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                                                          Exhibit 10.3

AEtna                                     Aetna Inc.
                                          151 Farmington Avenue
                                          Hartford, CT  06156-3122


                                          Ronald E. Compton
                                          Chairman
                                          860-273-3087
                                          Fax:  860-273-6872


March 6, 1997




Mr. Joseph T. Sebastianelli




Dear Joe:

On behalf of the Aetna Board, I am pleased to offer you the position 
of President of Aetna on terms as set forth in the attached "Term 
Sheet" which is incorporated herein by reference.

If you agree to accept this position on the terms as set forth, please 
indicate your acceptance by signing below.


                                        Sincerely yours,




                                        /s/ Ronald E. Compton
                                        _____________________
                                        Ronald E. Compton




Accepted and Agreed:




/s/ Joseph T. Sebastianelli
___________________________
Joseph T. Sebastianelli




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                                   TERM SHEET


Definitions                        See Exhibit A

Employment Contract Term           March 6, 1997 through July 19, 2001

Position; Reporting Relationships  President of Aetna Inc. reporting 
                                   to Chief Executive Officer

Duties                             Supervise the following Business 
                                   Units:  Aetna U.S. Healthcare and 
                                   Aetna International.  These duties 
                                   will include liaison with Strategic 
                                   Planning.

                                   Supervise the following Staff 
                                   Units:  Human Resources, Corporate 
                                   Communications, Federal Government 
                                   Relations and Aetna Business 
                                   Resources.

                                   It is anticipated that over the 
                                   course of the first year of this 
                                   Term Sheet, Executive shall be 
                                   given additional duties and 
                                   responsibilities as specified from 
                                   time to time by the Chief Executive 
                                   Officer.

                                   Executive to devote substantially 
                                   all of his business time to 
                                   performance of duties under this 
                                   Term Sheet.

Office Location                    Hartford, Connecticut

Residence                          Establish residence immediately (as 
                                   soon as possible) in the greater 
                                   Hartford area.  Establish primary 
                                   residence in the greater Hartford 
                                   area on a date mutually agreeable 
                                   to Executive and the Company.

Cash Compensation                  Salary:  $725,000

                                   Incentive Compensation:  
                                   participation in annual and long-
                                   term incentive compensation 
                                   programs of the Company made 
                                   available to senior executives on a 
                                   basis commensurate with position.

Equity Based Compensation          Participation in all stock-based 
                                   compensation programs of the 
                                   Company made available to senior 
                                   executives on a basis commensurate 
                                   with position.




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Benefits                           Continued participation in all 
                                   benefit plans in which Executive 
                                   currently participates.

Effect of Termination of 
Employment

  - by Company without Cause,      Earned but unpaid amounts 
  by Executive with Good           (including pro rata target bonus), 
  Reason                           severance payments equal to 3x base 
                                   salary and target annual bonus, 
                                   continued benefits for 3 years, 
                                   continued vesting of equity awards 
                                   other than restricted stock award 
                                   for 1 year, accelerated vesting of 
                                   restricted stock award.

  - Death                          Continued payment of base salary 
                                   and annual bonus for one year.

  - Disability                     Continued payment of base salary 
                                   and annual bonus for one year, 
                                   offset by amounts paid under 
                                   Company's long-term disability
                                   program.

  - by Executive without Good      Payment of earned but unpaid 
    Reason, by Company for         amounts (exclusive of pro-rate
    Cause                          bonus) with respect to year of 
                                   termination.

Term Expiration                    If not offered CEO position on or 
                                   before February 28, 1998, and 
                                   Executive elects to leave Company 
                                   no later than February 28, 1999, 
                                   earned but unpaid amounts 
                                   (including 1997 bonus), severance 
                                   equal to 3x base salary and target 
                                   annual bonus, continued benefits 
                                   for 3 years, continued vesting of 
                                   equity awards other than restricted 
                                   stock award for 1 year, accelerated 
                                   vesting of restricted stock award.

Change of Control                  Gross-up for excise tax; provided 
                                   that if payments to Executive 
                                   exceed amount which can be paid 
                                   without incurring an excise tax by 
                                   less than 5%, the Company may 
                                   reduce amounts paid to Executive to 
                                   the maximum amount which may be 
                                   paid without incurring an excise 
                                   tax.









