinsurance,  expected to be realized  over the  remaining  surrender  charge  period of the  designated  contracts
(generally  6 to 8 years).  The  liability  for future fees payable to ASI at the balance  sheet date is based on the  consideration
received less principal  repayments  according to amortization  schedules that were developed at the inception of the  transactions.
If actual  mortality  and expense  charges and  contingent  deferred  sales  charges are less than those  projected  in the original
amortization  schedules,  calculated on a transaction  by transaction  basis,  ASI has no recourse  against the Company.  As account
values  associated  with the  designated  contracts  have  declined,  consistent  with the  overall  decline in the equity  markets,
historical  mortality  and  expense  charges  have been lower than  expected  on certain  transactions  and it is likely that future
mortality and expense  charges,  on those same  transactions,  will be lower than originally  projected.  As a result,  the ultimate
cash flows  associated  with these  transactions  that will  transfer  to ASI may be lower than the current  carrying  amount of the
liability.

The Company has determined,  using  assumptions for lapses,  mortality,  free  withdrawals and a long-term fund growth rate of 8% on
the Company's assets under management, that the present value of future payments to ASI would be $429,773.

 Deferred Taxes

The Company  evaluates the necessity of recording a valuation  allowance against its deferred tax asset in accordance with Statement
of Financial  Accounting  Standards No. 109,  Income Taxes ("SFAS 109"). In performing this  evaluation,  the Company  considers all
available  evidence  in making  the  determination  as to  whether  it is more  likely  than not that  deferred  tax  assets are not
realizable.  For the Company,  that evidence  includes:  cumulative  U.S. GAAP pre-tax  income in recent years past,  whether or not
operating  losses have expired  unused in the past,  the length of  remaining  carryback or  carryforward  periods,  and net taxable
income or loss  expectations  in early future years.  The net taxable  income or loss  projections  are based on profit  assumptions
consistent with those used to amortize deferred acquisition costs (see above discussion on deferred acquisition costs).

As of December 31, 2002, the Company has  approximately  $361,000  gross  deferred tax assets  related  principally to net operating
loss  carryforwards  that  expire  in 2016 and 2017 and  insurance  reserve  differences.  After  considering  the  impact  of gross
reversing  temporary  liabilities of $323,000,  the Company  estimates that the Company will generate  sufficient  taxable income to
fully utilize gross deferred tax assets within 2 years (prior to the expiration of the net operating losses).

 Liquidity and Capital Resources
 -------------------------------

The Company's liquidity requirements have generally been met by cash from insurance operations,  investment  activities,  borrowings
from ASI, reinsurance, capital contributions and securitization transactions with ASI (see Note 8).

The  Company's  cash from  insurance  operations  is primarily  comprised of fees  generated  off of assets under  management,  less
commission  expense on sales,  sales and marketing  expenses and other operating  expenses.  Fund  performance  driven by the equity
markets  directly impact assets under management and therefore,  the fees the Company can generate off of those assets.  During 2002
and 2001, assets under management  declined  consistent with the equity market declines resulting in reductions in fee revenues.  In
addition,  the  equity  markets  impact  sales  of  variable  annuities.  As sales  have  declined  in a  declining  equity  market,
non-promotional  commission  expense  declined,  however,  in order to boost sales  levels,  the Company has offered  various  sales
promotions increasing the use of cash for commission expense.

In order to fund the cash strain  generated from  acquisition  costs on current sales, the Company has relied on cash generated from
its direct insurance  operations as well as reinsurance and securitization  transactions.  The Company has used modified coinsurance
reinsurance  arrangements  whereby the  reinsurer  shares in the  experience  of a specified  book of  business.  These  reinsurance
transactions  result in the Company  receiving  from the reinsurer an upfront  ceding  commission  on the book of business  ceded in
exchange for the reinsurer  receiving , the future fees  generated from that book of business.  These  reinsurance  agreements  also
mitigate the recoverability  risk associated with the payment of up-front  commissions and other acquisition costs.  Similarly,  the
Company has entered into securitization  transactions  whereby the Company issues to ASI, in exchange for cash, the right to receive
future fees  generated  off of a specific  book of  business.  On April 12,  2002,  the Company  entered  into a new  securitization
transaction  with ASI. This  transaction  covers  designated  blocks of business  issued from November 1, 2000 through  December 31,
2001.  The  estimated  present  value of the  transaction  at April 12,  2002,  using a discount  rate of 6.00%,  was  approximately
$101,713.

As of December 31, 2002, 2001 and 2000, the Company had short-term  borrowings of $10,000,  $10,000 and $10,000,  respectively,  and
had  long-term  surplus notes  liabilities  of $110,000,  $144,000 and $159,000,  respectively.  During 2002,  the Company  borrowed
$263,091 and paid back $263,091  related to short-term  borrowing.  During 2002 and 2001, the Company  received  permission from the
State of Connecticut  Insurance Department to pay down surplus notes in the amount of $34,000 and $15,000,  respectively.  See Notes
14 and 15 of Notes  to  Consolidated  Financial  Statements  for  more  information  on  surplus  notes  and  short-term  borrowing,
respectively.

As of December 31, 2002, 2001 and 2000,  shareholder's  equity totaled $683,061,  $577,668 and $496,911,  respectively.  The Company
received capital  contributions  of $259,720 and $48,000 from ASI during 2002 and 2001,  respectively.  Of this,  $4,520 and $2,500,
respectively,  was used to support its  investment in Skandia  Vida.  Net (loss)  income of  ($165,257)  and $33,099,  for the years
ended December 31, 2002 and 2001, respectively, contributed to the respective changes in shareholder's equity in 2002 and 2001.

The National Association of Insurance  Commissioners  ("NAIC") requires insurance companies to report information  regarding minimum
Risk Based Capital ("RBC")  requirements.  These requirements are intended to allow insurance  regulators to identify companies that
may need regulatory  attention.  The RBC model law requires that insurance  companies  apply various  factors to asset,  premium and
reserve items,  all of which have inherent risks.  The formula  includes  components for asset risk,  insurance risk,  interest rate
risk and business risk.  The Company has complied with the NAIC's RBC reporting  requirements  and has total  adjusted  capital well
above required capital.

During 2002,  all of the major rating  agencies  reviewed the U.S. life  insurance  sector,  including  the Company.  Based on these
reviews the rating  agencies  have  evolving  concerns  surrounding  the risk  profile of variable  annuity  companies  due to their
significant  exposure  to equity  market  performance.  This  exposure  has  resulted,  and may  continue  to  result,  in  earnings
volatility.  Based on the reviews made during 2002, the following ratings actions took place:

On May 8,  2002,  Fitch  Ratings  downgraded  the  Company's  "insurer  financial  strength"  rating to A+ from AA- with a  "stable"
outlook.

On September 19, 2002,  Fitch Ratings lowered the Company's  "insurer  financial  strength"  rating to A- from A+ with an "evolving"
outlook.

On September 27, 2002, A.M. Best Co. lowered the Company's "financial strength" rating to A- from A with negative implications.

On October 16, 2002,  Standard and Poor's lowered the Company's  "counter party credit" and "financial  strength" ratings to A- from
A+ with a negative outlook and removed the Company from Credit Watch.

Subsequent  to the  announcement  of the  Acquisition,  Standard  and  Poor's  placed  the  Company  on  CreditWatch  with  positive
implications.

 Effects of Inflation
 --------------------

The rate of inflation has not had a significant effect on the Company's financial statements.

Outlook
- -------

The Company believes that it is well positioned to retain and enhance its position as a leading  provider of financial  products for
long-term  savings and retirement  purposes as well as to address the economic impact of premature death,  estate planning  concerns
and supplemental  retirement  needs. The Company has renewed its focus on its core variable annuity  business,  offering  innovative
long-term  savings and income products,  strengthening its wholesaling  efforts and providing  consistently good customer service in
order to gain market share and improve profitability in an increasingly competitive market.

The  Gramm-Leach-Bliley  Act of 1999 (the Financial Services  Modernization Act) permits  affiliation among banks,  securities firms
and insurance  companies.  This legislative change has created  opportunities for continued  consolidation in the financial services
industry and increased competition as large companies offer a wide array of financial products and services.

Various  other  legislative  initiatives  could impact the Company such as pension  reform and capital gains and estate tax changes.
These  include the  proposed  exclusion  from tax for  corporate  dividends,  potential  changes to the  deductibility  of dividends
received from the Company's  separate accounts and newly proposed  tax-advantaged  savings programs.  Additional  pension reform may
change current tax deferral rules and allow increased  contributions to retirement  plans,  which may lead to higher  investments in
tax-deferred  products and create  growth  opportunities  for the Company.  A capital  gains tax  reduction  may cause  tax-deferred
products to be less attractive to consumers, which could adversely impact the Company.

In addition,  NAIC  statutory  reserving  guidelines  and/or  interpretations  of those  guidelines  may change in the future.  Such
changes may require the Company to modify, perhaps materially, its statutory-based reserves for variable annuity contracts.

 Forward Looking Information
 ---------------------------

The Private Securities  Litigation Reform Act of 1995 (the "1995 Act") provides a "safe harbor" for forward-looking  statements,  so
long as those statements are identified as forward-looking,  and the statements are accompanied by meaningful  cautionary statements
that identify  important  factors that could cause actual results to differ  materially  from those  discussed in the statement.  We
want to take advantage of these safe harbor provisions.

Certain  information  contained in the  Management's  Discussion  and Analysis of Financial  Condition  and Results of Operations is
forward-looking within the meaning of the 1995 Act or Securities and Exchange Commission rules.


These  forward-looking  statements  rely on a number  of  assumptions  concerning  future  events,  and are  subject  to a number of
significant  uncertainties  and results may differ  materially  from these  statements.  You should not put undue  reliance on these
forward-looking  statements.  We disclaim any intention or obligation to update or revise forward-looking  statements,  whether as a
result of new information, future events or otherwise.


 QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The Company is subject to potential  fluctuations in earnings and the fair value of certain of its assets and  liabilities,  as well
as variations in expected cash flows due to changes in market  interest rates and equity prices.  The following  discussion  focuses
on specific  exposures the Company has to interest rate and equity price risk and describes  strategies  used to manage these risks,
and includes  "forward-looking  statements" that involve risk and uncertainties.  The discussion is limited to financial instruments
subject to market risks and is not intended to be a complete discussion of all of the risks to which the Company is exposed.

 Interest Rate Risk
 ------------------

Fluctuations  in interest rates can  potentially  impact the Company's  profitability  and cash flows.  At December 31, 2002, 91% of
assets held under  management  by the Company are in  non-guaranteed  Separate  Accounts for which the  Company's  interest rate and
equity  market  exposure is not  significant,  as the contract  owner  assumes  substantially  all of the  investment  risk.  Of the
remaining  9% of  assets,  the  interest  rate risk from  contracts  that  carry  interest  rate  exposure  is  managed  through  an
asset/liability matching program which takes into account the risk variables of the insurance liabilities supported by the assets.

At December 31, 2002, the Company held fixed maturity  investments in its general  account that are sensitive to changes in interest
rates. These securities are held in support of the Company's fixed immediate  annuities,  fixed supplementary  contracts,  the fixed
investment option offered in its variable life insurance  contracts,  and in support of the Company's target solvency  capital.  The
Company has a conservative  investment  philosophy with regard to these investments.  All investments are investment grade corporate
securities, government agency or U.S. government securities.

The Company's  deferred  annuity  products  offer a fixed  investment  option which  subjects the Company to interest rate risk. The
fixed option  guarantees a fixed rate of interest for a period of time  selected by the contract  owner.  Guarantee  period  options
available range from one to ten years.  Withdrawal of funds,  or transfer of funds to variable  investment  options,  before the end
of the guarantee  period subjects the contract owner to a market value  adjustment  ("MVA").  In the event of rising interest rates,
which make the fixed  maturity  securities  underlying  the  guarantee  less  valuable,  the MVA could be negative.  In the event of
declining  interest  rates,  which make the fixed maturity  securities  underlying  the guarantee  more  valuable,  the MVA could be
positive.  The resulting  increase or decrease in the value of the fixed option,  from calculation of the MVA, should  substantially
offset the increase or decrease in the market  value of the  securities  underlying  the  guarantee.  The Company  maintains  strict
asset/liability  matching  to  enable  this  offset.  However,  the  Company  still  takes on the  default  risk for the  underlying
securities,  the interest rate risk of  reinvestment  of interest  payments and the risk of failing to maintain the  asset/liability
matching program with respect to duration and convexity.

Liabilities held in the Company's  guaranteed separate account as of December 31, 2002 totaled $1,828,048.  Assets,  primarily fixed
income  investments,  supporting those liabilities had a fair value of $1,828,048.  The Company performed a sensitivity  analysis on
these  interest-sensitive  liabilities and assets at December 31, 2002. The analysis showed that an immediate  decrease of 100 basis
points in interest rates would result in a net increase in liabilities and the  corresponding  assets of  approximately  $69,150 and
$68,500,  respectively.  An analysis of a 100 basis point decline in interest  rates at December 31, 2001,  showed a net increase in
interest-sensitive liabilities and the corresponding assets of approximately $39,800 and $39,900, respectively.

 Equity Market Exposure
 ----------------------

The primary  equity market risk to the Company comes from the nature of the variable  annuity and variable life products sold by the
Company.  Various  fees and  charges  earned  are  substantially  derived  as a  percentage  of the  market  value of  assets  under
management.  In a market decline,  this income will be reduced.  This could be further  compounded by customer  withdrawals,  net of
applicable  surrender  charge  revenues,  partially  offset by transfers to the fixed option  discussed  above. A 10% decline in the
market value of the assets under  management at December 31, 2002,  sustained  throughout  2003, would result in an approximate drop
in related mortality and expense charges and annual fee income of $36,350.

Another  equity  market risk  exposure of the Company  relates to guaranteed  minimum  death  benefit  payments.  Declines in equity
markets and,  correspondingly,  the  performance of the funds  underlying the Company's  products,  increase  exposure to guaranteed
minimum death benefit  payments.  As discussed in Note 2D of the  consolidated  financial  statements,  the Company uses  derivative
instruments to hedge against the risk of  significant  decreases in equity  markets.  Prior to the  implementation  of this program,
the Company used reinsurance to mitigate this risk.

The Company has a portfolio of equity investments  consisting of mutual funds, which are held in support of a deferred  compensation
program.  In the event of a decline in market values of underlying  securities,  the value of the portfolio  would decline;  however
the accrued benefits payable under the related deferred compensation program would decline by a corresponding amount.

Estimates of interest rate risk and equity price risk were  obtained  using  computer  models that take into  consideration  various
assumptions  about the future.  Given the  uncertainty  of future  interest rate  movements,  volatility  in the equity  markets and
consumer behavior, actual results may vary from those predicted by the Company's models.










                                            AUDITED CONSOLIDATED FINANCIAL STATEMENTS OF
                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION









                                                   Report of Independent Auditors

To the Board of Directors and Shareholder of
    American Skandia Life Assurance Corporation
Shelton, Connecticut

We have audited the consolidated  statements of financial  condition of American  Skandia Life Assurance  Corporation (the "Company"
which is an indirect  wholly-owned  subsidiary of Skandia  Insurance Company Ltd.) as of December 31, 2002 and 2001, and the related
consolidated  statements  of income,  shareholder's  equity and cash flows for each of the three years in the period ended  December
31, 2002. These  consolidated  financial  statements are the  responsibility of the Company's  management.  Our responsibility is to
express an opinion on these consolidated financial statements based on our audits.

We conducted our audits 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 audits provide a reasonable basis for our opinion.

In our opinion,  the financial  statements  referred to above present fairly, in all material respects,  the consolidated  financial
position of American  Skandia Life  Assurance  Corporation  at December  31, 2002 and 2001,  and the  consolidated  results of their
operations  and their cash flows for each of the three years in the period ended  December 31, 2002, in conformity  with  accounting
principles generally accepted in the United States.

As discussed in Note 2, in 2002 the Company adopted Statement of Financial Accounting Standards No. 142, Goodwill and Other
Intangible Assets.

As discussed in Note 2, effective January 1, 2001, the Company adopted Statement of Financial Accounting Standards No. 133,
Accounting for Derivative Instruments and Hedging Activities.


