Registration No. 333-________

As filed with the Securities and Exchange Commission
on January 30, 1998

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM S-6

FOR REGISTRATION UNDER THE SECURITIES ACT OF 1933 OF
SECURITIES OF UNIT INVESTMENT TRUSTS REGISTERED ON FORM N-8B-2

LIFE INSURANCE SEPARATE ACCOUNT OF
USAA LIFE INSURANCE COMPANY
(Exact Name of Trust)

USAA LIFE INSURANCE COMPANY
(Name of Depositor)
9800 Fredricksburg Road, C-3-W
San Antonio, Texas 78288
(Complete Address of Depositor's Principal Executive Offices)

DWAIN A. AKINS, ESQ.
Assistant Vice President and Assistant Secretary
USAA Life Insurance Company
9800 Fredricksburg Road, C-3-W
San Antonio, Texas 78288
(Name and Complete Address of Agent for Service)

Please send copies of all communications to:

GARY O. COHEN, ESQ.
Freedman, Levy, Kroll & Simonds
1050 Connecticut Avenue, N.W., Suite 825
Washington, D.C. 20036
(202) 457-5107

Title and Amount of Securities Being Registered:
An Indefinite Amount of Interests in
Life Insurance Separate Account of
USAA Life Insurance Company
Under Variable Universal Life Insurance Policies

Approximate Date of Proposed Public Offering: As soon as practicable after the
effective date of this Registration Statement.

Registrant hereby amends this Registration Statement on such date or dates as
may be necessary to delay its effective date until the Registrant shall file a
further amendment which specifically states that this Registration Statement
shall thereafter become effective in accordance with Section 8(a) of the
Securities Act of 1933 or until this Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section
8(a), may determine.

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

Registrant elects to be governed by Rule 6e-3(T)(b)(13)(i)(B) under the
Investment Company Act of 1940, with respect to the Variable Universal Life
Insurance Policy described in the
Prospectus.

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

LIFE INSURANCE SEPARATE ACCOUNT OF
USAA LIFE INSURANCE COMPANY

ITEM NO. OF FORM N-8B-2 * CAPTION IN PROSPECTUS**

1 Cover Page

2 Cover Page

3 Not Applicable

4 Policy Distribution

5 Definitions

6 Separate Account

7 Not Required***

8 Not Required***

9 Legal Matters

10 Death Benefit; Other Policy Benefits;
Payment of Policy Benefits; Transfer of
Cash Value; Loans; Surrenders; Policy
Lapse and Reinstatement; Investment
Options - Voting Privileges; Investment
Options - Additions or Changes to
Investment Options; The Contract

11 Investment Options

12 Investment Options

13 The Policy at a Glance - Policy Charges
and Deductions; The Policy at a Glance -
Fund Fees and Other Expenses; Charges and
Deductions; USAA Life

14 Policy Issuance; Premium Payments

iii

15 Premium Payments; Investment Options

16 Premium Payments - Allocation of
Premiums; Investment Options

17 Death Benefit; Other Policy Benefits;
Payment of Policy Benefits; Transfer of
Cash Value; Loans; Surrenders; Policy
Lapse and Reinstatement

18 Tax Matters - Taxation of Policy
Proceeds: Our Taxes; Separate Account;
Charges and Deductions - Monthly
Deductions: Mortality and Expense Risk
Charge; Financial Statements

19 USAA Life; Reports and Records

20 Not Applicable

21 Loans

22 Not Applicable

23 Not Applicable**

24 Charges and Deductions; Cash Value;
Telephone Transactions; Free Look Right;
Postponement of Payments; More Policy
Information

25 USAA Life

26 Not Applicable

27 USAA Life

28 USAA Life - Directors of USAA Life; USAA
Life - Officers (other than Directors)

29 USAA Life

30 Not Applicable

31 Not Applicable

32 Not Applicable

33 Not Applicable

34 Not Applicable

35 Policy Distribution

36 Not Required***

37 Not Applicable

38 Policy Distribution

39 Policy Distribution

40 Not Applicable

41 Policy Distribution; Investment Options

42 Not Applicable

43 Not Applicable

44 Charges and Deductions - Other Charges;
Investment Options

45 Not Applicable

46 Charges and Deductions - Other Charges;
Investment Options

47 Not Applicable

48 Not Applicable

49 Not Applicable

50 Not Applicable

51 Not Applicable**

52 Investment Options - Additions or Changes
to Investment Options

53 Tax Matters - Taxation of USAA Life

54 Not Applicable

55 Not Applicable**

56 Not Required***

57 Not Required***

58 Not Required***

59 Not Required***

<FN>

* Registrant includes this Reconciliation and Tie Sheet in its
Registration Statement in compliance with Instruction 4 as to the
Prospectus as set out in Form S-6. Registrant, simultaneously herewith,
filed a Notification of Registration as an investment company on Form
N-8A and a Form N-8B-2 Registration Statement under the Investment
Company Act of 1940. Pursuant to Sections 8 and 30(b)(1) of the
Investment Company Act of 1940, Rule 30a-1 under that Act, and Forms
N-8B-2 and N-SAR under that Act, Registrant will keep its Form N-8B-2
Registration Statement current through the filing of periodic reports
required by the Securities and Exchange Commission.

** Caption in Prospectus, to the extent relevant to this Form. Certain
items are not relevant pursuant to the administrative practice of the
Commission and its staff of adapting the disclosure requirements of the
Commission's registration statement forms in recognition of the
differences between variable life insurance policies and other periodic
payment plan certificates issued by investment companies and between
separate accounts organized as management companies and unit investment
trusts.

*** Not required pursuant to Instruction 1(a) as to the Prospectus as set
out in Form S-6.
</FN>

VARIABLE UNIVERSAL LIFE INSURANCE POLICY

Offered By Prospectus dated:
May 1, 1998
USAA LIFE INSURANCE COMPANY
9800 Fredericksburg Road, San Antonio, Texas 78288
Telephone: toll free 1-800-531-8000 (in San
Antonio call 512-498-____)

This Prospectus describes a Variable Universal Life Insurance Policy
("Policy") that we are offering, through our Life Insurance Separate Account,
to individual members of the United Services Automobile Association ("USAA"),
the parent company of the USAA Group of Companies, as well as to the general
public.

The Policy offers you:

o Life insurance protection guaranteed by USAA Life. SEE "Policy
Benefits."

o 12 investment options, available through the Separate Account,
including Funds of USAA LIFE INVESTMENT TRUST, THE ALGER AMERICAN
FUND, SCUDDER VARIABLE LIFE INVESTMENT FUND, and BT INSURANCE
FUNDS TRUST. SEE "Investment Options" and the accompanying Fund
prospectuses for a description of the Funds.

o Flexible premium payments. SEE "Premium Payments."

Please read this Prospectus carefully and keep it for future reference.
Your Prospectus and Policy may reflect variations required by the laws of your
state. This Prospectus is not valid unless accompanied by the current
prospectuses for the Funds. Defined terms used in this Prospectus appear at
the end of this booklet.

THE SECURITIES AND EXCHANGE COMMISSION ("SEC") HAS NOT APPROVED OR
DISAPPROVED THE SECURITIES DESCRIBED IN THIS PROSPECTUS NOR HAS IT PASSED UPON
THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE. THE POLICIES ARE SOLELY THE OBLIGATIONS OF
USAA LIFE AND ARE NOT THE OBLIGATIONS OF, OR GUARANTEED BY, ANY ONE ELSE. THE
POLICY DOES NOT HAVE A MINIMUM GUARANTEED CASH VALUE, WHICH MEANS THAT YOU
BEAR THE ENTIRE INVESTMENT RISK THAT YOUR POLICY CASH VALUE COULD DECLINE TO
ZERO.

YOU MAY CANCEL THE POLICY WITHIN 10 DAYS AFTER RECEIVING IT, OR SUCH LONGER
PERIOD AS THE LAWS OF YOUR STATE MAY REQUIRE.

[FRONT COVER PAGE]

TABLE OF CONTENTS
Page
----

THE POLICY AT A GLANCE
QUESTIONS AND ANSWERS
POLICY INFORMATION

POLICY ISSUANCE
Who May Purchase a Policy
How to Purchase a Policy
Effective Date of Your Policy
PREMIUM PAYMENTS
Methods of Payment
Amount and Frequency of Payments
Allocation of Premiums
Planned Periodic Premium Payments
Annual Target Premium Payments
INVESTMENT OPTIONS
Additions or Changes to Investment Options
Voting Privileges
Special Considerations
POLICY LAPSE AND REINSTATEMENT
Lapse
Grace Period
Guaranteed Death Benefit
Reinstatement
CHARGES AND DEDUCTIONS
Premium Charge
Monthly Deductions
Separate Account Charges
Transfer Charges
Surrender Charges
Other Charges
Deduction of Charges
DEATH BENEFIT
Choosing Between Option A and Option B
Illustrations of Option A and Option B
Changing Your Death Benefit Option
Changing Your Policy's Specified Amount
OTHER POLICY BENEFITS
Optional Insurance Benefits
Benefits at Maturity
PAYMENT OF POLICY BENEFITS
Payment of Death Benefits
Payment of Maturity Benefits
Death Benefit Payment Options
CASH VALUE

Calculating Your Cash Value
in the Variable Fund Accounts
TRANSFER OF CASH VALUE
LOANS
Loan Collateral
Loan Interest
Repayment of Indebtedness
Effect of Policy Loans
SURRENDERS
Full Surrenders
Partial Surrenders
TELEPHONE TRANSACTIONS
FREE LOOK RIGHT
POSTPONEMENT OF PAYMENTS
MORE POLICY INFORMATION
OWNERS AND BENEFICIARIES
Owners
Beneficiaries
CALCULATING YOUR COST OF INSURANCE
Net Amount at Risk
Net Amount at Risk - More Than One Rate Class
Cost of Insurance Rates
MINIMUM AMOUNT INSURED
THE CONTRACT
INCONTESTABILITY
MISSTATEMENT OF AGE OR SEX
SUICIDE EXCLUSION
NON-PARTICIPATING POLICY
REPORTS AND RECORDS
PERFORMANCE INFORMATION
OTHER INFORMATION
USAA LIFE
Directors of USAA Life
Officers (other than Directors)
SEPARATE ACCOUNT
POLICY DISTRIBUTION
TAX MATTERS
Taxation of Policy Proceeds
Taxation of USAA Life
STATE REGULATION OF USAA LIFE
LEGAL MATTERS
EXPERTS
REGISTRATION STATEMENT
FINANCIAL STATEMENTS
DEFINITIONS

THE POLICY AT A GLANCE

The following is a snapshot of the Policy. Please refer to the remainder
of the Prospectus for further details and other information.

PREMIUM PAYMENTS AND WITHDRAWALS

MINIMUM AMOUNTS
Initial Premium Depends on Specified Amount of insurance
coverage
Subsequent Premiums Depends on Specified Amount of insurance
coverage
Withdrawals None

INSURANCE BENEFITS

DEATH BENEFITS

Option A Greater of Specified Amount or Minimum
Amount Insured

Option B Greater of Specified Amount plus cash
value or Minimum Amount Insured

Minimum Coverage Required $100,000 ($25,000 for Insureds under age
18)

Minimum Increase or Decrease $25,000, subject to $50,000 minimum
in Coverage coverage amount ($25,000 for Insureds
under age 18) with certain exceptions

OPTIONAL INSURANCE Accelerated Benefit for Terminal Illness
BENEFITS AVAILABLE Accidental Death Benefit
BY RIDER Children Term Life Insurance
Extended Maturity Date
Waiver of Monthly Deduction in Event of
Permanent Disability

BENEFITS AT MATURITY Current Policy cash value

POLICY CHARGES AND DEDUCTIONS

PREMIUM CHARGE 3% (waived if 10 Annual Target Premium
Payments paid)

MONTHLY DEDUCTIONS
Cost of Insurance Charge Depends on age, sex, and rate class of
Insured

Administrative Charge $10 (applies only during first Policy Year)
Maintenance Charge $5

TRANSFER CHARGE $0 for first six transfers each Policy
Year; $25 per transfer in excess of six
per Policy Year

SEPARATE ACCOUNT CHARGES
Mortality and Expense Charge 0.75% of net assets of Separate Account
Federal Income Tax Charge Currently none

SURRENDER CHARGES
Partial Surrender Lesser of $25 or 2% of amount withdrawn
Full Surrender Maximum of 50% of Annual Target Premium
Payment (declines each Policy year to 0%
after the 10th Policy Year)

FUND FEES AND OTHER EXPENSES

OTHER EXPENSES TOTAL FUND
MANAGEMENT AFTER OPERATING
FEES EXPENSE EXPENSES
REIMBURSEMENT

USAA LIFE
INVESTMENT TRUST

Money Market Fund
Income Fund
Growth and Income Fund
World Growth Fund
Diversified Assets Fund
Aggressive Growth Fund
International Fund

ALGER AMERICAN FUND
[TO BE
Growth Portfolio SUPPLIED BY
AMENDMENT]
SCUDDER VARIABLE LIFE
INVESTMENT FUND

Capital Growth Portfolio--
Class A Shares

BT INSURANCE FUNDS TRUST

Equity 500 Index Fund
Small Cap Index Fund
EAFE(R) Equity Index Fund

TRANSFERS

Number of free transfers 6 per Policy Year
Minimum amount of transfer $250 (or remaining cash value in Variable
c Fund Account, if less)

LOANS

Minimum Loan Amount None

Maximum Loan Amount 85% of cash surrender value

Maximum Interest Rate 6% payable in advance, 4.5% preferred rate
payable in advance

QUESTIONS AND ANSWERS

The following are answers to some basic questions about the Policy.
Please read the remainder of this Prospectus for further details.

WHAT KIND OF LIFE INSURANCE IS THE POLICY?

The Policy is a FLEXIBLE PREMIUM VARIABLE LIFE INSURANCE POLICY. The
Policy is called "flexible premium" because it gives you the flexibility to
vary the amount and frequency of your premium payments, within certain limits.

SEE "Premium Payments." The Policy is called "variable" life insurance because
your cash value, your cost of insurance charges, and your life insurance
(death) benefits can vary according to your investment in one or more Variable
Fund Accounts. SEE "Cash Value," "Charges and Deductions - Monthly
Deductions," and "Death Benefit." Your investment experience in the Variable
Fund Accounts may be positive or negative. THE POLICY HAS NO MINIMUM
GUARANTEED CASH VALUE, WHICH MEANS YOU BEAR THE ENTIRE INVESTMENT RISK THAT
YOUR CASH VALUE COULD DECLINE TO ZERO.

HOW DO I BUY A POLICY?

You can buy a Policy by calling us at 1-800-531-8000 or by contacting
one of our regional offices. Our licensed insurance representatives can help
you complete an application and assist you through our application or
"underwriting" process, which normally involves a medical exam. We will issue
a Policy to you, provided you meet our requirements for insurability. We will
not issue a Policy that insures a person older than age 80. We also reserve
the right to reject an application for any reason. Insurance coverage under
your Policy begins on its Effective Date. SEE "Policy Issuance."

HOW MUCH INSURANCE CAN I BUY?

The minimum amount of insurance you can buy is $100,000 ($25,000 if the
Insured is less than 18 years of age). We call the amount of insurance that
you specify on your application the "Specified Amount." Federal tax law limits
your ability to make certain amounts of large premium payments relative to
your Policy's Specified Amount and may impose penalties on amounts you take
out of your Policy if you do not observe certain additional requirements. SEE
"Premium Payments - Amount and Frequency of Payments" and "Tax Matters." We
will monitor your premium payments to be sure that you do not exceed permitted
amounts or inadvertently incur any tax penalties due to excess premium
payments. You can change the Specified Amount, at any time, subject to the
conditions described under "Death Benefit Changing Your Policy's Specified
Amount."

