UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended
December 31, 2009

Commission File Nos. 33-34562;
33-60288; 333-48983; 333-133224

ML LIFE INSURANCE COMPANY OF NEW YORK
(Exact name of Registrant as specified in its charter)

|                                                               |  |                                     
|-------------------------------------------------------------- |  | ------------------------------------
|New York                                                       |  | 16-1020455                          
|                                                               |  |                                     
|(State or other jurisdiction of
incorporation or organization) |  | (I.R.S. Employer Identification No.)

|                                                
|------------------------------------------------
|4 Manhattanville RoadPurchase, New York 10577   
|                                                
|(Address of Principal Executive Offices)        
|1-800-333-6524                                  
|                                                
|(Registrants telephone no. including area code)

Securities registered pursuant to Section 12(b) or 12(g) of the Act: None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of
the Securities Act. [ ] Yes
[X] No

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or
15(d) of the Act. [ ] Yes
[X] No

Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. [X] Yes  [  ]  No

Indicate by check mark whether the registrant has submitted electronically and posted on its
corporate Web site, if any, every Interactive Data File required to be submitted and posted
pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months
(or for such shorter period that the registrant was required to submit and post such files). [  ]
Yes [  ] No

Indicate by check mark if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K is not contained herein, and will not be contained,
to the best of registrants knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. [ X ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer,
a non-accelerated filer, or a smaller reporting company.  See the
definitions of large accelerated filer, accelerated filer and smaller reporting company in Rule 12b-2 of the Exchange Act.

[ ]  large accelerated filer
     [ ]  accelerated filer
     [X] non-accelerated filer
     [ ] smaller reporting company


Indicated by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the
Act). [ ] Yes
[X] No

State the aggregate market value of the voting and non-voting
common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, or the average
bid and asked price of such common equity, as of the last business day of the registrants  most recently completed second
fiscal quarter: Not applicable.

Indicate the number of shares outstanding of each of the registrants
classes of common stock, as of the latest practicable date.

Common 220,000

REGISTRANT MEETS THE CONDITIONS SET FORTH IN GENERAL INSTRUCTION I(1)(a)
AND (b) OF FORM 10-K AND IS THEREFORE FILING THIS FORM WITH THE REDUCED
DISCLOSURE FORMAT.





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##### 



PART I
 
 Item 1. Business
      Our Insurance
Companies
 
 Item 1A. Risk Factors
 Risk Factors that Could Affect Merrill Lynch Life Insurance Company
  Economic Environment
 Adverse capital and credit market conditions may significantly affect our ability to meet liquidity
needs and cost of capital, as well as our access to capital
   1




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##### 



Our operating environment remains challenging in light of uncertainty about the timing and strength
of an economic recovery and the impact of governmental budgetary and regulatory initiatives. The
steps we have taken to realign our business and strengthen our capital position may not be adequate
to mitigate the financial and other risks associated with our operating environment, particularly
if economic conditions deteriorate from their current levels or regulatory requirements change
significantly, and we may be required to or we may seek to raise additional capital or take other
strategic or financial actions which could materially affect our results of operations, financial
condition and liquidity
      2




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##### 



Competitive Environment
 Competitive factors may adversely affect financial results
  Regulatory and Legislative Risks
 The insurance industry is heavily regulated and changes in regulation may adversely affect our results of operations
    Potential changes in federal or state tax laws, including changes impacting the availability of the
Separate Accounts dividend received deduction, may adversely affect our business, results of
operations, and financial condition
   Market Risk
 Changes in equity markets and other factors may significantly affect our financial results
   3




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##### 



Changes in equity markets and interest rates affects the profitability of our products with
guaranteed benefits, therefore, such changes may have a material adverse effect on our financial
results
     Credit Risk
 Defaults in our bond portfolio may adversely affect profitability and shareholders equity
  Interest Rate Risk
 Changes in market interest rates may adversely affect our financial results
   4




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##### 



Liquidity Risk
 Business and financial results may be adversely affected by an inability to sell assets to meet maturing obligations
  Underwriting Risk
 Differences between actual claims experience and underwriting and reserving assumptions may require
liabilities to be increased, which may have a material adverse effect on our financial results
  Other Risks
 A pandemic, terrorist attack or other catastrophic event may adversely affect our results of
operations and liquidity
  A computer system failure or security breach may disrupt our business, damage our reputation and adversely affect our results of operations, financial condition and cash flows
   5




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##### 



Litigation and regulatory investigations may adversely affect our business, results of operations, and financial condition
  The Companys election to discontinue new sales at the present time creates a risk that the growth
of future revenues may be limited and uncertain. Growth in revenues would thus be dependent on the
market performance of the assets underlying the policies and the policy
and rider fees received on a potentially declining number of policies in force.
  Global climate changes may have an adverse effect on our results of operations and financial condition
   Item 1B. Unresolved Staff Comments
  Item 2. Properties
    6




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##### 



Item 3. Legal Proceedings
  PART II
 Item 4. Market for Registrants Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
 (a)
    
    The Registrant is a wholly owned subsidiary of AUSA. There is no public trading market
for the Registrants common stock.
 During 2009, the Registrant did not receive a capital contribution from AUSA nor pay any
dividends to AUSA. During 2008, the Registrant paid a $7.0 million cash dividend to AUSA. No
other cash or stock dividends have been declared on Registrants common stock at any time during
the two most recent fiscal years. Under laws applicable to insurance companies domiciled in the
State of New York, notice of intention to declare a dividend must be filed with the New York
Superintendent of Insurance who may disallow the payment. See Note 9 to the Registrants
Financial Statements.
 (b)
    
    Not applicable.(c)
    
    Not applicable.
 Item 5. Selected Financial Data
  Item 6. Managements Narrative Analysis of Results of Operations
  Forward Looking Statements
  
    
    Changes in general economic conditions;
    
    Changes in the performance of financial markets, including emerging markets, such as with regard to:
 o
    
    The frequency and severity of defaults by issuers in our fixed income investment portfolios; ando
    
    The effects of corporate bankruptcies and/or accounting restatements on
the financial markets and the resulting decline in the value of equity and debt
securities we hold;
 
    
    The frequency and severity of insured loss events;
    
    Changes affecting mortality and other factors that may impact the profitability of our
insurance products;
    
    Changes affecting interest rate levels and continuing low or rapidly changing interest
rate levels;
    
    Increasing levels of competition;
    
    Changes in laws and regulations, particularly those affecting our operations, the
products we sell, and the attractiveness of certain products to our customers;
    
    Regulatory changes relating to the insurance industry in the jurisdictions in which we
operate;
    
    Lowering of one or more of the financial strength ratings and the adverse impact such
action may have on the premium writings, policy retention, profitability and liquidity;
    
    Acts of God, acts of terrorism, acts of war and pandemics;
    
    Changes in the policies of central banks and/or governments;
    
    Litigation or regulatory actions that could require us to pay significant damages or
change the way we do business;
    
    Customer responsiveness to both new products and distribution channels;
    
    Competitive, legal, regulatory or tax changes that affect the distribution cost of or
demand for our products; and
    
    Our failure to achieve anticipated levels of earnings or operational efficiencies as
well as other cost saving initiatives.
 7




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##### 



Business Overview
  Acquisition
   Purchase Price AllocationDecember 31,
    
    
    
    
    
    December 31(dollars in millions)
    
    2007
    
    Adjustments
    
    2008 (a)Value of business acquired, gross
    
    $
    44.0
    
    
    $
    6.8
    
    
    $
    50.8Goodwill
    
    
    6.9
    
    
    
    (3.3
    )
    
    
    3.6Other intangibles
    
    
    8.3
    
    
    
    (1.2
    )
    
    
    7.1Federal income taxes  current
    
    
    0.8
    
    
    
    (0.1
    )
    
    
    0.7Reinsurance receivable
    
    
    0.9
    
    
    
    
    
    
    
    0.9Other assets
    
    
    5.2
    
    
    
    0.1
    
    
    
    5.3Policyholder account balances
    
    
    140.8
    
    
    
    4.1
    
    
    
    144.9Future policy benefits
    
    
    22.8
    
    
    
    (3.6
    )
    
    
    19.2Federal income taxes  deferred
    
    
    
    
    
    
    1.8
    
    
    
    1.8
 
 (a)
    
    This reflects the December 31, 2008 balance before adjustments for unrealized
gains (losses) on investments, amortization and/or impairments.  Critical Accounting Policies and Estimates
  8




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##### 



Valuation of Fixed Maturity and Equity Securities
     Derivative Instruments
  Other-Than-Temporary Impairment (OTTI) Losses on Investments
    9




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##### 



Deferred Policy Acquisition Costs (DAC)
     Deferred Sales Inducements (DSI)
  10




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##### 



Value of Business Acquired (VOBA)
  Other Intangibles
  Goodwill
  Policyholder Account Balances
  Future Policy Benefits
  11




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##### 



December 31,(dollars in millions)
    
    2009
    
    2008GMDB liability
    
    $
    0.3
    
    
    $
    0.5GMIB liability
    
    
    2.5
    
    
    
    1.1
    December 31,(dollars in millions)
    
    2009
    
    2008GMWB liability
    
    $
    1.3
    
    
    $
    4.3GMIB reinsurance asset
    
    
    (5.7
    )
    
    
    (7.4
    )
 Federal Income Taxes
     12




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##### 



Recent Accounting Guidance
 TM
  Generally Accepted Accounting Principles
 TM
 InvestmentsDebt and Equity Securities
  Fair Value Measurements and Disclosures
 
    
    The Company adopted guidance on measuring the fair value of certain alternative
investments (i.e., investments in hedge funds, private equity funds, venture capital funds,
offshore fund vehicles, funds of funds, and real estate funds) as of the period ended
December 31, 2009 (ASU 2009-12, Investments in Certain Entities That Calculate Net Asset
Value per Share (or Its Equivalent)).
    
    The Company adopted guidance, as of the period ended December 31, 2009, which
clarified that when a quoted price in an active market for an identical liability is not
available, an entity should measure fair value using an approach that maximizes the use of
relevant observable inputs and minimizes the use of unobservable inputs (ASU 2009-05,
Measuring Liabilities at Fair Value).
    
    The Company adopted guidance for estimating fair value when the volume and
level of activity for an asset or liability have significantly decreased as well as
guidance on identifying circumstances that indicate a transaction is not orderly as of the
period ended June 30, 2009. This guidance was formerly known as FSP No. FAS 157-4,
Determining Fair Value When the Volume and Level of Activity for the Asset or Liability
Have Significantly Decreased and Identifying Transactions That Are Not Orderly and
supersedes guidance formerly known as FSP No. FAS 157-3, Determining the Fair Value of a
Financial Asset When the Market for That Asset Is Not Active.
    
    The Company adopted guidance requiring disclosures about fair value of
financial instruments in interim reporting periods as well as annual periods as of the
period ended June 30, 2009. This guidance was formerly known as FSP No. FAS 107-1 and
Accounting Principles Board Opinion No. 28-1, Interim Disclosures about Fair Value of
Financial Instruments.
    
    On January 1, 2008, the Company adopted guidance providing a fair value option
election that allows companies to irrevocably elect fair value as the initial and
subsequent measurement attribute for certain financial assets and liabilities, with changes
in fair value recognized in earnings as they occur. This guidance was formerly known as
SFAS No. 159, The Fair Value Option for Financial Assets and Financial Liabilities.
    
    On January 1, 2008, the Company adopted guidance that defines fair value,
establishes a framework for measuring fair value in accordance with GAAP and expands
disclosures about fair value measurements. This guidance was formerly known as SFAS No.
157, Fair Value Measurements.
 13




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##### 



, Subsequent Events
  InvestmentsOther; Beneficial Interests in Securitized Financial Assets
  Derivatives and Hedging
 
    
    On January 1, 2009, the Company adopted guidance that amends and expands the
disclosure requirements related to derivative instruments and hedging activities. This
guidance was formerly known as SFAS No. 161, Disclosures about Derivative Instruments and
Hedging Activities  an amendment of FASB Statement No. 133.
    
    The Company adopted guidance requiring disclosures by sellers of credit
derivatives, including credit derivatives embedded in hybrid instruments as of the period
ended December 31, 2008. This guidance was formerly known as FSP No. FAS 133-1 and FASB
Interpretation No. 45-4, Disclosures about Credit Derivatives and Certain Guarantees: An
Amendment of FASB Statement No. 133 and FASB Interpretation No. 45; and Clarification of
the Effective Date of FASB Statement No. 161.
 Business Combinations
  IntangiblesGoodwill and Other
   Fair Value Measurements and Disclosures
 Improving Disclosures about Fair Value Measurements
 New Business
  14




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##### 



Successor
    
    
    
    Predecessor(dollars in millions)
    
    2009
    
    
    2008
    
    
    
    2007Variable annuity deposits
    
    $
    2.8
    
    
    $
    9.8
    
    
    
    $
    36.6All other deposits
    
    
    0.1
    
    
    
    0.1
    
    
    
    
    0.1Total direct deposits
    
    $
    2.9
    
    
    $
    9.9
    
    
    
    $
    36.7
  Surrenders
  Financial Condition
  (dollars in millions)
    
    2009Investment performance
    
    $
    116.7Deposits
    
    
    2.9Policy fees and charges
    
    
    (13.0
    )Surrenders, benefits and withdrawals
    
    
    (60.9
    )Net change
    
    $
    45.7
  Investments
  15




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##### 



2009
    
    2008Fixed maturity securitiesInvestment grade fixed maturity securities
    
    
    48
    %
    
    
    51
    %Below investment grade fixed maturity securities
    
    
    2
    
    
    
    3Total fixed maturity securities
    
    
    50
    
    
    
    54Equity securities
    
    
    
    
    
    
    Cash and cash equivalents
    
    
    22
    
    
    
    14Policy loans
    
    
    28
    
    
    
    32100
    %
    
    
    100
    %
 Fixed Maturities and Equity Securities
   NetUnrealized
    
    
    Unrealized
    
    
    TotalOTTI
    
    
    Loss on
    
    
    Cumulativeon Available-
    
    
    Available-
    
    
    EffectFor-Sale
    
    
    For-Sale
    
    
    Adjustment(dollars in millions)
    
    Securities
    
    
    Securities
    
    
    in OCIIncrease in amortized cost of available-for-sale securities
    
    $
    0.1
    
    
    $
    0.1
    
    
    $
    0.2Change in VOBA
    
    
    
    
    
    
    (0.1
    )
    
    
    (0.1
    )Net cumulative effect adjustment
    
    $
    0.1
    
    
    $
    
    
    
    $
    0.1
  16




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##### 



December 31, 2009% ofAmortized
    
    
    Gross Unrealized
    
    
    
    
    
    
    Estimated
    
    
    Estimated(dollars in millions)
    
    Cost
    
    
    Gains
    
    
    Losses
    
    
    OTTI (1)
    
    
    Fair Value
    
    
    Fair ValueFixed maturity securitiesCorporate bondsFinancial services
    
    $
    12.9
    
    
    $
    0.5
    
    
    $
    (0.3
    )
    
    $
    
    
    
    $
    13.1
    
    
    
    11
    %Industrial
    
    
    46.0
    
    
    
    3.0
    
    
    
    
    
    
    
    
    
    
    
    49.0
    
    
    
    43Utility
    
    
    3.3
    
    
    
    0.2
    
    
    
    
    
    
    
    
    
    
    
    3.5
    
    
    
    3Asset-backed securitiesHousing related
    
    
    2.4
    
    
    
    
    
    
    
    (0.2
    )
    
    
    
    
    
    
    2.2
    
    
    
    2Credit cards
    
    
    2.8
    
    
    
    0.1
    
    
    
    
    
    
    
    
    
    
    
    2.9
    
    
    
    3Autos
    
    
    2.0
    
    
    
    0.1
    
    
    
    
    
    
    
    
    
    
    
    2.1
    
    
    
    2Commercial
mortgage-backed securities 
non agency backed
    
    
    25.8
    
    
    
    0.3
    
    
    
    (0.6
    )
    
    
    
    
    
    
    25.5
    
    
    
    22Residential mortgage-backed securitiesAgency backed
    
    
    7.9
    
    
    
    0.3
    
    
    
    
    
    
    
    
    
    
    
    8.2
    
    
    
    7Non agency backed
    
    
    1.1
    
    
    
    
    
    
    
    (0.2
    )
    
    
    
    
    
    
    0.9
    
    
    
    1Government and government agenciesUnited States
    
    
    3.2
    
    
    
    
    
    
    
    (0.1
    )
    
    
    
    
    
    
    3.1
    
    
    
    3Foreign
    
    
    3.5
    
    
    
    0.1
    
    
    
    (0.2
    )
    
    
    
    
    
    
    3.4
    
    
    
    3Total fixed maturity securities
    
    
    110.9
    
    
    
    4.6
    
    
    
    (1.6
    )
    