/s/ Ernst & Young LLP

Hartford, Connecticut
February 3, 2003




                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                              (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                           Consolidated Statements of Financial Condition
                                                 (in thousands, except share data)

                                                                           As of December 31,
                                                                          2002            2001
                                                                          ----            ----
ASSETS
- ------
Investments:
   Fixed maturities - at fair value (amortized cost of $379,422
     and $356,882, respectively)                                     $       398,601 $       362,831
   Equity securities - at fair value (amortized cost of $52,017
     and $49,886, respectively)                                               51,769          45,083
   Derivative instruments - at fair value                                     10,370           5,525
   Policy loans                                                                7,559           6,559
                                                                     --------------- ---------------

     Total investments                                                       468,299         419,998

Cash and cash equivalents                                                     51,339               -
Accrued investment income                                                      4,196           4,737
Deferred acquisition costs                                                 1,117,544       1,383,281
Reinsurance receivable                                                         5,447           7,733
Receivable from affiliates                                                     3,961           3,283
Income tax receivable                                                              -          30,537
Deferred income taxes                                                         38,206               -
Fixed assets, at depreciated cost (accumulated depreciation of
$7,555 and $4,266, respectively)                                              12,132          17,752
Other assets                                                                 101,848         103,912
Separate account assets                                                   21,905,613      26,038,549
                                                                     --------------- ---------------

     Total assets                                                    $    23,708,585 $    28,009,782
                                                                     =============== ===============

LIABILITIES AND SHAREHOLDER'S EQUITY
- ------------------------------------
Liabilities:
Reserves for future policy and contract benefits                     $       149,349 $        91,126
Accounts payable and accrued expenses                                        133,543         192,952
Income tax payable                                                             6,547               -
Deferred income taxes                                                              -          54,980
Payable to affiliates                                                          2,223         101,035
Future fees payable to American Skandia, Inc. ("ASI")                        708,249         799,472
Short-term borrowing                                                          10,000          10,000
Surplus notes                                                                110,000         144,000
Separate account liabilities                                              21,905,613      26,038,549
                                                                     --------------- ---------------

     Total liabilities                                                    23,025,524      27,432,114
                                                                     --------------- ---------------

Commitments and contingent liabilities (Note 18)

Shareholder's equity:
Common stock, $100 par value, 25,000 shares authorized,
   issued and outstanding                                                      2,500           2,500
Additional paid-in capital                                                   595,049         335,329
Retained earnings                                                             73,821         239,078
Accumulated other comprehensive income                                        11,691             761
                                                                     --------------- ---------------

     Total shareholder's equity                                              683,061         577,668
                                                                     --------------- ---------------

     Total liabilities and shareholder's equity                      $    23,708,585 $    28,009,782
                                                                     =============== ===============

                                          See notes to consolidated financial statements.


                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                              (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                                 Consolidated Statements of Income
                                                           (in thousands)

                                                                       For the Years Ended December 31,
                                                                      2002          2001           2000
                                                                      ----          ----           ----

REVENUES
- --------

Annuity and life insurance charges and fees                       $    370,004  $    388,696  $    424,578
Fee income                                                              97,650       111,196       130,610
Net investment income                                                   19,632        20,126        18,595
Net realized capital (losses) gains                                     (9,614)          928          (688)
Other                                                                    2,176         1,770         4,883
                                                                  ------------  ------------  ------------

   Total revenues                                                      479,848       522,716       577,978
                                                                  ------------  ------------  ------------


EXPENSES
- --------

Benefits:
   Annuity and life insurance benefits                                   3,391         1,955           751
   Change in annuity and life insurance policy reserves                  2,741       (39,898)       49,339
   Guaranteed minimum death benefit claims, net of hedge                23,256        20,370         2,618
   Return credited to contract owners                                    5,196         5,796         8,463
                                                                  ------------  ------------  ------------

     Total benefits                                                     34,584       (11,777)       61,171

Other:
   Underwriting, acquisition and other insurance
     expenses                                                          188,728       196,755       150,597
   Amortization of deferred acquisition costs                          510,059       224,047       184,616
   Interest expense                                                     14,544        73,424        85,998
                                                                  ------------  ------------  ------------

                                                                       713,331       494,226       421,211
                                                                  ------------  ------------  ------------

   Total benefits and expenses                                         747,915       482,449       482,382
                                                                  ------------  ------------  ------------

     (Loss) income from operations before income tax
(benefit) expense                                                     (268,067)       40,267        95,596

       Income tax (benefit) expense                                   (102,810)        7,168        30,779
                                                                  ------------  ------------  ------------

         Net (loss) income                                        $   (165,257) $     33,099  $     64,817
                                                                  ============  ============  ============


                                          See notes to consolidated financial statements.



                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                              (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                          Consolidated Statements of Shareholder's Equity
                                                           (in thousands)

                                                                                    Accumulated Other
                                                                                  Comprehensive Income
                                                                               ----------------------------
                                                                               -------------- -------------
                                                      Additional                  Foreign      Unrealized
                                          Common        Paid in    Retained      Currency        Gains
                                            Stock       Capital     Earnings    Translation     (Losses)       Total
                                          ----------- ------------ ----------- -------------- ------------- ------------
                                          ----------- ------------ ----------- -------------- ------------- ------------
 As of December 31, 1999                      $2,500     $215,879    $141,162        $148          ($255)      $359,434
Net income                                                             64,817                                    64,817
Other comprehensive income:
   Unrealized capital gains                                                                          843            843
   Reclassification adjustment for
realized losses included in net
realized capital (losses) gains                                                                      433            433
   Foreign currency translation                                                       (66)                          (66)
                                                                                                            ------------
                                                                                                            ------------
Other comprehensive income                                                                                        1,210
                                                                                                            ------------
                                                                                                            ------------
Comprehensive income                                                                                             66,027
Capital contributions                                      71,450                                                71,450
                                          ----------- ------------ ----------- -------------- ------------- ------------
                                          ----------- ------------ ----------- -------------- ------------- ------------
As of December 31, 2000                        2,500      287,329     205,979          82          1,021        496,911
Net income                                                             33,099                                    33,099
Other comprehensive loss:
   Unrealized capital losses                                                                        (261)          (261)
   Reclassification adjustment for
realized gains included in net
realized capital (losses) gains                                                                      (14)           (14)
   Foreign currency translation                                                       (67)                          (67)
                                                                                                            ------------
                                                                                                            ------------
Other comprehensive loss                                                                                           (342)
                                                                                                            ------------
                                                                                                            ------------
Comprehensive income                                                                                             32,757
Capital contributions                                      48,000                                                48,000
                                          ----------- ------------ ----------- -------------- ------------- ------------
                                          ----------- ------------ ----------- -------------- ------------- ------------
As of December 31, 2001                        2,500      335,329     239,078          15            746        577,668
Net loss                                                             (165,257)                                 (165,257)
Other comprehensive income:
   Unrealized capital gains                                                                       10,434         10,434
   Reclassification adjustment for
realized losses included in net
realized capital (losses) gains                                                                    1,126          1,126
   Foreign currency translation                                                      (630)                         (630)
                                                                                                            ------------
                                                                                                            ------------
Other comprehensive income                                                                                       10,930
                                                                                                            ------------
                                                                                                            ------------
Comprehensive loss                                                                                             (154,327)
Capital contributions                                     259,720                                               259,720
                                          ----------- ------------ ----------- -------------- ------------- ------------
                                          ----------- ------------ ----------- -------------- ------------- ------------
As of December 31, 2002                       $2,500     $595,049     $73,821       $(615)       $12,306       $683,061

Unrealized  capital  gains  (losses)  is shown net of tax  expense  (benefit)  of $5,618,  ($140) and $454 for 2002,  2001 and 2000,
respectively.  Reclassification  adjustment for realized  losses (gains)  included in net realized  capital  (losses) gains is shown
net of tax expense  (benefit) of $606, ($8) and $233 for 2002, 2001 and 2000,  respectively.  Foreign currency  translation is shown
net of tax benefit of $339, $36 and $36 for 2002, 2001 and 2000, respectively.




                                          See notes to consolidated financial statements.



                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                              (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                               Consolidated Statements of Cash Flows
                                                           (in thousands)

                                                                         For the Years Ended December 31,
                                                                           2002        2001        2000
                                                                           ----        ----        ----
Cash flow from operating activities:
   Net (loss) income                                                    $ (165,257) $   33,099  $   64,817
   Adjustments to reconcile net (loss) income to net
     cash (used in) provided by operating activities:
     Amortization and depreciation                                          21,649      13,374       5,758
     Deferral of acquisition costs                                        (244,322)   (209,136)   (495,103)
     Amortization of deferred acquisition costs                            510,059     224,047     184,616
     Deferred tax (benefit) expense                                        (99,071)     46,215      60,023
     Change in unrealized (gains) losses on derivatives                     (5,149)      2,902      (2,936)
     Increase (decrease) in policy reserves                                  3,293     (38,742)     50,892
     (Decrease) increase in net receivable/payable to affiliates           (99,490)    103,496     (72,063)
     Change in net income tax receivable/payable                            37,084       4,083     (58,888)
     Increase in other assets                                               (9,546)    (12,105)    (65,119)
     Decrease (increase) in accrued investment income                          541         472      (1,155)
     Decrease (increase) in reinsurance receivable                           2,286      (1,849)        420
     (Decrease) increase in accounts payable and accrued
expenses                                                                   (59,409)     55,912     (21,550)
     Net realized capital (gains) losses on derivatives                    (26,654)    (14,929)      5,554
     Net realized capital losses (gains) on investments                      9,616        (928)        688
                                                                        ----------  ----------  ----------
       Net cash (used in) provided by operating activities                (124,370)    205,911    (344,046)
                                                                        ----------  ----------  ----------

Cash flow from investing activities:
     Purchase of fixed maturity investments                               (388,053)   (462,820)   (380,737)
     Proceeds from sale and maturity of fixed
       maturity investments                                                367,263     390,816     303,736
     Purchase of derivatives                                               (61,998)   (103,533)    (14,781)
     Proceeds from exercise or sale of derivative instruments               88,956     113,051       5,936
     Purchase of shares in equity securities and dividend
reinvestments                                                              (49,713)    (55,430)    (18,136)
     Proceeds from sale of shares in equity securities                      34,220      25,228       8,345
     Purchase of fixed assets                                               (2,423)    (10,773)     (7,348)
     Increase in policy loans                                               (1,000)     (2,813)     (2,476)
                                                                        ----------  ----------  ----------
       Net cash used in investing activities                               (12,748)   (106,274)   (105,461)
                                                                        ----------  ----------  ----------

Cash flow from financing activities:
     Capital contribution                                                  259,720      48,000      71,450
     Pay down of surplus notes                                             (34,000)    (15,000)    (20,000)
     (Decrease) increase in future fees payable to ASI, net                (91,223)   (137,355)    358,376
     Deposits to contract owner accounts                                   808,209      59,681     172,441
     Withdrawals from contract owner accounts                             (164,964)   (130,476)   (102,603)
     Change in contract owner accounts, net of investment earnings        (588,315)     62,875     (55,468)
                                                                        ----------  ----------  ----------
       Net cash provided by (used in) financing activities                 189,427    (112,275)    424,196
                                                                        ----------  ----------  ----------

       Net increase (decrease) in cash and cash equivalents                 52,309     (12,638)    (25,311)
       Change in foreign currency translation                                 (970)       (103)       (101)
       Cash and cash equivalents at beginning of period                          -      12,741      38,153
       Cash and cash equivalents at end of period                       $   51,339  $        -  $   12,741
                                                                        ==========  ==========  ==========
     Income taxes (received) paid                                       $  (40,823) $  (43,130) $   29,644
                                                                        ==========  ==========  ==========
     Interest paid                                                      $   23,967  $   56,831  $  114,394
                                                                        ==========  ==========   =========
                                          See notes to consolidated financial statements.



                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                              (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                             Notes to Consolidated Financial Statements
                                                         December 31, 2002
                                                       (dollars in thousands)

1.       ORGANIZATION AND OPERATION

         American  Skandia  Life  Assurance  Corporation  ("ASLAC"  or the  "Company"),  with  its  principal  offices  in  Shelton,
         Connecticut,  is a wholly-owned  subsidiary of American  Skandia,  Inc.  ("ASI").  On December 19, 2002,  Skandia Insurance
         Company Ltd. (publ)  ("SICL"),  an insurance  company  organized under the laws of the Kingdom of Sweden,  and the ultimate
         parent company of the Company,  entered into a definitive purchase agreement with Prudential Financial,  Inc., a New Jersey
         corporation ("Prudential  Financial"),  whereby Prudential Financial will acquire the Company and certain of its affiliates
         (the  "Acquisition").  Consummation  of the  transaction is subject to various  closing  conditions,  including  regulatory
         approvals  and  approval of certain  matters by the board of directors  and  shareholders  of the mutual  funds  advised by
         American Skandia  Investment  Services,  Inc.  ("ASISI"),  a subsidiary of ASI. The transaction is expected to close during
         the second quarter of 2003.

         The  Company  develops  long-term  savings  and  retirement   products,   which  are  distributed  through  its  affiliated
         broker/dealer  company,  American Skandia Marketing,  Incorporated  ("ASM"). The Company currently issues term and variable
         universal life insurance and variable  deferred and immediate  annuities for individuals and groups in the United States of
         America and its territories.

         The Company has 99.9%  ownership  in Skandia  Vida,  S.A.  de C.V.  ("Skandia  Vida"),  which is a life  insurance  company
         domiciled in Mexico.  Skandia Vida had total  shareholder's  equity of $5,023 and $4,179 as of December 31, 2002, and 2001,
         respectively.  Skandia Vida has generated  net losses of $2,706,  $2,619 and $2,540 in 2002,  2001 and 2000,  respectively.
         As part of the  Acquisition,  it is expected  that the Company  will sell its  ownership  interest in Skandia Vida to SICL.
         The Company has filed for required  regulatory  approvals from the State of  Connecticut  and Mexico related to the sale of
         Skandia Vida.

2.       SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

         A.       Basis of Reporting
                  ------------------

                  The accompanying  consolidated  financial  statements have been prepared in conformity with accounting  principles
                  generally  accepted in the United States ("U.S.  GAAP").  Skandia Vida has been  consolidated  in these  financial
                  statements.  Intercompany  transactions  and balances between the Company and Skandia Vida have been eliminated in
                  consolidation.

                  Certain reclassifications have been made to prior year amounts to conform with the current year presentation.

         B.       New Accounting Standard
                  -----------------------

                  Effective January 1, 2001, the Company adopted Statement of Financial  Accounting  Standards No. 133,  "Accounting
                  for  Derivative  Instruments  and Hedging  Activities,"  as amended by SFAS 137 and SFAS 138  (collectively  "SFAS
                  133").  Derivative instruments held by the Company consist of equity put option contracts utilized to




                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                              (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                       Notes to Consolidated Financial Statements (continued)

2.       SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

                  manage  the  economic  risks  associated  with  guaranteed  minimum  death  benefits  ("GMDB").  These  derivative
                  instruments are carried at fair value.  Realized and unrealized  gains and losses are reported in the Consolidated
                  Statements  of Income,  together  with GMDB claims  expense,  as a component of  Guaranteed  Minimum Death Benefit
                  Claims,  Net of Hedge.  The  adoption of SFAS No. 133 did not have a material  effect on the  Company's  financial
                  statements.

                  Effective April 1, 2001, the Company adopted the Emerging Issues Task Force ("EITF") Issue 99-20,  "Recognition of
                  Interest Income and Impairment on Purchased and Retained  Beneficial  Interests in Securitized  Financial Assets."
                  Under the  consensus,  investors  in certain  asset-backed  securities  are  required  to record  changes in their
                  estimated  yield on a prospective  basis and to evaluate these  securities for an other than temporary  decline in
                  value.  If the fair value of the  asset-backed  security has declined below its carrying amount and the decline is
                  determined  to be other than  temporary,  the security is written  down to fair value.  The adoption of EITF Issue
                  99-20 did not have a significant effect on the Company's financial statements.

                  In July 2001,  the  Financial  Accounting  Standards  Board  ("FASB")  issued  Statement of  Financial  Accounting
                  Standards.  No. 142  "Accounting  for  Goodwill and  Intangible  Assets"  ("SFAS  142").  Under the new  standard,
                  goodwill and intangible  assets deemed to have indefinite lives will no longer be amortized but will be subject to
                  annual  impairment  tests in  accordance  with the new  standard.  Other  intangible  assets  will  continue to be
                  amortized over their useful lives.

