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, 2004
                          -----------------


Commission file number: 333-114338


                  ReliaStar Life Insurance Company of New York
--------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)

New York                                                              53-0242530
--------------------------------------------------------------------------------
(State or other jurisdiction of                                   (IRS employer
incorporation or organization)                               identification no.)

1000 Woodbury Road, Suite 208, Woodbury, NY                                11797
--------------------------------------------------------------------------------
 (Address of principal executive offices)                             (Zip code)

Registrant's telephone number, including area code  (516) 682-8700
                                                   ---------------


--------------------------------------------------------------------------------
Former name, former address and former fiscal year, if changed since last report

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

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. Yes [ X ] 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. Yes [ X ] No [ ]

Indicate  by check mark  whether  the  registrant  is an  accelerated  filer (as
defined in Rule 12b-2 of the Exchange Act). Yes [ ] No [ X ]

                      APPLICABLE ONLY TO CORPORATE ISSUERS:

Indicate the number of shares  outstanding  of each of the  issuer's  classes of
common stock,  as of the latest  practicable  date:  1,377,863  shares of Common
Stock as of March 29, 2005 all of which were  directly  owned by ReliaStar  Life
Insurance Company.

NOTE:  WHEREAS RELIASTAR LIFE INSURANCE COMPANY OF NEW YORK MEETS THE CONDITIONS
SET FORTH IN GENERAL  INSTRUCTION  I(1)(a)  AND (b) OF FORM  10-K,  THIS FORM IS
BEING FILED WITH THE REDUCED  DISCLOSURE FORMAT PURSUANT TO GENERAL  INSTRUCTION
I(2).


<PAGE>


                  ReliaStar Life Insurance Company of New York
         (A wholly-owned subsidiary of ReliaStar Life Insurance Company)
                           Annual Report on Form 10-K
                      For the year ended December 31, 2004


                                TABLE OF CONTENTS

Form 10-K
 Item No.                                                                   Page

                 PART I

Item 1.         Business*                                                     3
Item 2.         Properties*                                                  12
Item 3.         Legal Proceedings                                            13
Item 4.         Submission of Matters to a Vote of Security Holders**        13

                PART II

Item 5.         Market for Registrant's Common Equity and Related
                Stockholder Matters                                          14
Item 6.         Selected Financial Data***                                   15
Item 7.         Management's Narrative Analysis of the Results of
                Operations and Financial Condition*                          16
Item 7A.        Quantitative and Qualitative Disclosures About Market Risk   37
Item 8.         Financial Statements and Supplementary Data                  39
Item 9.         Changes in and Disagreements with Accountants on Accounting
                and Financial Disclosure                                     83
Item 9A.        Controls and Procedures                                      83
Item 9B         Other Information                                            83

                PART III

Item 10.        Directors and Executive Officers of the Registrant**         84
Item 11.        Executive Compensation**                                     84
Item 12.        Security Ownership of Certain Beneficial Owners
                and Management**                                             84
Item 13.        Certain Relationships and Related Transactions**             84
Item 14.        Principal Accountant Fees and Services                       85

                PART IV

Item 15.        Exhibits and Financial Statement Schedules                   87
                Index to Financial Statement Schedules                       90
                Signatures                                                   94

*    Item prepared in accordance with General Instruction I(2) of Form 10-K
**   Item omitted  pursuant to General  Instruction  I(2) of Form 10-K,
     except as to Part III, Item 10 with respect to compliance with
     Sections 406 and 407 of the Sarbanes Oxley Act of 2002
***  Although item may be omitted pursuant to General Instruction I(2) of
     Form 10-K, the Company has provided certain disclosure under this Item.

                                       2

<PAGE>


                                     PART I

Item 1.        Business
               (Dollar amounts in millions, unless otherwise stated)

               Organization of Business

               ReliaStar  Life  Insurance  Company  of New York  ("RLNY"  or the
               "Company"),  a direct,  wholly-owned subsidiary of ReliaStar Life
               Insurance Company  ("ReliaStar  Life"), is a stock life insurance
               company  organized  under  the  laws of the  State  of New  York.
               ReliaStar Life is a wholly-owned  subsidiary of Lion  Connecticut
               Holdings  Inc.  ("Lion"),  a Connecticut  holding and  management
               company.  Lion is an  indirect,  wholly-owned  subsidiary  of ING
               Groep N.V. ("ING"),  a global financial  services holding company
               based in The Netherlands,  with American Depository Shares listed
               on the New York Stock Exchange under the symbol "ING".

               Until October 1, 2003, the Company was a wholly-owned  subsidiary
               of      Security-Connecticut      Life     Insurance      Company
               ("Security-Connecticut  Life"), a Minnesota  domiciled  insurance
               company,  which provided  financial  products and services in the
               United States.  Effective  October 1, 2003,  Security-Connecticut
               merged with and into ReliaStar Life.

               On April 1, 2002,  ReliaStar Life acquired First Golden  American
               Life  Insurance  Company  of  New  York  ("First   Golden"),   an
               affiliated entity, for a purchase price of $27.7 in cash and $0.2
               in  receivables.  The purchase  price was based on First Golden's
               statutory-basis  book  value per  generally  accepted  accounting
               principles  in  the  United  States   ("GAAP").   ReliaStar  Life
               contributed  First  Golden to  Security-Connecticut  at GAAP book
               value. Security-Connecticut contributed First Golden to RLNY, and
               First  Golden was  dissolved  into RLNY at GAAP book  value.  The
               contribution  of First Golden to RLNY was recorded as an increase
               to  stockholder's  equity of $31.4 which equaled  First  Golden's
               April 1,  2002 GAAP  book  value.  Approval  for the  merger  was
               obtained from the Insurance Departments of the States of New York
               and Delaware.

               The  Company  has  one  operating  segment,  ING  U.S.  Financial
               Services ("USFS").

               Description of Business

               The Company is  principally  engaged in the business of providing
               life  insurance  and related  financial  services  products.  The
               Company  provides and  distributes  individual life insurance and
               annuities,  employee benefits products and services and qualified
               group  annuity  contracts  that  include a variety of funding and
               payout options for employer sponsored  retirement plans qualified
               under Internal  Revenue Code Section 401. The Company's  strategy
               is to offer,  principally in the education market, a wide variety
               of products and services designed to address customers' needs for
               financial  security,   especially   tax-advantaged   savings  for
               retirement and protection in the event of death.

                                       3

<PAGE>

               Individual  Life  Insurance and  Annuities:  Products,  Principal
               Markets, and Methods of Distribution

               The  Company  offers a wide range of  individual  life  insurance
               products, including term, universal life, second-to-die universal
               life,  variable  universal  life,  as well as fixed and  variable
               annuities  through a network of independent  agents and financial
               professionals.   These   products  are  marketed  to   individual
               customers  who  prefer  to  purchase   insurance  and  investment
               products from a personal financial adviser. These products target
               middle and  upper-income  families and niche  markets,  including
               U.S. military personnel and small-business owners.

               Variable  universal  life  and  fixed  universal  life  insurance
               products  represent a significant  portion of the individual life
               insurance  premium  volume.  Variable  universal  life  insurance
               policies contain alternative investment options (generally mutual
               funds)  and  policy   values  which  will  vary  based  upon  the
               investment  returns of the fund(s) selected by the  policyholder,
               while providing certain benefits associated with traditional life
               insurance,   such  as  death  benefits  and  cash  values.  Fixed
               universal  life  policies   provide  for  guaranteed   levels  of
               insurance   protection  and  minimum  interest  rate  guarantees.
               Interest-sensitive  products provide for interest crediting rates
               which may be adjusted periodically, subject to minimum guaranteed
               rates as set forth in  policyholder  contracts.  Adjustments  are
               made to the crediting rates on interest-sensitive  products based
               upon a variety  of  factors,  including  investment  performance,
               market  interest  rates,   and   competitive   factors.   Profits
               recognized  on   interest-sensitive   products  are  affected  by
               mortality experience, the margin between interest rates earned on
               investments and interest  credited to  policyholders,  as well as
               capital  gains  and  losses  on  investments,   persistency,  and
               expenses.

               The  variable  annuity   products  offered  contain   alternative
               investment  options  (generally  mutual  funds) and policy values
               which will vary based upon the investment  returns of the fund(s)
               selected by the contractowner.

               Variable  annuities  are  long-term  savings  vehicles  in  which
               contract  owner  premiums  (purchase  payments)  are recorded and
               maintained in sub-accounts  within separate accounts  established
               and  registered  with  the  Securities  and  Exchange  Commission
               ("SEC") as a unit investment trust.  Variable annuities issued by
               the Company are a  combination  of  variable  and fixed  deferred
               annuity  contracts under which some or all of the premiums may be
               allocated by the contractowner to a fixed account available under
               the contract.

               The    Company     discourages     premature     surrenders    of
               interest-sensitive products through contractual surrender charges
               and the adjustment of interest  crediting rates. The policies and
               annuities sold contain  provisions which allow the  contractowner
               or  policyholder  to withdraw or surrender  their contracts under
               defined   circumstances.   These  contracts   generally   contain
               provisions  which apply  penalties or otherwise limit the ability
               of  contractowners  and policyholders to make such withdrawals or
               surrenders. The interest rates that the Company might be required
               to credit under their  interest-sensitive  insurance  products to
               forestall  surrenders,  particularly  in a time of rapidly rising
               market interest rates,  could have an adverse effect on operating
               income.

                                       4


<PAGE>

               Individual  life  insurance  business  is subject to risks in the
               event that the Company's  mortality  experience deviates from the
               assumptions used in establishing its premium rates.

               Employee Benefit:  Products,  Principal  Markets,  and Methods of
               Distribution

               The Company  targets the sale of employee  benefits and financial
               services to medium and large  corporate  employers  and  affinity
               groups.   Additionally,   the  Company   sells   individual   and
               payroll-deduction products to employees of its corporate clients.
               Principal  products  include group and individual  life insurance
               and non-medical group insurance products.

               Group life and disability  insurance and employee benefit related
               services are offered by the Company.  Employee  benefits products
               are  marketed  through  major  brokerage  operations  and through
               direct sales to employers.

               Group term life  insurance is marketed to employer  groups in the
               Company's  target  market.  Premiums for these policies are based
               largely  upon  the  experience  of  the  Company,   and  in  some
               instances,   on   the   experience   of  the   particular   group
               policyholder.  The primary risks related to this line of business
               include  deviations  from  expected  mortality,   expenses,   and
               investment  income.  The Company  seeks to control the  mortality
               risk through reinsurance treaties.

               The Company also markets group disability income insurance.  This
               coverage compensates employees for loss of income due to sickness
               or injury.  The  profitability  of this  business  is affected by
               morbidity   experience  and  the  investment   return  on  assets
               supporting the policy reserves.

               The  Company  markets   individual  life  insurance  policies  to
               employees at the worksite and to members of affinity groups.  The
               products  delivered  to  these  markets  include  universal  life
               insurance policies, whole life insurance policies, and individual
               term life policies.

               The Company also markets  medical stop loss  coverage to employer
               sponsors of self-funded  employee health benefit plans.  Prior to
               2003,  the  Company  marketed   individual   cancer  policies  to
               employees at the worksite as well.

               Group  Annuities:  Products,  Principal  Markets  and  Methods of
               Distribution

               Group  annuity  contracts  may be deferred or  immediate  (payout
               annuities).  These products include programs offered to qualified
               plans that package  administrative  and  record-keeping  services
               along with a variety of investment options,  including affiliated
               and nonaffiliated  mutual funds and variable and fixed investment
               options.

               Group annuity  contracts  offered by the Company contain variable
               and/or  fixed  investment  options.  Variable  options  generally
               provide for full assumption by the customer of investment  risks.
               Assets  supporting  variable annuity options are held in Separate

                                       5


<PAGE>

               Accounts that invest in mutual funds managed  and/or  distributed
               by RLNY or its  affiliates,  or  managed  and/or  distributed  by
               unaffiliated  entities.   Variable  Separate  Account  investment
               income and realized capital gains and losses are not reflected in
               the Company's  consolidated  statements of income.  Fixed options
               are "fully  guaranteed".  Fully-guaranteed  fixed options provide
               guarantees  on  investment   return,   maturity  values  and,  if
               applicable, benefit payments.

               Although  the  Company  has  offered  group   annuity   contracts
               primarily to small businesses, it is not actively marketing these
               products.  The Company's  group annuity  products  generally were
               sold  through  pension  professionals,   independent  agents  and
               brokers,  third party  administrators,  banks,  dedicated  career
               agents and financial planners.

               Geographic Distribution

               The  Company  operates  primarily  in the  United  States  and is
               authorized to conduct  business in all 50 states and the District
               of Columbia.

               Competition

               The  businesses  in which the  Company  engages  are each  highly
               competitive.  The products compete in marketplaces  characterized
               by  a  large  number  of  competitors   with  similar   products.
               Competition  is based largely upon the crediting  rates under the
               policies,  the  credit  and claims  paying  ratings of  competing
               insurers,   name  recognition,   the  commission   structures  of
               competing   insurers,   and  the  levels  of   service   afforded
               distributors.  Competing  investment  opportunities are also made
               available   by  mutual   funds,   banks,   and  other   financial
               intermediaries,  many of which have  greater  resources  than the
               Company.  The  products  are not  generally  eligible  for  legal
               protection  from being copied by others,  and capital is the most
               significant barrier to entry by new competitors.

               Group life  insurance is a  homogeneous  product sold in a highly
               competitive market. The Company's  competitors include all of the
               largest insurers doing business in the United States.

               Investment Overview and Strategy

               The Company's  investment  strategy involves  diversification  by
               asset  class,  and seeks to add economic  diversification  and to
               reduce  the risks of  credit,  liquidity,  and  embedded  options
               within  certain  investment  products,  such as convexity risk on
               collateralized   mortgage   obligations  and  call  options.  The
               investment   management   function  is   centralized   under  ING
               Investment  Management LLC ("IIM"),  an affiliate of the Company,
               pursuant to an investment advisory agreement. Separate portfolios
               are  established  for each  general  type of  product  within the
               Company.

                                       6

<PAGE>

               The Company's general account invests primarily in fixed maturity
               investments,   including   publicly   issued   bonds   (including
               government   bonds),    privately   placed   notes   and   bonds,
               mortgage-backed  securities,  and  asset-backed  securities.  The
               primary  investment  strategy  is to optimize  the  risk-adjusted
               return on capital through superior asset selection  predicated on
               a  developed   relative  value  approach,   credit  research  and
               monitoring, superior management of interest rate risk, and active
               exploration   into   new   investment   product    opportunities.
               Investments are purchased when market returns, adjusted for risk,
               capital and expenses, are sufficient to profitably support growth
               of the  liability  block of  business.  In  addition,  assets and
               liabilities  are analyzed  and  reported for internal  management
               purposes  on an  option-adjusted  basis.  The  level of  required
               capital of given  transactions is a primary factor in determining
               relative   value  among   different   investment   and  liability
               alternatives,  within the scope of each product type's objective.
               An active review of existing holdings  identifies specific assets
               that  could  be  effectively  traded  in  order  to  enhance  the
               risk-adjusted returns of the portfolio,  while minimizing adverse
               tax and  accounting  impacts.  The Company  strives to maintain a
               portfolio  average asset quality rating of A, excluding  mortgage
               loans,  but  including  mortgage-backed  securities,   which  are
               reported  with  bonds,   based  on  Standard  &  Poor's   ratings
               classifications.

               Ratings

               On December 15, 2004,  Standard & Poor's  reaffirmed its AA (Very
               Strong)  counterparty  credit and  financial  strength  rating of
               ING's primary U.S.  insurance  operating  companies ("ING U.S."),
               including  the  Company.  Standard & Poor's  also,  on this date,
               revised the  outlook on the core  insurance  operating  companies
               from negative to stable, reflecting ING's commercial position and
               diversification, financial flexibility, reduced capital leverage,
               and improved profitability. The outlook revisions recognize ING's
               progress  in  setting  a  more  focused  and  decisive  strategic
               direction and implementing more integrated  financial  management
               across banking and insurance.

               On  December  17,  2004,   Moody's   Investor's   Service,   Inc.
               ("Moody's")  issued  a credit  opinion  affirming  the  financial
               strength  rating  of ING  U.S.,  including  the  Company,  of Aa3
               (Excellent)  with a stable  outlook.  The  rating is based on the
               strong  implicit  support  and  financial  strength of the parent
               company, ING. Furthermore,  Moody's noted that ING U.S. has built
               a leading market share in the domestic individual life insurance,
               annuity, and retirement plan businesses.  ING U.S. enjoys product
               diversity,  further  enhancing its credit profile through the use
               of these multiple distribution channels.

                                       7

<PAGE>

               On December 22, 2004,  A.M.  Best  Company,  Inc.  ("A.M.  Best")
               reaffirmed the financial  strength rating of A+ (Superior) of ING
               U.S.,  including  the  Company,  while  maintaining  its negative
               outlook  for  ING  U.S.   These  rating   actions   follow  ING's
               announcement  of its intention to sell Life Insurance  Company of
               Georgia ("LOG"),  as well as the conclusion of A.M. Best's review
               of ING's plan to exit the U.S. individual  reinsurance  business.
               ING  closed  the  transaction  to exit the U.S.  individual  life
               reinsurance  business on December 31, 2004 and the sale of LOG is
               expected  to be  completed  during  the  second  quarter of 2005,
               subject to  regulatory  approval.  Neither of these  transactions
               directly impact the Company.

               Regulation

               The Company's operations are subject to comprehensive  regulation
               throughout   the  United   States.   The  laws  of  the   various
               jurisdictions establish supervisory agencies, including the state
               insurance departments,  with broad authority to grant licenses to
               transact  business and regulate  many aspects of the products and
               services offered by the Company,  as well as solvency and reserve
               adequacy.  Many agencies also regulate the investment  activities
               of insurance companies on the basis of quality,  diversification,
               and other  quantitative  criteria.  The Company's  operations and
               accounts  are  subject to  examination  at regular  intervals  by
               certain of these regulators.

               Operations  conducted by the Company are subject to regulation by
               various  state  insurance  departments  in the  states  where the
               Company conducts business, in particular the insurance department
               of its state of domicile,  New York.  Among other matters,  these
               agencies may  regulate  premium  rates,  trade  practices,  agent
               licensing,  policy forms,  underwriting and claims practices, and
               the maximum interest rates that can be charged on policy loans.

               The SEC, the National  Association of Securities Dealers ("NASD")
               and,  to  a  lesser  extent,   the  states  regulate   investment
               management  activities and operations of the Company.  Generally,
               the  Company's  variable life and variable  annuity  products and
               certain of its fixed  annuities are registered as securities with
               the SEC.  Regulations of the SEC, Department of Labor ("DOL") and
               Internal  Revenue  Service also impact  certain of the  Company's
               annuity,  life  insurance,  and other  investment  and retirement
               products.  These products  involve  separate  accounts and mutual
               funds  registered  under the Investment  Company Act of 1940. The
               Company  also  provides a variety of  products  and  services  to
               employee   benefit   plans  that  are  covered  by  the  Employee
               Retirement Income Security Act of 1974 ("ERISA").

                                       8

<PAGE>

               Insurance Holding Company Laws

               A number of states regulate affiliated groups of insurers such as
               the Company under holding  company  statutes.  These laws,  among
               other things,  place certain restrictions on transactions between
               affiliates such as dividends and other  distributions that may be
               paid to the Company's parent corporation.

               Insurance Company Guaranty Fund Assessments

               Insurance  companies  are  assessed  the  costs  of  funding  the
               insolvencies  of other  insurance  companies by the various state
               guaranty associations,  generally based on the amount of premiums
               companies  collect in that state. The Company accrues the cost of
               future guaranty fund assessments  based on estimates of insurance
               company  insolvencies  provided by the National  Organization  of
               Life and Health Insurance Guaranty Association ("NOLHGA") and the
               amount  of  premiums  written  in each  state.  The  Company  has
               recorded $0.3 and $0.2 for this liability as of December 31, 2004
               and 2003, respectively. The Company has also recorded an asset of
               $0.2 as of December  31, 2004 and a minimal  asset as of December
               31, 2003,  for future  credits to premium  taxes for  assessments
               already paid.

               For  information  regarding  certain other  potential  regulatory
               changes  related to the  Company's  business  see "Risk  Factors"
               relating to the Company in Item 1, "Business".

               Employees

               The Company had 93 employees  as of December 31, 2004,  primarily
               focused on managing the product distribution, marketing, customer
               service, and product and financial management of the Company. The
               Company  also  utilizes  services  provided by ING North  America
               Insurance Corporation,  Inc. and other affiliates. These services
               include underwriting and new business processing, actuarial, risk
               management,  human  resources,  investment  management,  finance,
               information  technology,  and legal and compliance services.  The
               affiliated  companies  are  reimbursed  for the  Company's use of
               various  services and facilities  under a variety of intercompany
               agreements.

               Risk Factors

               In  addition  to the normal  risks of  business,  the  Company is
               subject to significant risks and  uncertainties,  including those
               which are discussed below.

                                       9

<PAGE>


               The  Company's  efforts  to reduce the  impact of  interest  rate
               changes on its profitability  and financial  condition may not be
               effective

               The Company  attempts to reduce the impact of changes in interest
               rates  on  the  profitability  and  financial  condition  of  its
               interest-sensitive  life  and  annuity  operations.  The  Company
               accomplishes this reduction primarily by managing the duration of
               its assets relative to the duration of its liabilities.  During a
               period of rising  interest  rates,  surrenders of life  insurance
               policies  and  withdrawal  of annuity  contracts  may increase as
               customers seek to achieve higher returns.  Despite its efforts to
               reduce the impact of rising  interest  rates,  the Company may be
               required to sell assets to raise the cash necessary to respond to
               such surrenders and withdrawals, thereby realizing capital losses
               on  the  assets  sold.  An  increase  in  policy  surrenders  and
               withdrawals   may  also   require  the   Company  to   accelerate
               amortization  of  policy  acquisition  costs  relating  to  these
               contracts, which would further reduce its net income.

               During periods of declining interest rates,  borrowers may prepay
               or redeem  mortgages and bonds that the Company owns, which would
               force it to reinvest the proceeds at lower  interest  rates.  The
               Company  may have the  ability  to lower the rates it  credits to
               contractowners  and  policyholders  but may be forced to maintain
               crediting  rates for products  containing  minimum  interest rate
               guarantees or for competitive reasons.  Therefore, it may be more
               difficult for the Company to maintain its desired  spread between
               the investment income it earns and the interest it credits to its
               customers, thereby reducing its profitability.

               A downgrade  in any of the  Company's  ratings  may,  among other
               things, increase case/policy lapses,  surrenders, and withdrawals
               reduce new sales, and terminate  relationships with distributors,
               any  of  which  could  adversely  affect  its  profitability  and
               financial condition

               Ratings are important  factors in  establishing  the  competitive
               position of insurance  companies.  A downgrade,  or the potential
               for such a  downgrade,  of any of the  Company's  ratings  could,
               among other things:

               o    Materially  increase the number of  interest-sensitive  life
                    and  annuity   contract   surrenders  and   withdrawals  and
                    case/policy   lapses;

               o    Result   in   the   termination   of   relationships    with
                    broker-dealers,   banks,   agents,   wholesalers  and  other
                    distributors of our products and services;  and

               o    Reduce new product sales.

               Any of these  consequences  could adversely  affect the Company's
               profitability and financial condition.

                                       10

<PAGE>


               Rating  organizations  assign ratings based upon several factors.
               While most of the factors  relate to the rated  company,  some of
               the  factors  relate  to the  views of the  rating  organization,
               general economic  conditions and circumstances  outside the rated
               company's control. In addition,  rating  organizations may employ
               different models and formulas to assess financial strength of the
               rated company,  and from time to time rating  organizations have,
               in their discretion,  altered the models.  Changes to the models,
               general  economic  conditions,   or  circumstances   outside  the
               Company's control could impact a rating  organization's  judgment
               of its  rating  and  the  subsequent  rating  it  assigns  to the
               Company.   The  Company   cannot   predict  what  actions  rating
               organizations  may take,  or what  actions we may be  required to
               take in response to the  actions of rating  organizations,  which
               could adversely affect the Company.

               The  Company's  ability to grow may depend in large part upon the
               continued availability of capital

               The  Company  believes  it has  sufficient  capital  to fund  its
               immediate  growth  and  capital  needs.  The  amount  of  capital
               required and the amount of capital available can vary from period
               to period  due to a variety of  circumstances,  some of which are
               neither  predictable nor foreseeable,  nor necessarily within its
               control.  A lack of sufficient capital could hinder the Company's
               ability to grow.

               The  Company's  investment  portfolio is subject to several risks
               that may diminish the value of its invested  assets and adversely
               affect  its  sales,  profitability  and  the  investment  returns
               credited to certain of its customers

               The Company's  investment  portfolio is subject to several risks,
               including default,  liquidity,  environmental and economic, among
               other things:

               o    The  Company  may  experience  an  increase  in  defaults or
                    delinquency  in the  investment  portfolios,  including  the
                    commercial  mortgage loan portfolio.
               o    The Company may have greater  difficulty  selling  privately
                    placed fixed maturity securities, commercial mortgage loans,
                    and real  estate  investments  at  attractive  prices,  in a
                    timely  manner,  or both,  because they are less liquid than
                    its   publicly   traded   fixed   maturity   securities.
               o    Environmental   liability   exposure  may  result  from  the
                    Company's commercial mortgage loan portfolio and real estate
                    investments.
               o    The Company may experience losses in its commercial mortgage
                    loan  portfolio as a result of economic  downturns or losses
                    attributable to natural disasters in certain regions.

              Any of these consequences may diminish the value of the Company's
              invested assets and adversely affect its sales, profitability or
              the investment returns credited to its customers.

                                       11

<PAGE>


               Changes  in  regulation  in the  United  States  may  reduce  the
               Company's profitability

               The  Company's  insurance  business  is subject to  comprehensive
               regulation and  supervision  throughout the United States by both
               state  and  federal  regulators.  The  primary  purpose  of state
               regulation of the insurance business is to protect  policyholders
               and   contractowners   and  not   necessarily  to  protect  other
               constituencies  such as creditors or investors.  State  insurance
               regulators,  state attorneys general, the National Association of
               Insurance  Commissioners,  the  SEC,  and  the  NASD  continually
               reexamine existing laws and regulations and may impose changes in
               the future.  Changes in federal  legislation  and  administrative
               policies  in areas  such as  employee  benefit  plan  regulation,
               financial services regulation,  and federal taxation could lessen
               the  advantages of certain of the Company's  products as compared
               to competing  products,  or possibly  result in the  surrender of
               some  existing  contracts  and  policies or reduced  sales of new
               products   and,    therefore,    could   reduce   the   Company's
               profitability.

               The insurance  industry has recently  become the focus of greater
               regulatory  scrutiny  due  to  questionable   business  practices
               relating  to trading  and  pricing  within  the  mutual  fund and
               variable  annuity  industries,  allegations  related to  improper
               special  payments,   price-fixing,   conflicts  of  interest  and
               improper  accounting  practices,  and other misconduct alleged by
               and initiatives of the New York Attorney General, state insurance
               departments,  and in  related  litigation.  As a result,  a large
               number of insurance companies,  including certain ING affiliates,
               have  been   requested  to  provide   information  to  regulatory
               authorities.  In some cases, this regulatory  scrutiny has led to
               new  proposed   legislation   regulating   insurance   companies,
               regulatory penalties,  and related litigation.  At this time, the
               Company does not believe that any such  regulatory  scrutiny will
               materially  adversely  impact it;  however,  the  Company  cannot
               guarantee that new laws,  regulations or other regulatory  action
               aimed  at  the  business   practices  under  scrutiny  would  not
               adversely  affect  its  business.  The  adoption  of new  laws or
               regulations,  enforcement  actions or litigation,  whether or not
               involving  the Company,  could  influence  the manner in which it
               distributes its insurance products,  which could adversely impact
               the Company.


Item 2.        Properties

               The Company's home office is located at 1000 Woodbury Road, Suite
               208,  Woodbury,  NY 11797.  All Company office space is leased or
               subleased  by the  Company or its other  affiliates.  The Company
               pays  substantially  all expenses  associated with its leased and
               subleased  office   properties.   Affiliates  within  ING's  U.S.
               operations provide the Company with various management,  finance,
               investment  management and other  administrative  services,  from
               facilities  located at 5780  Powers  Ferry Road,  N.W.,  Atlanta,
               Georgia  30327-4390.  Affiliates  also  provide the Company  with
               product development, sales, marketing, customer service and other
               administrative  services from facilities  located in Minneapolis,
               Minnesota,  West Chester,  Pennsylvania and Minot,  North Dakota.
               The affiliated  companies are reimbursed for the Company's use of
               these  services and  facilities  under a variety of  intercompany
               agreements.

                                       12


<PAGE>

Item 3.        Legal Proceedings

               The   Company   is   a   party   to    threatened    or   pending
               lawsuits/arbitrations,   arising  from  the  normal   conduct  of
               business.   Due  to  the  climate  in   insurance   and  business
               litigation/arbitration,   suits  against  the  Company  sometimes
               include claims for substantial  compensatory,  consequential,  or
               punitive  damages  and other types of relief.  Moreover,  certain
               claims are asserted as class  actions,  purporting to represent a
               group of similarly situated individuals. While it is not possible
               to forecast the outcome of such  lawsuits/arbitrations,  in light
               of existing insurance,  reinsurance and established  reserves, it
               is the  opinion  of  management  that  the  disposition  of  such
               lawsuits/arbitrations,  will not have a materially adverse effect
               on the Company's operations or financial position.


Item 4.        Submission of Matters to a Vote of Security Holders

               Omitted pursuant to General Instruction I (2)(c) of Form 10-K.


                                       13

<PAGE>


                                     PART II

Item 5.        Market for Registrant's  Common Equity and Related  Stockholder
               Matters
               (Dollar amounts in millions, unless otherwise stated).

               There is no public trading market for the Company's common stock.
               As of October 1, 2003,  all of the Company's  outstanding  common
               stock  is  owned  by  ReliaStar  Life,  which  is a  wholly-owned
               subsidiary of Lion,  whose ultimate  parent is ING. Prior to that
               date,   the   Company's   outstanding   shares   were   owned  by
               Security-Connecticut Life.

               The  Company's  ability to pay dividends to its parent is subject
               to the prior approval of the insurance regulatory  authorities of
               the State of New York for payment of  dividends,  which exceed an
               annual  limit  of the  lesser  of (1) ten  percent  (10%)  of the
               Company's  statutory  surplus  at  prior  year  end  or  (2)  the
               Company's  prior year  statutory  net gain from  operations,  not
               including  realized capital gains. The Company paid $27.2,  $25.5
               and $14.4 in cash dividends to ReliaStar  Life in 2004,  2003 and
               2002, respectively.

               The  Company did not receive  capital  contributions  in 2004 and
               2003. The Company received capital contributions of $31.4 in 2002
               from  Security-Connecticut  Life,  related  to the  First  Golden
               merger with and into the Company.


                                       14

<PAGE>



Item 6.       Selected Financial Data
              (Dollar amounts in millions, unless otherwise stated).

                         RELIASTAR LIFE INSURANCE COMPANY OF NEW YORK
                          3-YEAR SUMMARY OF SELECTED FINANCIAL DATA

<TABLE>
<S>                                                    <C>           <C>           <C>

                                                          2004          2003          2002
                                                      -----------------------------------------
OPERATING RESULTS
Net investment income                                      $ 122.2       $ 124.4       $ 133.1
Fee income                                                    95.9          94.7          98.2
Premiums                                                      64.7          61.8          55.0
Net realized capital gains and (losses)                        9.2          10.6          (3.2)
Total revenue                                                296.9         295.5         288.6
Interest credited and other benefits
    to contractowners and policyholders                      189.0         147.5         176.3
Amortization of deferred policy acquisition
    costs and value of business acquired                       9.4          30.9          32.6
Income before cumulative effect
    of change in accounting principles                        30.8          53.9          32.6
Cumulative effect of change in accounting
    principles, after-tax                                      0.8             -        (865.0)
Net income (loss)                                             31.6          53.9        (832.4)

FINANCIAL POSITION
Total investments                                        $ 2,090.1     $ 2,035.8     $ 1,951.1
Assets held in separate accounts                             537.7         513.8         426.8
Total assets                                               2,972.2       2,824.1       2,656.5
Policy liabilities and accruals                            1,772.5       1,677.2       1,645.8
Liabilities related to separate accounts                     537.7         513.8         426.8
Shareholder's equity                                         451.6         454.6         425.8

</TABLE>


                                       15

<PAGE>


Item 7.        Management's Narrative Analysis of the Results of Operations and
               Financial Condition
               (Dollar amounts in millions, unless otherwise stated).