    
    
    
    
    
    113.9
    
    
    
    100Equity securities  banking securities
    
    
    0.1
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    0.1
    
    
    
    Total equity securities
    
    
    0.1
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    0.1
    
    
    
    Total fixed maturity and equity securities
    
    $
    111.0
    
    
    $
    4.6
    
    
    $
    (1.6
    )
    
    $
    
    
    
    $
    114.0
    
    
    
    100
    %
 
 (1)
    
    Subsequent unrealized gains (losses) on OTTI securities are included in OCI-OTTI. 17




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##### 



December 31, 2008% ofAmortized
    
    
    Gross Unrealized
    
    
    
    
    
    
    Estimated
    
    
    Estimated(dollars in millions)
    
    Cost
    
    
    Gains
    
    
    Losses
    
    
    OTTI
    
    
    Fair Value
    
    
    Fair ValueFixed maturity securitiesCorporate bondsFinancial services
    
    $
    17.4
    
    
    $
    
    
    
    $
    (2.1
    )
    
    $
    
    
    
    $
    15.3
    
    
    
    13
    %Industrial
    
    
    56.5
    
    
    
    0.6
    
    
    
    (4.4
    )
    
    
    
    
    
    
    52.7
    
    
    
    46Utility
    
    
    4.4
    
    
    
    
    
    
    
    (0.1
    )
    
    
    
    
    
    
    4.3
    
    
    
    4Asset-backed securitiesHousing related
    
    
    2.8
    
    
    
    
    
    
    
    (0.1
    )
    
    
    
    
    
    
    2.7
    
    
    
    2Credit cards
    
    
    2.7
    
    
    
    
    
    
    
    (0.5
    )
    
    
    
    
    
    
    2.2
    
    
    
    2Autos
    
    
    2.0
    
    
    
    
    
    
    
    (0.2
    )
    
    
    
    
    
    
    1.8
    
    
    
    2Commercial
mortgage-backed securities 
non agency backed
    
    
    24.8
    
    
    
    
    
    
    
    (5.0
    )
    
    
    
    
    
    
    19.8
    
    
    
    17Residential mortgage-backed securitiesAgency backed
    
    
    9.7
    
    
    
    0.2
    
    
    
    (0.1
    )
    
    
    
    
    
    
    9.8
    
    
    
    8Non agency backed
    
    
    1.4
    
    
    
    
    
    
    
    (0.5
    )
    
    
    
    
    
    
    0.9
    
    
    
    1Government and government agenciesUnited States
    
    
    2.2
    
    
    
    0.1
    
    
    
    
    
    
    
    
    
    
    
    2.3
    
    
    
    2Foreign
    
    
    4.0
    
    
    
    0.2
    
    
    
    (0.2
    )
    
    
    
    
    
    
    4.0
    
    
    
    3Total fixed maturity securities
    
    
    127.9
    
    
    
    1.1
    
    
    
    (13.2
    )
    
    
    
    
    
    
    115.8
    
    
    
    100Equity securitiesBanking securities
    
    
    0.1
    
    
    
    
    
    
    
    (0.1
    )
    
    
    
    
    
    
    
    
    
    
    Other financial services securities
    
    
    0.2
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    0.2
    
    
    
    Total equity securities
    
    
    0.3
    
    
    
    
    
    
    
    (0.1
    )
    
    
    
    
    
    
    0.2
    
    
    
    Total fixed maturity and equity securities
    
    $
    128.2
    
    
    $
    1.1
    
    
    $
    (13.3
    )
    
    $
    
    
    
    $
    116.0
    
    
    
    100
    %
   18




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##### 



Financial
Services Sectors
   Banking
 The overall exposure to the banking sub-sector in the Companys portfolio is of high quality.
The unrealized losses in the banking sub-sector primarily reflect low floating rate coupons on
some securities, and credit spread widening due to economic weakness and market concerns that
deeply subordinated securities will not be supported by the government. Government initiatives
put into place during 2008 and 2009 have been largely successful in reopening the funding
markets though lending remains cautious in some sectors of the economy. Many banks have
benefited from both direct assistance (government capital injections, asset relief plans and
government guarantees on debt) and indirect assistance (various government liquidity measures,
including short-term funding facilities). Included in the Companys banking exposure are hybrid
securities, which typically have an original maturity of more than thirty years, may be
perpetual, and were designed to receive enhanced equity credit from rating agencies. In
addition, they have other features that may not be consistent across issues such as a cumulative
or non-cumulative coupon, capital replacement language and an alternative payment mechanism.
The Companys exposure to hybrid securities in an unrealized loss is all rated investment grade
and there is little risk of payment interruption. The Company evaluated the near-term prospects
of the issuers in relation to the severity and duration of the unrealized loss and does not
consider those investments to be impaired as of December 31, 2009.
 There are no individual issuers rated below investment grade in this sub-sector which have an
unrealized loss position greater than $0.2 million.
 Asset-Backed Securities  Housing Related
    19




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##### 



Commercial Mortgage-Backed Securities
  2009NetEstimated
    
    
    UnrealizedAmortized
    
    
    Fair
    
    
    Gains (Losses)(dollars in millions)
    
    Cost
    
    
    Value
    
    
    and OTTIAAA  Senior
    
    $
    23.1
    
    
    $
    23.4
    
    
    $
    0.3AAA  Junior
    
    
    1.7
    
    
    
    1.4
    
    
    
    (0.3
    )A
    
    
    1.0
    
    
    
    0.7
    
    
    
    (0.3
    )Total
    
    $
    25.8
    
    
    $
    25.5
    
    
    $
    (0.3
    )
 2008NetEstimated
    
    
    UnrealizedAmortized
    
    
    Fair
    
    
    Gains (Losses)(dollars in millions)
    
    Cost
    
    
    Value
    
    
    and OTTIAAA  Senior
    
    $
    22.2
    
    
    $
    18.6
    
    
    $
    (3.6
    )AAA  Mezzanine
    
    
    0.9
    
    
    
    0.5
    
    
    
    (0.4
    )AAA  Junior
    
    
    1.7
    
    
    
    0.7
    
    
    
    (1.0
    )Total
    
    $
    24.8
    
    
    $
    19.8
    
    
    $
    (5.0
    )
 2009Estimated Fair Value by Vintage(dollars in millions)
    
    2005&Prior
    
    
    2006
    
    
    2007
    
    
    2008
    
    
    2009
    
    
    TotalAAA  Senior (a)
    
    $
    4.2
    
    
    $
    19.2
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    23.4AAA  Junior
    
    
    0.7
    
    
    
    0.7
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1.4A
    
    
    
    
    
    
    0.7
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    0.7Total
    
    $
    4.9
    
    
    $
    20.6
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    25.5
 2008Estimated Fair Value by Vintage(dollars in millions)
    
    2004&Prior
    
    
    2005
    
    
    2006
    
    
    2007
    
    
    2008
    
    
    TotalAAA  Senior (a)
    
    $
    0.4
    
    
    $
    3.2
    
    
    $
    15.0
    
    
    $
    
    
    
    $
    
    
    
    $
    18.6AAA  Mezzanine
    
    
    
    
    
    
    
    
    
    
    0.5
    
    
    
    
    
    
    
    
    
    
    
    0.5AAA  Junior
    
    
    
    
    
    
    0.4
    
    
    
    0.3
    
    
    
    
    
    
    
    
    
    
    
    0.7Total
    
    $
    0.4
    
    
    $
    3.6
    
    
    $
    15.8
    
    
    $
    
    
    
    $
    
    
    
    $
    19.8
 
 (a)
    
    All 2004 & Prior AAAs are classified as AAA  Senior. This was prior to the market
convention of Credit Enhanced tiering within AAAs, which started in 2005.  20




---



##### 



Residential Mortgage-Backed Securities
       Government and Government Agencies
   21




---



##### 



December 31, 2009
    
    
    December 31, 2008Estimated
    
    
    
    
    
    
    EstimatedAmortized
    
    
    Fair
    
    
    Amortized
    
    
    Fair(dollars in millions)
    
    Cost
    
    
    Value
    
    
    Cost
    
    
    ValueAAA
    
    $
    40.2
    
    
    $
    40.4
    
    
    $
    46.2
    
    
    $
    40.7AA
    
    
    9.2
    
    
    
    9.5
    
    
    
    9.7
    
    
    
    9.4A
    
    
    35.6
    
    
    
    37.0
    
    
    
    35.0
    
    
    
    33.8BBB
    
    
    20.9
    
    
    
    22.1
    
    
    
    29.8
    
    
    
    26.5Below investment grade
    
    
    5.0
    
    
    
    4.9
    
    
    
    7.2
    
    
    
    5.4Total fixed maturity securities
    
    $
    110.9
    
    
    $
    113.9
    
    
    $
    127.9
    
    
    $
    115.8Investment grade
    
    
    95
    %
    
    
    96
    %
    
    
    94
    %
    
    
    95
    %Below investment grade
    
    
    5
    %
    
    
    4
    %
    
    
    6
    %
    
    
    5
    %
    December 31, 2009GrossEstimated
    
    
    
    
    
    
    UnrealizedFair
    
    
    Amortized
    
    
    Losses and(dollars in millions)
    
    Value
    
    
    Cost
    
    
    OTTI (1)Investment Grade SecuritiesLess than or equal to six monthsCorporate bonds  industrial
    
    $
    1.0
    
    
    $
    1.0
    
    
    $
    Government and government agenciesUnited States
    
    
    1.9
    
    
    
    1.9
    
    
    
    Foreign
    
    
    2.2
    
    
    
    2.3
    
    
    
    (0.1
    )Total fixed maturity and equity securities
    
    
    5.1
    
    
    
    5.2
    
    
    
    (0.1
    )Greater than six months but less than or equal to one yearCorporate bonds  industrial
    
    
    0.3
    
    
    
    0.3
    
    
    
    Asset-backed securities  housing related
    
    
    0.7
    
    
    
    0.7
    
    
    
    Government and government agencies  United States
    
    
    1.0
    
    
    
    1.1
    
    
    
    (0.1
    )Total fixed maturity and equity securities
    
    
    2.0
    
    
    
    2.1
    
    
    
    (0.1
    )Greater than one yearCorporate bonds  financial services
    
    
    3.8
    
    
    
    4.1
    
    
    
    (0.3
    )Asset-backed securities  housing related
    
    
    1.5
    
    
    
    1.7
    
    
    
    (0.2
    )Commercial mortgage-backed securities  non agency backed
    
    
    6.0
    
    
    
    6.6
    
    
    
    (0.6
    )Total fixed maturity and equity securities
    
    $
    11.3
    
    
    $
    12.4
    
    
    $
    (1.1
    )
 22




---



##### 



December 31, 2009GrossEstimated
    
    
    
    
    
    
    UnrealizedFair
    
    
    Amortized
    
    
    Losses and(dollars in millions)
    
    Value
    
    
    Cost
    
    
    OTTI (1)Investment Grade Securities (continued)Total of all investment grade securitiesCorporate bondsFinancial services
    
    $
    3.8
    
    
    $
    4.1
    
    
    $
    (0.3
    )Industrial
    
    
    1.3
    
    
    
    1.3
    
    
    
    Asset-backed securities  housing related
    
    
    2.2
    
    
    
    2.4
    
    
    
    (0.2
    )Commercial mortgage-backed securities  non agency backed
    
    
    6.0
    
    
    
    6.6
    
    
    
    (0.6
    )Government and government agenciesUnited States
    
    
    2.9
    
    
    
    3.0
    
    
    
    (0.1
    )Foreign
    
    
    2.2
    
    
    
    2.3
    
    
    
    (0.1
    )Total fixed maturity and equity securities
    
    $
    18.4
    
    
    $
    19.7
    
    
    $
    (1.3
    )Total number of securities in a continuous unrealized loss position
    
    
    
    
    
    
    
    
    
    
    25
 
 (1)
    
    Subsequent unrealized gains (losses) on OTTI securities are included in OCI-OTTI. December 31, 2008GrossEstimated
    
    
    
    
    
    
    UnrealizedFair
    
    
    Amortized
    
    
    Losses and(dollars in millions)
    
    Value
    
    
    Cost
    
    
    OTTIInvestment Grade SecuritiesLess than or equal to six monthsCorporate bondsFinancial services
    
    $
    5.9
    
    
    $
    6.4
    
    
    $
    (0.5
    )Industrial
    
    
    20.5
    
    
    
    22.7
    
    
    
    (2.2
    )Utility
    
    
    1.2
    
    
    
    1.2
    
    
    
    Asset-backed securitiesHousing related
    
    
    2.1
    
    
    
    2.2
    
    
    
    (0.1
    )Credit cards
    
    
    2.2
    
    
    
    2.7
    
    
    
    (0.5
    )Autos
    
    
    1.8
    
    
    
    2.0
    
    
    
    (0.2
    )Commercial mortgage-backed securities  non agency backed
    
    
    18.9
    
    
    
    22.9
    
    
    
    (4.0
    )Residential mortgage-backed securities  agency backed
    
    
    1.5
    
    
    
    1.6
    
    
    
    (0.1
    )Government and government agencies  foreign
    
    
    0.3
    
    
    
    0.3
    
    
    
    Equity securities  banking securities
    
    
    
    
    
    
    0.1
    
    
    
    (0.1
    )Total fixed maturity and equity securities
    
    
    54.4
    
    
    
    62.1
    
    
    
    (7.7
    )Greater than six months but less than or equal to one yearCorporate bondsFinancial services
    
    
    6.3
    
    
    
    8.1
    
    
    
    (1.8
    )Industrial
    
    
    7.0
    
    
    
    7.5
    
    
    
    (0.5
    )Utility
    
    
    1.6
    
    
    
    1.6
    
    
    
    Commercial mortgage-backed securities  non agency backed
    
    
    0.9
    
    
    
    1.9
    
    
    
    (1.0
    )Residential mortgage-backed securities  non agency backed
    
    
    0.9
    
    
    
    1.4
    
    
    
    (0.5
    )Total fixed maturity and equity securities
    
    $
    16.7
    
    
    $
    20.5
    
    
    $
    (3.8
    )
 23




---



##### 



December 31, 2008GrossEstimated
    
    
    
    
    
    
    UnrealizedFair
    
    
    Amortized
    
    
    Losses and(dollars in millions)
    
    Value
    
    
    Cost
    
    
    OTTIInvestment Grade Securities (continued)Total of all investment grade securitiesCorporate bondsFinancial services
    
    $
    12.2
    
    
    $
    14.5
    
    
    $
    (2.3
    )Industrial
    
    
    27.5
    
    
    
    30.2
    
    
    
    (2.7
    )Utility
    
    
    2.8
    
    
    
    2.8
    
    
    
    Asset-backed securitiesHousing related
    
    
    2.1
    
    
    
    2.2
    
    
    
    (0.1
    )Credit cards
    
    
    2.2
    
    
    
    2.7
    
    
    
    (0.5
    )Autos
    
    
    1.8
    
    
    
    2.0
    
    
    
    (0.2
    )Commercial mortgage-backed securities  non agency backed
    
    
    19.8
    
    
    
    24.8
    
    
    
    (5.0
    )Residential mortgage-backed securitiesAgency backed
    
    
    1.5
    
    
    
    1.6
    
    
    
    (0.1
    )Non agency backed
    
    
    0.9
    
    
    
    1.4
    
    
    
    (0.5
    )Government and government agencies  foreign
    
    
    0.3
    
    
    
    0.3
    
    
    
    Equity securities  banking securities
    
    
    
    
    
    
    0.1
    
    
    
    (0.1
    )Total fixed maturity and equity securities
    
    $
    71.1
    
    
    $
    82.6
    
    
    $
    (11.5
    )Total number of securities in a continuous unrealized loss position
    
    
    
    
    
    
    
    
    
    
    108
  December 31, 2009GrossEstimated
    
    
    
    
    
    
    UnrealizedFair
    
    
    Amortized
    
    
    Losses and(dollars in millions)
    
    Value
    
    
    Cost
    
    
    OTTI (1)Below Investment Grade SecuritiesGreater than one yearCorporate bonds  industrial
    
    $
    0.5
    
    
    $
    0.5
    
    
    $
    Residential mortgage-backed securities  non agency backed
    
    
    0.9
    
    
    
    1.1
    
    
    
    (0.2
    )Government and government agencies  foreign
    
    
    0.4
    
    
    
    0.5
    
    
    
    (0.1
    )Equity securities  banking securities
    
    
    0.1
    
    
    
    0.1
    
    
    
    Total fixed maturity and equity securities
    
    $
    1.9
    
    
    $
    2.2
    
    
    $
    (0.3
    )Total number of securities in a continuous unrealized loss position
    
    
    
    
    
    
    
    
    
    
    4
 
 (1)
    
    Subsequent unrealized gains (losses) on OTTI securities are included in OCI-OTTI. 24




