<PAGE>

                                                                     EXHIBIT 4.2

Kemper Investors Life Insurance Company
A Stock Life Insurance Company
Long Grove, Illinois 60049-0001

                                                                          [LOGO]
                                                                          ZURICH
                                                                          KEMPER


RIGHT TO CANCEL - FREE LOOK PROVISION - At any time within 10 days of receiving
this Contract You may return it to Us or to the agent through whom it was
purchased. All Purchase Payments allocated to the Guarantee Periods plus the
Fixed Account plus the Separate Account Contract Value computed at the end of
the valuation period following Our receipt of this Contract will then be
refunded within ten days, after deduction of any applicable Purchase Payment
bonus and the interest and investment experience related to any Purchase Payment
bonus.

We agree to pay an Annuity to the Annuitant provided the Annuitant is living and
this Contract is in force on the Annuity Date.

We further agree to pay the death benefit prior to the Annuity Date upon the
death of the Contract Owner or, in certain circumstances, the death of the
Annuitant. Payment will be made upon Our receipt of due proof of death and the
return of this Contract.

This Contract is issued in consideration of the attached application and payment
of the initial Purchase Payment.

The provisions on this cover and the pages that follow are part of this
Contract.

Signed for Kemper Investors Life Insurance Company at its home office, in Long
Grove, Illinois.

          /s/ Debra P. Rezabek               /s/ Gale K. Caruso
               Secretary                          President

INDIVIDUAL FLEXIBLE PREMIUM MODIFIED GUARANTEED, FIXED AND VARIABLE DEFERRED
ANNUITY CONTRACT

NON-PARTICIPATING

ALL PAYMENTS AND VALUES PROVIDED BY THIS CONTRACT WHEN BASED ON THE INVESTMENT
EXPERIENCE OF THE SUBACCOUNTS ARE VARIABLE AND ARE NOT GUARANTEED AS TO DOLLAR
AMOUNT. WITHDRAWALS AND TRANSFERS FROM THE GUARANTEED PERIOD VALUE BEFORE THE
END OF THE GUARANTEED PERIOD ARE SUBJECT TO A MARKET VALUE ADJUSTMENT.

This is a legal Contract between the Contract Owner and Kemper Investors Life
Insurance Company.

READ YOUR CONTRACT CAREFULLY.

Policy Form No. L-8698
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L-8698
                                     INDEX

                                                                   Page


ANNUITY OPTION TABLE                                    Follows Page 20

ANNUITY PERIOD PROVISIONS                                       16 - 20

        Election of Annuity Option                              16 - 20
        Annuity Options                                              17
        Transfers During the Annuity Period                     19 - 20

APPLICATION                                   Follows Contract Schedule

CONTRACT SCHEDULE                                         Follows Index

DEATH BENEFIT PROVISIONS                                        15 - 16

        Amount Payable Upon Death                                    15
        Payment Of Death Benefits                               15 - 16

DEFINITIONS                                                       5 - 7

ENDORSEMENTS, if any                       Follows Annuity Option Table

FIXED ACCOUNT PROVISIONS                                             10

        Fixed Account                                                10
        Fixed Account Contract Value                                 10

GENERAL PROVISIONS                                                7 - 8

        The Contract                                                  7
        Incontestability                                              7
        Assignment                                                    7
        Reports                                                       8
        Premium Taxes                                                 8

GUARANTEE PERIOD PROVISIONS                                     10 - 11

        Guarantee Period Value                                       10

OWNERSHIP PROVISIONS                                              8 - 9

        Owner of Contract                                             8
        Change of Ownership                                           8
        Beneficiary                                                   9

PURCHASE PAYMENT PROVISIONS                                           9

        Initial Purchase Payments                                     9
        Purchase Payment Limitations                                  9

TRANSFER AND WITHDRAWAL PROVISIONS                              13 - 15

        Transfers During The Accumulation Period                     13
        Withdrawals During The Accumulation Period                   14
        Transfer and Withdrawal Procedures                      14 - 15

VARIABLE ACCOUNT PROVISIONS                                     11 - 12

        Separate Account                                             11
        Liabilities Of Separate Account                              11
        Subaccounts                                                  11
        Rights Reserved By The Company                          11 - 12
        Accumulation Unit Value                                      12
<PAGE>

DEFINITIONS


                    Accumulation Period: The period between the Issue Date and
                    the Annuity Date.

                    Accumulation Unit: An accounting unit of measure used to
                    calculate the value of each Subaccount.

                    Age: The attained age of the Annuitant.

                    Annuitant: The person named in the application during whose
                    lifetime the Annuity is to be paid. When two people are
                    named as Joint Annuitants the term "Annuitant" means the
                    Joint Annuitants or the survivor. Under Qualified Plans,
                    only the spouse may be named as Joint Annuitant. You may not
                    change the person(s) named as the Annuitant.

                    Annuity: A series of payments paid in accordance with this
                    Contract which begins on the Annuity Date.

                    Annuity Date: The date on which this Contract matures and
                    Annuity payments begin. It must be at least one year from
                    the Issue Date and no later than the maximum age at
                    annuitization as stated on the Contract Schedule, unless
                    otherwise agreed. The Annuity Date can be changed, but not
                    beyond the maximum age.

                    Annuity Period: This is the period that starts on the
                    Annuity Date.

                    Annuity Unit: An accounting unit of measure used to
                    calculate the amount of Variable Annuity payments after the
                    first Annuity payment.

                    Contract: An individual Contract which we issue to You as
                    evidence of the rights and benefits under the Contract.

                    Contract Owner: See "You, Your, Yours" below.

                    Contract Value: The sum of the Fixed Account Contract Value
                    plus the Separate Account Contract Value plus the Guarantee
                    Period Value.

                    Contract Year: A one-year period starting on the Issue Date
                    and successive Contract anniversaries.

                    Fixed Account: Our assets other than those allocated to the
                    Separate Account or any other Separate Account under which
                    We guarantee a fixed rate of return.

                    Fixed Account Contract Value: The Fixed Account Contract
                    Value is the value of amounts allocated under this Contract
                    to the Fixed Account.

                    Fixed Annuity: An Annuity payment that does not vary with
                    investment performance.

                    Fund: An investment company or separate series thereof, in
                    which the Subaccounts of the Separate Account invest.

                    Guarantee Period: A period of time during which an amount is
                    to be credited with a guaranteed interest rate, subject to a
                    Market Value Adjustment prior to the end of the Guarantee
                    Period. The Guarantee Periods initially offered are stated
                    on the Contract Schedule.

L-8698                                                                    Page 5
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L-8698                                                                    Page 6

DEFINITIONS (Continued)

                    Guarantee Period Value: The (1) Purchase Payment allocated
                    or the amount transferred to a Guarantee Period; plus (2)
                    interest credited; minus (3) withdrawals and transfers
                    adjusted for (4) any applicable Market Value Adjustment
                    previously made. There is a $5,000 minimum on the sum of
                    Purchase Payments and amounts transferred to any Guarantee
                    Period Value.