               Overview

               The following narrative analysis presents a review of the results
               of operations  of ReliaStar  Life  Insurance  Company of New York
               ("RLNY" or the "Company") for the periods ended December 31, 2004
               versus 2003 and of the  financial  condition  as of December  31,
               2004 and 2003.  This review should be read in its entirety and in
               conjunction   with  the  selected   financial   data,   financial
               statements,  related notes and other  supplemental data which can
               be found under Part II, Item 6 and Item 8 contained herein.

               Forward-Looking Information/Risk Factors

               In connection  with the "safe  harbor"  provisions of the Private
               Securities  Litigation  Reform Act of 1995, the Company  cautions
               readers regarding certain forward-looking statements contained in
               this report and in any other statements made by, or on behalf of,
               the Company, whether or not in future filings with the Securities
               and Exchange Commission ("SEC").  Forward-looking  statements are
               statements not based on historical  information  and which relate
               to future operations,  strategies,  financial  results,  or other
               developments.   Statements   using   verbs   such  as   "expect,"
               "anticipate,"  "believe",  or words of similar  import  generally
               involve   forward-looking   statements.   Without   limiting  the
               foregoing,  forward-looking  statements  include statements which
               represent the Company's beliefs concerning future levels of sales
               and redemptions of the Company's products, investment spreads and
               yields,  or the  earnings  and  profitability  of  the  Company's
               activities.

               Forward-looking statements are necessarily based on estimates and
               assumptions that are inherently subject to significant  business,
               economic, and competitive  uncertainties and contingencies,  many
               of which are beyond the  Company's  control and many of which are
               subject to change.  These  uncertainties and contingencies  could
               cause actual results to differ materially from those expressed in
               any  forward-looking  statements  made by, or on behalf  of,  the
               Company.  Whether or not actual  results differ  materially  from
               forward-looking statements may depend on numerous foreseeable and
               unforeseeable  developments.  Some may be national in scope, such
               as general economic  conditions,  changes in tax law, and changes
               in interest rates. Some may be related to the insurance  industry
               generally, such as pricing competition,  regulatory developments,
               and  industry  consolidation.  Others may  relate to the  Company
               specifically,  such as litigation,  regulatory  action, and risks
               associated  with  the  Company's  investment  portfolio,  such as
               change  in  credit  quality,   price  volatility  and  liquidity.
               Investors  are  also   directed  to  consider   other  risks  and
               uncertainties  discussed  in "Risk  Factors"  in Item 1 contained
               herein and in other  documents filed by the Company with the SEC.
               Except as may be  required by the federal  securities  laws,  the
               Company  disclaims  any  obligation  to  update   forward-looking
               information.


                                       16

<PAGE>


               Critical Accounting Policies

               General

               The  preparation  of  financial  statements  in  conformity  with
               generally  accepted  accounting  principles  in the United States
               requires  the  use  of  estimates  and   assumptions  in  certain
               circumstances  that affect amounts  reported in the  accompanying
               financial  statements and related footnotes.  These estimates and
               assumptions   are  evaluated  on  an  on-going   basis  based  on
               historical developments,  market conditions, industry trends, and
               other  information  that is reasonable  under the  circumstances.
               There can be no  assurance  that actual  results  will conform to
               estimates  and   assumptions,   and  that  reported   results  of
               operations will not be materially  adversely affected by the need
               to make future accounting adjustments to reflect changes in these
               estimates and assumptions from time to time.

               The Company has identified the following estimates as critical in
               that they involve a higher  degree of judgment and are subject to
               a     significant     degree    of     variability:     reserves,
               other-than-temporary   impairment  testing  and  amortization  of
               deferred  acquisition  costs and value of business  acquired.  In
               developing  these  estimates,  management  makes  subjective  and
               complex  judgments that are  inherently  uncertain and subject to
               material  change as facts  and  circumstances  develop.  Although
               variability is inherent in these estimates,  management  believes
               the  amounts  provided  are  appropriate  based  upon  the  facts
               available upon compilation of the financial statements.

               Reserves

               The  Company  establishes  and  carries  actuarially   determined
               reserves  which are  calculated  to meet its future  obligations.
               Reserves are  calculated  using  mortality  and  withdrawal  rate
               assumptions that are based on relevant Company experience and are
               periodically   reviewed  against  both  industry   standards  and
               experience.  Changes in or deviations from the  assumptions  used
               can significantly affect the Company's reserve levels and related
               future operations.

               Future  policy  benefits  include  reserves for  universal  life,
               immediate annuities with life contingent payouts, and traditional
               life  insurance  contracts.  Reserves for universal life products
               are equal to  cumulative  deposits less  withdrawals  and charges
               plus credited  interest thereon.  In addition,  the Company holds
               reserves  as  required  by SOP 03-1  for  certain  products  with
               anticipated  losses  in  later  policy  durations.  Reserves  for
               traditional life insurance  contracts represent the present value
               of future  benefits  to be paid to or on behalf of  policyholders
               and  related  expenses  less  the  present  value of  future  net
               premiums.


                                       17

<PAGE>


               Reserves for  immediate  annuities  with life  contingent  payout
               benefits  are computed on the basis of interest  discount  rates,
               mortality,   and   expenses,   including  a  margin  for  adverse
               deviations.  Such  assumptions  generally  vary by plan,  year of
               issue and policy  duration.  Reserve  interest  rates  range from
               3.95% to 13.19% for all years presented. Changes in or deviations
               from the assumptions used can significantly  affect the Company's
               reserve level and related future operations.

               Reserves for deferred annuity investment  contracts and immediate
               annuities   without  life   contingent   benefits  are  equal  to
               cumulative  deposits less charges and  withdrawals  plus credited
               interest  thereon  (reserve  interest rates vary by product up to
               7.1% for 2004, 2003, and 2002).

               Other-Than-Temporary Impairment Testing

               The Company's  accounting  policy  requires that a decline in the
               value of an investment below its amortized cost basis be assessed
               to determine if the decline is  other-than-temporary.  If so, the
               investment is deemed to be  other-than-temporary  impaired, and a
               charge is recorded in net  realized  capital  losses equal to the
               difference between fair value and the amortized cost basis of the
               investment. The fair value of the other-than-temporarily impaired
               investment becomes its new cost basis.

               In addition,  the Company  invests in structured  securities that
               meet the  criteria  of EITF  Issue  No.  99-20,  "Recognition  of
               Interest   Income  and   Impairment  on  Purchased  and  Retained
               Beneficial Interests in Securitized Financial Assets." Under EITF
               Issue No. 99-20, a  determination  of the required  impairment is
               based  on  credit  risk  and  the   possibility   of  significant
               prepayment  risk that restricts the Company's  ability to recover
               the investment.  An impairment is recognized if the fair value of
               the  security  is less  than  book  value  and  there has been an
               adverse  change in cash flow since the last  remeasurement  date.
               When   a   decline   in   fair   value   is   determined   to  be
               other-than-temporary,  the individual security is written down to
               fair value and the loss accounted for as a realized loss.

               The evaluation of other-than-temporary  impairments,  included in
               the Company's general account,  is a quantitative and qualitative
               process,  which is  subject  to risks  and  uncertainties  and is
               intended  to  determine  whether  declines  in the fair  value of
               investments should be recognized in current period earnings.  The
               risks and uncertainties  include the length of time and extent to
               which the fair value has been less than amortized  cost,  changes
               in general economic conditions,  the issuer's financial condition
               or  near-term  recovery  prospects  and the effects of changes in
               interest rates.

               Amortization of Deferred  Acquisition Costs and Value of Business
               Acquired

               Deferred  policy   acquisition  costs  ("DAC")  represent  policy
               acquisition  costs that have been  capitalized and are subject to
               amortization.   Such  costs   consist   principally   of  certain
               commissions,   underwriting,   contract   issuance,   and  agency
               expenses, related to the production of new and renewal business.


                                       18

<PAGE>

               Value of business  acquired  ("VOBA")  represents the outstanding
               value  of  in  force  business  capitalized  and  is  subject  to
               amortization   in  purchase   accounting  when  the  Company  was
               acquired.  The value is based on the present  value of  estimated
               net cash flows embedded in the Company's contracts.

               The  amortization  methodology  used for DAC and VOBA  varies  by
               product type. Statement of Financial Accounting Standards ("FAS")
               No. 60,  "Accounting  and  Reporting by  Insurance  Enterprises,"
               applies to traditional life insurance  products,  primarily whole
               life and term life insurance contracts. Under FAS No. 60, DAC and
               VOBA are amortized over the premium payment period, in proportion
               to the premium revenue recognized.

               FAS No. 97 "Accounting and Reporting by Insurance Enterprises for
               Certain Long Duration Contracts and for Realized Gains and Losses
               from the Sale of  Investments,"  applies  to  universal  life and
               investment-type  products,  such as fixed and  variable  deferred
               annuities.  Under FAS No.  97, DAC and VOBA are  amortized,  with
               interest,  over the life of the  related  contracts  (usually  25
               years) in relation to the present value of estimated future gross
               profits  from   investment,   mortality,   and  expense  margins;
               asset-based fees, policy  administration,  and surrender charges;
               less policy maintenance fees and non-capitalized  commissions, as
               well as realized gains and losses on investments.

               Changes in assumptions  can have a significant  impact on DAC and
               VOBA balances and  amortization  rates.  Several  assumptions are
               considered  significant in the estimation of future gross profits
               associated  with variable  universal  life and variable  deferred
               annuity  products.  One  of  the  most  significant   assumptions
               involved in the estimation of future gross profits is the assumed
               return  associated  with the  variable  account  performance.  To
               reflect the  volatility in the equity  markets,  this  assumption
               involves a combination  of near-term  expectations  and long-term
               assumptions  regarding market performance.  The overall return on
               the variable account is dependent on multiple factors,  including
               the relative mix of the underlying  sub-accounts among bond funds
               and equity  funds,  as well as equity  sector  weightings.  Other
               significant   assumptions  include  surrender  and  lapse  rates,
               estimated interest spread, and estimated mortality.

               Due to the  relative  size and  sensitivity  to minor  changes in
               underlying  assumptions  of DAC and VOBA  balances,  the  Company
               performs a quarterly and annual  analysis of DAC and VOBA for the
               annuity  and  life  businesses,  respectively.  The DAC and  VOBA
               balances are evaluated for  recoverability and are reduced to the
               extent that  estimated  future gross  profits are  inadequate  to
               recover the asset.

               At each  evaluation  date,  actual  historical  gross profits are
               reflected,   and  estimated  future  gross  profits  and  related
               assumptions  are  evaluated  for  continued  reasonableness.  Any
               adjustment in estimated  profit  requires  that the  amortization
               rate be revised  ("unlocking")  retroactively  to the date of the
               policy  or  contract   issuance.   The  cumulative  prior  period
               adjustment  is  recognized  as  a  component  of  current  period


                                       19

<PAGE>

               amortization. In general, increases in investment, mortality, and
               expense  margins,  and thus estimated  future profits,  lower the
               rate  of   amortization.   However,   decreases  in   investment,
               mortality,   and  expense  margins,  and  thus  estimated  future
               profits, increase the rate of amortization.

               Analysis of DAC/VOBA - Annuity

               The actual  separate  account  return  exhibited  by the variable
               funds associated with the Company's  liabilities in 2004 exceeded
               the long-term  assumption,  thereby  producing for the year ended
               December 31, 2004  deceleration of DAC/VOBA  amortization of $0.1
               before tax, or $0.07, net of $0.03 of federal income tax expense.

               During 2003,  the Company  reset  long-term  assumptions  for the
               separate  account  returns  from 9.0% to 8.5% (gross  before fund
               management fees,  mortality,  expense, and other policy charges),
               reflecting a blended return of equity and other sub-accounts. The
               2003  unlocking  adjustment  was  driven  by this  change  in the
               separate account returns  assumption along with other prospective
               assumption  changes.  For the year ended  December 31, 2003,  the
               Company   recorded  an  acceleration  of  DAC/VOBA   amortization
               totaling $5.4 before tax, or $3.5,  net of $1.9 of federal income
               tax benefit.

               As part of the regular analysis of DAC/VOBA,  at the end of third
               quarter of 2002,  the  Company  unlocked  its  long-term  rate of
               return assumptions.  The Company reset long-term  assumptions for
               the  separate   account   returns  to  9.0%  (gross  before  fund
               management fees, mortality, expense, and other policy charges) as
               of December 31, 2002,  reflecting a blended  return of equity and
               other sub-accounts. The unlocking adjustment was primarily driven
               by the  sustained  downturn  in the equity  markets  and  revised
               expectations  for  future  returns.   During  2002,  the  Company
               recorded an acceleration of DAC/VOBA  amortization  totaling $1.5
               before tax, or $1.0, net of $0.5 of federal income tax benefit.

               Analysis of DAC/VOBA - Life

               As part of the regular  analysis of DAC/VOBA,  at the end of each
               of the years ended December 31, 2004, 2003, and 2002, the Company
               unlocked  its  long-term  rate  of  return   assumptions  due  to
               assumption  changes  related to  mortality,  lapse,  expense  and
               interest   amounts,   portfolio   return,  as  well  as  modeling
               improvements.  The impact of  unlocking  on the  amortization  of
               DAC/VOBA  was a decrease of $9.8 in 2004,  an increase of $5.5 in
               2003, and a decrease of $4.4 in 2002.


                                       20


<PAGE>


               Results of Operations

               Year ended  December 31, 2004 compared to year ended December 31,
               2003

               Income:  Income before  cumulative effect of change in accounting
               principles  decreased  by $23.1 to $30.8 for 2004 from  $53.9 for
               2003. The decrease in net income was primarily  related to higher
               mortality  cost and  operating  expenses,  partially  offset by a
               decrease in the amortization of DAC/VOBA.

               Net Investment Income: Net investment income decreased by $2.2 to
               $122.2 for 2004 from $124.4 for 2003.  The  decrease is primarily
               due to lower investment yields in 2004.

               Fee Income:  Fee income is  primarily  generated  through cost of
               insurance charges assessed to universal life  policyholders.  Fee
               income  for 2004 was  essentially  the same as in 2003.  Although
               universal life deposits  increased during 2004, the net amount at
               risk stayed  relatively flat in 2004 since the insurance in force
               amount was not significantly increased.

               Premiums: Premiums increased by $2.9 to $64.7 for 2004 from $61.8
               for 2003. The increase was primarily due to higher sales of group
               products.

               Net Realized  Capital Gains (Losses):  Net realized capital gains
               (losses)  decreased by $1.4 to $9.2 for 2004 from $10.6 for 2003.
               The  reduction in net  realized  gains was  primarily  due to the
               increasing  interest  rate  environment  in 2004 that  negatively
               affected  the market value of fixed  maturities  and led to lower
               realized gains upon sales.

               Interest  Credited  and  Other  Benefits  to  Contractowners  and
               Policyholders:   Interest   credited   and  other   benefits   to
               contractowners and policyholders increased by $41.5 to $189.0 for
               2004 from $147.5 for 2003.  The increase is primarily  related to
               higher life claims experienced in 2004 in comparison with 2003.

               Operating  Expenses:  Operating  expenses  increased  by $14.2 to
               $51.1 for 2004 from $36.9 for 2003.  The  increase  in  operating
               expenses  is  primarily  related  to the  general  growth  of the
               business, higher reinsurance-related  expenses, and a decrease in
               deferred expenses.

               Amortization  of DAC  and  VOBA:  Amortization  of DAC  and  VOBA
               decreased  by $21.5 to $9.4 for 2004 from  $30.9  for  2003.  The
               reduction in DAC and VOBA  amortization  primarily  resulted from
               the change of the Company's  amortization  rate due to assumption
               changes related to mortality,  lapse, expense,  interest amounts,
               portfolio   return,  as  well  as  modeling   improvements.   The
               assumption  changes  resulted in an increase in  amortization  in
               2003 and a decrease in amortization  in 2004. In addition,  there
               was no  amortization  recognized  for  the  defined  contribution
               annuity business in 2004 due to the write-off of DAC and VOBA for
               this part of the business in 2003.

               The Cumulative Effect of the Change in Accounting Principle:  The
               cumulative effect of the change in accounting principle for 2004,
               was $0.8  after tax,  related to the  adoption  of  Statement  of
               Position ("SOP") 03-1, "Accounting and Reporting by Insurance


                                       21

<PAGE>

               Enterprises for Certain  Nontraditional  Long-Duration  Contracts
               and for Separate Accounts",  and Technical Practice Aid 6300.05 -
               6300.08,  "Q&As  Related  to  the  Implementation  of  SOP  03-1,
               "Accounting  and Reporting by Insurance  Enterprises  for Certain
               Nontraditional   Long-Duration   Contracts   and   for   Separate
               Accounting"  (the  "TPA").   (See  "Recently  Adopted  Accounting
               Standards" for further information.)

               Financial Condition

               Investments

               Investment Strategy

               The  Company's   investment  strategy  for  its  general  account
               investments involves diversification by asset class, and seeks to
               add economic  diversification  and to reduce the risks of credit,
               liquidity,   and  embedded  options  within  certain   investment
               products,  such  as  convexity  risk on  collateralized  mortgage
               obligations and call options. The investment  management function
               is  centralized  under ING  Investment  Management,  LLC  ("IIM")
               pursuant to an investment advisory agreement. Separate portfolios
               are established for each general type of product within RLNY.

               The  Company  invests  its  general  account  primarily  in fixed
               maturity investments,  including publicly issued bonds (including
               government   bonds),    privately   placed   notes   and   bonds,
               mortgage-backed  securities,  and  asset-backed  securities.  The
               primary  investment  strategy  is to optimize  the  risk-adjusted
               return through superior asset selection predicated on a developed
               relative value approach, credit research and monitoring, superior
               management of interest rate risk, and active exploration into new
               investment product opportunities.  Investments are purchased when
               market returns, adjusted for risk and expenses, are sufficient to
               profitably support growth of the liability block of business.  In
               addition,  assets and  liabilities  are analyzed and reported for
               internal  management  purposes on an  option-adjusted  basis. The
               level of  required  capital  of given  transactions  is a primary
               factor in determining  relative value among different  investment
               and  liability  alternatives,  within  the scope of each  product
               type's   objective.   An  active  review  of  existing   holdings
               identifies  specific  assets that could be effectively  traded in
               order to enhance  the  risk-adjusted  returns  of the  portfolio,
               while minimizing adverse tax and accounting impacts.  The Company
               strives to maintain a portfolio  average asset quality  rating of
               A,  excluding  mortgage  loans,  but  including   mortgage-backed
               securities  that are  reported  with  bonds,  based on Standard &
               Poor's ratings classifications.


                                       22


<PAGE>


               Portfolio Composition

               The following table presents the investment portfolio at December
               31, 2004 and 2003:

               <TABLE>
               <S>                                              <C>                            <C>
                                                                           2004                           2003
                                                                ----------------------------   ----------------------------
                                                                 Carrying Value        %        Carrying Value        %
                                                                -----------------  ---------   -----------------  ---------
               Fixed maturities, including
                   securities pledged                            $       1,761.6      84.3%     $       1,719.8      84.5%
               Equity securities                                             7.6       0.4%                 6.7       0.3%
               Mortgage loans on real estate                               213.0      10.2%               209.7      10.3%
               Policy loans                                                 90.9       4.3%                86.6       4.3%
               Short-term investments                                          -       0.0%                 0.1       0.0%
               Other investments                                            17.0       0.8%                12.9       0.6%
                                                                -----------------  ---------   -----------------  ---------
                                                                 $       2,090.1     100.0%     $       2,035.8     100.0%
                                                                =================  =========   =================  =========
               </TABLE>

               Fixed Maturities

               Fixed maturities available-for-sale as of December 31, 2004, were
               as follows:

               <TABLE>
               <S>                                            <C>               <C>              <C>               <C>

                                                                                     Gross            Gross
                                                                 Amortized        Unrealized       Unrealized           Fair
                                                                   Cost              Gains           Losses             Value
                                                              ----------------  ---------------- ----------------  ----------------
               Fixed maturities:
               U.S. government and government
                 agencies and authorities                      $       56.2      $        0.4     $        0.2      $       56.4
               States, municipalities and political
                 subdivisions                                           1.6               0.1                -               1.7
               U.S. corporate securities:
                 Public utilities                                     154.3               7.9              0.8             161.4
                 Other corporate securities                           695.2              35.9              3.0             728.1
                                                              ----------------  ---------------- ----------------  ----------------
                   Total U.S. corporate securities                    849.5              43.8              3.8             889.5
                                                              ----------------  ---------------- ----------------  ----------------
               Foreign securities:
                 Government                                            28.0               0.6              0.2              28.4
                 Other                                                168.0               6.6              1.9             172.7
                                                              ----------------  ---------------- ----------------  ----------------
                   Total foreign securities                           196.0               7.2              2.1             201.1
                                                              ----------------  ---------------- ----------------  ----------------
             Residential mortgage-backed securities                   373.5               2.5              2.1             373.9
             Commercial mortgage-backed securities                    119.0               8.2              0.3             126.9
             Other asset-backed securities                            107.1               6.1              1.1             112.1
                                                              ----------------  ---------------- ----------------  ----------------
             Total fixed maturities, including
               fixed maturities pledged                             1,702.9              68.3              9.6           1,761.6
             Less: fixed maturities pledged                           149.7               0.3              1.5             148.5
                                                              ----------------  ---------------- ----------------  ----------------
             Total fixed maturities                            $    1,553.2      $       68.0     $        8.1      $    1,613.1
                                                              ================  ================ ================  ================

               </TABLE>


                                       23

<PAGE>


               Fixed maturities available-for-sale as of December 31, 2003, were
               as follows:

               <TABLE>
               <S>                                            <C>               <C>              <C>               <C>

                                                                                   Gross          Gross
                                                                  Amortized      Unrealized     Unrealized       Fair
                                                                     Cost          Gains          Losses        Value
                                                                 -------------  -------------  ------------- -------------
               Fixed maturities:
               U.S. government and government
                 agencies and authorities                         $     7.4      $     0.3      $       -     $     7.7
               States, municipalities and political
                 subdivisions                                           1.8            0.1              -           1.9
               U.S. corporate securities:
                 Public utilities                                     127.6            9.3            0.5         136.4
                 Other corporate securities                           732.5           48.3            5.9         774.9
                                                                 -------------  -------------  ------------- -------------
                   Total U.S. corporate securities                    860.1           57.6            6.4         911.3
                                                                 -------------  -------------  ------------- -------------
               Foreign securities:
                 Government                                            28.0            0.4            0.2          28.2
                 Other                                                141.2            6.9            2.8         145.3
                                                                 -------------  -------------  ------------- -------------
                   Total foreign securities                           169.2            7.3            3.0         173.5
                                                                 -------------  -------------  ------------- -------------
             Residential mortgage-backed securities                   399.7            4.0            1.3         402.4
             Commercial mortgage-backed securities                    106.1            9.6            0.3         115.4
             Other asset-backed securities                            100.3            8.6            1.3         107.6
                                                                 -------------  -------------  ------------- -------------
             Total fixed maturities, including
               fixed maturities pledged                             1,644.6           87.5           12.3       1,719.8
             Less: Fixed maturities pledged                           106.2            0.5            1.1         105.6
                                                                 -------------  -------------  ------------- -------------
             Total fixed maturities                               $ 1,538.4      $    87.0      $    11.2     $ 1,614.2
                                                                 =============  =============  ============= =============

             </TABLE>

               At December 31, 2004 and 2003,  net unrealized  appreciation  was
               $58.7  and  $75.2,  respectively,   on  total  fixed  maturities,
               including fixed maturities pledged to creditors.

               It  is  management's   objective  that  the  portfolio  of  fixed
               maturities be of high quality and be well  diversified  by market
               sector.  The fixed  maturities  in the  Company's  portfolio  are
               generally   rated  by  external   rating  agencies  and,  if  not
               externally rated, are rated by the Company on a basis believed to
               be  similar  to that used by the  rating  agencies.  The  average
               quality rating of the Company's fixed maturities portfolio was an
               A+ at December 31, 2004 and 2003.  Ratings are calculated using a
               rating   hierarchy  that  considers  S&P,  Moody's  and  internal
               ratings.


                                       24

<PAGE>


               Total fixed maturities by quality rating category including fixed
               maturities pledged to creditors were as follows as of:

               <TABLE>
               <S>                                <C>                           <C>

                                                                          December 31,
                                                             2004                          2003
                                                  ----------------------------  ---------------------------
                                                       Fair           % of           Fair          % of
                                                       Value          Total          Value         Total
                                                  -------------  -------------  ------------- -------------
               AAA                                 $   670.6          38.1%      $   674.2         39.2%
               AA                                       94.3           5.4%           97.9          5.7%
               A                                       408.7          23.2%          383.5         22.3%
               BBB                                     513.4          29.1%          462.7         26.9%
               BB                                       59.9           3.4%           84.5          4.9%
               B and below                              14.7           0.8%           17.0          1.0%
                                                  -------------  -------------  ------------- -------------
               Total                               $ 1,761.6         100.0%      $ 1,719.8        100.0%
                                                  =============  =============  ============= =============

              </TABLE>

               95.8%  and  94.1%  of  the  fixed  maturities  were  invested  in
               securities rated BBB and above (Investment Grade) at December 31,
               2004 and 2003, respectively.

               Fixed maturities rated BB and below (Below  Investment Grade) may
               have   speculative   characteristics   and  changes  in  economic
               conditions  or other  circumstances  are more likely to lead to a
               weakened  capacity of the issuer to make  principal  and interest
               payments than is the case with higher rated fixed maturities.

               Total  fixed   maturities  by  market  sector,   including  fixed
               maturities pledged to creditors were as follows as of:

               <TABLE>
               <S>                                <C>                           <C>

                                                                         December 31,
                                                               2004                         2003
                                                  ----------------------------  ---------------------------
                                                       Fair           % of           Fair          % of
                                                       Value          Total          Value         Total
                                                  -------------  -------------  ------------- -------------
               U.S. Corporate                      $   891.2          50.6%      $   913.2         53.1%
               Residential Mortgage-backed             373.9          21.2%          402.4         23.4%
               Commercial/Multifamily
                 Mortgage-backed                       126.9           7.2%          115.4          6.7%
               Foreign (1)                             201.1          11.4%          173.5         10.1%
               U.S. Treasuries/Agencies                 56.4           3.2%            7.7          0.4%
               Asset-backed                            112.1           6.4%          107.6          6.3%
                                                  -------------  -------------  ------------- -------------
               Total                               $ 1,761.6         100.0%      $ 1,719.8        100.0%
                                                  =============  =============  ============= =============

               (1) Primarily U.S. dollar denominated.

               </TABLE>


                                       25

<PAGE>



               The amortized  cost and fair value of total fixed  maturities for
               the  year-ended  December 31, 2004 are shown below by contractual
               maturity.   Actual   maturities   may  differ  from   contractual
               maturities  because  securities may be restructured,  called,  or
               prepaid.

               <TABLE>
               <S>                                            <C>               <C>

                                                                 Amortized            Fair
                                                                    Cost              Value
                                                              ----------------  ----------------
               Due to mature:
               One year or less                                $     41.0        $     41.8
               After one year through five years                    456.7             474.4
               After five years through ten years                   285.1             297.9
               After ten years                                      320.5             334.6
               Mortgage-backed securities                           492.5             500.8
               Other asset-backed securities                        107.1             112.1
               Less: fixed maturities pledged                       149.7             148.5
                                                              ----------------  ----------------
               Fixed maturities, excluding fixed
                 maturities pledged                            $  1,553.2        $  1,613.1
                                                              ================  ================

              </TABLE>

               The  Company  did not have any  investments  in a single  issuer,
               other than  obligations of the U.S.  government,  with a carrying
               value in excess of 10% of the Company's  shareholder's  equity at
               December 31, 2004.

               At December 31, 2004 and 2003,  fixed maturities with fair values
               of $6.0 and $6.1,  respectively,  were on deposit as  required by
               regulatory authorities.

               Mortgage Loans

               Mortgage loans,  primarily  commercial  mortgage  loans,  totaled
               $213.0 at  December  31, 2004 and $209.7 at  December  31,  2003.
               These  loans are  reported  at  amortized  cost  less  impairment
               writedowns. If the value of any mortgage loan is determined to be
               impaired  (i.e.,  when it is probable  that the  Company  will be
               unable to collect on all amounts due according to the contractual
               terms of the loan agreement),  the carrying value of the mortgage
               loan is reduced  to either the  present  value of  expected  cash
               flows,  cash  flows  from  the  loan  (discounted  at the  loan's
               effective interest rate), or fair value of the collateral. If the
               loan is in foreclosure, the carrying value is reduced to the fair
               value of the  underlying  collateral,  net of estimated  costs to
               obtain and sell.  The  carrying  value of the  impaired  loans is
               reduced  by  establishing  a  permanent  write  down  charged  to
               realized  loss. At December 31, 2004 and 2003, the Company had no
               allowance for mortgage loan credit losses.

               Other-Than-Temporary-Impairments

               The Company analyzes the general account investments to determine
               whether  there has been an  other-than-temporary  decline in fair
               value below the amortized  cost basis.  Management  considers the
               length of the time and the extent to which the  market  value has
               been  less than  cost;  the  financial  condition  and  near-term
               prospects of the issuer;  future  economic  conditions and market
               forecasts;  and the  Company's  intent and  ability to retain the


                                       26

<PAGE>

               investment in the issuer for a period of time sufficient to allow
               for recovery in market value.  If it is probable that all amounts
               due according to the contractual  terms of an investment will not
               be collected, an other-than-temporary impairment is considered to
               have occurred.

               In addition,  the Company  invests in structured  securities that
               meet the criteria of Emerging  Issues Task Force  ("EITF")  Issue
               No.  99-20,  "Recognition  of Interest  Income and  Impairment on
               Purchased  and  Retained  Beneficial   Interests  in  Securitized
               Financial Assets." Under EITF Issue No. 99-20, a determination of
               the  required   impairment  is  based  on  credit  risk  and  the
               possibility  of  significant  prepayment  risk that restricts the
               Company's  ability to recover the  investment.  An  impairment is
               recognized  if the market value of the security is less than book
               value and there has been an adverse change in cash flow since the
               last remeasurement date.

               When   a   decline   in   fair   value   is   determined   to  be
               other-than-temporary,  the individual security is written down to
               fair value and the loss is accounted for as a realized loss.

               The following table identifies the Company's other-than-temporary
               impairments by type as of December 31:

               <TABLE>
               <S>                    <C>                         <C>                        <C>

                                                  2004                        2003                       2002
                                      --------------------------- -------------------------- --------------------------
                                                        No. of                     No. of                     No. of
                                        Impairment    Securities    Impairment   Securities    Impairment   Securities
                                      -------------  ------------ ------------- ------------ ------------- ------------
               U.S. Corporate          $     0.8           1       $    2.7           2       $    0.7           1
               Asset-backed                    -           -            2.0           6            2.3           7
               Equity                          -           -            0.1           1            0.1           1
               Limited Partnerships          0.1           2              -           -              -           -
                                      -------------  ------------ ------------- ------------ ------------- ------------
Total                                  $     0.9           3       $    4.8           9       $    3.1           9
                                      =============  ============ ============= ============ ============= ============

               </TABLE>

               The remaining fair value of impaired fixed maturities at December
               2004, 2003, and 2002 was $4.0, $7.5 and $25.9, respectively.

               Net Realized Capital Gains and Losses

               Net  realized   capital  gains  (losses)  are  comprised  of  the
               difference between the carrying value of investments and proceeds
               from sale, maturity,  and redemption,  as well as losses incurred
               due to the  other-than-temporary  impairment of investments.  Net
               realized capital gains (losses) on investments were as follows:

<TABLE>
<S>                                                             <C>                <C>                <C>

                                                                                Year ended December 31,
                                                                      2004                2003               2002
                                                               -----------------   -----------------  -----------------
               Fixed maturities                                 $      9.3          $     10.2         $     (2.5)
               Equity securities                                         -                (0.1)               0.2
               Other                                                  (0.1)                0.5               (0.9)
                                                               -----------------   -----------------  -----------------
               Pretax net realized capital gains (losses)       $      9.2          $     10.6         $     (3.2)
                                                               =================   =================  =================
               After-tax net realized capital gains (losses)    $      6.0          $      6.9         $     (2.1)
                                                               =================   =================  =================

               </TABLE>


                                       27

<PAGE>

               Liquidity and Capital Resources

               Liquidity  is the ability of the  Company to generate  sufficient
               cash flows to meet the cash requirements of operating, investing,
               and financing activities.