---



##### 



December 31, 2008GrossEstimated
    
    
    
    
    
    
    UnrealizedFair
    
    
    Amortized
    
    
    Losses and(dollars in millions)
    
    Value
    
    
    Cost
    
    
    OTTIBelow Investment Grade SecuritiesLess than or equal to six monthsCorporate  industrial
    
    $
    4.0
    
    
    $
    5.1
    
    
    $
    (1.1
    )Government and government agencies  foreign
    
    
    0.7
    
    
    
    0.9
    
    
    
    (0.2
    )Total fixed maturity and equity securities
    
    
    4.7
    
    
    
    6.0
    
    
    
    (1.3
    )Greater than  six months but less than or equal to one yearCorporate  industrial
    
    
    0.1
    
    
    
    0.5
    
    
    
    (0.4
    )Equity securities  other financial services securities
    
    
    0.1
    
    
    
    0.2
    
    
    
    (0.1
    )Total fixed maturity and equity securities
    
    
    0.2
    
    
    
    0.7
    
    
    
    (0.5
    )Total of all below investment grade securitiesCorporate  industrial
    
    
    4.1
    
    
    
    5.6
    
    
    
    (1.5
    )Government and government agencies  foreign
    
    
    0.7
    
    
    
    0.9
    
    
    
    (0.2
    )Equity securities  other financial services securities
    
    
    0.1
    
    
    
    0.2
    
    
    
    (0.1
    )Total fixed maturity and equity securities
    
    $
    4.9
    
    
    $
    6.7
    
    
    $
    (1.8
    )Total number of securities in a continuous unrealized loss position
    
    
    
    
    
    
    
    
    
    
    18
   December 31, 2009Ratio of
    
    
    
    
    
    
    
    
    
    
    GrossAmortized Cost
    
    
    Estimated
    
    
    
    
    
    
    Unrealizedto Estimated
    
    
    Fair
    
    
    Amortized
    
    
    Losses and(dollars in millions)
    
    Fair Value
    
    
    Value
    
    
    Cost
    
    
    OTTIGreater than one year70% to 100%
    
    $
    1.9
    
    
    $
    2.2
    
    
    $
    (0.3
    )Total
    
    
    
    
    
    $
    1.9
    
    
    $
    2.2
    
    
    $
    (0.3
    )
 25




---



##### 



December 31, 2008Ratio of
    
    
    
    
    
    
    
    
    
    
    GrossAmortized Cost
    
    
    Estimated
    
    
    
    
    
    
    Unrealizedto Estimated
    
    
    Fair
    
    
    Amortized
    
    
    Losses and(dollars in millions)
    
    Fair Value
    
    
    Value
    
    
    Cost
    
    
    OTTILess than or equal to six months70% to 100%
    
    $
    3.6
    
    
    $
    4.1
    
    
    $
    (0.5
    )40% to 70%
    
    
    1.1
    
    
    
    1.9
    
    
    
    (0.8
    )4.7
    
    
    
    6.0
    
    
    
    (1.3
    )Greater than six months but less than or equal to one year70% to 100%
    
    
    0.2
    
    
    
    0.2
    
    
    
    Below 40%
    
    
    
    
    
    
    0.5
    
    
    
    (0.5
    )0.2
    
    
    
    0.7
    
    
    
    (0.5
    )Total
    
    
    
    
    
    $
    4.9
    
    
    $
    6.7
    
    
    $
    (1.8
    )
  Subprime Mortgage Investments
  OTTI
   Business Environment
  Equity Market Performance
  26




---



##### 



Medium Term Interest Rates, Corporate Credit and Credit Spreads
     2009
    
    
    2008Average medium term interest rate yield (a)
    
    
    1.43
    %
    
    
    0.89
    %Increase (decrease) in medium term interest rates (in basis points)
    
    
    54
    
    
    
    (249
    )Credit spreads (in basis points) (b)
    
    
    200
    
    
    
    735Expanding (contracting) of credit spreads (in basis points)
    
    
    (535
    )
    
    
    505Increase (decrease) on market valuations: (in millions)Available-for-sale investment securities
    
    $
    15.2
    
    
    $
    (12.2
    )Interest-sensitive policyholder liabilities
    
    
    0.3
    
    
    
    (0.1
    )Net change on market valuations
    
    $
    15.5
    
    
    $
    (12.3
    )
 
 (a)
    
    The Company defines medium term interest rates as the average interest rate on
U.S. Treasury securities with terms of one to five years.(b)
    
    The Company defines credit spreads according to the Merrill Lynch U.S. Corporate
Bond Index for BBB-A Rated bonds with three to five year maturities.  27




---



##### 



Liquidity and Capital Resources
 Liquidity
  Capital Resources
   Statutory
Principles and Risk-Based Capital (RBC)
   Ratings
   
    
    S&P  AAA to R
    
    A.M. Best  A++ to S
    
    Moodys  Aaa to C
    
    Fitch  AAA to C
    S&P
    
    AA-
    
    (4th out of 21)A.M. Best
    
    A
    
    (3rd out of 16)Moodys
    
    A1
    
    (5th out of 21)Fitch
    
    AA
    
    (3rd out of 19)
  28




---



##### 



Commitments and Contingencies
  Less
    
    
    One To
    
    
    Four To
    
    
    MoreThan One
    
    
    Three
    
    
    Five
    
    
    Than Five(dollars in millions) (a)
    
    Year
    
    
    Years
    
    
    Years
    
    
    Years
    
    
    TotalGeneral accounts
    
    $
    16.7
    
    
    $
    29.3
    
    
    $
    22.2
    
    
    $
    81.4
    
    
    $
    149.6Separate Accounts
    
    
    84.8
    
    
    
    160.3
    
    
    
    116.5
    
    
    
    406.6
    
    
    
    768.2$
    101.5
    
    
    $
    189.6
    
    
    $
    138.7
    
    
    $
    488.0
    
    
    $
    917.8
 
 (a)
    
    The policyholder liabilities include benefit and claim liabilities of which a
significant portion represents policies and contracts that do not have a stated
contractual maturity. The projected cash benefit payments in the table above are based
on managements best estimates of the expected gross benefits and expenses, partially
offset by the expected gross premiums, fees and charges relating to the existing
business in force. Estimated cash benefit payments are based on mortality and lapse
assumptions comparable with the Companys historical experience, modified for recently
observed trends. Actual payment obligations may differ if experience varies from these
assumptions. The cash benefit payments are presented on an undiscounted basis and are
before deduction of tax and before reinsurance. The liability amounts in the Companys
Financial Statements reflect the discounting for interest as well as adjustments for the
timing of other factors as described above. As a result, the sum of the cash benefit
payments shown for all years in the table above exceeds the corresponding policyholder
liability amounts.  Results of Operations
  
    
    the charges imposed on variable annuity and variable life insurance contracts, and
 
    
    the net earnings from investment of fixed rate life insurance and annuity contract owner
deposits less interest credited to contract owners, commonly known as interest spread
 Critical Accounting Policies
 2009 compared to 2008
  29




---



##### 



(dollars in millions)
    
    2009
    
    
    2008
    
    
    ChangeAsset-based policy charge revenue
    
    $
    8.8
    
    
    $
    11.6
    
    
    $
    (2.8
    ) (a)Guaranteed benefit based policy charge revenue
    
    
    1.4
    
    
    
    1.3
    
    
    
    0.1Non-asset based policy charge revenue
    
    
    4.6
    
    
    
    5.6
    
    
    
    (1.0
    ) (b)Total policy charge revenue
    
    $
    14.8
    
    
    $
    18.5
    
    
    $
    (3.7
    )
 
 (a)
    
    Asset-based policy charge revenue was negatively impacted by the decrease in
average variable account balances during late 2008 and early 2009.(b)
    
    The decrease in non-asset based policy charge revenue was primarily due to the
run-off of the life business as well as less paid up additions during 2009 as a result
of poor equity market performance in 2008.  (dollars in millions)
    
    2009
    
    
    2008
    
    
    ChangeCredit related gains (losses)
    
    $
    (0.6
    )
    
    $
    (0.5
    )
    
    $
    (0.1
    )Interest related gains (losses)
    
    
    (0.3
    )
    
    
    (0.1
    )
    
    
    (0.2
    )Equity related gains (losses)
    
    
    (2.0
    )
    
    
    1.3
    
    
    
    (3.3
    ) (a)Associated amortization of VOBA
    
    
    
    
    
    
    0.1
    
    
    
    (0.1
    )Total net realized investment gains (losses)
    
    $
    (2.9
    )
    
    $
    0.8
    
    
    $
    (3.7
    )Write-downs for OTTI included in net
realized investment gains (losses)
    
    $
    (0.9
    )
    
    $
    (0.6
    )
    
    $
    (0.3
    )
 
 (a)
    
    The change in equity related gains (losses) principally relates to net losses on
futures contracts during 2009 compared to net gains on futures contracts during 2008.  (dollars in millions)
    
    2009
    
    
    2008
    
    
    ChangeAnnuity benefit unlocking
    
    $
    0.1
    
    
    $
    2.3
    
    
    $
    (2.2
    ) (a)Annuity benefit expense
    
    
    1.7
    
    
    
    (1.3
    )
    
    
    3.0
    (b)Amortization of deferred sales inducements
    
    
    0.1
    
    
    
    
    
    
    
    0.1Life insurance mortality expense
    
    
    1.4
    
    
    
    1.6
    
    
    
    (0.2
    )Total policy benefits
    
    $
    3.3
    
    
    $
    2.6
    
    
    $
    0.7
 
 (a)
    
    See the Critical Accounting Policies and Estimatessection above for further
discussion of annuity benefit unlocking.(b)
    
    The increase in annuity benefit expense was primarily driven by the change in
reserve for the embedded derivatives as compared to the same period in 2008. This was
primarily a result of the positive equity markets relative to the same period in 2008.    30




---



##### 



(dollars in millions)
    
    2009
    
    
    2008
    
    
    ChangeCommissions
    
    $
    2.8
    
    
    $
    2.2
    
    
    $
    0.6
    (a)General insurance expense
    
    
    3.5
    
    
    
    2.8
    
    
    
    0.7
    (b)Taxes, licenses, and fees
    
    
    (0.3
    )
    
    
    0.5
    
    
    
    (0.8
    ) (c)Total
insurance expenses and taxes
    
    $
    6.0
    
    
    $
    5.5
    
    
    $
    0.5
 
 (a)
    
    The increase in commissions is primarily related to an increase in trail
commissions in 2009.(b)
    
    The increase in general insurance expenses is primarily due to increased
transition and system conversion related expenses.(c)
    
    The decrease in taxes, licenses and fees is primarily due to a tax refund related
to NY franchise taxes. 2008 compared to 2007
   Successor
    
    
    
    Predecessor(dollars in millions)
    
    2008
    
    
    
    2007
    
    
    ChangeAsset-based policy charge revenue
    
    $
    11.6
    
    
    
    $
    14.3
    
    
    $
    (2.7
    ) (a)Guaranteed benefit based policy charge revenue
    
    
    1.3
    
    
    
    
    1.2
    
    
    
    0.1Non-asset based policy charge revenue
    
    
    5.6
    
    
    
    
    5.3
    
    
    
    0.3Total policy
charge revenue
    
    $
    18.5
    
    
    
    $
    20.8
    
    
    $
    (2.3
    )
 
 (a)
    
    Asset-based policy charge revenue was negatively impacted by the decrease in
average variable account balances during 2008 as compared to 2007.  Successor
    
    
    
    Predecessor(dollars in millions)
    
    2008
    
    
    
    2007
    
    
    ChangeCredit related gains (losses)
    
    $
    (0.5
    )
    
    
    $
    1.1
    
    
    $
    (1.6
    ) (a)Interest related gains (losses)
    
    
    (0.1
    )
    
    
    
    
    
    
    
    (0.1
    )Equity related gains
    
    
    1.3
    
    
    
    
    
    
    
    
    1.3
    (b)Associated amortization of VOBA
    
    
    0.1
    
    
    
    
    
    
    
    
    0.1Total net realized investment gains
    
    $
    0.8
    
    
    
    $
    1.1
    
    
    $
    (0.3
    )Write-downs for OTTI included in net
realized investment gains (losses)
    
    $
    (0.6
    )
    
    
    $
    
    
    
    $
    (0.6
    )
 
 (a)
    
    The increase in credit related losses during 2008 were primarily due to one credit
impairment in the third quarter of 2008 and a large credit related gain in 2007.(b)
    
    The increase in equity related gains principally relates to net gains on futures
contracts in 2008 as there were no futures contracts in 2007. 31




---



##### 



Successor
    
    
    
    Predecessor(dollars in millions)
    
    2008
    
    
    
    2007
    
    
    ChangeAnnuity benefit unlocking
    
    $
    2.3
    
    
    
    $
    (1.2
    )
    
    $
    3.5
    (a)Annuity benefit expense
    
    
    (1.3
    )
    
    
    
    1.1
    
    
    
    (2.4
    ) (b)Life insurance mortality expense
    
    
    1.6
    
    
    
    
    2.2
    
    
    
    (0.6
    ) (c)Total policy
benefits
    
    $
    2.6
    
    
    
    $
    2.1
    
    
    $
    0.5
 
 (a)
    
    See the Critical Accounting Policies and Estimatessection above for further
discussion of annuity benefit unlocking.(b)
    
    The decrease in annuity benefit expense was primarily due to the decrease in the
guaranteed minimum benefit amounts as a result of volatile equity markets effect on
reinsurance reserves.(c)
    
    The decrease in life insurance mortality expense during 2008 was due to a lower
volume of claims in 2008 versus 2007.      Successor
    
    
    
    Predecessor(dollars in millions)
    
    2008
    
    
    
    2007
    
    
    ChangeCommissions
    
    $
    2.2
    
    
    
    $
    0.9
    
    
    $
    1.3
    (a)General insurance expense
    
    
    2.8
    
    
    
    
    3.2
    
    
    
    (0.4
    )Taxes, licenses, and fees
    
    
    0.5
    
    
    
    
    (0.2
    )
    
    
    0.7
    (b)Total
insurance expenses and taxes
    
    $
    5.5
    
    
    
    $
    3.9
    
    
    $
    1.6
 
 (a)
    
    The increase in commissions is primarily due to commission expense paid to
Transamerica Capital, Inc., a related party during 2008.(b)
    
    The increase in taxes, licenses, and fees is primarily due to lower New York State
Franchise tax in 2007. Segment Information
  32




---



##### 



Successor2009 (dollars in millions)
    
    Annuity
    
    Life
    
    TotalNet revenues (a)
    
    $
    9.3
    
    
    $
    5.8
    
    
    $
    15.1Net income (loss)
    
    
    (7.7
    )
    
    
    1.5
    
    
    
    (6.2
    )
 Successor2008 (dollars in millions)
    
    Annuity
    
    Life
    
    TotalNet revenues (a)
    
    $
    15.5
    
    
    $
    8.7
    
    
    $
    24.2Net income (loss)
    
    
    (4.0
    )
    
    
    1.8
    
    
    
    (2.2
    )
 Predecessor2007 (dollars in millions)
    
    Annuity
    
    Life
    
    Other
    
    TotalNet revenues (a)
    
    $
    16.1
    
    
    $
    7.3
    
    
    $
    2.1
    
    
    $
    25.5Net income
    
    
    7.3
    
    
    
    1.9
    
    
    
    1.4
    
    
    
    10.6
 
 (a)
    
    Management considers interest credited to policyholder liabilities in evaluating net
revenues.  Item 6A. Quantitative and Qualitative Disclosures about Market Risk
 Market Risk
     33




---



##### 



Interest Rate Risk
   2009
    
    2008
    
    2007
    
    2006
    
    20053-Month US Libor
    
    
    0.25
    %
    
    
    1.43
    %
    
    
    4.70
    %
    
    
    5.36
    %
    
    
    4.54
    %10-Year US Treasury
    
    
    3.83
    %
    
    
    2.22
    %
    
    
    4.03
    %
    
    
    4.70
    %
    
    
    4.39
    %
  Estimated Approximate Effects on:Change in Interest Rates: (dollars in millions)
    
    Net Income
    
    Equity2009Shift Up of 100 Basis Points
    
    $
    (0.7
    )
    
    $
    (3.7
    )Shift Down of 100 Basis Points
    
    $
    0.6
    
    
    $
    3.52008Shift Up of 100 Basis Points
    
    $
    0.1
    
    
    $
    (2.8
    )Shift Down of 100 Basis Points
    
    $
    (0.4
    )
    
    $
    2.7
  Credit Risk
  Equity Market Risk
  34




---



##### 



2009
    
    2008
    
    2007
    
    2006
    
    2005S&P 500
    
    
    1,115
    
    
    
    903
    
    
    
    1,468
    
    
    
    1,418
    
    
    
    1,248NASDAQ
    
    
    2,269
    
    
    