WHAT INSURANCE PROTECTION DOES THE POLICY OFFER?

The Policy offers two types of insurance protection or "death benefit"
options. If you select the Option A death benefit, upon the Insured's death,
we will pay your beneficiary the greater of your Policy's Specified Amount or
the Minimum Amount Insured. If you select the Option B death benefit, upon the
Insured's death, we will pay your beneficiary the greater of your Policy's
Specified Amount and your cash value, on the one hand, or the Minimum Amount
Insured on the other. SEE "Death Benefit." As long as the Policy remains in
effect, under either option, the death benefit will never be less than the
Policy's Specified Amount, less any Indebtedness and any due and unpaid
Monthly Deductions.

In addition, you can add optional insurance death benefits to a Policy
by rider. SEE "Optional Insurance Benefits."

HOW MUCH ARE THE PREMIUM PAYMENTS?

Within certain limits, you have the flexibility to determine the amount
and timing of your premium payments to reflect your changing financial
conditions or objectives. We generally require a minimum initial premium to
issue a Policy, but we do not impose a minimum on your subsequent premium
payments. SEE "Premium Payments." You must, of course, maintain sufficient
cash value to keep your Policy in effect, which may require you to make
additional unscheduled premium payments. SEE "Policy Lapse and Reinstatement."

You will usually plan a periodic premium schedule when applying for a
Policy. If you wish, we will bill you for these amounts. However, you are not
required to follow this schedule. SEE "Premium Payments."

WHAT ARE THE CHARGES AND DEDUCTIONS?

We assess certain charges and deductions to support the operation of
your Policy and the Separate Account. Some charges apply to your premium
payments, some apply to your cash value, and others apply to the Separate
Account. In addition, we assess administrative fees for processing Policy
transactions, such as partial surrenders of cash value and transfers of cash
value among Variable Fund Accounts in excess of six free transfers. SEE "The
Policy At a Glance" and "Charges and Deductions."

WHAT FACTORS AFFECT MY COST OF INSURANCE?

If you are the Insured, your cost of insurance will depend on your age,
sex, and rate class. The rate class that applies depends on your health,
whether you use tobacco, and other factors that we use to determine your
insurability. During the life of the Policy, the maximum monthly cost of
insurance charges will never exceed the guaranteed monthly cost of insurance
rates specified in your Policy. SEE "Calculating Your Cost of Insurance."

WHAT IS THE SEPARATE ACCOUNT?

The Separate Account is a segregated asset account of USAA Life that
supports the Policy's variable life insurance benefits. The Separate Account
consists of 12 Variable Fund Accounts, each of which invests in a
corresponding Fund. SEE "Investment Options."

WHAT ARE MY INVESTMENT CHOICES?

You may invest in up to 12 Variable Fund Accounts, each of which invests
exclusively in a corresponding Fund of the USAA Life Investment Trust, The
Alger American Fund, Scudder Variable Life Investment Fund, or BT Insurance
Funds Trust. SEE "Investment Options."

HOW WILL MY POLICY'S CASH VALUE VARY?

Your Policy's cash value will vary on a daily basis to reflect the
investment experience of the Variable Fund Accounts. Your Policy's cash value
also will reflect the amount and frequency of premium payments, any partial
surrenders of cash value, any Policy loans and the charges and deductions
connected with the Policy. There is no minimum guaranteed cash value, which
means you bear the entire investment risk that your cash value could decline
to zero. SEE "Cash Value."

HOW MAY I ALLOCATE MY CASH VALUE?

You may allocate your cash value to any of the Variable Funds Accounts
by specifying on your Policy application how much of your Net Premium Payment
you would like us to apply to each Account. We will allocate your Net Premium
Payments in accordance with your allocation instructions on your application,
until you direct otherwise. You may change future allocations at any time by
telephone or by Notice to Us. You may allocate your Net Premium Payment in
increments as small as1/10 of one percent. SEE "Premium Payments."

CAN I TRANSFER CASH VALUE AMONG INVESTMENT OPTIONS?

Yes. You can transfer cash value among the Variable Fund Accounts up to
six (6) times per Policy Year without charge. Each transfer above six (6) in a
Policy Year is subject to a $25 transfer charge. You may authorize transfers
by telephone or by Notice to Us. SEE "Telephone Transactions." Each transfer
must be at least $250, or the remaining cash value in the Variable Fund
Account, if less. SEE "Transfers."

HOW DO I ACCESS MY CASH VALUE?

You can partially or fully surrender the Policy for a portion or all of
its cash value, less any applicable charges, any Indebtedness, and any due and
unpaid Monthly Deductions. We assess an administrative charge equal to the
lesser of $25 or 2% of the amount withdrawn for each partial surrender paid.
We also assess a surrender charge for full surrenders. SEE "Surrenders" and
"Charges and Deductions - Surrender Charges." Partial surrenders and related
surrender charges will reduce your Policy's death benefit on a dollar for
dollar basis. SEE "Changing Your Policy's Specified Amount" under "Death
Benefits." Full surrenders will terminate the Policy. SEE "Tax Matters" for a
discussion of the tax consequences of surrenders.

CAN I BORROW AGAINST THE POLICY'S CASH VALUE?

Yes. You can borrow money from us by using your Policy as the sole
security for the loan. The most you can borrow against your Policy is 85% of
its cash surrender value. In some cases, we may reduce the amount you can
borrow. Interest on any loan is payable in advance at the maximum annual
interest rate of 6% (4.5% for preferred loans.). Lower rates may be available.

A loan, whether repaid or not, will have a permanent effect on the death
benefit and cash value of your Policy. SEE "Loans."

WHAT WILL CAUSE THE POLICY TO LAPSE WITHOUT VALUE?

Lapse will only occur when your cash value is insufficient to pay the
Monthly Deduction plus any loan interest then due and we do not receive
sufficient payment during the grace period. SEE "Lapse and Reinstatement."

WILL THE POLICY'S DEATH BENEFIT AND CASH VALUE BE TAXED?

The Policy meets the definition of a "life insurance contract" under
federal tax law. Therefore, the Policy's death benefit should be fully
excludable from the beneficiary's gross income if paid by reason of the death
of the Insured. In addition, any earnings on your investment in a Variable
Fund Account should not be taxable to you while the Policy is in effect unless
you surrender some or all of your Policy's cash value. We do not intend this
discussion to be tax advice. You should consult with your own tax advisor
before purchasing a Policy. SEE "Tax Matters."

DO I HAVE A "FREE LOOK" RIGHT TO EXAMINE THE POLICY?

Yes. You may cancel the Policy within 10 days after receiving it, or
such longer period as state law may require. USAA Life will refund the greater
of your premium payments or the value of the Variable Fund Accounts as of the
Date of Receipt of your cancellation request. SEE "Free Look Right."

POLICY INFORMATION

POLICY ISSUANCE

WHO MAY PURCHASE A POLICY

Any individual of legal age in a state where the Policies may be
lawfully sold can apply to purchase a Policy. However, we will not issue a
Policy that insures a person who is over 80 years of age.

HOW TO PURCHASE A POLICY

To obtain a Policy, you must complete an application and submit it,
along with your initial premium payment (if required), to our Home Office. You
also must provide us with satisfactory evidence of your insurability as part
of the application or "underwriting" process. During the underwriting process,
we will normally ask you to complete a medical examination so that we can

assign you to an underwriting or "rate" class that we will use to determine
your cost of insurance charges.

After we complete our underwriting process, we will promptly notify you
of our decision regarding your application. We reserve the right to reject any
application for any reason. If we accept your application, the insurance
coverage provided by your Policy will begin as of the Effective Date. We may,
in our discretion, backdate the Effective Date of a Policy by up to six months
prior to the date of your application, if by doing so the Insured's issue age,
and hence your cost of insurance charges, would be lower. If we backdate a
Policy, your initial premium must include sufficient premium to cover the
backdating period. We will make Monthly Deductions for the period the Policy
is backdated. You will not receive any investment performance for the
backdating period.

EFFECTIVE DATE OF YOUR POLICY

Insurance coverage begins on the Policy's Effective Date. We will need
to receive your first premium payment to put your Policy into effect, unless
the Specified Amount you are applying for, plus any other insurance you
currently have with USAA Life, exceeds $500,000, in which case we will bill
you. If you pay your first full premium with your Policy application and we
issue the Policy as applied for, the Effective Date will ordinarily be the
date we approve the application and issue your Policy.

PREMIUM PAYMENTS

METHODS OF PAYMENT

We accept premium payments made by check or money order drawn on a U.S.
bank in U.S. dollars and made payable to "USAA Life Insurance Company" or
"USAA Life." We also accept premium payments made by bank draft, by wire, or
by exchange from another insurance company. All premium payments must be sent
directly to our Home Office. You can also use our Automatic Payment Plan to
have monthly premium payments automatically deducted from your bank account.
For further information about how to make premium payments by these methods
and any other method we may make available, please contact us by calling
1-800-531-8000.

AMOUNT AND FREQUENCY OF PAYMENTS

You generally have the flexibility to determine the amount and frequency
of your premium payments. You must, however, maintain sufficient cash value to
keep your Policy in effect. SEE "Lapse and Reinstatement." In addition, you
must observe the limitations described below.

INITIAL PREMIUM PAYMENT. To issue a Policy, we generally require that
you provide us with an initial premium payment equal to at least one full
Planned Periodic Premium Payment, as specified in your Policy. If you have

elected to use our Automatic Payment Plan, the minimum initial premium payment
would equal two (2) monthly payments under the Plan.

MINIMUM AND MAXIMUM PREMIUM PAYMENTS. Except for your initial premium
payment, we do not require any minimum premium payment. However, at no time
may the total amount of your premium payments exceed the maximum amount
allowed by federal tax law, unless necessary to prevent lapse. We will monitor
your premium payments to be sure that you do not exceed that limitation or
inadvertently incur any tax penalties due to excess premium payments. If a
premium payment would cause you to exceed the maximum amount allowed by
federal tax law, we will refund the excess premium payment to you. We also may
invite you to apply, subject to proof of insurability, to increase the
Specified Amount of your Policy. For more information, please refer to "Tax
Matters."

ALLOCATION OF PREMIUMS

On your Policy application, you must specify how much of your Net
Premium Payments you want to allocate to each Variable Fund Account. You can
specify allocations in increments as small as 1/10th of one percent, provided
that the total amount of your allocations equals 100%.

PREMIUMS RECEIVED DURING THE APPLICATION PROCESS. We will hold your
initial premium payment in our general account during the application process.
During this time, we will not credit any earnings to you.

PREMIUMS RECEIVED DURING FREE LOOK PERIOD. We will allocate your initial
Net Premium Payment to the Money Market Variable Fund Account at the Account's
Accumulation Unit value next computed on the date we accept your application.
We will allocate any subsequent Net Premium Payment that you make during your
Free Look Period to the Money Market Variable Fund Account at the Account's
Accumulation Unit value next computed on the Date of Receipt of the payment.
SEE "Calculating Your Cash Value in the Variable Fund Accounts." Your Net
Premium Payments will remain in the Money Market Variable Fund Account for the
Free Look Period plus five days. On the Valuation Date immediately following
the end of that period, we will allocate your Net Premium Payments, plus any
earnings, among the Variable Fund Accounts in accordance with the allocation
instructions specified on your Policy application, at the Accumulation Unit
value next computed on that Date.

PREMIUMS RECEIVED AFTER FREE LOOK PERIOD. We will allocate Net Premium
Payments that you make after your Free Look Period in accordance with the
allocation instructions specified on your Policy application, unless you
direct otherwise. We will credit your Net Premium Payments to the Variable
Fund Accounts on the Date of Receipt at the Accumulation Unit value next
computed on that Date.

CHANGING YOUR ALLOCATIONS. You may change your allocation instructions
at any time by telephone or by Notice to Us. There are no charges or fees for
changing your allocation instructions. The allocation change will become
effective with the first premium payment we receive on or following the Date
of Receipt of your request.

PLANNED PERIODIC PREMIUM PAYMENTS

You may, for convenience, choose to make planned periodic premium
payments. Your Policy will show a schedule of planned periodic premium
payments and, if you like, we will send you premium notices at quarterly,
semi-annual, or annual intervals. To facilitate planned periodic premium
payments, we also will accept monthly premium payments through our Automatic
Payment Plan. You are not obligated to follow the schedule of planned periodic
premium payments and failing to do so will not itself cause your Policy to
lapse. Conversely, following the schedule will not guarantee that your Policy
will remain in effect, unless you have made enough premium payments to qualify
for the Guaranteed Death Benefit. SEE "Guaranteed Death Benefit."

ANNUAL TARGET PREMIUM PAYMENT

We will use the Annual Target Premium Payment specified in your Policy
to determine whether we will deduct a premium charge from your premium
payments or a surrender charge if you fully surrender. SEE "Premium Charge"
and "Surrender Charge" under "Charges and Deductions." We also will use the
Annual Target Premium Payment to determine whether the Guaranteed Death
Benefit applies. SEE "Guaranteed Death Benefit" under "Lapse and
Reinstatement."

INVESTMENT OPTIONS

Currently, you may invest, through the Separate Account, in up to 12
Funds. The Separate Account consists of 12 Variable Fund Accounts, seven of
which correspond to Funds of USAA Life Investment Trust, three of which
correspond to BT Insurance Funds Trust, and one each of which corresponds to a
Fund of The Alger American Fund and Scudder Variable Life Investment Fund. You
can invest in a Fund by allocating Net Premium Payments to the corresponding
Variable Fund Account.

A brief description of each Fund appears in the table below. For more
information, including a discussion of potential investment and other risks,
please refer to the accompanying prospectuses for the Funds.

Investment Objective
FUND

USAA LIFE INVESTMENT TRUST

MONEY MARKET FUND Highest level of current income consistent
with preservation of capital and
maintenance of liquidity

INCOME FUND Maximum current income without undue risk
to principal

GROWTH AND INCOME FUND Capital growth and current income

WORLD GROWTH FUND Long-term capital appreciation

DIVERSIFIED ASSETS FUND Long-term capital growth, consistent with
preservation of capital and balanced by
current income

AGGRESSIVE GROWTH FUND Appreciation of capital

INTERNATIONAL FUND Capital appreciation with current income
as a secondary objective

THE ALGER AMERICAN FUND

Growth Portfolio Long-term capital appreciation

SCUDDER VARIABLE
LIFE INVESTMENT FUND

Capital Growth Portfolio - Maximize long-term capital growth from a
Class A shares portfolio consisting primarily of equity
securities

BT INSURANCE FUNDS TRUST To replicate as closely as possible the
Equity 500 Index Fund performance of the Standard & Poor's 500
Composite Stock Price Index before the
deduction of Fund expenses.

Small Cap Index Fund To replicate as closely as possible the
performance of the Russell 2000 Index
before the deduction of Fund expenses.

EAFE(R) Equity Index Fund To replicate as closely as possible the
performance of the Morgan Stanley Capital
International Europe, Australia, Far East
(EAFE) Index before the deduction of Fund
expenses.

ADDITIONS OR CHANGES TO INVESTMENT OPTIONS

We may, from time to time, make additional Funds or Mutual Funds
available as investment options through corresponding Variable Fund Accounts.
We may do so when, for example, we believe marketing or investment conditions
warrant.

We also reserve the right, subject to compliance with applicable law, to
change the Funds that are or may be available as investment options. We may,
for example, eliminate or merge one or more Funds or substitute the shares of
a Fund for those of another Fund or Mutual Fund. We may do so, in our sole
discretion, if in our judgment further investment in any Fund would be
inappropriate in view of the purposes of the Policies. We will give you
written notice of the addition, elimination, merger, or substitution of any
Fund as required by law. In any event, the Separate Account may purchase other
securities for other classes of policies.