               Sources and Uses of Liquidity

               The  Company's  principal  sources  of  liquidity  are  premiums,
               product charges,  investment  income,  proceeds from the maturing
               and sale of investments, proceeds from debt issuance, and capital
               contributions.  Primary  uses of  these  funds  are  payments  of
               commissions and operating expenses, interest and premium credits,
               investment  purchases  and repayment of debt, as well as contract
               maturities, withdrawals and surrenders.

               The  Company's  liquidity  position  is  managed  by  maintaining
               adequate   levels  of  liquid  assets,   such  as  cash  or  cash
               equivalents and short-term investments.  For a description of the
               Company's asset/liability  management, see Item 7A, "Quantitative
               and Qualitative Disclosures About Market Risk."

               Additional  sources of liquidity include borrowing  facilities to
               meet  short-term  cash  requirements.  The  Company  maintains  a
               reciprocal  loan agreement with ING America  Insurance  Holdings,
               Inc. ("ING AIH"),  a Delaware  corporation  and affiliate.  Under
               this  agreement,  during  the  period  from  February  1, 2003 to
               January 31,  2004 and during the period from  February 1, 2004 to
               January 31,  2005,  the Company and ING AIH could borrow from one
               another up to 5% of RLNY's  statutory  admitted  assets as of the
               preceding  December  31. The Company  also  maintains a perpetual
               $30.0  revolving  note facility with Bank of New York and a $30.0
               revolving note facility with SunTrust Bank. At December 31, 2004,
               the  Company  had  a  $2.3  balance  payable  to  SunTrust  Bank.
               Management  believes that these sources of liquidity are adequate
               to meet the Company's short-term cash obligations.

               Capital Contributions and Dividends

               The Company  paid  $27.2,  $25.5 and $14.4 in cash  dividends  to
               ReliaStar Life Insurance Company ("ReliaStar Life") in 2004, 2003
               and 2002, respectively.

               The  Company did not receive  capital  contributions  in 2004 and
               2003. The Company received capital contributions of $31.4 in 2002
               from      Security-Connecticut     Life     Insurance     Company
               ("Security-Connecticut"),  related to the First  Golden  American
               Life Insurance  Company of New York ("First  Golden") merger with
               and into the Company.


                                       28

<PAGE>


               Separate Accounts

               Separate account assets and liabilities generally represent funds
               maintained   to   meet   specific   investment    objectives   of
               contractowners  and  policyholders  who bear the investment risk,
               subject,   in  limited  cases,  to  minimum   guaranteed   rates.
               Investment  income  and  investment  gains and  losses  generally
               accrue directly to such  contractowners  and  policyholders.  The
               assets of each account are legally segregated and are not subject
               to claims that arise out of any other business of the Company.

               Separate  Account  assets   supporting   variable  options  under
               universal life and annuity contracts are invested,  as designated
               by the  contractowner/policyholder  or participant (who bears the
               investment risk subject,  in limited cases, to minimum guaranteed
               rates)  under a  contract  in shares of  mutual  funds  which are
               managed by the Company or its  affiliates,  or in other  selected
               mutual  funds  not  managed  by the  Company  or its  affiliates.
               Variable  universal  life and annuity  premiums are  allocated to
               various subaccounts established within the separate account. Each
               subaccount  represents a different investment option in which the
               contractowner  may  allocate  premiums.  The  account  value of a
               variable  universal  life or  annuity  contract  is  equal to the
               aggregate value of the subaccounts  selected by the contractowner
               (including  the value  allocated to any fixed  account) less fees
               and  expenses.  The  Company  offers  investment  options for its
               variable  universal  life and annuities  covering a wide range of
               investment  styles,  including  large,  mid and small cap  equity
               funds, as well as fixed income  alternatives.  Therefore,  unlike
               fixed annuities,  under variable universal life and annuities the
               contractowners  bear  the risk of  investment  gains  and  losses
               associated with the selected investment allocation.

               Off-Balance   Sheet   Arrangements   and  Aggregate   Contractual
               Obligations

               Through the normal course of investment  operations,  the Company
               commits  to  either  purchase  or  sell  securities,   commercial
               mortgage loans, or money market instruments at a specified future
               date  and  at a  specified  price  or  yield.  The  inability  of
               counterparties  to honor these commitments may result in either a
               higher or lower  replacement  cost. Also, there is likely to be a
               change in the value of the securities underlying the commitments.
               At December 31, 2004 and 2003, the Company had off-balance  sheet
               commitments to purchase  investments equal to their fair value of
               $15.4 and $28.9, respectively.


                                       29

<PAGE>


               As of December  31,  2004,  the  Company had certain  contractual
               obligations  due  over a  period  of  time as  summarized  in the
               following table:

               <TABLE>
               <S>                                   <C>           <C>           <C>           <C>           <C>

                                                                           Payments due by Period
                                                     --------------------------------------------------------------------
                                                                    Less than                                 More than
               Contractual Obligations                  Total        1 Year       1-3 Years     3-5 Years      5 Years
               ---------------------------           ------------  ------------  ------------  ------------  ------------
               Operating Lease Obligations            $     0.4     $   0.1       $    0.2       $   0.1      $       -
               Purchase Obligations                        15.4        15.4              -             -              -
               Reserves for Insurance Obligations       1,623.5        93.3          163.1         166.9        1,200.2
                                                     ------------  ------------  ------------  ------------  ------------
                 Total                                $ 1,639.3     $ 108.8       $  163.3       $ 167.0      $ 1,200.2
                                                     ============  ============  ============  ============  ============

               </TABLE>

               Operating lease obligations  relate to the rental of office space
               under various  non-cancelable  operating  lease  agreements  that
               expire through January 2009.

               Purchase obligations consist primarily of commitments to purchase
               investments during 2005.

               Reserves  for  insurance   obligations   consist  of  actuarially
               determined  amounts  required  for the Company to meet its future
               obligations under its universal life policies, variable universal
               life  policies,  traditional  life  policies,  fixed and variable
               annuity  contracts,  accident and health  policies,  supplemental
               contracts and miscellaneous supplemental benefits and riders.

               Reinsurance

               The  Company  utilizes  reinsurance   agreements  to  reduce  its
               exposure  to  large  losses  in  all  aspects  of  its  insurance
               business.  Such  reinsurance  permits  recovery  of a portion  of
               losses  from  reinsurers,  although  it does  not  discharge  the
               primary  liability of the Company as direct  insurer of the risks
               reinsured.  The  Company  evaluates  the  financial  strength  of
               potential  reinsurers  and  continually  monitors  the  financial
               condition  of  reinsurers.  Only  those  reinsurance  recoverable
               balances  deemed  probable of recovery are reflected as assets on
               the Company's Balance Sheets.

               Repurchase Agreements

               The  Company  engages in dollar  repurchase  agreements  ("dollar
               rolls")  and  repurchase  agreements  to  increase  its return on
               investments and improve liquidity.  These transactions  involve a
               sale of securities  and an agreement to repurchase  substantially
               the same  securities as those sold.  Company  policies  require a
               minimum  of 95% of the fair  value of  securities  pledged  under
               dollar  rolls  and  repurchase   agreement   transactions  to  be
               maintained as collateral. Cash collateral received is invested in
               fixed  maturities  and the  offsetting  collateral  liability  is
               included in borrowed money on the Balance Sheets. At December 31,
               2004 and 2003, the carrying  value of the  securities  pledged in
               dollar rolls and repurchase agreement transactions was $100.7 and
               $103.8,  respectively.  The  carrying  value  of  the  securities
               pledged in dollar rolls and repurchase agreement  transactions is


                                       30

<PAGE>


               included  in  pledged  securities  on  the  Balance  Sheets.  The
               repurchase  obligation  related  to dollar  rolls and  repurchase
               agreements  totaled  $100.4 and $101.5 at  December  31, 2004 and
               2003, respectively.

               The Company also enters into reverse repurchase agreements. These
               transactions involve a purchase of securities and an agreement to
               sell  substantially  the  same  securities  as  those  purchased.
               Company  policies  require a minimum of 102% of the fair value of
               securities  pledged  under  reverse  repurchase  agreements to be
               pledged  as  collateral.  At  December  31,  2004 and  2003,  the
               carrying value of the securities in reverse repurchase agreements
               was $32.0 and $8.0, respectively.

               The  primary  risk  associated  with  short-term   collateralized
               borrowings  is that the  counterparty  will be unable to  perform
               under  the  terms of the  contract.  The  Company's  exposure  is
               limited  to  the  excess  of  the  net  replacement  cost  of the
               securities  over the  value  of the  short-term  investments,  an
               amount that was not material at December  31,  2004.  The Company
               believes the  counterparties  to the dollar roll,  repurchase and
               reverse  repurchase  agreements are  financially  responsible and
               that the counterparty risk is immaterial.

               Securities Lending

               The  Company  engages  in  securities   lending  whereby  certain
               securities  from its portfolio  are loaned to other  institutions
               for short periods of time. Initial collateral, primarily cash, is
               required  at a rate of 102% of the  market  value  of the  loaned
               domestic securities.  The collateral is deposited by the borrower
               with a lending  agent,  and  retained and invested by the lending
               agent   according  to  the   Company's   guidelines  to  generate
               additional  income.  The market value of the loaned securities is
               monitored on a daily basis with additional collateral obtained or
               refunded as the fair value of the loaned securities fluctuates.

               Risk-based Capital

               The  National  Association  of Insurance  Commissioners  ("NAIC")
               risk-based capital  requirements  require insurance  companies to
               calculate  and  report  information  under a  risk-based  capital
               formula.  These  requirements  are  intended  to allow  insurance
               regulators to monitor the  capitalization of insurance  companies
               based upon the type and mixture of risks  inherent in a Company's
               operations.  The  formula  includes  components  for asset  risk,
               liability risk,  interest rate exposure,  and other factors.  The
               Company has complied with the NAIC's risk-based capital reporting
               requirements.  Amounts reported  indicate that as of December 31,
               2004 the Company has total  adjusted  capital  above all required
               capital levels.



                                       31

<PAGE>

               Recently Adopted Accounting Standards
               (See Si1gnificant  Accounting  Policies Footnote to the Financial
               Statements for further information.)

               Accounting  and  Reporting by Insurance  Enterprises  for Certain
               Nontraditional Long-Duration Contracts and for Separate Accounts

               The  Company  adopted  SOP  03-1 on  January  1,  2004.  SOP 03-1
               establishes  several new accounting  and disclosure  requirements
               for  certain  nontraditional   long-duration  contracts  and  for
               separate  accounts  including,  among other things, a requirement
               that assets and liabilities of separate account arrangements that
               do not meet certain  criteria be accounted for as general account
               assets and liabilities,  and the revenues and expenses related to
               such  arrangements be consolidated with the respective line items
               in the  Statements of Operations.  In addition,  the SOP requires
               additional  liabilities  be  established  for certain  guaranteed
               death benefits and for products with certain  patterns of cost of
               insurance charges.  Sales inducements  provided to contractowners
               and  policyholders  must also be  recognized on the balance sheet
               separately  from  deferred  acquisition  costs and amortized as a
               component of benefits  expense using  methodology and assumptions
               consistent  with those used for  amortization  of deferred policy
               acquisition costs.

               The Company evaluated all requirements of SOP 03-1 and determined
               that it is  affected  by the SOP's  requirements  to account  for
               certain   separate   account   arrangements  as  general  account
               arrangements,  to establish  additional  liabilities  for certain
               guaranteed  benefits  and for products  with  patterns of cost of
               insurance  charges  that  result in gains  followed  by losses in
               later policy durations from the insurance benefit  function,  and
               to defer and amortize  sales  inducements to  contractowners  and
               policyholders. Upon adoption of the SOP, the Company recognized a
               cumulative effect of a change in accounting principle of $(10.8),
               before tax or $(7.0),  net of $3.8 of income taxes, as of January
               1, 2004.

               In the fourth quarter of 2004, the cumulative  effect of a change
               in accounting  principle was revised due to the implementation of
               the TPA.

               The  TPA,  which  was  approved  in  September   2004,   provides
               additional  guidance regarding certain implicit  assessments that
               may  be  used  in  testing  of the  base  mortality  function  on
               contracts,  which is performed to  determine  whether  additional
               liabilities  are  required  in  conjunction  with  SOP  03-1.  In
               addition,  the TPA provides additional  guidance  surrounding the
               allowed level of aggregation of additional liabilities determined
               under the SOP.  While the TPA was  implemented  during the fourth
               quarter  of  2004,  the  TPA  was  retroactive  to  the  original
               implementation date of SOP 03-1, January 1, 2004 and was reported
               as an adjustment to SOP 03-1's  cumulative  effect of a change in
               accounting  principle.  The  adoption  of the TPA  increased  the
               Company's  cumulative  effect change in  accounting  principle by
               $7.8, net of $4.2 of income tax.

               The  implementation  of SOP 03-1 raised  questions  regarding the
               interpretation of the requirements of FAS No. 97, concerning when
               it is appropriate to record an unearned revenue liability related
               to the insurance benefit function.  To clarify its position,  the
               Financial  Accounting  Standards Board ("FASB") issued FASB Staff
               Position  No. FAS 97-1  ("FSP FAS  97-1"),  "Situations  in Which


                                       32


<PAGE>


               Paragraphs 17(b) and 20 of FASB Statement No. 97, `Accounting and
               Reporting  by  Insurance  Enterprises  for Certain  Long-Duration
               Contracts  and for  Realized  Gains and  Losses  from the Sale of
               Investments,'  Permit or Require  Accrual of an Unearned  Revenue
               Liability,"  effective for fiscal periods beginning subsequent to
               the date the  guidance  was issued,  June 18,  2004.  The Company
               adopted  FSP FAS 97-1 on July 1, 2004.  The  adoption  of FSP FAS
               97-1 did not have an impact on the Company's  financial position,
               results of operations, or cash flows.

               New Accounting Pronouncements

               In December  2004,  the FASB issued FAS No. 123  (revised  2004),
               "Share-Based   Payment"   ("FAS   123R"),   which   requires  all
               share-based  payments to employees be recognized in the financial
               statements  based upon the fair value.  FAS 123R is  effective at
               the  beginning of the first  interim or annual  period  beginning
               after June 15, 2005.  Earlier  adoption is  encouraged.  FAS 123R
               provides  two  transition   methods,   modified-prospective   and
               modified-retrospective.

               The  modified-prospective  method  recognizes the grant-date fair
               value of compensation  for new awards granted after the effective
               date and unvested awards  beginning in the fiscal period in which
               the recognition  provisions are first applied.  Prior periods are
               not restated. The modified-retrospective  method permits entities
               to restate prior periods by  recognizing  the  compensation  cost
               based on the amount previously reported in the pro forma footnote
               disclosures  as  required  under  FAS No.  123,  "Accounting  for
               Stock-Based Compensation".

               The Company  intends to early adopt the provisions of FAS 123R on
               January 1, 2005, using the  modified-prospective  method.  Due to
               the Company's  few number of employees,  the adoption of FAS 123R
               is not  expected  to  have a  material  impact  on the  Company's
               financial position,  results of operations,  or cash flows. Prior
               to January 2005,  the Company  applied the intrinsic  value-based
               provisions  set  forth in  Accounting  Principles  Board  ("APB")
               Opinion No. 25, "Accounting for Stock Issued to Employees". Under
               the intrinsic value method, compensation expense is determined on
               the measurement  date,  which is the first date on which both the
               number of shares the  employee  is  entitled  to receive  and the
               exercise  price  are  known.  Compensation  expense,  if any,  is
               measured  based  on the  award's  intrinsic  value,  which is the
               excess of the market price of the stock over the  exercise  price
               on the measurement date.

               Legislative Initiatives

               Certain elements of the Jobs and Growth Tax Relief Reconciliation
               Act of 2003,  in  particular  the  reduction  in the tax rates on
               long-term capital gains and corporate  dividends could impact the
               relative  competitiveness  of the Company's  products  especially
               variable annuities.  While sales of the products do not appear to
               have been  reduced to date,  the long term effect of the Jobs and
               Growth Tax  Relief  Reconciliation  Act of 2003 on the  Company's
               financial condition or results of operation can not be reasonably
               estimated at this time.


                                       33

<PAGE>


               The  American   Jobs   Creation  Act  of  2004  allows   tax-free
               distributions  to  be  made  from  the  Company's  Policyholders'
               Surplus  Account in 2005 and 2006.  Under prior law,  the Company
               was allowed to defer from taxation a portion of statutory  income
               under certain circumstances.  The deferred income was accumulated
               in the  Policyholders'  Surplus Account and is taxable only under
               conditions that management considers to be remote.  Therefore, no
               federal  income  taxes  have  been  provided  on the  accumulated
               balance of $11.3 as of  December  31,  2004.  Based on  currently
               available  information,  the Company anticipates that the new law
               will  permanently  eliminate any potential tax on the accumulated
               balance of $11.3.

               Other legislative proposals under consideration include repealing
               the estate  tax,  reducing  the  taxation  of  annuity  benefits,
               changing the taxation of products,  and changing  life  insurance
               company taxation. Some of these proposals, if enacted, could have
               a  material  effect  on  life  insurance,   annuity,   and  other
               retirement  savings  product  sales.  The impact on the Company's
               products cannot be predicted.

               Legislation to restructure  the Social Security System and expand
               private pension plan incentives also may be considered. Prospects
               for  enactment  and the ultimate  effect of these  proposals  are
               uncertain.

               Regulatory Matters

               As with many financial  services  companies,  the Company and its
               affiliates  have  received   informal  and  formal  requests  for
               information from various state and federal governmental  agencies
               and  self-regulatory  organizations  in connection with inquiries
               and investigations of the products and practices of the financial
               services  industry.  In each case, the Company and its affiliates
               have been and are providing full cooperation.

               Fund Regulatory Issues

               Since 2002, there has been increased  governmental and regulatory
               activity   relating  to  mutual  funds  and  variable   insurance
               products.  This activity has primarily  focused on  inappropriate
               trading of fund shares,  revenue sharing and directed  brokerage,
               compensation, sales practices and suitability,  arrangements with
               service providers, pricing, compliance and controls, and adequacy
               of disclosure.

               In addition to responding to governmental and regulatory requests
               on fund regulatory issues, ING management, on its own initiative,
               conducted,  through  special  counsel  and a national  accounting
               firm, an extensive  internal review of mutual fund trading in ING
               insurance, retirement, and mutual fund products. The goal of this
               review was to identify any instances of inappropriate  trading in
               those   products   by  third   parties   or  by  ING   investment
               professionals and other ING personnel.


                                       34


<PAGE>


               The internal  review  identified  several  isolated  arrangements
               allowing  third  parties to engage in frequent  trading of mutual
               funds within the variable  insurance  and mutual fund products of
               certain   affiliates  of  the  Company,   and  identified   other
               circumstances  where frequent  trading  occurred despite measures
               taken  by ING  intended  to  combat  market  timing.  Each of the
               arrangements has been terminated and disclosed to regulators,  to
               the  independent  trustees  of ING Funds  (U.S.)  and in  Company
               reports   previously  filed  with  the  Securities  and  Exchange
               Commission  ("SEC")  pursuant to the  Securities  Exchange Act of
               1934, as amended.

               An affiliate of the Company, ING Funds Distributors,  LLC ("IFD")
               has received notice from the staff of the National Association of
               Securities Dealers ("NASD") that the staff has made a preliminary
               determination  to recommend that  disciplinary  action be brought
               against IFD and one of its  registered  persons for violations of
               the NASD Conduct Rules and federal  securities laws in connection
               with frequent trading arrangements.

               Other  regulators,  including  the SEC and the New York  Attorney
               General,  are also  likely to take some  action  with  respect to
               certain ING affiliates before  concluding their  investigation of
               ING  relating  to fund  trading.  The  potential  outcome of such
               action  is  difficult  to  predict  but  could  subject   certain
               affiliates to adverse  consequences,  including,  but not limited
               to,   settlement   payments,   penalties,   and  other  financial
               liability.  It is not currently  anticipated,  however,  that the
               actual outcome of such action will have a material adverse effect
               on ING or ING's U.S.-based operations, including the Company.

               ING has agreed to indemnify  and hold harmless the ING Funds from
               all  damages  resulting  from  wrongful  conduct  by  ING  or its
               employees   or   from   ING's   internal    investigation,    any
               investigations  conducted by any governmental or  self-regulatory
               agencies,  litigation or other formal proceedings,  including any
               proceedings  by the SEC.  Management  reported  to the ING  Funds
               Board that ING  management  believes that the total amount of any
               indemnification  obligations will not be material to ING or ING's
               U.S.-based operations, including the Company.

               Other Regulatory Matters

               The New York  Attorney  General  and  other  regulators  are also
               conducting  broad  inquiries  and  investigations  involving  the
               insurance industry.  These initiatives  currently focus on, among
               other things, compensation and other sales incentives,  potential
               conflicts  of  interest,   potential  anti-competitive  activity,
               marketing practices,  certain financial reinsurance arrangements,
               and   disclosure.   It  is   likely   that  the  scope  of  these
               investigations will further broaden before the investigations are
               concluded.  U.S.  affiliates  of ING  have  received  formal  and
               informal requests in connection with such investigations, and are
               cooperating fully with each request for information.


                                       35

<PAGE>


               These  initiatives  may result in new  legislation and regulation
               that could significantly  affect the financial services industry,
               including businesses in which the Company is engaged.

               In light of these and other developments, U.S. affiliates of ING,
               including the Company,  periodically review whether modifications
               to their business practices are appropriate.

               For further discussion of the Company's  regulatory matters,  see
               "Risk Factors" in Part I, Item 1 "Business."


                                       36

<PAGE>


Item 7A.       Quantitative and Qualitative Disclosures About Market Risk

               Asset/liability management is integrated into many aspects of the
               Company's  operations,  including investment  decisions,  product
               development, and determination of crediting rates. As part of the
               risk  management   process,   different  economic  scenarios  are
               modeled,  including  cash flow  testing  required  for  insurance
               regulatory  purposes,  to  determine  that  existing  assets  are
               adequate to meet projected liability cash flows. Key variables in
               the  modeling   process  include   interest  rates,   anticipated
               contractowner  or policyholder  behavior,  and variable  separate
               account  performance.  Contractowners  and policyholders bear the
               majority of the  investment  risk  related to variable  insurance
               products.

               The fixed account  liabilities are supported by a general account
               portfolio  principally  composed of fixed rate  investments  with
               matching duration  characteristics that can generate predictable,
               steady rates of return. The portfolio management strategy for the
               fixed  account  considers  the  assets  available-for-sale.  This
               enables  the  Company to  respond  to changes in market  interest
               rates,  changes in prepayment risk, changes in relative values of
               asset sectors and  individual  securities  and loans,  changes in
               credit quality outlook, and other relevant factors. The objective
               of  portfolio  management  is to  maximize  returns,  taking into
               account  interest  rate and credit risk,  as well as other risks.
               The  Company's  asset/liability  management  discipline  includes
               strategies  to minimize  exposure  to loss as interest  rates and
               economic and market conditions change.

               Term life  products  for  employee  benefits  are  short  term in
               nature,  with some longer term claim reserves.  Cash flow testing
               and  additional  sensitivity  testing  (with  varying  mortality,
               morbidity,   and  expense  levels)  provide  assurance  that  the
               existing  assets are adequate to meet  projected  liability  cash
               flows.

               For  universal  life  products,   cash  flow  testing  of  higher
               mortality,  surrender,  and expense levels than expected indicate
               that solvency is not impaired by  reasonable  variations in these
               risks. The current difference between the charges to the policies
               for cost of insurance  and expenses and the  guaranteed  maximums
               allows some margin for adverse  experience.  Crediting  rates are
               also changed regularly to reflect changes in the portfolio.

               On the  basis of these  analyses,  management  believes  there is
               currently no material solvency risk to the Company.

               Interest Rate Risk

               The Company defines interest rate risk as the risk of an economic
               loss due to adverse changes in interest  rates.  This risk arises
               from the Company's  primary  activity of investing  premiums from
               interest-sensitive  life insurance and fixed annuity  business in
               interest-sensitive  fixed income assets and carrying  these funds
               as  interest-sensitive   liabilities.  The  Company  manages  the
               interest  rate risk in its assets  relative to the interest  rate
               risk in its  liabilities.  A key measure  used to  quantify  this


                                       37


<PAGE>


               exposure is duration.  Duration  measures the  sensitivity of the
               market or "fair"  value of assets and  liabilities  to changes in
               interest rates.

               To calculate  duration of  interest-sensitive  life insurance and
               fixed annuity  liabilities,  the Company projects  liability cash
               flows under  stochastic,  arbitrage-free  interest rate scenarios
               and calculates  their net present value using LIBOR or swap based
               interest  rates.  Duration is calculated by revaluing  these cash
               flows given a small change in interest rates and  determining the
               percentage  change in the net present value.  The cash flows used
               in  this  calculation   include  all  premiums,   benefits,   and
               policy-related  expenses on the  interest-sensitive  liabilities.
               The projections  include  assumptions  that reflect the effect of
               changing interest rates on the Company's  declared credited rates
               and policyholder lapses, where applicable.

               For further  discussion of the Company's interest rate risks, see
               "Risk Factors" in Part 1, Item 1 "Business".


                                       38


<PAGE>


Item 8.         Financial Statements and Supplementary Data

                          Index to Financial Statements

                                                                            Page

Report of Independent Registered Public Accounting Firm                      40

Financial Statements:

     Statements of Operations for the years ended December 31,
     2004, 2003 and 2002                                                     41

     Balance Sheets as of December 31, 2004 and 2003                         42

     Statements of Changes in Shareholder's Equity for the years
     ended December 31, 2004, 2003 and 2002                                  44

     Statements of Cash Flows for the years ended December 31, 2004,
     2003 (restated) and 2002 (restated)                                     45

Notes to Financial Statements                                                47


<PAGE>



             Report of Independent Registered Public Accounting Firm


The Board of Directors
ReliaStar Life Insurance Company of New York

We have audited the  accompanying  balance  sheets of ReliaStar  Life  Insurance
Company of New York as of December 31, 2004 and 2003, and the related statements
of operations, changes in shareholder's equity, cash flows for each of the three
years in the period ended December 31, 2004. These financial  statements are the
responsibility of the Company's management.  Our responsibility is to express an
opinion on these financial statements based on our audits.

We conducted our audits in accordance  with the standards of the Public  Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement.  We were not engaged to perform an
audit of the Company's  internal  control over  financial  reporting.  Our audit
included  consideration of internal control over financial  reporting as a basis
for designing audit  procedures that are appropriate in the  circumstances,  but
not for the purpose of an opinion on the effectiveness of the Company's internal
control over financial  reporting.  Accordingly,  we express no such opinion. An
audit also includes examining,  on a test basis, evidence supporting the amounts
and disclosures in the financial statements, assessing the accounting principles
used and  significant  estimates made by management,  and evaluating the overall
financial  statement  presentation.   We  believe  that  our  audits  provide  a
reasonable basis for our opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all material  respects,  the consolidated  financial  position of ReliaStar Life
Insurance  Company of New York as of December 31, 2004 and 2003, and the results
of its  operations  and its cash flows for each of the three years in the period
ended December 31, 2004, in conformity with U.S. generally  accepted  accounting
principles.

As  discussed in Note 1 to the  financial  statements,  the Company  changed the
accounting  principle for goodwill and other intangible assets effective January
1, 2002 and changed the accounting  principle for certain  non-traditional  long
duration  contracts  and for separate  accounts  effective  January 1, 2004.  As
discussed in Note 15 to the financial  statements,  the Company restated certain
amounts  presented in the  statements  of cash flows  related to its  short-term
investments  and  interest  credited  to  contractholders  for  investment  type
contracts for the years ended December 31, 2003 and 2002.


                                                          /s/ Ernst & Young LLP

Atlanta, Georgia
March 31, 2005


<PAGE>



                  ReliaStar Life Insurance Company of New York
         (A wholly-owned subsidiary of ReliaStar Life Insurance Company)

                            Statements of Operations
                                  (In millions)

<TABLE>
<S>                                                         <C>                <C>                 <C>

                                                                            Year ended December 31,
                                                                  2004               2003                2002
                                                            -----------------  ------------------  -----------------
Revenues:
    Net investment income                                            $ 122.2             $ 124.4            $ 133.1
    Fee income                                                          95.9                94.7               98.2
    Premiums                                                            64.7                61.8               55.0
    Net realized capital gains (losses)                                  9.2                10.6               (3.2)
    Other income                                                         4.9                 4.0                5.5
                                                            -----------------  ------------------  -----------------
Total revenue                                                          296.9               295.5              288.6
                                                            -----------------  ------------------  -----------------
Benefits and expenses:
    Interest credited and other benefits
      to contractowners and policyholders                              189.0               147.5              176.3
    Operating expenses                                                  51.1                36.9               29.3
    Amortization of deferred policy acquisition costs
      and value of business acquired                                     9.4                30.9               32.6
                                                            -----------------  ------------------  -----------------
Total benefits and expenses                                            249.5               215.3              238.2
                                                            -----------------  ------------------  -----------------

Income before income taxes and cumulative effect
    of change in accounting principle                                   47.4                80.2               50.4
Income tax expense                                                      16.6                26.3               17.8
                                                            -----------------  ------------------  -----------------
Income before cumulative effect of change
    in accounting principles                                            30.8                53.9               32.6
Cumulative effect of change in accounting principles,
    net of tax                                                           0.8                   -             (865.0)
                                                            -----------------  ------------------  -----------------
Net income (loss)                                                     $ 31.6              $ 53.9           $ (832.4)
                                                            =================  ==================  =================

</TABLE>

   The accompanying notes are an integral part of these financial statements.

                                       41

<PAGE>


                  ReliaStar Life Insurance Company of New York
         (A wholly-owned subsidiary of ReliaStar Life Insurance Company)

                                 Balance Sheets
                        (In millions, except share data)


<TABLE>
<S>                                                                                 <C>              <C>

                                                                                          As of December 31,
                                                                                         2004             2003
                                                                                    ---------------  ---------------
Assets
Investments:
    Fixed maturities, available-for-sale, at fair value
      (amortized cost of $1,553.2 at 2004 and $1,538.4 at 2003)                      $     1,613.1    $     1,614.2
    Equity securities, available-for-sale, at fair value (cost of
      $6.9 at 2004 and 2003)                                                                   7.6              6.7
    Mortgage loans on real estate                                                            213.0            209.7
    Policy loans                                                                              90.9             86.6
    Other investments                                                                         17.0             13.0
    Securities pledged (amortized cost of $149.7 at 2004 and $106.2 at 2003)                 148.5            105.6
                                                                                    ---------------  ---------------
Total investments                                                                          2,090.1          2,035.8
Cash and cash equivalents                                                                     33.5             10.5
Short-term investments under securities loan agreement                                        49.0              1.9
Accrued investment income                                                                     19.2             18.9
Reinsurance recoverable                                                                       84.2             65.1
Deferred policy acquisition costs                                                             77.4             74.6
Value of business acquired                                                                    34.0             36.5
Due from affiliates                                                                            1.4             26.8
Deferred income taxes                                                                         32.5             20.2
Other assets                                                                                  13.2             20.0
Assets held in separate accounts                                                             537.7            513.8
                                                                                    ---------------  ---------------
Total assets                                                                         $     2,972.2    $     2,824.1
                                                                                    ===============  ===============

</TABLE>

   The accompanying notes are an integral part of these financial statements.

                                       42

<PAGE>


                  ReliaStar Life Insurance Company of New York
         (A wholly-owned subsidiary of ReliaStar Life Insurance Company)

                                 Balance Sheets
                        (In millions, except share data)


<TABLE>
<S>                                                                                 <C>              <C>

                                                                                          As of December 31,
                                                                                         2004             2003
                                                                                    ---------------  ---------------
Liabilities and Shareholder's Equity
Policy liabilities and accruals                                                          $ 1,772.5        $ 1,677.2
Due to affiliates                                                                              5.1             13.7
Borrowed money                                                                               100.4            101.5
Payables under securities loan agreement                                                      49.0              1.9
Current income taxes                                                                          16.2              3.7
Other liabilities                                                                             39.7             57.7
Liabilities related to separate accounts                                                     537.7            513.8
                                                                                    ---------------  ---------------
Total liabilities                                                                          2,520.6          2,369.5
                                                                                    ---------------  ---------------
Shareholder's equity:
    Common stock (1,377,863 shares authorized, issued and outstanding,
      $2.00 per share value)                                                                   2.8              2.8
    Additional paid-in capital                                                             1,172.7          1,200.1
    Accumulated other comprehensive income                                                    29.6             35.8
    Retained earnings (deficit)                                                             (753.5)          (784.1)
                                                                                    ---------------  ---------------
Total shareholder's equity                                                                   451.6            454.6
                                                                                    ---------------  ---------------
Total liabilities and shareholder's equity                                               $ 2,972.2        $ 2,824.1
                                                                                    ===============  ===============
</TABLE>

   The accompanying notes are an integral part of these financial statements.