                  The Company applied the new rules on the accounting for goodwill and other intangible  assets in the first quarter
                  of 2002.  The adoption of SFAS 142 did not have a significant impact on the Company's financial statements.

         C.       Investments
                  -----------

                  The Company has classified its fixed maturity investments as available-for-sale  and, as such, they are carried at
                  fair value with changes in unrealized gains and losses reported as a component of other comprehensive income.

                  The Company has classified its equity securities held in support of a deferred  compensation plan (see Note 12) as
                  available-for-sale.  Such  investments  are  carried  at fair value with  changes in  unrealized  gains and losses
                  reported as a component of other comprehensive income.

                  Policy loans are carried at their unpaid principal balances.

                  Realized capital gains and losses on disposal of investments are determined by the specific identification method.

                  Other than temporary  impairment  charges are  determined  based on an analysis that is performed on a security by
                  security basis and includes quantitative and qualitative factors.



                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                              (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                       Notes to Consolidated Financial Statements (continued)

2.       SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

         D.       Derivative Instruments
                  ----------------------

                  The Company  uses  derivative  instruments,  which  consist of equity put option  contracts,  for risk  management
                  purposes,  and not for trading or  speculation.  The Company  hedges the economic  GMDB exposure  associated  with
                  equity  market  fluctuations.  As the equity  markets  decline,  the  Company's  exposure  to future  GMDB  claims
                  increases.  Conversely,  as the equity markets  increase the Company's  exposure to future GMDB claims  decreases.
                  The claims exposure is reduced by the market value effect of the option contracts purchased.

                  Based on criteria  described in SFAS 133, the  Company's  fair value hedges do not qualify as  "effective"  hedges
                  and, therefore, hedge accounting may not be applied.  Accordingly,  the derivative investments are carried at fair
                  value with changes in unrealized  gains and losses being recorded in income as those changes occur.  As such, both
                  realized and  unrealized  gains and losses are reported in the  Consolidated  Statements of Income,  together with
                  GMDB claims expense, as a component of Guaranteed Minimum Death Benefit Claims, Net of Hedge.

                  As of December 31, 2002 and 2001,  the  accumulated  difference  between  cost and market  value on the  Company's
                  derivatives  was an  unrealized  gain of $1,434  and an  unrealized  loss of $3,715,  respectively.  The amount of
                  realized and unrealized gains (losses) on the Company's  derivatives  recorded during the years ended December 31,
                  2002, 2001 and 2000 was $31,803, $12,027 and ($2,619), respectively.

         E.       Cash Equivalents
                  ----------------

                  The Company  considers all highly liquid time deposits,  commercial  paper and money market mutual funds purchased
                  with a maturity date, at acquisition, of three months or less to be cash equivalents.

                  As of December 31, 2002, $50 of cash reflected on the Company's financial  statements was restricted in compliance
                  with regulatory requirements.

         F.       State Insurance Licenses
                  ------------------------

                  Licenses to do business in all states have been  capitalized  and  reflected at the purchase  price of $6,000 less
                  accumulated  amortization  of $2,038 at  December  31,  2002.  Due to the  adoption  of SFAS 142,  the cost of the
                  licenses is no longer being  amortized  but is subjected to an annual  impairment  test.  As of December 31, 2002,
                  the  Company  estimated  the fair  value of the  state  insurance  licenses  to be in excess  of book  value  and,
                  therefore, no impairment charge was required.






                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                              (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                       Notes to Consolidated Financial Statements (continued)

2.       SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

         G.       Income Taxes
                  ------------

                  The Company is included in the  consolidated  federal  income tax return filed by Skandia  U.S.  Inc. and its U.S.
                  subsidiaries.  In accordance  with the tax sharing  agreement,  the federal  income tax provision is computed on a
                  separate return basis as adjusted for  consolidated  items.  Pursuant to the terms of this agreement,  the Company
                  has the right to recover the value of losses utilized by the  consolidated  group in the year of  utilization.  To
                  the extent the Company  generates  income in future years,  the Company is entitled to offset future taxes on that
                  income through the application of its loss carry forward generated in the current year.

                  Deferred income taxes reflect the net tax effects of temporary  differences between the carrying amounts of assets
                  and liabilities for financial reporting purposes and the amounts used for income tax purposes.

         H.       Recognition of Revenue and Contract Benefits
                  --------------------------------------------

                  Revenues for variable  deferred  annuity  contracts  consist of charges  against  contract owner account values or
                  separate  accounts  for  mortality  and  expense  risks,  administration  fees,  surrender  charges  and an annual
                  maintenance  fee per  contract.  Revenues  for  mortality  and expense risk  charges and  administration  fees are
                  recognized as assessed  against the contract  holder.  Surrender  charge revenue is recognized  when the surrender
                  charge is assessed  against the  contract  holder at the time of  surrender.  Annual  maintenance  fees are earned
                  ratably throughout the year.

                  Benefit  reserves for the variable  investment  options on annuity  contracts  represent  the account value of the
                  contracts and are included in the separate account liabilities.

                  Fee income from mutual fund organizations is recognized when assessed against assets under management.

                  Revenues for variable  immediate annuity and supplementary  contracts with life  contingencies  consist of certain
                  charges  against  contract owner account values  including  mortality and expense risks and  administration  fees.
                  These charges and fees are recognized as revenue as assessed  against the contract  holder.  Benefit  reserves for
                  variable  immediate  annuity  contracts  represent  the account  value of the  contracts  and are  included in the
                  separate account liabilities.

                  Revenues for the market value adjusted fixed investment  option on annuity  contracts  consist of separate account
                  investment  income reduced by amounts  credited to the contract  holder for interest.  This net spread is included
                  in return  credited to contract  owners on the  consolidated  statements  of income.  Benefit  reserves  for these
                  contracts represent the account value of the contracts plus a




                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                              (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                       Notes to Consolidated Financial Statements (continued)

2.       SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

                  market value  adjustment,  and are included in the general account reserve for future policy and contract benefits
                  to the  extent in excess of the  separate  account  assets,  typically  for the  market  value  adjustment  at the
                  reporting date.

                  Revenues for fixed immediate annuity and fixed supplementary  contracts without life contingencies  consist of net
                  investment  income,  reported as a component of return credited to contract  owners.  Revenues for fixed immediate
                  annuity contracts with life contingencies consist of single premium payments recognized as annuity  considerations
                  when  received.  Benefit  reserves for these  contracts are based on applicable  actuarial  standards with assumed
                  interest  rates that vary by issue year and are  included in the  general  account  reserve for future  policy and
                  contract benefits.  Assumed interest rates ranged from 6.25% to 8.25% at December 31, 2002 and 2001.

                  Revenues for variable life  insurance  contracts  consist of charges  against  contract  owner  account  values or
                  separate  accounts for mortality and expense risk fees,  administration  fees, cost of insurance  fees,  taxes and
                  surrender  charges.  Certain  contracts also include charges  against  premium to pay state premium taxes.  All of
                  these charges are recognized as revenue when assessed against the contract  holder.  Benefit reserves for variable
                  life  insurance  contracts  represent the account value of the contracts and are included in the separate  account
                  liabilities.

         I.       Deferred Acquisition Costs
                  --------------------------

                  The costs of acquiring new  business,  which vary with and are primarily  related to new business  generated,  are
                  being  deferred,  net of  reinsurance.  These  costs  include  commissions,  purchase  credits,  costs of contract
                  issuance, and certain selling expenses that vary with production.

                  The Company uses the retrospective  deposit method for amortizing deferred  acquisition costs. This method results
                  in deferred acquisition costs being amortized in proportion to expected gross profits,  from surrender charges and
                  policy and asset based fees,  net of operating and claim costs.  The deferred  acquisition  cost asset is adjusted
                  retrospectively  and prospectively  when estimates of current and future gross profits to be realized from a group
                  of products  are  revised.  Critical  assumptions  in  estimating  gross  profits  include  those for  surrenders,
                  long-term  fund  growth  rate,  expenses  and death  benefits.  The  long-term  fund growth  rate,  in large part,
                  determines  the  estimated  future asset levels on which the most  significant  revenues are based.  The Company's
                  long-term  fund growth rate  assumption is 8% (net of charges  assessed  against the  underlying  mutual fund, but
                  before charges assessed at the separate  account and contract  level).  When current period actual asset growth is
                  greater or less than the Company's long-term expectation,  the Company adjusts the short-term asset growth rate to
                  a level that will allow the Company,  in the short-term,  to resume the long-term  asset growth rate  expectation.
                  The short-term asset growth rate is subject to constraints surrounding actual market conditions.




                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                              (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                       Notes to Consolidated Financial Statements (continued)

2.       SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

                  Details of deferred acquisition costs and related amortization for the years ended December 31, are as follows:

                                                                 2002            2001            2000
                                                                 ----            ----            ----
                  Balance at beginning of year              $   1,383,281   $   1,398,192   $   1,087,705
                  Acquisition costs deferred during the
                       year                                       244,322         209,136         495,103
                  Acquisition costs amortized during the
                       year                                      (510,059)       (224,047)       (184,616)
                                                            -------------   -------------   -------------
                  Balance at end of year                    $   1,117,544   $   1,383,281   $   1,398,192
                                                            =============   =============   =============


                  As asset  growth  rates,  during  2002 and  2001,  have been far below the  Company's  long-term  assumption,  the
                  adjustment to the short-term  asset growth rate had risen to a level,  before being capped,  that in  management's
                  opinion was excessive in the current  market  environment.  Based on an analysis of those  short-term  rates,  the
                  related estimates of future gross profits and an impairment study,  management of the Company  determined that the
                  short-term  asset  growth  rate  should be reset to the  level of the  long-term  growth  rate  expectation  as of
                  September 30, 2002.  This resulted in an acceleration of amortization of approximately $206,000.

                  Throughout  the year,  the Company  also  updated  its future  estimated  gross  profits  with  respect to certain
                  mortality  assumptions  reflecting actual experience and the decline in the equity markets resulting in additional
                  increased amortization of approximately $72,000.

         J.       Reinsurance
                  -----------

                  The Company cedes reinsurance under modified  co-insurance  arrangements.  These reinsurance  arrangements provide
                  additional  capacity  for growth in  supporting  the cash flow  strain  from the  Company's  variable  annuity and
                  variable life insurance business.  The reinsurance is effected under quota share contracts.

                  At December 31, 2002 and 2001,  in accordance  with the  provisions of the modified  coinsurance  agreements,  the
                  Company accrued approximately $5,447 and $7,733,  respectively,  for amounts receivable from favorable reinsurance
                  experience on certain blocks of variable annuity business.

         K.       Translation of Foreign Currency
                  -------------------------------

                  The  financial  position  and results of  operations  of Skandia  Vida are  measured  using local  currency as the
                  functional  currency.  Assets and  liabilities  are  translated at the exchange  rate in effect at each  year-end.
                  Statements of income and changes in  shareholder's  equity  accounts are translated at the average rate prevailing
                  during the year.  Translation  adjustments  arising from the use of differing exchange rates from period to period
                  are reported as a component of other comprehensive income.


                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                              (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                       Notes to Consolidated Financial Statements (continued)

2.       SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

         L.       Separate Accounts
                  -----------------

                  Assets and liabilities in separate  accounts are included as separate  captions in the consolidated  statements of
                  financial  condition.  Separate  account  assets  consist  principally  of long term bonds,  investments in mutual
                  funds,  short-term  securities  and  cash and cash  equivalents,  all of which  are  carried  at fair  value.  The
                  investments  are managed  predominately  through  ASISI,  utilizing  various fund  managers as  sub-advisors.  The
                  remaining  investments  are  managed  by  independent  investment  firms.  The  contract  holder has the option of
                  directing  funds to a wide variety of investment  options,  most of which invest in mutual funds.  The  investment
                  risk on the  variable  portion  of a  contract  is  borne by the  contract  holder.  Fixed  options  with  minimum
                  guaranteed  interest rates are also  available.  The Company bears the credit risk associated with the investments
                  that support these fixed options.

                  Included in Separate Account  liabilities are reserves of $1,828,048 and $1,092,944 at December 31, 2002 and 2001,
                  respectively,  relating to deferred annuity investment options for which the contract holder is guaranteed a fixed
                  rate of  return.  These  reserves  are  calculated  using the  Commissioners  Annuity  Reserve  Valuation  Method.
                  Separate  Account assets of $1,828,048 and $1,092,944 at December 31, 2002 and 2001,  respectively,  consisting of
                  fixed maturities, equity securities,  short-term securities, cash and cash equivalents, accrued investment income,
                  accrued liabilities and amounts due to/from the General Account are held in support of these annuity  obligations,
                  pursuant to state regulation.

                  Included in the general  account,  within  Reserves for Future Policy and Contract  Benefits,  is the market value
                  adjustment associated with the guaranteed,  fixed rate investment options, assuming the market value adjustment at
                  the reporting date.

                  Net investment  income (including net realized capital gains and losses) and interest credited to contract holders
                  on separate account assets are not separately reflected in the Consolidated Statements of Income.

         M.       Unearned Performance Credits
                  ----------------------------

                  The Company  defers  certain  bonus  credits  applied to  contract  holder  deposits.  The credit is reported as a
                  contract holder liability within separate account  liabilities and the deferred expense is reported as a component
                  of other  assets.  As the contract  holder must keep the contract  in-force for 10 years to earn the bonus credit,
                  the Company  amortizes  the  deferred  expense on a  straight-line  basis over 10 years.  If the  contract  holder
                  surrenders the contract or the contract holder dies prior to the end of 10 years,  the bonus credit is returned to
                  the  Company.  This  component  of the bonus  credit  is  amortized  in  proportion  to  expected  surrenders  and
                  mortality.  As of December  31, 2002 and 2001,  the  unearned  performance  credit  asset was $83,288 and $89,234,
                  respectively.



                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                              (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                       Notes to Consolidated Financial Statements (continued)

2.       SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)

         N.       Estimates
                  ---------

                  The  preparation of financial  statements in conformity with U.S. GAAP requires that management make estimates and
                  assumptions that affect the reported amount of assets and liabilities at the date of the financial  statements and
                  the reported  amounts of revenues and expenses during the reporting  period.  The more  significant  estimates and
                  assumptions are related to deferred  acquisition costs and involve  estimates of future policy lapses,  investment
                  returns and maintenance expenses.  Actual results could differ from those estimates.

3.       INVESTMENTS

         The  amortized  cost,  gross  unrealized  gains and losses and fair value of fixed  maturities  and  investments  in equity
         securities  as of December  31,  2002 and 2001 are shown  below.  All  securities  held at December  31, 2002 and 2001 were
         publicly traded.

         Investments in fixed maturities as of December 31, 2002 consisted of the following:

                                                                     Gross          Gross
                                                    Amortized     Unrealized     Unrealized
                                                      Cost           Gains         Losses       Fair Value
                                                      ----           -----         ------       ----------
         U.S. Government obligations              $    270,969   $    15,658       $    (78)   $    286,549
         Obligations of state and political
           subdivisions                                    253             9             (1)            261
         Corporate securities                          108,200         3,631            (40)        111,791
                                                  ------------   -----------       --------    ------------
              Totals                              $    379,422   $    19,298       $   (119)   $    398,601
                                                  ============   ===========       ========    ============


         The amortized  cost and fair value of fixed  maturities,  by  contractual  maturity,  at December 31, 2002 are shown below.
         Actual maturities may differ from contractual maturities due to call or prepayment provisions.

                                                       Amortized
                                                          Cost      Fair Value
                                                          ----      ----------
         Due in one year or less                      $    12,793   $    12,884
         Due after one through five years                 165,574       171,830
         Due after five through ten years                 186,609       198,913
         Due after ten years                               14,446        14,974
                                                      -----------   -----------
           Total                                      $   379,422   $   398,601
                                                      ===========   ===========








                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                              (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                       Notes to Consolidated Financial Statements (continued)

3.       INVESTMENTS (continued)

         Investments in fixed maturities as of December 31, 2001 consisted of the following:

                                                                     Gross          Gross
                                                    Amortized     Unrealized     Unrealized
                                                      Cost           Gains         Losses       Fair Value
                                                      ----           -----         ------       ----------
         U.S. Government obligations                 $198,136         $2,869          $(413)      $200,592
         Obligations of state and political
           subdivisions                                   252              8              -            260
         Corporate securities                         158,494          4,051           (566)       161,979
                                                   ----------        -------         ------     ----------
              Totals                                 $356,882         $6,928          $(979)      $362,831
                                                     ========         ======          =====       ========

         Proceeds from sales of fixed  maturities  during 2002,  2001 and 2000 were $367,213,  $386,816 and $302,632,  respectively.
         Proceeds from maturities during 2002, 2001 and 2000 were $50, $4,000 and $1,104, respectively.