    1,577
    
    
    
    2,652
    
    
    
    2,415
    
    
    
    2,205DOW
    
    
    10,428
    
    
    
    8,776
    
    
    
    13,265
    
    
    
    12,463
    
    
    
    10,718
  Estimated Approximate Effecton Net IncomeImmediate Change of: (dollars in millions)
    
    2009
    
    2008Equity Increase of 10%
    
    $
    (0.1
    )
    
    $
    0.7Equity Increase of 20%
    
    $
    (0.2
    )
    
    $
    1.2Equity Decrease of 10%
    
    $
    0.3
    
    
    $
    (2.6
    )Equity Decrease of 20%
    
    $
    0.8
    
    
    $
    (5.8
    )
  Liquidity Risk
  Underwriting Risk
   35




---



##### 



Estimated Approximate Effecton Net IncomeImmediate Change of: (dollars in millions)
    
    2009
    
    200820% Increase in Lapse Rates
    
    $
    (0.1
    )
    
    $
    (1.2
    )20% Decrease in Lapse Rates
    
    $
    0.1
    
    
    $
    1.210% Increase in Mortality Rates
    
    $
    (0.2
    )
    
    $
    (0.9
    )10% Decrease in Mortality Rates
    
    $
    0.3
    
    
    $
    0.5
  Item 7. Financial Statements and Supplementary Data
  Item 8. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
  Item 8A(T). Controls and Procedures
    36




---



##### 



Item 8B. Other Information
  37




---



##### 



PART III
  Item 13. Principal Account Fees and Services
 Fees Paid to the Registrants Independent Auditor
   2009
    
    
    2008Audit (a)
    
    $
    328,000
    
    
    $
    400,000
 
 (a)
    
    Audit fees consist of fees for the annual financial statement audit (including
required quarterly reviews) and other procedures required to be performed by the
independent auditor to be able to form an opinion on MLLICNYs financial statements.
These other procedures include information systems and procedural reviews and testing
performed in order to understand and place reliance on the systems of internal
control, and consultations relating the audit or quarterly review. They also include
fees billed for other audit services, which are those services that only the external
auditor reasonably can provide, and include statutory audits, comfort letters,
services associated with SEC registration statements, periodic reports and other
documents filed with the SEC. Audit Committee Pre-approval Policies and Procedures
   (i)
    
    may be pre-approved by the Audit Committee without consideration of specific case-by-case
services (general pre-approval); or
 (ii)
    
    require the specific pre-approval of the Audit Committee (specific pre-approval).
Appendices to the Pre-approval Policy (that are adopted each year) set out the audit,
audit-related, tax, and other services that have received the general pre-approval of the
Audit Committee. All other audit, audit-related, tax and other services must receive specific
pre-approval from the Audit Committee.
  38




---



##### 



PART IV
 Item 14. Exhibits and Financial Statement Schedules
 (a)
    
    Financial Statements and Exhibits
 (1)
    
    The following financial statements of the Registrant
are filed as part of this report
 a.
    
    Independent Registered Public Accounting Firm Report dated March 25, 2010 (Ernst & Young LLP).b.
    
    Balance Sheets at December 31, 2009 and
2008.c.
    
    Statements of Income for the Years
Ended December 31, 2009, 2008 and 2007.d.
    
    Statements of Comprehensive Income for
the Years Ended December 31, 2009, 2008 and 2007.e.
    
    Statements of Stockholders Equity for
the Years Ended December 31, 2009, 2008 and 2007.f.
    
    Statements of Cash Flows for the Years
Ended December 31, 2009, 2008 and 2007.g.
    
    Notes to Financial Statements for the
Years Ended December 31, 2009, 2008 and 2007.
 (2)
    
    Not applicable.
 (3)
    
    The following exhibits are filed as part of this
report:
 39




---



##### 



|    |  |                                                                                                                                                                                                                                                                                                   
|--- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|3.1 |  | Certificate of Amendment of the Charter of ML Life
Insurance Company of New York. (Incorporated by reference
to Exhibit 6(a)(ii) to Post-Effective Amendment No. 10 to
ML of New York Variable Annuity Account As registration
statement on Form N-4, File No. 33-43654, filed December 9,
1996.)
|3.2 |  | By-Laws of ML Life Insurance Company of New York.
(Incorporated by reference to Exhibit 6(b) to
Post-Effective Amendment No. 10 to ML of New York Variable
Annuity Account As registration statement on Form N-4,
File No. 33-43654, filed December 9, 1996.)                                    
|4.1 |  | Modified Guaranteed Annuity Contract. (Incorporated by
reference to Exhibit 4(a) to Pre-Effective Amendment No. 1
to the Registrants registration statement on Form S-1,
File No. 33-34562, filed October 16, 1990.)                                                                             
|4.2 |  | Modified Guaranteed Annuity Contract Application.
(Incorporated by reference to Exhibit 4(b) to Pre-Effective
Amendment No. 1 to the Registrants registration statement
on Form S-1, File No. 33-34562, filed October 16, 1990.)                                                                 
|4.3 |  | Qualified Retirement Plan Endorsement. (Incorporated by
reference to Exhibit 4(c) to Pre-Effective Amendment No. 1
to the Registrants registration statement on Form S-1,
File No. 33-34562, filed October 16, 1990.)                                                                            
|4.4 |  | IRA Endorsement. (Incorporated by reference to Exhibit 4(d)
to Pre-Effective Amendment No. 1 to the Registrants
registration statement on Form S-1, File No. 33-34562,
filed October 16, 1990.)                                                                                                  
|4.5 |  | Company Name Change Endorsement. (Incorporated by reference
to Exhibit 4(e) to Post-Effective Amendment No. 3 to the
Registrants registration statement on Form S-1, File No.
33-34562, filed March 30, 1992.)                                                                                   
|4.6 |  | IRA Endorsement, MLNY009 (Incorporated by reference to
Exhibit 4(d)(2) to Post-Effective Amendment No. 1 to the
Registrants registration statement on Form S-1, File No.
33-60288, filed March 31, 1994).                                                                                        

40



---



##### 



|     |  |                                                                                                                                                                                                                                                                                                                                               
|---- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|4.7  |  | Modified Guaranteed Annuity Contract MLNY-AY-991/94.
(Incorporated by reference to Exhibit 4(a)(2) to
Post-Effective Amendment No. 3 to the Registrants
registration statement on Form S-1, File No. 33-60288,
filed December 7, 1994).                                                                                                      
|4.8  |  | Qualified Retirement Plan Endorsement MLNY-AYQ-991/94.
(Incorporation by reference to Exhibit 4(c)(2) to
Post-Effective Amendment No. 3 to the Registrants
registration statement on Form S-1, File No. 33-60288,
filed December 7, 1994).                                                                                                   
|10.1 |  | General Agency Agreement between Royal Tandem Life
Insurance Company and Merrill Lynch Life Agency Inc.
(Incorporated by reference to Exhibit 10(a) to
Pre-Effective Amendment No. 1 to the Registrants
registration statement on Form S-1, File No. 33-34562,
filed October 16, 1990.)                                                      
|10.2 |  | Investment Management Agreement by and between Royal Tandem
Life Insurance Company and Equitable Capital Management
Corporation. (Incorporated by reference to Exhibit 10(b) to
Pre-Effective Amendment No. 1 to the Registrants
registration statement on Form S-1, File No. 33-34562,
filed October 16, 1990.)                             
|10.3 |  | Shareholders Agreement by and among The Equitable Life
Assurance Society of the United States and Merrill Lynch & Co., Inc. and Tandem Financial Group, Inc. (Incorporated by
reference to Exhibit 10(c) to Pre-Effective Amendment No. 1
to the Registrants registration statement on Form S-1,
File No. 33-34562, filed October 16, 1990.)
|10.4 |  | Service Agreement by and between Royal Tandem Life
Insurance Company and Tandem Financial Group, Inc.
(Incorporated by reference to Exhibit 10(d) to
Pre-Effective Amendment No. 1 to the Registrants
registration statement on Form S-1, File No. 33-34562,
filed October 16, 1990.)                                                        
|10.5 |  | Service Agreement by and between Tandem Financial Group,
Inc. and Merrill Lynch & Co., Inc. (Incorporated by
reference to Exhibit 10(e) to Pre-Effective Amendment No. 1
to the Registrants registration statement on Form S-1,
File No. 33-34562, filed October 16, 1990.)                                                                  

41



---



##### 



|      |  |                                                                                                                                                                                                                                                                                                                                                                       
|----- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|10.6  |  | Form of Investment Management Agreement by and between
Royal Tandem Life Insurance Company and Merrill Lynch Asset
Management, Inc. (Incorporated by reference to Exhibit
10(f) to Post-Effective Amendment No. 1 to the Registrants
registration statement on Form S-1, File No. 33-34562,
filed March 7, 1991.)                                                    
|10.7  |  | Assumption Reinsurance Agreement between Merrill Lynch Life
Insurance Company, Tandem Insurance Group, Inc. and Royal
Tandem Life Insurance Company and Family Life Insurance
Company. (Incorporated by reference to Exhibit 10(g) to
Post-Effective Amendment No. 3 to the Registrants
registration statement on Form S-1, File No. 33-34562,
filed March 30, 1992.)
|10.8  |  | Indemnity Agreement between ML Life Insurance Company of
New York and Merrill Lynch Life Agency, Inc. (Incorporated
by reference to Exhibit 10(h) to Post-Effective Amendment
No. 3 to the Registrants registration statement on Form
S-1, File No. 33-34562, filed March 30, 1992.)                                                                                 
|10.9  |  | Amended General Agency Agreement between ML Life Insurance
Company of New York and Merrill Lynch Life Agency, Inc.
(Incorporated by reference to Exhibit 10(i) to
Post-Effective Amendment No. 3 to the Registrants
registration statement on Form S-1, File No. 33-34562,
filed March 30, 1992.)                                                                    
|10.10 |  | Amended Management Agreement between ML Life Insurance
Company of New York and Merrill Lynch Asset Management,
Inc. (Incorporated by reference to Exhibit 10(j) to the
Registrants registration statement on Form S-1, File No.
33-60288, filed March 30, 1993.)                                                                                                     
|10.11 |  | Mortgage Loan Servicing Agreement between ML Life Insurance
Company of New York and Merrill Lynch & Co., Inc.
(Incorporated by reference to Exhibit 10(k) to
Post-Effective Amendment No. 4 to the Registrants
registration statement on Form S-1, File No. 33-60288,
filed March 29, 1995.)                                                                         
|10.12 |  | Master Distribution Agreement between Merrill Lynch Insurance Group, Inc., Merrill
Lynch & Co., Inc., and AEGON USA, Inc. (Incorporated by reference to
Exhibit 10.2 to Registrants Current Report on Form 8-K, File No. 33-34562, filed
January 4, 2008.)                                                                                                           
|10.13 |  | Non-Affiliated Broker-Dealer Wholesaling Agreement between ML Life Insurance
Company of New York, Merrill Lynch, Pierce, Fenner & Smith Incorporated, and
Transamerica Capital, Inc. (Incorporated by reference to Exhibit 10.13 to the
Registrants Annual Report on Form 10-K, File Nos. 33-34562, 33-60288, 333-48983,
and 333-133224, filed March 27, 2008.)      
|10.14 |  | Selling Agreement between ML Life Insurance Company of New York, Merrill Lynch,
Pierce, Fenner & Smith Incorporated, and Merrill Lynch Life Agency, Inc.
(Incorporated by reference to Exhibit 10.14 to the Registrants Annual Report on
Form 10-K, File Nos. 33-34562, 33-60288, 333-48983, and 333-133224, filed March 27, 2008.)                                  
|10.15 |  | Keep Well Agreement between AEGON USA And ML Life Insurance Company of New York.
(Incorporated by reference to Exhibit 10.15 to the Registrants Annual Report on
Form 10-K, File Nos. 33-34562, 33-60288, 333-48983, and 333-133224, filed March 27, 2008.)                                                                                                          
|10.16 |  | Purchase Agreement between Merrill Lynch Insurance Group, Inc., Merrill
Lynch & Co., Inc., and AEGON USA, Inc. (Incorporated by reference to Exhibit 10.1 to
Registrants Current Report on Form 8-K, File No. 33-34562, filed August 17, 2007.)                                                                                                                      
|10.17 |  | First Amendment to Purchase Agreement between Merrill Lynch
Insurance Group, Inc., Merrill Lynch & Co., Inc., and AEGON USA,
Inc. (Incorporated by reference to Exhibit 10.1 to Registrants Current
Report on Form 8-K, File No. 33-34562, filed January 4, 2008.)                                                                                                   
|10.18 |  | Principal Underwriting Agreement between Transamerica Capital, Inc. and ML Life
Insurance Company of New York (Incorporated by reference to Exhibit 10.18 to the Registrants Annual Report on Form 10-K, File
Nos. 33-34562,
 33-60288, 333-48983, and 333-133224, filed March 26, 2009.)                                                                            
|24.1  |  | Powers of Attorney are filed herewith.                                                                                                                                                                                                                                                                                                                                

42



---



##### 



|     |  |                                                                                                                                                                                            
|---- |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|31.1 |  | Certification by the Chief Executive Officer of the Registrant
pursuant to Rule 15d-14(a), is filed herewith.                                                                              
|31.2 |  | Certification by the Chief Financial Officer of the Registrant
pursuant to Rule 15d-14(a), is filed herewith.                                                                              
|32.1 |  | Certification by the Chief Executive Officer of the
Registrant pursuant to 18 U.S.C. Section 1350, as
adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002, is filed herewith.
|32.2 |  | Certification by the Chief Financial Officer of the
Registrant pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002,
is filed herewith.

43



---



##### 



Management Report on Internal Control over Financial Reporting
 MANAGEMENT REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING
     44




---



##### 



INDEX TO FINANCIAL STATEMENTS
        45




---



##### 



46




---



##### 



ML LIFE INSURANCE COMPANY OF NEW YORK
(A WHOLLY OWNED SUBSIDIARY OF AEGON USA, LLC)BALANCE SHEETS
 SuccessorDecember 31,(dollars in thousands, except share data)
    
    2009
    
    
    2008ASSETSInvestmentsFixed maturity available-for-sale securities, at estimated
fair value (amortized cost: 2009 - $110,939; 2008 - $127,986)
    
    $
    113,927
    
    
    $
    115,834Equity available-for-sale securities, at estimated fair value
(cost: 2009 - $80; 2008 - $257)
    
    
    57
    
    
    
    163Policy loans
    
    
    63,045
    
    
    
    67,387Total investments
    
    
    177,029
    
    
    
    183,384Cash and cash equivalents
    
    
    49,423
    
    
    
    29,973Accrued investment income
    
    
    2,706
    
    
    
    3,158Deferred policy acquisition costs
    
    
    360
    
    
    
    373Deferred sales inducements
    
    
    130
    
    
    
    165Value of business acquired
    
    
    30,982
    
    
    
    41,525Goodwill
    
    
    500
    
    
    
    500Federal income taxes  current
    
    
    
    
    
    
    1,443Federal income taxes  deferred
    
    
    
    
    
    
    5,183Reinsurance receivables
    
    
    1,782
    
    
    
    680Receivable for investments sold  net
    
    
    65
    
    
    
    Other assets
    
    
    2,624
    
    
    
    5,018Separate Accounts assets
    
    
    644,149
    
    
    
    598,438Total Assets
    
    $
    909,750
    
    
    $
    869,840LIABILITIES AND STOCKHOLDERS EQUITYLiabilitiesPolicyholder liabilities and accrualsPolicyholder account balances
    
    $
    125,329
    
    
    $
    135,062Future policy benefits
    
    
    18,486
    
    
    
    19,872Claims and claims settlement expenses
    
    
    1,918
    
    
    
    2,096145,733
    
    
    
    157,030Other policyholder funds
    
    
    157
    
    
    
    204Federal income taxes  current
    
    
    368
    
    
    
    Federal income taxes  deferred
    
    
    618
    
    
    
    Affiliated payables  net
    
    
    235
    
    
    
    49Other liabilities
    
    
    932
    
    
    
    827Separate Accounts liabilities
    
    
    644,149
    
    
    
    598,438Total Liabilities
    
    
    792,192
    
    
    
    756,548Stockholders EquityCommon stock ( $10 par value; 220,000 shares authorized,
issued and outstanding)
    
    
    2,200
    
    
    
    2,200Additional paid-in capital
    
    
    128,638
    
    
    
    128,638Accumulated other comprehensive income (loss), net of taxes
    
    
    2,050
    
    
    
    (8,333
    )Retained deficit
    
    
    (15,330
    )
    
    
    (9,213
    )Total Stockholders Equity
    
    
    117,558
    
    
    