In the event of any substitution or other change, we may, by appropriate
endorsement, make any changes in your Policy and any future policies as may be
necessary or appropriate to reflect the substitution or change. Also, we may
operate the Separate Account as a management company, we may deregister it
with the SEC in the event such registration is no longer required, or we may
combine it with other USAA Life separate accounts.

VOTING PRIVILEGES

From time to time, a Fund may seek shareholder approval on certain
matters. Each Variable Fund Account is a shareholder of the corresponding Fund
in which it invests. As the depositor of the Variable Fund Accounts, we are
entitled to vote the shares held by the Accounts. However, in our view,
applicable law currently requires us to vote the shares held by our Variable
Fund Accounts in accordance with instructions that we receive from Owners who
have a voting interest in the Funds. We presently intend to do so. We also
will vote shares on which we have received no instructions, as well shares
that we own that are not attributable to Policies, in the same proportion as
we vote shares for which we have received instructions. If, however,
applicable law changes or our view of the law changes, we may elect to vote
the Fund shares in our own right.

The number of Fund shares for which you may provide instructions depends
on your cash value in each corresponding Variable Fund Account, determined as
of the record date established by the Fund for determining shareholders. SEE
"Cash Value." We will send you voting instruction forms and related materials
at the appropriate time.

We may disregard your voting instructions under certain circumstances
permitted by applicable law. In the event we disregard voting instructions, we
will include a summary of that action and the reasons for such action in the
next report to Owners.

SPECIAL CONSIDERATIONS

Each Mutual Fund offers its shares to separate accounts of unaffiliated
life insurance companies to fund benefits under variable annuity contracts and
variable life insurance policies. We do not foresee any disadvantage to Owners
arising out of these arrangements. Nevertheless, differences in treatment
under tax and other laws, as well as other considerations, could cause the
interests of various purchasers of contracts and policies to conflict. For
example, violation of the federal tax laws by one separate account investing
in a Mutual Fund could cause the contracts or policies funded through another
separate account to lose their tax-deferred status, unless remedial action
were taken. If a material irreconcilable conflict arises between separate
accounts, a separate account may be required to withdraw its participation in
a Mutual Fund. If it becomes necessary for any separate account to replace
shares of a Mutual Fund with another investment, the Mutual Fund may have to
liquidate portfolio securities on a disadvantageous basis. At the same time,
each Mutual Fund and USAA Life are subject to conditions imposed by the SEC
that are designed to prevent or remedy any conflict of interest. In this
connection, the Board of Trustees of each Mutual Fund has the obligation to
monitor events in order to identify any material irreconcilable conflict that
may possibly arise and to determine what action, if any, should be taken to
remedy or eliminate the conflict.

POLICY LAPSE AND REINSTATEMENT

LAPSE

Your Policy will lapse at any time that your Policy cash value is
insufficient to pay the Monthly Deduction and any loan interest then due,
unless you have paid enough premiums to qualify for the Guaranteed Death
Benefit. SEE "Guaranteed Death Benefit."

GRACE PERIOD

You have a grace period during which to provide us with sufficient
payment to keep your Policy in force. The grace period will begin on any
Monthly Anniversary when your Policy cash value is insufficient to cover the
Monthly Deduction and any loan interest then due for the following month and
any loan interest then due. We will notify you, and any assignee of record, of
the date the grace period expires and of the premium necessary to continue the
Policy in effect. During the grace period, you must submit enough premium to
cover three (3) Monthly Deductions and any loan interest due. The grace period
is 61 days long and begins on the date we send notice to you.

If you fail to pay the necessary premium within the grace period, all
insurance, including benefits provided by rider, terminates. If the Insured
dies during the grace period, we will pay the death benefit, less any due and
unpaid Monthly Deductions and any loan interest due, to your beneficiary. We
will not refund any cash value remaining in the Policy at the beginning of the
grace period during the grace period or at lapse.

GUARANTEED DEATH BENEFIT

You have the option to pay planned periodic premium payments based on
the Annual Target Premium Payment specified in your Policy. If on any Monthly
Anniversary during your first five (5) Policy Years the total premium you have
paid, less any partial surrenders, is equal to or greater than the Annual
Target Premium Payment specified in your Policy, adjusted to reflect the
number of Monthly Anniversaries that have occurred since the Policy's
Effective Date, then we guarantee that your Policy will not lapse, even if the
cash surrender value is insufficient to pay for the Monthly Deduction and any
loan interest then due. The guarantee death benefit is only available during
the first five (5) Policy Years.

To illustrate how the guaranteed death benefit works, let's assume your
Annual Target Premium Payment is $2,000. If you have paid an amount equal to
three and a half Annual Target Premium Payments or $7,000, your Policy will
not lapse, during the first three and a half Policy Years, even if your cash
surrender value on any Monthly Anniversary during that period is insufficient
to pay your Monthly Deduction and any loan interest then due. The same would
be true on any Monthly Anniversary thereafter, until the fifth Policy Year,
provided you have met the then applicable Annual Target Premium Payment
requirements. Conversely, if you have not met the applicable Annual Target
Premium Payment requirements on any Monthly Anniversary, the guaranteed death
benefit would not apply and your Policy would lapse if your cash surrender
value is insufficient to pay your Monthly Deduction and any loan interest then
due.

If you change your Policy's Specified Amount within the first five (5)
Policy Years, we will declare a new Annual Target Premium Payment and use it
to determine whether the Guaranteed Death Benefit applies.

REINSTATEMENT

You may reinstate a lapsed Policy within five (5) years from the date of
lapse and before the Policy's maturity date. We will require the following for
reinstatement:

1. A completed application for reinstatement;

2. Proof of insurability satisfactory to USAA Life;

3. Payment of premium sufficient to pay the estimated Monthly
Deductions for at least the three (3) Policy months beginning with
the effective date of reinstatement; and

4. Payment of, or agreement to reinstate, any Policy Indebtedness.

The effective date of the reinstated Policy will be the Monthly
Anniversary on or before approval date of reinstatement.

Upon reinstatement, we will reinstate your Policy's death benefit to the
Specified Amount in effect at lapse, less, if applicable, any reinstated
Indebtedness. Your Policy's initial reinstated cash value will be the net
reinstated premium less the Monthly Deduction for the month following the
effective date of the reinstatement plus, if applicable, any reinstated
Indebtedness plus any interest earnings credited to the loan collateral held
in the general account. You will not receive any past performance during the
grace period.

One advantage of reinstating a lapsed Policy is that the first-year-only
administrative charge will not be repeated if it has already been paid. A
possible disadvantage of reinstatement is that any Policy Indebtedness must be
paid or reinstated.

CHARGES AND DEDUCTIONS

PREMIUM CHARGE

We deduct a 3% premium charge from each premium we receive to compensate
us for sales charges and taxes. The resulting Net Premium Payment is the
amount we allocate to the Variable Fund Accounts that you select.

We will deduct the premium charge from all of your premium payments
until the gross amount of premium payments we receive exceeds the sum of the
Annual Target Premium Payments payable over 10 years. If you increase or
decrease the Specified Amount, we will calculate a new Annual Target Premium
Payment for you and use it to and determine whether the premium charge
applies.

To illustrate how this charge works, if your Annual Target Premium
Payment is $2,000, we would no longer deduct the premium charge once you have
paid in premiums of $20,000 ($2,000 per Policy Year for 10 years).

MONTHLY DEDUCTIONS

On your Policy's Effective Date, and each Monthly Anniversary
thereafter, we will deduct certain monthly charges from your Policy's cash
value. SEE "Deduction of Charges." The Monthly Deduction will include your
cost of insurance charges, charges for any optional insurance benefits
provided by rider, an administrative charge, and a maintenance charge, as
described below.

COST OF INSURANCE CHARGES. Your monthly cost of insurance charges will
depend on a number of variables, including the Specified Amount of insurance
coverage and death benefit option you select (both of which affect the net
amount at risk to us), your cost of insurance RATE (which is based on the
Insured's age, sex, and rate class), and the investment experience of your
cash value in the Variable Fund Accounts. For more information on how we
determine your cost of insurance charges, SEE "Calculating Your Cost of
Insurance."

CHARGES FOR OPTIONAL INSURANCE BENEFITS. The Monthly Deduction will
include charges for any optional insurance benefits added to the Policy by
rider. SEE "Optional Insurance Benefits."

ADMINISTRATIVE CHARGE (FIRST POLICY YEAR ONLY). During your first twelve
Policy months only, we will deduct a monthly administrative charge of $10.
This charge compensates us for start-up administrative expenses that we incur
in issuing your Policy. These expenses include, for example, the cost of
processing your application, conducting a medical examination, determining
insurability and rate class, and establishing Policy records. The investment
advisers or other affiliates of certain Mutual Funds reimburse USAA Life for
the cost of administrative services provided to the Funds as investment
options under the Policies. Compensation is paid out of fee earnings, based on
a percentage of a Fund's average net assets attributable to a Policy.

RECURRING MAINTENANCE CHARGE. The Monthly Deduction will include a
recurring maintenance charge of $5. This charge compensates us for the
recurring administrative expenses related to the maintenance of your Policy
and of the Separate Account. These expenses include, for example, premium
notices and collection, recordkeeping, processing death benefit claims, Policy
changes, reporting, and overhead costs. This charge is guaranteed not to
increase during the life of the Policy.

SEPARATE ACCOUNT CHARGES

We deduct certain charges on a daily basis as a percentage of the value
of each Variable Fund Account of the Separate Account. These charges have the
affect of reducing your Policy's cash value.

MORTALITY AND EXPENSE CHARGE. We assess a daily charge of .00204% (equal
to 0.75% annual rate) against the values of each Variable Fund Account for
mortality and expense risks that we assume under the Policies. We guarantee
that this charge will not increase during the life of your Policy. The
mortality risk that we assume is that Insureds may live for a shorter period
of time than we estimate and, thus a greater amount of death benefits than
expected will be payable. The expense risk we assume is that expenses incurred
in issuing and administering the Policies will be greater than we estimate.

FEDERAL INCOME TAX CHARGE. Currently, we make no charge against the
Separate Account for federal income taxes that may be attributable to the
Separate Account. We may, however, make such a charge in the future, should it
be necessary. We also may make charges for other taxes, if any, attributable
to the Separate Account. SEE "Tax Matters."

TRANSFER CHARGES

We assess a $25 charge for each cash value transfer between Variable
Fund Accounts in excess of six (6) per Policy Year. SEE "Transfers of Cash
Value" and "Deduction of Charges."

SURRENDER CHARGES

PARTIAL SURRENDER CHARGE. For each partial surrender of cash value, we
assess a charge equal to the lesser of $25 or 2% of the amount withdrawn. SEE
"Surrenders" and "Deduction of Charges."

FULL SURRENDER CHARGE. For full surrenders prior to the end of the 10th
Policy Year, we assess the surrender charge described below. The purpose of
the surrender charge is to compensate us for the expenses we incur in
distributing the Policies. The amount of the surrender charge will equal a
percentage of the Annual Target Premium Payment specified in your Policy,
regardless of the amount of premiums you actually pay. SEE "Annual Target
Premium Payment." The applicable percentage depends on when you surrender. As
shown in the table below, the applicable percentage declines each Policy Year
to 0% after the 10th Policy Year.

SURRENDER CHARGE AS A % OF ANNUAL TARGET PREMIUM PAYMENT

Policy Year 1 2 3 4 5 6 7 8 9 10 11+
Applicable % 50% 45% 40% 35% 30% 25% 20% 15% 10% 5% 0%

To illustrate how the surrender charge works, if your Annual Target
Premium Payment is $2,000 and you surrendered your Policy in full during the
first Policy Year, the surrender charge would be determined by multiplying 50%
times $2,000 = $1,000. Thus, in this example the surrender charge would be
$1,000.

If you increase or decrease your Policy's Specified Amount within the
first 10 Policy Years, we will declare a new Annual Target Premium Payment for
you, which we will use to determine the surrender charge.

OTHER CHARGES

The Variable Fund Accounts purchase shares of the Funds at the net asset
value of the shares. The net asset value reflects the investment management
fees and other expenses already deducted from each Fund's assets. These fees
and other expenses appear under "The Policy At a Glance." Please refer to the
accompanying prospectuses for the Funds for more information on these fees and
expenses.

DEDUCTION OF CHARGES

Unless you direct otherwise, we will deduct the Monthly Deduction, any
partial surrender charge, and any transfer charge from your cash value in each
Variable Fund Account in proportion to the amount you have invested in each

Account. You may, at any time, change how we deduct your charges by submitting
a Notice to Us.

DEATH BENEFIT

The Policy offers two death benefit options, Option A and Option B,
which you select on your Policy application.

If you select OPTION A, your death benefit will be the greater of (i)
your Policy's Specified Amount or (ii) the Minimum Amount Insured (which is a
specified percentage of your cash value based on the Insured's age). SEE
"Minimum Amount Insured."

If you select OPTION B, your death benefit will be the greater of (i)
your Policy's Specified Amount PLUS your cash value or (ii) the Minimum Amount
Insured. SEE "Minimum Amount Insured."

Under either option, we will reduce the amount of death benefit we pay
by the amount of any outstanding Indebtedness and any due and unpaid Monthly
Deductions. SEE "Payment of Policy Benefits." Please note that partial
surrenders and related surrender charges also will reduce the amount of your
death benefit. SEE "Changing Your Policy's Specified Amount."

CHOOSING BETWEEN OPTION A AND OPTION B.

Both Option A and Option B provide insurance protection and the
opportunity to build your cash value. When choosing between Option A and
Option B, one way to differentiate the two may be to think of Option A as
emphasizing potential cash value growth and Option B as emphasizing potential
death benefit growth, as explained below.

Under Option A, any cash value you build will decrease the net amount at
risk to us relative to the amount of death benefit we must pay if the Insured
dies. As a result, all other things being equal, your cost of insurance
charges generally will be lower under Option A than under Option B for the
same Specified Amount. With lower monthly cost of insurance charges, more of
your cash value can remain invested in the Variable Fund Accounts, thereby
enabling you to build potential cash value faster than you could if you were
paying the higher charges under Option B. There is, however, no minimum
guaranteed cash value, which means you bear the entire investment risk that
your cash value could fall to zero. SEE "Cash Values."

Under Option B, unlike Option A, any cash value you build will increase
the amount of your death benefit. As a result, all other things being equal,
your death benefit under Option B generally will be greater than your death
benefit under Option A for the same Specified Amount.

ILLUSTRATIONS OF OPTION A AND OPTION B

To illustrate the differences between Option A and Option B, let's
assume that the Insured is less than 40 years old, that your Policy's
Specified Amount is $100,000, that you have no loan or outstanding Monthly
Deductions, and that your Policy cash value is $25,000.

Under Option A, your death benefit would be the greater of $100,000 and
the Minimum Amount Insured. Under Option B, your death benefit would be the
greater of $125,000 ($100,000 plus $25,000) and the Minimum Amount Insured.

Under both Options, the death benefit would be higher than the Minimum
Amount Insured, which would be $62,500, in this example. (The Minimum Amount
Insured is calculated by multiplying the cash value by a specific percentage
prescribed by the Internal Revenue Code. In this example, the prescribed
percentage would be 250%. Different percentages apply at different ages, and
generally decline as you get older. SEE "Minimum Amount Insured.")

Now let's assume that instead of $25,000 your cash value is $50,000. The
Minimum Insured Amount would be $125,000 (250% times $50,000). Under Option A,
your Minimum Insured Amount would be greater than the Specified Amount. As a
result, your death benefit would be $125,000. On the other hand, under Option
B, your death benefit ($150,000) would be higher than the Minimum Amount
Insured ($125,000).