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Restrictive Covenants              Noncompetition:  During employment 
                                   term and for one year following 
                                   termination of employment 
                                   (including a termination under 
                                   circumstances described above in 
                                   "Term Expiration" which entitles 
                                   Executive to severance payments and 
                                   benefits but excluding a 
                                   termination without cause or for 
                                   good reason), Executive may not 
                                   become associated with an entity 
                                   actively engaged in any business 
                                   which is in competition with the 
                                   business or businesses of the 
                                   Company for which Executive 
                                   provides substantial services or 
                                   for which Executive has substantial 
                                   responsibility.

                                   Confidentiality:  During the 
                                   employment term and thereafter.

                                   Nonsolicitation:  During the 
                                   employment term and through 
                                   February 28, 2003, Executive may 
                                   not:  induce any employee, agent or 
                                   broker of the Company or any of its 
                                   subsidiaries or affiliates to 
                                   perform services elsewhere; induce 
                                   any agent or agency, broker, 
                                   broker-dealer, supplier or 
                                   healthcare provider of the Company 
                                   or any of its subsidiaries or 
                                   affiliates to cease providing 
                                   services; or solicit customers of 
                                   the Company or any of its 
                                   subsidiaries or affiliates.

Effect on Current Contract         The Agreement will supersede 
                                   Executive's current employment 
                                   contract in its entirety, including 
                                   without limitation, the requirement 
                                   that a notice of termination of 
                                   employment include a supermajority 
                                   resolution of the Board.  Executive 
                                   shall also waive his rights under 
                                   Section 7.11(c) of the Merger 
                                   Agreement.  The terms of his equity 
                                   awards (including his restricted 
                                   stock awards) granted under the 
                                   Company's long term stock incentive 
                                   plan shall be unaffected.

Successors                         The Company will require any 
                                   successor to the assets or business 
                                   of the Company to agree to assume 
                                   the agreement.

Governing Law                      Connecticut



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Dispute Resolution                 Binding arbitration in Hartford, 
                                   Connecticut; provided that the 
                                                ________          
                                   decision as to whether Executive 
                                   shall be promoted shall be made by 
                                   the Board, in its sole discretion, 
                                   and shall not be subject to dispute 
                                   resolution.

Legal Fees                         Fees and expenses of arbitration 
                                   borne equally by Executive and the 
                                   Company; provided that if Executive 
                                   prevails as to any material issue, 
                                   the entire cost (including 
                                   reasonable attorneys' fees) shall 
                                   be borne by the Company.










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                                                             EXHIBIT A


                              Definitions


"Termination for Cause" means a termination of Executive's employment 
by the Company due to (i) the willful failure by Executive to perform 
substantially Executive's duties as an employee of the company (other 
than due to physical or mental illness) after reasonable notice to 
Executive of such failure, (ii) Executive's engaged in serious 
misconduct that is injurious to the Company or any subsidiary or any 
affiliate of the Company, (iii) Executive's having been convicted of, 
or entered a plea of nolo contendere to, a crime involving an act that 
                     ____ __________                                   
is immoral or wrong in and of itself (e.g., burglary, larceny, murder 
                                      ____                            
or arson) or a crime involving deceit, fraud, perjury or embezzlement, 
(iv) the breach by Executive of any written covenant or agreement not 
to compete with the Company or any subsidiary or any affiliate or (v) 
                                                                   _  
the breach by Executive of his duty of loyalty to the Company which 
shall include, without limitation, (A) the disclosure by Executive of 
                                    _                                 
any confidential information pertaining to the Company or any 
subsidiary or any affiliate of the Company other than (x) in the 
                                                       _         
ordinary course of the performance of his duties on behalf of the 
Company or (y) pursuant to a judicial or administrative subpoena from 
            _                                                         
a court or governmental authority with jurisdiction over the matter in 
question, (B) the harmful interference by Executive in the business or 
           _                                                           
operations of the Company or any subsidiary or any affiliate of the 
Company, (C) any attempt by Executive directly or indirectly to induce 
          _                                                           
any employee, insurance agent, insurance broker or broker-dealer of 
the Company or any subsidiary or any affiliate to be employed or 
perform services elsewhere, (D) any attempt by Executive directly or 
                             _                                       
indirectly to solicit the trade of any customer or suppliers, or 
prospective customer or suppliers, of the Company on behalf of any 
person other than the Company or a subsidiary thereof (E) any breach 
                                                       _             
or violation of the company's Code of Conduct, as amended from time to 
time.  Notwithstanding the foregoing, a breach of Executive's duty of 
loyalty to the Company as described in subclause (A) or a breach of 
the Company's Code of Conduct as described in the subclause (E) of 
clause (v) of the preceding sentence shall not be grounds for a 
Termination for Cause unless such breach has had or could reasonably 
be expected to have a significant adverse effect on the business or 
reputation of the Company.