    113,292Total Liabilities and Stockholders Equity
    
    $
    909,750
    
    
    $
    869,840
  47




---



##### 



ML LIFE INSURANCE COMPANY OF NEW YORK
(A WHOLLY OWNED SUBSIDIARY OF AEGON USA, LLC)STATEMENTS OF INCOME
 For the Years Ended December 31,Successor
    
    
    
    Predecessor(dollars in thousands)
    
    2009
    
    
    2008
    
    
    
    2007RevenuesPolicy charge revenue
    
    $
    14,774
    
    
    $
    18,531
    
    
    
    $
    20,782Net investment income
    
    
    9,900
    
    
    
    11,066
    
    
    
    
    11,246Net realized investment gains (losses)Total other-than-temporary impairment losses
on securities
    
    
    (909
    )
    
    
    (520
    )
    
    
    
    Portion of loss recognized in other
comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    Net
other-than-temporary impairment losses on securities recognized in income
    
    
    (909
    )
    
    
    (520
    )
    
    
    
    Realized investment gains (losses), excluding
other-than-temporary impairment losses
on securities
    
    
    (2,054
    )
    
    
    1,302
    
    
    
    
    1,141Net realized investment gains (losses)
    
    
    (2,963
    )
    
    
    782
    
    
    
    
    1,141Total Revenues
    
    
    21,711
    
    
    
    30,379
    
    
    
    
    33,169Benefits and ExpensesInterest credited to policyholder liabilities
    
    
    6,597
    
    
    
    6,180
    
    
    
    
    7,643Policy
benefits (net of reinsurance recoveries:
2009 - $61; 2008 - $496; 2007 - $1,846)
    
    
    3,278
    
    
    
    2,625
    
    
    
    
    2,069Reinsurance premium ceded
    
    
    383
    
    
    
    1,404
    
    
    
    
    1,872Amortization of deferred policy acquisition costs
    
    
    117
    
    
    
    31
    
    
    
    
    2,184Amortization and impairment of value of business acquired
    
    
    10,800
    
    
    
    9,025
    
    
    
    
    Amortization of other intangibles
    
    
    
    
    
    
    368
    
    
    
    
    Impairment charges
    
    
    
    
    
    
    9,879
    
    
    
    
    Insurance expenses and taxes
    
    
    5,980
    
    
    
    5,544
    
    
    
    
    3,942Total Benefits and Expenses
    
    
    27,155
    
    
    
    35,056
    
    
    
    
    17,710Income (Loss) Before Taxes
    
    
    (5,444
    )
    
    
    (4,677
    )
    
    
    
    15,459Federal Income Tax Expense (Benefit)Current
    
    
    561
    
    
    
    
    
    
    
    
    3,786Deferred
    
    
    176
    
    
    
    (2,464
    )
    
    
    
    1,062Federal Income Tax Expense (Benefit)
    
    
    737
    
    
    
    (2,464
    )
    
    
    
    4,848Net Income (Loss)
    
    $
    (6,181
    )
    
    $
    (2,213
    )
    
    
    $
    10,611
  48




---



##### 



ML LIFE INSURANCE COMPANY OF NEW YORK
(A WHOLLY OWNED SUBSIDIARY OF AEGON USA, LLC)
STATEMENTS OF COMPREHENSIVE INCOME
 For the Years Ended December 31,Successor
    
    
    
    Predecessor(dollars in thousands)
    
    2009
    
    
    2008
    
    
    
    2007Net Income (Loss)
    
    $
    (6,181
    )
    
    $
    (2,213
    )
    
    
    $
    10,611Other Comprehensive Income (Loss)Net unrealized gains (losses) on available-for-sale securitiesNet unrealized holding gains (losses) arising during the period
    
    
    12,600
    
    
    
    (12,246
    )
    
    
    
    499Reclassification adjustment for (gains) losses
included in net income
    
    
    2,629
    
    
    
    
    
    
    
    
    (2
    )15,229
    
    
    
    (12,246
    )
    
    
    
    497Net unrealized other-than-temporary impairment
gains (losses) on securitiesNet unrealized other-than-temporary impairment
gains arising during the period
    
    
    79
    
    
    
    
    
    
    
    
    Reclassification adjustment for other-than-temporary impairment
gains included in net income
    
    
    (33
    )
    
    
    
    
    
    
    
    46
    
    
    
    
    
    
    
    
    AdjustmentsPolicyholder liabilities
    
    
    333
    
    
    
    (83
    )
    
    
    
    (20
    )Deferred policy acquisition costs
    
    
    38
    
    
    
    (38
    )
    
    
    
    Value of business acquired
    
    
    392
    
    
    
    (454
    )
    
    
    
    Deferred federal income taxes
    
    
    (5,591
    )
    
    
    4,488
    
    
    
    
    (167
    )(4,828
    )
    
    
    3,913
    
    
    
    
    (187
    )Total other comprehensive income (loss), net of taxes
    
    
    10,447
    
    
    
    (8,333
    )
    
    
    
    310Comprehensive Income (Loss)
    
    $
    4,266
    
    
    $
    (10,546
    )
    
    
    $
    10,921
  49




---



##### 



ML LIFE INSURANCE COMPANY OF NEW YORK
(A WHOLLY OWNED SUBSIDIARY OF AEGON USA, LLC)STATEMENTS OF STOCKHOLDERS EQUITY
 For the Years Ended December 31,Successor
    
    
    
    Predecessor(dollars in thousands)
    
    2009
    
    
    2008
    
    
    
    2007Common Stock
    
    $
    2,200
    
    
    $
    2,200
    
    
    
    $
    2,200Additional Paid-in CapitalBalance at beginning of year
    
    $
    128,638
    
    
    $
    128,638
    
    
    
    $
    52,310Effect of push down accounting of AEGON USA, LLCs
purchase price on ML Life Insurance Company of New
Yorks net assets acquired
    
    
    
    
    
    
    
    
    
    
    
    76,328Balance at end of year
    
    $
    128,638
    
    
    $
    128,638
    
    
    
    $
    128,638Accumulated Other Comprehensive Income (Loss)Balance at beginning of year
    
    $
    (8,333
    )
    
    $
    
    
    
    
    $
    (753
    )Total other comprehensive income (loss), net of taxes
    
    
    10,447
    
    
    
    (8,333
    )
    
    
    
    310Cumulative effect of adoption of other-than-temporary
impairment guidance (ASC 320)
    
    
    (64
    )
    
    
    
    
    
    
    
    Effect of push down accounting of AEGON USA, LLCs
purchase price on ML Life Insurance Company of New
Yorks net assets acquired
    
    
    
    
    
    
    
    
    
    
    
    443Balance at end of year
    
    $
    2,050
    
    
    $
    (8,333
    )
    
    
    $
    Retained Earnings (Deficit)Balance at beginning of year
    
    $
    (9,213
    )
    
    $
    
    
    
    
    $
    34,009Net income (loss)
    
    
    (6,181
    )
    
    
    (2,213
    )
    
    
    
    10,611Cumulative effect of adoption of other-than-temporary
impairment guidance (ASC 320)
    
    
    64
    
    
    
    
    
    
    
    
    Cash dividend paid to AEGON USA, LLC
    
    
    
    
    
    
    (7,000
    )
    
    
    
    Cash dividend paid to Merrill Lynch Insurance Group, Inc.
    
    
    
    
    
    
    
    
    
    
    
    (5,453
    )Effect of push down accounting of AEGON USA, LLCs
purchase price on ML Life Insurance Company of New
Yorks net assets acquired
    
    
    
    
    
    
    
    
    
    
    
    (39,167
    )Balance at end of year
    
    $
    (15,330
    )
    
    $
    (9,213
    )
    
    
    $
    Total Stockholders Equity
    
    $
    117,558
    
    
    $
    113,292
    
    
    
    $
    130,838
  50




---



##### 



ML LIFE INSURANCE COMPANY OF NEW YORK
(A WHOLLY OWNED SUBSIDIARY OF AEGON USA, LLC)STATEMENTS OF CASH FLOWS
 For the Years Ended December 31,Successor
    
    
    
    Predecessor(dollars in thousands)
    
    2009
    
    
    2008
    
    
    
    2007CASH FLOWS FROM OPERATING ACTIVITIESNet income (loss)
    
    $
    (6,181
    )
    
    $
    (2,213
    )
    
    
    $
    10,611Adjustment to reconcile net income (loss) to net cash and cash
equivalents provided by operating activities:Changes in:Deferred policy acquisition costs
    
    
    51
    
    
    
    (411
    )
    
    
    
    433Deferred sales inducements
    
    
    35
    
    
    
    (165
    )
    
    
    
    (557
    )Value of business acquired
    
    
    10,800
    
    
    
    9,025
    
    
    
    
    Other intangibles
    
    
    
    
    
    
    368
    
    
    
    
    Benefit reserves
    
    
    (598
    )
    
    
    (1,290
    )
    
    
    
    (592
    )Federal income tax accruals
    
    
    1,986
    
    
    
    (3,178
    )
    
    
    
    1,062Claims and claims settlement expenses
    
    
    (178
    )
    
    
    (2,522
    )
    
    
    
    (3,883
    )Other policyholder funds
    
    
    (47
    )
    
    
    (785
    )
    
    
    
    310Other operating assets and liabilities, net
    
    
    1,968
    
    
    
    1,091
    
    
    
    
    (2,559
    )Amortization (accretion) of investments
    
    
    (188
    )
    
    
    (64
    )
    
    
    
    238Impairment charges
    
    
    
    
    
    
    9,879
    
    
    
    
    Interest credited to policyholder liabilities
    
    
    6,597
    
    
    
    6,180
    
    
    
    
    7,643Net realized investment (gains) losses
    
    
    2,963
    
    
    
    (782
    )
    
    
    
    (1,141
    )Net cash and cash equivalents provided by operating activities
    
    
    17,208
    
    
    
    15,133
    
    
    
    
    11,565CASH FLOWS FROM INVESTING ACTIVITIESSales of available-for-sale securities
    
    
    28,544
    
    
    
    32,068
    
    
    
    
    12,210Maturities of available-for-sale securities
    
    
    12,358
    
    
    
    36,215
    
    
    
    
    41,362Purchases of available-for-sale securities
    
    
    (24,370
    )
    
    
    (95,749
    )
    
    
    
    (19,808
    )Net settlements on futures contracts
    
    
    (1,849
    )
    
    
    1,273
    
    
    
    
    Policy loans on insurance contracts, net
    
    
    4,342
    
    
    
    1,778
    
    
    
    
    3,614Net cash and cash equivalents provided by (used in) investing activities
    
    
    19,025
    
    
    
    (24,415
    )
    
    
    
    37,378CASH FLOWS FROM FINANCING ACTIVITIESPolicyholder deposits
    
    
    2,907
    
    
    
    9,090
    
    
    
    
    32,544Policyholder withdrawals
    
    
    (19,690
    )
    
    
    (23,241
    )
    
    
    
    (51,580
    )Cash dividend paid to AEGON USA, LLC
    
    
    
    
    
    
    (7,000
    )
    
    
    
    Cash dividend paid to Merrill Lynch Insurance Group, Inc.
    
    
    
    
    
    
    
    
    
    
    
    (5,453
    )Net cash and cash equivalents used in financing activities
    
    
    (16,783
    )
    
    
    (21,151
    )
    
    
    
    (24,489
    )Net increase (decrease) in cash and cash equivalents (1)
    
    
    19,450
    
    
    
    (30,433
    )
    
    
    
    24,454Cash and cash equivalents, beginning of year
    
    
    29,973
    
    
    
    60,406
    
    
    
    
    35,952Cash and cash equivalents, end of year
    
    $
    49,423
    
    
    $
    29,973
    
    
    
    $
    60,406
 
 (1)
    
    Included in net increase (decrease) in cash and cash equivalents is interest received
(2009  $0; 2008  $6; 2007  $0); interest paid
(2009  $1; 2008  $9; 2007  $74); federal income taxes paid
(2009  $100; 2008  $1,443; 2007  $5,686); and federal income
taxes received (2009  $1,350; 2008  $729; 2007  $0)  51




---



##### 



ML LIFE INSURANCE COMPANY OF NEW YORK
(A WHOLLY OWNED SUBSIDIARY OF AEGON USA, LLC)
NOTES TO FINANCIAL STATEMENTS
  Note 1. Summary of Significant Accounting Policies
 Basis of Presentation
    Basis of Reporting
     Accounting Estimates and Assumptions
  52




---



##### 



Investments
 Fixed maturity and equity securities
     Other-than-temporary impairments (OTTI)
     53




---



##### 



Policy loans
  Derivative Instruments
  Cash and Cash Equivalents
  Deferred Policy Acquisition Costs (DAC)
      Deferred Sales Inducements (DSI)
  54




---



##### 



Value of Business Acquired (VOBA)
  Other Intangibles
  Goodwill
  55




---



##### 



Separate Accounts
   Policyholder Account Balances
  2009
    
    2008Interest-sensitive life products
    
    
    4.00%
    
    
    
    4.00%Interest-sensitive deferred annuities
    
    
    3.00% - 6.80
    %
    
    
    3.00% - 6.80
    %
  Future Policy Benefits
  2009
    
    2008Interest rates used for liabilities
    
    
    2.55% - 5.75
    %
    
    
    2.55% - 5.75
    %
 Revenue Recognition
    56




---



##### 



Claims and Claims Settlement Expenses
  Federal Income Taxes
 .
    Subsequent Events
   Recent Accounting Guidance
 Current Adoption of Recent Accounting Guidance
 TM
 Generally Accepted Accounting Principles
 TM
 Investments Debt and Equity Securities
  57




---



##### 



Fair Value Measurements and Disclosures
 
    
    The Company adopted guidance on measuring the fair value of certain alternative
investments (i.e., investments in hedge funds, private equity funds, venture capital funds,
offshore fund vehicles, funds of funds, and real estate funds) as of the period ended
December 31, 2009 (ASU 2009-12, Investments in Certain Entities That Calculate Net Asset
Value per Share (or Its Equivalent)). The guidance applies to investments in entities where
the fair value of the instrument is not readily determinable and the investment is in an
entity that has all of the attributes of an investment company (as specified in ASC
946-10-15-2). If an investment is in scope, it permits, as a practical expedient, a
reporting entity to use the investments net asset value (NAV) to estimate its fair
value, provided that the NAV is calculated as of the reporting entitys measurement date.
The guidance prohibits the use of the NAV in estimating fair value when it is probable that
an entity will sell the investment (or a portion thereof) at a price other than NAV. The
guidance also requires enhanced disclosures by major category of investments about the
nature and risks of investments within its scope. The adoption did not have a material
impact on the Companys financial statements.
    
    The Company adopted guidance, as of the period ended December 31, 2009, which clarified
that when a quoted price in an active market for an identical liability is not available,
an entity should measure fair value using one of the following approaches that maximizes
the use of relevant observable inputs and minimizes the use of unobservable inputs: a) a
valuation technique that uses the quoted price of the identical liability when traded as an
asset; b) a valuation technique that uses quoted prices for similar liabilities or similar
liabilities when traded as assets; or c) another valuation technique that is consistent
with fair value measurement guidance (e.g., income approach or a market approach) (ASU
2009-05, Measuring Liabilities at Fair Value). The guidance also clarifies that an entity
should not make a separate adjustment for restrictions on the transfer of a liability in
estimating the liabilitys fair value. The guidance also specifies that when measuring the
fair value of a liability using the price of the liability when traded as an asset, the
price should be adjusted for factors specific to the asset that are not applicable to the
fair value measurement of the liability. The adoption did not have a material impact on the
Companys financial statements.
    
    The Company adopted guidance for estimating fair value when the volume and
level of activity for an asset or liability have significantly decreased as well as
guidance on identifying circumstances that indicate a transaction is not orderly as of the
period ended June 30, 2009. The guidance provides a list of factors that an entity should
consider when determining whether there has been a significant decrease in the volume and
level of activity for an asset or liability when compared to normal market activity for
that asset or liability. The guidance also requires interim disclosures of the inputs and
valuation techniques used to measure fair value and disclosure of any changes to those
inputs and valuation techniques during the period. The adoption did not have a material
impact on the Companys financial statements. This guidance was formerly known as FSP No.
FAS 157-4, Determining Fair Value When the Volume and Level of Activity for the Asset or
Liability Have Significantly Decreased and Identifying Transactions That Are Not Orderly.
Upon adoption, this guidance superseded previous guidance formerly known as FSP No. FAS
157-3, Determining the Fair Value of a Financial Asset in a Market That Is Not Active.
    
    The Company adopted guidance requiring disclosures about fair value of
financial instruments in interim reporting periods as well as annual periods as of the
period ended June 30, 2009. The guidance requires an entity to disclose the
methods and significant assumptions used to estimate fair value of financial instruments and
to describe changes, if any, to those methods and assumptions during the period.
 58




---



##### 



The adoption affected disclosures but did not impact the Companys results of operations or
financial position. This guidance was formerly known as FSP No. FAS 107-1 and Accounting
Principles Board Opinion No. 28-1, Interim Disclosures about Fair Value of Financial
Instruments.
    