         The cost, gross unrealized gains/losses and fair value of investments in equity securities at December 31 are shown below:

                                                           Gross          Gross
                                                        Unrealized     Unrealized        Fair
                                            Cost           Gains         Losses          Value
                                            ----           -----         ------          -----
         2002                             $ 52,017         $ 136        $    (384)     $ 51,769
         2001                             $  49,886        $ 122        $ (4,925)      $ 45,083

         Net realized  investment  gains  (losses),  determined on a specific  identification  basis,  were as follows for the years
         ended December 31:

                                                          2002          2001           2000
                                                          ----          ----           ----
         Fixed maturities:
           Gross gains                                $    8,213      $  8,849       $  1,002
           Gross losses                                   (4,468)       (4,387)        (3,450)

         Investment in equity securities:
           Gross gains                                        90           658          1,913
           Gross losses                                  (13,451)       (4,192)          (153)
                                                      ----------      --------       --------

              Totals                                  $   (9,616)     $    928       $   (688)
                                                      ==========      ========       ========

         During  2002,  the  Company  determined  that  certain  amounts  of its  investment  in equity  securities  were other than
         temporarily impaired and, accordingly, recorded a loss of $3,769.

         As of December  31, 2002,  the Company did not own any  investments  in fixed  maturity  securities  whose  carrying  value
         exceeded 10% of the Company's equity.





                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                              (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                       Notes to Consolidated Financial Statements (continued)

3.       INVESTMENTS (continued)

         As of December 31, 2002, the following fixed maturities were restricted in compliance with regulatory requirements:

         Security                                                      Fair Value
         --------                                                      ----------
         U.S. Treasury Note, 6.25%, February 2003                           $4,345
         U.S. Treasury Note, 3.00%, November 2003                              183
         Puerto Rico Commonwealth, 4.60%, July 2004                            210
         Puerto Rico Commonwealth, 4.875%, July 2023                            52

4.       FAIR VALUES OF FINANCIAL INSTRUMENTS

         The methods and assumptions used to determine the fair value of financial instruments are as follows:

         Fair values of fixed  maturities  with active markets are based on quoted market prices.  For fixed  maturities  that trade
         in less active markets, fair values are obtained from an independent pricing service.

         Fair values of equity securities are based on quoted market prices.

         The fair value of derivative instruments is determined based on the current value of the underlying index.

         The carrying  value of cash and cash  equivalents  (cost)  approximates  fair value due to the  short-term  nature of these
         investments.

         The carrying value of policy loans approximates fair value.

         Fair value of future fees payable to ASI are determined on a discounted  cash flow basis,  using best estimate  assumptions
         of lapses, mortality, free withdrawals and a long-term fund growth rate of 8% on the Company's assets under management.

         The  carrying  value of  short-term  borrowings  (cost)  approximates  fair  value  due to the  short-term  nature of these
         liabilities.

         Fair value of surplus  notes are  determined  based on a discounted  cash flow basis with a projected  payment of principal
         and all accrued interest at the maturity date (see Note 14 for payment restrictions).




                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                              (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                       Notes to Consolidated Financial Statements (continued)

4.       FAIR VALUES OF FINANCIAL INSTRUMENTS (continued)

         The fair values and carrying values of financial instruments at December 31, 2002 and 2001 are as follows:

                                                   December 31, 2002                December 31, 2001
                                                   -----------------                -----------------
                                             Fair Value     Carrying Value    Fair Value     Carrying Value
                                           -------------- ------------------ ------------- ------------------
                                           -------------- ------------------ ------------- ------------------
        Assets
        ------
        Fixed Maturities                         $398,601           $398,601      $362,831           $362,831
        Equity Securities                          51,769             51,769        45,083             45,083
        Derivative Instruments                     10,370             10,370         5,525              5,525
        Policy Loans                                7,559              7,559         6,559              6,559

        Liabilities
        -----------
        Future Fees Payable to ASI                429,773            708,249       546,357            799,472
        Short-term Borrowing                       10,000             10,000        10,000             10,000
        Surplus Notes and accrued
           interest of $29,230 and
           $25,829 in 2002 and 2001,
           respectively                           140,777            139,230       174,454            169,829

5.       NET INVESTMENT INCOME

         The sources of net investment income for the years ended December 31 were as follows:

                                                          2002          2001           2000
                                                          ----          ----           ----
         Fixed maturities                              $  18,015     $  18,788      $  13,502
         Cash and cash equivalents                         1,116           909          5,209
         Equity securities                                   809           622             99
         Policy loans                                        403           244             97
                                                      ----------    ----------     ----------
         Total investment income                          20,343        20,563         18,907
         Investment expenses                                (711)         (437)          (312)
                                                      ----------    ----------     ----------
         Net investment income                         $19,632       $  20,126      $  18,595
                                                       ========      ========= ==   =========


6.       INCOME TAXES

         The significant components of income tax expense for the years ended December 31 were as follows:

                                                            2002          2001         2000
                                                            ----          ----         ----
         Current tax benefit                            $    (3,739)   $  (39,047)  $   (29,244)
         Deferred tax expense, excluding operating
           loss carryforwards                                35,915        60,587        60,023
         Deferred tax benefit for operating and
           capital loss carryforwards                      (134,986)      (14,372)            -
                                                        -----------    ----------   -----------
              Total income tax (benefit) expense        $  (102,810)   $    7,168   $    30,779
                                                        ===========    ==========   ===========





                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                              (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                           Notes to Consolidated Financial Statements (continued)

6.       INCOME TAXES (continued)

         Deferred tax assets (liabilities) include the following at December 31:

                                                           2002          2001
                                                           ----          ----
         Deferred tax assets:
           GAAP to tax reserve differences             $   165,348   $   241,503
           Future fees payable to ASI                       21,475        63,240
           Deferred compensation                            20,603        20,520
           Net operating loss carry forward                147,360        14,372
           Other                                             6,530        17,276
                                                       -----------   -----------
              Total deferred tax assets                    361,316       356,911
                                                       -----------   -----------

         Deferred tax liabilities:
           Deferred acquisition costs, net                (312,933)     (404,758)
           Net unrealized gains on fixed
              maturity securities                           (6,713)       (2,082)
           Other                                            (3,464)       (5,051)
                                                       -----------   -----------
              Total deferred tax liabilities              (323,110)     (411,891)
                                                       -----------   -----------
                Net deferred tax asset (liability)     $    38,206   $   (54,980)
                                                       ===========   ===========

         In  accordance  with SFAS 109, the Company has  performed an analysis of its deferred tax assets to assess  recoverability.
         Looking at a variety of items,  most  notably,  the timing of the reversal of  temporary  items and future  taxable  income
         projections, the Company determined that no valuation allowance is needed.

         The income tax (benefit)  expense was different from the amount computed by applying the federal  statutory tax rate of 35%
         to pre-tax income from continuing operations as follows:

                                                                   2002            2001           2000
                                                                   ----            ----           ----
         (Loss) income before taxes
           Domestic                                           $   (265,361)   $   42,886      $   98,136
           Foreign                                                  (2,706)       (2,619)         (2,540)
                                                              ------------    ----------      ----------
           Total                                                  (268,067)       40,267          95,596
           Income tax rate                                              35%           35%             35%
                                                              -------------   -----------     -----------
         Tax (benefit) expense at federal statutory income
           tax rate                                                (93,823)       14,093          33,459

         Tax effect of:
           Dividend received deduction                             (12,250)       (8,400)         (7,350)
           Losses of foreign subsidiary                                947           917             889
           Meals and entertainment                                     603           603             841
           State income taxes                                            -           (62)           (524)
           Federal provision to return differences                     709          (177)          3,235
           Other                                                     1,004           194             229
                                                              ------------    ----------      ----------
              Income tax (benefit) expense                    $   (102,810)   $    7,168      $   30,779
                                                              ============    ==========      ==========

         The Company's net operating loss carry  forwards,  totaling  approximately  $421,029  (pre-tax) at December 31, 2002,  will
         expire in 2016 and 2017.



                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                              (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                       Notes to Consolidated Financial Statements (continued)

7.       COST ALLOCATION AGREEMENTS WITH AFFILIATES

         Certain  operating costs (including rental of office space,  furniture,  and equipment) have been charged to the Company at
         cost by American Skandia Information Services and Technology  Corporation  ("ASIST"),  an affiliated company.  ASLAC signed
         a written service  agreement with ASIST for these services  executed and approved by the Connecticut  Insurance  Department
         in 1995.  This  agreement  automatically  continues in effect from year to year and may be  terminated by either party upon
         30 days written  notice.  The Company has also paid and charged  operating  costs to several of its  affiliates.  The total
         cost to the Company for these items was $8,177,  $6,179 and $13,974 in 2002, 2001 and 2000,  respectively.  Income received
         for these items was approximately $13,052, $13,166 and $11,186 in 2002, 2001 and 2000, respectively.

         Allocated  depreciation  expense  was  $7,440,  $8,764 and $9,073 in 2002,  2001 and 2000,  respectively.  Allocated  lease
         expense was $5,808,  $6,517 and $5,606 in 2002, 2001 and 2000,  respectively.  Allocated sub-lease rental income,  recorded
         as a reduction to lease  expense,  was $738,  $30 and $0 in 2002,  2001 and 2000,  respectively.  Assuming that the written
         service  agreement  between ASLAC and ASIST continues  indefinitely,  ASLAC's  allocated  future minimum lease payments and
         sub-lease receipts per year and in aggregate as of December 31, 2002 are as follows:

                                                                       Lease         Sub-Lease
                                                                       -----         ---------
                                  2003                            $     4,847      $     1,616
                                  2004                                  5,275            1,773
                                  2005                                  5,351            1,864
                                  2006                                  5,328            1,940
                                  2007                                  5,215            1,788
                                  2008 and thereafter                  19,629            7,380
                                                                  -----------      -----------
                                  Total                           $    45,645      $    16,361
                                                                  ===========      ===========


         Beginning in 1999, the Company was reimbursed by ASM for certain  distribution  related costs  associated with the sales of
         business through an investment firm where ASM serves as an introducing  broker dealer.  Under this agreement,  the expenses
         reimbursed  were  $8,255,  $6,610  and $6,064 in 2002,  2001 and 2000,  respectively.  As of  December  31,  2002 and 2001,
         amounts receivable under this agreement were approximately $458 and $639, respectively.














                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                              (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                       Notes to Consolidated Financial Statements (continued)

8.       FUTURE FEES PAYABLE TO ASI

         In a series of  transactions  with ASI,  the  Company  transferred  certain  rights to receive a portion of future fees and
         contract charges expected to be realized on designated blocks of deferred annuity contracts.

         The proceeds from the transfers  have been recorded as a liability  and are being  amortized  over the remaining  surrender
         charge period of the  designated  contracts  using the interest  method.  The Company did not transfer the right to receive
         future fees and charges after the expiration of the surrender charge period.

         In connection  with these  transactions,  ASI,  through  special purpose  trusts,  issued  collateralized  notes in private
         placements, which are secured by the rights to receive future fees and charges purchased from the Company.

         Under the terms of the securitization  purchase agreements,  the rights transferred provide for ASI to receive a percentage
         (60%, 80% or 100% depending on the underlying  commission  option) of future  mortality and expense  charges and contingent
         deferred  sales  charges,  after  reinsurance,  expected to be realized over the remaining  surrender  charge period of the
         designated  contracts  (generally 6 to 8 years).  The liability for future fees payable to ASI at the balance sheet date is
         based on the consideration  received less principal repayments  according to amortization  schedules that were developed at
         the inception of the  transactions.  If actual  mortality and expense  charges and  contingent  deferred  sales charges are
         less than those projected in the original  amortization  schedules,  calculated on a transaction by transaction  basis, ASI
         has no  recourse  against  the  Company.  As  account  values  associated  with the  designated  contracts  have  declined,
         consistent  with the overall  decline in the equity  markets,  current  mortality and expense  charges have been lower than
         expected on certain  transactions and it is likely that future mortality and expense charges,  on those same  transactions,
         will be lower than originally  projected.  As a result,  the ultimate cash flows  associated with these  transactions  that
         will transfer to ASI may be lower than the current carrying amount of the liability (see Note 4).

         On April 12, 2002, the Company  entered into a new  securitization  purchase  agreement with ASI. This  transaction  covers
         designated  blocks of business issued from November 1, 2000 through  December 31, 2001. The estimated  present value of the
         transaction at April 12, 2002, using a discount rate of 6.00%, was $101,713.

         Payments,  representing  fees and charges in the  aggregate  amount,  of $186,810,  $207,731 and $219,523  were made by the
         Company to ASI in 2002,  2001 and 2000,  respectively.  Related  interest  expense of $828,  $59,873  and  $70,667 has been
         included in the consolidated statements of income for 2002, 2001 and 2000, respectively.

         The  Commissioner of the State of Connecticut has approved the transfer of future fees and charges;  however,  in the event
         that the  Company  becomes  subject to an order of  liquidation  or  rehabilitation,  the  Commissioner  has the ability to
         restrict the payments due to ASI,  into a restricted  account,  under the Purchase  Agreement  subject to certain terms and
         conditions.



                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                              (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                       Notes to Consolidated Financial Statements (continued)

8.       FUTURE FEES PAYABLE TO ASI (continued)

         The present values of the transactions as of the respective effective date were as follows:

                              Closing      Effective        Contract Issue        Discount       Present
           Transaction         Date          Date               Period              Rate          Value
           -----------         ----          ----               ------              ----          -----

             1996-1           12/17/96        9/1/96        1/1/94 - 6/30/96        7.5%          $50,221
             1997-1            7/23/97        6/1/97        3/1/96 - 4/30/97        7.5%           58,767
             1997-2           12/30/97       12/1/97        5/1/95 - 12/31/96       7.5%           77,552
             1997-3           12/30/97       12/1/97        5/1/96 - 10/31/97       7.5%           58,193
             1998-1            6/30/98        6/1/98        1/1/97 - 5/31/98        7.5%           61,180
             1998-2           11/10/98       10/1/98        5/1/97 - 8/31/98        7.0%           68,573
             1998-3           12/30/98       12/1/98        7/1/96 - 10/31/98       7.0%           40,128
             1999-1            6/23/99        6/1/99        4/1/94 - 4/30/99        7.5%          120,632
             1999-2           12/14/99       10/1/99       11/1/98 - 7/31/99        7.5%          145,078
             2000-1            3/22/00        2/1/00        8/1/99 - 1/31/00        7.5%          169,459
             2000-2            7/18/00        6/1/00        2/1/00 - 4/30/00        7.25%          92,399
             2000-3           12/28/00       12/1/00        5/1/00 - 10/31/00       7.25%         107,291
             2000-4           12/28/00       12/1/00        1/1/98 - 10/31/00       7.25%         107,139
             2002-1            4/12/02        3/1/02       11/1/00 - 12/31/01       6.00%         101,713

         Payments of future fees  payable to ASI,  according  to original  amortization  schedules,  as of December  31, 2002 are as
         follows:

                                          Year         Amount
                                          ----         ------

                                          2003      $   186,854
                                          2004          171,093
                                          2005          147,902
                                          2006          117,761
                                          2007           66,270
                                          2008           18,369
                                                    -----------
                                          Total     $   708,249
                                                    ===========




                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                              (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                       Notes to Consolidated Financial Statements (continued)

9.       LEASES

         The Company  entered into an eleven year lease agreement for office space in Westminster,  Colorado,  effective  January 1,
         2001.  Lease expense for 2002 and 2001 was $2,583 and $1,602,  respectively.  Sub-lease  rental income was $227 in 2002 and
         $0 in 2001.  Future  minimum lease  payments and  sub-lease  receipts per year and in aggregate as of December 31, 2002 are
         as follows:

                                                                       Lease           Sub-Lease
                                                                       -----           ---------
                                   2003                          $    1,913         $      426
                                   2004                               1,982                455
                                   2005                               2,050                500
                                   2006                               2,050                533
                                   2007                               2,050                222
                                   2008 and thereafter                8,789                  0
                                                                 ----------         ----------
                                   Total                         $   18,834         $    2,136
                                                                 ==========         ==========


10.      RETAINED EARNINGS AND DIVIDEND RESTRICTIONS

         Statutory basis shareholder's equity was $279,957 and $226,780 at December 31, 2002 and 2001, respectively.