CHANGING YOUR DEATH BENEFIT OPTION

After the death benefit option you selected on your Application has been
in effect for one Policy Year, you may change it by sending Notice to Us. The
new death benefit option also must remain in effect for one Policy Year before
we will allow another change. There is no charge or fee for changing the death
benefit option. The change will become effective on the Monthly Anniversary on
or following the date we approve the change.

If you change your death benefit from Option A to Option B, your
Policy's new Specified Amount will be the old Specified Amount DECREASED by
your Policy's cash value (excluding the amount of any outstanding
Indebtedness) next determined on the Date of Receipt of your Notice to Us. We
will not allow this change if it would result in a Specified Amount that is
less than the minimum Specified Amount of $50,000 ($25,000 for Insureds less
than 18 years of age). Changing from Option A to Option B will require proof
of insurability, if you wish your Policy's new Specified Amount under Option B
to be the same as the old Specified Amount under Option A.

If you change your death benefit option from Option B to Option A, your
Policy's new Specified Amount will be the old Specified Amount INCREASED by
your Policy's cash value (excluding the amount of any outstanding
Indebtedness) next determined on the Date of Receipt of your Notice to Us.
Changing from Option B to Option A does not require proof of insurability,
unless you make changes in your Policy's Specified Amount or elect optional
benefits available by rider.

A change in death benefit option will affect your cost of insurance. SEE
"Calculating Your Cost of Insurance." We will recalculate the maximum premium
limitation following a change in death benefit option. SEE "Minimum Amount
Insured" under "Calculating Your Cost of Insurance."

CHANGING YOUR POLICY'S SPECIFIED AMOUNT

Within certain limits, you may increase or reduce your Policy's
Specified Amount. A change in Specified Amount may increase or decrease your
cost of insurance charges. SEE "Calculating Your Cost of Insurance." A change
in the Specified Amount also may have tax consequences. SEE "Tax Matters."
Changes in Specified Amount do not necessarily require changes in planned
periodic premiums. SEE "Planned Periodic Premium Payments." We will
recalculate the maximum premium limitations following an increase or decrease
in Specified Amount. SEE "Premium Payments" and "Tax Matters."

The minimum amount by which you can increase your Policy's Specified
Amount is $25,000. You must apply in writing and we will require satisfactory
proof of insurability. The change will become effective on the Monthly
Anniversary on or following the date we approve the increase. Your rights to
cancel your Policy do not apply to increases in Specified Amount.

We will not allow a reduction (other than that resulting from a partial
surrender of cash value under Option A) that results in a Specified Amount
that is less than $50,000 ($25,000 if the Insured is less than 18 years of
age), nor will we allow a reduction that would cause your Policy not to
qualify as life insurance for federal tax law purposes. Requests for reduction
must be in writing. For purposes of determining your cost of insurance charge,
we will apply any reduction to any increases in the Specified Amount in the
reverse order in which they occurred. The change will become effective on the
Monthly Anniversary on or following the Date of Receipt of your request.

Partial surrenders will reduce your Policy's death benefit on a dollar
for dollar basis unless the death benefit is the Minimum Amount Insured, in
which case your death benefit will be reduced by a multiple of the amount
surrendered. Under death benefit Option A, the Specified Amount and the cash
value will be reduced by the amount of the partial surrender. Under death
benefit Option B, only the cash value portion of the death benefit will be
reduced by the amount of the partial surrender.

OTHER POLICY BENEFITS

OPTIONAL INSURANCE BENEFITS

Subject to certain underwriting or issue requirements, you may add one
or more of the following optional insurance benefits to your Policy by rider.
The rider's description in this Prospectus is subject to the specific terms of

the rider as each contains definitions, contractual limitations, and
conditions. We will deduct the cost of any optional insurance benefits as part
of the Monthly Deduction. SEE "Monthly Deductions."

ACCELERATED BENEFITS FOR TERMINAL ILLNESS RIDER. This rider provides for
an early benefit payment to you upon receipt of proof that the Insured is
terminally ill (as defined in the rider). The rider is not available in all
states. The maximum amount you may receive under the rider prior to the
Insured's death is 50% of the then current death benefit payable under the
Policy (excluding any rider benefits and reduced by any Indebtedness) or, if
less, $250,000 under all life insurance policies that we and our affiliates
have issued on the Insured. We will deduct the amount of any Indebtedness from
the amount of the early payment. The early payment, plus interest on the
payment, and any unpaid Monthly Deductions will become a "lien" against all
future Policy benefits. We will continue to charge interest on the early
payment until the Insured's death. If at any time the amount of the lien, plus
any Indebtedness, exceeds your Policy's then current death benefit, the Policy
will terminate without further value. The cash surrender value of the Policy
also will be reduced by the amount of the lien.

ACCIDENTAL DEATH BENEFIT RIDER. This rider provides an additional life
insurance benefit if the Insured's death results from accidental bodily injury
(as defined in the rider).

CHILDREN TERM LIFE INSURANCE RIDER. This rider provides level term life
insurance on the lives of the Insured's children (as defined in the rider).

EXTENDED MATURITY DATE RIDER. This rider permits you to extend your
Policy's maturity date beyond what it otherwise would be (I.E., the Monthly
Anniversary following the Insured's 100th birthday). The death benefit during
the extended maturity period will be your Policy's cash value less any
Indebtedness. Cost of insurance charges do not apply during this period,
though we will assess a maintenance charge. Extension of the maturity date is
subject to all of the terms and conditions of the Policy, except where they
are inconsistent with the rider. Extending the maturity date of your Policy
beyond the Insured's age 100 may result in the current taxation of any
increases in your Policy's cash value that result from investment experience
in the Variable Fund Accounts. You should consult a qualified tax adviser
before making such an extension.

WAIVER OF MONTHLY DEDUCTION RIDER. This rider waives your Monthly
Deduction during periods of total and permanent disability of the Insured, but
only if the Insured has been totally and permanently disabled (as defined in
the rider) for at least six consecutive months. We will not deduct the amount
of any Monthly Deduction waived under this rider from the cash value proceeds
payable upon maturity of your Policy, or the death benefit proceeds payable if
the Insured dies before the Policy matures. If Option A is in effect when we
approve a claim under the rider, we will change your death benefit option from
Option A to Option B as of the Monthly Anniversary after the disability began.
While we are paying benefits under the rider, you may not increase your
Policy's Specified Amount. Please note that the rider does not apply to
interest under your Policy loans. As a result, it is possible that your Policy
could lapse for nonpayment of loan interest.

If you would like further information about the optional insurance
benefits available under your Policy, please contact us at 1-800-531-8000.
Please note that adding or deleting riders, or increasing or decreasing
coverage under the riders, can have tax consequences. SEE "Tax Matters." You
should consult a qualified tax adviser.

BENEFITS AT MATURITY

If the Insured is living, we will pay the cash value of your Policy,
less any Indebtedness, when your Policy matures. All Policies will mature on
the Monthly Anniversary following the Insured's 100th birthday unless extended
by rider.

PAYMENT OF POLICY BENEFITS

PAYMENT OF DEATH BENEFIT

As long as your Policy has not terminated due to lapse, maturity, or
full surrender, we will pay your Policy's death benefit to your beneficiary.
We will usually pay the death benefit within seven (7) days after we receive
Proof of Death and all other appropriate requirements necessary to make
payment are met. We will determine the cash value portion of the death benefit
as of the Valuation Date immediately following the date of death. We will pay
the death benefit upon receipt of Proof of Death in cash or under one or more
of the payment options you have selected in advance. If you have not selected
a payment option, your beneficiary may select the payment option prior to the
Insured's death. We may postpone payment of the death benefit in certain
circumstances. SEE "Postponement of Payments."

PAYMENT OF MATURITY BENEFIT

If your Policy matures before the Insured dies, we will normally pay you
the cash value of your Policy within seven days after the Valuation Date on
which the Policy matures. We may postpone payments in certain circumstances.
SEE "Postponement of Payments."

We will reduce the cash value by any Indebtedness and any due and unpaid
Monthly Deductions. These proceeds will be increased by any applicable
additional optional insurance death benefits provided by rider and will also
include interest accrued from the date of death to the payment date.

DEATH BENEFIT PAYMENT OPTIONS

We will pay the death benefit in a lump sum or under one of the payment
options below. During the Insured's lifetime, you may select a payment option.
If the Insured dies and you have not chosen a payment option, your beneficiary
can choose a payment option. If you have selected a payment option before the
Insured's death, your beneficiary may not change that option after the

Insured's death. Proceeds applied under a payment option will no longer vary
by the investment experience of the Variable Fund Accounts.

The nature and timing of your choice of payment option can effect the
tax consequences to you or your beneficiary. You should consult your tax
adviser.

INTEREST ONLY OPTION. The Policy's principal amount may be left on
deposit with USAA Life for a mutually determined fixed period, not to exceed
30 years. We will make interest payments at mutually determined regular
intervals. The principal amount will earn interest at a minimum rate of 3%
compounded annually. At the end of the fixed period, we will pay the principal
amount as agreed.

INSTALLMENTS FOR A FIXED PERIOD OPTION. Under this option, we will pay
the principal amount plus interest in equal or unequal installments, as
mutually agreed upon, for a specified number of years (not more than 30), as
mutually agreed upon. The amount of the installments will not be less than
that shown in the Table of Guaranteed Payments contained in your Policy.

INSTALLMENTS OF A FIXED AMOUNT OPTION. Under this option, we will pay
the principal amount plus interest in equal or unequal installments, as
mutually agreed upon, until the amount applied, together with interest on the
unpaid balance, is paid in full.

OTHER OPTIONS. We will apply the sum under any other option mutually
agreed upon.

Any arrangements involving more than one payment option, or involving a
Beneficiary that is not a natural person (E.G, a corporation) or who is a
fiduciary (e.g., a trustee) are subject to our approval. In addition, the
details of the arrangements are subject to our rules in effect at the time the
arrangements take effect.

CASH VALUE

Your Policy's cash value will vary on a daily basis with the investment
experience of the Variable Fund Accounts to which you have allocated your Net
Premium Payments. Your Policy's cash value also will vary to reflect various
Policy transactions, such as additional premium payments, partial surrenders,
and Policy loans, and to reflect applicable charges and deductions. YOUR
POLICY DOES NOT PROVIDE A MINIMUM GUARANTEED CASH VALUE, WHICH MEANS YOU BEAR
THE ENTIRE INVESTMENT RISK THAT YOUR CASH VALUE COULD FALL TO ZERO.

On your Policy's Effective Date, your cash value will equal your Net
Premium Payments, less the Monthly Deduction for the following Policy month.
Thereafter, your cash value on any Valuation Date will equal the sum of your
Policy's cash values invested the Variable Fund Accounts plus, if applicable,
any cash values transferred from the Separate Account to our general account
to secure any Policy loan, plus any interest earnings credited to the loan
account values, less the amount of any outstanding Indebtedness, and less any
Monthly Deductions, transfer charges, and partial surrender charges applied
through that date. SEE "Loans."

CALCULATING YOUR CASH VALUE
IN THE VARIABLE FUND ACCOUNTS

When you invest in a Variable Fund Account, you are purchasing units of
interest or "Accumulation Units" ("units") of that Account. You purchase units
at their price next determined on any given Valuation Date following the
receipt of your payment. Therefore, on any given Valuation Date, you can
calculate the value of your investment in a Variable Fund Account by
multiplying the number of units of each Variable Fund Account credited to your
Policy by the price of the units on that Date.

We determine the number of units to credit to you by dividing (i) the
Net Premium Payments you allocate to a Variable Fund Account by (ii) that
Variable Fund Account's price per unit or "unit value" on the Valuation Date
we receive your payment. Certain transactions will affect the number of units
in a Variable Fund Account credited to you. Net Premium Payments will increase
the number of full or fractional units. Loans, partial or full surrenders,
surrender fees, transfer charges, and Monthly Deductions involve redemption of
full or fractional units and will decrease the number of units. In addition,
transfers of cash value among Variable Fund Accounts will decrease the number
of units in the Variable Fund Accounts from which cash value is transferred
and increase the number of units in the Variable Fund Accounts to which cash
value is transferred.

Each Variable Fund Account's units are valued separately. Initially, the
unit value of all units in each Variable Fund Account was set at the prices
shown in the table below.

Variable Fund Account Unit Value as of May 1, 1998
--------------------- ----------------------------

USAA Life Money Market
USAA Life Income
USAA Life Growth And Income
USAA Life World Growth
USAA Life Diversified Assets
USAA Life Aggressive Growth
USAA Life International
Alger American Growth
Scudder VLIF Capital Growth
BT Equity Index
BT Smallcap Index
BT EAFE(R) Equity Index

Thereafter, the unit value of a Variable Fund Account on any Valuation
Date is calculated by adjusting the unit value from the previous Valuation
Date for: (1) the investment performance of the corresponding Fund, (2) any
dividends or distributions paid by that Fund, (3) the Separate Account charges
that we assess (SEE "Separate Account Charges").

To find out daily what your cash value is, including the value and
number of units of each Variable Fund Account credited to your Policy, please
call us at 1-800-531-8000.

TRANSFER OF CASH VALUE

Except during the first 30 days after your Policy becomes effective, you
may transfer all or part of the cash value in any Variable Fund Account to any
other Variable Fund Account of the Separate Account, up to six (6) times per
Policy Year, without charge. Each transfer thereafter is subject to a $25
charge.

The minimum amount you can transfer from any Variable Fund Account is
$250 (or the remaining cash value in the Variable Fund Account value if less).
A transfer will result in the redemption or purchase (or both) of units of the
Variable Fund Accounts involved. You may request a transfer by telephone or by
Notice to Us. We will effect the transfer using the Variable Fund Account unit
values next computed following the Date of Receipt of your request, unless a
postponement of payments is in effect. SEE "Postponement of Payments."

We reserve the right, at any time, to terminate, suspend, or modify
these transfer privileges.

LOANS

After your first Policy Year, you may borrow money from USAA Life by
using your Policy as the sole security for the loan. The amount that you may
borrow is the "loan value." The maximum loan value is 85% of your cash
surrender value.

You may request a loan by telephone or by Notice to Us, but you must
obtain the written consent of all assignees and irrevocable beneficiaries, if
any, before we can make the loan.

We will usually pay you the loan proceeds within seven (7) days after
the Date of Receipt of your loan request, unless a postponement of payments is
in effect. SEE "Postponement of Payments."

LOAN COLLATERAL

When you take a loan, we will transfer an amount equal to the loan from
your cash value in the Variable Fund Accounts to our general account. We make
this transfer of "loan collateral" to secure your loan. You may specify the
Variable Fund Accounts from which you want us to withdraw the loan collateral.
If you do not so specify, we will withdraw the loan collateral from the
Variable Fund Account in proportion to the amount you have invested in each
Account. While a loan is outstanding, we will credit the loan collateral on a
daily basis with interest at an effective annual rate of 4%.

LOAN INTEREST

We will charge you interest on your loan at a maximum annual rate of 6%
payable in advance. We have the option of charging less. For Policies that
have been in effect more than 10 Policy Years and if the Insured is age 55 or
older, we charge interest at a maximum annual "preferred loan" rate of 4.5%
payable in advance. We have the option of charging less for a preferred loan.
The entire amount of interest on your loan balance for each Policy Year is
payable in advance at the commencement of the loan and at the beginning of
each Policy Year thereafter. We will automatically deduct the interest from
the Variable Fund Accounts in the same proportion as the loan amount was
withdrawn from the Accounts. If you have insufficient cash value in the
Variable Fund Accounts to pay the interest, we will add the amount of any
unpaid interest to your loan principal, and subject it to the same rate of
interest as the principal. Because interest is paid in advance, loan
repayments during a Policy Year may result in an overpayment of interest. We
will credit any overpayment of interest to you on the date of any loan
repayment.