    On January 1, 2008, the Company adopted guidance providing a fair value option
election that allows companies to irrevocably elect fair value as the initial and
subsequent measurement attribute for certain financial assets and liabilities, with changes
in fair value recognized in earnings as they occur. The guidance permits the fair value
option election on an instrument by instrument basis at initial recognition of an asset or
liability or upon an event that gives rise to a new basis of accounting for that
instrument. The adoption did not have a material impact on the Companys financial
statements. See Note 3 to the Financial Statements for additional disclosures. This
guidance was formerly known as SFAS No. 159, The Fair Value Option for Financial Assets and
Financial Liabilities.
    
    On January 1, 2008, the Company adopted guidance that defines fair value,
establishes a framework for measuring fair value in accordance with generally accepted
accounting principles and expands disclosures about fair value measurements. The adoption
did not have a material impact on the Companys financial statements. See Note 3 to the
Financial Statements for additional disclosures. This guidance was formerly known as SFAS
No. 157, Fair Value Measurements.
 , Subsequent Events
   InvestmentsOther; Beneficial Interests in Securitized Financial Assets
  Derivatives and Hedging
 
    
    On January 1, 2009, the Company adopted guidance that amends and expands the
disclosure requirements related to derivative instruments and hedging activities to provide
users of financial statements with an enhanced understanding of: (a) how and why an entity
uses derivative instruments, (b) how derivative instruments and related hedged items are
accounted for, and (c) how derivative instruments and related hedged items affect an
entitys financial position, financial performance, and cash flows. The adoption did not
impact the Companys results of operations or financial position. This guidance was
formerly known as SFAS No. 161, Disclosures about Derivative Instruments and Hedging
Activities  an amendment of FASB Statement No. 133.
    
    The Company adopted guidance requiring disclosures by sellers of credit
derivatives, including credit derivatives embedded in hybrid instruments as of the period
ended December 31, 2008. The amendments also require additional disclosure about the
current status of the payment/performance risk of a guarantee. The adoption did not have a
material impact on the Companys financial statements. This guidance was formerly known as
FSP No. FAS 133-1 and FASB Interpretation No. 45-4, Disclosures about Credit Derivatives
and Certain Guarantees: An Amendment of FASB Statement No. 133 and FASB Interpretation No.
45; and Clarification of the Effective Date of FASB Statement No. 161.
 59




---



##### 



Business Combinations
  IntangiblesGoodwill and Other
  Future Adoption of Recent Accounting Guidance
 Fair Value Measurements and Disclosures
 Improving Disclosures about Fair Value Measurements
  Note 2. 2008 Initial Purchase Price Allocation Adjustments
    60




---



##### 



Purchase Price AllocationDecember 31,
    
    
    
    
    
    December 312007
    
    Adjustments
    
    2008 (a)Value of business acquired, gross
    
    $
    44,024
    
    
    $
    6,829
    
    
    $
    50,853Goodwill
    
    
    6,882
    
    
    
    (3,286
    )
    
    
    3,596Other intangibles
    
    
    8,330
    
    
    
    (1,180
    )
    
    
    7,150Federal income taxes  current
    
    
    836
    
    
    
    (107
    )
    
    
    729Reinsurance receivable
    
    
    925
    
    
    
    26
    
    
    
    951Other assets
    
    
    5,200
    
    
    
    50
    
    
    
    5,250Policyholder account balances
    
    
    140,782
    
    
    
    4,129
    
    
    
    144,911Future policy benefits
    
    
    22,764
    
    
    
    (3,566
    )
    
    
    19,198Federal income taxes  deferred
    
    
    
    
    
    
    1,769
    
    
    
    1,769
 
 (a)
    
    This reflects the December 31, 2008 balance before adjustments for unrealized gains
(losses) on investments, amortization and/or impairments.  th
  Note 3. Fair Value of Financial Instruments
 Fair Value Measurements
  Fair Value Hierarchy
  61




---



##### 



Level 1
 Level 2
     Level 3
  December 31, 2009Level 1
    
    
    Level 2
    
    
    Level 3
    
    
    TotalAssetsFixed maturity securities (a)
    
    $
    3,134
    
    
    $
    108,577
    
    
    $
    2,216
    
    
    $
    113,927Equity securities (a)
    
    
    
    
    
    
    57
    
    
    
    
    
    
    
    57Cash equivalents (b)
    
    
    
    
    
    
    47,114
    
    
    
    
    
    
    
    47,114Separate
Accounts assets (c)
    
    
    644,149
    
    
    
    
    
    
    
    
    
    
    
    644,149Total assets
    
    $
    647,283
    
    
    $
    155,748
    
    
    $
    2,216
    
    
    $
    805,247LiabilitiesFuture policy benefits(embedded derivatives only) (d)
    
    $
    
    
    
    $
    
    
    
    $
    (4,482
    )
    
    $
    (4,482
    )Total liabilities
    
    $
    
    
    
    $
    
    
    
    $
    (4,482
    )
    
    $
    (4,482
    )
 December 31, 2008Level 1
    
    
    Level 2
    
    
    Level 3
    
    
    TotalAssetsFixed maturity securities (a)
    
    $
    2,316
    
    
    $
    108,410
    
    
    $
    5,108
    
    
    $
    115,834Equity securities (a)
    
    
    
    
    
    
    163
    
    
    
    
    
    
    
    163Cash equivalents (b)
    
    
    
    
    
    
    33,253
    
    
    
    
    
    
    
    33,253Separate Accounts assets (c)
    
    
    598,438
    
    
    
    
    
    
    
    
    
    
    
    598,438Total assets
    
    $
    600,754
    
    
    $
    141,826
    
    
    $
    5,108
    
    
    $
    747,688LiabilitiesFuture policy benefits
(embedded derivatives only) (d)
    
    $
    
    
    
    $
    
    
    
    $
    (3,179
    )
    
    $
    (3,179
    )Total liabilities
    
    $
    
    
    
    $
    
    
    
    $
    (3,179
    )
    
    $
    (3,179
    )
 62




---



##### 



(a)
    
    Securities are classified as Level 1 if the fair value is determined by observable
inputs that reflect quoted prices for identical assets in active markets that the
Company has the ability to access at the measurement date. Level 1 securities include
highly liquid U.S. Treasury and U.S. Government Agency securities. Securities are
classified as Level 2 if the fair value is determined by observable inputs, other than
quoted prices included in Level 1, for the asset or prices for similar assets. Level 2
securities include fixed maturity securities and preferred stock for which the Company
utilized pricing services and corroborated broker quotes. Securities are classified as
Level 3 if the valuations are derived from techniques in which one or more of the
significant inputs are unobservable. Level 3 consists principally of fixed maturity
securities whose fair value is estimated based on non-binding broker quotes.(b)
    
    Cash equivalents are primarily valued at amortized cost, which approximates fair
value. Operating cash is not included in the abovementioned table.(c)
    
    Separate Accounts assets are carried at the net asset value provided by the fund
managers.(d)
    
    The Company issued contracts containing guaranteed minimum withdrawal benefits
riders (GMWB) and obtained reinsurance on guaranteed minimum income benefit riders
(GMIB reinsurance). GMWB and GMIB reinsurance are treated as embedded derivatives and
are required to be reported separately from the host variable annuity contract. The
fair value of these guarantees are calculated as the present value of future expected
payments to policyholders less the present value of assessed rider fees attributable to
the guarantees. Given the complexity and long-term nature of these guarantees, their
fair values are determined using stochastic techniques under a variety of market return,
discount rates and actuarial assumptions. Since many of the assumptions are unobservable
and are considered to be significant inputs to the liability valuation, the liability
included in future policy benefits has been reflected within Level 3 of the fair value
hierarchy.  Fixed maturity securities
    
    December 31, 2009
    
    
    December 31, 2008Balance at beginning of year (a)
    
    $
    5,108
    
    
    $
    1,244Total change in unrealized gains (losses) (b)
    
    
    (125
    )
    
    
    (1,166
    )Purchases
    
    
    
    
    
    
    3,002Sales
    
    
    (432
    )
    
    
    Transfers into Level 3
    
    
    2,768
    
    
    
    2,007Transfers out of Level 3
    
    
    (5,108
    )
    
    
    Changes in valuation (c)
    
    
    5
    
    
    
    21Balance at end of year (a)
    
    $
    2,216
    
    
    $
    5,108
 
 (a)
    
    Recorded as a component of fixed maturity available-for-sale securities in the
Balance Sheets.(b)
    
    Recorded as a component of other comprehensive income (loss).(c)
    
    Recorded as a component of net investment income in the Statements of Income.   63




---



##### 



December 31, 2009
    
    
    December 31, 2008GMIB
    
    
    
    
    
    
    GMIBGMWB
    
    
    Reinsurance
    
    
    GMWB
    
    
    ReinsuranceBalance at beginning of period (b)
    
    $
    4,270
    
    
    $
    (7,449
    )
    
    $
    595
    
    
    $
    (395
    )Purchase price adjustment
    
    
    
    
    
    
    
    
    
    
    (267
    )
    
    
    (1,078
    )Changes in valuation (a)
    
    
    (3,007
    )
    
    
    1,704
    
    
    
    3,942
    
    
    
    (5,976
    )Balance at end of period (b)
    
    $
    1,263
    
    
    $
    (5,745
    )
    
    $
    4,270
    
    
    $
    (7,449
    )
 
 (a)
    
    Recorded as a component of policy benefits in the Statements of Income.(b)
    
    Recorded as a component of future policy benefits in the Balance Sheets.  Note 4. Investments
 Fixed Maturity and Equity Securities
    NetUnrealized
    
    
    Unrealized
    
    
    TotalOTTI
    
    
    Loss on
    
    
    Cumulativeon Available-
    
    
    Available-
    
    
    EffectFor-Sale
    
    
    For-Sale
    
    
    AdjustmentSecurities
    
    
    Securities
    
    
    in OCIIncrease in amortized cost of available-for-sale securities
    
    $
    70
    
    
    $
    131
    
    
    $
    201Change in VOBA
    
    
    
    
    
    
    (102
    )
    
    
    (102
    )Income tax
    
    
    (24
    )
    
    
    (11
    )
    
    
    (35
    )Net cumulative effect adjustment
    
    $
    46
    
    
    $
    18
    
    
    $
    64
 64




---



##### 



Fixed maturity securitiesCorporate securities
    
    $
    200Government and government agencies  United States
    
    
    1Total fixed maturity securities
    
    $
    201
  December 31, 2009EstimatedAmortized
    
    
    Gross Unrealized
    
    
    
    
    
    
    FairCost
    
    
    Gains
    
    
    Losses
    
    
    OTTI (1)
    
    
    ValueFixed maturity securitiesCorporate securities
    
    $
    62,214
    
    
    $
    3,609
    
    
    $
    (339
    )
    
    $
    
    
    
    $
    65,484Asset-backed securities
    
    
    7,179
    
    
    
    240
    
    
    
    (205
    )
    
    
    
    
    
    
    7,214Commercial mortgage-backed securities
    
    
    25,788
    
    
    
    363
    
    
    
    (623
    )
    
    
    
    
    
    
    25,528Residential mortgage-backed securities
    
    
    9,024
    
    
    
    331
    
    
    
    (240
    )
    
    
    
    
    
    
    9,115Government and government agenciesUnited States
    
    
    3,194
    
    
    
    1
    
    
    
    (61
    )
    
    
    
    
    
    
    3,134Foreign
    
    
    3,540
    
    
    
    92
    
    
    
    (180
    )
    
    
    
    
    
    
    3,452Total fixed maturity securities
    
    $
    110,939
    
    
    $
    4,636
    
    
    $
    (1,648
    )
    
    $
    
    
    
    $
    113,927Equity securities  preferred stocksBanking securities
    
    $
    80
    
    
    $
    
    
    
    $
    (23
    )
    
    $
    
    
    
    $
    57Total equity securities
    
    $
    80
    
    
    $
    
    
    
    $
    (23
    )
    
    $
    
    
    
    $
    57
 
 (1)
    
    Subsequent unrealized gains (losses) on OTTI securities are included in OCI-OTTI. 65




---



##### 



December 31, 2008EstimatedAmortized
    
    
    Gross Unrealized
    
    
    
    
    
    
    FairCost
    
    
    Gains
    
    
    Losses
    
    
    OTTI
    
    
    ValueFixed maturity securitiesCorporate securities
    
    $
    78,355
    
    
    $
    642
    
    
    $
    (6,632
    )
    
    $
    
    
    
    $
    72,365Asset-backed securities
    
    
    7,571
    
    
    
    19
    
    
    
    (793
    )
    
    
    
    
    
    
    6,797Commercial mortgage-backed securities
    
    
    24,802
    
    
    
    
    
    
    
    (4,979
    )
    
    
    
    
    
    
    19,823Residential mortgage-backed securities
    
    
    11,008
    
    
    
    157
    
    
    
    (589
    )
    
    
    
    
    
    
    10,576Government and government agenciesUnited States
    
    
    2,200
    
    
    
    116
    
    
    
    
    
    
    
    
    
    
    
    2,316Foreign
    
    
    4,050
    
    
    
    167
    
    
    
    (260
    )
    
    
    
    
    
    
    3,957Total fixed maturity securities
    
    $
    127,986
    
    
    $
    1,101
    
    
    $
    (13,253
    )
    
    $
    
    
    
    $
    115,834Equity securities  preferred stocksBanking securities
    
    $
    80
    
    
    $
    
    
    
    $
    (45
    )
    
    $
    
    
    
    $
    35Other financial services securities
    
    
    177
    
    
    
    
    
    
    
    (49
    )
    
    
    
    
    
    
    128Total equity securities
    
    $
    257
    
    
    $
    
    
    
    $
    (94
    )
    
    $
    
    
    
    $
    163
   December 31, 2009
    
    
    December 31, 2008Estimated
    
    
    
    
    
    
    EstimatedAmortized
    
    
    Fair
    
    
    Amortized
    
    
    FairCost
    
    
    Value
    
    
    Cost
    
    
    ValueInvestment grade
    
    $
    105,980
    
    
    $
    109,074
    
    
    $
    120,799
    
    
    $
    110,412Below investment grade
    
    
    4,959
    
    
    
    4,853
    
    
    
    7,187
    
    
    
    5,422Total fixed maturity securities
    
    $
    110,939
    
    
    $
    113,927
    
    
    $
    127,986
    
    
    $
    115,834
   December 31, 2009
    
    December 31, 2008Estimated
    
    
    
    
    
    EstimatedAmortized
    
    Fair
    
    Amortized
    
    FairCost
    
    Value
    
    Cost
    
    ValueFixed maturity securitiesDue in one year or less
    
    $
    4,486
    
    
    $
    4,511
    
    
    $
    10,392
    
    
    $
    10,373Due after one year through five years
    
    
    18,774
    
    
    
    19,517
    
    
    
    25,519
    
    
    
    24,166Due after five years through ten years
    
    
    37,584
    
    
    
    40,129
    
    
    
    39,921
    
    
    
    37,053Due after ten years
    
    
    8,103
    
    
    
    7,912
    
    
    
    8,773
    
    
    
    7,04668,947
    
    
    
    72,069
    
    
    
    84,605
    
    
    
    78,638Mortgage-backed securities and other asset-backed securities
    
    
    41,992
    
    
    
    41,858
    
    
    
    43,381
    
    
    
    37,196Total fixed maturity securities
    
    $
    110,939
    
    
    $
    113,927
    
    
    $
    127,986
    
    
    $
    115,834
 66




---



##### 



Unrealized Gains (Losses) on Fixed Maturity and Equity Securities
   December 31, 2009GrossEstimated
    
    
    
    
    
    
    UnrealizedFair
    
    
    Amortized
    
    
    Losses andValue
    
    
    Cost
    
    
    OTTI (1)Less than or equal to six monthsFixed maturitiesCorporate securities
    
    $
    998
    
    
    $
    998
    
    
    $
    Residential mortgage-backed securities
    
    
    35
    
    
    
    35
    
    
    
    Government and government agenciesUnited States
    
    
    1,883
    
    
    
    1,883
    
    
    
    Foreign
    
    
    2,193
    
    
    
    2,281
    
    
    
    (88
    )Total fixed maturity and equity securities
    
    
    5,109
    
    
    
    5,197
    
    
    
    (88
    )Greater than six months but less than or equal to one yearFixed maturitiesCorporate securities
    
    
    281
    
    
    
    315
    
    
    
    (34
    )Asset-backed securities
    
    
    653
    
    
    
    690
    
    
    
    (37
    )Government and government agencies  United States
    
    
    1,000
    
    
    
    1,061
    
    
    
    (61
    )Total fixed maturity and equity securities
    
    
    1,934
    
    
    
    2,066
    
    
    