                    Issue Date: The Issue Date is stated on the Contract
                    Schedule. It is the date Your initial Purchase Payment is
                    available for use and Your application has been accepted by
                    Us. It is also the date on which Your Purchase Payment
                    begins to be credited with interest and/or investment
                    experience.

                    Market Adjusted Value: A Guarantee Period Value adjusted by
                    the Market Value Adjustment formula prior to the end of a
                    Guarantee Period.

                    Market Value Adjustment: An adjustment of Guarantee Period
                    Values in accordance with the Market Value Adjustment
                    formula prior to the end of the Guarantee Period. The
                    adjustment reflects the change in the value of the Guarantee
                    Period Value due to changes in interest rates since the date
                    the Guarantee Period commenced. The Market Value Adjustment
                    formula is stated on the Contract Schedule.

                    Mortality and Expense Risk Charge: A charge deducted in the
                    calculation of the Accumulation Unit value and the Annuity
                    Unit value. It is for Our assumption of mortality risks and
                    expense guarantees. The charge is shown on the Contract
                    Schedule.

                    Nonqualified: A Contract issued to other than a Qualified
                    Plan.

                    Purchase Payments: The dollar amount We receive in U.S.
                    currency to buy the benefits this Contract provides.

                    Qualified Plan: A Contract issued under a retirement plan
                    which qualifies for favorable income tax treatment under
                    Section 401, 403, 408 or 457 of the Internal Revenue Code as
                    amended.

                    If this Contract is issued under a Qualified Plan additional
                    provisions may apply. The rider or amendment to this
                    Contract used to qualify it under the applicable section of
                    the Internal Revenue Code will indicate the extent of change
                    in the provisions.

                    Records Maintenance Charge: A charge assessed against Your
                    Contract as specified on the Contract Schedule. We reserve
                    the right to make this charge against the Fixed Account
                    Contract Value or the Guarantee Period Value.

                    Received: Received by Kemper Investors Life Insurance
                    Company at its home office.

                    Separate Account: A unit investment trust registered with
                    the Securities and Exchange Commission under the Investment
                    Act of 1940 known as the KILICO Variable Annuity Separate
                    Account.

                    Separate Account Contract Value: The sum of the Subaccount
                    Values of this Contract on the Valuation Date.

                    Subaccounts: The Separate Account has Subaccounts. The
                    Subaccounts initially available are stated on the Contract
                    Schedule.

                    Subaccount Value: The value of each Subaccount calculated
                    separately according to the formulas stated in this
                    Contract.
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DEFINITIONS (Continued)


                    Valuation Date: Each business day that applicable law
                    requires that We value the assets of the Separate Account.
                    Currently this is each day that the New York Stock Exchange
                    is open for trading.

                    Valuation Period: The period that starts at the close of a
                    Valuation Date and ends at the close of business the next
                    succeeding Valuation Date.

                    Variable Annuity: An Annuity payment which varies as to
                    dollar amount because of Subaccount investment experience.

                    We, Our, Us: Kemper Investors Life Insurance Company, Long
                    Grove, Illinois.

                    You, Your, Yours: The party(ies) named as Contract Owner in
                    the application unless later changed as provided in this
                    Contract. (See Change of Ownership.) The Contract Owner is
                    the Annuitant unless a different Contract Owner is named in
                    the application. Under a Nonqualified Annuity when more than
                    one person is named as Contract Owner, the terms "You",
                    "Your" means Joint Contract Owners. The Contract Owner may
                    be changed during the lifetime of the Contract Owner and the
                    Annuitant. The Contract Owner, prior to the Annuity Date or
                    any distribution of any death benefit, has the exclusive
                    right to exercise every option and right conferred by this
                    Contract.


GENERAL PROVISIONS

The Entire Contract The Contract, any application attached to the Contract, and
                    any endorsements constitute the entire contract between the
                    parties.

                    All statements made in the application are deemed
                    representations and not warranties. No statement will void
                    this Contract or be used as a defense of a claim unless it
                    is contained in the application.

Modification of     Only Our President, Secretary and Assistant Secretaries have
Contract            the power to approve a change or waive any provision of this
                    Contract. Any such modifications must be in writing. No
                    agent or person other than the officers named has the
                    authority to change or waive the provisions of this
                    Contract.

                    Upon notice to You or the payees during the Annuity Period,
                    this Contract may be modified by Us as is necessary to
                    comply with any law or regulation issued by a governmental
                    agency to which We or the Separate Account is subject or as
                    is necessary to assure continued qualification of this
                    Contract under the Internal Revenue Code or other laws
                    relating to retirement plans or Annuities or as otherwise
                    may be in Your best interest. In the event of a
                    modification, We may make appropriate endorsement to this
                    Contract and We will obtain all required regulatory
                    approvals.

Incontestability    This Contract is incontestable from the Issue Date.

Change of Annuity   You may write to Us prior to distribution of a death benefit
Date                or the first Annuity payment date and request a change of
                    the Annuity Date.

Assignment          No assignment under this Contract is binding unless We
                    receive it in writing. We assume no responsibility for the
                    validity or sufficiency of any assignment. Once filed, Your
                    rights, the Annuitant's rights and the beneficiary's rights
                    are subject to the assignment. Any claim is subject to proof
                    of interest of the assignee.

L-8698                                                                    Page 7
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L-8698                                                                    Page 8

GENERAL PROVISIONS (Continued)

Due Proof of Death      We must receive proof upon Your death or that of the
                        Annuitant before a death benefit is payable. The death
                        benefit will be paid within 2 months after the receipt
                        of such proof.

Reserves, Certificate   All reserves are equal to or greater than those required
Values and Death        by statute. Any available Contract Value and death
Benefits                benefit will not be less than the minimum benefit
                        required by the statutes of the state in which this
                        Contract is delivered.

Non-Participating       This Contract does not pay dividends. It will not share
                        in Our surplus earnings.

Reports                 At least once each Contract Year We will send You a
                        statement showing Purchase Payments received, interest
                        credited, investment experience, and charges made since
                        the last report, as well as any other information
                        required by statute.

Premium Taxes           We will make a deduction for state premium taxes in
                        certain situations. On any Contract subject to premium
                        tax, as provided under applicable law, the tax will be
                        deducted from: a. The Purchase Payments when We receive
                        them; b. the Contract Value upon total withdrawal; or c.
                        from the total Contract Value applied to an Annuity
                        option at the time Annuity payments start.

Determination           The method of determination by Us of the investment
Of Values               experience factor, the number and value of Accumulation
                        Units, and the number and value of Annuity Units shall
                        be conclusive upon You, any payee, and any beneficiary.

Creditors               The proceeds of this Contract and any payment under an
                        Annuity option will be exempt from the claim of
                        creditors and from legal process to the extent permitted
                        by law.

OWNERSHIP PROVISIONS

Owner of Contract      The Annuitant is You unless otherwise provided in the
                       application.

                       Before the Annuity Date or any distribution of death
                       benefit, You have the right to cancel or amend this
                       Contract if We agree. You may exercise every option and
                       right conferred by this Contract. The Joint Contract
                       Owners must agree to any change if more than one Contract
                       Owner is named.