"Termination due to Disability" means a termination of Executive's 
employment by the Company because Executive has been incapable of 
substantially fulfilling the positions, duties, responsibilities and 
obligations set forth in this Agreement because of physical, mental or 
emotional incapacity resulting from injury, sickness or disease for a 
period of (i) at least four consecutive months or (ii) more than six 
months in any twelve month period.  Any question as to the existence, 
extent or potentiality of Executive's disability shall be made by a 
qualified, independent physician selected by the chief or assistant 
chief (or the equivalent position) of the department which treats the 
disease giving rise to Executive's absence at a nationally or 
regionally recognized teaching hospital chosen by the Company.  The 
determination of any such physician shall be final and conclusive for 
all purposes of this Agreement.  Notwithstanding the foregoing, (i) a 
Termination for Disability shall not 



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affect Executive's right to receive any amount that would otherwise 
have been payable to Executive under the Company's plans, policies, 
practices or programs pertaining to short-term or long-term disability 
had Executive's employment continued and (ii) if it is determined, at 
the time Executive is first eligible to receive long-term disability 
benefits under the Company's plans, policies, practices or programs, 
that Executive is not entitled to receive such long-term disability 
benefits (other than due to Executive's failure to cooperate), 
Executive shall, for purposes of the Paragraph __, be deemed to have 
been terminated as of the date of such determination pursuant to a 
Termination Without Cause and to be entitled to receive any additional 
benefits payable hereunder in respect of a Termination Without Cause.

"Termination for Good Reason" means a termination of Executive's 
employment by Executive within 90 days following a reduction in 
Executive's annual Base Salary or incentive compensation opportunity.  
Notwithstanding the foregoing, a termination shall be not be treated 
as a Termination for Good Reason (i) if Executive shall have consented 
in writing to the occurrence of the event giving rise to the claim of 
Termination for Good Reason or (ii) unless Executive shall have 
delivered a written notice to the Board within 60 days of his having 
actual knowledge of the occurrence of one of such events stating that 
he intends to terminate his employment for Good Reason and specifying 
the factual basis for such termination, and such event shall not have 
been cured within 30 days of the receipt of such notice.

"Change in Control" means the happening of any of the following:

     (i) When any "person" as defined in Section 3(a)(9) of the 
     Securities Exchange Act of 1934, as amended (the "Exchange Act") 
     and as used in Section 13(d) and 14(d) thereof, including a 
     "group" as defined in Section 13(d) of the Exchange Act but 
     excluding the Company and any subsidiary thereof and any employee 
     benefit plan sponsored or maintained by the Company or any 
     Subsidiary (including any trustee of such plan acting as 
     trustee), directly or indirectly, becomes the "beneficial owner" 
     (as defined in Rule 13d-3 under the Exchange Act, as amended from 
     time to time), of securities of the Company representing 20 
     percent or more of the combined voting power of the Company's 
     then outstanding securities.

     (ii) When, during any period of 24 consecutive months, after the 
     Commencement Date, the individuals who, at the beginning of such 
     period, constitute the Board (the "Incumbent Director") cease for 
     any reason other than death to constitute at least a majority 
     thereof, provided that a director who was not a director at the 
              ________ ____                                          
     beginning of such 24-month period shall be deemed to have 
     satisfied such 24-month requirement (and be an Incumbent 
     Director) if such director was elected by, or on the 
     recommendation of or with the approval of, at least two-thirds of 
     the directors who then qualified as Incumbent Directors either 
     actually (because they were directors at the beginning of such 
     24-month period) or by prior operation of this Paragraph; or







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     (iii) The occurrence of a transaction requiring stockholder 
     approval for the acquisition of the Company by an entity other 
     than the Company or a subsidiary through purchase of assets, or 
     by merger, or otherwise.












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