                                       43

<PAGE>


                  ReliaStar Life Insurance Company of New York
         (A wholly-owned subsidiary of ReliaStar Life Insurance Company)

                  Statements of Changes in Shareholder's Equity
                                  (In millions)


<TABLE>
<S>                                    <C>           <C>           <C>                <C>            <C>

                                                                      Accumulated
                                                      Additional         Other          Retained          Total
                                          Common       Paid-In       Comprehensive      Earnings      Shareholder's
                                          Stock        Capital          Income          (Deficit)        Equity
                                       ------------- ------------- ------------------ -------------- ----------------
Balance at December 31, 2001             $      2.8    $  1,194.6     $      6.5       $    8.8        $ 1,212.7
Capital contribution                              -          31.4              -              -             31.4
Dividends to Shareholder                          -             -              -          (14.4)           (14.4)
Comprehensive income:
    Net loss                                      -             -              -         (832.4)          (832.4)
    Other comprehensive income,
      net of tax:
      Unrealized gain on securities
        ($45.0 pretax)                            -             -           28.9              -             28.9
                                                                                                     ----------------
Comprehensive loss                                                                                        (803.5)
                                                                                                     ----------------
Other                                             -          (0.4)             -              -             (0.4)
                                       ------------- ------------- ------------------ -------------- ----------------
Balance at December 31, 2002                    2.8       1,225.6           35.4         (838.0)           425.8
Dividends to Shareholder                          -         (25.5)             -              -            (25.5)
Comprehensive income:
    Net income                                    -             -              -           53.9             53.9
    Other comprehensive income,
      net of tax:
      Unrealized gain on securities
        ($0.8 pretax)                             -             -            0.4              -              0.4
                                                                                                     ----------------
Comprehensive income                                                                                        54.3
                                       ------------- ------------- ------------------ -------------- ----------------
Balance at December 31, 2003                    2.8       1,200.1           35.8         (784.1)           454.6
Dividends to Shareholder                                    (27.2)                                         (27.2)
Comprehensive income:
    Net income                                                                             31.6             31.6
    Other comprehensive income,
      net of tax:
      Unrealized loss on securities
        ($(11.7) pretax)                                                    (7.4)                           (7.4)
                                                                                                     ----------------
Comprehensive income                                                                                        24.2
                                                                                                     ----------------
Other                                                        (0.2)           1.2           (1.0)               -
                                       ------------- ------------- ------------------ -------------- ----------------
Balance at December 31, 2004             $      2.8    $  1,172.7     $     29.6       $ (753.5)       $   451.6
                                       ============= ============= ================== ============== ================

</TABLE>

   The accompanying notes are an integral part of these financial statements.

                                       44

<PAGE>

                  ReliaStar Life Insurance Company of New York
         (A wholly-owned subsidiary of ReliaStar Life Insurance Company)

                            Statements of Cash Flows
                                  (In millions)


<TABLE>
<S>                                                                 <C>              <C>              <C>

                                                                                Year ended December 31,
                                                                        2004              2003             2002
                                                                                        Restated         Restated
                                                                    --------------   --------------   --------------
Cash Flows from Operating Activities:
Net income (loss)                                                          $ 31.6           $ 53.9         $ (832.4)
Adjustments to reconcile net income (loss) to net cash
    provided by operating activities:
    Capitalization of deferred policy acquisition costs and
      value of business acquired                                            (18.5)           (26.9)           (32.7)
    Amortization of deferred policy acquisition costs and
      value of business acquired                                             19.6             29.5             29.7
    Future policy benefits, claims reserves, and interest credited           58.6              7.0             22.1
    Net realized capital (gains) losses                                      (9.4)           (10.4)             5.6
    Impairment of goodwill                                                      -                -            865.0
    Change in:
      Reinsurance recoverable                                               (19.1)           (18.6)            (1.5)
      Accounts receivable                                                     8.1             (6.7)             4.5
      Accounts payable                                                       (7.8)           (22.5)            (4.0)
      Due from affiliates                                                    16.8             (6.2)            40.2
    Other                                                                    (7.0)             6.8              1.2
                                                                    --------------   --------------   --------------
Net cash provided by operating activities                                    72.9              5.9             97.7
                                                                    --------------   --------------   --------------
Cash Flows from Investing Activities:
    Proceeds from the sale, maturity or redemption of:
      Fixed maturities, available-for-sale                                2,488.1          2,767.9          2,238.6
      Mortgage loans on real estate                                          24.5             44.3             29.7
    Acquisition of:
      Fixed maturities, available-for-sale                               (2,531.1)        (2,879.3)        (2,284.4)
      Mortgage loans on real estate                                         (27.3)           (10.0)            (7.5)
    Short-term investments, net                                               0.1              0.9             (1.0)
    Other, net                                                               (8.4)            (2.4)            (4.6)
                                                                    --------------   --------------   --------------
Net cash used for investing activities                                      (54.1)           (78.6)           (29.2)
                                                                    --------------   --------------   --------------

</TABLE>


   The accompanying notes are an integral part of these financial statements.

                                       45

<PAGE>

                  ReliaStar Life Insurance Company of New York
         (A wholly-owned subsidiary of ReliaStar Life Insurance Company)

                            Statements of Cash Flows
                                  (In millions)


<TABLE>
<S>                                                                 <C>              <C>              <C>

                                                                                Year ended December 31,
                                                                        2004              2003             2002
                                                                                        Restated         Restated
                                                                    --------------   --------------   --------------
Cash Flows from Financing Activities:
    Deposits received for investment contracts                        $     193.2      $     175.5      $     183.5
    Maturities and withdrawals from investment contracts                   (163.1)          (151.1)          (173.0)
    Short-term borrowings, net                                                1.2             28.3             (2.3)
    Dividends to shareholder                                                (27.2)           (25.5)           (14.4)
    Other                                                                     0.1                -              5.8
                                                                    --------------   --------------   --------------
Net cash provided by financing activities                                     4.2             27.2             (0.4)
                                                                    --------------   --------------   --------------
Net increase (decrease) in cash and cash equivalents                         23.0            (45.5)            68.1
Cash and cash equivalents, beginning of year                                 10.5             56.0            (12.1)
                                                                    --------------   --------------   --------------
Cash and cash equivalents, end of year                                $      33.5      $      10.5      $      56.0
                                                                    ==============   ==============   ==============
Supplemental cash flow information:
    Income taxes paid, net                                            $       9.5      $      29.5      $       2.7
                                                                    ==============   ==============   ==============
    Interest paid                                                     $       1.5      $       1.9      $       1.7
                                                                    ==============   ==============   ==============
</TABLE>


   The accompanying notes are an integral part of these financial statements.

                                       46

<PAGE>

ReliaStar Life Insurance Company of New York
(A wholly-owned subsidiary of ReliaStar Life Insurance Company)
Notes to Financial Statements
(Dollar amounts in millions, unless otherwise stated)
--------------------------------------------------------------------------------

1.   Organization and Significant Accounting Policies

     Basis of Presentation

     ReliaStar Life Insurance  Company of New York ("RLNY" or the "Company"),  a
     direct,   wholly-owned  subsidiary  of  ReliaStar  Life  Insurance  Company
     ("ReliaStar  Life"),  is a stock life insurance company organized under the
     laws of the State of New York. ReliaStar Life is a wholly-owned  subsidiary
     of Lion  Connecticut  Holdings Inc.  ("Lion"),  a  Connecticut  holding and
     management  company.  Lion is an indirect,  wholly-owned  subsidiary of ING
     Groep N.V.  ("ING"),  a global financial  services holding company based in
     The  Netherlands,  with American  Depository  Shares listed on the New York
     Stock Exchange under the symbol "ING."

     Until  October  1, 2003,  the  Company  was a  wholly-owned  subsidiary  of
     Security-Connecticut Life Insurance Company  ("Security-Connecticut Life"),
     a Minnesota domiciled insurance company,  which provided financial products
     and   services   in  the  United   States.   Effective   October  1,  2003,
     Security-Connecticut merged with and into ReliaStar Life.

     On April 1, 2002,  ReliaStar  Life  acquired  First  Golden  American  Life
     Insurance Company of New York ("First Golden"), an affiliated entity, for a
     purchase price of $27.7 in cash and $0.2 in receivables. The purchase price
     was based on First  Golden's  statutory-basis  book value.  ReliaStar  Life
     contributed  First  Golden  to   Security-Connecticut  at  book  value  per
     generally  accepted  accounting  principles in the Untied States  ("GAAP").
     Security-Connecticut contributed First Golden to RLNY, and First Golden was
     dissolved into RLNY at GAAP book value. The contribution of First Golden to
     RLNY was  recorded as an increase  to  stockholder's  equity of $31.4 which
     equaled  First  Golden's  April 1, 2002 GAAP book value.  Approval  for the
     merger was obtained  from the  insurance  departments  of the states of New
     York and Delaware.

     Statement  of Financial  Accounting  Standards  ("FAS") No. 141,  "Business
     Combinations",  excludes  transfers  of net assets or  exchanges  of shares
     between  entities under common control,  and notes that certain  provisions
     under  Accounting  Principles  Board  ("APB")  Opinion  No.  16,  "Business
     Combinations",  provide  a source of  guidance  for such  transactions.  In
     accordance with APB Opinion No. 16,  financial  information of the combined
     entity is presented as if the entities had been combined for the full year,
     and all comparative  financial  statements are restated and presented as if
     the  entities  had  previously  been  combined,  in a manner  similar  to a
     pooling-of-interests.  The balance sheets and statements of operations give
     effect to the consolidation transactions as if they had occurred on January
     1, 2002.

     The financial  statements  and notes have been prepared in accordance  with
     generally accepted accounting principles in the United States.


                                       47

<PAGE>

ReliaStar Life Insurance Company of New York
(A wholly-owned subsidiary of ReliaStar Life Insurance Company)
Notes to Financial Statements
(Dollar amounts in millions, unless otherwise stated)
--------------------------------------------------------------------------------

     Description of Business

     The  Company is  principally  engaged in the  business  of  providing  life
     insurance and related financial services products. The Company provides and
     distributes  individual  life  insurance and  annuities;  employee  benefit
     products and services; and retirement plans. The Company operates primarily
     in the United States and is authorized to conduct business in all 50 states
     and the District of Columbia.

     Recently Adopted Accounting Standards

     Accounting   and   Reporting   by   Insurance   Enterprises   for   Certain
     Nontraditional Long-Duration Contracts and for Separate Accounts

     The Company  adopted  Statement of Position  ("SOP") 03-1,  "Accounting and
     Reporting by Insurance Enterprises for Certain Nontraditional Long-Duration
     Contracts  and for  Separate  Accounts,"  on  January  1,  2004.  SOP  03-1
     established several new accounting and disclosure  requirements for certain
     nontraditional long-duration contracts and for separate accounts including,
     among other things,  a requirement  that assets and liabilities of separate
     account  arrangements that do not meet certain criteria be accounted for as
     general  account  assets and  liabilities,  and the  revenues  and expenses
     related to such arrangements be consolidated with the respective line items
     in the Statements of Operations.  In addition,  the SOP requires additional
     liabilities be established  for certain  guaranteed  death benefits and for
     products  with  certain  patterns  of  cost  of  insurance  charges.  Sales
     inducements  provided  to  contractowners  and  policyholders  must also be
     recognized on the balance sheet separately from deferred  acquisition costs
     and  amortized as a component of benefits  expense  using  methodology  and
     assumptions  consistent with those used for amortization of deferred policy
     acquisition costs.

     The Company  evaluated all  requirements of SOP 03-1 and determined that it
     is affected  by the SOP's  requirements  to account  for  certain  separate
     account  arrangements  as  general  account   arrangements,   to  establish
     additional  liabilities  for certain  guaranteed  benefits and for products
     with patterns of cost of insurance charges that result in gains followed by
     losses in later policy durations from the insurance benefit  function,  and
     to  defer  and   amortize   sales   inducements   to   contractowners   and
     policyholders.  Upon  adoption  of the SOP on January 1, 2004,  the Company
     recognized  a  cumulative  effect of a change in  accounting  principle  of
     $(10.8),  before tax or $(7.0),  net of $3.8 of income taxes.  In addition,
     requirements for certain separate account arrangements that do not meet the
     established  criteria  for separate  asset and  liability  recognition  are
     applicable  to the Company,  however,  the  Company's  policies on separate
     account assets and liabilities have historically  been, and continue to be,
     in conformity with the requirements newly established.

     In the  fourth  quarter  of 2004,  the  cumulative  effect  of a change  in
     accounting  principle  was revised due to the  implementation  of Technical


                                       48

<PAGE>

ReliaStar Life Insurance Company of New York
(A wholly-owned subsidiary of ReliaStar Life Insurance Company)
Notes to Financial Statements
(Dollar amounts in millions, unless otherwise stated)
--------------------------------------------------------------------------------

     Practice Aid 6300.05 - 6300.08,  "Q&As Related to the Implementation of SOP
     03-1,  "Accounting  and  Reporting  by Insurance  Enterprises,  for Certain
     Nontraditional  Long-Duration  Contracts and for Separate  Accounting" (the
     "TPA").

     The TPA, which was approved in September 2004, provides additional guidance
     regarding  certain implicit  assessments that may be used in testing of the
     base  mortality  function on  contracts,  which is  performed  to determine
     whether  additional  liabilities are required in conjunction with SOP 03-1.
     In addition,  the TPA provides additional guidance  surrounding the allowed
     level of aggregation of additional  liabilities  determined  under the SOP.
     While the TPA was  implemented  during the fourth  quarter of 2004, the TPA
     was retroactive to the original implementation date of SOP 03-1, January 1,
     2004 and was reported as an  adjustment to the SOP 03-1  cumulative  effect
     change in  accounting  principle.  The  adoption of the TPA  resulted in an
     adjustment  of  the  Company's   cumulative  effect  change  in  accounting
     principle by $7.8, net of $4.2 of income tax.

     The   implementation   of  SOP  03-1   raised   questions   regarding   the
     interpretation  of the requirements of FAS No. 97 "Accounting and Reporting
     by  Insurance  Enterprises  for  Certain  Long-Duration  Contracts  and for
     Realized Gains and Losses from the Sale of Investments," concerning when it
     is  appropriate  to record an  unearned  revenue  liability  related to the
     insurance  benefit  function.  To  clarify  its  position,   the  Financial
     Accounting Standards Board ("FASB") issued FASB Staff Position No. FAS 97-1
     ("FSP FAS  97-1"),  "Situations  in Which  Paragraphs  17(b) and 20 of FASB
     Statement No. 97,  `Accounting  and Reporting by Insurance  Enterprises for
     Certain Long-Duration  Contracts and for Realized Gains and Losses from the
     Sale of  Investments,'  Permit or Require  Accrual of an  Unearned  Revenue
     Liability,"  effective for fiscal periods beginning  subsequent to the date
     the guidance was issued, June 18, 2004. The Company adopted FSP FAS 97-1 on
     July 1, 2004.  The  adoption  of FSP FAS 97-1 did not have an impact on the
     Company's financial position, results of operations or cash flows.

     The  Meaning of  Other-than-temporary  Impairment  and its  Application  to
     Certain Investments

     In March 2004, the Emerging Issues Task Force ("EITF")  reached a consensus
     on EITF Issue No. 03-1 ("EITF 03-1"), "The Meaning of  Other-Than-Temporary
     Impairment and Its  Application to Certain  Investments,"  requiring that a
     three-step  impairment model be applied to securities within its scope. The
     three-step  model  is to be  applied  on a  security-by-security  basis  as
     follows:

     Step 1:  Determine  whether an  investment  is impaired.  An
              investment is impaired  if the fair  value of the
              investment  is less than its cost basis.
     Step 2:  Evaluate whether an impairment is other-than-temporary.
     Step 3:  If the impairment is other-than-temporary,  recognize an
              impairment loss equal to the  difference  between the
              investment's  cost and its fair value.


                                       49

<PAGE>

ReliaStar Life Insurance Company of New York
(A wholly-owned subsidiary of ReliaStar Life Insurance Company)
Notes to Financial Statements
(Dollar amounts in millions, unless otherwise stated)
--------------------------------------------------------------------------------

     On September 30, 2004,  the FASB issued FASB Staff  Position No. EITF Issue
     03-1-1 ("FSP EITF  03-1-1"),  "Effective  Date of Paragraphs  10-20 of EITF
     Issue No. 03-1,  "The Meaning of  Other-Than-Temporary  Impairment  and Its
     Application to Certain  Investments," which delayed the EITF Issue No. 03-1
     original  effective  date of July 1,  2004 for  steps  two and three of the
     impairment model introduced. The delay is in effect until a final consensus
     can be reached on such guidance. Despite the delay of the implementation of
     steps  two and  three,  other-than-temporary  impairments  are  still to be
     recognized as required by existing guidance.

     Earlier  consensus  reached by the EITF on this issue required that certain
     quantitative and qualitative  disclosures be made for unrealized  losses on
     debt  and   equity   securities   that   have  not   been   recognized   as
     other-than-temporary  impairments.  These  disclosures  were adopted by the
     Company,  effective  December 31, 2003, and are included in the Investments
     footnote.

     Accounting for Derivative Instruments and Hedging Activities

     In 2003, the Derivative  Implementation  Group ("DIG") who was  responsible
     for issuing  guidance on behalf of the FASB for  implementation  of FAS No.
     133, "Accounting for Derivative Instruments and Hedging Activities," issued
     Implementation Issue No. B36, "Embedded  Derivatives:  Modified Coinsurance
     Arrangements and Debt  Instruments  That Incorporate  Credit Risk Exposures
     That Are Unrelated or Only  Partially  Related to the Credit  Worthiness of
     the   Obligor   Under   Those   Instruments"   ("DIG   B36").   Under  this
     interpretation,  modified  coinsurance and coinsurance  with funds withheld
     reinsurance agreements,  as well as other types of receivables and payables
     where  interest is  determined  by  reference  to a pool of fixed  maturity
     assets or a total return debt index,  may be determined to contain embedded
     derivatives that are required to be bifurcated. The Company adopted DIG B36
     on  October  1,  2003,  and the  adoption  had no impact  on the  Company's
     financial position, results of operations or cash flows.

     Variable Interest Entities

     In January 2003, the FASB issued FASB Interpretation 46,  "Consolidation of
     Variable Interest Entities, an Interpretation of ARB No. 51" ("FIN 46"). In
     December  2003,  the  FASB  modified  FIN  46  to  make  certain  technical
     corrections and address certain  implementation issues that had arisen. FIN
     46 provides a new  framework for  identifying  Variable  Interest  Entities
     ("VIEs")  and  determining  when  a  company  should  include  the  assets,
     liabilities, noncontrolling interests and results of activities of a VIE in
     its consolidated financial statements.

     In  general,  a  VIE  is  a  corporation,  partnership,   limited-liability
     corporation, trust, or any other legal structure used to conduct activities
     or hold  assets  that  either (1) has an  insufficient  amount of equity to
     carry  out  its  principal   activities  without  additional   subordinated
     financial support, (2) has a group of equity owners that are unable to make


                                       50

<PAGE>

ReliaStar Life Insurance Company of New York
(A wholly-owned subsidiary of ReliaStar Life Insurance Company)
Notes to Financial Statements
(Dollar amounts in millions, unless otherwise stated)
--------------------------------------------------------------------------------

     significant  decisions about its  activities,  or (3) has a group of equity
     owners  that do not have the  obligation  to absorb  losses or the right to
     receive returns generated by its operations.

     FIN 46  requires a VIE to be  consolidated  if a party  with an  ownership,
     contractual  or other  financial  interest in the VIE (a variable  interest
     holder)  is  obligated  to absorb a  majority  of the risk of loss from the
     VIE's  activities,  is entitled to receive a majority of the VIE's residual
     returns (if no party  absorbs a majority of the VIE's  losses),  or both. A
     variable  interest holder that  consolidates  the VIE is called the primary
     beneficiary.  Upon consolidation,  the primary  beneficiary  generally must
     initially  record all of the VIE's assets,  liabilities and  noncontrolling
     interests at fair value and subsequently  account for the VIE as if it were
     consolidated  based  on  majority  voting  interest.  FIN 46 also  requires
     disclosures about VIEs that the variable interest holder is not required to
     consolidate but in which it has a significant variable interest.

     The  Company  holds  investments  in VIEs in the form of private  placement
     securities, structured securities, securitization transactions, and limited
     partnerships  with an  aggregate  fair value of $643.6 as of  December  31,
     2004.  These  VIEs  are  held  by  the  Company  for  investment  purposes.
     Consolidation of these investments in the Company's financial statements is
     not required as the Company is not the primary beneficiary for any of these
     VIEs. Book value as of December 31, 2004, of $628.8  represents the maximum
     exposure to loss  except for those  structures  for which the Company  also
     receives asset management fees.

     Goodwill Impairment

     During  2002,  the  Company  adopted  FAS  No.  142,  "Goodwill  and  Other
     Intangible  Assets" ("FAS No. 142"). The adoption of this standard resulted
     in an impairment  loss of $865.0,  net of $465.8 of income tax,  related to
     prior  acquisitions,  recorded  retroactive  to the first  quarter of 2002;
     prior  quarters of 2002 were restated  accordingly.  This  impairment  loss
     represented  the entire  carrying  amount of goodwill,  net of  accumulated
     amortization.  This  impairment  charge was shown as a change in accounting
     principle on the 2002 Statement of Operations.

     Guarantees

     In  November  2002,  the FASB  issued  Interpretation  No.  45 ("FIN  45"),
     "Guarantor's   Accounting  and  Disclosure   Requirements  for  Guarantees,
     Including  Indirect  Guarantees  of  Indebtedness  of  Others,"  to clarify
     accounting and disclosure  requirements  relating to a guarantor's issuance
     of certain  types of  guarantees.  FIN 45  requires  entities  to  disclose
     additional  information  about  certain  guarantees,  or groups of  similar
     guarantees,  even if the likelihood of the  guarantor's  having to make any
     payments  under the  guarantee is remote.  The  disclosure  provisions  are
     effective for financial  statements  for fiscal years ended after  December
     15, 2002. For certain  guarantees,  the  interpretation  also requires that


                                       51

<PAGE>

ReliaStar Life Insurance Company of New York
(A wholly-owned subsidiary of ReliaStar Life Insurance Company)
Notes to Financial Statements
(Dollar amounts in millions, unless otherwise stated)
--------------------------------------------------------------------------------

     guarantors  recognize a liability  equal to the fair value of the guarantee
     upon its issuance.  This initial recognition and measurement provisions are
     to be applied only on a prospective  basis to guarantees issued or modified
     after  December 31, 2002.  The Company has  performed an  assessment of its
     guarantees and believes that all of its significant guarantees are excluded
     from the scope of this interpretation.

     New Accounting Pronouncements

     In December 2004, the FASB issued FAS No. 123 (revised 2004),  "Share-Based
     Payment",   which  requires  all  share-based   payments  to  employees  be
     recognized in the financial  statements based upon the fair value. FAS 123R
     is  effective  at the  beginning  of the first  interim  or  annual  period
     beginning  after June 15, 2005.  Earlier  adoption is encouraged.  FAS 123R
     provides    two    transition     methods,     modified-prospective     and
     modified-retrospective.

     The  modified-prospective  method  recognizes the grant-date  fair value of
     compensation  for new awards  granted after the effective date and unvested
     awards  beginning in the fiscal period in which the recognition  provisions
     are   first    applied.    Prior    periods   are   not    restated.    The
     modified-retrospective  method permits entities to restate prior periods by
     recognizing the compensation cost based on the amount  previously  reported
     in the pro forma  footnote  disclosures  as  required  under  FAS No.  123,
     "Accounting for Stock-Based Compensation".

     The Company intends to early adopt the provisions of FAS 123R on January 1,
     2005,  using the  modified-prospective  method.  Due to the  Company's  few
     number of  employees,  the  adoption of FAS 123R is not  expected to have a
     material impact on the Company's financial position, results of operations,
     or cash flows.  Prior to January  2005,  the Company  applied the intrinsic
     value-based  provisions  set forth in APB Opinion No. 25,  "Accounting  for
     Stock Issued to Employees".  Under the intrinsic value method, compensation
     expense is determined on the measurement  date,  which is the first date on
     which both the number of shares the employee is entitled to receive and the
     exercise price are known.  Compensation  expense, if any, is measured based
     on the award's intrinsic value,  which is the excess of the market price of
     the stock over the exercise price on the measurement date.

     Use of Estimates

     The  preparation  of financial  statements  in conformity  with  accounting
     principles  generally accepted in the United States requires  management to
     make  estimates  and  assumptions  that affect the amounts  reported in the
     financial  statements and accompanying  notes.  Actual results could differ
     from reported results using those estimates.


                                       52

<PAGE>

ReliaStar Life Insurance Company of New York
(A wholly-owned subsidiary of ReliaStar Life Insurance Company)
Notes to Financial Statements
(Dollar amounts in millions, unless otherwise stated)
--------------------------------------------------------------------------------

     Reclassifications

     Certain   reclassifications   have  been  made  to  prior  year   financial
     information  to conform to the current year  classifications  (see footnote
     15).

     Cash and Cash Equivalents

     Cash and cash equivalents  include cash on hand,  money market  instruments
     and other debt issues with a maturity of 90 days or less when purchased.

     Investments

     All of the Company's  fixed  maturity and equity  securities  are currently
     designated  as   available-for-sale.   Available-for-sale   securities  are
     reported at fair value and unrealized  gains and losses on these securities
     are included directly in shareholder's equity, after adjustment for related
     changes in deferred  acquisition costs ("DAC"),  value of business acquired
     ("VOBA") and deferred income taxes.

     Other-Than-Temporary Impairments

     The Company analyzes the general account  investments to determine  whether
     there has been an  other-than-temporary  decline  in fair  value  below the
     amortized cost basis.  Management  considers the length of the time and the
     extent to which the fair  value has been  less  than  cost;  the  financial
     condition and near-term prospects of the issuer; future economic conditions
     and market  forecasts;  and the Company's  intent and ability to retain the
     investment  in the  issuer  for a period  of time  sufficient  to allow for
     recovery in fair value. If it is probable that all amounts due according to
     the  contractual  terms  of a  debt  security  will  not be  collected,  an
     other-than-temporary impairment is considered to have occurred.

     In addition,  the Company  invests in structured  securities  that meet the
     criteria  of EITF Issue No.  99-20,  "Recognition  of  Interest  Income and
     Impairment on Purchased and Retained  Beneficial  Interests in  Securitized
     Financial  Assets."  Under EITF Issue No.  99-20,  a  determination  of the
     required  impairment  is  based  on  credit  risk  and the  possibility  of
     significant prepayment risk that restricts the Company's ability to recover
     the  investment.  An  impairment  is  recognized  if the fair  value of the
     security  is less than book value and there has been an  adverse  change in
     cash flow since the last remeasurement date.

     When a decline in fair value is determined to be other-than-temporary,  the
     individual  security is written  down to fair value and the loss  accounted
     for as a realized loss.


                                       53

<PAGE>

ReliaStar Life Insurance Company of New York
(A wholly-owned subsidiary of ReliaStar Life Insurance Company)
Notes to Financial Statements
(Dollar amounts in millions, unless otherwise stated)
--------------------------------------------------------------------------------

     Purchases and Sales

     Purchases and sales of fixed  maturities and equity  securities  (excluding
     private placements) are recorded on the trade date.  Purchases and sales of
     private placements and mortgage loans are recorded on the closing date.

     Valuation

     Fair values for fixed  maturities  are obtained  from  independent  pricing
     services or  broker-dealer  quotations.  Fair values for  privately  placed
     bonds are determined using a matrix-based  model.  The  matrix-based  model
     considers the level of risk-free interest rates, current corporate spreads,
     the credit  quality of the  issuer,  and cash flow  characteristics  of the
     security.  The fair values for equity securities are based on quoted market
     prices.  For equity  securities not actively traded,  estimated fair values
     are  based  upon  values  of issues of  comparable  yield  and  quality  or
     conversion value, where applicable.

     Mortgage  loans  on  real  estate  are  reported  at  amortized  cost  less
     impairment  writedowns.  If the value of any mortgage loan is determined to
     be impaired  (i.e.,  when it is probable that the Company will be unable to
     collect all  amounts due  according  to the  contractual  terms of the loan
     agreement),  the carrying  value of the mortgage  loan is reduced to either
     the present value of expected cash flows from the loan  (discounted  at the
     loan's  effective  interest rate), or fair value of the collateral.  If the
     loan is in foreclosure,  the carrying value is reduced to the fair value of
     the underlying  collateral,  net of estimated costs to obtain and sell. The
     carrying value of the impaired loans is reduced by establishing a permanent
     writedown charged to realized loss.

     Policy loans are carried at unpaid principal balances.

     Short-term  investments,  consisting  primarily of money market instruments
     and other fixed maturity issues  purchased with an original  maturity of 91
     days to one year, are considered available-for-sale and are carried at fair
     value, which approximates amortized cost.

     Securities Lending

     The Company engages in securities  lending whereby certain  securities from
     its portfolio are loaned to other  institutions  for short periods of time.
     Initial  collateral,  primarily  cash, is required at a rate of 102% of the
     market value of the loaned domestic securities. The collateral is deposited
     by the  borrower  with a lending  agent and  retained  and  invested by the
     lending agent according to the Company's  guidelines to generate additional
     income.  The market value of the loaned  securities is monitored on a daily
     basis with additional  collateral obtained or refunded as the fair value of
     the loaned securities fluctuates.


                                       54

<PAGE>

ReliaStar Life Insurance Company of New York
(A wholly-owned subsidiary of ReliaStar Life Insurance Company)
Notes to Financial Statements
(Dollar amounts in millions, unless otherwise stated)
--------------------------------------------------------------------------------

     Repurchase Agreements

     The Company engages in dollar  repurchase  agreements  ("dollar rolls") and
     repurchase agreements.  These transactions involve a sale of securities and
     an agreement to repurchase substantially the same securities as those sold.
     Company  policies  require a minimum of 95% of the fair value of securities
     pledged  under dollar rolls and  repurchase  agreement  transactions  to be
     maintained as  collateral.  Cash  collateral  received is invested in fixed
     maturities, and the offsetting collateral liability is included in borrowed
     money on the Balance Sheets.

     The  Company  also  enters  into  reverse  repurchase   agreements.   These
     transactions  involve a purchase of  securities  and an  agreement  to sell
     substantially  the same  securities as those  purchased.  Company  policies
     require a minimum of 102% of the fair  value of  securities  pledged  under
     reverse  repurchase  agreements  to  be  pledged  as  collateral.   Reverse
     repurchase  agreements  are  included  in cash  equivalents  on the Balance
     Sheets.

     Derivatives

     The Company's use of derivatives is limited  primarily to hedging purposes.
     However,  these  derivatives  are not accounted for using hedge  accounting
     treatment  under FAS No. 133 as the Company does not seek hedge  accounting
     treatment.  The Company enters into interest rate, and currency  contracts,
     including swaps,  caps, floors,  options and futures,  to reduce and manage
     risks associated with changes in value, yield, price, cash flow or exchange
     rates of assets or liabilities held or intended to be held.  Changes in the
     fair  value of open  derivative  contracts  are  recorded  in net  realized
     capital gains and losses.  Derivatives are included in other investments on
     the Balance Sheets.

     Deferred Policy Acquisition Costs and Value of Business Acquired

     DAC represent policy  acquisition  costs that have been capitalized and are
     subject  to  amortization.   Such  costs  consist  principally  of  certain
     commissions,  underwriting, contract issuance, and agency expenses, related
     to the production of new and renewal business.

     VOBA represents the outstanding value of in force business  capitalized and
     is subject to  amortization  in  purchase  accounting  when the Company was
     acquired.  The value is based on the present  value of  estimated  net cash
     flows embedded in the Company's contracts.

     The amortization  methodology used for DAC and VOBA varies by product type.
     Statement of Financial Accounting Standards ("FAS") No. 60, "Accounting and
     Reporting by Insurance  Enterprises," applies to traditional life insurance
     products,   primarily  traditional  whole  life  and  term  life  insurance
     contracts.  Under FAS No. 60, DAC and VOBA are  amortized  over the premium
     payment period, in proportion to the premium revenue recognized.


                                       55

<PAGE>

ReliaStar Life Insurance Company of New York
(A wholly-owned subsidiary of ReliaStar Life Insurance Company)
Notes to Financial Statements
(Dollar amounts in millions, unless otherwise stated)
--------------------------------------------------------------------------------

     FAS No. 97 applies to universal life and investment-type  products, such as
     fixed and variable deferred  annuities.  Under FAS No. 97, DAC and VOBA are
     amortized,  with interest,  over the life of the related contracts (usually
     25 years) in  relation  to the  present  value of  estimated  future  gross
     profits from investment,  mortality, and expense margins; asset-based fees,
     policy administration,  and surrender charges; less policy maintenance fees
     and  non-capitalized  commissions,  as well as realized gains and losses on
     investments.