         The Company  incurred  statutory  basis net losses in 2002 of $192,474 due primarily to significant  declines in the equity
         markets,  increasing GMDB reserves calculated on a statutory basis.  Statutory basis net losses for 2001 were $121,957,  as
         compared to income of $11,550 in 2000.

         Under  various  state  insurance  laws,  the maximum  amount of dividends  that can be paid to  shareholders  without prior
         approval of the state  insurance  department  is subject to  restrictions  relating to statutory  surplus and net gain from
         operations.  For 2003, no amounts may be distributed without prior approval.

11.      STATUTORY ACCOUNTING PRACTICES

         The Company  prepares its statutory basis financial  statements in accordance with accounting  practices  prescribed by the
         State  of  Connecticut  Insurance  Department.  Prescribed  statutory  accounting  practices  include  publications  of the
         National  Association of Insurance  Commissioners  (NAIC),  as well as state laws,  regulations and general  administrative
         rules.

         The NAIC adopted the  Codification  of Statutory  Accounting  Principles  (Codification)  in March 1998. The effective date
         for  codification  was January 1, 2001. The Company's  state of domicile,  Connecticut,  has adopted  codification  and the
         Company has made the  necessary  changes in its  statutory  accounting  and  reporting  required  for  implementation.  The
         overall impact of adopting  codification in 2001 was a one-time,  cumulative change in accounting benefit recorded directly
         in statutory surplus of $12,047.

         In addition,  during 2001,  based on a  recommendation  from the State of  Connecticut  Insurance  Department,  the Company
         changed its statutory method of accounting for its



                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                              (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                       Notes to Consolidated Financial Statements (continued)

11.      STATUTORY ACCOUNTING PRACTICES (continued)

         liability  associated  with  securitized  variable  annuity  fees.  Under the new method of  accounting,  the liability for
         securitized  fees is  established  consistent  with the method of  accounting  for the liability  associated  with variable
         annuity fees ceded under  reinsurance  contracts.  This equates to the  statutory  liability  at any  valuation  date being
         equal to the  Commissioners  Annuity  Reserve  Valuation  Method (CARVM) offset related to the securitized  contracts.  The
         impact of this change in accounting,  representing  the difference in the liability  calculated under the old method versus
         the new  method as of January 1, 2001,  was  reported  as a  cumulative  effect of change in  accounting  benefit  recorded
         directly in statutory surplus of approximately $20,215.

         In 2001,  the Company,  in agreement  with the  Connecticut  Insurance  Department,  changed its reserving  methodology  to
         recognize free partial  withdrawals  and to reserve on a  "continuous"  rather than  "curtate"  basis.  The impact of these
         changes,  representing  the difference in reserves  calculated  under the new methods versus the old methods,  was recorded
         directly to surplus as changes in reserves on account of valuation  basis.  This resulted in an increase to the  unassigned
         deficit of approximately $40,511.

         Effective January 1, 2002, the Company adopted  Statement of Statutory  Accounting  Principles No. 82,  "Accounting for the
         Costs of Computer  Software  Developed or Obtained for Internal Use and Web Site  Development  Costs" ("SSAP 82").  SSAP 82
         requires the  capitalization  of certain costs incurred in connection with  developing or obtaining  internal use software.
         Prior to the adoption of SSAP 82, the Company  expensed all internal use software  related  costs as incurred.  The Company
         has  identified  and  capitalized  $5,935 of costs  associated  with  internal  use  software  as of January 1, 2002 and is
         amortizing the applicable  costs on a  straight-line  basis over a three year period.  The costs  capitalized as of January
         1, 2002 resulted in a direct increase to surplus.  Amortization expense for the year ended December 31, 2002 was $757.

12.      EMPLOYEE BENEFITS

         The Company has a 401(k) plan for which  substantially  all employees are eligible.  Under this plan, the Company  provides
         a 50% match on  employees'  contributions  up to 6% of an  employee's  salary  (for an  aggregate  match of up to 3% of the
         employee's  salary).  Additionally,  the Company may contribute  additional  amounts based on  profitability of the Company
         and  certain of its  affiliates.  Expenses  related to this  program in 2002,  2001 and 2000 were $719,  $2,738 and $3,734,
         respectively.  Company  contributions  to this plan on behalf of the  participants  were  $921,  $2,549 and $4,255 in 2002,
         2001 and 2000, respectively.

         The  Company  has a  deferred  compensation  plan,  which is  available  to the field  marketing  staff and  certain  other
         employees.  Expenses  related  to this  program  in 2002,  2001 and 2000 were  $3,522,  $1,615  and  $1,030,  respectively.
         Company  contributions  to this plan on behalf of the participants  were $5,271,  $1,678 and $2,134 in 2002, 2001 and 2000,
         respectively.

         The Company and certain  affiliates  cooperatively  have a  long-term  incentive  program  under which units are awarded to
         executive  officers and other  personnel.  The Company and certain  affiliates  also have a profit sharing  program,  which
         benefits all employees



                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                              (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                       Notes to Consolidated Financial Statements (continued)

12.      EMPLOYEE BENEFITS (continued)

         below the  officer  level.  These  programs  consist of  multiple  plans with new plans  instituted  each year.  Generally,
         participants  must remain  employed by the Company or its affiliates at the time such units are payable in order to receive
         any payments  under the programs.  The accrued  liability  representing  the value of these units was $7,083 and $13,645 as
         of December 31, 2002 and 2001,  respectively.  Expenses  (income)  related to these programs in 2002,  2001 and 2000,  were
         $1,471,  ($9,842) and $2,692,  respectively.  Payments under these programs were $8,033,  $8,377 and $13,697 in 2002,  2001
         and 2000, respectively.

13.      FINANCIAL REINSURANCE

         The Company cedes insurance to other insurers in order to fund the cash strain  generated from commission  costs on current
         sales  and to limit its risk  exposure.  The  Company  uses  modified  coinsurance  reinsurance  arrangements  whereby  the
         reinsurer shares in the experience of a specified book of business.  These reinsurance  transactions  result in the Company
         receiving  from the  reinsurer an upfront  ceding  commission  on the book of business  ceded in exchange for the reinsurer
         receiving  in the  future,  the future  fees  generated  from that book of  business.  Such  transfer  does not relieve the
         Company of its primary  liability and, as such,  failure of reinsurers to honor their  obligation could result in losses to
         the Company.  The Company reduces this risk by evaluating the financial condition and credit worthiness of reinsurers.

         The effect of reinsurance for the 2002, 2001 and 2000 was as follows:

        2002                                                            Gross          Ceded           Net
        ----                                                            -----          -----           ---
        Annuity and life insurance charges and fees                 $   406,272     $   (36,268)  $   370,004
        Return credited to contract owners                          $     5,221     $       (25)  $     5,196
        Underwriting, acquisition and other insurance
        expenses (deferal of acquisition costs)                     $   154,588     $    34,140   $   188,728
        Amortization of deferred acquisition costs                  $   542,945     $   (32,886)  $   510,059


        2001
        ----
        Annuity and life insurance charges and fees                 $   430,914     $   (42,218)  $   388,696
        Return credited to contract owners                          $     5,704     $        92   $     5,796
        Underwriting, acquisition and other insurance
        expenses (deferral of acquisition costs)                    $   163,677     $    33,078   $   196,755
        Amortization of deferred acquisition costs                  $   231,290     $    (7,243)  $   224,047


        2000
        ----
        Annuity and life insurance charges and fees                 $   473,318     $   (48,740)  $   424,578
        Return credited to contract owners                          $     8,540     $       (77)  $     8,463
        Underwriting, acquisition and other insurance
        expenses (deferral of acquisition costs)                    $   108,399     $    42,198   $   150,597
        Amortization of deferred acquisition costs                  $   205,174     $   (20,558)  $   184,616

         In December 2000, the Company entered into a modified  coinsurance  agreement with SICL covering  certain  contracts issued
         since January 1996.  The impact of this treaty to the



                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                              (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                       Notes to Consolidated Financial Statements (continued)

13.      FINANCIAL REINSURANCE (continued)

         Company was pre-tax (loss) income of ($4,137),  $8,394 and $23,341 in 2002,  2001 and 2000,  respectively.  At December 31,
         2002 and 2001, $675 and $1,137, respectively, was receivable from SICL under this agreement.

14.      SURPLUS NOTES

         The Company has issued  surplus notes to ASI in exchange for cash.  Surplus notes  outstanding  as of December 31, 2002 and
         2001, and interest expense for 2002, 2001 and 2000 were as follows:

                                                     Liability as of
                                                      December 31,                    Interest Expense
                                   Interest                                            For the Years
            Note Issue Date          Rate          2002          2001          2002         2001         2000
         ----------------------    ---------     ----------    ----------    ---------    ---------    ---------
         ----------------------    ---------     ----------

         February 18, 1994           7.28%               -             -             -            -          732
         March 28, 1994              7.90%               -             -             -            -          794
         September 30, 1994          9.13%               -             -             -        1,282        1,392
         December 19, 1995           7.52%               -        10,000           520          763          765
         December 20, 1995           7.49%               -        15,000           777        1,139        1,142
         December 22, 1995           7.47%               -         9,000           465          682          684
         June 28, 1996               8.41%          40,000        40,000         3,411        3,411        3,420
         December 30, 1996           8.03%          70,000        70,000         5,699        5,699        5,715
                                                 ----------    ----------    ---------    ---------    ---------
                                                 ----------    ----------    ---------    ---------    ---------

         Total                                    $110,000      $144,000       $10,872      $12,976      $14,644
                                                 ==========    ==========    =========    =========    =========

         On September 6, 2002,  surplus notes for $10,000,  dated December 19, 1995,  $15,000,  dated December 20, 1995, and $9,000,
         dated  December 22, 1995,  were repaid.  On December 3, 2001, a surplus note,  dated  September  30, 1994,  for $15,000 was
         repaid.  On December 27, 2000,  surplus  notes for $10,000,  dated  February 18, 1994,  and $10,000,  dated March 28, 1994,
         were repaid.  All surplus notes mature seven years from the issue date.

         Payment of interest and repayment of principal  for these notes is subject to certain  conditions  and require  approval by
         the  Insurance  Commissioner  of  the  State  of  Connecticut.  At  December  31,  2002  and  2001,  $29,230  and  $25,829,
         respectively, of accrued interest on surplus notes was not permitted for payment under these criteria.

15.      SHORT-TERM BORROWING

         The Company  had a $10,000  short-term  loan  payable to ASI at  December  31,  2002 and 2001 as part of a  revolving  loan
         agreement.  The loan had an interest  rate of 1.97% and  matured on January  13,  2003.  The loan was  subsequently  rolled
         over with a new interest  rate of 1.82% and a new maturity date of March 13, 2003.  The loan was further  extended to April
         30, 2003 and a new interest rate of 1.71%.  The total related  interest  expense to the Company was $271,  $522 and $687 in
         2002,  2001  and  2000,  respectively.  Accrued  interest  payable  was $10 and $113 as of  December  31,  2002  and  2001,
         respectively.





                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                              (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                       Notes to Consolidated Financial Statements (continued)

15.      SHORT-TERM BORROWING (continued)

         On January 3, 2002,  the Company  entered into a $150,000  credit  facility  with ASI. This credit  facility  terminates on
         December  31, 2005 and bears  interest at the offered  rate in the London  interbank  market  (LIBOR) plus 0.35 percent per
         annum for the  relevant  interest  period.  Interest  expense  related  to these  borrowings  was $2,243 for the year ended
         December 31, 2002.  As of December 31, 2002, no amount was outstanding under this credit facility.

16.      CONTRACT WITHDRAWAL PROVISIONS

         Approximately  99% of the  Company's  separate  account  liabilities  are subject to  discretionary  withdrawal by contract
         owners at market value or with market value  adjustment.  Separate  account  assets,  which are carried at fair value,  are
         adequate to pay such  withdrawals,  which are generally  subject to surrender  charges ranging from 10% to 1% for contracts
         held less than 10 years.

17.      RESTRUCTURING CHARGES

         On March 22, 2001 and  December 3, 2001,  the  Company  announced  separate  plans to reduce  expenses to better  align its
         operating  infrastructure  with  the  current  investment  market  environment.  As part of the two  plans,  the  Company's
         workforce was reduced by approximately  140 positions and 115 positions,  respectively,  affecting  substantially all areas
         of the Company.  Estimated  pre-tax  severance  benefits of $8,500 have been charged  against  2001  operations  related to
         these  reductions.  These  charges  have  been  reported  in the  Consolidated  Statements  of  Income  as a  component  of
         Underwriting,  Acquisition  and Other  Insurance  Expenses.  As of December 31, 2002 and 2001, the remaining  restructuring
         liability, relating primarily to the December 3, 2001 plan, was $12 and $4,104, respectively.

18.      COMMITMENTS AND CONTINGENT LIABILITIES

         In recent years, a number of annuity  companies have been named as defendants in class action lawsuits  relating to the use
         of variable  annuities as funding  vehicles for tax- qualified  retirement  accounts.  The Company is currently a defendant
         in one such lawsuit.  A purported  class action  complaint was filed in the United States  District  Court for the Southern
         District of New York on December  12,  2002,  by Diane C. Donovan  against the Company and certain of its  affiliates  (the
         "Donovan  Complaint").  The  Donovan  Complaint  seeks  unspecified  compensatory  damages and  injunctive  relief from the
         Company  and  certain of its  affiliates.  The Donovan  Complaint  claims  that the  Company and certain of its  affiliates
         violated  federal  securities laws in marketing  variable  annuities.  This litigation is in the  preliminary  stages.  The
         Company believes this action is without merit, and intends to vigorously defend against this action.

         The  Company is also  involved  in other  lawsuits  arising,  for the most part,  in the  ordinary  course of its  business
         operations.  While the outcome of these other  lawsuits  cannot be  determined  at this time,  after  consideration  of the
         defenses  available  to the  Company,  applicable  insurance  coverage and any related  reserves  established,  these other
         lawsuits are not expected to result in liability for amounts material to the financial  condition of the Company,  although
         it may adversely affect results of operations in future periods.



                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                              (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                       Notes to Consolidated Financial Statements (continued)

18.      COMMITMENTS AND CONTINGENT LIABILITIES (continued)

         As  discussed  previously,  on December  19,  2002,  SICL entered  into a  definitive  purchase  agreement  (the  "Purchase
         Agreement") to sell its ownership interest in the Company and certain affiliates to Prudential  Financial for approximately
         $1.265  billion.  The closing of this  transaction,  which is  conditioned  upon  certain  customary  regulatory  and other
         approvals and conditions, is expected in the second quarter of 2003.

         The purchase  price that was agreed to between SICL and  Prudential  Financial was based on a September 30, 2002  valuation
         of the Company and certain  affiliates.  As a result,  assuming the  transaction  closes,  the  economics of the  Company's
         business from  September 30, 2002 forward will inure to the benefit or detriment of Prudential  Financial.  Included in the
         Purchase Agreement,  SICL has agreed to indemnify  Prudential  Financial for certain liabilities that may arise relating to
         periods prior to September 30, 2002. These  liabilities  generally include market conduct  activities,  as well as contract
         and regulatory compliance (referred to as "Covered Liabilities").

         Related to the  indemnification  provisions  contained in the Purchase  Agreement,  SICL has signed, for the benefit of the
         Company,  an indemnity letter,  effective December 19, 2002, to make the Company whole for certain Covered Liabilities that
         come to  fruition  during  the period  beginning  December  19,  2002 and ending  with the close of the  transaction.  This
         indemnification  effectively  transfers  the risk  associated  with  those  Covered  Liabilities  from the  Company to SICL
         concurrent with the signing of the definitive purchase agreement rather than waiting until the transaction closes.

19.      SEGMENT REPORTING

         Assets under management and sales for products other than variable  annuities have not been  significant  enough to warrant
         full segment  disclosures as required by SFAS 131,  "Disclosures about Segments of an Enterprise and Related  Information,"
         and the Company does not  anticipate  that they will be so in the future due to changes in the Company's  strategy to focus
         on its core variable annuity business.

