    (132
    )Greater than one yearFixed maturitiesCorporate securities
    
    
    4,273
    
    
    
    4,578
    
    
    
    (305
    )Asset-backed securities
    
    
    1,563
    
    
    
    1,731
    
    
    
    (168
    )Commercial mortgage-backed securities
    
    
    5,955
    
    
    
    6,579
    
    
    
    (624
    )Residential mortgage-backed securities
    
    
    908
    
    
    
    1,148
    
    
    
    (240
    )Government and government agencies  foreign
    
    
    368
    
    
    
    459
    
    
    
    (91
    )Equity securities  banking securities
    
    
    57
    
    
    
    80
    
    
    
    (23
    )Total fixed maturity and equity securities
    
    
    13,124
    
    
    
    14,575
    
    
    
    (1,451
    )Total fixed maturity and equity securities
    
    $
    20,167
    
    
    $
    21,838
    
    
    $
    (1,671
    )
 
 (1)
    
    Subsequent unrealized gains (losses) on OTTI securities are included in OCI-OTTI. 67




---



##### 



December 31, 2008GrossEstimated
    
    
    
    
    
    
    UnrealizedFair
    
    
    Amortized
    
    
    Losses andValue
    
    
    Cost
    
    
    OTTILess than or equal to six monthsFixed maturitiesCorporate securities
    
    $
    31,552
    
    
    $
    35,444
    
    
    $
    (3,892
    )Asset-backed securities
    
    
    6,090
    
    
    
    6,883
    
    
    
    (793
    )Commercial mortgage-backed securities
    
    
    18,913
    
    
    
    22,923
    
    
    
    (4,010
    )Residential mortgage-backed securities
    
    
    1,506
    
    
    
    1,630
    
    
    
    (124
    )Government and government agencies  foreign
    
    
    998
    
    
    
    1,258
    
    
    
    (260
    )Equity securities  banking securities
    
    
    35
    
    
    
    80
    
    
    
    (45
    )Total fixed maturity and equity securities
    
    
    59,094
    
    
    
    68,218
    
    
    
    (9,124
    )Greater than six months but less than or equal to one yearFixed maturitiesCorporate securities
    
    
    14,976
    
    
    
    17,716
    
    
    
    (2,740
    )Commercial mortgage-backed securities
    
    
    910
    
    
    
    1,879
    
    
    
    (969
    )Residential mortgage-backed securities
    
    
    888
    
    
    
    1,353
    
    
    
    (465
    )Equity securities  other financial services securities
    
    
    128
    
    
    
    177
    
    
    
    (49
    )Total fixed maturity and equity securities
    
    
    16,902
    
    
    
    21,125
    
    
    
    (4,223
    )Total fixed maturity and equity securities
    
    $
    75,996
    
    
    $
    89,343
    
    
    $
    (13,347
    )
   December 31, 2009Estimated
    
    
    GrossFair
    
    
    Unrealized
    
    
    
    
    
    
    Number ofValue
    
    
    Losses
    
    
    OTTI
    
    
    SecuritiesDecline > 20%Greater than one year
    
    $
    2,407
    
    
    $
    (714
    )
    
    $
    
    
    
    
    4Total
    
    $
    2,407
    
    
    $
    (714
    )
    
    $
    
    
    
    
    4
 December 31, 2008Estimated
    
    
    GrossFair
    
    
    Unrealized
    
    
    
    
    
    
    Number ofValue
    
    
    Losses
    
    
    OTTI
    
    
    SecuritiesDecline > 20%Less than or equal to six months
    
    $
    10,963
    
    
    $
    (3,982
    )
    
    $
    
    
    
    
    16Greater than six months but less than or equal to one year
    
    
    4,261
    
    
    
    (3,570
    )
    
    
    
    
    
    
    15Total
    
    $
    15,224
    
    
    $
    (7,552
    )
    
    $
    
    
    
    
    31Decline > 40%Less than or equal to six months
    
    $
    1,431
    
    
    $
    (1,341
    )
    
    $
    
    
    
    
    6Greater than six months but less than or equal to one year
    
    
    2,673
    
    
    
    (2,763
    )
    
    
    
    
    
    
    9Total
    
    $
    4,104
    
    
    $
    (4,104
    )
    
    $
    
    
    
    
    15
  68




---



##### 



December 312009
    
    
    2008AssetsFixed maturity securities
    
    $
    2,987
    
    
    $
    (12,152
    )Equity securities
    
    
    (23
    )
    
    
    (94
    )Deferred policy acquisitions costs
    
    
    
    
    
    
    (38
    )Value of business acquired
    
    
    (62
    )
    
    
    (454
    )2,902
    
    
    
    (12,738
    )LiabilitiesPolicyholder account balances
    
    
    251
    
    
    
    (83
    )Federal income taxes  deferred
    
    
    (1,103
    )
    
    
    4,488(852
    )
    
    
    4,405Stockholders equityAccumulated other comprehensive income (loss), net of taxes
    
    $
    2,050
    
    
    $
    (8,333
    )
  Policy Loans
  Derivatives
  Net Investment Income
  Successor
    
    
    
    Predecessor2009
    
    
    2008
    
    
    
    2007Fixed maturity securities
    
    $
    6,731
    
    
    $
    6,326
    
    
    
    $
    5,727Policy loans on insurance contracts
    
    
    3,180
    
    
    
    3,279
    
    
    
    
    3,385Cash and cash equivalents
    
    
    178
    
    
    
    1,638
    
    
    
    
    2,300Equity securities
    
    
    12
    
    
    
    38
    
    
    
    
    71Other
    
    
    
    
    
    
    
    
    
    
    
    12Gross investment income
    
    
    10,101
    
    
    
    11,281
    
    
    
    
    11,495Less investment expenses
    
    
    (201
    )
    
    
    (215
    )
    
    
    
    (249
    )Net investment income
    
    $
    9,900
    
    
    $
    11,066
    
    
    
    $
    11,246
 69




---



##### 



Realized Investment Gains (Losses)
  Successor
    
    
    Predecessor2009
    
    2008
    
    
    2007Proceeds
    
    $
    28,544
    
    
    $
    32,068
    
    
    
    $
    12,210Gross realized investment gains
    
    
    564
    
    
    
    461
    
    
    
    
    1,268Gross realized investment losses
    
    
    (735
    )
    
    
    (481
    )
    
    
    
    (127
    )Proceeds on available-for-sale securities sold at a realized loss
    
    
    7,878
    
    
    
    18,277
    
    
    
    
    7,619
  Successor
    
    
    
    Predecessor2009
    
    
    2008
    
    
    
    2007Fixed maturity securities
    
    $
    (904
    )
    
    $
    (628
    )
    
    
    $
    1,141Equity securities
    
    
    (177
    )
    
    
    (15
    )
    
    
    
    Derivatives
    
    
    (1,849
    )
    
    
    1,273
    
    
    
    
    Associated amortization expense of VOBA
    
    
    (33
    )
    
    
    152
    
    
    
    
    Net realized investment gains (losses)
    
    $
    (2,963
    )
    
    $
    782
    
    
    
    $
    1,141
 OTTI
   Balance, December 31, 2008
    
    $
    Credit losses remaining in retained earnings related to adoption of
revised guidance on OTTI (ASC 320)
    
    
    69Credit loss impairments previously recognized on securities which
matured, paid down, prepaid or were sold during the period
    
    
    (69
    )Accretion of credit loss impairments previously recognized
    
    
    (2
    )Accretion of credit loss impairments previously recognized due to an
increase in cash flows expected to be collected
    
    
    (1
    )Accretion previously recognized on securities which matured, paid down,
prepaid or were sold during the period
    
    
    3Balance, December 31, 2009
    
    $
    
  70




---



##### 



Note 5. VOBA, Other Intangibles and Goodwill
   2009
    
    
    2008Balance at beginning of year
    
    $
    41,525
    
    
    $
    44,024Purchase price adjustment
    
    
    
    
    
    
    6,829Amortization expense
    
    
    (3,116
    )
    
    
    (2,239
    )Unlocking
    
    
    (519
    )
    
    
    (2,460
    )Impairment charge
    
    
    (7,165
    )
    
    
    (4,326
    )Adjustment related to realized (gains) losses on investments and OTTI
    
    
    (33
    )
    
    
    152Adjustment
related to unrealized (gains) losses and OTTI on investments
    
    
    290
    
    
    
    (454
    )Balance at end of year
    
    $
    30,982
    
    
    $
    41,525
   2010
    
    $
    2,9892011
    
    $
    2,8252012
    
    $
    2,6282013
    
    $
    2,5062014
    
    $
    2,387
 th
 Note 6. DAC, DSI and UPCR
  71




---



##### 



DAC
    
    
    DSIBalance, January 1, 2008
    
    $
    
    
    
    $
    Capitalization
    
    
    442
    
    
    
    177Accretion
    
    
    11
    
    
    
    1Unlocking
    
    
    (42
    )
    
    
    (13
    )Adjustment related to unrealized gains and OTTI on investments
    
    
    (38
    )
    
    
    Balance, December 31, 2008
    
    
    373
    
    
    
    165Capitalization
    
    
    65
    
    
    
    5Amortization
    
    
    (139
    )
    
    
    (53
    )Unlocking
    
    
    22
    
    
    
    13Adjustment related to unrealized losses and OTTI on investments
    
    
    39
    
    
    
    Balance, December 31, 2009
    
    $
    360
    
    
    $
    130
  Note 7. Variable Contracts Containing Guaranteed Benefits
 Variable Annuity Contracts Containing Guaranteed Benefits
  
    
    In general, contracts containing GMDB provisions provide a death benefit equal to the
greater of the GMDB or the contract value. Depending on the type of contract, the GMDB may
equal: i) contract deposits accumulated at a specified interest rate, ii) the contract
value on specified contract anniversaries, iii) return of contract deposits, or iv) some
combination of these benefits. Each benefit type is reduced for contract withdrawals.
    
    In general, contracts containing GMIB provisions provide the option to receive a
guaranteed future income stream upon annuitization. There is a waiting period of ten years
that must elapse before the GMIB provision can be exercised.
    
    Contracts containing GMWB provisions provide the contract owner the ability to withdraw
minimum annual payments regardless of the impact of market performance on the contract
owners account value. In general, withdrawal percentages are based on the contract
owners age at the time of the first withdrawal.
 72




---



##### 



GMDB
    
    GMIB
    
    GMWB2009Net amount at risk (a)
    
    $
    84,102
    
    
    $
    337
    
    
    $
    4,871Average attained age of contract owners
    
    
    71
    
    
    
    62
    
    
    
    73Weighted average period remaining until expected annuitization
    
    
    n/a
    
    
    4.0
    yrs
    
    
    n/a2008Net amount at risk (a)
    
    $
    167,799
    
    
    $
    7,321
    
    
    $
    11,327Average attained age of contract owners
    
    
    69
    
    
    
    62
    
    
    
    73Weighted average period remaining until expected annuitization
    
    
    n/a
    
    
    6.1
    yrs
    
    
    n/a
 
 (a)
    
    Net amount at risk for GMDB is defined as the current GMDB in excess of the
contract owners account balance at the Balance Sheet date. Net amount at risk for
GMIB is defined as the present value of the minimum guaranteed annuity payments
available to the contract owner in excess of the contract owners account balance at
the Balance Sheet date. Net amount at risk for GMWB is defined as the present value
of the minimum guaranteed withdrawals available to the contract owner in excess of the
contract owners account balance at the Balance Sheet date.   GMDB
    
    
    GMIBBalance, January 1, 2008
    
    $
    2,221
    
    
    $
    Purchase price adjustment
    
    
    (2,221
    )
    
    
    Guaranteed benefits incurred
    
    
    1,127
    
    
    
    491Guaranteed benefits paid
    
    
    (2,307
    )
    
    
    Unlocking
    
    
    1,677
    
    
    
    626Balance, December 31, 2008
    
    
    497
    
    
    
    1,117Guaranteed benefits incurred
    
    
    2,301
    
    
    
    1,262Guaranteed benefits paid
    
    
    (2,488
    )
    
    
    Unlocking
    
    
    (3
    )
    
    
    167Balance, December 31, 2009
    
    $
    307
    
    
    $
    2,546
  73




---



##### 



MoneyEquity
    
    
    Bond
    
    
    Balanced
    
    
    Market
    
    
    Other
    
    
    Total2009GMDB Only
    
    $
    159,327
    
    
    $
    63,585
    
    
    $
    42,961
    
    
    $
    18,679
    
    
    $
    155
    
    
    $
    284,707GMDB and GMIB
    
    
    82,236
    
    
    
    22,879
    
    
    
    25,241
    
    
    
    4,378
    
    
    
    1,030
    
    
    
    135,764GMDB and GMWB
    
    
    10,395
    
    
    
    1,979
    
    
    
    4,567
    
    
    
    25
    
    
    
    167
    
    
    
    17,133GMWB only
    
    
    10,972
    
    
    
    2,066
    
    
    
    4,269
    
    
    
    223
    
    
    
    270
    
    
    
    17,800GMIB only
    
    
    4,117
    
    
    
    941
    
    
    
    1,276
    
    
    
    46
    
    
    
    84
    
    
    
    6,464No guaranteed benefit
    
    
    1,957
    
    
    
    721
    
    
    
    1,515
    
    
    
    222
    
    
    
    39
    
    
    
    4,454Total
    
    $
    269,004
    
    
    $
    92,171
    
    
    $
    79,829
    
    
    $
    23,573
    
    
    $
    1,745
    
    
    $
    466,3222008GMDB Only
    
    $
    147,508
    
    
    $
    63,836
    
    
    $
    40,367
    
    
    $
    18,950
    
    
    $
    104
    
    
    $
    270,765GMDB and GMIB
    
    
    64,741
    
    
    
    24,476
    
    
    
    24,035
    
    
    
    4,896
    
    
    
    699
    
    
    
    118,847GMDB and GMWB
    
    
    7,489
    
    
    
    2,277
    
    
    
    4,526
    
    
    
    20
    
    
    
    170
    
    
    
    14,482GMWB only
    
    
    7,949
    
    
    
    2,463
    
    
    
    4,661
    
    
    
    109
    
    
    
    249
    
    
    
    15,431GMIB only
    
    
    3,489
    
    
    
    789
    
    
    
    1,230
    
    
    
    20
    
    
    
    68
    
    
    
    5,596No guaranteed benefit
    
    
    1,725
    
    
    
    440
    
    
    
    1,000
    
    
    
    160
    
    
    
    37
    
    
    
    3,362Total
    
    $
    232,901
    
    
    $
    94,281
    
    
    $
    75,819
    
    
    $
    24,155
    
    
    $
    1,327
    
    
    $
    428,483
 Variable Life Contracts Containing Guaranteed Benefits
   2009
    
    
    2008Balanced
    
    $
    80,251
    
    
    $
    53,440Equity
    
    
    48,770
    
    
    
    74,664Bond
    
    
    23,936
    
    
    
    12,799Money Market
    
    
    24,870
    
    
    
    29,052Total
    
    $
    177,827
    
    
    $
    169,955
 Note 8. Federal Income Taxes
  74




---



##### 



Successor
    
    
    
    Predecessor2009
    
    
    2008
    
    
    
    2007Provisions for income taxes computed
at Federal statutory rate (35%)
    
    $
    (1,905
    )
    
    $
    (1,671
    )
    
    
    $
    5,411Increase (decrease) in income taxes resulting from:Dividend received deduction
    
    
    (700
    )
    
    
    (595
    )
    
    
    
    (407
    )Tax credits
    
    
    (151
    )
    
    
    (72
    )
    
    
    
    (156
    )Tax goodwill amortization
    
    
    
    
    
    
    (128
    )
    
    
    
    Valuation allowance on deferred tax assets
    
    
    3,705
    
    
    
    
    
    
    
    
    Provision to return adjustment
    
    
    (608
    )
    
    
    
    
    
    
    
    Uncertain tax positions
    
    
    343
    
    
    
    
    
    
    
    
    Other
    
    
    53
    
    
    
    2
    
    
    
    
    Federal income tax provision
    
    $
    737
    
    
    $
    (2,464
    )
    
    
    $
    4,848Effective tax rate
    
    
    -14
    %
    
    
    53
    %
    
    
    
    31
    %
  December 312009
    
    
    2008Deferred tax assetsDAC
    
    $
    11,362
    
    
    $
    10,155Tax VOBA
    
    
    668
    
    
    
    719Policyholder account balances
    
    
    14,871
    
    
    
    Tax credits
    
    
    629
    
    
    
    Investment adjustments
    
    
    
    
    
    
    5,227Net operating and capital loss carryforward
    
    
    2,487
    
    
    
    3,724Intangible assets
    
    
    3,464
    
    
    
    3,123Other
    
    
    705
    
    
    
    111Total deferred tax assets
    
    
    34,186
    
    
    