     Changes  in  assumptions  can  have a  significant  impact  on DAC and VOBA
     balances  and  amortization  rates.   Several  assumptions  are  considered
     significant  in the  estimation  of future gross  profits  associated  with
     variable universal life and variable deterred annuity products.  One of the
     most  significant  assumptions  involved in the  estimation of future gross
     profits  is  the  assumed  return  associated  with  the  variable  account
     performance.  To  reflect  the  volatility  in  the  equity  markets,  this
     assumption  involves a combination of near-term  expectations and long-term
     assumptions  regarding  market  performance.  The  overall  return  on  the
     variable account is dependent on multiple  factors,  including the relative
     mix of the underlying  sub-accounts  among bond funds and equity funds,  as
     well as equity sector  weightings.  Other significant  assumptions  include
     surrender  and  lapse  rates,  estimated  interest  spread,  and  estimated
     mortality.

     Due to the relative  size and  sensitivity  to minor  changes in underlying
     assumptions of DAC and VOBA balances,  the Company performs a quarterly and
     annual  analysis  of DAC and VOBA  for the  annuity  and  life  businesses,
     respectively.  The DAC and VOBA balances are  evaluated for  recoverability
     and are  reduced to the extent  that  estimated  future  gross  profits are
     inadequate to recover the asset.

     At each evaluation date, actual historical gross profits are reflected, and
     estimated  future gross profits and related  assumptions  are evaluated for
     continued reasonableness.  Any adjustment in estimated profit requires that
     the amortization rate be revised ("unlocking") retroactively to the date of
     the policy or contract issuance.  The cumulative prior period adjustment is
     recognized  as a  component  of current  period  amortization.  In general,
     increases in investment, mortality, and expense margins, and thus estimated
     future  profits,  lower the rate of  amortization.  However,  decreases  in
     investment,  mortality,  and expense  margins,  and thus  estimated  future
     profits, increase the rate of amortization.

     Reserves

     The Company establishes and carries  actuarially  determined reserves which
     are  calculated  to meet its future  obligations.  Reserves are  calculated
     using  mortality  and  withdrawal  rate  assumptions  are based on relevant
     Company  experience  and are  periodically  reviewed  against both industry
     standards and experience.


                                       56

<PAGE>

ReliaStar Life Insurance Company of New York
(A wholly-owned subsidiary of ReliaStar Life Insurance Company)
Notes to Financial Statements
(Dollar amounts in millions, unless otherwise stated)
--------------------------------------------------------------------------------

     Future  policy  benefits  include  reserves for universal  life,  immediate
     annuities with life  contingent  payouts,  and  traditional  life insurance
     contracts.  Reserves for  universal  life  products are equal to cumulative
     deposits less withdrawals and charges plus credited  interest  thereon.  In
     addition,  the Company  holds  reserves as required by SOP 03-1 for certain
     products with anticipated  losses in later policy  durations.  Reserves for
     traditional life insurance  contracts represent the present value of future
     benefits to be paid to or on behalf of  policyholders  and related expenses
     less the present value of future net premiums.

     Reserves for immediate  annuities with life contingent  payout benefits are
     computed on the basis of interest discount rates, mortality,  and expenses,
     including a margin for adverse deviations.  Such assumptions generally vary
     by plan, year of issue and policy  duration.  Reserve  interest rates range
     from 3.95% to 13.19% for all years presented. Changes in or deviations from
     the assumptions used can  significantly  affect the Company's reserve level
     and related future operations.

     Reserves for deferred annuity investment  contracts and immediate annuities
     without life  contingent  benefits are equal to  cumulative  deposits  less
     charges and withdrawals plus credited  interest  thereon (reserve  interest
     rates vary by product up to 7.1% for 2004, 2003 and 2002).

     Sales Inducements

     Sales   inducements   represent   benefits  paid  to   contractowners   and
     policyholders  that are  incremental to the amounts the Company  credits on
     similar  contracts  and are  higher  than the  contracts  expected  ongoing
     crediting  rates for periods after the  inducement.  As of January 1, 2004,
     such amounts are reported  separately  on the Balance  Sheets in accordance
     with  SOP  03-1.  Prior to  2004,  sales  inducements  were  recorded  as a
     component  of  DAC  on  the  Balance  Sheets.   Beginning  in  2004,  sales
     inducements   are  amortized  as  a  component  of  benefit  expense  using
     methodology and assumptions  consistent with those used for amortization of
     DAC. Sales inducements are recorded in other assets on the Balance Sheets.

     Revenue Recognition

     For universal life and certain annuity contracts,  charges assessed against
     contractowners'and   policyholders'   funds  for  the  cost  of  insurance,
     surrender,  expenses and other fees are recorded as revenue.  Other amounts
     received for these contracts are reflected as deposits and are not recorded
     as  revenue.  Related  policy  benefits  are  recorded  in  relation to the
     associated premiums or gross profit so that profits are recognized over the
     expected  lives  of  the  contracts.   When  annuity   payments  with  life
     contingencies   begin  under  contracts  that  were  initially   investment
     contracts,  the  accumulated  balance in the account is treated as a single
     premium  for the  purchase  of an annuity and  reflected  as an  offsetting


                                       57

<PAGE>

ReliaStar Life Insurance Company of New York
(A wholly-owned subsidiary of ReliaStar Life Insurance Company)
Notes to Financial Statements
(Dollar amounts in millions, unless otherwise stated)
--------------------------------------------------------------------------------

     amount in both premiums and current and future  benefits in the  Statements
     of Operations.

     Separate Accounts

     Separate   account  assets  and  liabilities   generally   represent  funds
     maintained to meet specific  investment  objectives of  contractowners  and
     policyholders who bear the investment risk,  subject,  in limited cases, to
     minimum guaranteed rates. Investment income and investment gains and losses
     generally accrue directly to such  contractowners  and  policyholders.  The
     assets of each account are legally segregated and are not subject to claims
     that arise out of any other business of the Company.

     Separate  account assets  supporting  variable options under universal life
     and   annuity    contracts   are    invested,    as   designated   by   the
     contractowner/policyholder  or participant  (who bears the investment  risk
     subject, in limited cases, to minimum guaranteed rates) under a contract in
     shares of mutual funds which are managed by the Company or its  affiliates,
     or in other  selected  mutual  funds  not  managed  by the  Company  or its
     affiliates.

     Separate account assets and liabilities are carried at fair value and shown
     as separate captions in the Balance Sheets.  Deposits,  investment  income,
     and net realized and  unrealized  capital  gains and losses of the Separate
     accounts are not reflected in the Statements of Operations.  The Statements
     of Cash Flows do not reflect investment activity of the separate accounts.

     Assets and liabilities of separate  account  arrangements  that do not meet
     the criteria in SOP 03-1 for separate  presentation  in the Balance  Sheets
     (those  arrangements   supporting  the  guaranteed  interest  option)  were
     reclassified  to the general account on January 1, 2004, in accordance with
     the SOP 03-1 requirements.

     Reinsurance

     The Company utilizes reinsurance agreements to reduce its exposure to large
     losses in all aspects of its insurance  business.  Such reinsurance permits
     recovery  of a portion  of losses  from  reinsurers,  although  it does not
     discharge  the primary  liability  of the Company as direct  insurer of the
     risks reinsured.  The Company evaluates the financial strength of potential
     reinsurers and continually  monitors the financial condition of reinsurers.
     Only those reinsurance recoverable balances deemed probable of recovery are
     reflected as assets on the Company's Balance Sheets.


                                       58

<PAGE>

ReliaStar Life Insurance Company of New York
(A wholly-owned subsidiary of ReliaStar Life Insurance Company)
Notes to Financial Statements
(Dollar amounts in millions, unless otherwise stated)
--------------------------------------------------------------------------------

     Income Taxes

     The  Company is taxed at regular  corporate  rates after  adjusting  income
     reported  for  financial  statement  purposes for certain  items.  Deferred
     income  tax  expenses/benefits  result  from  changes  during  the  year in
     cumulative  temporary  differences  between the tax basis and book basis of
     assets and liabilities.


2.   Investments

     Fixed maturities and equity  securities  available-for-sale  as of December
     31, 2004, were as follows:

     <TABLE>
     <S>                                            <C>               <C>              <C>               <C>

                                                                           Gross            Gross
                                                       Amortized        Unrealized       Unrealized           Fair
                                                         Cost              Gains           Losses             Value
                                                    ----------------  ---------------- ----------------  ----------------
     Fixed maturities:
     U.S. government and government
         agencies and authorities                     $        56.2     $         0.4    $         0.2     $        56.4
     States, municipalities and political
         subdivisions                                           1.6               0.1                -               1.7

     U.S. corporate securities:
         Public utilities                                     154.3               7.9              0.8             161.4
         Other corporate securities                           695.2              35.9              3.0             728.1
                                                    ----------------  ---------------- ----------------  ----------------
           Total U.S. corporate securities                    849.5              43.8              3.8             889.5
                                                    ----------------  ---------------- ----------------  ----------------

     Foreign securities:
         Government                                            28.0               0.6              0.2              28.4
         Other                                                168.0               6.6              1.9             172.7
                                                    ----------------  ---------------- ----------------  ----------------
           Total foreign securities                           196.0               7.2              2.1             201.1
                                                    ----------------  ---------------- ----------------  ----------------

     Residential mortgage-backed securities                   373.5               2.5              2.1             373.9
     Commercial mortgage-backed securities                    119.0               8.2              0.3             126.9
     Other asset-backed securities                            107.1               6.1              1.1             112.1
                                                    ----------------  ---------------- ----------------  ----------------

     Total fixed maturities, including
         fixed maturities pledged                           1,702.9              68.3              9.6           1,761.6
     Less: fixed maturities pledged                           149.7               0.3              1.5             148.5
                                                    ----------------  ---------------- ----------------  ----------------

     Fixed maturities                                       1,553.2              68.0              8.1           1,613.1
     Equity securities                                          6.9               0.7                -               7.6
                                                    ----------------  ---------------- ----------------  ----------------
     Total investments available-for-sale             $     1,560.1     $        68.7    $         8.1     $     1,620.7
                                                    ================  ================ ================  ================

     </TABLE>

                                       59

<PAGE>

ReliaStar Life Insurance Company of New York
(A wholly-owned subsidiary of ReliaStar Life Insurance Company)
Notes to Financial Statements
(Dollar amounts in millions, unless otherwise stated)
--------------------------------------------------------------------------------

     Fixed maturities and equity  securities  available-for-sale  as of December
     31, 2003, were as follows:

     <TABLE>
     <S>                                               <C>            <C>            <C>           <C>

                                                                         Gross          Gross
                                                        Amortized      Unrealized     Unrealized       Fair
                                                           Cost          Gains          Losses        Value
                                                       -------------  -------------  ------------- -------------
     Fixed maturities:
     U.S. government and government
         agencies and authorities                        $      7.4     $      0.3     $        -    $      7.7
     States, municipalities and political
         subdivisions                                           1.8            0.1              -           1.9

     U.S. corporate securities:
         Public utilities                                     127.6            9.3            0.5         136.4
         Other corporate securities                           732.5           48.3            5.9         774.9
                                                       -------------  -------------  ------------- -------------
            Total U.S. corporate securities                   860.1           57.6            6.4         911.3
                                                       -------------  -------------  ------------- -------------

     Foreign securities:
         Government                                            28.0            0.4            0.2          28.2
         Other                                                141.2            6.9            2.8         145.3
                                                       -------------  -------------  ------------- -------------
            Total foreign securities                          169.2            7.3            3.0         173.5
                                                       -------------  -------------  ------------- -------------

     Residential mortgage-backed securities                   399.7            4.0            1.3         402.4
     Commercial mortgage-backed securities                    106.1            9.6            0.3         115.4
     Other asset-backed securities                            100.3            8.6            1.3         107.6
                                                       -------------  -------------  ------------- -------------

     Total fixed maturities, including
         fixed maturities pledged                           1,644.6           87.5           12.3       1,719.8
     Less: Fixed maturities pledged                           106.2            0.5            1.1         105.6
                                                       -------------  -------------  ------------- -------------

     Fixed maturities                                       1,538.4           87.0           11.2       1,614.2
     Equity securities                                          6.9            0.1            0.3           6.7
                                                       -------------  -------------  ------------- -------------
     Total investments available-for-sale                $  1,545.3     $     87.1     $     11.5    $  1,620.9
                                                       =============  =============  ============= =============

     </TABLE>

     At December 31, 2004 and 2003,  net unrealized  appreciation  was $59.4 and
     $75.0, respectively, on total fixed maturities,  including fixed maturities
     pledged to creditors and equity securities.


                                       60

<PAGE>

ReliaStar Life Insurance Company of New York
(A wholly-owned subsidiary of ReliaStar Life Insurance Company)
Notes to Financial Statements
(Dollar amounts in millions, unless otherwise stated)
--------------------------------------------------------------------------------

     The  aggregate  unrealized  losses and  related  fair value of total  fixed
     maturities,  including fixed  maturities  pledged to creditors,  and equity
     securities with unrealized  losses as of December 31, 2004, are shown below
     by duration:

                                                Unrealized             Fair
                                                    Loss               Value
                                             ----------------    ---------------
     Duration category:
         Less than six months below cost       $      2.7          $   335.4
         More than six months and less
           than twelve months below cost              2.5              131.8
         More than twelve months below cost           4.4               78.6
                                             ----------------    ---------------
     Total investments available-for-sale      $      9.6          $   545.8
                                             ================    ===============

     Of the unrealized losses less than 6 months in duration of $2.7, there were
     $1.0 in  unrealized  losses that are  primarily  related to  interest  rate
     movement or spread  widening  for other than  credit-related  reasons.  The
     remaining  losses of $1.7,  as of December 31, 2004,  related to securities
     reviewed for  impairment  under the guidance  proscribed  by EITF Issue No.
     99-20. This category includes U.S. government-backed securities,  principal
     protected  securities,  and  structured  securities,  that  did not have an
     adverse change in cash flows for which the carrying amount was $145.6.

     Of the  unrealized  losses  more  than 6 months  and less than 12 months in
     duration of $2.5,  there were $2.0 in unrealized  losses that are primarily
     related  to  interest  rate  movement  or spread  widening  for other  than
     credit-related  reasons.  The remaining  losses of $0.5, as of December 31,
     2004,  related to  securities  reviewed for  impairment  under the guidance
     proscribed   by  EITF  Issue  No.  99-20.   This  category   includes  U.S.
     government-backed   securities,   principal   protected   securities,   and
     structured  securities,  that did not have an adverse  change in cash flows
     for which the carrying amount was $46.8.

     Of the  unrealized  losses more than 12 months in  duration of $4.4,  there
     were $3.1 in unrealized  losses that are primarily related to interest rate
     movement or spread  widening  for other than  credit-related  reasons.  The
     remaining  losses of $1.3,  as of December 31, 2004,  related to securities
     reviewed for  impairment  under the guidance  proscribed  by EITF Issue No.
     99-20. This category includes U.S. government-backed securities,  principal
     protected  securities,  and  structured  securities,  that  did not have an
     adverse change in cash flows for which the carrying amount was $13.6.


                                       61

<PAGE>

ReliaStar Life Insurance Company of New York
(A wholly-owned subsidiary of ReliaStar Life Insurance Company)
Notes to Financial Statements
(Dollar amounts in millions, unless otherwise stated)
--------------------------------------------------------------------------------

     The amortized cost and fair value of total fixed  maturities as of December
     31, 2004 are shown below by  contractual  maturity.  Actual  maturities may
     differ from contractual  maturities because securities may be restructured,
     called, or prepaid.

                                                   Amortized           Fair
                                                     Cost              Value
                                                --------------    --------------
     Due to mature:
         One year or less                          $    41.0         $    41.8
         After one year through five years             456.7             474.4
         After five years through ten years            285.1             297.9
         After ten years                               320.5             334.6
         Mortgage-backed securities                    492.5             500.8
         Other asset-backed securities                 107.1             112.1
     Less: fixed maturities pledged to
             creditors                                 149.7             148.5
                                                --------------    --------------
     Fixed maturities, exluding fixed
       maturities pledged                          $ 1,553.2         $ 1,613.1
                                                ==============    ==============

     The Company did not have any  investments  in a single  issuer,  other than
     obligations of the U.S. government,  with a carrying value in excess of 10%
     of the Company's shareholder's equity at December 31, 2004.

     At December 31, 2004 and 2003,  fixed  maturities  with carrying  values of
     $6.0 and $6.1,  respectively,  were on deposit as  required  by  regulatory
     authorities.

     The Company enters into dollar repurchase  agreements  ("dollar rolls") and
     repurchase  agreements  to increase its return on  investments  and improve
     liquidity.  At  December  31,  2004 and  2003,  the  carrying  value of the
     securities pledged in dollar rolls and repurchase agreements was $100.7 and
     $103.8,  respectively.  The  carrying  value of the  securities  pledged in
     dollar rolls and repurchase agreements is included in pledged securities on
     the Balance Sheets.  The repurchase  obligation related to dollar rolls and
     repurchase  agreements  totaled  $100.4 and $101.5 at December 31, 2004 and
     2003,  respectively.  The repurchase obligation related to dollar rolls and
     repurchase agreements is included in borrowed money on the Balance Sheets.

     The  Company  also  enters  into  reverse  repurchase   agreements.   These
     transactions  involve a purchase of  securities  and an  agreement  to sell
     substantially  the same  securities as those  purchased.  Company  policies
     require a minimum of 102% of the fair  value of  securities  pledged  under
     reverse  repurchase  agreements  to  be  pledged  as  collateral.   Reverse
     repurchase  agreements  are  included  in Cash  Equivalents  on the Balance
     Sheets. At December 31, 2004 and 2003, the carrying value of the securities
     in reverse repurchase agreements was $32.0 and $8.0, respectively.


                                       62

<PAGE>

ReliaStar Life Insurance Company of New York
(A wholly-owned subsidiary of ReliaStar Life Insurance Company)
Notes to Financial Statements
(Dollar amounts in millions, unless otherwise stated)
--------------------------------------------------------------------------------

     The Company engages in securities  lending whereby certain  securities from
     its portfolio are loaned to other  institutions  for short periods of time.
     Initial  collateral,  primarily  cash, is required at a rate of 102% of the
     market value of the loaned domestic securities. The collateral is deposited
     by the  borrower  with a lending  agent,  and  retained and invested by the
     lending agent according to the Company's  guidelines to generate additional
     income.  The market value of the loaned  securities is monitored on a daily
     basis with additional  collateral obtained or refunded as the fair value of
     the loaned securities fluctuates.

     The primary risk associated with  short-term  collateralized  borrowings is
     that the  counterparty  will be  unable to  perform  under the terms of the
     contract.  The  Company's  exposure  is  limited  to the  excess of the net
     replacement  cost  of the  securities  over  the  value  of the  short-term
     investments,  an amount that was not  material at December  31,  2004.  The
     Company  believes the  counterparties  to the dollar roll,  repurchase  and
     reverse  repurchase  agreements are  financially  responsible  and that the
     counterparty risk is immaterial.

     Impairments

     The  following   table   identifies   the  Company's   other-than-temporary
     impairments by type:

     <TABLE>
     <S>                         <C>                         <C>                        <C>
                                            2004                        2003                       2002
                                 --------------------------- -------------------------- --------------------------
                                                  No. of                     No. of                     No. of
                                  Impairment    Securities    Impairment   Securities    Impairment   Securities
                                 -------------  ------------ ------------- ------------ ------------- ------------
     U.S. Corporate                $   0.8             1       $   2.7            2       $   0.7            1
     Asset-backed                        -             -           2.0            6           2.3            7
     Equity                              -             -           0.1            1           0.1            1
     Limited Partnerships              0.1             2             -            -             -            -
                                 -------------  ------------ ------------- ------------ ------------- ------------
     Total                         $   0.9             3       $   4.8            9       $   3.1            9
                                 =============  ============ ============= ============ ============= ============

     </TABLE>

     The remaining fair value of impaired fixed maturities at December 31, 2004,
     2003 and 2002 is $4.0, $7.5 and $25.9, respectively.


                                       63

<PAGE>

ReliaStar Life Insurance Company of New York
(A wholly-owned subsidiary of ReliaStar Life Insurance Company)
Notes to Financial Statements
(Dollar amounts in millions, unless otherwise stated)
--------------------------------------------------------------------------------

     Net Investment Income

     Sources of net investment income were as follows:

     <TABLE>
     <S>                                                <C>                <C>                 <C>

                                                                         Year ended December 31,
                                                              2004               2003                2002
                                                        -----------------  ------------------  -----------------
     Fixed maturities                                     $   98.7           $   102.2           $  108.7
     Equity securities                                           -                   -                0.5
     Mortgage loans on real estate                            16.5                18.7               20.7
     Policy loans                                              7.0                 5.8                5.9
     Short-term investments and cash equivalents               0.3                 0.2                0.3
     Other                                                     1.0                (0.9)              (0.7)
                                                        -----------------  ------------------  -----------------
     Gross investment income                                 123.5               126.0              135.4
     Less: investment expense                                 (1.3)               (1.6)              (2.3)
                                                        -----------------  ------------------  -----------------
     Net investment income                                $  122.2           $   124.4           $  133.1
                                                        =================  ==================  =================

     </TABLE>

     Net Realized Capital Gains and Losses

     Net realized capital gains (losses) are comprised of the difference between
     the carrying  value of investments  and sale proceeds from sale,  maturity,
     and redemption,  as well as losses incurred due to the other-than-temporary
     impairment  of  investments.   Net  realized   capital  gains  (losses)  on
     investments were as follows:

     <TABLE>
     <S>                                                <C>                <C>                 <C>

                                                                         Year ended December 31,
                                                              2004                2003               2002
                                                        -----------------   -----------------  -----------------
     Fixed maturities                                     $     9.3           $    10.2          $    (2.5)
     Equity securities                                            -                (0.1)               0.2
     Other                                                     (0.1)                0.5               (0.9)
                                                        -----------------   -----------------  -----------------
     Pretax realized capital gains (losses)               $     9.2           $    10.6          $    (3.2)
                                                        =================   =================  =================
     After-tax realized capital gains (losses)            $     6.0           $     6.9          $    (2.1)
                                                        =================   =================  =================

     </TABLE>


     Proceeds from the sale of total fixed maturities and equity  securities and
     the related gross gains and losses were as follows:

     <TABLE>
     <S>                                                <C>                <C>                 <C>

                                                                         Year ended December 31,
                                                              2004               2003                2002
                                                        -----------------  -----------------   -----------------
     Proceeds on sales                                    $ 1,300.8          $ 1,677.2           $ 1,425.1
     Gross gains                                               14.7               23.7                40.0
     Gross losses                                               4.7               13.5                42.2

     </TABLE>


                                       64

<PAGE>

ReliaStar Life Insurance Company of New York
(A wholly-owned subsidiary of ReliaStar Life Insurance Company)
Notes to Financial Statements
(Dollar amounts in millions, unless otherwise stated)
--------------------------------------------------------------------------------

     Changes in  shareholder's  equity related to changes in  accumulated  other
     comprehensive  income  (unrealized  capital  gains and losses on securities
     including securities pledged) were as follows:

     <TABLE>
     <S>                                                <C>                <C>                 <C>

                                                                         Year ended December 31,
                                                              2004               2003                2002
                                                        -----------------  -----------------   -----------------
     Fixed maturities                                     $   (16.5)         $    (3.3)          $    33.8
     Equity securities                                          0.9               (0.2)                0.1
     DAC/VOBA                                                   3.8                4.4                11.5
     Other                                                      0.1               (0.1)               (0.4)
                                                        -----------------  -----------------   -----------------
     Subtotal                                                 (11.7)               0.8                45.0
     Less: (Decrease) increase in deferred
             income taxes                                      (4.3)               0.4                16.1
                                                        -----------------  -----------------   -----------------
     Net (decrease) increase in accumulated other
        comprehensive (loss) income                       $    (7.4)         $     0.4           $    28.9
                                                        =================  =================   =================

     </TABLE>

     Shareholder's equity included the following accumulated other comprehensive
     income (loss):

     <TABLE>
     <S>                                                <C>                <C>                 <C>

                                                                          As of December 31,
                                                              2004               2003               2002
                                                        -----------------  -----------------  ------------------
     Net unrealized capital gains (losses):
         Fixed maturities                                 $         58.7     $         75.2     $          78.5
         Equity securities                                           0.7               (0.2)                  -
         DAC/VOBA                                                  (14.1)             (17.9)              (22.3)
         Other                                                      (1.2)              (1.3)               (1.2)
                                                        -----------------  -----------------  ------------------
     Subtotal                                                       44.1               55.8                55.0
     Less: Deferred income taxes                                    15.7               20.0                19.6
                                                        -----------------  -----------------  ------------------
     Net unrealized capital gains                                   28.4               35.8                35.4
     Other                                                           1.2                  -                   -
                                                        -----------------  -----------------  ------------------
     Net accumulated other comprehensive
         income                                           $         29.6     $         35.8     $          35.4
                                                        =================  =================  ==================
     </TABLE>


                                       65

<PAGE>

ReliaStar Life Insurance Company of New York
(A wholly-owned subsidiary of ReliaStar Life Insurance Company)
Notes to Financial Statements
(Dollar amounts in millions, unless otherwise stated)
--------------------------------------------------------------------------------

     Changes in  accumulated  other  comprehensive  income related to changes in
     unrealized gains (losses) on securities, including securities pledged, were
     as follows:

     <TABLE>
     <S>                                                <C>                <C>                 <C>

                                                                         Year ended December 31,
                                                              2004                2003               2002
                                                        -----------------   -----------------  -----------------
     Unrealized holding gains (losses) arising
         the year (1)                                      $    (2.7)         $      4.9         $   30.1
     Less: reclassification adjustment for gains
         (losses) and other items included in
         net income (2)                                          4.7                 4.5              1.2
                                                        -----------------   -----------------  -----------------
     Net unrealized gains (losses) on securities           $    (7.4)         $      0.4         $   28.9
                                                        =================   =================  =================

     </TABLE>

     (1)  Pretax unrealized holding gains (losses) were $(3.5),  $7.5 and $46.3,
          for the years ended December 31, 2004, 2003 and 2002, respectively.

     (2)  Pretax reclassification adjustments for gains (losses) and other items
          included in net income were $7.3,  $6.9 and $1.8,  for the years ended
          December 31, 2004, 2003 and 2002, respectively.


3.   Financial Instruments

     Estimated Fair Value

     The following  disclosures are made in accordance with the  requirements of
     FAS No. 107,  "Disclosures about Fair Value of Financial  Instruments." FAS
     No. 107  requires  disclosure  of fair value  information  about  financial
     instruments,  whether or not recognized in the balance sheet,  for which it
     is practicable to estimate that value.  In cases where quoted market prices
     are not available,  fair values are based on estimates  using present value
     or other valuation techniques.  Those techniques are significantly affected
     by the  assumptions  used,  including  the discount  rate and  estimates of
     future cash flows.  In that regard,  the derived fair value  estimates,  in
     many  cases,  could  not  be  realized  in  immediate   settlement  of  the
     instrument.

     FAS No. 107 excludes certain  financial  instruments,  including  insurance
     contracts   and  all   nonfinancial   instruments   from   its   disclosure
     requirements.  Accordingly,  the aggregate fair value amounts  presented do
     not represent the underlying value of the Company.

     The  following  methods  and  assumptions  were  used  by  the  Company  in
     estimating its fair value disclosures for financial instruments:

     Fixed maturities:  The fair values for the actively traded marketable bonds
     are  determined  based upon the quoted market  prices.  The fair values for
     marketable  bonds  without an active  market are obtained  through  several
     commercial  pricing services which provide the estimated fair values.  Fair
     values of  privately  placed  bonds  are  determined  using a  matrix-based
     pricing model. The model considers the current level of risk-free  interest
     rates,  current corporate  spreads,  the credit quality of the issuer,  and


                                       66

<PAGE>

ReliaStar Life Insurance Company of New York
(A wholly-owned subsidiary of ReliaStar Life Insurance Company)
Notes to Financial Statements
(Dollar amounts in millions, unless otherwise stated)
--------------------------------------------------------------------------------

     cash flow  characteristics  of the  security.  Using this  data,  the model
     generates estimated market values which the Company considers reflective of
     the fair value of each  privately  placed bonds.  Fair values for privately
     placed bonds are determined  through  consideration  of factors such as the
     net worth of the borrower,  the value of collateral,  the capital structure
     of the borrower,  the presence of guarantee and the Company's evaluation of
     the  borrower's  ability to compete in their  relevant  market.  Using this
     data,  the model  generates  estimated  market  values  which  the  Company
     considers reflective of the fair value of each privately placed bond.

     Equity  securities:  Fair values of these  securities are based upon quoted
     market value.  For equity  securities not actively  traded,  estimated fair
     values are based upon values of issues of  comparable  yield and quality or
     conversion price where applicable.

     Mortgage  loans on real estate:  The fair values for mortgage loans on real
     estate  are  estimated  using  discounted  cash  flow  analyses  and  rates
     currently  being offered in the  marketplace for similar loans to borrowers
     with  similar  credit  ratings.  Loans  with  similar  characteristics  are
     aggregated for purposes of the calculations.

     Cash,  cash  equivalents,  short-term  investments  and policy  loans:  The
     carrying amounts for these assets approximate the assets' fair values.

     Assets held in separate  accounts:  Assets  held in separate  accounts  are
     reported  at the quoted  fair values of the  individual  securities  in the
     separate accounts.

     Other financial  instruments  reported as assets:  The carrying amounts for
     these financial instruments  (primarily limited  partnerships)  approximate
     those assets' fair values.

     Investment contract liabilities: The fair values for deferred annuities are
     estimated  to be the amount  payable on demand at the  reporting  date,  as
     those  investment  contracts have no defined  maturity and are similar to a
     deposit liability.  The amount payable at the reporting date was calculated
     as the account balance less applicable surrender charges.

     The fair values for supplementary  contracts without life contingencies and
     immediate annuities were estimated using discounted cash flow analyses. The
     discount rate was based upon Treasury rates plus a pricing margin.

     The  carrying  amounts  reported  for  other  investment  contracts,  which
     includes  retirement plan deposits,  approximate  those  liabilities'  fair
     value.

     Liabilities  related to separate accounts:  Liabilities related to separate
     accounts  are reported at full account  value in the  Company's  historical
     balance sheet.  Estimated fair values of separate  account  liabilities are
     equal to their carrying amount.


                                       67

<PAGE>

ReliaStar Life Insurance Company of New York
(A wholly-owned subsidiary of ReliaStar Life Insurance Company)
Notes to Financial Statements
(Dollar amounts in millions, unless otherwise stated)
--------------------------------------------------------------------------------

     The carrying  values and estimated  fair values of certain of the Company's
     financial instruments at December 31, 2004 and 2003 were as follows:

     <TABLE>
     <S>                                                   <C>                          <C>

                                                                       2004                         2003
                                                           ---------------------------- ----------------------------
                                                             Carrying        Fair         Carrying         Fair
                                                              Value          Value         Value          Value
                                                           ------------- -------------- -------------  -------------
     Assets:
         Fixed maturity, including securities pledged       $   1,761.6   $    1,761.6   $   1,719.8    $   1,719.8
         Equity securities                                          7.6            7.6           6.7            6.7
         Mortgage loans on real estate                            213.0          231.5         209.7          235.1
         Policy loans                                              90.9           90.9          86.6           86.6
         Cash, cash equivalents and
           short-term investments under securities
           loan agreement                                          82.5           82.5          12.4           12.4
         Other investments                                         17.0           17.0          13.0           13.0
         Assets held in separate accounts                         537.7          537.7         513.8          513.8
     Liabilities:
         Investment contract liabilities:
         Deferred annuities                                       379.5          377.6         382.9          307.6
         Supplementary contracts and
           immediate annuities                                     31.5           31.5          13.3           13.3
         Liabilities related to separate accounts                 537.7          537.7         513.8          513.8

     </TABLE>

     Fair  value  estimates  are made at a  specific  point  in  time,  based on
     available  market   information  and  judgments  about  various   financial
     instruments,  such as estimates of timing and amounts of future cash flows.
     Such  estimates  do not reflect any premium or discount  that could  result
     from  offering  for sale at one time the  Company's  entire  holdings  of a
     particular financial instrument, nor do they consider the tax impact of the
     realization of unrealized  gains or losses.  In many cases,  the fair value
     estimates cannot be substantiated by comparison to independent markets, nor
     can  the  disclosed  value  be  realized  in  immediate  settlement  of the
     instruments.  In  evaluating  the Company's  management  of interest  rate,
     price,  and liquidity  risks, the fair values of all assets and liabilities
     should be taken into consideration, not only those presented above.