REPAYMENT OF INDEBTEDNESS

You may repay your Indebtedness (I.E., loans and any unpaid interest) in
full or in part at any time before the Insured's death and while the Policy is
in effect. If not repaid, we will deduct the Indebtedness from any death
benefit, maturity benefit, or surrender payable under the Policy.

You must designate any loan repayment as such. Otherwise, we will treat
it as a premium payment instead. You may direct how you want your loan
repayment to be allocated among the Variable Fund Accounts. If you do not
specify an allocation, we will allocate your loan repayment to the Variable
Fund Accounts in the same proportion as each Account's value has to the total
cash surrender value of your Policy.

EFFECT OF POLICY LOANS

A loan will reduce the cash value of the Variable Fund Accounts from
which it is deducted. Thus, the amount loaned will not share in the investment
experience of the Variable Fund Accounts. Therefore, a loan, whether repaid or
not, will have a permanent effect on the cash value of the Policy.

Loan values will be determined as of the Date of Receipt of the loan
request. For situations where a Policy loan may be treated as a taxable
distribution, SEE "Tax Matters."

SURRENDERS

You may fully or partially surrender your Policy for all or part of its
cash value to the extent described below. We will determine the cash value of
the surrendered amount as of the Date of Receipt of your request for

surrender. There may be tax consequences in connection with a full or partial
surrender. See "Tax Matters." You must obtain the written consent of all
assignees or irrevocable beneficiaries, if any, before we will process any
request for surrender.

We will effect any surrenders using the Variable Fund Account unit
values next computed following the Date of Receipt of your Notice to Us or, in
the cash of partial surrenders, your telephone request. In certain
circumstances, we may postpone the payment of surrenders. SEE "Postponement of
Payments."

FULL SURRENDERS

At any time before the Insured's death and while the Policy is still in
effect, you may surrender your Policy for its entire cash surrender value by
sending Notice to us. We may require the return of the Policy. We also may
assess a surrender charge. SEE "Surrender Charges." We sometimes refer to the
net amount you would receive as the Policy's "cash surrender value." Your
Policy and all insurance will terminate on the Date of Receipt of your Notice
to Us.

PARTIAL SURRENDERS

After your first Policy Year and while your Policy is still in effect,
but before the Insured's death, you may surrender a portion of your Policy for
cash. You may direct how you would like us to withdraw a partial surrender
from your cash value in the Variable Fund Accounts. If you do not specify a
withdrawal allocation, we will withdraw the partial surrender from the
Variable Fund Accounts in the same proportion as your cash value in each
Account. We will assess an administrative processing fee equal to the lesser
of $25 or 2% of the amount withdrawn. SEE "Surrender Charges" and "Deductions
for Charges." You may request a partial surrender by telephone or by Notice to
Us.

Partial surrenders and related surrender charges will reduce your death
benefit. SEE "Changing Your Policy's Specified Amount" under "Death Benefit."

TELEPHONE TRANSACTIONS

You may submit requests to change your premium payment allocation,
requests for partial surrenders, requests for loans, and requests for
transfers of cash value among Variable Fund Accounts made by telephone. We
will employ reasonable procedures to confirm that instructions communicated by
telephone are genuine, and only if we do not, will we be liable for any losses
because of unauthorized or fraudulent instructions. We will obtain information
prior to any discussion regarding your Policy including, but not limited to:
(i) your USAA number or Policy number, (ii) your name, and (iii) your social
security number. In addition, we will record all telephone communications with
you and will send confirmations of all transactions to your address. Your
Policy automatically authorizes you to make telephone transactions, subject to
our right to modify, suspend, or discontinue this telephone transaction

privilege at any time without prior notice.

FREE LOOK RIGHT

You may cancel your Policy within 10 days after receiving it, or such
longer period as state law may require by returning the Policy to us along
with a written request for cancellation. Upon its return, we will refund the
greater of your premium payments or the value of the Variable Fund Accounts as
of the Date of Receipt of your written request to cancel, plus any premium
charge, Monthly Deduction, and mortality and expense charge that we deducted.

POSTPONEMENT OF PAYMENTS

We may postpone payments of partial surrenders, full surrenders, Policy
loans, maturity benefits, death benefits, and Variable Fund Account transfers
beyond seven (7) days whenever:

1. the New York Stock Exchange is closed,

2. the SEC, by order, permits postponement for the protection of
Policy Owners, or

3. the SEC requires trading to be restricted or declares an
emergency.

We reserve the right to defer payment of any partial and full surrender
or Policy loans that would be derived from a premium payment made by a check
that has not cleared the banking system.

MORE POLICY INFORMATION

OWNERS AND BENEFICIARIES

OWNERS

If you are the Owner of the Policy, the rights and privileges of the
Policy during the lifetime of the Insured belong to you. Generally, the Owner
is also the Insured, unless a different Owner is designated in the application
or at a later date.

SUCCESSOR OWNER. As Owner, you may designate a successor Owner. If you
die without designating a successor Owner, ownership of the Policy will pass
to your estate.

CHANGE OF OWNERSHIP. As Owner, you may change ownership of your Policy,
at any time, during the Insured's lifetime, by submitting Notice to Us. After
we receive your Notice to Us, the change will take effect on the Date of
Receipt of the request. A change of ownership is subject to the rights of an
assignee of record and those of any irrevocable beneficiary. We are not be
responsible for any payments made or actions taken before we receive your
Written Request.

COLLATERAL ASSIGNMENT. As Owner, you may assign the Policy as collateral
security by submitting a Notice to Us. You will need to obtain the written
consent of any irrevocable beneficiaries and assignees of record before we
recognize any assignment; however, a collateral assignment takes precedence
over the interest of a revocable beneficiary. The assignment will take effect
as of the date we receive your Notice to Us. We are not responsible for the
validity or effect of any collateral assignment, nor are we responsible for
any payment or other action taken before we receive the Written Request. We
are not bound by an assignment until we receive it at our Home Office.

We will pay any death benefit payable to an assignee in one lump sum. We
will pay any remaining proceeds to the designated beneficiary or
beneficiaries. A collateral assignee is not an Owner. A collateral assignment
is not a transfer of ownership, unless it is an absolute assignment. All
collateral assignees of record must consent to any full surrender, partial
surrender, loan or payment from a Policy under an Accelerated Benefits Rider
for Terminal Illness. There may be unfavorable tax consequences, including
recognition of taxable income and the loss of income tax-free treatment for
any death benefit payable to the beneficiary. Therefore, you should consult a
qualified tax adviser prior to making an assignment.

BENEFICIARIES

You may name one or more beneficiaries in your Policy application. You
may classify beneficiaries as primary, contingent, revocable, or irrevocable.
If no primary beneficiary survives the Insured, we will pay the Policy
proceeds to the contingent beneficiaries. Beneficiaries in the same class will
receive equal payments unless you direct otherwise. A beneficiary must survive
the Insured in order to receive his or her share of the death benefit
proceeds. If a beneficiary dies before the Insured dies, his or her unpaid
share is divided among the remaining beneficiaries of the same class who
survive the Insured. If no beneficiary survives the Insured, we will pay the
proceeds to you, if you are alive, or, if not, to your estate.

CHANGE OF BENEFICIARY. You may change the beneficiary while the Insured
is living, by submitting a Notice to Us. You must obtain the written consent
of any irrevocable beneficiaries before we will accept any change in
beneficiary. After we receive Notice to Us, the change in it will take effect
as of the Date of Receipt of your Notice. We will not be responsible for any
payment or other action taken before receipt of the change request. If we make
a payment of death benefits in good faith before receiving the Notice, we will
receive credit for the payment against our liability under the Policy. We may
require you to return the Policy for endorsement of the beneficiary change. A
change of Beneficiary is subject to the rights of an assignee of record.

CALCULATING YOUR COST OF INSURANCE

For each Monthly Anniversary, we determine your monthly cost of
insurance by multiplying (i) the net amount at risk under your Policy by (ii)
your cost of insurance rate.

NET AMOUNT AT RISK

We determine the net amount at risk by subtracting your Policy's cash
value on any Monthly Anniversary from your Policy's current death benefit
(divided by a factor that discounts the Death Benefit to the beginning of the
month). Your Policy's death benefit may be the death benefit required to
qualify the Policy as life insurance. SEE "Minimum Amount Insured."

The net amount at risk may be greater if you have selected death benefit
Option B rather than death benefit Option A. SEE "Death Benefits." Since the
death benefit payable under Option B is the Specified Amount plus the cash
value, the difference between the death benefit and the cash value will be
greater under Option B than under Option A (unless the Minimum Amount Insured
applies). As the net amount at risk will be greater, so the cost of insurance
also will be greater. The net amount at risk also may be affected by changes
in your Policy's cash value or in the Specified Amount. SEE "Cash Value" and
"Death Benefits."

The net amount at risk for each Policy continues to be determined
generally by subtracting the Policy's cash value from the Policy's death
benefit (discounted for one month's interest), regardless of whether the death
benefit is the Policy's current Specified Amount or the Minimum Amount
Insured. The cost of insurance rate applied against the net amount at risk
will continue to increase as the Insured's age increases.

NET AMOUNT AT RISK - MORE THAN ONE RATE CLASS

If you increase the Specified Amount and the rate class applicable to
the increase is different from that of the initial Specified Amount, then, in
determining the cost of insurance charge, the net amount at risk will be
calculated separately for each rate class. The method of determining the net
amount at risk for each rate class will differ between Option A and Option B.
If Option A is in effect, the cash value will be apportioned among the initial
Specified Amount and any increases in Specified Amount. The cash value will
first be considered a part of the initial Specified Amount. If the cash value
is greater than the initial Specified Amount, the balance of the cash value
will then be considered a part of each increase in Specified Amount, beginning
with the first increase.

If Option B is in effect, the net amount at risk will be determined by
the proportional relationship of the initial Specified Amount and the
Specified Amount increases for each new rate class to the total Specified
Amount.

Because the method of calculating the net amount at risk is different
between Option A and Option B when more than one rate class is in effect, a
change in the death benefit option may result in a different net amount at
risk for each rate class than would have occurred had the death benefit option

not been changed. Thus, the total cost of insurance will be increased or
decreased.

COST OF INSURANCE RATES

Your cost of insurance rates are based on your Insured's age, sex, and
rate class. Generally, we set cost of insurance rates based on our
expectations as to future mortality experience. We apply any changes to cost
of insurance rates to all persons of the same age, sex, and rate class. We
will give you 30 days' notice before any increase in your current cost of
insurance rates becomes effective. We guarantee that your cost of insurance
rates will never be greater than the maximum cost of insurance rates shown in
your Policy. These guaranteed rates are based on the 1980 Commissioners
Standard Ordinary Mortality Table, age on the Insured's last birthday.

The rate class of your Insured will affect your cost of insurance rate.
USAA Life currently places Insureds into one of three preferred rate classes
or into one of two standard rate classes involving higher mortality risks. In
an otherwise identical Policy, Insureds in the preferred rate class will have
a lower cost of insurance rate than those in a standard rate class. We make
all final determinations of an Insured's rate class.

MINIMUM AMOUNT INSURED

If higher than the death benefit under Option A or Option B, we will pay
you the Minimum Amount Insured. The Minimum Amount Insured is the amount of
insurance proceeds that the Internal Revenue Code requires for your Policy to
qualify as life insurance and to exclude the death benefit from your
beneficiary's gross income. You can determine the Minimum Amount Insured by
multiplying your Policy's cash value (excluding the amount of any outstanding
loan and any unpaid loan interest) by a specified percentage based on the
Insured's age. The specified percentages, which generally decline as the
Insured gets older, are:

MINIMUM INSURED AMOUNT AS A PERCENTAGE OF CASH VALUE

INSURED'S 40 or
AGE* Under 45 50 55 60 65 70 75 to 95 100

PERCENTAGE 250% 215% 185% 150% 130% 120% 115% 105% 100%

<FN>
* Nearest birthday at the beginning of the Policy Year in which the
Insured dies. A more complete table appears in your Policy.
</FN>

If, prior to the Insured's death, unexpected increases in your Policy's
cash value would cause your Policy not to satisfy Internal Revenue Code
requirements, we may increase the death benefit to the Minimum Amount Insured
so that the death benefit will be excluded from the beneficiary's taxable
income.

THE CONTRACT

The Policy is a legal contract between you and us. The consideration for
issuing the Policy is:

1. completion of the application, and

2. payment of the first full premium.

Your Policy, your Policy application, any supplemental applications,
riders, endorsements, and amendments form the entire contract. We will
consider statements in the application as representations and not warranties.
We will not use any representation to void your Policy or defend a claim under
your Policy unless it is contained in your written application or supplemental
application. Only the president or secretary of USAA Life has authority to
change or waive a provision of your Policy, and then only in writing.

INCONTESTABILITY

We will not contest a Policy, or any increase in Specified Amount,
except for lapse or fraud, after the Policy or increase has been in effect
during the Insured's lifetime for two years. Any increase in the Specified
Amount will have its own two-year contestable period beginning with the
Effective Date of the increase. During any two-year contestable period, we
have the right to contest the validity of your Policy based on material
misstatements made in the application or any supplemental application. The
two-year contestable period begins on the Effective Date of your Policy, or,
in the case of an increase, on the date the increase is approved and made
effective.

If your Policy is reinstated after lapse, it will have a two-year
contestable period beginning with the date of reinstatement. This contestable
period will apply only to statements made in the reinstatement application.

The incontestability provisions do not apply to optional Policy benefits
added by rider. Each rider contains its own incontestability provision.

If we contest and rescind your Policy, you will receive your premiums
paid, less any Indebtedness and any previous partial surrenders.

MISSTATEMENT OF AGE OR SEX

Age means the Insured's age on his or her last birthday. If the
Insured's age or sex has been misstated on the application or any supplemental
application, we will adjust the cash values and death benefits to those based
on the correct Monthly Deductions since the Policy's Effective Date.

SUICIDE EXCLUSION

Your Policy does not cover suicide by the Insured, while sane or insane,
during the first two years after the Policy's Effective Date. If the Insured
commits suicide during this period, our sole liability will be to refund all
premiums paid, less Indebtedness and previous partial surrenders. We will not
pay any death benefit in those circumstances.

If your Policy lapses and is later reinstated, we will measure the
two-year suicide exclusion period from the Effective Date of reinstatement. If
you increase your Policy's Specified Amount, we will measure the two-year
suicide exclusion period for the increase from the increase's Effective Date.
If the Insured dies as a result of suicide (whether sane or insane) during the
separate two-year suicide exclusion period, we will only pay the death benefit
attributable to the initial Specified Amount (on which the two-year suicide
exclusion period has expired). We will refund the premium payments less any
Indebtedness and any partial surrenders attributable to the increase in the
Specified Amount.

NON-PARTICIPATING POLICY

Your Policy is "non-participating," which means you will not share in
any of our profits or surplus earnings. We will not pay dividends on your
Policy.

REPORTS AND RECORDS

We will maintain all records relating to the Policy and the Separate
Account. We will mail to you a Policy annual statement showing:

(1) the amount of death benefit;
(2) the cash value;
(3) any Indebtedness;
(4) any loan interest incurred since the last annual report;
(5) any loan repayment since the last annual report;
(6) any partial surrender since the last annual report;
(7) all premium payments since the last annual report;
(8) all deductions and charges since the last annual report; and,
(9) other pertinent information required by any applicable law or
regulation, or that we deem helpful to you.

We will mail the statement within 30 days after the Policy's
anniversary, or, at our discretion, within 30 days after the end of each
calendar year showing information as of a date not more than 60 days prior to
the mailing of the annual report. We also will send you periodic reports for
the Funds that correspond to the Variable Fund Accounts, periodic reports for
the Separate Account, and any other information, as required by state and
federal law.