                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                              (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                       Notes to Consolidated Financial Statements (continued)

20.      QUARTERLY FINANCIAL DATA (UNAUDITED)

         The following table summarizes information with respect to the operations of the Company on a quarterly basis:

                                                                      Three Months Ended
                                                  ----------------------------------------------------------
                          2002                      March 31       June 30       Sept. 30        Dec. 31
                                                    --------       -------       --------        -------
        Premiums and other insurance revenues*    $   118,797   $    126,614   $    115,931   $    108,488
        Net investment income                           4,965          4,714          5,128          4,825
        Net realized capital losses                    (1,840)        (1,584)        (2,327)        (3,863)
                                                  -----------   ------------   ------------   ------------
        Total revenues                                121,922        129,744        118,732        109,450
        Benefits and expenses*                        112,759        160,721        323,529        150,906
                                                  -----------   ------------   ------------   ------------
        Pre-tax net income (loss)                       9,163        (30,977)      (204,797)       (41,456)
        Income tax expense (benefit)                    1,703        (11,746)       (72,754)       (20,013)
                                                  -----------   ------------   ------------   ------------
        Net income (loss)                         $     7,460   $    (19,231)  $   (132,043)  $    (21,443)
                                                  ===========   ============   ============   ============

         *        For the quarters ended March 31, 2002 and June 30, 2002,  the Company had  overstated  premiums ceded in revenues.
                  The above  presentation  reflects  an equal and  offsetting  reclassification  of these  amounts to  benefits  and
                  expenses with no net income impact.

                                                                      Three Months Ended
                                                  ----------------------------------------------------------
                          2001                      March 31       June 30       Sept. 30        Dec. 31
                                                    --------       -------       --------        -------
        Premiums and other insurance revenues***  $   130,885   $    128,465   $    122,708   $    119,604
        Net investment income**                         5,381          4,997          5,006          4,742
        Net realized capital gains (losses)             1,902            373            376         (1,723)
                                                  -----------   ------------   ------------   ------------
        Total revenues                                138,168        133,835        128,090        122,623
        Benefits and expenses**  ***                  122,729        110,444        123,307        125,969
                                                  -----------   ------------   ------------   ------------
        Pre-tax net income (loss)                      15,439         23,391          4,783         (3,346)
        Income tax expense (benefit)                    4,034          7,451           (480)        (3,837)
                                                  -----------   ------------   -------------  ------------
        Net income                                $    11,405   $     15,940   $      5,263   $        491
                                                  ===========   ============   ============   ============

         **       For the quarters ended March 31, 2001,  June 30, 2001 and September 30, 2001, the Company had reported  investment
                  performance  associated  with its  derivatives  as net  investment  income.  The  above  presentation  reflects  a
                  reclassification of these amounts to benefits and expenses.
         ***      For the quarters  ended  September 30, 2001 and December 31, 2001,  the Company had  overstated  premiums ceded in
                  revenues.  The above presentation  reflects an equal and offsetting  reclassification of these amounts to benefits
                  and expenses with no net income impact.




                                            AMERICAN SKANDIA LIFE ASSURANCE CORPORATION
                              (an indirect wholly-owned subsidiary of Skandia Insurance Company Ltd.)

                                       Notes to Consolidated Financial Statements (continued)

20.      QUARTERLY FINANCIAL DATA (UNAUDITED) (continued)

                                                                      Three Months Ended
                                                  ----------------------------------------------------------
                          2000                      March 31       June 30       Sept. 30        Dec. 31
                                                    --------       -------       --------        -------
        Premiums and other insurance revenues     $    137,040  $    139,346   $   147,819    $    135,866
        Net investment income****                        4,343         4,625         4,619           5,008
        Net realized capital gains (losses)                729        (1,436)         (858)            877
        Total revenues                                 142,112       142,535       151,580         141,751
        Benefits and expenses****                      107,893       122,382       137,843         114,264
        Pre-tax net income                              34,219        20,153        13,737          27,487
        Income tax expense                              10,038         5,225         3,167          12,349
        Net income                                $     24,181  $     14,928   $    10,570    $     15,138
                                                  ============  ============   ===========    ============

         ****     For the quarters  ended March 31, 2000,  June 30, 2000,  September 30, 2000 and December 31, 2000, the Company had
                  reported investment  performance  associated with its derivatives as net investment income. The above presentation
                  reflects a reclassification of these amounts to benefits and expenses.









                               APPENDIX B - CONDENSED FINANCIAL INFORMATION ABOUT SEPARATE ACCOUNT B

Separate  Account B consists  of  multiple  Sub-accounts.  Each  Sub-account  invests  only in a single  mutual  fund or mutual fund
portfolio.  All or some of these  Sub-accounts  are available as investment  options for other variable  annuities we offer pursuant
to different prospectuses.

Unit Prices And Numbers Of Units:  The following table shows:  (a) the Unit Price,  as of the dates shown,  for Units in each of the
Sub-accounts of Separate Account B that are being offered pursuant to this Prospectus;  and (b) the number of Units  outstanding for
each such  Sub-account as of the dates shown.  Since November 18, 2002, we have been  determining,  on a daily basis,  multiple Unit
Prices for each  Sub-account  of Separate  Account B. We compute  multiple  Unit Prices  because  several of our variable  annuities
invest in the same  Sub-accounts,  and these annuities  deduct varying charges that correspond to each combination of the applicable
Insurance  Charge,  Distribution  Charge (when applicable) and the charges for each optional  benefit.  Where an asset-based  charge
corresponding  to a particular  Sub-account  within a new annuity  product is identical  to that in the same  Sub-account  within an
existing  annuity,  the Unit Price for the new annuity will be identical to that of the  existing  annuity.  In such cases,  we will
for reference  purposes depict,  in the condensed  financial  information for the new annuity,  Unit Prices of the existing annuity.
The year in which  operations  commenced in each such  Sub-account is noted in  parentheses.  To the extent a Sub-account  commenced
operations  during a particular  calendar  year,  the Unit Price as of the end of the period  reflects only the partial year results
from the  commencement  of operations  until  December 31st of the  applicable  year.  When a Unit Price was first  calculated for a
particular  Sub-account,  we set the  price of that  Unit at  $10.00  per  Unit.  Thereafter,  Unit  Prices  vary  based  on  market
performance.  Unit Prices and Units are provided for Sub-accounts that commenced operations prior to January 1, 2003.


                           Year Ended December 31,
- -------------------------------------------------- -------------
Sub-account                                            2002
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
Wells Fargo Variable Trust - Equity Income (1999)
     With No Optional Benefits
     Unit Price                                           $8.25
     Number of Units                                    196,720
     With One Optional Benefit
     Unit Price                                           $9.90
     Number of Units                                     10,707
     With Any Two Optional Benefits
     Unit Price                                           $9.90
     Number of Units                                         91
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST Strong International Equity 1 (1989)
     With No Optional Benefits
     Unit Price                                           $8.56
     Number of Units                                  2,569,506
     With One Optional Benefit
     Unit Price                                           $9.95
     Number of Units                                     90,759
     With Any Two Optional Benefits
     Unit Value                                           $9.95
     Number of Units                                      6,047
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST William Blair International Growth 2(1997)
     With No Optional Benefits
     Unit Price                                           $9.72
     Number of Units                                    835,523
     With One Optional Benefit
     Unit Price                                           $9.72
     Number of Units                                     78,368
     With Any Two Optional Benefits
     Unit Price                                           $9.71
     Number of Units                                      5,178
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------



                           Year Ended December 31,
- -------------------------------------------------- -------------
Sub-account                                            2002
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST American Century International Growth 3
(1997)
     With No Optional Benefits
     Unit Price                                           $8.52
     Number of Units                                  2,252,674
     With One Optional Benefit
     Unit Price                                           $9.69
     Number of Units                                    116,123
     With Any Two Optional Benefits
     Unit Price                                           $9.69
     Number of Units                                      1,896
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST DeAM International Equity 4 (1994)
     With No Optional Benefits
     Unit Price                                           $8.19
     Number of Units                                    269,995
     With One Optional Benefit
     Unit Price                                           $9.79
     Number of Units                                     22,770
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST MFS Global Equity (1999)
     With No Optional Benefits
     Unit Price                                           $9.04
     Number of Units                                    969,509
     With One Optional Benefit
     Unit Price                                           $9.87
     Number of Units                                     32,306
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST PBHG Small-Cap Growth 5 (1994)
     With No Optional Benefits
     Unit Price                                           $6.92
     Number of Units                                  1,970,250
     With One Optional Benefit
     Unit Price                                           $9.48
     Number of Units                                     47,261
     With Any Two Optional Benefits
     Unit Price                                           $9.47
     Number of Units                                      6,595
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST DeAM Small-Cap Growth 6 (1999)
     With No Optional Benefits
     Unit Price                                           $7.67
     Number of Units                                    639,695
     With One Optional Benefit
     Unit Price                                           $9.71
     Number of Units                                     12,122
     With Any Two Optional Benefits
     Unit Price                                           $9.71
     Number of Units                                      1,728
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------



                           Year Ended December 31,
- -------------------------------------------------- -------------
Sub-account                                            2002
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST Federated Aggressive Growth (2000)
     With No Optional Benefits
     Unit Price                                           $7.64
     Number of Units                                  1,255,415
     With One Optional Benefit
     Unit Price                                           $9.86
     Number of Units                                     63,097
     With Any Two Optional Benefits
     Unit Price                                           $9.86
     Number of Units                                      4,107
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST Gabelli Small-Cap Value 7 (1997)
     With No Optional Benefits
     Unit Price                                           $9.30
     Number of Units                                  6,141,523
     With One Optional Benefit
     Unit Price                                          $10.08
     Number of Units                                    209,790
     With Any Two Optional Benefits
     Unit Price                                          $10.08
     Number of Units                                     17,411
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST DeAM Small-Cap Value 8 (2002)
     With No Optional Benefits
     Unit Price                                           $7.66
     Number of Units                                    423,387
     With One Optional Benefit
     Unit Price                                          $10.08
     Number of Units                                     11,686
     With Any Two Optional Benefits
     Unit Price                                          $10.08
     Number of Units                                      5,211
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST Goldman Sachs Mid-Cap Growth 9 (2000)
     With No Optional Benefits
     Unit Price                                           $7.97
     Number of Units                                  1,273,118
     With One Optional Benefit
     Unit Price                                           $9.87
     Number of Units                                     66,279
     With Any Two Optional Benefits
     Unit Price                                           $9.87
     Number of Units                                      2,488
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST Neuberger Berman Mid-Cap Growth 10 (1994)
     With No Optional Benefits
     Unit Price                                           $7.41
     Number of Units                                  2,175,250
     With One Optional Benefit
     Unit Price                                           $9.51
     Number of Units                                     44,760
     With Any Two Optional Benefits
     Unit Price                                           $9.51
     Number of Units                                      1,311
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------



                           Year Ended December 31,
- -------------------------------------------------- -------------
Sub-account                                            2002
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST Neuberger Berman Mid-Cap Value 11 (1993)
     With No Optional Benefits
     Unit Price                                           $8.96
     Number of Units                                  5,118,558
     With One Optional Benefit
     Unit Price                                           $9.98
     Number of Units                                    163,415
     With Any Two Optional Benefits
     Unit Price                                           $9.97
     Number of Units                                     10,745
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST Alger All-Cap Growth (2000)
     With No Optional Benefits
     Unit Price                                           $6.80
     Number of Units                                    658,419
     With One Optional Benefit
     Unit Price                                           $9.36
     Number of Units                                      6,409
     With Any Two Optional Benefits
     Unit Price                                           $9.36
     Number of Units                                      3,466
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST Gabelli All-Cap Value (2000)
     With No Optional Benefits
     Unit Price                                           $8.17
     Number of Units                                  1,200,225
     With One Optional Benefit
     Unit Price                                          $10.04
     Number of Units                                     28,449
     With Any Two Optional Benefits
     Unit Price                                          $10.04
     Number of Units                                         88
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST T. Rowe Price Natural Resources (1995)
     With No Optional Benefits
     Unit Price                                           $9.59
     Number of Units                                    724,670
     With One Optional Benefit
     Unit Price                                          $10.44
     Number of Units                                      7,378
     With Any Two Optional Benefits
     Unit Price                                          $10.44
     Number of Units                                      5,472
     With All Optional Benefits
     Unit Price
     Number of Units
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST Alliance Growth 12 (1996)
     With No Optional Benefits
     Unit Price                                           $7.46
     Number of Units                                  1,869,353
     With One Optional Benefit
     Unit Price                                           $9.34
     Number of Units                                     31,105
     With Any Two Optional Benefits
     Unit Price                                           $9.34
     Number of Units                                      3,975
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------



                           Year Ended December 31,
- -------------------------------------------------- -------------
Sub-account                                            2002
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST MFS Growth (1999)
     With No Optional Benefits
     Unit Price                                           $7.58
     Number of Units                                  2,930,432
     With One Optional Benefit
     Unit Price                                           $9.47
     Number of Units                                    134,574
     With Any Two Optional Benefits
     Unit Price                                           $9.46
     Number of Units                                      2,437
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST Marsico Capital Growth (1997)
     With No Optional Benefits
     Unit Price                                           $8.32
     Number of Units                                 10,144,317
     With One Optional Benefit
     Unit Price                                           $9.51
     Number of Units                                    457,013
     With Any Two Optional Benefits
     Unit Price                                           $9.51
     Number of Units                                     30,465
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST Goldman Sachs Concentrated Growth 13 (1992)
     With No Optional Benefits
     Unit Price                                           $7.67
     Number of Units                                  1,349,939
     With One Optional Benefit
     Unit Price                                           $9.46
     Number of Units                                     41,632
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST DeAm Large-Cap Growth 8 (2002)
     With No Optional Benefits
     Unit Price                                           $7.65
     Number of Units                                    207,816
     With One Optional Benefit
     Unit Price                                           $9.64
     Number of Units                                      9,837
     With Any Two Optional Benefits
     Unit Price                                           $9.64
     Number of Units                                      3,697
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST DeAm Large-Cap Value 14 (2000)
     With No Optional Benefits
     Unit Price                                           $8.66
     Number of Units                                    664,649
     With One Optional Benefit
     Unit Price                                           $9.98
     Number of Units                                     18,250
     With Any Two Optional Benefits
     Unit Price                                           $9.97
     Number of Units                                      4,906
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------



                           Year Ended December 31,
- -------------------------------------------------- -------------
Sub-account                                            2002
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST Alliance/Bernstein Growth + Value (2001)
     With No Optional Benefits
     Unit Price                                           $7.99
     Number of Units                                    965,912
     With One Optional Benefit
     Unit Price                                           $9.79
     Number of Units                                     11,345
     With Any Two Optional Benefits
     Unit Price                                           $9.79
     Number of Units                                        704
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST AST Sanford Bernstein Core Value (2001)
     With No Optional Benefits
     Unit Price                                           $8.76
     Number of Units                                  6,005,922
     With One Optional Benefit
     Unit Price                                          $10.08
     Number of Units                                    386,259
     With Any Two Optional Benefits
     Unit Price                                          $10.08
     Number of Units                                     30,510
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST Cohen & Steers Realty (1998)
     With No Optional Benefits
     Unit Price                                          $10.08
     Number of Units                                  1,563,489
     With One Optional Benefit
     Unit Price                                          $10.33
     Number of Units                                     41,098
     With Any Two Optional Benefits
     Unit Price                                          $10.32
     Number of Units                                      6,429
     With All Optional Benefits
     Unit Price
     Number of Units
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST Sanford Bernstein Managed Index 500 15 (1998)
     With No Optional Benefits
     Unit Price                                           $8.17
     Number of Units                                  3,662,406
     With One Optional Benefit
     Unit Price                                           $9.81
     Number of Units                                     79,915
     With Any Two Optional Benefits
     Unit Price                                           $9.81
     Number of Units                                        383
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST American Century Income & Growth 16 (1997)
     With No Optional Benefits
     Unit Price                                           $8.25
     Number of Units                                  1,751,136
     With One Optional Benefit
     Unit Price                                           $9.89
     Number of Units                                     36,829
     With Any Two Optional Benefits
     Unit Price                                           $9.89
     Number of Units                                      8,874
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------