     Derivative Financial Instruments

     Standard & Poor's ("S&P")  Options are used to hedge against an increase in
     the S&P Index. Such increase results in increased reserve liabilities,  and
     the options offset this increased expense. The options are accounted for in
     a consistent manner with the underlying reserve liabilities,  both of which
     are  carried  at fair  value  with  the  change  in value  recorded  in the
     Statements of Operations.  If the options  mature in the money,  the amount
     received  is  recorded  in income to offset the  increased  expense for the
     reserve  liabilities.  The notional  amount,  carrying value, and estimated
     fair value of the Company's open options as of December 31, 2004 were $8.0,
     $0.3, and $0.3,  respectively.  There were no S&P Options outstanding as of
     December 31, 2003.


                                       68

<PAGE>

ReliaStar Life Insurance Company of New York
(A wholly-owned subsidiary of ReliaStar Life Insurance Company)
Notes to Financial Statements
(Dollar amounts in millions, unless otherwise stated)
--------------------------------------------------------------------------------

4.   Deferred Policy Acquisition Cost and Value of Business Acquired

     Activity for the years ended December 31, 2004, 2003 and 2002,  within VOBA
     was as follows:

     Balance at December 31, 2001                                $     64.7
         Adjustment for unrealized gains and losses                    (4.0)
         Additions                                                      4.5
         Interest accrued at 5% - 7%                                    1.1
         Amortization                                                 (18.1)
                                                                ----------------
     Balance at December 31, 2002                                      48.2
         Adjustment for unrealized gains and losses                     6.8
         Additions                                                      3.5
         Interest accrued at 5% - 7%                                    0.5
         Amortization                                                 (22.5)
                                                                ----------------
     Balance at December 31, 2003                                      36.5
         Adjustment for unrealized gains and losses                     3.7
         Additions                                                      3.3
         Interest accrued at 5% - 7%                                    2.8
         Amortization                                                 (12.3)
                                                                ----------------
     Balance at December 31, 2004                                $     34.0
                                                                ================

     The  estimated  amount of VOBA to be amortized,  net of interest,  over the
     next five years is $5.0,  $4.3,  $4.0,  $3.7,  and $3.5 for the years 2005,
     2006,  2007,  2008 and 2009,  respectively.  Actual  amortization  incurred
     during  these years may vary as  assumptions  are  modified to  incorporate
     actual results.

     Analysis of DAC/VOBA - Annuity

     The  actual  separate  account  return  exhibited  by  the  variable  funds
     associated  with the Company's  liabilities  in 2004 exceeded the long-term
     assumption, thereby producing deceleration of DAC/VOBA amortization of $0.1
     before  tax, or $0.07,  net of $0.03 of federal  income tax expense for the
     year ended December 31, 2004.

     During  2003,  the Company  reset  long-term  assumptions  for the separate
     account  returns  from 9.0% to 8.5%  (gross  before fund  management  fees,
     mortality,  expense,  and other policy charges) reflecting a blended return
     of equity and other sub-accounts.  The 2003 unlocking adjustment was driven
     by this change in the separate account returns  assumption along with other
     prospective  assumption changes.  For the year ended December 31, 2003, the
     Company  recorded an  acceleration of DAC/VOBA  amortization  totaling $5.4
     before tax, or $3.5, net of $1.9 of federal income tax benefit.


                                       69

<PAGE>

ReliaStar Life Insurance Company of New York
(A wholly-owned subsidiary of ReliaStar Life Insurance Company)
Notes to Financial Statements
(Dollar amounts in millions, unless otherwise stated)
--------------------------------------------------------------------------------

     As part of the  regular  analysis  of  DAC/VOBA,  at the end of  2002,  the
     Company  unlocked its  long-term  rate of return  assumptions.  The Company
     reset long-term assumptions for the separate account returns to 9.0% (gross
     before fund management fees, mortality,  expense, and other policy charges)
     as of December  31, 2002,  reflecting a blended  return of equity and other
     sub-accounts.   The  unlocking  adjustment  was  primarily  driven  by  the
     sustained  downturn  in the equity  markets and  revised  expectations  for
     future  returns.  During  2002,  the Company  recorded an  acceleration  of
     DAC\VOBA  amortization  totaling  $1.5 before tax, or $1.0,  net of $0.5 of
     federal income tax benefit.

     Analysis of DAC/VOBA - Life

     As part of the  regular  analysis  of  DAC/VOBA,  at the end of each of the
     years ended December 31, 2004,  2003,  and 2002,  the Company  unlocked its
     long-term rate of return  assumptions due to assumption  changes related to
     mortality,  lapse, expense and interest amounts,  portfolio return, as well
     as modeling  improvements.  The impact of unlocking on the  amortization of
     DAC/VOBA was a decrease of $9.8 in 2004, an increase of $5.5 in 2003, and a
     decrease of $4.4 in 2002.


5.   Dividend Restrictions and Shareholder's Equity

     The Company paid $27.2, $25.5 and $14.4 in cash dividends to ReliaStar Life
     in 2004, 2003 and 2002, respectively.

     The Company did not receive  capital  contributions  in 2004 and 2003.  The
     Company   received   capital   contributions   of   $31.4   in  2002   from
     Security-Connecticut,  related to the First Golden merger with and into the
     Company.

     The Company's  ability to pay cash dividends to its parent is restricted by
     law or subject to approval of the insurance  regulatory  authorities of the
     State of New York.  This authority  recognizes  only  statutory  accounting
     practices for determining the ability of an insurer to pay dividends to its
     shareholders.  Without approval of the  Superintendent  of the State of New
     York, the Company may not pay in any calendar year any dividend which, when
     combined  with other  dividends  paid within that calendar year exceeds the
     lesser of (i) 10% of the Company's  statutory surplus at the prior year end
     or (ii) 100% of the Company's  statutory net gain from  operations  for the
     prior calendar year, not including realized capital gains.

     The  Insurance  Department  of the  State of New York  (the  "Department"),
     recognizes as net income,  capital and surplus those amounts  determined in
     conformity with statutory  accounting  practices prescribed or permitted by
     the Department,  which differ in certain  respects from generally  accepted


                                       70

<PAGE>

ReliaStar Life Insurance Company of New York
(A wholly-owned subsidiary of ReliaStar Life Insurance Company)
Notes to Financial Statements
(Dollar amounts in millions, unless otherwise stated)
--------------------------------------------------------------------------------

     accounting  principles in the United States.  Statutory capital and surplus
     of the Company was $260.9, $278.7 and $267.0 at December 31, 2004, 2003 and
     2002,  respectively.  Statutory net gain from operations excluding realized
     capital  gains  (losses)  was $21.0,  $42.8,  and $28.8 for the years ended
     December 31, 2004, 2003, and 2002, respectively.

     As of  December  31,  2004,  the Company  does not  utilize  any  statutory
     accounting  practices,   which  are  not  prescribed  by  state  regulatory
     authorities  that,  individually  or in the  aggregate,  materially  affect
     statutory capital and surplus.


6.   Additional Insurance Benefits and Minimum Guarantees

     Under  SOP  03-1,  the  Company  calculates  additional  liabilities  ("SOP
     reserves") for certain guaranteed  benefits and for universal life products
     with  certain  patterns  of  cost of  insurance  charges.  The SOP  reserve
     recognized  for such products was in addition to the  liability  previously
     held (the  "Account  Value") and was to  recognize  the portion of contract
     assessments  received  in early  years used to  compensate  the insurer for
     services provided in later years.

     In accordance with the methodology outlined in the SOP, the SOP reserve for
     life insurance  products is calculated  using the same  assumptions used in
     the determination of estimated gross profits,  according to which, deferred
     acquisition  costs are amortized.  RLNY calculates a benefit ratio for each
     block of  business  subject to the SOP,  and  calculates  an SOP reserve by
     accumulating   amounts  equal  to  the  benefit  ratio  multiplied  by  the
     assessments  for each period,  reduced by excess death benefits  during the
     period.  The SOP  reserve  is  accumulated  at  interest  rates  using  the
     contract-credited  rate for the period.  The calculated  reserve includes a
     provision for universal  life  contracts with patterns of cost of insurance
     charges  and  certain  other  fees that  produce  expected  gains  from the
     insurance  benefit function  followed by losses from that function in later
     years.

     The SOP reserve for variable  annuity  guaranteed  minimum  death  benefits
     ("GMDB") is  determined  each period by  estimating  the expected  value of
     death benefits in excess of the projected  account  balance and recognizing
     the excess  ratably over the  accumulation  period based on total  expected
     assessments.  The Company regularly  evaluates estimates used to adjust the
     additional  liability  balance,  with a related charge or credit to benefit
     expense,  if actual  experience  or other  evidence  suggests  that earlier
     assumptions should be revised.

     As of December  31, 2004,  the separate  account  liability  for  annuities
     subject to SOP 03-1 due to minimum guaranteed benefits was $0.2.


                                       71

<PAGE>

ReliaStar Life Insurance Company of New York
(A wholly-owned subsidiary of ReliaStar Life Insurance Company)
Notes to Financial Statements
(Dollar amounts in millions, unless otherwise stated)
--------------------------------------------------------------------------------

     The  aggregate  fair  value  of  assets  is  $213.9  of  equity  securities
     (including  mutual funds)  supporting  separate  accounts  with  additional
     insurance  benefits and minimum investment return guarantees as of December
     31, 2004.


7.   Sales Inducements

     Sales   inducements   represent   benefits  paid  to   contractowners   and
     policyholders  that are  incremental to the amounts the Company  credits on
     similar  contracts  and are  higher  than the  contracts  expected  ongoing
     crediting  rates for periods after the  inducement.  As of January 1, 2004,
     such amounts are reported  separately  on the Balance  Sheets in accordance
     with  SOP  03-1.  Prior to  2004,  sales  inducements  were  recorded  as a
     component of DAC on the Balance Sheets.  Sales inducements are amortized as
     a component of benefit expense using methodology and assumptions consistent
     with those used for  amortization  of DAC.  Beginning in 2004,  the Company
     capitalized $1.1 and amortized $0.4 of sales  inducements.  The unamortized
     balance of capitalized  sales  inducements as of December 31, 2004 is $1.3,
     recorded in other assets on the Balance Sheets.


8.   Unpaid Accident and Health Claims


     The change in the liability for unpaid accident and health claims and claim
     adjustment expenses is summarized as follows:

     <TABLE>
     <S>                                          <C>                 <C>                <C>

                                                        2004                2003               2002
                                                  -----------------   -----------------  -----------------
     Balance at January 1                           $    17.0           $    17.5          $    14.5
         Less: Reinsurance recoverable                   11.0                14.2               13.4
                                                  -----------------   -----------------  -----------------
     Net balance at January 1                             6.0                 3.3                1.1
     Incurred related to:
         Current year                                     3.8                 4.0                1.1
         Prior years                                      1.8                 1.3                1.2
                                                  -----------------   -----------------  -----------------
     Total incurred                                       5.6                 5.3                2.3
     Paid related to:
         Current year                                     4.1                   -               (0.2)
         Prior years                                      1.6                 2.6                0.3
                                                  -----------------   -----------------  -----------------
     Total paid                                           5.7                 2.6                0.1
                                                  -----------------   -----------------  -----------------
     Net balance at December 31                           5.9                 6.0                3.3
         Plus: Reinsurance recoverables                   3.7                11.0               14.2
                                                  -----------------   -----------------  -----------------
     Balance at December 31                         $     9.6           $    17.0          $    17.5
                                                  =================   =================  =================

     </TABLE>

     The liability  for unpaid  accident and health claims is included in policy
     liabilities and accruals on the Balance Sheets.


                                       72

<PAGE>

ReliaStar Life Insurance Company of New York
(A wholly-owned subsidiary of ReliaStar Life Insurance Company)
Notes to Financial Statements
(Dollar amounts in millions, unless otherwise stated)
--------------------------------------------------------------------------------

9.   Income Taxes


     The Company files a consolidated federal income tax return with its parent,
     ReliaStar Life. The Company has a federal tax allocation agreement with its
     parent whereby the Company is charged for taxes it would have incurred were
     it not a member of a  consolidated  group and is credited for losses at the
     statutory federal tax rate.

     Income taxes from continuing operations consist of the following:

<TABLE>
<S>                                                          <C>                <C>                <C>

                                                                        Year ended December 31,
                                                              2004               2003               2002
                                                        -----------------  -----------------  ------------------
     Current tax expense:
       Federal                                             $      25.0       $      20.9         $      14.3
                                                        -----------------  -----------------  ------------------
          Total current tax expense                               25.0              20.9                14.3
                                                        -----------------  -----------------  ------------------
     Deferred tax expense:
       Federal                                                    (8.4)              5.4                 3.5
                                                        -----------------  -----------------  ------------------
          Total deferred tax (benefit) expense                    (8.4)              5.4                 3.5
                                                        -----------------  -----------------  ------------------
     Total income tax expense                              $      16.6       $      26.3         $      17.8
                                                        =================  =================  ==================

</TABLE>

     Income  taxes were  different  from the amount  computed  by  applying  the
     federal income tax rate to income from continuing  operations before income
     taxes for the following reasons:

     <TABLE>
     <S>                                                 <C>                <C>                <C>

                                                                        Year ended December 31,
                                                              2004               2003               2002
                                                        -----------------  -----------------  ------------------
     Income from continuing operations
       before income taxes                                 $      47.4        $     80.2         $     50.4
     Tax rate                                                       35%               35%                35%
                                                        -----------------  -----------------  ------------------
     Income tax at federal statutory rate                         16.6              28.1               17.6
     Tax effect of:
       Refinement of deferred tax balances                           -              (1.5)                 -
       Other                                                         -              (0.3)               0.2
                                                        -----------------  -----------------  ------------------
     Income tax expense                                    $      16.6      $       26.3         $     17.8
                                                        =================  =================  ==================

     </TABLE>


                                       73

<PAGE>

ReliaStar Life Insurance Company of New York
(A wholly-owned subsidiary of ReliaStar Life Insurance Company)
Notes to Financial Statements
(Dollar amounts in millions, unless otherwise stated)
--------------------------------------------------------------------------------

     The tax effects of  temporary  differences  that give rise to deferred  tax
     assets and deferred tax liabilities at December 31 are presented below:

                                                     2004              2003
                                                --------------   ---------------
     Deferred tax assets:
         Deferred policy acquisition costs        $      -         $      4.7
         Insurance reserves                           48.2               47.9
         Investment losses                             5.8               10.2
         Legal reserve                                 4.9                5.1
         Premiums                                      5.5                  -
         Other                                         3.9                1.3
                                                --------------   ---------------
             Total gross assets                       68.3               69.2
                                                --------------   ---------------
     Deferred tax liabilities:
         Present value of future profits             (12.3)             (17.1)
         Deferred policy acquisition costs            (1.3)                 -
         Net unrealized capital gains                (20.6)             (26.2)
         Other                                        (1.6)              (5.7)
                                                --------------   ---------------
             Total gross liabilities                 (35.8)             (49.0)
                                                --------------   ---------------
     Net deferred income tax asset                $   32.5         $     20.2
                                                ==============   ===============

     Net  unrealized  capital  gains and losses are  presented as a component of
     other comprehensive income in shareholder's equity, net of deferred taxes.

     Under prior law,  the Company was allowed to defer from  taxation a portion
     of income.  The  deferred  income  was  accumulated  in the  Policyholders'
     Surplus  Account and only becomes taxable under certain  conditions,  which
     management  believes to be remote.  Furthermore,  the American Job Creation
     Act of 2004 allows certain tax-free  distributions  from the Policyholders'
     Surplus  Account  during  2005 and  2006.  Therefore,  based  on  currently
     available  information,  no federal  income taxes have been provided on the
     Policyholders' Surplus Account accumulated balance of $11.3 million.

     The Company  establishes  reserves for  probable  proposed  adjustments  by
     various taxing  authorities.  The Internal  Revenue Service (the "Service")
     has completed examinations of the federal income tax returns of the Company
     for all years through 1999.  There were no material  adjustments  made as a
     result of the examinations.  The Service has commenced its examinations for
     the years 2000  through  2001.  Management  believes  there are  sufficient
     reserves provided for, or adequate defenses against any such adjustments.

     Valuation  allowances  are provided when it is considered  more likely than
     not that deferred tax assets will not be realized.  No valuation  allowance
     has  been  established  at  this  time as  management  believes  the  above
     conditions presently do not exist.


                                       74

<PAGE>

ReliaStar Life Insurance Company of New York
(A wholly-owned subsidiary of ReliaStar Life Insurance Company)
Notes to Financial Statements
(Dollar amounts in millions, unless otherwise stated)
--------------------------------------------------------------------------------

10.  Benefit Plans

     The Company  utilizes the  employees of ING and its  affiliates,  primarily
     ReliaStar Life. Benefit charges to the Company for the years ended December
     31,  2004 and 2003 were not  significant.  There  were no  pension  benefit
     charges allocated to the Company from the ING Americas  Retirement Plan for
     2004.  During 2004 and 2003, the Company was not allocated  charges related
     to the ING  America  Supplemental  Executive  Retirement  Plan that  covers
     certain employees of the Company.

     ING North America Insurance  Corporation ("ING North America") sponsors the
     ING Savings Plan and ESOP (the "Savings Plan"). Substantially all employees
     of ING North America and its  subsidiaries  and  affiliates are eligible to
     participate, including the Company's employees. During 2004, 2003 and 2002,
     the Company matching  contribution charges associated with the Savings Plan
     were not significant.

     In  addition  to  providing  retirement  plan  benefits,  the  Company,  in
     conjunction with ING North America,  provides certain health care insurance
     benefits  for  retired  employees  and  their  eligible   dependents.   The
     post-retirement health care plan is contributory, with retiree contribution
     levels adjusted annually. The life insurance plan provides a flat amount of
     noncontributory   coverage   and   optional   contributory   coverage.   No
     post-retirement  health care benefit  charges were allocated to the Company
     for the years ended December 31, 2004, 2003 and 2002.


11.  Related Party Transactions

     Operating Agreements

     The  Company  has  certain  agreements  whereby  it  incurs  expenses  with
     affiliated entities. The agreements are as follows:

     |X|  Underwriting  agreement with Directed Services,  Inc. ("DSI"), for the
          variable insurance  products issued by the Company.  DSI is authorized
          to  enter  into  agreements  with  broker-dealers  to  distribute  the
          Company's  variable  products  and  appoint   representatives  of  the
          broker-dealers as agents.  For the years ended December 31, 2004, 2003
          and 2002,  expenses  were incurred in the amounts of $2.2,  $1.3,  and
          $0.1, respectively.
     |X|  Investment  advisory  agreement  with ING Investment  Management,  LLC
          ("IIM"), an affiliate, effective January 1, 2001 and amended September
          1, 2004,  under which IIM provides  asset  management  and  accounting
          services.  Under the agreement, the Company records a fee based on the
          value of the assets under  management.  The fee is payable  quarterly.
          For the years ended  December  31,  2004,  2003,  and 2002 the Company
          incurred  fees of  $1.3,  $1.5  and  $2.2,  respectively,  under  this
          agreement.
     |X|  Services  agreement  between the Company and its affiliates  effective
          March 1, 2003,  and amended  effective  August 1, 2004.  For the years
          ended December 31, 2004,  2003, and 2002, net expenses  related to the
          agreement  were  incurred  in the amount of $34.5,  $18.5,  and $21.3,
          respectively.


                                       75

<PAGE>

ReliaStar Life Insurance Company of New York
(A wholly-owned subsidiary of ReliaStar Life Insurance Company)
Notes to Financial Statements
(Dollar amounts in millions, unless otherwise stated)
--------------------------------------------------------------------------------

     Management  and service  contracts and all cost sharing  arrangements  with
     other  affiliated  companies are allocated in accordance with the Company's
     expense and cost allocation methods.

     Reinsurance Agreements

     RLNY  cedes  life  business  to  its  parent,   ReliaStar  Life  under  two
     reinsurance  agreements.  Both  agreements  were put in  place to  reinsure
     amounts in excess of RLNY's  stated  retention  and  continue to accept new
     business on an ongoing basis. The first  reinsurance  agreement,  effective
     April 1, 1984  transfers  the  mortality  risk on a YRT basis on Individual
     Ordinary Life, Waiver of Premium  Disability and Accidental Death insurance
     directly issued by RLNY (or its predecessor).  Under the second reinsurance
     agreement, effective January 15, 1996, ReliaStar Life coinsures all risk on
     level  term  life  insurance  products  directly  issued  by  RLNY  (or its
     predecessor).  Under both reinsurance agreements,  reinsurance premiums are
     paid  annually in advance and are  accounted for and settled on a quarterly
     or more frequent basis.  Payment in settlement of the  reinsurance  under a
     claim approved and paid by RLNY for a life reinsured under these agreements
     is made by the reinsurer upon receipt of the claim papers.  The reinsurance
     recoverable for unpaid losses under these  agreements was $0.8 and $1.2, as
     of December 31, 2004 and 2003, respectively.

     Reciprocal Loan Agreement

     RLNY  maintains  a  reciprocal  loan  agreement  with ING AIH,  a  Delaware
     corporation  and  affiliate,  to facilitate  the handling of unusual and/or
     unanticipated short-term cash requirements. Under this agreement during the
     period from February 1, 2003 to January 31, 2004 and during the period from
     February 1, 2004 to January 31, 2005,  the Company and ING AIH could borrow
     from one  another up to 5% of RLNY's  statutory  admitted  assets as of the
     preceding December 31.

     Interest on any RLNY  borrowing or on any ING AIH borrowing is charged at a
     rate based on the prevailing  rate of U.S.  commercial  paper available for
     purchase with similar duration.  Under this agreement,  the Company did not
     incur  significant  interest income or interest expense for the years ended
     December 31, 2004, 2003 and 2002. At December 31, 2004, the Company did not
     have any balances receivable/payable from/to ING AIH.


                                       76

<PAGE>

ReliaStar Life Insurance Company of New York
(A wholly-owned subsidiary of ReliaStar Life Insurance Company)
Notes to Financial Statements
(Dollar amounts in millions, unless otherwise stated)
--------------------------------------------------------------------------------

     Tax Allocation Agreement

     The Company files a consolidated federal income tax return with its parent,
     ReliaStar Life Insurance Company.  The Company has a federal tax allocation
     agreement with its parent whereby the Company is charged for taxes it would
     have incurred were it not a member of a consolidated  group and is credited
     for losses at the statutory tax rate.


12.  Financing Agreements

     The Company  maintains a  revolving  loan  agreement  with  SunTrust  Bank,
     Atlanta (the "Bank").  Under this  agreement,  which is due on demand,  the
     Company  can borrow up to $30.0 from the Bank.  Interest  on any  borrowing
     accrues at an annual rate equal to a rate quoted by the Bank to the Company
     for  the  borrowing.  Under  the  agreement,  the  Company  did  not  incur
     significant  interest  expense for the years ended December 31, 2004,  2003
     and 2002,  respectively.  At  December  31,  2004,  the  Company had a $2.3
     balance payable to the Bank. At December 31, 2003, the Company did not have
     any  balances  payable  to the Bank.  The  balance  payable  to the Bank is
     include in other liabilities on the Balance Sheets.

     The Company also maintains a revolving loan agreement with Bank of New York
     ("BONY").  Under this  agreement,  the  Company can borrow up to $30.0 from
     BONY.  Interest on any of the Company  borrowing  accrues at an annual rate
     equal to a rate quoted by BONY to the Company for the borrowing. Under this
     agreement,  the Company did not incur significant  interest expense for the
     years ended  December  31,  2004,  2003 and 2002.  At December 31, 2004 and
     2003, the Company did not have any balances payable to BONY.


13.  Reinsurance

     The Company  utilizes excess or quota share treaties to reduce its exposure
     to large  losses.  The Company will only retain  amounts not  exceeding the
     Company's retention limits as stated below.

     At December 31, 2004,  RLNY had  reinsurance  treaties  with 39  authorized
     unaffiliated  reinsurers and 4 affiliated reinsurers covering a significant
     portion of the mortality  risks and  guaranteed  death  benefits  under its
     contracts.  The Company  remains liable to the extent its reinsurers do not
     meet their obligations under the reinsurance agreements.

     The Company's retention limit is $300,000 per insurable life for individual
     retail  coverage.  For group  coverage  and  individual  payroll  deduction
     coverage,   the  retention  is  $500,000  per  life  with  per   occurrence
     limitations, subject to certain maximums. Reinsurance premiums, commissions
     and expense  reimbursements related to reinsured business are accounted for
     on bases consistent with those used in accounting for the original policies


                                       77

<PAGE>

ReliaStar Life Insurance Company of New York
(A wholly-owned subsidiary of ReliaStar Life Insurance Company)
Notes to Financial Statements
(Dollar amounts in millions, unless otherwise stated)
--------------------------------------------------------------------------------

     issued and the terms of the  reinsurance  contracts.  Reserves are based on
     the terms of the  reinsurance  contracts and are  consistent  with the risk
     assumed.  RLNY  obtained  letters  of credit  for  reinsurers  that are not
     registered in the State of New York.  Letters of credit totaling $11.9 were
     obtained from various banks,  including  Fleet Bank,  JPMorgan/Chase  Bank,
     Chase Manhattan Bank, US Bank, Bank One, and Mellon Bank, as well as a line
     of  credit  pool  of 17  banks  that  provides  coverage  to  RLNY  and its
     affiliates.

     At December  31, 2004 and 2003,  net  recoverables  were  comprised  of the
     following:

                                                  2004                2003
                                           ------------------  -----------------
     Claims recoverable from reinsurers      $    23.8           $    14.7
     Payable for reinsurance premiums            (27.7)              (15.4)
     Reinsurance ceded                            77.5                58.1
     Other                                        10.6                 7.7
                                           ------------------  -----------------
     Total                                   $    84.2           $    65.1
                                           ==================  =================

     Premiums,  interest  credited  and other  benefits  to  contractowners  and
     policyholders   included  the  following  premiums  ceded  and  reinsurance
     recoveries:

                                                 Year ended December 31,
                                              2004        2003          2002
                                          -----------  -----------   -----------
     Premiums ceded under reinsurance       $ 41.4       $ 36.0        $ 36.5
     Reinsurance recoveries                   20.8         11.8           7.9


14.  Commitments and Contingent Liabilities

     Leases

     For the years ended  December 31, 2004,  2003,  and 2002,  rent expense for
     leases  was $0.2,  $0.4 and $0.3.  The future net  minimum  payments  under
     noncancelable leases for the years ended December 31, 2005 through 2007 are
     estimated to be $0.1,  $0.1, and $0.1,  respectively.  Minimal payments are
     estimated  for years ended  December  31, 2008 and 2009,  and no future net
     minimum payment is estimated thereafter. The Company pays substantially all
     expenses  associated  with its  leased  and  subleased  office  properties.
     Expenses not paid  directly by the Company are paid for by an affiliate and
     allocated back to the Company.

     Commitments

     Through the normal course of investment operations,  the Company commits to
     either  purchase or sell  securities,  commercial  mortgage loans, or money
     market  instruments at a specified  future date and at a specified price or
     yield.  The  inability of  counterparties  to honor these  commitments  may


                                       78

<PAGE>

ReliaStar Life Insurance Company of New York
(A wholly-owned subsidiary of ReliaStar Life Insurance Company)
Notes to Financial Statements
(Dollar amounts in millions, unless otherwise stated)
--------------------------------------------------------------------------------

     result in either a higher or lower  replacement cost. Also, there is likely
     to be a change in the value of the securities  underlying the  commitments.
     At  December  31,  2004  and  2003,  the  Company  had  off-balance   sheet
     commitments to purchase  investments equal to their fair value of $15.4 and
     $28.9, respectively.

     Litigation

     The  Company  is a party to  threatened  or  pending  lawsuits/arbitrations
     arising  from  the  normal  conduct  of  business.  Due to the  climate  in
     insurance  and business  litigation/arbitration,  suits against the Company
     sometimes include claims for substantial  compensatory,  consequential,  or
     punitive  damages and other types of relief.  Moreover,  certain claims are
     asserted as class  actions,  purporting  to  represent a group of similarly
     situated  individuals.  While it is not possible to forecast the outcome of
     such lawsuits/arbitrations, in light of existing insurance, reinsurance and
     established  reserves, it is the opinion of management that the disposition
     of such  lawsuits/arbitrations will not have a materially adverse effect on
     the Company's operations or financial position.

     Regulatory Matters

     As with many financial services  companies,  the Company and its affiliates
     have received  informal and formal  requests for  information  from various
     state and federal governmental  agencies and self-regulatory  organizations
     in  connection  with  inquiries  and  investigations  of the  products  and
     practices of the financial services industry. In each case, the Company and
     its affiliates have been and are providing full cooperation.

     Fund Regulatory Issues

     Since 2002, there has been increased  governmental and regulatory  activity
     relating to mutual funds and variable insurance products. This activity has
     primarily focused on inappropriate trading of fund shares,  revenue sharing
     and directed  brokerage,  compensation,  sales  practices and  suitability,
     arrangements with service providers,  pricing, compliance and controls, and
     adequacy of disclosure.

     In addition to responding to governmental  and regulatory  requests on fund
     regulatory  issues,  ING  management,  on its  own  initiative,  conducted,
     through  special  counsel  and a national  accounting  firm,  an  extensive
     internal  review of mutual fund trading in ING insurance,  retirement,  and
     mutual fund products. The goal of this review was to identify any instances
     of  inappropriate  trading  in those  products  by third  parties or by ING
     investment professionals and other ING personnel.

     The internal review identified several isolated arrangements allowing third
     parties to engage in frequent  trading of mutual  funds within the variable
     insurance  and mutual fund  products of certain  affiliates of the Company,
     and identified other  circumstances where frequent trading occurred despite
     measures  taken  by ING  intended  to  combat  market  timing.  Each of the
     arrangements  has been  terminated  and  disclosed  to  regulators,  to the



                                       79

<PAGE>

ReliaStar Life Insurance Company of New York
(A wholly-owned subsidiary of ReliaStar Life Insurance Company)
Notes to Financial Statements
(Dollar amounts in millions, unless otherwise stated)
--------------------------------------------------------------------------------

     independent  trustees of ING Funds (U.S.) and in Company reports previously
     filed with the Securities and Exchange  Commission  ("SEC") pursuant to the
     Securities Exchange Act of 1934, as amended.

     An  affiliate  of the  Company,  ING Funds  Distributors,  LLC  ("IFD") has
     received  notice from the staff of the National  Association  of Securities
     Dealers  ("NASD")  that the staff has made a preliminary  determination  to
     recommend that  disciplinary  action be brought  against IFD and one of its
     registered  persons for  violations  of the NASD Conduct  Rules and federal
     securities laws in connection with frequent trading arrangements.

     Other regulators,  including the SEC and the New York Attorney General, are
     also  likely to take some action  with  respect to certain  ING  affiliates
     before concluding their investigation of ING relating to fund trading.  The
     potential  outcome of such action is difficult to predict but could subject
     certain affiliates to adverse consequences,  including, but not limited to,
     settlement payments,  penalties,  and other financial liability.  It is not
     currently anticipated, however, that the actual outcome of such action will
     have a  material  adverse  effect  on ING or ING's  U.S.-based  operations,
     including the Company.

     ING has  agreed to  indemnify  and hold  harmless  the ING  Funds  from all
     damages  resulting  from  wrongful  conduct by ING or its employees or from
     ING's  internal   investigation,   any  investigations   conducted  by  any
     governmental  or  self-regulatory  agencies,  litigation  or  other  formal
     proceedings,  including any proceedings by the SEC.  Management reported to
     the ING Funds Board that ING  management  believes that the total amount of
     any  indemnification  obligations  will  not be  material  to ING or  ING's
     U.S.-based operations, including the Company.

     Other Regulatory Matters

     The New York  Attorney  General and other  regulators  are also  conducting
     broad inquiries and investigations  involving the insurance industry. These
     initiatives currently focus on, among other things,  compensation and other
     sales   incentives,    potential    conflicts   of   interest,    potential
     anti-competitive   activity,   marketing   practices,   certain   financial
     reinsurance  arrangements,  and disclosure.  It is likely that the scope of
     these  investigations  will further broaden before the  investigations  are
     concluded.  U.S.  affiliates  of ING  have  received  formal  and  informal
     requests in connection with such investigations,  and are cooperating fully
     with each request for information.

     These  initiatives  may result in new legislation and regulation that could
     significantly affect the financial services industry,  including businesses
     in which the Company is engaged.

     In light of these and other developments, U.S. affiliates of ING, including
     the Company,  periodically  review whether  modifications to their business
     practices are appropriate.