We will mail confirmation notices (or other appropriate notification)
promptly at the time of the following transactions:

(1) Policy issue;
(2) receipt of premium payments;
(3) transfers among Variable Fund Accounts;
(4) change of premium allocation;
(5) change of death benefit options;
(6) increases or decreases in Specified Amount;
(7) partial surrenders;
(8) receipt of loan repayments; and,
(9) reinstatement.

PERFORMANCE INFORMATION

From time to time, we may quote performance information for the Variable
Fund Accounts of the Separate Account in advertisements, sales literature, or
reports to Owners or prospective investors.

We may quote performance information in any manner permitted under
applicable law. We may, for example, present such information as a change in a
hypothetical Owner's cash value or death benefit. We also may present the
yield or total return of the Variable Fund Accounts based on a hypothetical
investment in a Policy. The performance information shown may cover various
periods of time, including periods beginning with the commencement of the
operations of the Variable Fund Account or the Fund in which it invests. The
performance information shown may reflect the deduction of only some of the
applicable charges to the Policy. We may, for example, exclude the deduction
of one or more charges, such as the premium charge or surrender charge, and we
generally expect to exclude cost of insurance charges because of the
individual nature of these charges.

We may compare a Variable Fund Account's performance to that of other
variable life separate accounts or investment products, as well as to
generally accepted indices or analyses, such as those provided by research
firms and rating services. In addition, we may use performance ratings that
may be reported periodically in financial publications, such as MONEY
MAGAZINE, FORBES, BUSINESS WEEK, FORTUNE, FINANCIAL PLANNING, and THE WALL
STREET JOURNAL. We also may advertise ratings of USAA Life's financial
strength or claims-paying ability as determined by firms that analyze and rate
insurance companies and by nationally recognized statistical rating
organizations.

Performance information for any Variable Fund Account reflects the
performance of a hypothetical Policy and are not illustrative of how actual
investment performance would affect the benefits under your Policy. Therefore,
you should not consider such performance information to be an estimate or
guarantee of future performance.

OTHER INFORMATION

USAA LIFE

USAA Life is a stock insurance company incorporated in the State of
Texas in June 1963. USAA Life is principally engaged in writing life insurance
policies, health insurance policies, and annuity contracts. USAA Life is
authorized to transact insurance business in all states of the United States
(except New York) and the District of Columbia. USAA Life on a consolidated
basis had total assets of $_____________ on December 31, 1997. USAA Life is a
wholly-owned stock subsidiary of USAA. The commitments under the Policies are
USAA Life's, and USAA has no legal obligation to back those commitments.

USAA Life is the depositor administering the Separate Account. USAA
Life's obligations as depositor of the Separate Account may not be transferred
without notice to and consent of the Owners. USAA Life also issues variable
annuity contracts through another separate account, which is also a registered
investment company. In addition, USAA Life serves as transfer agent of the
USAA Life Investment Trust.

DIRECTORS OF USAA LIFE. USAA Life is managed by its Board of Directors,
described below, all of whom are also officers of either USAA or USAA Life and
have the same principal business address as USAA Life, as shown on the front
cover page of this Prospectus.

Name Principal Occupation (Past Five Years)
---- -------------------------------------

Edwin L. Rosane Vice Chairman, Chief Executive
Officer/President.

Robert G. Davis Chairman since June 1997; prior thereto,
Director since December 1996; Chief
Executive Officer and President of USAA
CAPCO since December 1996; prior thereto,
Special Assistant to CEO, USAA, since June
1996; prior thereto, Chief Executive
Officer and President of Bank One,
Columbus, since 1991.

Bradford W. Rich Director, General Counsel & Secretary;
Senior Vice President, USAA, since January
1996; prior thereto, Senior Vice President
and Special Assistant to CEO, USAA, since
December 1995; prior thereto, Executive
Vice President and General Counsel, ACE
Limited.

Josue Robles, Jr. Director; Senior Vice President, Chief
Financial Officer/Treasurer, USAA, since
August 1995; prior thereto, Senior Vice
President, Chief Financial
Officer/Controller, USAA, since September
1994; prior thereto, Special Assistant to
Chairman, USAA, since July 1994; prior
thereto, Active Service with U.S. Army
since 1966.

Michael J.C. Roth Director; Chief Executive Officer and
President, USAA IMCO, since October 1993
and January 1990, respectively.

Janice E. Marshall Director since June 1997; President, USAA
Buying Services, since March 1996, prior
thereto, Senior Vice President, Central
Region & Regional Services, USAA P&C,
since November 1994, prior thereto,
Regional Vice President, USAA P&C, since
January 1993.

William B. Tracy Director since June 1997; Senior Vice
President, Human Resources, USAA, since
June 1988.

Donald R. Walker Director since June 1997; Chief
Information Officer, USAA, and President &
CEO, USAA ITCO, since January 1996; prior
thereto, Special Assistant to Chairman,
USAA, since November 1995; prior thereto,
Active Duty with U.S. Air Force since
1966.

OFFICERS (OTHER THAN DIRECTORS). The senior officers of USAA Life, other
than the Directors named above, and the officers responsible for variable life
operations are described below. The principal business address of each person
listed is same as the address of USAA Life, as shown on the cover page of this
Prospectus.

Name Principal Occupation (Past Five Years)
---- -------------------------------------

John W. Douglas Senior Vice President, Life & Health
Operations, since January 1997; prior
thereto, Senior Vice President, Life &
Health Marketing, since January 1995;
prior thereto, Senior Vice President, Life
& Health Marketing, since 1990.

Kenneth A. McClure Senior Vice President, Life & Health
Marketing, since January 1997; prior
thereto, Senior Vice President, Life &
Health Operations, since January 1995;
prior thereto, Senior Vice President, Life
& Health Operations, since August 1992.

James A. Robinson Treasurer/Senior Vice President, Finance,
since April 1992.

Edward R. Dinstel Vice President, Life & Health
Underwriting/Issue, since July 1991.

Larkin W. Fields Vice President, Life Marketing Services,
since November 1995; prior thereto, Vice
President, Corporate Actuary, since
September 1994; prior thereto, Vice
President, Accounting, August 1993; prior
thereto, Assistant Vice President,
Operating Accounting, since May 1990.

Robert J. Flannery Vice President, Actuarial Valuation, since
January 1998; Vice President,
Actuary-Annuities & Life Products, since
March 1997; prior thereto, Vice President,
Actuary, since March 1994; prior thereto,
Assistant Vice President, Life Products
Actuary, since September 1988.

Richard T. Halinski, Jr. Assistant Secretary; Vice President and
Managing Attorney of Life & Health, USAA,
since November 1994; prior thereto,
Assistant Vice President and Managing
Attorney of Life & Health, USAA, since
November 1990.

Ronald W. Holtkamp Vice-President-Assistant Treasurer; Senior
Vice President-Senior Financial Officer,
Financial Service Center, USAA, since
December 1997; prior thereto Senior Vice
President, Controller, USAA, since June
1989.

King Mawhinney Vice President, Life Sales since May 1997;
prior thereto, Vice President, Health
Insurance, since September 1994; prior
thereto, Assistant Vice President, Health
Insurance, since December 1992.

Pattie S. McWilliams Vice President, Life/Annuity Service &
Claims, since September 1993; prior
thereto, Assistant Vice President, Policy
Owner Services, since May 1988.

James M. Middleton Vice President, Systems Integration &
Program Control, since September 1997;
prior thereto, Assistant Vice President,

Systems Integration & Analysis, since
March 1994; prior thereto, Executive
Director, Systems Integration & Program
Control, since 1992.

Stephen N. Patzman Vice President, Corporate Actuary since
November 1995; prior thereto, Vice
President, Operational Accounting, since
September 1994; prior thereto, Assistance
Vice President, Actuary, since July 1979.

Leldon W. (Jack) Ward Vice President, Health Insurance since May
1997; prior thereto, Vice President, Life
Sales, Life & Health Marketing, since
January 1996; prior thereto, Assistant
Vice President, USAA Life General Agency,
since December 1992.

Dwain A. Akins Assistant Secretary; Assistant Vice
President and Managing Attorney of Life &
Health Insurance Counsel, USAA, since
November 1994; prior thereto, Executive
Director and Managing Attorney, Life &
Health Insurance Counsel, USAA, since
February 1991.

Bruce W. Clements Assistant Vice President-Deputy General
Counsel and Assistant Secretary; Senior
Vice President for P&C Counsel, USAA,
since September 1997; prior thereto, Vice
President-Deputy General Counsel, USAA,
since June 1991.

James R. Latham Assistant Vice President, Health Insurance
Services, since March 1997; prior thereto,
Executive Director, Health Insurance
Services, since 1992.

Allen R. Pierce Assistant Vice President, Actuary -
reinsurance, Specialty Markets and Life
Insurance, since January 1998; Assistant
Vice President, Actuarial Support &
Management Accounting Products and other
related departments, since September 1994;
prior thereto, Executive Director, since
1992.

Gary D. Younglove Assistant Vice President & Administration,
since September 1994; prior thereto,
Executive Director, Plans &
Administration, since 1992.

You should also review the accompanying Fund prospectuses for a
description of the management of the Funds.

SEPARATE ACCOUNT

The Separate Account was established by a resolution of the Board of
Directors of USAA Life as a separate account on January 20, 1998. The Separate
Account is organized as a unit investment trust and registered with the SEC
under the Investment Company Act of 1940. Registration does not involve
supervision of the management of the Separate Account by the SEC.

The assets of the Separate Account are the property of USAA Life and are
held for the benefit of the Owners and other persons entitled to payments
under Policies issued through the Separate Account. The assets of the Separate
Account equal to the reserves and other liabilities of the Separate Account
are not chargeable with liabilities that arise from any other business which
USAA Life may conduct.

The Separate Account is divided into Variable Fund Accounts, each
representing a different investment objective. Net Premium Payments are
allocated to the Variable Fund Accounts in accordance with your instructions.
SEE "Investment Options." Each Variable Fund Account invests exclusively in
the shares at the net asset value of a Fund. Income and gains and losses from
assets in each Variable Fund Account are credited to, or charged against, that
Variable Fund Account without regard to income, gains, or losses in the other
Variable Fund Accounts.

POLICY DISTRIBUTION

We intend to sell the Policy in all states in which we are licensed and
the District of Columbia. USAA Investment Management Company ("USAA IMCO"),
located at 10750 Robert F. McDermott Freeway, San Antonio, Texas 78288, is the
principal underwriter distributing the Policy. USAA IMCO, a Texas corporation
organized in May 1970, is registered with the SEC under the Securities
Exchange Act of 1934 as a broker-dealer and is an active member of the
National Association of Securities Dealers, Inc.

The Policy will be sold by licensed life insurance sales representatives
who are also registered representatives of USAA IMCO. These licensed insurance
sales representatives are salaried employees and receive neither direct nor
indirect commissions nor any renewal commissions from the sale of the
policies.

USAA IMCO serves as principal underwriter for the Policies pursuant to
an amended and restated Distribution and Administration Agreement with USAA
Life dated February 18, 1998. Pursuant to this agreement, USAA Life bears the
cost of the salaries of the sales representatives who sell the policies and
substantially all other distribution expenses of the Policies. The agreement
terminates upon its assignment or upon at least ninety days' notice by either
party. USAA IMCO also serves as principal underwriter and investment adviser
for the following other registered investment companies: USAA Tax Exempt Fund,
Inc., USAA Investment Trust, USAA State Tax-Free Trust, USAA Mutual Fund,
Inc., USAA Life Investment Trust. In addition, USAA IMCO serves as principal

underwriter for the Separate Account of USAA Life, a registered investment
company.

TAX MATTERS

The following is a discussion of certain federal income tax matters. We
do not intend this to be tax advice, nor does the following summary purport to
be complete or to cover all situations. You should consult your counsel and
other competent advisers for more complete information.

The individual situation of each Owner or beneficiary will determine how
ownership or receipt of Policy proceeds will be treated for purposes of the
federal estate tax, the state inheritance tax and other taxes.

TAXATION OF POLICY PROCEEDS

The following discussion is based on current federal income tax law and
interpretations. It assumes that the Owner is a natural person who is a U.S.
citizen and resident. The tax effects on non-U.S. residents or non-U.S.
citizens may be different. The discussion is general in nature, and should not
be considered tax advice, for which you should consult a qualified tax
adviser.

GENERAL. A Policy will be treated as "life insurance" for federal income
tax purposes (a) if it meets the definition of life insurance under Section
7702 of the Internal Revenue Code (the "Code") and (b) for as long as the
investments made by the underlying Mutual Funds satisfy certain investment
diversification requirements under Section 817(h) of the Code. We believe that
the Policies will meet these requirements and that:

o the death benefit received by the beneficiary under your Policy
will not be subject to federal income tax; and

o increases in your Policy's cash value as a result of investment
experience will not be subject to federal income tax unless and
until there is a distribution from your Policy, such as a
surrender or a partial surrender.

The federal income tax consequences of a distribution from your Policy
can be affected by whether your Policy is determined to be a "modified
endowment contract" (which is discussed below). In all cases, however, the
character of all income that is described below as taxable to the payee will
be ordinary income (as opposed to capital gain).

TESTING FOR MODIFIED ENDOWMENT CONTRACT STATUS. Your Policy will be a
"modified endowment contract" if, at any time during the first seven Policy
Years, you have paid a cumulative amount of premiums that exceeds the premiums
that would have been paid by that time under a similar fixed-benefit insurance
policy that was designed (based on certain assumptions mandated under the

Code) to provide for paid-up future benefits after the payment of seven level
annual premiums. This is called the "seven-pay" test.

Whenever there is a "material change" under a Policy, the Policy will
generally be (a) treated as a new contract for purposes of determining whether
the Policy is a modified endowment contract and (b) subjected to a new
seven-pay period and a new seven-pay limit. The new seven-pay limit would be
determined taking into account, under a prescribed formula, the accumulation
value of the Policy at the time of such change. A materially changed Policy
would be considered a modified endowment if it failed to satisfy the new
seven-pay limit. A material change for these purposes could occur as a result
of a change in death benefit option, the selection of additional rider
benefits, an increase in your Policy's Specified Amount of coverage, and
certain other changes.

If your Policy's benefits are reduced during the first seven Policy
Years (or within seven years after a material change), the calculated
seven-pay premium limit will be redetermined based on the reduced level of
benefits and applied retroactively for purposes of the seven-pay test. (Such a
reduction in benefits could include, for example, a decrease in Specified
Amount you request or, in some cases, a partial surrender or termination of
additional benefits under a rider.) If the premiums previously paid are
greater than the recalculated seven-payment premium level limit, the Policy
will become a modified endowment contract. A life insurance policy that is
received in exchange for a modified endowment contract will also be considered
a modified endowment contract.

OTHER EFFECTS OF POLICY CHANGES. Changes made to your Policy (for
example, a decrease in benefits or a lapse or reinstatement of your Policy)
may also have other effects on your Policy. Such effects may include impacting
the maximum amount of premiums that can be paid under your Policy, as well as
the maximum amount of accumulation value that may be maintained under your
Policy.

TAXATION OF PRE-DEATH DISTRIBUTIONS IF YOUR POLICY IS NOT A MODIFIED
ENDOWMENT CONTRACT. As long as your Policy remains in force during the
Insured's lifetime as a non-modified endowment contract, a Policy loan will be
treated as indebtedness, and no part of the loan proceeds will be subject to
current federal income tax. Interest on the loan generally will not be tax
deductible.

After the first 15 Policy Years, the proceeds from a partial surrender
will not be subject to federal income tax except to the extent such proceeds
exceed your "basis" in your Policy. (Your basis generally will equal the
premiums you have paid, less the amount of any previous distributions from
your Policy that were not taxable.) During the first 15 Policy Years, the
proceeds from a partial surrender or a reduction in insurance coverage could
be subject to federal income tax, under a complex formula, to the extent that
your cash value exceeds your basis in your Policy.