                           Year Ended December 31,
- -------------------------------------------------- -------------
Sub-account                                            2002
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST Alliance Growth and Income 17 (1992)
     With No Optional Benefits
     Unit Price                                           $8.06
     Number of Units                                  6,667,373
     With One Optional Benefit
     Unit Price                                           $9.83
     Number of Units                                    165,588
     With Any Two Optional Benefits
     Unit Price                                           $9.83
     Number of Units                                      6,100
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST MFS Growth with Income (1999)
     With No Optional Benefits
     Unit Price                                           $8.09
     Number of Units                                  1,053,007
     With One Optional Benefit
     Unit Price                                           $9.71
     Number of Units                                     17,242
     With Any Two Optional Benefits
     Unit Price                                           $9.71
     Number of Units                                        538
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST INVESCO Capital Income 18 (1994)
     With No Optional Benefits
     Unit Price                                           $8.34
     Number of Units                                  2,110,071
     With One Optional Benefit
     Unit Price                                           $9.90
     Number of Units                                     30,714
     With Any Two Optional Benefits
     Unit Price                                           $9.90
     Number of Units                                      5,934
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST DeAM Global Allocation 19 (1993)
     With No Optional Benefits
     Unit Price                                           $8.71
     Number of Units                                    847,517
     With One Optional Benefit
     Unit Price                                           $9.94
     Number of Units                                      3,088
     With Any Two Optional Benefits
     Unit Price                                           $9.93
     Number of Units                                         94
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST American Century Strategic Balanced (1997)
     With No Optional Benefits
     Unit Price                                           $9.14
     Number of Units                                  1,126,058
     With One Optional Benefit
     Unit Price                                           $9.97
     Number of Units                                     15,835
     With Any Two Optional Benefits
     Unit Price                                           $9.97
     Number of Units                                      2,760
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------



                           Year Ended December 31,
- -------------------------------------------------- -------------
Sub-account                                            2002
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST T. Rowe Price Asset Allocation (1994)
     With No Optional Benefits
     Unit Price                                           $9.09
     Number of Units                                    921,329
     With One Optional Benefit
     Unit Price                                           $9.96
     Number of Units                                     21,928
     With Any Two Optional Benefits
     Unit Price                                           $9.96
     Number of Units                                        150
     With All Optional Benefits
     Unit Price
     Number of Units
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST T. Rowe Price Global Bond 20 (1994)
     With No Optional Benefits
     Unit Price                                          $11.34
     Number of Units                                  1,739,313
     With One Optional Benefit
     Unit Price                                          $10.31
     Number of Units                                     36,822
     With Any Two Optional Benefits
     Unit Price                                          $10.31
     Number of Units                                      3,700
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST Federated High Yield (1994)
     With No Optional Benefits
     Unit Price                                           $9.71
     Number of Units                                  5,592,940
     With One Optional Benefit
     Unit Price                                          $10.26
     Number of Units                                     74,022
     With Any Two Optional Benefits
     Unit Price                                          $10.26
     Number of Units                                      6,524
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST Lord Abbett Bond-Debenture (2000)
     With No Optional Benefits
     Unit Price                                           $9.94
     Number of Units                                  4,146,530
     With One Optional Benefit
     Unit Price                                          $10.23
     Number of Units                                    162,571
     With Any Two Optional Benefits
     Unit Price                                          $10.23
     Number of Units                                      7,474
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST DeAM Bond 8 (2002)
     With No Optional Benefits
     Unit Price                                          $10.65
     Number of Units                                    561,446
     With One Optional Benefit
     Unit Price                                          $10.16
     Number of Units                                     12,055
     With Any Two Optional Benefits
     Unit Price                                          $10.15
     Number of Units                                        595
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------



                           Year Ended December 31,
- -------------------------------------------------- -------------
Sub-account                                            2002
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST PIMCO Total Return Bond (1994)
     With No Optional Benefits
     Unit Price                                          $10.57
     Number of Units                                 20,544,075
     With One Optional Benefit
     Unit Price                                          $10.17
     Number of Units                                    604,147
     With Any Two Optional Benefits
     Unit Price                                          $10.17
     Number of Units                                     36,236
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST PIMCO Limited Maturity Bond (1995)
     With No Optional Benefits
     Unit Price                                          $10.34
     Number of Units                                 11,274,642
     With One Optional Benefit
     Unit Price                                          $10.08
     Number of Units                                    215,314
     With Any Two Optional Benefits
     Unit Price                                          $10.08
     Number of Units                                     80,547
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
AST Money Market (1992)
     With No Optional Benefits
     Unit Price                                           $9.96
     Number of Units                                 36,255,772
     With One Optional Benefit
     Unit Price                                           $9.99
     Number of Units                                    999,737
     With Any Two Optional Benefits
     Unit Price                                           $9.99
     Number of Units                                     70,899
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
Gartmore Variable Investment Trust - GVIT
Developing Markets 9 (1996)
     With No Optional Benefits
     Unit Price                                           $8.66
     Number of Units                                    283,466
     With One Optional Benefit
     Unit Price                                           $9.93
     Number of Units                                     21,816
     With Any Two Optional Benefits
     Unit Price                                           $9.93
     Number of Units                                        442
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
INVESCO VIF - Dynamics (1999)
     With No Optional Benefits
     Unit Price                                           $7.09
     Number of Units                                    543,762
     With One Optional Benefit
     Unit Price                                           $9.70
     Number of Units                                     32,635
     With Any Two Optional Benefits
     Unit Price                                           $9.70
     Number of Units                                        576
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------



                           Year Ended December 31,
- -------------------------------------------------- -------------
Sub-account                                            2002
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
INVESCO VIF - Technology (1999)
     With No Optional Benefits
     Unit Price                                           $5.50
     Number of Units                                    293,307
     With One Optional Benefit
     Unit Price                                               -
     Number of Units                                          -
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
INVESCO VIF - Health Sciences (1999)
     With No Optional Benefits
     Unit Price                                           $8.00
     Number of Units                                    475,873
     With One Optional Benefit
     Unit Price                                           $9.51
     Number of Units                                      5,444
     With Any Two Optional Benefits
     Unit Price                                           $9.51
     Number of Units                                        140
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
INVESCO VIF - Financial Services (1999)
     With No Optional Benefits
     Unit Price                                           $8.76
     Number of Units                                    366,258
     With One Optional Benefit
     Unit Price                                           $9.92
     Number of Units                                      1,897
     With Any Two Optional Benefits
     Unit Price                                           $9.92
     Number of Units                                        141
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
INVESCO VIF - Telecommunications (1999)
     With No Optional Benefits
     Unit Price                                           $5.78
     Number of Units                                     94,004
     With One Optional Benefit
     Unit Price                                           $9.43
     Number of Units                                        770
     With Any Two Optional Benefits
     Unit Price                                           $9.42
     Number of Units                                        454
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
Evergreen VA - Global Leaders (1999)
     With No Optional Benefits
     Unit Price                                           $8.15
     Number of Units                                    113,389
     With One Optional Benefit
     Unit Price                                           $9.67
     Number of Units                                      3,669
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------



                           Year Ended December 31,
- -------------------------------------------------- -------------
Sub-account                                            2002
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
Evergreen VA - Special Equity (1999)
     With No Optional Benefits
     Unit Price                                           $7.44
     Number of Units                                    127,728
     With One Optional Benefit
     Unit Price                                           $9.85
     Number of Units                                     12,520
     With Any Two Optional Benefits
     Unit Price                                           $9.85
     Number of Units                                        533
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
Evergreen VA - Omega (2000)
     With No Optional Benefits
     Unit Price                                           $7.78
     Number of Units                                     39,943
     With One Optional Benefit
     Unit Price                                               -
     Number of Units                                          -
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - Europe 30 (1999)
     With No Optional Benefits
     Unit Price                                           $7.93
     Number of Units                                    292,396
     With One Optional Benefit
     Unit Price                                           $9.70
     Number of Units                                      2,625
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - Asia 30 8 (2002)
     With No Optional Benefits
     Unit Price                                           $7.75
     Number of Units                                    281,993
     With One Optional Benefit
     Unit Price                                           $9.86
     Number of Units                                      6,995
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - Japan 8 (2002)
     With No Optional Benefits
     Unit Price                                           $7.24
     Number of Units                                     65,845
     With One Optional Benefit
     Unit Price                                          $10.21
     Number of Units                                        351
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------



                           Year Ended December 31,
- -------------------------------------------------- -------------
Sub-account                                            2002
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - Banks 8 (2002)
     With No Optional Benefits
     Unit Price                                           $8.56
     Number of Units                                    101,136
     With One Optional Benefit
     Unit Price                                          $10.13
     Number of Units                                      3,422
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - Basic Materials 8 (2002)
     With No Optional Benefits
     Unit Price                                           $8.46
     Number of Units                                     76,331
     With One Optional Benefit
     Unit Price                                          $10.34
     Number of Units                                         12
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - Biotechnology (2001)
     With No Optional Benefits
     Unit Price                                           $7.09
     Number of Units                                    130,082
     With One Optional Benefit
     Unit Price                                               -
     Number of Units                                          -
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - Consumer Cyclical 8 (2002)
     With No Optional Benefits
     Unit Price                                           $7.25
     Number of Units                                    128,022
     With One Optional Benefit
     Unit Price                                           $9.37
     Number of Units                                      2,426
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - Consumer Non-Cyclical 8 (2002)
     With No Optional Benefits
     Unit Price                                           $8.28
     Number of Units                                    148,446
     With One Optional Benefit
     Unit Price                                           $9.90
     Number of Units                                      2,303
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------



                           Year Ended December 31,
- -------------------------------------------------- -------------
Sub-account                                            2002
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - Energy (2001)
     With No Optional Benefits
     Unit Price                                           $8.71
     Number of Units                                    299,833
     With One Optional Benefit
     Unit Price                                          $10.12
     Number of Units                                      1,660
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - Financial (2001)
     With No Optional Benefits
     Unit Price                                           $8.85
     Number of Units                                    221,377
     With One Optional Benefit
     Unit Price                                           $9.84
     Number of Units                                      2,066
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - Healthcare (2001)
     With No Optional Benefits
     Unit Price                                           $7.94
     Number of Units                                    388,508
     With One Optional Benefit
     Unit Price                                           $9.59
     Number of Units                                      6,831
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - Industrial 8 (2002)
     With No Optional Benefits
     Unit Price                                           $7.93
     Number of Units                                     12,642
     With One Optional Benefit
     Unit Price                                               -
     Number of Units                                          -
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - Internet 8 (2002)
     With No Optional Benefits
     Unit Price                                           $8.57
     Number of Units                                    306,572
     With One Optional Benefit
     Unit Price                                               -
     Number of Units                                          -
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------



                           Year Ended December 31,
- -------------------------------------------------- -------------
Sub-account                                            2002
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - Pharmaceuticals 8 (2002)
     With No Optional Benefits
     Unit Price                                           $8.56
     Number of Units                                    136,559
     With One Optional Benefit
     Unit Price                                           $9.63
     Number of Units                                      2,545
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - Precious Metals 8 (2002)
     With No Optional Benefits
     Unit Price                                           $9.70
     Number of Units                                  1,175,651
     With One Optional Benefit
     Unit Price                                          $11.30
     Number of Units                                     19,964
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - Real Estate (2001)
     With No Optional Benefits
     Unit Price                                           $9.86
     Number of Units                                    441,318
     With One Optional Benefit
     Unit Price                                          $10.20
     Number of Units                                     12,789
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP -Semiconductor 8 (2002)
     With No Optional Benefits
     Unit Price                                           $5.14
     Number of Units                                     93,241
     With One Optional Benefit
     Unit Price                                               -
     Number of Units                                          -
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - Technology (2001)
     With No Optional Benefits
     Unit Price                                           $6.03
     Number of Units                                    254,131
     With One Optional Benefit
     Unit Price                                               -
     Number of Units                                          -
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------



                           Year Ended December 31,
- -------------------------------------------------- -------------
Sub-account                                            2002
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - Telecommunications (2001)
     With No Optional Benefits
     Unit Price                                           $7.15
     Number of Units                                    272,408
     With One Optional Benefit
     Unit Price                                          $10.03
     Number of Units                                      3,642
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - Utilities (2001)
     With No Optional Benefits
     Unit Price                                           $7.83
     Number of Units                                    521,419
     With One Optional Benefit
     Unit Price                                          $10.61
     Number of Units                                      8,871
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - Bull 8 (2002)
     With No Optional Benefits
     Unit Price                                           $7.97
     Number of Units                                    954,792
     With One Optional Benefit
     Unit Price                                           $9.75
     Number of Units                                     10,297
     With Any Two Optional Benefits
     Unit Price                                           $9.75
     Number of Units                                        400
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - Bear (2001)
     With No Optional Benefits
     Unit Price                                          $11.38
     Number of Units                                  1,532,543
     With One Optional Benefit
     Unit Price                                          $10.13
     Number of Units                                     28,618
     With Any Two Optional Benefits
     Unit Price                                          $10.13
     Number of Units                                      1,514
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - UltraBull 22 (2001)
     With No Optional Benefits
     Unit Price                                           $6.78
     Number of Units                                    297,435
     With One Optional Benefit
     Unit Price                                           $9.61
     Number of Units                                        245
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------



                           Year Ended December 31,
- -------------------------------------------------- -------------
Sub-account                                            2002
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - OTC (2001)
     With No Optional Benefits
     Unit Price                                           $6.45
     Number of Units                                  1,346,852
     With One Optional Benefit
     Unit Price                                           $9.36
     Number of Units                                     13,113
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - Short OTC 8 (2002)
     With No Optional Benefits
     Unit Price                                          $11.00
     Number of Units                                    433,181
     With One Optional Benefit
     Unit Price                                          $10.43
     Number of Units                                     15,308
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - UltraOTC (1999)
     With No Optional Benefits
     Unit Price                                           $3.53
     Number of Units                                  1,003,123
     With One Optional Benefit
     Unit Price                                           $8.70
     Number of Units                                        233
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - Mid-Cap Value 8 (2002)
     With No Optional Benefits
     Unit Price                                           $7.66
     Number of Units                                    438,387
     With One Optional Benefit
     Unit Price                                          $10.06
     Number of Units                                      4,777
     With Any Two Optional Benefits
     Unit Price                                          $10.06
     Number of Units                                      4,799
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - Mid-Cap Growth 8 (2002)
     With No Optional Benefits
     Unit Price                                           $7.70
     Number of Units                                    439,054
     With One Optional Benefit
     Unit Price                                           $9.82
     Number of Units                                      1,587
     With Any Two Optional Benefits
     Unit Price                                           $9.81
     Number of Units                                      1,583
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------



                           Year Ended December 31,
- -------------------------------------------------- -------------
Sub-account                                            2002
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - UltraMid-Cap 8 (2002)
     With No Optional Benefits
     Unit Price                                           $5.71
     Number of Units                                    477,953
     With One Optional Benefit
     Unit Price                                           $9.86
     Number of Units                                      1,673
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - Small-Cap Value 8 (2002)
     With No Optional Benefits
     Unit Price                                           $7.09
     Number of Units                                    994,778
     With One Optional Benefit
     Unit Price                                          $10.15
     Number of Units                                     19,019
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - Small-Cap Growth 8 (2002)
     With No Optional Benefits
     Unit Price                                           $7.69
     Number of Units                                    772,260
     With One Optional Benefit
     Unit Price                                           $9.91
     Number of Units                                     10,572
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - UltraSmall-Cap 23 (1999)
     With No Optional Benefits
     Unit Price                                           $6.14
     Number of Units                                    212,085
     With One Optional Benefit
     Unit Price                                               -
     Number of Units                                          -
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - U.S. Government Plus 8 (2002)
     With No Optional Benefits
     Unit Price                                          $11.56
     Number of Units                                  2,486,854
     With One Optional Benefit
     Unit Price                                          $10.19
     Number of Units                                     22,148
     With Any Two Optional Benefits
     Unit Price                                          $10.19
     Number of Units                                        609
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------



                           Year Ended December 31,
- -------------------------------------------------- -------------
Sub-account                                            2002
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
ProFund VP - Rising Rates Opportunity 8 (2002)
     With No Optional Benefits
     Unit Price                                           $8.02
     Number of Units                                    165,792
     With One Optional Benefit
     Unit Price                                           $9.69
     Number of Units                                      9,028
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
First Trust(R)10 Uncommon Values (2000)
     With No Optional Benefits
     Unit Price                                           $6.80
     Number of Units                                     19,826
     With One Optional Benefit
     Unit Price                                               -
     Number of Units                                          -
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------
- -------------------------------------------------- -------------
Prudential - SP Jennison International Growth
(2001)
     With No Optional Benefits
     Unit Price                                           $8.01
     Number of Units                                     89,806
     With One Optional Benefit
     Unit Price                                           $9.59
     Number of Units                                      5,196
     With Any Two Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
     With All Optional Benefits
     Unit Price                                               -
     Number of Units                                          -
- -------------------------------------------------- -------------