Change of Ownership    You may change the Contract Owner by written request at
                       any time while You and the Annuitant are alive. You must
                       furnish information sufficient to clearly Identify the
                       new Contract Owner to Us. The change is subject to any
                       existing assignment of this Contract. When We record the
                       effective date of the change, it will be the date We
                       received the notice except for action taken by Us prior
                       to receiving the request. Any change is subject to the
                       payment of any proceeds. We may require You to return
                       this Contract to Us for endorsement of a change.
<PAGE>

OWNERSHIP PROVISIONS (Continued)

Beneficiary Designation and        The application for this Contract shows the
Change of Beneficiary              original beneficiary. You may change the
                                   beneficiary if You send Us a written notice
                                   in a form acceptable to Us. Changes are
                                   subject to the following conditions:

                                   1.  The change must be filed while the
                                       Annuitant is alive;

                                   2.  This Contract must be in force at the
                                       time You file a change;

                                   3.  Such change must not be prohibited by the
                                       terms of an existing assignment,
                                       beneficiary designation or other
                                       restriction;

                                   4.  Such change will take effect when We
                                       receive it;

                                   5.  After We receive the change, it will take
                                       effect on the date We received the change
                                       form. However, action taken by Us before
                                       the change form was received will remain
                                       in effect; and

                                   6.  The request for change must provide
                                       information sufficient to identify the
                                       new beneficiary.

                                   We may require You to return this Contract
                                   for endorsement of a change.

Death of Beneficiary               The interest of a beneficiary who dies before
                                   the distribution of the death benefit will
                                   pass to the other beneficiaries, if any,
                                   share and share alike, unless otherwise
                                   provided in the beneficiary designation. If
                                   no beneficiary survives or is named, the
                                   distribution will be made to Your estate when
                                   You die, or to the estate of the Annuitant
                                   upon the death of the Annuitant if You are
                                   not also the Annuitant. If a beneficiary dies
                                   within ten days of the date of Your death,
                                   the death benefit will be paid as if You had
                                   survived the beneficiary. If a beneficiary
                                   dies within ten days of the death of the
                                   Annuitant and You are not the Annuitant, We
                                   will pay the death benefit as if the
                                   Annuitant survived the beneficiary. If You,
                                   the Annuitant, and the beneficiary die
                                   simultaneously, We will pay the death benefit
                                   as if You had survived the Annuitant and the
                                   beneficiary.

PURCHASE PAYMENT PROVISIONS

Initial Purchase Payment           The minimum initial Purchase Payment is shown
                                   on the Contract Schedule.

Purchase Payment                   The minimum and maximum Purchase Payments
Limitations                        that may be made are shown on the Contract
                                   Schedule. We reserve the right to waive or
                                   modify these limits and to not accept any
                                   Purchase Payment.

                                   Subsequent Purchase Payments will be
                                   allocated according to Your most recent
                                   instructions at the time We receive Your
                                   Purchase Payment.

Place of Payment                   All Purchase Payments under this Contract
                                   must be paid to Us at Our home office or such
                                   other location as We may select. We will
                                   notify You and any other interest parties in
                                   writing of such other locations. Purchase
                                   Payments received by an agent will begin
                                   earning interest after We receive it.

Purchase Payment                   Subject to the limitations shown below,
Bonus                              Purchase Payments will be increased by the
                                   Purchase Payment bonus shown on the Contract
                                   Schedule before being allocated to the
                                   various accounts of this Contract.

                                   We reserve the right to not increase a
                                   Purchase Payment by the Purchase Payment
                                   bonus in the following situations.

                                      1. If at the time the Purchase Payment is
                                         made the sum of Purchase Payments,
                                         partial withdrawals and loans made
                                         under this Contract exceeds the sum of
                                         Purchase Payments and loan repayments,
                                         or
                                      2. The Purchase Payment arises from the
                                         transfer of money from any other Life
                                         Insurance or Annuity contract.

L-8698                                                                    Page 9
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L-8698                                                                   Page 10

FIXED ACCOUNT PROVISIONS

Fixed Account                 The Fixed Account Contract Value is increased by:
Contract Value                1. Your Purchase Payment allocated to the Fixed
                              Account; 2. amounts transferred from a Guarantee
                              Period or Subaccount to the Fixed Account at Your
                              request; and 3. the interest credited to amounts
                              so allocated or transferred. Transfers, charges,
                              and withdrawals from the Fixed Account reduce the
                              Fixed Account Contract Value.

                              Fixed Account interest rates are credited for
                              certain periods of time referred to as Fixed
                              Account interest rate periods. An initial Fixed
                              Account interest rate period runs from the date We
                              receive each Purchase Payment through the end of
                              the calendar month in which that Purchase Payment
                              is received and for 12 calendar months thereafter.
                              The initial Fixed Account interest rate for the
                              initial Purchase Payment is shown on the Contract
                              Schedule. We will declare an initial Fixed Account
                              interest rate for each subsequent Purchase Payment
                              when that Purchase Payment is received. For each
                              Purchase Payment, a subsequent Fixed Account
                              interest rate period begins immediately after the
                              Initial Fixed Account interest rate periods
                              ends and runs for 12 calendar months. Subsequent
                              Fixed Account interest rate periods are in effect
                              for periods of 12 calendar months immediately
                              following the end of each previous subsequent
                              Fixed Account Interest Rate Period. We will
                              declare an interest rate applicable to each
                              Purchase Payment for each subsequent Fixed Account
                              Interest Rate Period.

                              We reserve the right to declare the Fixed Account
                              current interest rate(s) based upon: the Issue
                              Date; the date We receive a Purchase Payment, or
                              the date of account transfer.

                              We calculate the interest credited to the Fixed
                              Account by compounding daily, at daily interest
                              rates, rates which would produce at the end of a
                              Contract Year a result identical to the one
                              produced by applying an annual interest rate.

                              The minimum guaranteed Fixed Account interest rate
                              is 3.00% per year.

GUARANTEE PERIOD PROVISIONS

Guarantee Period              We hold all amounts allocated to a Guarantee
                              Period in a non-unitized Separate Account. The
                              assets of this Separate Account equal to the
                              reserves and other liabilities of this Separate
                              Account will not be charged with liabilities
                              arising out of any other business We may conduct.
                              The initial Guarantee Periods available under this
                              Contract are shown on the Contract Schedule.

Guarantee Period Value        On any Valuation Date, the Guarantee Period Value
                              includes:
                              1.  Your Purchase Payments or transfers allocated
                                  to the Guarantee Period; plus
                              2.  interest credited; minus
                              3.  withdrawals and transfers; minus
                              4.  any applicable portion of the Records
                                  Maintenance Charge and charges for other
                                  benefits; adjusted for
                              5.  any applicable Market Value Adjustment
                                  previously made.

                              The Guarantee Period(s) initially elected and the
                              interest rate(s) initially credited are shown on
                              the Contract Schedule. The initial interest rate
                              credited to subsequent Purchase Payments will be
                              declared at the time the payment is received.

                              At the end of a Guarantee Period, the Guarantee
                              Period Value will be transferred to a money
                              market Subaccount unless You tell Us to do
                              otherwise.