                                       80

<PAGE>

15.  Reclassifications and Changes to prior Year Presentation

     During 2004,  certain  changes were made to the 2003 and 2002 Statements of
     Cash Flows to reflect the correct balances  primarily related to short-term
     investments and interest  credited to  contractholders  for investment type
     contracts.  As a result of these  adjustments,  the Company has labeled the
     Statements  of Cash  Flows  for 2003 and 2002 as  restated.  The  following
     summarizes the adjustments:


<TABLE>
<S>                                                          <C>            <C>             <C>

                                                              Previously
                                                               Reported      Adjustment       Restated
                                                             -------------  -------------   -------------
Year ended December 31, 2003
    Net cash provided by (used for) operating activities      $ (11.9)        $   17.8        $    5.9
    Net cash used for investing activities                      (37.8)           (40.8)          (78.6)
    Net cash provided by (used for) financing activities         57.7            (30.5)           27.2

Year ended December 31, 2002
    Net cash provided by (used for) operating activities      $  25.2         $   72.5        $   97.7
    Net cash used for investing                                 (61.3)            32.1           (29.2)
    Net cash provided by (used for) financing activities         50.2            (50.6)           (0.4)

</TABLE>


                                       81

<PAGE>
<TABLE>
<S>                                                          <C>             <C>            <C>             <C>

2004 (In millions)                                              First           Second         Third           Fourth
----                                                         -------------   -------------  -------------   -------------

Total revenue                                                 $    77.9       $    69.0      $     75.6      $     74.4
                                                             -------------   -------------  -------------   -------------

Income before income taxes and
    cumulative effect of change in accounting principle            18.5*            1.9*           17.9*            9.1
Income tax expense                                                  6.4*            0.6*            6.3*            3.3
                                                             -------------   -------------  -------------   -------------

Net income before cumulative effect of
    change in accounting principle                                 12.1*            1.3*           11.6*            5.8
Cumulative effect of change in accounting principle                 0.8*              -               -               -
                                                             -------------   -------------  -------------   -------------
Net income                                                    $    12.9*      $     1.3*     $     11.6*     $      5.8
                                                             =============   =============  =============   =============

2003 (In millions)
----
Total revenue                                                 $    74.7       $    82.1      $     75.5      $     63.2

Income before income taxes                                         17.0            24.8            15.4            23.0
Income tax expense                                                  5.9             8.7             5.3             6.4
                                                             -------------   -------------  -------------   -------------
Net income                                                    $    11.1       $    16.1      $     10.1      $     16.6
                                                             =============   =============  =============   =============

</TABLE>

*    Income before cumulative  effect of change in accounting  principle for the
     first, second, and third quarters of 2004, has been restated to include the
     impact of the  implementation  of the TPA,  effective  January 1, 2004. The
     quarterly  adjustment  was  approximately  $1.0,  resulting in a total 2004
     increase of income before tax of $4.0. Also the cumulative effect of change
     in accounting  principle was increased by $7.8,  net of tax effect of $4.2,
     due to the  implementation  of the TPA. See  "Recently  Adopted  Accounting
     Standards" in the "Significant  Accounting  Policies"  footnote for further
     information.


                                       82

<PAGE>

Item 9.   Changes  in  and  Disagreements  with  Accountants  on  Accounting
          and Financial Disclosure

          None.

9A.       Controls and Procedures

          (a)  The Company carried out an evaluation,  under the supervision and
               with the  participation  of its  management,  including its Chief
               Executive   Officer   and  Chief   Financial   Officer,   of  the
               effectiveness  of the  design  and  operation  of  the  Company's
               disclosure  controls and procedures (as defined in Rule 13a-15(e)
               and 15d-15e of the Securities Exchange Act of 1934) as of the end
               of the period covered by this report.  Based on that  evaluation,
               the Chief Executive  Officer and the Chief Financial Officer have
               concluded  that the  Company's  current  disclosure  controls and
               procedures  are effective in ensuring  that material  information
               relating to the Company required to be disclosed in the Company's
               periodic SEC filings is made known to them in a timely manner.

          (b)  There  has not been any  change  in the  internal  controls  over
               financial  reporting  of the  Company  that  occurred  during the
               period covered by this report that has materially  affected or is
               reasonably likely to materially affect these internal controls.

9B.       Other Information

          None.


                                       83

<PAGE>

                                    PART III

Item 10.  Directors and Executive Officers of the Registrant

          Omitted pursuant to General Instruction I(2) of Form 10-K, except with
          respect to compliance with Sections 406 and 407 of the  Sarbanes-Oxley
          Act of 2002.

(a)       Code of Ethics for Financial Professionals
          ------------------------------------------

          The Company has  approved  and adopted a Code of Ethics for  Financial
          Professionals  (which was filed as Exhibit  14 to the  Company's  Form
          10-K,  as filed with the SEC on March 29, 2004,  File No.  333-75938),
          pursuant to the requirements of Section 406 of the  Sarbanes-Oxley Act
          of 2002.  Any waiver of the Code of Ethics  will be  disclosed  by the
          Company by way of a Form 8K filing.

(b)       Designation of Board Financial Expert
          -------------------------------------

          The  Company has  designated  Ross M.  Weale,  as its Board  Financial
          Expert,   pursuant  to  the   requirements   of  Section  407  of  the
          Sarbanes-Oxley Act of 2002. Mr. Weale is an independent director.


Item 11.  Executive Compensation

          Omitted pursuant to General Instruction I(2) of Form 10-K.


Item 12.  Security Ownership of Certain Beneficial Owners and Management

          Omitted pursuant to General Instruction I(2) of Form 10-K.


Item 13.  Certain Relationships and Related Transactions

          Omitted pursuant to General Instruction I(2) of Form 10-K.


                                       84

<PAGE>


Item 14.  Principal Accountant Fees and Services
          (Dollar amounts in millions, unless otherwise stated)

          In 2004 and 2003,  Ernst & Young LLP  ("Ernst & Young")  served as the
          principal   external   auditing  firm  for  ING  including  RLNY.  ING
          subsidiaries,  including  RLNY,  are  allocated  Ernst  &  Young  fees
          attributable to services rendered by Ernst & Young to each subsidiary.
          Ernst & Young  fees  allocated  to the  Company  for the  years  ended
          December 31, 2004 and 2003 are detailed below along with a description
          of the services rendered by Ernst & Young to the Company:

                                               2004                 2003
                                         ------------------  -------------------
          Audit fees                       $     0.5            $     0.2
          Audit-related fees                       -*                   -*
          Tax fees                                 -*                   -*
          All other fees                           -*                   -
                                         ------------------  -------------------
                                           $     0.5            $     0.2
                                         ==================  ===================

             * Less than $0.1


          Audit fees

          Fees for audit  services  include fees  associated  with  professional
          services  rendered  by the  auditors  for  the  audit  of  the  annual
          financial  statements  of the  Company  and  review  of the  Company's
          interim financial statements.

          Audit-related fees

          There were minimal  audit-related  fees  allocated to RLNY in 2004 and
          2003. This category  typically includes assurance and related services
          that are reasonably  related to the performance of the audit or review
          of the financial  statements  and are not reported under the audit fee
          item above.  These services typically consist primarily of an audit of
          SEC product filings,  advice on accounting matters and progress review
          on  International  Financial  Reporting  Standards and  Sarbanes-Oxley
          projects.

          Tax Fees

          There were minimal tax fees  allocated to RLNY in 2004 and 2003.  This
          category  typically  includes  tax  compliance,  tax  advice  and  tax
          planning professional  services.  These services typically consist of:
          tax  compliance  including  the review of  original  and  amended  tax
          returns,  assistance  with  questions  regarding  tax audits,  and tax
          planning  and advisory  services  relating to common forms of domestic
          taxation (i.e. income tax and capital tax).

          All other fees

          There were  minimal fees  allocated  to RLNY under the  category  "all
          other  fees" in 2004 and no fees under  this  category  in 2003.  This
          category  typically includes fees paid for products and services other


                                       85


<PAGE>

          than the audit fees,  audit-related fees and tax fees described above,
          and consists primarily of non-recurring support and advisory services.

          Pre-approval policies and procedures

          RLNY has adopted the  pre-approval  policies  and  procedures  of ING.
          Audit, audit-related and non-audit services provided to the Company by
          ING's independent  auditors are pre-approved by ING's audit committee.
          Pursuant to ING's pre-approval policies and procedures,  the ING audit
          committee is required to  pre-approve  all services  provided by ING's
          independent  auditors to ING and its  majority  owned legal  entities,
          including the Company.  The ING  pre-approval  policies and procedures
          distinguish   four  types  of  services:   (1)  audit  services,   (2)
          audit-related  services,  (3) non-audit  services,  and (4) prohibited
          services (as described in the Sarbanes-Oxley Act).

          The ING  pre-approval  procedures  consist  of a general  pre-approval
          procedure and a specific pre-approval procedure.

          General pre-approval procedure

          ING's audit committee pre-approves audit,  audit-related and non-audit
          services  to be provided  by ING's  external  audit firms on an annual
          basis,  provided that the amount for such pre-approved service may not
          be  exceeded.  ING's  audit  committee  receives  an  overview  of all
          services   provided,   including   related   fees  and   supported  by
          sufficiently  detailed  information.  ING's audit committee  evaluates
          this overview retrospectively on a semi-annual basis.

          Specific pre-approval procedure

          In addition to audit committee  pre-approval,  all  audit-related  and
          non-audit  engagements that are expected to generate fees in excess of
          EUR 100,000 need specific  approval of ING's Chief  Financial  Officer
          ("CFO").  These  engagements  are  submitted in advance to the General
          Manager of ING Corporate Audit Services,  who will advise ING's CFO on
          the  compatibility  of such  services  with the  independence  policy.
          Further, in addition to audit committee pre-approval under the general
          pre-approval  procedures,  the  audit  committee  must  approve  on  a
          case-by-case basis:

          (i)  Each individual  audit-related and non-audit  engagement which is
               expected to generate fees in excess of EUR 250,000;

          (ii) All further audit-related and non-audit engagements over and
               above the pre-approved amounts.

          In 2004, 100% of each of the audit-related  services, tax services and
          all other services were pre-approved by ING's audit committee.


                                       86


<PAGE>

                                     PART IV

Item 15.  Exhibits, Financial Statement Schedules

          (a)  The  following  documents  are filed as part of this  report:
               1.   Financial statements. See Item 8 on Page 39
               2.   Financial  statement  schedules.   See  Index  to  Financial
                    Statement Schedules on Page 90

          Exhibits

          3.(i)Articles of Incorporation of ReliaStar Life Insurance  Company of
               New York ("RLNY" or "Registrant"), incorporated by reference from
               Exhibit 3 (a) to a Pre-Effective  Amendment No. 1 of Registrant's
               Registration  Statement  on Form S-1 filed with the  Security and
               Exchange  Commission  ("SEC") on or about April 1, 2002 (File No.
               333-75938).

          (ii) By-laws of RLNY, incorporated by reference from Exhibit 3(b) to a
               Pre-Effective  Amendment  No.  1  of  Registrant's   Registration
               Statement  on Form S-1  filed  with the SEC on or about  April 1,
               2002 (File No. 333-75938).

          4.(a)Instruments  Defining the Rights of Security  Holders,  Including
               Indentures (Annuity Contracts).

               Interests in Fixed Account I under  Variable  Annuity  Contracts,
               incorporated  herein by  reference  to the  initial  Registration
               Statement  for RLNY as filed with the SEC on April 16, 2002 (File
               No. 333-86352).

10.       Material Contracts

          (a)  Form of Services  Agreement between Directed  Services,  Inc. and
               ReliaStar Life Insurance  Company of New York Fund,  incorporated
               by reference from Exhibit 10.(a) to a Pre-Effective Amendment No.
               1 of Registrant's  Registration  Statement on Form S-1 filed with
               the SEC on or about April 1, 2002 (File No. 333-75938).

          (b)  Federal Tax Sharing Agreement by and between RLNY, ReliaStar Life
               Insurance Company and ReliaStar Financial Corp., effective May 1,
               2002,   incorporated   by  reference   from  Exhibit   10.(e)  to
               Registrant's  Form 10-K filed with the SEC on or about  March 29,
               2004 (File No. 333-75938).

          (c)  Investment  Advisory  Agreement  between RLNY and ING  Investment
               Management,  LLC,  effective  January  1, 2001,  incorporated  by
               reference  from Exhibit  10.(f) to  Registrant's  Form 10-K filed
               with the SEC on or about March 29, 2004 (File No. 333-75938).

          (d)  Reciprocal Loan Agreement  between RLNY and ING America Insurance
               Holdings,  Inc.,  effective  February  1, 2003,  incorporated  by
               reference  from Exhibit  10.(g) to  Registrant's  Form 10-K filed
               with the SEC on or about March 29, 2004 (File No. 333-75938).


                                       87


<PAGE>

          (e)  Reciprocal Loan Agreement  between RLNY and ING America Insurance
               Holdings, Inc., effective February 1, 2004.

          (f)  Administrative   Services   Agreement   between   RLNY   and  its
               affiliates,  effective  March 1, 2003,  incorporated by reference
               from Exhibit 10.(h) to Registrant's  Form 10-K filed with the SEC
               on or about March 29, 2004 (File No. 333-75938).

          (g)  First Amendment to the Administrative  Services Agreement between
               RLNY and its affiliates, effective as of August 1, 2004.

          (h)  Amendment to Investment  Advisory  Agreement between RLNY and ING
               Investment   Management   LLC,   effective   September  1,  2004,
               incorporated  by reference  from Exhibit  10.(i) to  Registrant's
               Form 10-K filed with the SEC on or about March 29, 2004 (File No.
               333-75938).

          (i)  Agreement of Lease,  dated  August 11,  1995,  between The Tilles
               Investment  Company and The North Atlantic Life Insurance Company
               of America,  incorporated  by reference  from  Exhibit  10.(k) to
               Registrant's  Form 10-K filed with the SEC on or about  March 29,
               2004 (File No. 333-75938).

          (j)  First  Amendment to Lease between The Tilles  Investment  Company
               and RLNY, effective June 1, 2001,  incorporated by reference from
               Exhibit 10.(l) to Registrant's Form 10-K filed with the SEC on or
               about March 29, 2004 (File No. 333-75938).

          (k)  Second  Amendment  to Lease dated  August 28,  2002,  between The
               Tilles  Investment   Company  and  ING  North  America  Insurance
               Corporation.

          (l)  Underwriting Agreement between RLNY and Directed Services,  Inc.,
               incorporated  by  reference  from  Exhibit  1 to a  Pre-Effective
               Amendment No. 1 of  Registrant's  Registration  Statement on Form
               S-1 filed with the Securities and Exchange  Commission ("SEC") on
               or about April 1, 2002 (File No. 333-75938).

          (m)  Automatic  Reinsurance  Agreement,  effective  as of January  15,
               1996,  between Lincoln Security Life Insurance Company (now RLNY)
               and  Security-Connecticut  Life Insurance  Company (now ReliaStar
               Life Insurance Company),  as amended by Amendments I through XIII
               dated May 1, 1996;  November  20, 1996;  June 15, 1997;  April 1,
               1998;  September  1,  1998;  April 1,  2000;  November  1,  2001;
               September 9, 2002; June 30, 2003; September 30, 2003; November 1,
               2003; May 1, 2004 and June 14, 2004, respectively.

          (n)  Reinsurance  Agreement,  effective  as of April 1, 1984,  between
               Lincoln   Security   Life   Insurance   Company  (now  RLNY)  and
               Security-Connecticut  Life Insurance  Company (now ReliaStar Life
               Insurance  Company),  as amended by  Amendments  I through  XXIII
               dated April 1, 1986;  January 1, 1987;  January 1, 1987;  July 1,
               1989;  No date;  No date;  January 1, 1994;  November  28,  1995;
               January 1, 1992;  November 1, 1992; January 1, 1994; November 20,
               1996;  May 1, 1996;  July 7, 1997;  April 1, 2000;  September  1,
               1998;  November  1, 2001;  March 1,  2001;  September  30,  2003;
               February 1, 2002; May 1, 2004; June 30, 2004 and October 1, 2004,
               respectively.


                                       88


<PAGE>

          14.  ING Code of Ethics for Financial  Professionals,  incorporated by
               reference  from Exhibit 14 to  Registrant's  Form 10-K filed with
               the SEC on March 29, 2004 (File No. 333-75938).

          31.1 Certificate  of David A. Wheat  pursuant  to  Section  302 of the
               Sarbanes-Oxley Act of 2002.

          31.2 Certificate  of James R.  Gelder  pursuant  to Section 302 of the
               Sarbanes-Oxley Act of 2002.

          32.1 Certificate  of David A. Wheat  pursuant  to  Section  906 of the
               Sarbanes-Oxley Act of 2002.

          32.2 Certificate  of James R.  Gelder  pursuant  to Section 906 of the
               Sarbanes-Oxley Act of 2002.


                                       89


<PAGE>

                     Index to Financial Statement Schedules

                                                                            Page

Report of Independent Registered Public Accounting Firm                      91

I. Summary of Investments - Other than Investments in Affiliates
     as of December 31, 2004                                                 92

IV. Reinsurance Information as of and
       for the years ended December 31, 2004, 2003, and 2002                 93

Schedules  other  than  those  listed  above are  omitted  because  they are not
required or not applicable.


<PAGE>



             Report of Independent Registered Public Accounting Firm


The Board of Directors
ReliaStar Life Insurance Company of New York

We have audited the financial  statements of ReliaStar Life Insurance Company of
New York as of December 31, 2004 and 2003 and for the each of the three years in
the period ended  December 31, 2004,  and have issued our report  thereon  dated
March 31, 2005.  Our audits also  included  the  financial  statement  schedules
listed in Item 15.  These  schedules  are the  responsibility  of the  Company's
management. Our responsibility is to express an opinion based on our audits.

In our  opinion,  the  financial  statement  schedules  referred to above,  when
considered  in  relation  to the basic  financial  statements  taken as a whole,
present fairly in all material respects the information set forth therein.



                                                           /s/ Ernst & Young LLP


Atlanta, Georgia
March 31, 2005


<PAGE>



                  ReliaStar Life Insurance Company of New York
         (A wholly-owned subsidiary of ReliaStar Life Insurance Company)
                                   Schedule I
          Summary of Investments - Other than Investments in Affiliates
                             As of December 31, 2004
                                  (In millions)



<TABLE>
<S>                                                                  <C>               <C>               <C>

                                                                                                             Amount
                                                                                                            Shown on
Type of Investments                                                       Cost             Value*         Balance Sheet
                                                                     ----------------  ----------------  ----------------
Fixed maturities:
    U.S. government and government agencies and authorities            $        56.2     $        56.4     $        56.4
    States, municipalities and political subdivisions                            1.6               1.7               1.7
    U.S. corporate securities                                                  849.5             889.5             889.5
    Foreign securities (1)                                                     196.0             201.1             201.1
    Residential mortgage-backed securities                                     373.5             373.9             373.9
    Commercial mortgage-backed securities                                      119.0             126.9             126.9
    Other asset-backed securities                                              107.1             112.1             112.1
                                                                     ----------------  ----------------  ----------------
       Total fixed maturities, including fixed maturities pledged      $     1,702.9     $     1,761.6    $      1,761.6
                                                                     ================  ================  ================
Equity securities                                                                6.9               7.6               7.6
Mortgage loans                                                                 213.0             231.5             213.0
Policy loans                                                                    90.9              90.9              90.9
Other investments                                                               17.7              17.0              17.0
                                                                     ----------------  ----------------  ----------------
      Total investments                                                $     2,031.4     $     2,108.6     $     2,090.1
                                                                     ================  ================  ================


</TABLE>


*    See Notes 2 and 3 of Notes to Financial Statements.

(1)  The  term  "foreign"  includes  foreign   governments,   foreign  political
     subdivisions,  foreign  public  utilities  and all other  bonds of  foreign
     issuers.   Substantially  all  of  the  Company's  foreign  securities  are
     denominated in U.S. dollars.


                                       92


<PAGE>

                  ReliaStar Life Insurance Company of New York
         (A wholly-owned subsidiary of ReliaStar Life Insurance Company)
                                   Schedule IV
                             Reinsurance Information
         As of and for the year ended December 31, 2004, 2003, and 2002
                                  (In millions)

<TABLE>
<S>                                      <C>              <C>             <C>              <C>              <C>

                                                                                                             Percentage of
                                             Gross            Ceded          Assumed            Net         assumed to net
                                         --------------   --------------  ---------------  --------------   ----------------
Year ended December 31, 2004
Life insurance in force                    $  39,057.9      $  13,659.2     $    4,706.2    $   30,104.9          15.6%

Premiums:                                                                                              -
    Life insurance                                75.3             24.8              5.4            55.9
    Accident and health insurance                 25.4             16.6                -             8.8
                                         --------------   --------------  ---------------  --------------
Total premiums                             $     100.7      $      41.4     $        5.4    $       64.7
                                         ==============   ==============  ===============  ==============

Year ended December 31, 2003
Life insurance in force                    $  38,643.4      $  13,149.6     $    3,715.3    $   29,209.1          12.7%

Premiums:
    Life insurance                                70.8             21.2              4.0            53.6
    Accident and health insurance                 23.0             14.8                -             8.2
                                         --------------   --------------  ---------------  --------------
Total premiums                             $      93.8      $      36.0            $ 4.0    $       61.8
                                         ==============   ==============  ===============  ==============

Year ended December 31, 2002
Life insurance in force                    $  36,310.2      $  12,669.1     $    4,301.9    $   27,943.0          15.4%

Premiums:
    Life insurance                                67.1             21.5              4.0            49.6
    Accident and health insurance                 20.4             15.0                -             5.4
                                         --------------   --------------  ---------------  --------------
Total premiums                             $      87.5      $      36.5     $        4.0    $       55.0
                                         ==============   ==============  ===============  ==============


                                       93

</TABLE>

<PAGE>



                                   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.


                                    ReliaStar Life Insurance Company of New York
                                                   (Registrant)


March 29, 2005                      By /s/ David A. Wheat
--------------                        ------------------------------------------
   (Date)                                  David A. Wheat
                                           Director, Senior Vice President and
                                             Chief Financial Officer
                                           (Duly Authorized Officer and
                                             Principal 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 indicated on or before March 29, 2005.

         Signatures                        Title



/s/ Brian D. Comer
--------------------------------------     Director and Senior Vice President
    Brian D. Comer


/s/ R. Michael Conley
--------------------------------------     Director
    R. Michael Conley


/s/ James R. Gelder
--------------------------------------     Director and Chairman, President and
    James R. Gelder                        Chief Executive Officer


/s/ Catherine H. Smith
--------------------------------------     Director
    Catherine H. Smith


/s/ Ulric Haynes, Jr.
--------------------------------------     Director
    Ulric Haynes, Jr.


/s/ Audrey R. Kavanagh
--------------------------------------     Director and Vice President
    Audrey R. Kavanagh


                                       94

<PAGE>


         Signatures                        Title


/s/ Jamees F. Lille                        Director
--------------------------------------
    James F. Lille


/s/ Gregory G. McGreevey                   Director and Vice President,
--------------------------------------     Investments
    Gregory G. McGreevey


/s/ Stephen J. Preston                     Director and Senior Vice President
--------------------------------------
    Stephen J. Preston


/s/ Mark A. Tullis                         Director
--------------------------------------
    Mark A. Tullis


/s/ Charles B. Updike                      Director
--------------------------------------
    Charles B. Updike


/s/ Ross M. Weale                          Director
--------------------------------------
    Ross M. Weale


/s/ David A. Wheat                         Director, Senior Vice President
--------------------------------------     and Chief Financial Officer
    David A. Wheat


/s/ Roger W. Fisher                        Vice President and Chief Accounting
--------------------------------------     Officer
    Roger W. Fisher


                                       95


<PAGE>

                                                                  Exhibit 10.(e)


                            RECIPROCAL LOAN AGREEMENT


This RECIPROCAL LOAN AGREEMENT (this "Agreement"), dated as of February 1, 2004,
between  ReliaStar Life Insurance Company of New York, a New York life insurance
company  ("RLNY" or  "Company"),  and ING America  Insurance  Holdings,  Inc., a
Delaware  corporation  ("INGAIH"  or  "Company")  located at 1105  North  Market
Street,   Wilmington,   Delaware   19809   (collectively   referred  to  as  the
"Companies").

                                   WITNESSETH:

     WHEREAS,  each of the  Companies  may have,  from  time to time,  a need to
borrow funds on a revolving basis; and

     WHEREAS,  each of the  Companies may have,  from time to time,  excess cash
available to lend to the other on a revolving basis; and

     WHEREAS,  the Companies are affiliated  entities and as such are willing to
extend financing to, and borrow from each other as provided herein; and

     WHEREAS,  each of the  Companies  desires  to  enter  into  this  Agreement
providing  for,  among other things,  the making of such Loans by and among each
other.

     NOW,  THEREFORE,  for and in  consideration of the foregoing and other good
and  valuable  consideration,  the receipt and  sufficiency  of which are hereby
acknowledged, the Companies agree as follows:

                                    ARTICLE 1

                                   DEFINITIONS

         Section 1.1.      Defined Terms.  For purposes of this Agreement:

     "Agreement" shall have the meaning set forth in the preamble hereto.

     "Authorized  Person" shall mean the CFO,  Treasurer,  Assistant  Treasurer,
Treasury Officer,  or Treasury Manager of the Borrowing Company,  or a person so
designated.

     "Borrowing  Company"  shall mean each of the  Companies  to which a Loan is
outstanding or is to be made pursuant to a Request for Borrowing.

     "Business  Day" shall mean a day on which U.S.  financial  markets are open
for the transaction of business required for this Agreement.

     "Companies" shall have the meaning set forth in the preamble hereto.

                                       1

<PAGE>

     "Default" shall mean any of the events specified in Section 6.1, regardless
of whether there shall have occurred any passage of time or giving of notice, or
both, that would be necessary in order to constitute such an Event of Default.

     "Event of Default" shall mean any of the events specified in Section 6.1.

     "INGAIH" shall have the meaning set forth in the preamble hereto.

     "Interest Period" shall mean the number of days or months that a
particular interest rate applies to a particular Loan advanced hereunder.

     "Lending  Company"  shall mean each of the  Companies  that has made, or is
obligated to make, in accordance  with a Request for Borrowing one or more Loans
hereunder.

     "Loans" shall mean the amounts advanced by a Lending Company to a
Borrowing Company under this Agreement.

     "Notice of Borrowing" shall have the meaning set forth in Section 2.2(b) of
this Agreement.

     "Obligations"  shall mean all payment and performance  obligations of every
kind,  nature and description of each Borrowing  Company to the Lending Company,
or either of them, under this Agreement (including any interest,  fees and other
charges  on the Loans or  otherwise),  whether  such  obligations  are direct or
indirect,  absolute or  contingent,  due or not due,  contractual  or  tortuous,
liquidated  or  unliquidated,  arising by  operation  of law or  otherwise,  now
existing or hereafter arising.

     "Regional Treasury Office" ("RTO") shall mean the Treasurer's office of ING
America Insurance Holdings, Inc.

     "Request for Borrowing"  shall have the meaning set forth in Section 2.2(a)
of this Agreement.

     "Revolving Loan Commitment" shall mean the maximum outstanding amount to be
funded by the Lending Company to the Borrowing Company. The aggregate sum, which
shall include both principal and accrued interest,  that the Lending Company may
loan to the Borrowing  Company under this  Agreement  shall not exceed 5% of the
admitted  assets of RLNY as of December 31 of the applicable  preceding year and
as determined by New York Insurance Law Sections 107(a)(3) and 1301.

     "RLNY" shall have the meaning set forth in the preamble hereto.

     "Termination  Date" shall mean  January 31,  2005,  or such earlier date as
payment of the Obligations shall be due (whether by acceleration or otherwise).

                                       2

<PAGE>

     "U.S.  Commercial Paper" shall mean an unsecured promissory note, which has
a maturity  of 270 days or less,  that a company  issues to  finance  short-term
capital needs of the company and is usually issued at a discount.

     Section 1.2.  Terminology.  Each definition of a document in this Article 1
shall include such document as amended,  modified,  or supplemented from time to
time, and, except where the context otherwise  requires,  definitions  imparting
the singular shall include the plural and visa versa.  Except where specifically
restricted, reference to a party shall include that party and its successors and
assigns.  All  personal  pronouns  used in this  Agreement,  whether used in the
masculine,  feminine, or neuter gender, shall include all other genders.  Titles
of articles and sections in this Agreement are for convenience only, and neither
limit nor amplify the provisions of this  Agreement,  and all references in this
Agreement to articles, sections, subsections, paragraphs, clauses, subclauses or
exhibits  shall  refer  to  the  corresponding  article,  section,   subsection,
paragraph,  clause, subclause of, or exhibit attached to, this Agreement, unless
otherwise provided.

         Section 1.3. Accounting Terms. Except as otherwise expressly provided
herein, all accounting terms used herein shall be interpreted in accordance with
generally accepted accounting principles consistently applied.

                                    ARTICLE 2

                               TERMS OF THE LOANS

     Section 2.1. Revolving Credit.

     (a)  Subject  to and  upon  the  terms  and  conditions  set  forth in this
Agreement, each Lending Company agrees to advance to the Borrowing Company, from
time to time prior to the  Termination  Date,  Loans.  Loans  advanced under the
Revolving Loan Commitment shall be repaid in accordance with Section 2.4 and may
be  reborrowed  from time to time on a revolving  basis.  In no event shall RLNY
borrow from a Company that owes money to RLNY.

     (b) Each Borrowing  Company's  obligation to pay to the Lending Company the
principal  of and interest on the Loans shall be evidenced by the records of the
RTO in lieu of a promissory note or notes.

     Section 2.2. Notice and Manner of Borrowing.

     (a) Whenever the Borrowing  Company desires to borrow money  hereunder,  it
shall  give the RTO prior  written  or  facsimile  request  (or  verbal  request
promptly  confirmed in writing or by facsimile) of such borrowing or reborrowing
(a "Request for  Borrowing").  Such Request for  Borrowing  shall be given by an
Authorized Person, to the RTO prior to 10:00 a.m.  (Wilmington,  Delaware time).
Any Request for Borrowing  received after 10:00 a.m. shall be deemed received on
the next Business Day.

                                       3

<PAGE>

     (b) The RTO, upon its receipt of a Request for Borrowing,  shall  determine
if the requested  funds are available and the interest rates in accordance  with
Section 2.3(a) of this Agreement (and related Interest Periods, if any) at which
the  Borrowing  Company can borrow money in a principal  amount equal to, and on
the date of,  the  proposed  borrowing  or  reborrowing  described  in each such
Request for  Borrowing,  and shall notify the Lending  Company of such  interest
rates and the related Interest Periods,  if any, and the principal amount of the
proposed  borrowing  or  reborrowing  (a "Notice  of  Borrowing")  by  telephone
(confirmed  in writing) or by  facsimile  no later than 12:00 p.m.  (Wilmington,
Delaware  time) on the Business Day of the requested  borrowing or  reborrowing.
The RTO shall promptly convey to the Borrowing Company the information contained
in the Notice of Borrowing by telephone (confirmed in writing) or by facsimile.

     (c) On the date of each borrowing,  the Lending Company will make available
the amount of such borrowing or reborrowing  in immediately  available  funds to
the Borrowing  Company by depositing such amount in the account of the Borrowing
Company by wire transfer via electronic funds transfer (EFT).

     (d) The RTO shall maintain on its books a control  account for each Company
in which shall be recorded  (i) the amount of each Loan made  hereunder  to each
such Company, (ii) the interest rate applicable with respect to each Loan, (iii)
the  amount of any  principal,  interest  or fees due or to become due from each
Borrowing  Company  with  respect to the  Loans,  and (iv) the amount of any sum
received by each Lending  Company  hereunder  in respect of any such  principal,
interest  or fees due on such  Loans.  The  entries  made in the  RTO's  control
accounts shall be prima facie evidence, in the absence of manifest error, of the
existence and amounts of Obligations therein recorded and any payments thereon.

     (e) The RTO shall  account  to each  Company  on a  quarterly  basis with a
statement of borrowings,  interest rates,  charges and payments made pursuant to
this  Agreement  with respect to the Loans and  Revolving  Loan  Commitment.  An
Authorized  Person of the Companies  shall review each quarterly  accounting for
accuracy  within thirty days of receipt  thereof from the RTO. Each such account
rendered by the RTO shall be deemed final, binding and conclusive unless the RTO
is notified by the Lending  Company or the Borrowing  Company within thirty days
after the date the account is so rendered that either the Lending Company or the
Borrowing Company disputes any item thereof.