On the maturity date or upon full surrender, any excess in the amount of
proceeds we pay (including amounts we use to discharge any Policy loan) over
your basis in the Policy, will be subject to federal income tax. In addition,

if a Policy terminates after a grace period while there is a Policy loan, the
cancellation of such loan and accrued loan interest will be treated as a
distribution and could be subject to tax under the above rules. Finally, if
you make an assignment of rights or benefits under your Policy you may be
deemed to have received a distribution from your Policy, all or part of which
may be taxable.

TAXATION OF PRE-DEATH DISTRIBUTIONS IF YOUR POLICY IS A MODIFIED
ENDOWMENT CONTRACT. If your Policy is a modified endowment contract, any
distribution from your Policy during the Insured's lifetime will be taxed on
an "income-first" basis. Distributions for this purpose include a loan
(including any increase in the loan amount to pay interest on an existing loan
or an assignment or a pledge to secure a loan) or partial surrender. Any such
distributions will be considered taxable income to you to the extent your cash
value exceeds your basis in the Policy. (For modified endowment contracts,
your basis is similar to the basis described above for other Policies, except
that it also would be increased by the amount of any prior loan under your
Policy that was considered taxable income to you.) For purposes of determining
the taxable portion of any distribution, all modified endowment contracts
issued by the same insurer (or its affiliate) to the same owner (excluding
certain qualified plans) during any calendar year are aggregated. The U.S.
Treasury Department has authority to prescribe additional rules to prevent
avoidance of "income-first" taxation on distributions from modified endowment
contracts.

A 10% penalty tax also will apply to the taxable portion of most
distributions from a Policy that is a modified endowment contract. The penalty
tax will not, however, apply to distributions (i) to taxpayers 59 1/2 years of
age or older, (ii) in the case of a disability (as defined in the Code) or
(iii) received as part of a series of substantially equal periodic annuity
payments for the life (or life expectancy) of the taxpayer or the joint lives
(or joint life expectancies) of the taxpayer and his or her beneficiary. If
your Policy terminates after a grace period while there is a Policy loan, the
cancellation of such loan will be treated as a distribution to the extent not
previously treated as such and could be subject to tax, including the 10%
penalty tax, as described above. In addition, on the maturity date and upon a
full surrender, any excess of the proceeds we pay (including any amounts we
use to discharge any loan) over your basis in the Policy, will be subject to
federal income tax and, unless an exception applies, the 10% penalty tax.

Distributions that occur during a Policy Year in which your Policy
becomes a modified endowment contract, and during any subsequent Policy Years,
will be taxed as described in the two preceding paragraphs. In addition,
distributions from a Policy within two years before it becomes a modified
endowment contract also will be subject to tax in this manner. This means that
a distribution made from a Policy that is not a modified endowment contract
could later become taxable as a distribution from a modified endowment
contract. The Treasury Department has been authorized to prescribe rules which
would treat similarly other distributions made in anticipation of a Policy
becoming a modified endowment contract.

POLICY LAPSES AND REINSTATEMENTS. A Policy which has lapsed may have the
tax consequences described above, even though you may be able to reinstate
that Policy. For tax purposes, some reinstatements may be treated as the
purchase of a new insurance contract.

TERMINAL ILLNESS RIDER. Amounts received under an insurance policy on
the life of an individual who is terminally ill, as defined by the tax law,
are generally excludable from the payee's gross income. We believe that the
benefits provided under our terminal illness rider meet the law's definition
of terminally ill and can qualify for this income tax exclusion. This
exclusion does not apply, however, to amounts paid to someone other than the
Insured, if the payee has an insurable interest in the Insured's life because
the Insured is a director, officer or employee of the payee or by reason of
the Insured being financially interested in any trade or business carried on
by the payee.

DIVERSIFICATION. Under Section 817(h) of the Code, the Treasury
Department has issued regulations that implement investment diversification
requirements. Failure by us to comply with these regulations would disqualify
your Policy as a life insurance policy under Section 7702 of the Code. If this
were to occur, you would be subject to federal income tax on the income under
the Policy for the period of the disqualification and for subsequent periods.
Our Separate Account, through the Mutual Funds, intends to comply with these
requirements.

In connection with the issuance of then temporary diversification
regulations, the Treasury Department stated that it anticipated the issuance
of guidelines prescribing the circumstances in which the ability of a Policy
Owner to direct his or her investment to particular Mutual Funds within a
Separate Account may cause the Owner, rather than the insurance company, to be
treated as the owner of the assets in the account. If you were considered the
owner of the assets of the Separate Account, income and gains from the account
would be included in your gross income for federal income tax purposes. USAA
Life reserves the right to amend the Policies in any way necessary to avoid
any such result. As of the date of this Prospectus, no such guidelines have
been issued, although the Treasury Department has informally indicated that
any such guidelines could limit the number of investment funds or the
frequency of transfers among such funds. These guidelines may apply only
prospectively, although retroactive application is possible if such standards
are considered not to embody a new position.

ESTATE AND GENERATION SKIPPING TAXES. If the Insured is the Policy
Owner, the death benefit under a Policy will generally be includable in the
Owner's estate for purposes of federal estate tax. If the Owner is not the
insured person, under certain conditions, only an amount approximately equal
to the cash surrender value of the Policy would be includable. Federal estate
tax is integrated with federal gift tax under a unified rate schedule. In
general, estates less than $625,000 (increasing annually, beginning in 1999,
to $1 million in 2006 and thereafter) will not incur a federal estate tax
liability. In addition, an unlimited marital deduction may be available for
federal estate tax purposes.

As a general rule, if a "transfer" is made to a person two or more
generations younger than the Policy's Owner, a generation skipping tax may be
payable at rates similar to the maximum estate tax rate in effect at the time.
The generation skipping tax provisions generally apply to "transfers" that
would be subject to the gift and estate tax rules. Individuals are generally
allowed an aggregate generation skipping tax exemption of $1 million. Because
these rules are complex, you should consult with a qualified tax adviser for

specific information, especially where benefits are passing to younger
generations.

If the Owner of the Policy is not the Insured, and the Owner dies before
the Insured, the value of the Policy, as determined under Internal Revenue
Service regulations, is includable in the federal gross of the Owner for
federal estate tax purposes. Whether a federal estate tax is payable depends
on a variety of factors, including those listed in the preceding paragraph.

The particular situation of each Owner, Insured or beneficiary will
determine how ownership or receipt of Policy proceeds will be treated for
purposes of federal estate and generation skipping taxes, as well as state and
local estate, inheritance and other taxes.

PENSION AND PROFIT-SHARING PLANS. If Policies are purchased by a trust
or other entity that forms part of a pension or profit-sharing plan qualified
under Section 401(a) of the Code for the benefit of participants covered under
the plan, the federal income tax treatment of such Policies will be somewhat
different from that described above.

If purchased as part of a pension or profit-sharing plan, the reasonable
net premium cost for such amount of insurance is required to be included
annually in the plan participant's gross income. This cost (generally referred
to as the "P.S. 58" cost) is reported to the participant annually. If the plan
participant dies while covered by the plan and the Policy proceeds are paid to
the participant's beneficiary, then the excess of the death benefit over the
Policy's cash value will not be subject to federal income tax. However, the
Policy's cash value will generally be taxable to the extent it exceeds the
participant's cost basis in the Policy. The participant's cost basis will
generally include the costs of insurance previously reported as income to the
participant. Special rules may apply if the participant had borrowed from the
Policy or was an owner-employee under the plan.

There are limits on the amounts of life insurance that may be purchased
on behalf of a participant in a pension or profit-sharing plan. Complex rules,
in addition to those discussed above, apply whenever life insurance is
purchased by a tax qualified plan. You should consult a qualified tax adviser.

OTHER EMPLOYEE BENEFIT PROGRAMS. Complex rules may also apply when a
Policy is held by an employer or a trust, or acquired by an employee, in
connection with the provision of other employee benefits. These Policy Owners
must consider whether the Policy was applied for by or issued to a person
having an insurable interest under applicable state law and with the insured
person's consent. The lack of an insurable interest or consent may, among
other things, affect the qualification of the Policy as life insurance for
federal income tax purposes and the right of the beneficiary to receive a
death benefit.

ERISA. Employers and employer-created trusts may be subject to
reporting, disclosure and fiduciary obligations under the Employee Retirement
Income Security Act of 1974. You should consult a qualified legal adviser.

OUR TAXES. The operations of the Separate Account are reported in our
federal income tax return, but we currently pay no income tax on the Separate
Account's investment income and capital gains, because these items are, for
tax purposes, reflected in our variable life insurance policy reserves.
Therefore, no charge is currently being made to any Variable Fund Account of
the Separate Account for taxes. We reserve the right to make a charge in the
future for taxes incurred. For example, we may make a charge to the Separate
Account for income taxes that we incur and that are allocable to the Policies.

We may have to pay state, local or other taxes in addition to applicable
taxes based on premiums. At present, these taxes are not substantial. If they
increase, charges may be made for such taxes when they are attributable to our
Separate Account or allocable to the Policies.

Certain Mutual Funds in which your cash value is invested may elect to
pass through to USAA Life taxes withheld by foreign taxing jurisdictions on
foreign source income. Such an election will result in additional taxable
income and income tax to USAA Life. The amount of additional income tax,
however, may be more than offset by credits for the foreign taxes withheld
which are also passed through. These credits may provide a benefit to USAA
Life.

WHEN WE WITHHOLD INCOME TAXES. Generally, unless you provide us with an
election to the contrary before we make the distribution, we are required to
withhold income tax from any proceeds we distribute as part of a taxable
transaction under your Policy. In some cases, where generation skipping taxes
may apply, we may also be required to withhold for such taxes unless we are
provided satisfactory written notification that no such taxes are due.

TAX CHANGES. The U.S. Congress frequently considers legislation that, if
enacted, could change the tax treatment of life insurance policies. In
addition, the Treasury Department may amend existing regulations, issue
regulations on the qualification of life insurance and modified endowment
contracts, or adopt new interpretations of existing law. State and local tax
law or, if you are not a U.S. citizen and resident, foreign tax law, may also
affect the tax consequences to you, the Insured, or your beneficiary, and are
subject to change. Any changes in federal, state, local or foreign tax law or
interpretation could have a retroactive effect. We suggest you consult a
qualified tax adviser.

TAXATION OF USAA LIFE

USAA Life is taxed as a life insurance company under federal income tax
laws. USAA Life does not initially expect to incur any income tax on the
earnings or the realized capital gains attributable to the Separate Account.
If, in the future, USAA Life determines that the Separate Account may incur
federal income taxes, then it may assess a charge against the Separate Account
Variable Fund Accounts for those taxes. Any charge will reduce the Policy's
cash value.

STATE REGULATION OF USAA LIFE

USAA Life, a stock life insurance company organized under the laws of
Texas, is subject to regulation by the Texas Department of Insurance. An
annual statement is filed with the Texas Department of Insurance on or before
March 1st of each year covering the operations and reporting on the financial
condition of USAA Life as of December 31 of the preceding year. Periodically,
the Commissioner of Insurance examines the liabilities and reserves of USAA
Life and the Separate Account and certifies their adequacy.

In addition, USAA Life is subject to the insurance laws and regulations
of all other states and jurisdictions where it is licensed. Generally, the
Insurance Department of any other state applies the laws of the state of Texas
in determining USAA Life's permissible investments.

LEGAL MATTERS

Freedman, Levy, Kroll, and Simonds, Washington, D.C., has advised USAA
Life on certain federal securities law matters. All matters of Texas law
pertaining to the Policy, including the validity of the Policy and USAA Life's
right to issue the Policy under Texas insurance law, have been passed upon by
Dwain A. Akins, Assistant Vice President and Assistant Secretary of USAA Life.

USAA Life is not involved in any legal proceedings that may involve the
assets of the Separate Account nor are we involved in any legal proceedings of
a material nature involving our own assets.

EXPERTS

The consolidated financial statements of USAA Life Insurance Company and
Consolidated Subsidiaries as of and for the year ended December 31, 1997 have
been included in the Prospectus in reliance upon the reports of KPMG Peat
Marwick, independent certified public accountants, appearing elsewhere herein,
and upon the authority of said firm as experts In accounting and auditing.

REGISTRATION STATEMENT

USAA Life has filed a registration statement under the Securities Act
of 1933 with the SEC relating to the offering described in this Prospectus.
This Prospectus does not contain all the information set forth in the
registration statement and amendments thereto and the exhibits filed as part
thereof, to all of which reference is hereby made for additional information
concerning the Separate Account, USAA Life and the Policies. The additional
information may be obtained at the SEC's main office in Washington, D.C., upon
payment of the prescribed fees.

FINANCIAL STATEMENTS

You should consider the consolidated financial statements of USAA
Life only as bearing on the ability of USAA Life to meet its contractual
obligations under the Policies. They do not bear on the investment performance
of the Separate Account. This Prospectus contains no financial statements for
the Separate Account, which commenced operations as of the date of this
Prospectus.

DEFINITIONS

IN THIS PROSPECTUS:

ACCUMULATION UNIT or UNIT means an accounting unit of measure that we use to
calculate values in each Variable Fund Account.

ANNIVERSARY means the same date each succeeding year as the Effective Date of
the Policy.

ANNUAL TARGET PREMIUM PAYMENT means an annual amount of premium payment that
we establish when we issue your Policy and that is shown on the Policy
Information Page. We use it to determine whether a premium charge will be
deducted from premium payments, whether a surrender charge is imposed on a
full surrender, and whether the Guaranteed Death Benefit applies.

BENEFICIARY means the person or entity designated to receive the death benefit
upon the Insured's death.

CASH SURRENDER VALUE means your Policy cash value less the surrender charge,
if any, payable on full surrender of your Policy.

CASH VALUE means the sum of your Policy's cash values invested in the Variable
Fund Accounts plus, if applicable, any cash value transferred from the
Separate Account to USAA Life's general account to secure any Policy loan,
plus any interest earnings credited to the loan account value, less the amount
of any outstanding loan and any unpaid loan interest, and less any Monthly
Deductions, transfer charges, and partial surrender charges applied through
that date.

DATE OF RECEIPT means the date actually received at our Home Office, subject
to two exceptions: (1) if received on a date other than a Valuation Date, the
Date of Receipt will be the following Valuation Date; and (2) if received on a
Valuation Date after close of regular trading of the New York Stock Exchange,
the Date of Receipt will be the following Valuation Date.

DEATH BENEFIT means the benefit paid in accordance with the death benefit
option in effect on the Insured's death, reduced by any Indebtedness and any
due and unpaid Monthly Deductions, and increased by any optional insurance
benefits provided by rider.

DEATH BENEFIT OPTION means one of the two death benefit options that the
Policy provides, namely, Option A and Option B. Option A is the greater of the
current Specified Amount or the Minimum Amount Insured. Option B is the
greater of the current Specified Amount, plus the Policy's cash value, or the
Minimum Amount Insured.

EFFECTIVE DATE means the date we approve the application and issue your Policy
or the date we approve any increase in Specified Amount under your Policy. The
Effective Date is shown on the Policy Information Page.

FREE LOOK PERIOD means the period of time required by state law during which
you may return the Policy for cancellation and receive a refund. If you
request cancellation of the Policy during the Free Look Period, we will refund
the greater of the premium payments your have paid or the value of the
Variable Fund Accounts as of the Date of Receipt of your request to cancel
plus any premium charge, Monthly Deduction and mortality and expense charge
that we have deducted. The Free Look Period is shown on the Policy Information
Page.

FUND means an investment portfolio that has specific investment objectives and
policies and is offered by a Mutual Fund.

GUARANTEED DEATH BENEFIT means that we guarantee your Policy will not lapse
during the first five Policy Years and that we will pay a Death Benefit if you
have paid a sufficient amount of premium.