Accumulated Guarantee         On any Valuation Date, the Accumulated Guarantee
Period Value                  Period Value is the sum of the Guarantee Period
                              Values. At any time during the Accumulation
                              Period, the Accumulated Guarantee Period Value may
                              be allocated to more than one Guarantee Period
                              with our agreement.

                              We calculate the interest credited to the
                              Guarantee Period Value by compounding daily, at
                              daily interest rates, rates which would produce at
                              the end of a Contract Year a result identical to
                              the one produced by applying an annual interest
                              rate.
<PAGE>

Market Value Adjustment       The Market Value Adjustment formula is stated on
                              the Contract Schedule. This formula is applicable
                              for both an upward or downward adjustment to a
                              Guarantee Period Value when, prior to the end of a
                              Guarantee Period, such value is:

                              1.   taken as a total or partial withdrawal;
                              2.   applied to purchase an Annuity; or
                              3.   transferred to another Guarantee Period, the
                                   Fixed Account or a Subaccount.

VARIABLE ACCOUNT PROVISIONS

Separate Account              The variable benefits under this Contract are
                              provided through the KILICO Variable Annuity
                              Separate Account. This is called the Separate
                              Account. The Separate Account is registered with
                              the Securities and Exchange Commission as a unit
                              investment trust under the Investment Company Act
                              of 1940. It is a separate investment account
                              maintained by Us into which a portion of the
                              company's assets have been allocated for this
                              Contract and may be allocated for certain other
                              Contracts.

Liabilities of Separate       The assets equal to the reserves and other
Account                       liabilities of the Separate Account will not be
                              charged with liabilities arising out of any other
                              business We may conduct. We will value the assets
                              of the Separate Account on each Valuation Date.

Separate Account              On any Valuation Date the Separate Account
Contract Value                Contract Value is the sum of its Subaccount
                              values.

Subaccounts                   The Separate Account consists of Subaccounts. The
                              initial Subaccounts available under this Contract
                              are shown on the Contract Schedule. We may, from
                              time to time, combine or remove Subaccounts in the
                              Separate Account and establish additional
                              Subaccounts of the Separate Account. In such event
                              We may permit You to select other Subaccounts
                              under this Contract. However, the right to select
                              any other Subaccount is limited by the terms and
                              conditions We may impose on such transactions.

Fund                          Each Subaccount of the Separate Account will buy
                              shares of a separate series of a Fund. Each Fund
                              is registered under the Investment Company Act of
                              1940 as an open-end management investment company.
                              Each series of a Fund represents a separate
                              investment portfolio which corresponds to one of
                              the Subaccounts of the Separate Account.

                              If We establish additional Subaccounts each new
                              Subaccount will invest in a new series of a Fund
                              or in shares of another investment company. We may
                              also substitute other investment companies.

Rights Reserved by the        We reserve the right, subject to compliance with
Company                       the current law or as it may be changed in the
                              future:

                              1. To operate the Separate Account in any form
                              permitted under the Investment Company Act of 1940
                              or in any other form permitted by law;

                              2. To take any action necessary to comply with or
                              obtain and continue any exemptions from the
                              Investment Company Act of 1940 or to comply with
                              any other applicable law;

                              3. To transfer any assets in any Subaccount to
                              another Subaccount or to one or more separate
                              accounts, or the General Account, or to add,
                              combine or remove Subaccounts in the Separate
                              Account;

L-8698                                                                   Page 11
<PAGE>


L-8698                                                                   Page 12

VARIABLE ACCOUNT PROVISIONS (Continued)

                              4.   To delete the shares of any of the portfolios
                              of a Fund or any other open-end investment company
                              and to substitute, for the Fund shares held in any
                              Subaccount, the shares of another portfolio of a
                              Fund or the shares of another investment company
                              or any other investment permitted by law; and

                              5.   To change the way We assess charges, but not
                              to increase the aggregate amount above that
                              currently charged to the Separate Account and the
                              Funds in connection with this Contract.

                              When required by law, We will obtain Your approval
                              of such changes and the approval of any regulatory
                              authority.

Accumulation Unit Value       Each Subaccount has an Accumulation Unit Value.
                              When Purchase Payments or other amounts are
                              allocated to a Subaccount, a number of units are
                              purchased based on the Accumulation Unit Value of
                              the Subaccount at the end of the Valuation Period
                              during which the allocation is made. When amounts
                              are transferred out of or deducted from a
                              Subaccount, units are redeemed in a similar
                              manner.

                              The value of a Subaccount on any Valuation Date is
                              the number of units held in the Subaccount times
                              the Accumulation Unit Value on that Valuation
                              Date.

                              The Accumulation Unit Value for each subsequent
                              Valuation Period is the investment experience
                              factor for that period multiplied by the
                              Accumulation Unit Value for the period immediately
                              preceding. Each Valuation Period has a single
                              Accumulation Unit Value that is applied to each
                              day in the period. The number of Accumulation
                              Units will not change as a result of investment
                              experience.

Investment Experience         Each Subaccount has its own investment experience
Factor                        factor. The investment experience of the Separate
                              Account is calculated by applying the investment
                              experience factor to the value in each Subaccount
                              during a Valuation Period.

                              The investment experience factor of a Subaccount
                              for a Valuation Period is determined by dividing
                              1. by 2. and subtracting 3. from the result,
                              where:

                              1.   is the net result of;

                              a.   the net asset value per share of the
                              investment held in the Subaccount determined at
                              the end of the current Valuation Period; plus

                              b.   the per share amount of any dividend or
                              capital gain distributions made by the investments
                              held in the Subaccount, if the "ex-dividend" date
                              occurs during the current Valuation Period; plus
                              or minus

                              c.   a charge or credit for taxes reserved for the
                              current Valuation Period which We determine
                              resulted from the investment operations of the
                              Subaccount.

                              2.   is the net asset value per share of the
                              investment held in the Subaccount, determined at
                              the end of the last Valuation Period.

                              3.   is the factor representing the sum of the
                              Separate Account charges stated on the Contract
                              Schedule for the number of days in the Valuation
                              Period.
<PAGE>

TRANSFER AND WITHDRAWAL PROVISIONS

Transfers During the               You may direct the following transfers;
Accumulation Period

                                   1.   All or part of the Separate Account
                                   Contract Value or a Guarantee Period Value
                                   may be transferred to the Fixed Account or to
                                   another Subaccount or Guarantee Period. We
                                   will allow the first transfer at the end of
                                   the free look period.

                                   2.   During the thirty days that follow a
                                   Contract Year Anniversary or the thirty day
                                   period that follows the date You receive an
                                   annual report, if later, all or part of the
                                   Fixed Account Contract Value, less debt, may
                                   be transferred to one or more Subaccounts or
                                   to one or more Guarantee Periods.

                                   Transfers will also be subject to the
                                   following conditions:

                                   1.   The minimum amount which may be
                                   transferred is $500 or if smaller, the
                                   remaining value in the Fixed Account,
                                   Subaccount or a Guarantee Period.