1.       Effective December 10, 2001, Strong Capital  Management,  Inc. became  Sub-advisor of the Portfolio.  Prior to December 10,
     2001, A I M Capital  Management,  Inc.  served as  Sub-advisor  of the Portfolio,  then named "AST AIM  International  Equity."
     Between October 15, 1996 and May 3, 1999,  Putnam  Investment  Management,  Inc.  served as Sub-advisor of the Portfolio,  then
     named "AST Putnam  International  Equity."  Prior to October 15, 1996,  Seligman  Henderson  Co. served as  Sub-advisor  of the
     Portfolio, then named "Seligman Henderson International Equity Portfolio."
2.       Effective November 11, 2002,  William Blair & Company,  L.L.C.  became Sub-advisor of the Portfolio.  Prior to November 11,
     2002, Janus Capital Corporation served as Sub-advisor of the Portfolio, then named "AST Janus Overseas Growth."
3.       This  Portfolio  reflects the  addition of the net assets of the AST American  Century  International  Growth  Portfolio II
     ("Portfolio II") as a result of the merger between the Portfolio and Portfolio II.
4.       Effective  May 1, 2002,  Deutsche  Asset  Management,  Inc.  became  Sub-advisor  of the  Portfolio.  Prior to May 1, 2002,
     Founders Asset Management,  Inc. served as Sub-advisor of the Portfolio,  then named "AST Founders  Passport." Prior to October
     15, 1996,  Seligman Henderson Co. served as Sub-advisor of the Portfolio,  then named "Seligman  Henderson  International Small
     Cap Portfolio."
5.       Effective  September 17, 2001, Pilgrim Baxter & Associates,  Ltd. became  Sub-advisor of the Portfolio.  Prior to September
     17, 2001, Janus Capital  Corporation served as Sub-advisor of the Portfolio,  then named "AST Janus Small-Cap Growth." Prior to
     December 31, 1998,  Founders  Asset  Management,  LLC served as  Sub-advisor of the  Portfolio,  then named  "Founders  Capital
     Appreciation Portfolio."
6.       Effective December 10, 2001,  Deutsche Asset Management,  Inc. became  Sub-advisor of the Portfolio.  Prior to December 10,
     2001,  Zurich Scudder  Investments,  Inc.  served as Sub-advisor of the  Portfolio,  then named "AST Scudder  Small-Cap  Growth
     Portfolio".  Prior to May 1, 2001, the Portfolio was named "AST Kemper Small-Cap Growth Portfolio."
7.       Effective  October 23, 2000,  GAMCO  Investors,  Inc.  became  Sub-advisor of the Portfolio.  Prior to October 23, 2000, T.
     Rowe Price  Associates,  Inc.  served as  Sub-advisor  of the  Portfolio,  then named "AST T. Rowe Price  Small  Company  Value
     Portfolio."
8.       These portfolios were first offered as Sub-accounts on May 1, 2002.
9.       The condensed  financial  information of this Gartmore  Variable  Investment Trust portfolio  relates to prior periods when
     such  portfolio was a portfolio of Montgomery  Variable  Series.  Pursuant to a shareholder  vote,  effective June 20, 2003 the
     Montgomery Variable Series - Emerging Markets Portfolio  transferred its assets to the GVIT Developing Markets Portfolio of the
     Gartmore Variable Investment Trust.
10.      Effective  November 11, 2002,  Goldman Sachs Asset Management  became  Sub-advisor of the Portfolio.  Prior to November 11,
     2002, Janus Capital Corporation served as Sub-advisor of the Portfolio, then named "AST Janus Mid-Cap Growth."
11.      Effective May 1, 1998,  Neuberger  Berman  Management,  Inc.  became  Sub-advisor of the  Portfolio.  Prior to May 1, 1998,
     Berger Associates, Inc. served as Sub-advisor of the Portfolio, then named "Berger Capital Growth Portfolio."
12.      Effective May 1, 1998,  Neuberger  Berman  Management,  Inc.  became  Sub-advisor of the  Portfolio.  Prior to May 1, 1998,
     Federated Investment Counseling served as Sub-advisor of the Portfolio, then named "Federated Utility Income Portfolio."
13.      Effective May 1, 2000,  Alliance Capital  Management,  L.P. became Sub-advisor of the Portfolio.  Between December 31, 1998
     and May 1, 2000,  OppenheimerFunds,  Inc. served as Sub-advisor of the Portfolio,  then named "AST Oppenheimer Large-Cap Growth
     Portfolio." Prior to December 31, 1998,  Robertson,  Stephens & Company  Investment  Management,  L.P. served as Sub-advisor of
     the Portfolio, then named "Robertson Stephens Value + Growth Portfolio."
14.      Effective  November 11, 2002,  Goldman Sachs Asset Management  became  Sub-advisor of the Portfolio.  Prior to November 11,
     2002, Janus Capital Corporation served as Sub-advisor of the Portfolio, then named "AST JanCap Growth."
15.      Effective May 1, 2002,  Deutsche Asset Management,  Inc. became  Sub-advisor of the Portfolio.  Prior to May 1, 2002, Janus
     Capital Corporation served as Sub-advisor of the Portfolio, then named "AST Janus Strategic Value."
16.      Effective  May 1, 2000,  Sanford C.  Bernstein & Co.,  Inc.  became  Sub-advisor  of the  Portfolio.  Prior to May 1, 2000,
     Bankers Trust Company served as Sub-advisor of the Portfolio, then named "AST Bankers Trust Managed Index 500 Portfolio."
17.      Effective May 3, 1999, American Century Investment  Management,  Inc. became Sub-advisor of the Portfolio.  Between October
     15, 1996 and May 3, 1999, Putnam  Investment  Management,  Inc. served as Sub-advisor of the Portfolio,  then named "AST Putnam
     Value Growth & Income."
18.      Effective May 1, 2000,  Alliance  Capital  Management,  L.P.  became  Sub-advisor of the  Portfolio.  Prior to May 1, 2000,
     Lord, Abbett & Co. served as Sub-advisor of the Portfolio, then named "AST Lord Abbett Growth and Income Portfolio."
19.      Effective July 1, 2002, the AST INVESCO Equity Income portfolio changed its name to AST INVESCO Capital Income.
20.      Effective May 1, 2002,  Deutsche Asset Management,  Inc. became  Sub-advisor of the Portfolio.  Prior to May 1, 2002, A I M
     Capital  Management,  Inc. served as Sub-advisor of the Portfolio,  then named "AST AIM Balanced." Between October 15, 1996 and
     May 3, 1999,  Putnam  Investment  Management,  Inc. served as Sub-advisor of the Portfolio,  then named "AST Putnam  Balanced."
     Prior to October 15, 1996, Phoenix  Investment  Counsel,  Inc. served as Sub-advisor of the Portfolio,  then named "AST Phoenix
     Balanced Asset Portfolio."
21.      Effective August 8, 2000, T. Rowe Price  International,  Inc. became  Sub-advisor of the Portfolio.  Effective May 1, 2000,
     the name of the  Portfolio  was changed to the "AST T. Rowe Price  Global  Bond".  Effective  May 1, 1996,  Rowe  Price-Fleming
     International,  Inc.  became  Sub-advisor of the Portfolio.  Prior to May 1, 1996,  Scudder,  Stevens & Clark,  Inc.  served as
     Sub-advisor of the Portfolio, then named "AST Scudder International Bond Portfolio."
22.      Effective  May 1, 2003,  the ProFunds VP Bull Plus  portfolio  changed its name to ProFund VP UltraBull to reflect a change
     in its investment objective.
23.      Prior to May 1, 2000,  ProFund VP UltraSmall-Cap  was named "ProFund VP Small Cap" and sought daily investment results that
     corresponded to the performance of the Russell 2000(R)Index.





                                        APPENDIX C - CALCULATION OF OPTIONAL DEATH BENEFITS


Examples of Enhanced Beneficiary Protection Optional Death Benefit Calculation
The following are examples of how the Enhanced  Beneficiary  Protection  Optional Death Benefit is calculated.  Each example assumes
that a $50,000  initial  Purchase  Payment is made. Each example assumes that there is one Owner who is age 50 on the Issue Date and
that all Account  Value is maintained in the variable  investment  options.  The formula for  determining  the Enhanced  Beneficiary
Protection Optional Death Benefit is as follows:

           Growth =               Account Value of variable             minus         Purchase Payments - proportional
                               investment options plus Interim
                                Value of Fixed Allocations (no
                                         MVA applies)                                           withdrawals

NOTE: The examples below do not include Credits which may be recovered by American Skandia under certain circumstances.

Example with market increase
Assume that the Owner has made no withdrawals  and that the Account Value has been  increasing due to positive  market  performance.
On the date we receive  due proof of death,  the  Account  Value is  $75,000.  The basic  Death  Benefit is  calculated  as Purchase
Payments minus  proportional  withdrawals,  or Account Value,  less the amount of any Credits  applied within 12 months prior to the
date of  death,  which  ever is  greater.  Therefore,  the  basic  Death  Benefit  is equal to  $75,000.  The  Enhanced  Beneficiary
Protection  Optional Death Benefit is equal to the amount  payable under the basic Death Benefit  ($75,000) PLUS 40% of the "Growth"
under the Annuity.

         Growth   =        $75,000 - [$50,000 - $0]
                  =        $25,000

         Benefit Payable under Enhanced Beneficiary Protection Optional Death Benefit = 40% of Growth
                  =        $25,000 * 0.40
                  =        $10,000

         Benefit Payable under Basic Death Benefit PLUS Enhanced Beneficiary Protection Optional Death Benefit
                  =        $85,000

Examples with market decline
Assume  that the  Owner  has made no  withdrawals  and that  the  Account  Value  has been  decreasing  due to  declines  in  market
performance.  On the date we receive due proof of death,  the Account  Value is $45,000.  The basic Death  Benefit is  calculated as
Purchase Payments minus  proportional  withdrawals,  or Account Value, less the amount of any Credits applied within 12 months prior
to the date of death,  which ever is greater.  Therefore,  the basic Death  Benefit is equal to $50,000.  The  Enhanced  Beneficiary
Protection  Optional  Death Benefit is equal to the amount  payable under the basic Death Benefit  ($50,000) PLUS the "Growth" under
the Annuity.

         Growth   =        $45,000 - [$50,000 - $0]
                  =        $-5,000

         Benefit Payable under Enhanced Beneficiary Protection Optional Death Benefit = 40% of Growth
                  NO BENEFIT IS PAYABLE

         Benefit Payable under Basic Death Benefit PLUS Enhanced Beneficiary Protection Optional Death Benefit
                  =        $50,000

In this example you would receive no additional benefit from purchasing the Enhanced Beneficiary Protection Optional Death Benefit.




Example with market increase and withdrawals
Assume that the Account Value has been increasing due to positive  market  performance and the Owner made a withdrawal of $15,000 in
Annuity Year 5 when the Account  Value was $75,000.  On the date we receive due proof of death,  the Account  Value is $90,000.  The
basic Death Benefit is calculated as Purchase  Payments minus  proportional  withdrawals,  or Account Value,  less the amount of any
Credits  applied  within 12 months prior to the date of death,  which ever is greater.  Therefore,  the basic Death Benefit is equal
to $90,000.  The  Enhanced  Beneficiary  Protection  Optional  Death  Benefit is equal to the amount  payable  under the basic Death
Benefit ($90,000) PLUS 40% of the "Growth" under the Annuity.

         Growth   =        $90,000 - [$50,000 - ($50,000 * $15,000/$75,000)]
                  =        $90,000 - [$50,000 - $10,000]
                  =        $90,000 - $40,000
                  =        $50,000

         Benefit Payable under Enhanced Beneficiary Protection Optional Death Benefit = 40% of Growth
                  =        $50,000 * 0.40
                  =        $20,000

         Benefit Payable under Basic Death Benefit PLUS Enhanced Beneficiary Protection Optional Death Benefit
                  =        $110,000

Examples of Highest Anniversary Value Death Benefit Calculation
The  following  are examples of how the Highest  Anniversary  Value Death  Benefit is  calculated.  Each example  assumes an initial
Purchase  Payment of  $50,000.  Each  example  assumes  that there is one Owner who is age 70 on the Issue Date and that all Account
Value is maintained in the variable investment options.

NOTE: The examples below do not include Credits which may be recovered by American Skandia under certain circumstances.

Example with market increase and death before Death Benefit Target Date
Assume that the Owner's  Account Value has generally been  increasing  due to positive  market  performance  and that no withdrawals
have been made.  On the date we receive due proof of death,  the Account Value is $75,000;  however,  the  Anniversary  Value on the
5th  anniversary  of the Issue Date was $90,000.  Assume as well that the Owner has died before the Death Benefit  Target Date.  The
Death Benefit is equal to the greater of the Highest  Anniversary  Value or the basic Death Benefit.  The Death Benefit would be the
Highest  Anniversary  Value  ($90,000)  because it is greater  than the amount  that would have been  payable  under the basic Death
Benefit ($75,000).

Example with withdrawals
Assume that the Account Value has been increasing due to positive  market  performance and the Owner made a withdrawal of $15,000 in
Annuity  Year 7 when the  Account  Value was  $75,000.  On the date we receive  due proof of death,  the  Account  Value is $80,000;
however,  the  Anniversary  Value on the 5th  anniversary  of the  Issue  Date was  $90,000.  Assume as well that the Owner has died
before the Death  Benefit  Target  Date.  The Death  Benefit is equal to the greater of the Highest  Anniversary  Value or the basic
Death Benefit.

Highest Anniversary Value  = $90,000 - [$90,000 * $15,000/$75,000]
                                    = $90,000 - $18,000
                                    = $72,000

Basic Death Benefit                 = $80,000 - [$80,000 * $15,000/$75,000]
                                    = $80,000 - $16,000
                                    = $64,000

Example with death after Death Benefit Target Date
Assume that the Owner's Account Value has generally been  increasing due to positive market  performance and that no withdrawals had
been made prior to the Death  Benefit  Target Date.  Further  assume that the Owner dies after the Death Benefit  Target Date,  when
the Account Value is $75,000.  The Highest  Anniversary Value on the Death Benefit Target Date was $80,000;  however,  following the
Death  Benefit  Target  Date,  the Owner made a Purchase  Payment of $15,000 and had taken a  withdrawal  of $5,000 when the Account
Value was  $70,000.  The Death  Benefit is equal to the  greater of the  Highest  Anniversary  Value plus  Purchase  Payments  minus
proportional withdrawals after the Death Benefit Target Date or the basic Death Benefit.

Highest Anniversary Value  = $80,000 + $15,000 - [$80,000 * $5,000/$70,000]
                                    = $80,000 + $15,000 - $5,714
                                    = $100,714

Basic Death Benefit                 = $75,000









                                                               NOTES









- -------------------------------------------------------------------------------------------------------------------
                  PLEASE SEND ME A STATEMENT OF  ADDITIONAL  INFORMATION  THAT CONTAINS  FURTHER  DETAILS ABOUT THE
                  AMERICAN SKANDIA ANNUITY DESCRIBED IN PROSPECTUS WFVXT - SIX-PROS (12/2003).
- -------------------------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------------------------

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


                                       -------------------------------------------------------
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                                       -------------------------------------------------------
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                                       -------------------------------------------------------
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                                                               NOTES







Variable Annuity Issued by:                                                                  Variable Annuity Distributed by:

AMERICAN SKANDIA LIFE                                                                                      AMERICAN SKANDIA
ASSURANCE CORPORATION                                                                               MARKETING, INCORPORATED
One Corporate Drive                                                                                     One Corporate Drive
Shelton, Connecticut 06484                                                                       Shelton, Connecticut 06484
Telephone: 1-800-680-8920                                                                           Telephone: 203-926-1888
http://www.americanskandia.prudential.com                                         http://www.americanskandia.prudential.com



                                                         MAILING ADDRESSES:


                                               AMERICAN SKANDIA - VARIABLE ANNUITIES
                                                   Attention: Stagecoach Annuity
                                                           P.O. Box 7040
                                                     Bridgeport, CT 06601-7040



                                                           EXPRESS MAIL:
                                               AMERICAN SKANDIA - VARIABLE ANNUITIES
                                                   Attention: Stagecoach Annuity
                                                        One Corporate Drive
                                                         Shelton, CT 06484











                                                               NOTES