HOME OFFICE means USAA Life Insurance Company, USAA Building, 9800
Fredericksburg Road, San Antonio, Texas 78288.

INDEBTEDNESS means the sum of all unpaid Policy loans and unpaid accrued
interest due on such loans.

INSURED means the person whose life is insured. The Insured may or may not be
the Owner.

LAPSE means your Policy has terminated because of insufficient cash value from
which to deduct the Monthly Deduction and any loan interest then due. No
insurance coverage exists when your Policy has lapsed.

MATURITY DATE means the date that we will pay your Policy's cash value to you,
as long as the Policy has not terminated because of lapse, full surrender, or
the Insured's death. The Maturity Date is shown on the Policy Information
Page.

MONTHLY ANNIVERSARY means the same date of each succeeding month as the
Effective Date of your Policy.

MONTHLY DEDUCTION means a charge we make under your Policy each month against
the Policy's cash value. The charge is equal to:

1) the cost of insurance and any riders, plus
2) the administrative charge that is applied during the first 12
months that the Policy is in effect, plus
3) the maintenance charge.

MINIMUM AMOUNT INSURED means the amount of life insurance required by the
Internal Revenue Code to qualify your Policy as life insurance and to exclude
the Death Benefit from a Beneficiary's taxable income.

MUTUAL FUND means an open-end investment company under federal securities law.
It may offer shares of several different Funds for investment.

NET ASSET VALUE means the current value of each Fund's total assets, less all
liabilities, divided by the total number of shares outstanding.

NET PREMIUM PAYMENT means the amount of a premium payment less the Policy's
premium charge.

NOTICE TO US means your signed statement that we receive at our Home Office
and that is in a form satisfactory to us.

OWNER means the person to whom we owe the rights and privileges of the Policy.

POLICY INFORMATION PAGE means the page that identifies certain information
about the Policy and specifies certain terms of the Policy.

POLICY YEAR means a period of 12 calendar months starting with the Effective
Date of the Policy, and each 12-month period thereafter. For example, if your
Policy was issued on July 15, your first Policy Year would end on the
following July 14. Each subsequent Policy Year would start on July 15 and end
on July 14.

SEPARATE ACCOUNT means the Life Insurance Account of USAA Life Insurance
Company. The Separate Account is an investment account established under Texas
law through which we invest the Net Premium Payments received for investment
in the Variable Fund Accounts under the Policy. The Separate Account is
divided into subdivisions called the Variable Fund Accounts. Each Variable
Fund Account invests the Net Premium Payments allocated to it in a particular
Fund. We own the assets of the Separate Account. To the extent that the assets
are equal to the reserves and other contractual liabilities, they are not
chargeable with liabilities arising out of any other business of ours. The
income, gains, and losses, realized or unrealized, from the assets of the
Separate Account are credited or charged against the Separate Account without
regard to other income, gains or losses of ours.

SPECIFIED AMOUNT means the minimum death benefit payable as long as the Policy
is in effect. It is also the amount of life insurance we issue. It is shown on
the Policy Information Page.

SURRENDER CHARGE means an amount that we may deduct from your Policy's cash
value if you surrender your Policy in full.

VALUATION DATE means any business day, Monday through Friday, on which the New
York Stock Exchange is open for regular trading, except

1) any day on which the value of the shares of a Fund is not
computed, or
2) any day during which no order for the purchase, surrender or
transfer of Accumulation Units is received.

VALUATION PERIOD means the period of time from the end of any Valuation Date
to the end of the next Valuation Date.

VARIABLE FUND ACCOUNT means a subdivision of the Separate Account in which you
may invest Net Premium Payments. There are several Variable Fund Accounts
under the Policy. Each Variable Fund Account corresponds to a particular Fund.
Net Premium Payments allocated to a Variable Fund Account are invested in a
particular Fund. The Variable Fund Accounts are also referred to in this
Prospectus as Accounts.

WE, OUR, US, or USAA Life means USAA Life Insurance Company.

YOU, YOUR or YOURS refers to the Owner of the Policy.

We have not authorized anyone to give any information or make any
representations other than those contained in this Prospectus (or any sales
literature we approve) in connection with the offer of the Policies described
herein. You may not rely on any such information or representations, if made.
This Prospectus does not constitute an offer in any jurisdiction to any person
to whom such offer would be unlawful. This Prospectus is valid only when
accompanied or preceded by the current prospectuses for the Funds described
herein.

[BACK COVER PAGE]

PART II

INFORMATION NOT REQUIRED TO BE FILED IN A PROSPECTUS

UNDERTAKING TO FILE REPORTS

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

UNDERTAKING PURSUANT TO RULE 484(b)(1)
UNDER THE SECURITIES ACT OF 1933

Rule 484(b)(1) under the Securities Act of 1933 requires a description
of "[a]ny provision or arrangement . . . whereby the registrant may indemnify
a director, officer or controlling person of the registrant against
liabilities arising under the [Securities] Act." Registrant, The Life
Insurance Separate Account of USAA Life Insurance Company, does not, as a
technical matter, have any directors or officers. Nevertheless, Registrant,
pursuant to Section 13 of the Amended and Restated Distribution and
Administration Agreement, may indemnify, albeit indirectly, directors and/or
officers of its depositor, USAA Life Insurance Company ("USAA Life"), as
follows. Section 13 of such Agreement provides that Registrant shall indemnify
the employees of USAA Investment Management Company ("IMCO"), Registrant's
principal underwriter. To whatever extent any director or officer of USAA Life
may be deemed to be an "employee" of IMCO, Registrant may be deemed to be
permitted to indemnify such person pursuant to such Agreement, which is filed
as Exhibit 1.(3)(a) to this Registration Statement and is herein incorporated
by reference.

Additionally, there are certain other provisions or arrangements whereby
USAA Life, and/or certain of its affiliated persons, may be indemnified by
parties or entities other than Registrant. Such provisions or arrangements are
incorporated herein by reference, as follows: to Article IX of the By-Laws of
USAA Life, filed as Exhibit 1.6(b) to this Registration Statement; to Section
9 of the Amended and Restated Underwriting and Administrative Services
Agreement, filed as Exhibit 1.(8)(a) to this Registration Statement; to
Section 12 of the Transfer Agent Agreement, as amended, filed as Exhibit
1.(8)(c) to this Registration Statement; to Section 6(b) of the Reimbursement
Agreement, filed as Exhibit 1.8(d)(iii) to this Registration Statement; to
Section 12.2 of the Amended Participation Agreement, filed as Exhibit
1.8(e)(i) to this Registration Statement; to Section 7 of the Participation
Agreement, filed as Exhibit 1.8(f)(i) to this Registration Statement; and to
the Expense Allocation Agreement, filed as Exhibit 1.8(f)(ii) to this
Registration Statement.

Insofar as indemnification for liability arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the Registrant pursuant to the foregoing provisions, or otherwise, the
Registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the
Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by a director, officer or controlling
person of the Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the Registrant will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the Act
and will be governed by the final adjudication of such issue.

REPRESENTATION REGARDING THE REASONABLENESS OF AGGREGATE FEES AND CHARGES
DEDUCTED UNDER THE POLICIES PURSUANT TO SECTION 26(e)(2)(A) OF THE INVESTMENT
COMPANY ACT OF 1940

USAA Life Insurance Company ("USAA Life") represents that the fees and
charges deducted under the Policies, in the aggregate, are reasonable in
relation to the services rendered, the expenses expected to be incurred, and
the risks assumed by the Company under the Policies. USAA Life bases its
representation on its assessment of all of the facts and circumstances,
including such relevant factors, as: the nature and extent of such services,
expenses and risks; the need for USAA Life to earn a profit; the degree to
which the Policies include innovative features; and the regulatory standards
for exemptive relief under the Investment Company Act of 1940 used prior to
October 1996, including the range of industry practice. This representation
applies to all Policies sold pursuant to this Registration Statement,
including those sold on the terms specifically described in the prospectus
contained herein, or any variations therein, based on supplements,
endorsements, or riders to any Policies or prospectus, or otherwise.

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CONTENTS OF REGISTRATION STATEMENT

This Registration Statement contains the following papers and documents:

The facing sheet.

Reconciliation and tie between items in Form N-8B-2 and the Prospectus.

Prospectus consisting of 53 pages.

Undertaking, pursuant to Section 15(d) of the Securities Exchange Act of 1934
to file reports.

Undertaking pursuant to Rule 484(b)(1) under the Securities Act of 1933,
regarding indemnification.

Representation regarding the reasonableness of aggregate fees and charges.

The signatures.

Written consents of the following persons:

Dwain A. Akins, Esq., Assistant Vice President and Assistant Secretary,
USAA Life Insurance Company (see Exhibit 2). (To be filed by
pre-effective amendment.)

KMPG Peat Marwick LLP, Independent Auditors (see Exhibit 6). (To be
filed by pre-effective amendment.)

The following exhibits:

1. Exhibits required by Article IX, paragraph A, of Form N-8B-2:

(1) Resolution of Board of Directors of USAA Life
Insurance Company establishing Life Insurance Separate
Account of USAA Life Insurance Company. (The
resolution is filed in lieu of a trust or indenture
creating a unit investment trust.) (Filed herewith.)

(2) Not applicable.

(3)(a) Amended and Restated Distribution and Administration
Agreement by and between USAA Life Insurance Company
and USAA Investment Management Company, dated December
16, 1994 and amended February 7, 1997, and amended and
restated, to encompass variable universal life
insurance, February 18, 1998. (1)

S-3

(3)(b) Not applicable.

(3)(c) Not applicable.

(4) Not applicable.

(5) Form of Variable Universal Life Insurance Policy
(Policy Form No. 31747), including riders. (Filed
herewith.)

(6)(a) Articles of Incorporation of USAA Life Insurance
Company, as amended. (1)

(6)(b) Bylaws of USAA Life Insurance Company. (1)

(7) Not applicable.

(8)(a) Amended and Restated Underwriting and Administrative
Services Agreement by and between USAA Life Insurance
Company, USAA Life Investment Trust and USAA
Investment Management Company, dated December 16,
1994, amended February 7, 1997, and amended and
restated, to encompass variable universal life
insurance, February 18, 1998. (2)

(8)(b)(i) Investment Advisory Agreement by and between USAA Life
Investment Trust and USAA Investment Management
Company, dated December 16, 1994. (2)

(8)(b)(ii) Amendment to Investment Advisory Agreement by and
between USAA Life Investment Trust and USAA Investment
Management Company, with respect to Funds added to
Trust, dated February 7, 1997. (3)

(8)(b)(iii) Second Amendment to Investment Advisory Agreement by
and between USAA Life Investment Trust and USAA
Investment Management Company, to encompass variable
life insurance, dated February 18, 1998. (2)

(8)(c)(i) Transfer Agent Agreement by and between USAA Life
Investment Trust and USAA Life Insurance Company,
dated December 15, 1994. (2)

(8)(c)(ii) Letter Agreement by and between USAA Life Investment
Trust and USAA Life Insurance Company, appointing USAA
Life as the Transfer Agent and Dividend Disbursing
Agent for Funds added to Trust, dated February 7,
1997. (3)

S-4

(8)(c)(iii) Amendment to Transfer Agent Agreement by and between
USAA Life Investment Trust and USAA Life Insurance
Company, to encompass variable universal life
insurance, dated February 18, 1998. (2)

(8)(d)(i) Amended Participation Agreement by and between Scudder
Variable Life Investment Fund and USAA Life Insurance
Company, dated February 3, 1995, as amended ________,
1998. (1)

(8)(d)(ii) Amended Participating Contract and Policy Agreement by
and between Scudder Investor Services, Inc. and USAA
Investment Management Company, dated February 3, 1995,
as amended ________, 1998. (1)

(8)(d)(iii) Reimbursement Agreement by and between Scudder,
Stevens & Clark, Inc. and USAA life Insurance Company,
dated February 3, 1995. (1)

(8)(d)(iv) Amended Letter Agreement by and between Scudder,
Stevens & Clark, Inc., Scudder Investor Services,
Inc., Scudder Variable Life Investment Fund, USAA Life
Insurance Company and USAA Investment Management
Company, dated February 3, 1995, as amended _____,
1998. (1)

(8)(e)(i) Amended Participation Agreement by and between The
Alger American Fund, Fred Alger Management, Inc., Fred
Alger & Company, Incorporated, and USAA Life Insurance
Company, dated December 16, 1994, as amended
___________, 1998. (1)

(8)(e)(ii) Amended Expense Allocation Agreement by and between
Fred Alger Management, Inc., Fred Alger & Company,
Incorporated, and USAA Life Insurance Company, dated
December 16, 1994 as amended ________, 1998. (1)

(8)(f)(i) Participation Agreement by and between BT Insurance
Funds Trust, Bankers Trust Company and USAA Life
Insurance Company, dated ________, 1998. (1)

(8)(f)(ii) Expense Allocation Agreement by and between Bankers
Trust Company and USAA Life Insurance Company, dated
________, 1998. (1)

(10)(a) Form of Application for the Variable Universal Life
Insurance Policy filed as Exhibit 1.(5). (Filed
herewith.)

(10)(b) Proposed Section 1035 Exchange Form. (To be filed by
pre-effective amendment.)

S-5

Other Exhibits

2 Opinion and Consent of Dwain A. Akins, Esq. Assistant
Vice President and Assistant Secretary, USAA Life
Insurance Company, as to the legality of the Policy
interests being registered. (To be filed by
pre-effective amendment.)

3 Not applicable.

4 Not applicable.

5 Financial Data Schedule. (See Exhibit 27 below.)

6 Consent of KPMG Peat Marwick LLP, Independent
Auditors. (To be filed by pre-effective amendment.)

7 Powers of Attorney for: Edwin L. Rosane, Robert G.
Davis, Bradford W. Rich, Josue Robles, Jr., Michael
J.C. Roth, Janis E. Marshall, William B. Tracy, Donald
R. Walker, and James A. Robinson.

8 Description of USAA Life Insurance Company Transfer
and Redemption Procedures for Variable Universal Life
Insurance Policy, pursuant to Rule 6e-3(T)(b)(12)(iii)
under the Investment Company Act of 1940. (To be filed
by pre-effective amendment.)

27 Financial Data Schedule. (Inapplicable, because,
notwithstanding Instruction 5 as to Exhibits, the
Commission staff has advised that no such Schedule is
required.)

<FN>
(1) Incorporated herein by reference to Post-Effective Amendment No.
4, filed on March ___, 1998, to the Form N-4 Registration
Statement (File No. 33-82268) of Separate Account of USAA Life
Insurance Company.

(2) Incorporated herein by reference to Post-Effective Amendment No.
6, filed on March ___, 1998, to the Form N-1A Registration
Statement (File No. 33-82270) of USAA Life Investment Trust.

(3) Incorporated herein by reference to Post-Effective Amendment No.
3, filed on February 14, 1997, to Form N-1A Registration Statement
(File No. 33-82270) of USAA Life Investment Trust.
</FN>

S-6

SIGNATURE

Pursuant to the requirements of the Securities Act of 1933, the
Registrant, Life Insurance Separate Account of USAA Life Insurance Company,
has duly caused this registration statement to be signed on its behalf by the
undersigned thereunto duly authorized, and its seal to be hereunto fixed and
attested, all in the City of San Antonio, and State of Texas, on this 30th day
of January, 1998.

Signature: Life Insurance Separate Account of USAA
Life Insurance Company (Registrant)

By: USAA Life Insurance Company
(On behalf of Registrant and itself)

By: /s/ EDWIN L. ROSANE
-------------------
EDWIN L. ROSANE
Vice Chairman, Chief Executive Officer
and President

Attest: /s/ DWAIN A. AKINS
------------------
DWAIN A. AKINS
Assistant Vice President and
Assistant Secretary

S-7

SIGNATURE