                                   2.   No partial transfer will be made if the
                                   remaining Contract Value of the Fixed Account
                                   or any Subaccount will be less than $500 or
                                   any Guarantee Period less than $5,000 unless
                                   the transfer will eliminate Your interest in
                                   such account;

                                   3.   No transfer may be made within seven
                                   calendar days of the date on which the first
                                   annuity payment is due;

                                   4.   You may request an additional transfer
                                   from the Fixed Account to one or more
                                   Subaccounts or to a Guarantee Period during
                                   the thirty day period before the date on
                                   which the first Annuity payment is due. Such
                                   transfer must become effective no later that
                                   the seventh calendar day before such due
                                   date;

                                   5.   When You request a transfer from the
                                   Fixed Account Contract Value to a Subaccount
                                   or to a Guarantee Period, We will limit the
                                   amount that can be transferred to the amount
                                   which exceeds 125% of any debt and withdrawal
                                   charge, if any, applicable to the total Fixed
                                   Account Contract Value.

                                   We will transfer amounts bought by Purchase
                                   Payments and all related accumulation
                                   received in a given Contract Year, in the
                                   chronological order We received them.

                                   We reserve the right to charge for transfers
                                   as described on the Contract Schedule.

                                   Any transfer request from the Certificate
                                   Owner or other authorized person must clearly
                                   specify: 1. the amount which is to be
                                   transferred; and 2. the names of the accounts
                                   which are affected. We will honor a telephone
                                   transfer request if a properly executed
                                   telephone transfer authorization is on file
                                   with Us. Such request for a transfer must
                                   comply with the conditions of the
                                   authorization.

                                   We reserve the right at any time and without
                                   notice to any party, to terminate, suspend,
                                   or modify these transfer rights.

L-8698                                                                   Page 13
<PAGE>

L-8698                                                                   Page 14

Withdrawals During the             During the Accumulation Period, You may
Accumulation Period                withdraw all or part of the Contract Value
                                   reduced by any applicable premium taxes and
                                   withdrawal charge and adjusted by any
                                   applicable Market Value Adjustment. The
                                   Market Value Adjustment formula will be
                                   applied to the applicable portion of the
                                   total value withdrawn. We must receive a
                                   written request that indicates the amount of
                                   the withdrawal from the Fixed Account and
                                   each Subaccount and Guarantee Period. You
                                   must return the Contract to Us if You elect a
                                   total withdrawal.

                                   Withdrawals are subject to these conditions:

                                   The Contract Value less any debt and any
                                   applicable withdrawal charges remaining after
                                   a withdrawal must be at least $5,000.

                                   Withdrawals from the Subaccounts will reduce
                                   the amounts in each Subaccount on a
                                   proportional basis, unless You tell Us
                                   otherwise.

                                   Each withdrawal from a Guarantee Period must
                                   be at least $5,000 or the value that remains
                                   in the Guarantee Period, if smaller;

                                   The maximum You may withdraw from any account
                                   is the value of the respective account less
                                   the amount of any withdrawal charge and
                                   Market Value Adjustment.

                                   Any withdrawal amount You request will be
                                   increased by any applicable withdrawal
                                   charge.

                                   A withdrawal from the Fixed Account is
                                   limited to an amount equal to the Fixed
                                   Account Contract Value.

                                   We reserve the right to restrict partial
                                   withdrawals from the Fixed Account in the
                                   first Contract Year.

                                   You will ratably forfeit any Purchase Payment
                                   bonus and related positive accumulation on
                                   any withdrawal in the first Certificate Year.

Withdrawal Charges                 All Purchase Payments in a given Contract
                                   Year and all related accumulations are
                                   totaled by account and each total is used
                                   separately in computing the withdrawal charge
                                   as stated in the Withdrawal Charge Table
                                   shown on the Contract Schedule.

                                   All amounts to be withdrawn and any
                                   applicable withdrawal charges will be charged
                                   first against Purchase Payments and all
                                   related accumulations in the chronological
                                   order we received such purchase payments by
                                   Contract Year.

                                   Any amount withdrawn which is not subject to
                                   a withdrawal charge will be considered a
                                   "partial free withdrawal."

                                   In the event of a partial withdrawal, a
                                   "partial free withdrawal" is applied against
                                   Purchase Payments and all related
                                   accumulations in the chronological order we
                                   received such Purchase Payments by Contract
                                   Year even though the Purchase Payments and
                                   related accumulations are no longer subject
                                   to a withdrawal charge.

Transfer and Withdrawal            We will withdraw or transfer from the Fixed
Procedures                         Account or Guarantee Periods as of the
                                   Valuation Date that follows the date We
                                   receive Your written or telephone transfer
                                   request. Amounts to be withdrawn or
                                   transferred from the Fixed Account or
                                   Guarantee Periods will be done on a first
                                   in - first out basis, unless You request
                                   otherwise. To process a withdrawal, the
                                   request must contain all required
                                   information.
<PAGE>

TRANSFER AND WITHDRAWAL PROVISIONS (Continued)

                              We will redeem the necessary number of
                              Accumulation Units to achieve the dollar amount
                              when the withdrawal or transfer is made from a
                              Subaccount. We will reduce the number of
                              Accumulation Units credited in each Subaccount by
                              the number of Accumulation Units redeemed. The
                              reduction in the number of Accumulation Units is
                              determined on the basis of the Accumulation Unit
                              Value at the end of the Valuation Period when We
                              receive the request, provided the request contains
                              all required information. We will pay the amount
                              within seven calendar days after the date We
                              receive the request, except as provided below.

Deferment of Withdrawal       If the withdrawal or transfer is to be made from a
Transfer                      Subaccount, We may suspend the right of withdrawal
                              or transfer or delay payment more than seven
                              calendar days: 1. during any period when the New
                              York Stock Exchange is closed other than customary
                              weekend and holiday closings; 2. when trading
                              markets normally utilized are restricted, or an
                              emergency exists as determined by the Securities
                              and Exchange Commission, so that disposal of
                              investments or determination of the Accumulation
                              Unit Value is not practical; or 3. for such other
                              periods as the Securities and Exchange Commission
                              by order may permit for protection of Certificate
                              Owners.

                              We may defer the payment of a withdrawal or
                              transfer from the Fixed Account or Guarantee
                              Periods, for the period permitted by law. This can
                              never be more than six months after You send Us a
                              written request. During the period of deferral, We
                              will continue to credit interest, at the then
                              current interest rate(s), to the Fixed Account
                              Contract Value and/or each Guarantee Period Value.

DEATH BENEFIT PROVISIONS

Amount Payable Upon Death     We compute the death benefit at the end of the
                              Valuation Period following Our receipt of due
                              proof of death and the return of this Contract.

                              If death occurs prior to attaining age 75, We will
                              pay the greater of: a. the Contract Value; or b.
                              the total amount of Purchase Payments, less the
                              aggregate dollar amount of all previous
                              withdrawals or c. the amount that would have been
                              payable in the event of a full surrender. We will
                              pay the larger of the Contract Value or the amount
                              that would have been payable in the event of a
                              full surrender if death occurs at age 75 or later.