    23,059Valuation allowance
    
    
    (3,705
    )
    
    
    Net deferred tax assets
    
    
    30,481
    
    
    
    23,059Deferred tax liabilitiesBook VOBA
    
    
    10,866
    
    
    
    14,534DAC
    
    
    2,456
    
    
    
    188Investment adjustments
    
    
    17,777
    
    
    
    Policyholder account balance
    
    
    
    
    
    
    3,154Total deferred tax liabilities
    
    
    31,099
    
    
    
    17,876Total net deferred tax asset (liability)
    
    $
    (618
    )
    
    $
    5,183
  Income Taxes,
 75




---



##### 



Note
9. Stockholders Equity and Statutory Accounting Principles
     Note 10. Reinsurance
   76




---



##### 



PercentageCeded to
    
    Assumed
    
    
    
    
    
    of amountGross
    
    other
    
    from other
    
    Net
    
    assumed toamount
    
    companies
    
    companies
    
    amount
    
    netLife insurance inforce
    
    $
    429,011
    
    
    $
    49,966
    
    
    $
    1,175
    
    
    $
    380,220
    
    
    
    0.31
    %
  Note 11. Related Party Transactions
           77




---



##### 



Note 12. Commitments and Contingencies
  78




---



##### 



Note 13. Segment Information
   Successor2009LifeAnnuity
    
    Insurance
    
    TotalNet revenues (a)
    
    $
    9,306
    
    
    $
    5,808
    
    
    $
    15,114Policy benefits (net of reinsurance)
    
    
    1,888
    
    
    
    1,390
    
    
    
    3,278Federal income tax expense
    
    
    99
    
    
    
    638
    
    
    
    737Net income (loss)
    
    
    (7,650
    )
    
    
    1,469
    
    
    
    (6,181
    )
 Successor2008LifeAnnuity
    
    Insurance
    
    TotalNet revenues (a)
    
    $
    15,527
    
    
    $
    8,672
    
    
    $
    24,199Policy benefits (net of reinsurance)
    
    
    972
    
    
    
    1,653
    
    
    
    2,625Federal income tax expense (benefit)
    
    
    (2,997
    )
    
    
    533
    
    
    
    (2,464
    )Net income (loss)
    
    
    (3,996
    )
    
    
    1,783
    
    
    
    (2,213
    )
 79




---



##### 



Predecessor2007LifeAnnuity
    
    Insurance
    
    Other
    
    TotalNet revenues (a)
    
    $
    16,130
    
    
    $
    7,252
    
    
    $
    2,144
    
    
    $
    25,526Policy benefits (net of reinsurance)
    
    
    (124
    )
    
    
    2,193
    
    
    
    
    
    
    
    2,069Federal income tax expense
    
    
    3,199
    
    
    
    898
    
    
    
    751
    
    
    
    4,848Net income
    
    
    7,278
    
    
    
    1,940
    
    
    
    1,393
    
    
    
    10,611
 
 (a)
    
    Net revenues include total revenues net of interest credited to policyholder
liabilities.  TotalTotal
    
    
    PolicyholderAssets
    
    
    Liabilities2009Annuity
    
    $
    622,440
    
    
    $
    74,177Life Insurance
    
    
    287,310
    
    
    
    71,556Total
    
    $
    909,750
    
    
    $
    145,7332008Annuity
    
    $
    550,783
    
    
    $
    80,497Life Insurance
    
    
    319,057
    
    
    
    76,533Total
    
    $
    869,840
    
    
    $
    157,030
 80




---



##### 



SIGNATURES

Pursuant to the requirements
of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has
duly caused this report to be signed on its behalf by the undersigned, thereunto
duly authorized.

|                     |  |                                                   |                                                                       
|-------------------- |  | ------------------------------------------------- | ----------------------------------------------------------------------
|                     |  | ML Life Insurance Company of New York(Registrant)
|                    
|Date:
March 25, 2010 |  | By:                                               | *                                                                     
|                     |  |                                                   | James D. Purvis
Vice President, Treasurer,
and Chief Financial Officer

Pursuant to the requirements of the
Securities Exchange Act of 1934, this Report has been signed below by the following
persons on behalf of the registrant and in the capacities and on the dates indicated.

Signatures
    
    Title
    
    Date*

Lon J. Olejniczak
    
    Director and President
    
    March 25, 2010*

William Brown, Jr.
    
    Director
    
    March 25, 2010*

William L. Busler
    
    Director
    
    March 25, 2010*

Frank A. Camp
    
    Director and Secretary
    
    March 25, 2010*

Robert R. Frederick
    
    Director and Senior
Vice President
    
    March 25, 2010*

Steven E. Frushtick
    
    Director
    
    March 25, 2010*

John T. Mallett
    
    Director and Vice President
    
    March 25, 2010*

Ronald F. Mosher
    
    Director
    
    March 25, 2010*

Cornelius H. Verhagen
    
    Director
    
    March 25, 2010*

Ronald L. Ziegler
    
    Director and Senior
Vice President
    
    March 25, 2010*

James D. Purvis
    
    Vice President, Treasurer,
and Chief Financial Officer
    
    March 25, 2010*

Eric J. Martin
    
    Vice President and
Corporate Controller
    
    March 25, 2010/s/ Darin D. Smith

Darin D. Smith
    
    Vice President and
Assistant Secretary
    
    March 25, 2010





|     |  |                                                                  
|---- |  | -----------------------------------------------------------------
|*By: |  | Darin D. Smith  Attorney-in-Fact pursuant to Powers of Attorney.

81



---



##### 



SUPPLEMENTAL INFORMATION TO BE FURNISHED WITH REPORTS FILED PURSUANT TO SECTION
15(d) OF THE ACT BY REGISTRANTS WHICH HAVE NOT REGISTERED SECURITIES PURSUANT TO
SECTION 12 OF THE ACT.

|                                                                                                                                      
|--------------------------------------------------------------------------------------------------------------------------------------
|No annual report covering the Registrants last fiscal year or proxy
material has been or will be sent to Registrants security holder

82



---



##### 



EXHIBIT INDEX

|            |  |                                                                                  |  |                                                                                                                                                                                                               
|----------- |  | -------------------------------------------------------------------------------- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Exhibit No. |  | Description                                                                      |  | Location                                                                                                                                                                                                      
|            |  |                                                                                  |  |                                                                                                                                                                                                               
|3.1         |  | Certificate of Amendment of the Charter of
ML Life Insurance Company of New York |  | Incorporated by reference to Exhibit
6(a)(ii) to Post-Effective Amendment No.
10 to ML of New York Variable Annuity
Account As registration statement on Form
N-4, File No. 33-43654, filed December 9,
1996.
|3.2         |  | By-Laws of ML Life Insurance Company of
New York                                 |  | Incorporated by reference to Exhibit 6(b)
to Post-Effective Amendment No. 10 to ML
of New York Variable Annuity Account As
registration statement on Form N-4, File
No. 33-43654, filed December 9, 1996.    
|4.1         |  | Modified Guaranteed Annuity Contract                                             |  | Incorporated by reference to Exhibit 4(a)
to Pre-Effective Amendment No. 1 to the
Registrants registration statement on
Form S-1, File No. 33-34562, filed October
16, 1990.                                 
|4.2         |  | Modified Guaranteed Annuity Contract
Application                                 |  | Incorporated by reference to Exhibit 4(b)
to Pre-Effective Amendment No. 1 to the
Registrants registration statement on
Form S-1, File No. 33-34562, filed October
16, 1990.                                 
|4.3         |  | Qualified Retirement Plan Endorsement                                            |  | Incorporated by reference to Exhibit 4(c)
to Pre-Effective Amendment No. 1 to the
Registrants registration statement on
Form S-1, File No. 33-34562, filed
October 16, 1990.                                 
|4.4         |  | IRA Endorsement                                                                  |  | Incorporated by reference to Exhibit 4(d)
to Pre-Effective Amendment No. 1 to the
Registrants registration statement on
Form S-1, File No. 33-34562, filed October
16, 1990.                                 

E-1



---



##### 



|     |  |                                                                                                                                                                               |  |                                                                                                                                                                                                          
|---- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|4.5  |  | Company Name Change Endorsement                                                                                                                                               |  | Incorporated by reference to
        Exhibit 4(e) to Post-Effective Amendment No. 3 to the Registrants
        registration statement on Form S-1, File No. 33-34562, filed
        March 30, 1992.     
|4.6  |  | IRA Endorsement, MLNY009                                                                                                                                                      |  | Incorporated by reference to
        Exhibit 4(d)(2) to Post-Effective Amendment No. 1 to the Registrants
        registration statement on Form S-1, File No. 33-60288, filed
        March 31, 1994.  
|4.7  |  | Modified Guaranteed Annuity
        Contract
        MLNY-AY-991/94                                                                                                           |  | Incorporated by reference to
        Exhibit 4(a)(2) to Post-Effective Amendment No. 3 to the Registrants
        registration statement on Form S-1, File No. 33-60288, filed
        December 7, 1994.
|4.8  |  | Qualified Retirement Plan
        Endorsement 
        MLNY-AYQ-991/94                                                                                                        |  | Incorporated by reference to
        Exhibit 4(c)(2) to Post-Effective Amendment No. 3 to the Registrants
        registration statement on Form S-1, File No. 33-60288, filed
        December 7, 1994.
|10.1 |  | General Agency Agreement between
        Royal Tandem Life Insurance Company and Merrill Lynch Life Agency Inc.                                                               |  | Incorporated by reference to
        Exhibit 10(a) to Pre-Effective Amendment No. 1 to the Registrants
        registration statement on Form S-1, File No. 33-34562, filed
        October 16, 1990.   
|10.2 |  | Investment Management Agreement
        by and between Royal Tandem Life Insurance Company and Equitable Capital
        Management Corporation                               |  | Incorporated by reference to
        Exhibit 10(b) to Pre-Effective Amendment No. 1 to the Registrants
        registration statement on Form S-1, File No. 33-34562, filed
        October 16, 1990.   
|10.3 |  | Shareholders Agreement
        by and among The Equitable Life Assurance Society of the United States
        and Merrill Lynch & Co., Inc. and Tandem Financial Group, Inc. |  | Incorporated by reference to
        Exhibit 10(c) to Pre- Effective Amendment No. 1 to the Registrants
        registration statement on Form S-1, File No. 33-34562, filed
        October 16, 1990.  

E-2



---



##### 



|      |  |                                                                                                                                                                                       |  |                                                                                                                                                                               
|----- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|10.4  |  | Service Agreement by and between Royal
Tandem Life Insurance Company and Tandem
Financial Group, Inc.                                                                                 |  | Incorporated by reference to Exhibit 10(d)
to Pre-Effective Amendment No. 1 to the
Registrants registration statement on
Form S-1, File No. 33-34562, filed October
16, 1990.
|10.5  |  | Service Agreement by and between Tandem
Financial Group, Inc. and Merrill Lynch
&
Co., Inc.                                                                                           |  | Incorporated by reference to Exhibit 10(e)
to Pre-Effective Amendment No. 1 to the
Registrants registration statement on
Form S-1, File No. 33-34562, filed October
16, 1990.
|10.6  |  | Form of Investment Management Agreement by
and between Royal Tandem Life Insurance
Company and Merrill Lynch Asset
Management, Inc.                                                   |  | Incorporated by reference to Exhibit 10(f)
to Post-Effective Amendment No. 1 to the
Registrants registration statement on
Form S-1, File No. 33-34562, filed March
7, 1991.  
|10.7  |  | Assumption Reinsurance Agreement between
Merrill Lynch Life Insurance Company,
Tandem Insurance Group, Inc. and Royal
Tandem Life Insurance Company and Family
Life Insurance Company |  | Incorporated by reference to Exhibit 10(g)
to Post-Effective Amendment No. 3 to the
Registrants registration statement on
Form S-1, File No. 33-34562, filed March
30, 1992. 
|10.8  |  | Indemnity Agreement between ML Life
Insurance Company of New York and Merrill
Lynch Life Agency, Inc.                                                                                 |  | Incorporated by reference to Exhibit 10(h)
to Post-Effective Amendment No. 3 to the
Registrants registration statement on
Form S-1, File No. 33-34562, filed March
30, 1992. 
|10.9  |  | Amended General Agency Agreement between
ML Life Insurance Company of New York and
Merrill Lynch Life Agency, Inc.                                                                    |  | Incorporated by reference to Exhibit 10(i)
to Post-Effective Amendment No. 3 to the
Registrants registration statement on
Form S-1, File No. 33-34562, filed March
30, 1992. 
|10.10 |  | Amended Management Agreement between ML
Life Insurance Company of New York and
Merrill Lynch Asset Management, Inc.                                                                   |  | Incorporated by reference to Exhibit 10(j)
to the Registrants registration statement
on Form S-1, File No. 33-60288, filed March
30, 1993.                                   

E-3



---



##### 



|      |  |                                                                                                                                                                                      |  |                                                                                                                                                                          
|----- |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ |  | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|10.11 |  | Mortgage Loan Servicing Agreement between
ML Life Insurance Company of New York and
Merrill Lynch & Co., Inc.                                                                        |  | Incorporated by reference to Exhibit 10(k)
to the Registrants registration statement
on Form S-1, File No. 33-60288, filed
March 29, 1995.                              
|10.12 |  | Master Distribution Agreement between Merrill
Lynch Insurance Group, Inc., Merrill Lynch & Co., Inc., and AEGON USA, Inc.                                                            |  | Incorporated by reference to Exhibit 10.1 to
Registrants Current Report on Form 8-K, File No. 33-34562, filed January 4, 2008.                                          
|     
|10.13 |  | Non-Affiliated Broker-Dealer Wholesaling
Agreement between ML Life Insurance Company of New York, Merrill Lynch, Pierce, Fenner & Smith
Incorporated, and Transamerica Capital, Inc. |  | Incorporated by reference to Exhibit 10.13 to the
Registrants Annual Report on Form 10-K, File Nos. 33-34562, 33-60288, 333-48983, and 333-133224,
filed March 27, 2008.
|     
|10.14 |  | Selling Agreement between ML Life Insurance Company of New York, Merrill Lynch, Pierce, Fenner & Smith Incorporated, and Merrill Lynch Life Agency, Inc.                             |  | Incorporated by reference to Exhibit 10.14 to the
Registrants Annual Report on Form 10-K, File Nos. 33-34562, 33-60288, 333-48983, and 333-133224,
filed March 27, 2008.
|     
|10.15 |  | Keep Well Agreement between AEGON USA And ML Life Insurance Company of New York                                                                                                      |  | Incorporated by reference to Exhibit 10.15 to the
Registrants Annual Report on Form 10-K, File Nos. 33-34562, 33-60288, 333-48983, and 333-133224,
filed March 27, 2008.
|     
|10.16 |  | Purchase Agreement between Merrill Lynch
Insurance Group, Inc., Merrill Lynch & Co., Inc., and AEGON USA, Inc.                                                                       |  | Incorporated by reference to Exhibit 10.1 to
Registrants Current Report on Form 8-K, File No. 33-34562, filed August 17, 2007.                                          
|     
|10.17 |  | First Amendment to Purchase Agreement between Merrill
Lynch Insurance Group, Inc., Merrill Lynch & Co., Inc., and AEGON USA, Inc.                                                    |  | Incorporated by reference to Exhibit 10.1 to
Registrants Current Report on Form 8-K, File No. 33-34562, filed January 4, 2008.                                          
|     
|10.18 |  | Principal Underwriting Agreement between
Transamerica Capital, Inc. and ML Life Insurance
Company of New York.                                                                       |  | Incorporated by reference to Exhibit 10.18 to the Registrants Annual Report on Form 10-K, File
Nos. 33-34562, 33-60288, 333-48983, and 333-133224, filed March 26, 2009.
|     
|24.1  |  | Powers of Attorney.                                                                                                                                                                  |  | Exhibit 24.1                                                                                                                                                             
|     
|31.1  |  | Certification by the Chief Executive Officer
pursuant to Rule 15d-14(a).                                                                                                             |  | Exhibit 31.1                                                                                                                                                             
|     
|31.2  |  | Certification by the Chief Financial Officer
pursuant to Rule 15d-14(a).                                                                                                             |  | Exhibit 31.2                                                                                                                                                             
|     
|32.1  |  | Certification by the Chief Executive Officer
pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act
of 2002.                               |  | Exhibit 32.1                                                                                                                                                             
|     
|32.2  |  | Certification by the Chief Financial Officer
pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act
of 2002.                               |  | Exhibit 32.2                                                                                                                                                             

E-4



---



##### 



EXHIBIT INDEX
 24.1
    
    Powers of Attorney31.1
    
    Certification by the Chief Executive Officer pursuant to Rule 15d-14(a).31.2
    
    Certification by the Chief Financial Officer pursuant to Rule 15d-14(a).32.1
    
    Certification by the Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002.32.2
    
    Certification by the Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002.