Payment of Death Benefits     If You or the last surviving Annuitant dies while
                              the Contract is in effect and before the Annuity
                              Date, We will pay a death benefit. If a Contract
                              Owner is a non-natural person, the death of an
                              Annuitant will be considered as the death of a
                              Contract Owner for purposes of this death benefit
                              provision.

                              If an Annuitant dies after the Annuity Date, the
                              death benefit, if any, will depend on the Annuity
                              Option in effect. If You die after the Annuity
                              Date, income payments will be made at least as
                              rapidly as under the method of distribution being
                              used as of the date of such death.

                              We will pay the death benefit to the beneficiary
                              when We receive due proof of death. We will then
                              have no further obligation under this Contract.

                              When You die, We will pay the death benefit in a
                              lump sum. The entire interest in this Contract
                              must be distributed within five years from the
                              date of death unless it is applied under an
                              Annuity Option or the spouse continues this
                              Contract as described below.

L-8698                                                                   Page 15
<PAGE>

L-8698                                                                   Page 16

DEATH BENEFIT PROVISIONS (Continued)

                              Instead of a lump sum payment the beneficiary may
                              elect to have the death benefit distributed as
                              stated in Option 1 for a period not to exceed the
                              beneficiary's life expectancy; or Options 2, or 3
                              based upon the life expectancy of the beneficiary
                              as prescribed by federal regulations. The
                              beneficiary must make this choice within sixty
                              days of the time We receive due proof of death and
                              distribution must commence within one year of the
                              date of death.

                              If the beneficiary is not a natural person, the
                              beneficiary must elect that the entire death
                              benefit be distributed within five years of Your
                              death.

                              Distribution of the death benefit must start
                              within one year after Your death. It may start
                              later if prescribed by federal regulations.

                              If the primary beneficiary is the surviving spouse
                              when You die, the surviving spouse may elect to be
                              the successor Contract Owner of this Contract, in
                              lieu of receiving a death benefit. In such a case,
                              there will be no requirement to start a
                              distribution of death benefits.

ANNUITY PERIOD PROVISIONS

Election of Annuity Option    We must receive an election of Annuity option in
                              writing. You may make an election before the
                              Annuity Date providing the Annuitant is alive. The
                              Annuitant may make an election on the Annuity Date
                              unless You have restricted the right to make such
                              an election. The beneficiary may make an election
                              when We pay the death benefit.

                              An election will be revoked by 1. a subsequent
                              change of beneficiary; or 2. an assignment of this
                              Contact unless the assignment provides otherwise.

                              Subject to the terms of the death benefit
                              provision, the beneficiary may elect to have the
                              death benefit remain with Us under one of the
                              Annuity options.

                              If an Annuity option is not elected, an Annuity
                              will be paid under Option 3 for a Guaranteed
                              Period of ten years and for as long thereafter as
                              the payee is alive.

                              If the total Contract Value is applied under one
                              of the Annuity options, this Contract must be
                              surrendered to Us.

                              An option cannot be changed after the first
                              Annuity payment is made.

                              If, on the seventh calendar day before the first
                              Annuity payment due date, all the Contract Value
                              is allocated to the Fixed Account or Guarantee
                              Periods, the Annuity will be paid as a Fixed
                              Annuity. The Fixed Annuity is funded in Our
                              General Account, which consists of Our assets
                              other than those allocated to the Separate Account
                              or any other separate account. If all of the
                              Contract Value on such date is allocated to the
                              Separate Account, the Annuity will be paid as a
                              Variable Annuity. If the Contract Value on such
                              date is allocated to both the Fixed Account or a
                              Guarantee Period and a Subaccount, then the
                              Annuity will be paid as a combination of a Fixed
                              and a Variable Annuity. A Fixed and Variable
                              Annuity payment will reflect the investment
                              performance of the Subaccounts in accordance with
                              the allocation of the Contract Values existing on
                              such date. Allocations will not be changed
                              thereafter, except as provided in the Transfers
                              During the Annuity Period provision of this
                              Contract.
<PAGE>

 ANNUITY PERIOD PROVISIONS (Continued)


                              Payments for all options are derived from the
                              applicable tables. Current Annuity rates will be
                              used if they produce greater payments than those
                              quoted in this Contract. The age in the tables is
                              the age of the payee on the last birthday before
                              the first payment is due. We reserve the right to
                              deduct one year from the age for each 10 calendar
                              years that have elapsed since the year 2000.

                              The option selected must result in a payment that
                              is at least equal to Our minimum payment,
                              according to Our rules, at the time the Annuity
                              option is chosen. If at any time the payments are
                              less than the minimum payment, We have the right
                              to increase the period between payment to
                              quarterly, semi-annual or annual so that the
                              payment is at least equal to the minimum payment
                              or to make payment in one lump sum.

OPTION 1

Specified Period              We will make monthly payments for a fixed number
                              of installments. Payments must be made for at
                              least 5 years, but not more than 30 years.

OPTION 2

Life Annuity                  We will make monthly payments while the payee is
                              alive.

OPTION 3

Life Annuity with             We will make monthly payments for a Guaranteed
Installments Guaranteed       Period and thereafter while the payee is alive.
                              The Guaranteed Period must be selected at the time
                              the Annuity option is chosen. The Guaranteed
                              Periods available are 5, 10, 15 and 20 years.
OPTION 4

Joint and Survivor Annuity    We will pay the full monthly income while both
                              payees are alive. Upon the death of either payee,
                              We will continue to pay the surviving payee a
                              percentage of the original monthly payment. The
                              percentage payable to the surviving payee must be
                              selected at the time the Annuity option is chosen.
                              The percentages available are 50%, 66 2/3%, 75%
                              and 100%.

OTHER OPTIONS                 We may make other Annuity options available.
                              Payments are also available on a quarterly, semi-
                              annual or annual basis.

Fixed Annuity                 The Contract Value allocated to the Fixed Account
                              or the Guarantee Periods on the first day
                              preceding the date on which the first Annuity
                              payment is due is first reduced by any premium
                              taxes and charges that apply. The value that
                              remains will be used to determine the Fixed
                              Annuity monthly payment in accordance with the
                              Annuity option selected.

L-8698                                                                   Page 17
<PAGE>

L-8698                                                                   Page 16

Annuity PERIOD PROVISIONS (Continued)

Variable Annuity              The Separate Account Contract Value, at the end of
                              the Valuation Period preceding the Valuation
                              Period that includes the date on which the first
                              Annuity payment is due, is first reduced by any
                              Records Maintenance Charge, charges for other
                              benefits if any that may be added by a rider to
                              this Contract and any premium taxes that apply.
                              The value that remains is used to determine the
                              first monthly Annuity payment. The first monthly
                              Annuity payment is based upon the guaranteed
                              Annuity option shown in the Annuity Option Table.
                              You may elect any option available.

                              The dollar amount of subsequent payments may
                              increase or decrease depending on the investment
                              experience of each Subaccount. The number of
                              Annuity Units per payment will remain fixed for
                              each Subaccount unless a transfer is made. If a
                              transfer is made, the number of Annuity Units per
                              payment will change. Some Annuity options provide
                              for a reduction in the income level upon the death
                              of an Annuitant, which will reduce the number of
                              Annuity Units.

                              The number of Annuity Units for each Subaccount is
                              calculated by dividing a. by b. where:

                              a. is the amount of the monthly payment that can
                              be attributed to that Subaccount, and

                              b. is the Annuity Unit Value for that Subaccount
                              at the end of the Valuation Period. The Valuation
                              Period includes the date on which the payment is
                              made.

                              Monthly Annuity payments, after the first payment,
                              are calculated by summing up, for each Subaccount,
                              the product of a. times b. where:

                              a. is the number of Annuity Units per payment in
                              each Subaccount; and

                              b. is the Annuity Unit Value for that Subaccount
                              at the end of the Valuation Period. The Valuation
                              Period includes the date on which the payment is
                              made.

                              After the first payment, We guarantee that the
                              dollar amount of each Annuity payment will not be
                              affected adversely by actual expenses or changes
                              in mortality experience from the expense and
                              mortality assumptions on which We based the first
                              payment.

Annuity Unit Value            The value of an Annuity Unit for each Subaccount,
                              at the end of any subsequent Valuation Period is
                              determined by multiplying the result of a. times
                              b. by c. where:

                              a. is the Annuity Unit Value for the immediately
                              preceding Valuation Period; and

                              b. is the net investment factor for the Valuation
                              Period for which the Annuity Unit Value is being
                              calculated; and

                              c. is the interest factor of .99993235 per
                              calendar day of such subsequent Valuation Period
                              to offset the effect of the assumed rate of 2.50%
                              per year used in the Annuity Option Table. A
                              different interest factor will be used if an
                              assumed rate other than 2.50% is used in the
                              Annuity Option Table.
<PAGE>

ANNUITY PERIOD PROVISIONS (Continued)

                              The net investment factor for each Subaccount for
                              any Valuation Period is determined by dividing a.
                              by b. where:

                              a. is the value of an Annuity Unit of the
                              applicable Subaccount as of the end of the current
                              Valuation Period plus or minus the per share
                              charge or credit for taxes reserved.

                              b. is the value of an Annuity Unit of the
                              applicable Subaccount as of the end of the
                              immediately preceding Valuation Period, plus or
                              minus the per share charge or credit for taxes
                              reserved.

Transfers During the          During the Annuity Period, the payee(s) may not
Annuity Period                convert Fixed Annuity payments to Variable Annuity
                              payments. However, during the Annuity Period, the
                              payee(s), by sending Us a written notice in a form
                              satisfactory to Us, may convert Variable Annuity
                              payments to Fixed Annuity payments; or have
                              Variable Annuity payments reflect the investment
                              experience of other Subaccounts. A transfer may be
                              made subject to the following:

                              1. Transfers from a Subaccount to the General
                              Account can be effective only on an anniversary of
                              the first Annuity payment date. We must receive
                              notice of such transfer at least thirty days prior
                              to the effective date of the transfer. Unless You
                              specify otherwise, transfers to the General
                              Account from the Separate Account will be
                              proportional among the Subaccounts.

                              2. Transfers from one Subaccount to another
                              Subaccount will be effective during the Valuation
                              Period next succeeding the date the notice is
                              received by Us. However, if the notice for the
                              transfer is received within seven days immediately
                              preceding an Annuity payment date, the transfer
                              will be effective during the Valuation Period next
                              succeeding that Annuity payment date.

                              3. We reserve the right to limit the number of
                              transfers between Subaccounts to no less than one
                              each Contract Year.

                              4. We reserve the right to limit the number of
                              Subaccounts that may be used at one time to no
                              less than 3.

                              5. Requests for transfers must meet Our current
                              rules and be in a form acceptable to Us.

                              The number of Annuity Units per payment
                              attributable to a Subaccount to which transfer is
                              made is equal to, in the case of a transfer
                              between Subaccounts, the number of Annuity Units
                              per payment in the Subaccount from which transfer
                              is being made multiplied by the Annuity Unit Value
                              for that Subaccount divided by the Annuity Unit
                              Value for the Subaccount to which transfer is
                              being made.

L-8698                                                                   Page 19
<PAGE>

L-8698                                                                   Page 20

ANNUITY PERIOD PROVISIONS (Continued)

                              The amount of money allocated to the General
                              Account in the event of a transfer from a
                              Subaccount equals the Annuity reserve for the
                              payee's interest in such Subaccount. The Annuity
                              reserve is the product of a. multiplied by b.
                              multiplied by c. where: a. is the number of
                              Annuity Units representing the payee's interest in
                              such Subaccount per Annuity payment; b. is the
                              Annuity Unit Value for such Subaccount; and c. is
                              the present value of $1.00 per payment period
                              using the attained age(s) of the payee(s) and any
                              remaining guaranteed payment that may be due at
                              the time of the transfer. The fixed monthly
                              payments resulting from the transfer will not be
                              less than the amount purchased using the
                              guarantees under this Contract. Money allocated to
                              the General Account upon such transfer will be
                              applied under the same Annuity option as
                              originally elected. Any Guaranteed Period payments
                              will be adjusted to reflect the number of
                              guaranteed payments that have already been made.
                              If all guaranteed payments have already been
                              made, no further payments will be guaranteed.

                              All amounts and Annuity Unit Values are determined
                              as of the end of the Valuation Period which
                              precedes the effective date of the transfer.

                              We reserve the right at any time and without
                              notice to any party to terminate, suspend or
                              modify the transfer privileges.

Supplementary Agreement       A supplementary agreement will be issued to
                              reflect payments that will be made under a
                              settlement option. If payment is made as a death
                              benefit distribution, the effective date will be
                              the date of death. Otherwise the effective date
                              will be the date chosen by the Contract Owner.

Date of First Payment         Interest, under an option, will start to accrue on
                              the effective date of the supplementary agreement.
                              The supplementary agreement will provide details
                              on the payments to be made.

Evidence of Age, Sex          We may require satisfactory evidence of the age,
and Survival                  sex and the continued survival of any person on
                              whose life the income is based.

Misstatement of Age or Sex    If the age or sex of the payee has been misstated,
                              the amount payable under this Contract will be
                              such as the Purchase Payments sent to Us would
                              have purchased at the correct age or sex. Interest
                              not to exceed 6% compounded each year will be
                              charged to any overpayment or credited to any
                              underpayment against future payments We make under
                              this Contract.

Basis of Annuity Options      The guaranteed monthly payments are based on an
                              interest rate of 2.50% per year and where
                              mortality is involved, the A2000 Table developed
                              by the Society of Actuaries. We may also make
                              available Variable Annuity payment options based
                              on assumed investment rates other than 2.50% but
                              not greater than 5%.

Disbursement of Funds         When the payee dies, the value of any unpaid
Upon Death of Payee:          installments will be paid in one sum, to the
Under Options 1 or 3          estate of the payee unless otherwise provided in
                              the agreement. The commuted value for fixed
                              installments based upon a minimum interest rate of
                              not less than 2.50% will be paid. The commuted
                              value of any variable installments will be
                              determined by applying the Annuity Unit Value next
                              determined following Our receipt of due proof of
                              death and will be based on the Assumed Investment
                              Return.

Protection of Benefits        Unless otherwise provided in the supplementary
                              agreement the payee may not commute, anticipate,
                              assign, alienate or otherwise hinder the receipt
                              of any payment.
<PAGE>

                             ANNUITY OPTION TABLE

          AMOUNT OF MONTHLY PAYMENT FOR EACH $1,000 OF VALUE APPLIED

Option One - Specified Period

<TABLE>
<CAPTION>
 Number               Number                    Number                  Number
of years   Monthly   of years   Monthly        of years     Monthly    of years        Monthly
selected   Payment   selected   Payment        selected     Payment    selected        Payment
------------------------------------------------------------------------------------------------
<S>        <C>       <C>        <C>            <C>          <C>        <C>             <C>
    5       17.69       12         8.01              19        5.48       26              4.33
    6       14.92       13         7.48              20        5.27       27              4.22
    7       12.94       14         7.03              21        5.08       28              4.11
    8       11.46       15         6.64              22        4.90       29              4.02
    9       10.31       16         6.29              23        4.74       30              3.92
   10        9.39       17         5.99              24        4.59
   11        8.64       18         5.72              25        4.46
------------------------------------------------------------------------------------------------
</TABLE>

Options Two and Three - Life Annuity With Installments Guaranteed

<TABLE>
<CAPTION>
Age of      Monthly Payments Guaranteed           Age of         Monthly Payments Guaranteed
 Male                                             Female
Payee                                             Payee

        None     60     120     180     240                None     60     120     180     240

<S>     <C>     <C>     <C>     <C>     <C>       <C>      <C>     <C>     <C>     <C>     <C>
 55     4.17    4.16    4.13    4.06    3.96       55      3.87    3.86    3.84    3.81    3.75
 56     4.27    4.25    4.21    4.14    4.03       56      3.95    3.94    3.92    3.88    3.82
 57     4.36    4.35    4.30    4.22    4.09       57      4.03    4.02    4.00    3.95    3.88
 58     4.46    4.45    4.40    4.30    4.16       58      4.11    4.11    4.08    4.03    3.95
 59     4.57    4.55    4.50    4.39    4.22       59      4.21    4.20    4.17    4.11    4.01
 60     4.69    4.67    4.60    4.48    4.29       60      4.30    4.29    4.26    4.19    4.08
 61     4.81    4.79    4.71    4.57    4.36       61      4.41    4.40    4.35    4.28    4.15
 62     4.94    4.92    4.83    4.66    4.43       62      4.52    4.50    4.46    4.37    4.23
 63     5.09    5.05    4.95    4.76    4.49       63      4.64    4.62    4.56    4.46    4.30
 64     5.24    5.20    5.08    4.86    4.56       64      4.76    4.74    4.68    4.56    4.37
 65     5.40    5.35    5.21    4.96    4.62       65      4.90    4.87    4.80    4.66    4.45
 66     5.57    5.52    5.35    5.06    4.69       66      5.04    5.01    4.93    4.77    4.52
 67     5.75    5.69    5.49    5.17    4.75       67      5.19    5.16    5.06    4.87    4.59
 68     5.95    5.87    5.64    5.27    4.81       68      5.36    5.32    5.20    4.98    4.66
 69     6.15    6.07    5.80    5.37    4.86       69      5.53    5.49    5.35    5.10    4.73
 70     6.38    6.27    5.96    5.48    4.91       70      5.72    5.68    5.51    5.21    4.80
 71     6.61    6.49    6.12    5.58    4.96       71      5.93    5.87    5.67    5.33    4.86
 72     6.86    6.72    6.29    5.68    5.00       72      6.15    6.08    5.85    5.44    4.92
 73     7.13    6.96    6.47    5.77    5.04       73      6.39    6.31    6.03    5.56    4.97
 74     7.42    7.21    6.64    5.86    5.08       74      6.65    6.55    6.21    5.67    5.02
 75     7.72    7.48    6.82    5.95    5.11       75      6.93    6.81    6.41    5.78    5.06
 76     8.05    7.76    7.00    6.03    5.14       76      7.24    7.08    6.60    5.88    5.10
 77     8.40    8.06    7.18    6.11    5.17       77      7.57    7.38    6.80    5.98    5.13
 78     8.77    8.37    7.35    6.18    5.19       78      7.92    7.69    7.01    6.07    5.16
 79     9.18    8.69    7.53    6.25    5.20       79      8.31    8.02    7.21    6.15    5.18
 80     9.60    9.03    7.70    6.31    5.22       80      8.72    8.37    7.41    6.23    5.20
 81    10.06    9.38    7.86    6.36    5.23       81      9.17    8.74    7.61    6.30    5.22
 82    10.55    9.74    8.02    6.41    5.24       82      9.66    9.13    7.80    6.35    5.23
 83    11.07   10.12    8.17    6.45    5.25       83     10.20    9.54    7.98    6.41    5.24
 84    11.63   10.50    8.32    6.49    5.26       84     10.77    9.96    8.15    6.45    5.25
 85    12.22   10.89    8.45    6.52    5.26       85     11.39   10.40    8.31    6.49    5.26
------------------------------------------------------------------------------------------------
</TABLE>

Option Four - Joint and 100% Survivor Annuity

Age of                  Age of Female Payee
Male
Payee    55      60      65      70      75      80      85
 55     3.49    3.66    3.81    3.93    4.02    4.08    4.12
 60     3.61    3.83    4.05    4.24    4.40    4.52    4.59
 65     3.69    3.97    4.28    4.57    4.84    5.05    5.20
 70     3.76    4.09    4.47    4.89    5.31    5.67    5.95
 75     3.80    4.17    4.63    5.16    5.75    6.34    6.83
 80     3.83    4.23    4.73    5.37    6.14    6.99    7.80
 85     3.84    4.26    4.80    5.51    6.44    7.55    8.75

Rates for ages not shown here will be provided upon request.

L-8698                                                                   Page 21
<PAGE>

INDIVIDUAL FLEXIBLE PREMIUM MODIFIED GUARANTEED, FIXED AND VARIABLE DEFERRED
ANNUITY CONTRACT


NON-PARTICIPATING

ALL PAYMENTS AND VALUES PROVIDED BY THIS CONTRACT WHEN BASED ON THE INVESTMENT
EXPERIENCE OF THE SUBACCOUNTS ARE VARIABLE AND ARE NOT GUARANTEED AS TO DOLLAR
AMOUNT. WITHDRAWALS AND TRANSFERS FROM THE GUARANTEED PERIOD VALUE BEFORE THE
END OF THE GUARANTEED PERIOD ARE SUBJECT TO A MARKET VALUE ADJUSTMENT.

This is a legal Contract between the Owner and Kemper Investors Life Insurance
Company.

READ YOUR CONTRACT CAREFULLY

Kemper Investors Life Insurance Company
A Stock Life Insurance Company
1 Kemper Drive, Long Grove, Illinois 60049-0001


Policy Form No. L-8698