     (f) The RTO shall be justified  in  assuming,  for purposes of carrying out
its duties and obligations under this Agreement,  including, without limitation,
its  obligation  to  maintain  accounts  and  provide  accountings  of the Loans
pursuant to Section  2.2(d) and (e) above,  that (1) Loans are  disbursed by the
Lending  Company to the Borrowing  Company in  accordance  with the terms of the
Notice of Borrowing,  (2) payments on the Loans are made to the Lending  Company
when due,  and (3) no  prepayments  of any Loans prior to the date that they are
due and payable under Section 2.4(a) have occurred,  unless the RTO is otherwise
notified  by either  Company  within  seven  Business  Days of any such  delayed
disbursement, overdue payment, or receipt of a prepayment.

                                       4

<PAGE>

     Section 2.3. Interest.

     (a) The Borrowing  Company  agrees to pay interest in respect of all unpaid
principal  amounts of the Loans from the respective dates such principal amounts
were advanced until the respective dates such principal  amounts are repaid at a
per annum rate  determined by the RTO in accordance with its usual and customary
practices of obtaining quotes of the prevailing U.S.  commercial paper rates for
INGAIH from  recognized  dealers of U.S.  commercial  paper (e.g.  ING  Barings,
BancOne  Capital  Markets and CS First Boston) and  determining  the lowest rate
among the quotes for the applicable  term of the Loan. The actual  interest rate
charged to the Borrowing  Company shall be the lowest quoted  effective  rate of
U.S. commercial paper for the applicable term of the Loan. Documentation of such
quotes and the rate so  determined  shall be  maintained by INGAIH in accordance
with Section 2.5.

     (b) Overdue  principal and, to the extent not prohibited by applicable law,
overdue  interest in respect of any of the Loans and all other  overdue  amounts
owing hereunder shall bear interest from each date that such amounts are overdue
at the rate otherwise  applicable to such underlying Loans plus an additional 2%
per annum.  Interest on each Loan shall  accrue from and  including  the date of
such  Loan to,  but  excluding,  the date of any  repayment  thereof;  provided,
however, that if a Loan is repaid on the same day it is made, one day's interest
shall be paid on such Loan. Interest shall be computed on the basis of a year of
360 days for the actual number of days elapsed.

     (c) The  Companies  hereby  agree  that the only  charges  imposed or to be
imposed by the Lending Company hereunder for the use of money in connection with
the Loans is and will be the interest  required to be paid under the  provisions
of Sections  2.2(b).  In no event  shall the amount of interest  due and payable
under this  Agreement or any other  documents  executed in  connection  herewith
exceed the maximum rate of interest  allowed by applicable law and, in the event
any such  payment is made by the  Borrowing  Company or  received by the Lending
Company, such excess sum shall be credited as a payment of principal.  It is the
express intent hereof that the Borrowing Company not pay and the Lending Company
not receive,  directly or indirectly  in any manner,  interest in excess of that
which may be lawfully paid under applicable law.

     Section 2.4. Repayment of Principal and Interest.

     (a) The entire outstanding  principal balance of the Loans shall be due and
payable by no later than 5:00 p.m.  (Wilmington,  Delaware time) on the Business
Day on which the Loan is due,  together  with all  remaining  accrued and unpaid
interest  thereon,  unless an extension of no more than three additional days is
authorized by the Lending Company.

                                       5

<PAGE>

     (b) Any of the Loans may be prepaid in whole or in part at any time without
premium or  penalty.  Any such  prepayment  made on any Loan  shall be  applied,
first,  to interest  accrued  thereon  through the date  thereof and then to the
principal balance thereof.

     (c) Each payment and  prepayment  of principal of any Loan and each payment
of  interest  on any Loan shall be made to the  Lending  Company  and applied to
outstanding  Loan balances in the  following  order;  first,  toward any Loan or
Loans then due and  payable;  and,  second,  towards the Loan or Loans which are
next due and payable at the time of such prepayment.

     Section 2.5. Documentation

     (a) The  obligations  of any Company to repay all principal of and interest
on Loans made  pursuant to this  Agreement  are set forth in this  Agreement and
shall be fully binding and  enforceable  without the execution of any promissory
note or other evidence of indebtedness.  Expenses  incurred and payment received
shall be  allocated  to each  Company in  comformity  with  customary  insurance
accounting practices consistently applied and the books, accounts and records of
each Company shall be so maintained  as to clearly and  accurately  disclose the
precise  nature  and  details of the  transactions,  including  such  accounting
information as is necessary to support the reasonableness of the charges or fees
to the respective parties.

     (b) Records of all Loans that are made under this  Agreement and all monies
paid back shall be kept by INGAIH on behalf of the parties.

                                    ARTICLE 3

                         REPRESENTATIONS AND WARRANTIES

     Section 3.1. Representations and Warranties. In order to induce the Lending
Company to enter into this Agreement,  the Borrowing  Company hereby  represents
and warrants as set forth below:

     (a)  Organization;   Power;  Qualification.  The  Borrowing  Company  is  a
corporation  or life  insurance  company,  as the case may be,  duly  organized,
validly  existing  and in good  standing  under  the  laws of the  state  of its
organization,  has the  power and  authority  to own or lease  and  operate  its
properties  and to carry on its  business  as now being  conducted,  and is duly
qualified  and  in  good  standing,  and  authorized  to do  business,  in  each
jurisdiction  in which the  character  of its  properties  or the  nature of its
business require such qualification or authorization.

     (b) Authorization;  Enforceability. The Borrowing Company has the power and
has taken all  necessary  action,  including  the  approval  of RLNY's  Board of
Directors,  to  authorize it to execute,  deliver and perform this  Agreement in
accordance with the terms hereof and to consummate the transactions contemplated
hereby.  This  Agreement  has been duly  executed and delivered by the Borrowing
Company and is a legal,  valid and binding  obligation of the Borrowing Company,
enforceable in accordance with its respective  terms, (i) subject to limitations
imposed  by  general  principles  of  equity  and  (ii)  subject  to  applicable


                                       6
<PAGE>

bankruptcy,   reorganization,   insolvency  and  other  similar  laws  affecting
creditors' rights generally and to moratorium laws from time to time in effect.

     (c) No Conflict. The execution,  delivery and performance of this Agreement
in  accordance  with  its  terms  and  the   consummation  of  the  transactions
contemplated  hereby  do not and  will not (i)  violate  any  applicable  law or
regulation,  (ii) conflict with,  result in a breach of, or constitute a default
under the charter or by-laws of the  Borrowing  Company or under any  indenture,
agreement or other  instrument to which the  Borrowing  Company is a party or by
which it or any of its  properties  may be bound,  or (iii) result in or require
the creation or  imposition of any lien upon or with respect to any property now
owned or hereafter acquired by the Borrowing Company.

     (d) Compliance with Law;  Absence of Default.  The Borrowing  Company is in
compliance  with all  applicable  laws the  failure to comply  with which has or
could  reasonably  be  expected  to  have a  materially  adverse  effect  on the
business, assets,  liabilities,  financial condition or results of operations of
the  Borrowing  Company,  and no event has occurred or has failed to occur which
has not been  remedied or waived,  the  occurrence  or  non-occurrence  of which
constitutes a Default.

     Section   3.2.   Survival   of   Representations   and   Warranties.    All
representations  and warranties  made under this Agreement shall be deemed to be
made, and shall be true and correct, as of the date hereof and as of the date of
each Loan.

                                    ARTICLE 4

                              AFFIRMATIVE COVENANTS

     So long as this Agreement is in effect:

     Section 4.1.  Preservation  of Existence.  The  Borrowing  Company will (a)
preserve and maintain its existence, rights, franchises, licenses and privileges
in its  jurisdiction  of organization  and (b) qualify and remain  qualified and
authorized  to do business in each  jurisdiction  in which the  character of its
properties  or the  nature  of  its  business  requires  such  qualification  or
authorization.

     Section 4.2. Compliance with Applicable Laws and Regulations. The Borrowing
Company will comply with the requirements of all applicable laws and regulations
the failure with which to comply could have a materially  adverse  effect on the
business, assets,  liabilities,  financial condition or results of operations of
the Borrowing Company.

     Section 4.3. Visits and Inspections.

     (a) Upon reasonable advance notice from the Lending Company,  the Borrowing
Company  will permit  representatives  of the  Lending  Company to (a) visit and
inspect the properties of the Borrowing  Company during normal  business  hours,


                                       7
<PAGE>

(b) inspect and make extracts from and copies of its books and records,  and (c)
discuss  with  its  principal  officers  its  businesses,  assets,  liabilities,
financial positions and results of operations.

     (b) Each Company agrees that upon reasonable advance notice from an auditor
of either  Company or any  regulatory  official  employed by the  Department  of
Insurance  of any state in which  either  Company is engaged in  business,  each
Company will prepare and deliver to such auditor or regulatory official,  within
a reasonable  time following such request,  a written  verification of all Loans
made to and by the relevant  Company.  Upon  reasonable  advance  notice to each
Company,  the books and  records  of the RTO and each  Company  relating  to the
subject  matter of this  Agreement  shall be  available  for  inspection  by any
auditor of either  Company or any  regulatory  official  during normal  business
hours,  and the RTO and  each  Company  will  cooperate  with  said  auditor  or
regulatory  official in making any audit which requires inspection of said books
and records.

                                    ARTICLE 5

                               NEGATIVE COVENANTS

     So long as this Agreement is in effect:

     Section 5.1. Liquidation;  Merger; Sale of Assets; Change of Business.  The
Borrowing  Company shall not at any time,  without  proper notice to the Lending
Company:

     (a) Liquidate or dissolve itself (or suffer any liquidation or dissolution)
or otherwise wind up;

     (b) Merge or consolidate with any other person or entity;

     (c) Sell,  lease,  abandon  or  otherwise  dispose  of or  transfer  all or
substantially  all of its assets other than in the ordinary  course of business;
or

     (d) Make any  substantial  change in the type of business  conducted by the
Borrowing Company as of the date hereof without the prior written consent of the
Lending  Company if such  action  would have a  material  adverse  effect on the
business, assets,  liabilities,  financial condition or results of operations of
the Borrowing Company.

     Any corporation into which either Company may be merged,  converted or with
which either Company may be consolidated,  or any corporation resulting from any
merger,  conversion or  consolidation  to which either Company shall be a party,
shall  succeed  to all  either  Company's  rights,  obligations  and  immunities
hereunder without the execution or filing of any paper or any further act on the
part  of  any  of  the  parties   hereto,   anything   herein  to  the  contrary
notwithstanding.


                                       8
<PAGE>

                                    ARTICLE 6

                                     DEFAULT

     Section 6.1. Events of Default.  Each of the following shall  constitute an
Event of Default:

     (a) Any representation or warranty made by the Borrowing Company under this
Agreement shall prove incorrect or misleading in any material respect when made;

     (b) The Borrowing  Company shall default in the payment of (i) any interest
payable under this Agreement within five days of when due, or (ii) any principal
payable under this Agreement within three days of when due;

     (c) The Borrowing Company shall default in the performance or observance of
any agreement or covenant  contained in this  Agreement,  and such Default shall
not be cured within a period of 30 days from the occurrence of such Default;

     (d) The  Borrowing  Company  shall  default  under any other  agreement  or
instrument  evidencing or relating to any  indebtedness  which Default shall not
have been cured within any applicable grace period set forth therein;

     (e) There shall be entered a decree or order by a court having jurisdiction
in the  premises  constituting  an order for relief in respect of the  Borrowing
Company  under  Title  11 of the  United  States  Code,  as now  constituted  or
hereafter  amended,  or any other applicable  federal or state bankruptcy law or
similar law, or appointing a receiver, liquidator, assignee, trustee, custodian,
sequestrator, or similar official of the Borrowing Company or of any substantial
part of its properties, or ordering the winding-up or liquidation of the affairs
of the Borrowing  Company and any such decree or order shall  continue in effect
for a period of 60 consecutive days;

     (f) The Borrowing Company shall file a petition,  answer or consent seeking
relief under Title 11 of the United States Code, as now constituted or hereafter
amended,  or any  other  applicable  federal  or state  bankruptcy  law or other
similar  law, or the  Borrowing  Company  shall  consent to the  institution  of
proceedings  thereunder  or to  the  filing  of  any  such  petition  or to  the
appointment  or  taking  of  possession  of a  receiver,  liquidator,  assignee,
trustee,  custodian,  sequestrator,  or other similar  official of the Borrowing
Company or of any substantial part of its properties,  or the Borrowing  Company
shall fail generally to pay its debts as such debts become due, or the Borrowing
Company shall take any corporate action in furtherance of any such action; or

     (g) This  Agreement or any  provision  hereof shall at any time and for any
reason be declared by a court of competent  jurisdiction to be null and void, or
a proceeding shall be commenced by the Borrowing  Company or any other person or
entity seeking to establish the invalidity or  unenforceability  thereof, or the


                                       9

<PAGE>

Borrowing Company shall deny that it has any liability or any obligation for the
payment of principal or interest purported to be created under this Agreement.

     Section 6.2. Remedies. If an Event of Default shall have occurred and shall
be continuing,

         (a) The obligation of the Lending Company to make Loans hereunder shall
immediately cease;

         (b) With the exception of an Event of Default specified in Section
6.1(e) or (f), the Lending Company, shall declare the principal of and interest
on the Loans and all other amounts owed under this Agreement to be forthwith due
and payable, whereupon all such amounts shall immediately become absolute and
due and payable, without presentment, demand, protest, or notice of any kind,
all of which are hereby expressly waived, anything in this Agreement to the
contrary notwithstanding, and whereupon all such amounts shall be immediately
due and payable;

         (c) Upon the occurrence and continuance of an Event of Default
specified in Section 6.1(e) or (f), such principal, interest and other amounts
shall thereupon and concurrently therewith become absolute and due and payable,
all without any action by the Lending Company, all of which are hereby expressly
waived, anything in this Agreement to the contrary notwithstanding;

         (d) The Lending Company shall have the right and option to exercise all
of the post-default rights granted to them hereunder; and

         (e) The Lending Company shall have the right and option to exercise all
rights and remedies available to them at law or in equity.

                                    ARTICLE 7

                                  MISCELLANEOUS

     Section 8.1. Notices.  Except as otherwise provided herein, all notices and
other  communications  required or permitted  under this  Agreement  shall be in
writing and, if mailed,  shall be deemed to have been received on the earlier of
the date shown on the receipt or three Business Days after the  postmarked  date
thereof  and, if sent by  facsimile,  shall be followed  forthwith by letter and
shall be  deemed  to have  been  received  on the next  Business  Day  following
dispatch and acknowledgment of receipt by the recipient's  facsimile machine. In
addition,  notices hereunder may be delivered by hand or overnight  courier,  in
which event the notice shall be deemed effective when delivered. All notices and
other  communications  under this Agreement shall be given to the parties at the
address or facsimile number listed below such party's  signature line hereto, or
such other  address or  facsimile  number as may be  specified by any party in a
writing addressed to the other parties hereto.


                                       10
<PAGE>

     Section 8.2. Waivers.  The rights and remedies of the Lending Company under
this  Agreement  shall be cumulative and not exclusive of any rights or remedies
which they would  otherwise  have. No failure or delay by the Lending Company in
exercising  any right  shall  operate  as a waiver of it.  The  Lending  Company
expressly reserves the right to require strict compliance with the terms of this
Agreement. In the event the Lending Company decides to fund a request for a Loan
at a time when the Borrowing  Company is not in strict compliance with the terms
of this  Agreement,  such decision by the Lending Company shall not be deemed to
constitute an  undertaking by the Lending  Company to fund any further  requests
for Loans or precluding the Lending Company from exercising any rights available
to it under the  Agreement  or at law or equity  with  respect to the  Borrowing
Company.  Any waiver or  indulgence  granted by the  Lending  Company  shall not
constitute a  modification  of this  Agreement,  except to the extent  expressly
provided in such waiver or indulgence,  or constitute a course of dealing by the
Lending  Company at variance with the terms of this Agreement such as to require
further notice by the Lending Company of its intent to require strict  adherence
to the terms of this Agreement in the future.  Any such actions shall not in any
way  affect  the  ability  of the  Lending  Company,  in their  respective  sole
discretion,  to exercise any of their respective  rights under this Agreement or
under any other agreement.

     Section 8.3. Assignment; Successors.

     (a) The  Borrowing  Company may not assign or transfer any of its rights or
obligations hereunder without notice to the Lending Company.

     (b) The  Lending  Company  may not at any time  assign or  participate  its
interest  under this  Agreement  without  notice to the Borrowing  Company.  Any
holder of a  participation  in, and any  assignee or  transferee  of, all or any
portion of any amount owed by the  Borrowing  Company  under this  Agreement may
exercise any and all rights  provided in this  Agreement with respect to any and
all amounts owed by the Borrowing Company to such assignee, transferee or holder
as fully as if such  assignee,  transferee  or holder  had made the Loans in the
amount of the obligation in which its holds a participation or which is assigned
or transferred to it.

     (c) This Agreement  shall be binding upon, and inure to the benefit of, the
Borrowing Company, the Lending Company, and the permitted successors and assigns
of each party hereto.

     Section 8.4. Counterparts.  This Agreement may be executed in any number of
counterparts,  each of which  shall be  deemed to be an  original,  but all such
counterparts shall together constitute but one and the same instrument.

     Section  8.5.  Severability.  Any  provision  of this  Agreement  which  is
prohibited  or  unenforceable  shall  be  ineffective  to  the  extent  of  such
prohibition or unenforceability  without  invalidating the remaining  provisions
hereof in that  jurisdiction or affecting the validity or enforceability of such
provision in any other jurisdiction.


                                       11

<PAGE>


     Section 8.6. Entire Agreement;  Amendments.  This Agreement  represents the
entire  agreement among the parties hereto with respect to the subject matter of
this  transaction.  No amendment or  modification of the terms and provisions of
this  Agreement  shall  be  effective  unless  in  writing  and  signed  by both
Companies.

     Section 8.7. Payment on Non-Business Days.  Whenever any payment to be made
hereunder  shall be stated to be due on a non-Business  Day, such payment may be
made on the next  succeeding  Business Day, and such  extension of time shall in
such case be included in the computation of payment of interest hereunder.

     Section 8.8.  Termination.  Unless earlier terminated,  this Agreement will
expire one year from its date unless  sooner  extended by written  agreement  of
both parties for an additional  annual term.  The renewal of this  Agreement for
any  additional  one year terms shall be approved by the Board of  Directors  of
RLNY.  Any such annual  extension must have the prior review and approval of the
New York Insurance Department.  Each annual submission to the New York Insurance
Department shall include a history of RLNY's borrowings under this Agreement for
the previous year.  This  Agreement may be terminated  with respect to any party
hereto by such party upon its  giving  the other  parties 30 days  notice of its
intent to terminate.  In the event of termination as provided in this paragraph,
the Lending  Company's  obligation to make Loans to the Borrowing  Company shall
cease;  provided,  however,  that the  Borrowing  Company  shall  continue to be
obligated to make all  repayments of Loans and all other amounts due and payable
by it as provided under this Agreement.

     Section 8.9. Prior Agreements.  This Agreement  replaces and supercedes all
other intercompany  credit  agreements,  and is effective as of the day and year
first  above  written,  subject to any  required  regulatory  notifications  and
approvals.

     IN WITNESS  WHEREOF,  the parties  hereto have executed  this  Agreement or
caused it to be executed by their duly  authorized  officers,  all as of the day
and year first above written.

                        RELIASTAR LIFE INSURANCE COMPANY
                          OF NEW YORK



                        By:/s/  William D. Bonneville
                           -----------------------------------------------------
                                William D. Bonneville

                        Title:  Executive Vice President and Chief
                                  Administrative Officer

                                Address for notices:
                                1000 Woodbury Road, Suite 208
                                Woodbury, New York 11797
                                Phone:516-682-8780
                                Fax:  516-682-8852


                                       12
<PAGE>


                        ING AMERICA INSURANCE HOLDINGS, INC.



                        By:/s/ David S. Pendergrass
                           -----------------------------------------------------
                               David  S. Pendergrass

                               Title: Treasurer

                               Address for notices:
                               1105 N. Market Street
                               Wilmington, DE 19809
                               Phone: 770/980-3300
                               Fax: 770/980-3301


                                       13

<PAGE>

                                                                  Exhibit 10.(g)


                                 FIRST AMENDMENT
                                     TO THE
                        ADMINISTRATIVE SERVICES AGREEMENT


This  First  Amendment,  effective  as  of  August  1,  2004,  is  made  to  the
Administrative Services Agreement (the "Agreement"),  dated as of March 1, 2003,
entered into by and between  ReliaStar Life Insurance Company of New York, a New
York insurance  company and the affiliated  companies  specified in Exhibit A to
the Agreement.

IN CONSIDERATION,  of the mutual promises set forth herein,  and intending to be
legally bound hereby, the parties agree to amend the Agreement as follows:

     1. The Agreement  shall be amended to add the following new section:  TERM.
This Agreement  shall be effective on the first day of March 2003, and shall end
of the 31st day of March, 2005. This Agreement shall be automatically renewed on
the first day of each calendar year  thereafter for a twelve-month  period under
the same terms and  conditions,  subject to the provisions for  termination  set
forth therein.

     2. Except as specifically  amended by this First  Amendment,  the Agreement
remains in full force and effect.

     IN WITNESS WHEREOF, the parties have caused this First Amendment to be duly
executed as of the date first written above.

RELIASTAR LIFE INSURANCE COMPANY OF NEW YORK


By:/s/   Paula Cludray-Engelke
   -----------------------------------------
Name:    Paula Cludray-Engelke
Title:     Secretary

ING USA ANNUITY AND LIFE INSURANCE COMPANY


By:/s/ Paula Cludray-Engelke
   -----------------------------------------
Name:  Paula Cludray-Engelke
Title:   Secretary


ING FINANCIAL ADVISERS, LLC


By:/s/   John F. Todd
   -----------------------------------------
Name:    John F. Todd
Title:   Assistant Secretary


                                       1
<PAGE>


ING LIFE INSURANCE AND ANNUITY COMPANY


By:/s/  Paula Cludray-Engelke
   ------------------------------------------
Name:  Paula Cludray-Engelke
Title: Secretary


ING NORTH AMERICA INSURANCE CORPORATION


By:/s/   John F. Todd
   ------------------------------------------
Name:    John F. Todd
Title:   Assistant Secretary

RELIASTAR LIFE INSURANCE COMPANY


By:/s/   Paula Cludray-Engelke
   ------------------------------------------
Name:    Paula Cludray-Engelke
Title:   Secretary


SECURITY LIFE OF DENVER INSURANCE COMPANY


By:/s/   Paula Cludray-Engelke
   -----------------------------------------
Name:    Paula Cludray-Engelke
Title:   Secretary


SOUTHLAND LIFE INSURANCE COMPANY


By:/s/   Paula Cludray-Engelke
   -----------------------------------------
Name:    Paula Cludray-Engelke
Title:   Secretary


                                       2
<PAGE>

                                                                  Exhibit 10.(k)


                            SECOND AMENDMENT TO LEASE

     This Amendment made the 28th day of August, 2002, by and between THE TILLES
INVESTMENT COMPANY, having offices at 7600 Jericho Turnpike,  Woodbury, New York
11797,  hereinafter  referred  to as  the  "Landlord"  and  ING,  NORTH  AMERICA
INSURANCE COMPANY,  successor in interest to RELIASTAR LIFE INSURANCE COMPANY OF
NEW YORK,  successor in interest to RELIASTAR  BANKERS  SECURITY LIFE  INSURANCE
COMPANY  a/k/a THE NORTH  ATLANTIC  LIFE  INSURANCE  COMPANY OF AMERICA,  having
offices at 151  Farmington  Avenue,  Hartford,  Connecticut  06156,  hereinafter
referred to as the "Tenant",

                                    RECITALS

     WHEREAS,  Landlord  and Tenant are  parties to a written  rental  agreement
dated August 11, 1995 which was amended by written agreement dated May 31, 2001,
(as amended,  the "Lease") for certain space consisting of 23,440 square feet in
the building and premises  (the  "Original  Premises")  located at 1000 Woodbury
Road, Woodbury, New York; and

     WHEREAS, the parties are desirous of entering into an agreement which would
provide for, among other things a  relinquishment  and surrender of the Original
Premises and occupancy of additional  and different  space in the same building.

     NOW THEREFORE,  in  consideration of TEN ($10.00)  DOLLARS,  the receipt of
which is hereby acknowledged, and for other good and valuable consideration, the
receipt  and  sufficiency  of which is  hereby  acknowledged,  it is  agreed  as
follows:

     FIRST:  Effective as of the 31st day of October,  2002,  the Tenant  hereby
vacates, surrenders, and releases to the Landlord, all of the Original Premises,
subject further to the terms and conditions of this  agreement.  Landlord agrees
to accept the  surrender  of the  original  premises  in their  present  "as-is"
condition,  reasonable wear and tear and casualty damage excepted.  Tenant shall
have no obligation  to remove any of its  improvements,  furniture,  fixtures or
equipment including, without limitation its phone system or any wiring or cable.
Other than those items  specifically  and  expressly  set forth in the  previous
sentence, the premises will be delivered vacant and free of debris.


                                       1

<PAGE>


     SECOND:  Landlord  shall  enter  into and  execute  a Lease  for all of the
demised  property  with  MortgageIt,  Inc. no later than the 27th day of August,
2002,  upon such terms and conditions as may be  satisfactory  and acceptable to
Landlord.  In the event that the aforesaid Lease is not executed by the close of
business on August 27, 2002, this agreement shall be null and void.
     THIRD:  Simultaneously  upon execution of the Lease with MortgageIt,  Inc.,
and receipt of payment set forth in paragraph 4 below,  Landlord hereby releases
Tenant, its predecessors,  successors and assigns and their respective officers,
directors, shareholders, employees and agents from all liability with respect to
the Original  Premises  accruing  subsequent  to August 31, 2002.  The foregoing
Release shall be effective  notwithstanding  any delay by Landlord in delivering
the new premises to Tenant,  unless said delay is occasioned either in whole, or
in part, by Tenant.
     FOURTH:  Tenant shall pay to the  Landlord,  within three (3) business days
from the date upon which Landlord  notifies Tenant of the execution of the Lease
with MortgageIt,  Inc., as consideration  for its release of the released space,
the  sum  of  THREE  HUNDRED   TWENTY-TWO   THOUSAND  SEVEN  HUNDRED  FIFTY-NINE
($322,759.00)  DOLLARS;  the  additional  sum of ONE  HUNDRED  FIFTEEN  THOUSAND
($115,000.00)  DOLLARS as contribution  by the Tenant to construction  costs for
the released space;  and the additional sum of ONE HUNDRED EIGHT  THOUSAND,  TWO
HUNDRED TWENTY-FIVE  ($108,225.00) DOLLARS, which sum shall represent payment of
monthly basic rent due from MortgageIt, Inc. to Landlord for the first three (3)
months of the demised term.
     FIFTH:  Effective  the 1st day of November,  2002 the space  designated  on
Exhibit "A" in the Lease and First Amendment shall be further amended to reflect
a  relocation  by  Tenant  to space  located  on the  second  floor,  Suite  208
consisting of 4,943 rentable  square feet, in the building and premises  located
at 1000 Woodbury Road,  Woodbury,  New York, and more particularly  described in
Exhibit "A" attached to the Second  Amendment (the "new  premises").
     SIXTH: The basic term of this Lease (hereinafter referred to as the "term")
shall  commence  upon the date the Landlord  gives notice to the Tenant that the
Landlord  has  substantially  completed  the work set  forth on the work  letter
attached hereto as Exhibit "B" (the "commencement  date"). In the event that the
commencement date occurs prior to November 1, 2002, Tenant shall not be required
to pay rent on the new space  until  November  1, 2002.  The term  substantially
completed  as used  herein  shall be deemed to mean so  complete as to allow the


                                       2

<PAGE>

Tenant to enter the new  premises  and  conduct its normal  business  operations
therein even though there may be minor items of decoration or construction to be
completed.  Any incomplete  items  preventing  Tenant from commencing  occupancy
shall not be an  objection  if said items are to be  installed  or  furnished by
Tenant,  or if  Tenant  has  contributed  to said  delay.  All work set forth on
Exhibit "B" shall be  performed  at the  Landlord's  sole  expense in a good and
workmanlike  manner and in accordance  with all applicable  laws, At the time of
the  commencement  of the Lease the Landlord  shall have received a temporary or
permanent  Certificate of Occupancy for the new premises  (unless any work to be
done  therein,  by the  Tenant,  shall  prevent  the  issuance  of  either  such
Certificate  of Occupancy)  and the  air-conditioning,  heating,  plumbing and '
electrical systems in the new premises and the elevator in the building shall be
in working order and the said new premises shall be free of debris.
     SEVENTH:  The parties  expect that the term of this Lease will  commence on
the first day of November, 2002 and end on the 31st day of October, 2007. In the
event, however,  that the Landlord is unable to substantially  complete the work
set forth on Exhibit "B" by reason of strikes,  inability  to obtain  materials,
governmental regulation,  acts of God or other matters beyond Landlord's control
then, and in that event,  Tenant shall continue to occupy the original  premises
until the commencement  date but the Release set forth in Article 3 shall remain
in full force and effect.
     EIGHTH:  This Lease,  as amended shall be extended for a period of five (5)
years, commencing as of the commencement date and terminating on midnight of the
day prior to the fifth anniversary date based upon the following rent schedule:

                                         Basic Annual Rent   Monthly Basic Rent
                                         -----------------   ------------------
 November 1, 2002 - October 31, 2003         $112,453.25         $9,371.10
 November 1, 2003 - October 31, 2004         $116,108.04         $9,675.67
 November 1, 2004 - October 31, 2005         $119,881.44         $9,990.12
 November 1, 2005 - October 31, 2006         $123,777.60        $10,314.80
 November 1, 2006 - October 31, 2007         $127,800.36        $10,650.03

Promptly  following  the  commencement  date the  parties  agree to execute  and
deliver a commencement date agreement  memorializing the commencement  date, the
termination  date,  and setting forth the  applicable  dates of each Lease Year.


                                       3

<PAGE>

     NINTH: Section 1.1 shall be amended so as to provide that (i) the number of
reserved parking spaces in the executive  parking lot shall be reduced from four
(4) to two (2), and (ii) the number of  unreserved  spaces  available for Tenant
shall be not less than eighteen  (18).
     TENTH:  Article II is hereby  amended to include a new Section 2.5 thereof,
which shall read as follows:
     Section 2.5 - Tenant shall have a one time option to cancel this  agreement
at the  expiration  of the  third  Lease  year  subject  to  the  following:
     1.  Notification  by Tenant of its desire to exercise  this option shall be
give to the  Landlord,  not later  than  January  31,  2006,  time  being of the
essence.
     2. Tenant is not in default in any of the terms,  covenants and  conditions
of the Lease at the time notice of  cancellation  is given,  or at the effective
date thereof.
     3. Simultaneously with the transmission of notice to exercise its option to
cancel,  Tenant shall include  payment to the Landlord in the sum of $25,900.00,
which sum is neither a penalty nor a forfeiture,  but constitutes  reimbursement
of unamortized  construction costs and Brokerage fees.
     ELEVENTH:  Article  III of the Lease is hereby  amended,  to  include a new
Section 3.4, which shall read as follows:
     Section 3.4 As  additional  rent during each and every year during the term
hereof and any renewals or  extensions  the Tenant shall pay to the Landlord its
proportionate  share of any  increase  in Real Estate  taxes over the  2002-2003
School Tax,  and the 2002 Town Tax.
     A.  Landlord  and  Tenant  covenant  and agree  that for  purposes  of this
Article, or at such other place as the term  "proportionate",  "pro-rata share",
or words of similar  import and  intent  are used in the Lease,  Tenant's  share
shall constitute 2.15%.
     B. Tenant shall  similarly  pay its  proportionate  share as  determined in
sub-paragraph A above of any ad valorem assessments,  or impositions against the
real property of which the Demised  Premises  form a part and its  proportionate
share  of any  taxes  which  shall be  imposed  in lieu of any ad  valorem  real
property tax as the same is presently  considered,  except that the Tenant shall
not .be obligated to pay any portion of any  assessment  or imposition  (whether
payable in  installments  or  otherwise)  which have  become a lien prior to the
commencement  of the term of this  Lease.  In the event that there  shall be any
general or special  assessments  or  impositions  against the said real property
which the Tenant is obligated to pay a proportionate  share, the Landlord agrees
that if the said assessments or impositions may be paid in installments that the


                                       4

<PAGE>

Landlord will elect to pay the same in installments and the Tenant shall only be
responsible to pay its proportionate share of those installments which cover the
period  of the term of the  Lease.
     TWELFTH:  Article  IV of the  Lease is  hereby  amended,  to  include a new
Section 4.6,  which shall read as follows:
     Section 4.6  Throughout  the term of this Lease,  Landlord shall supply and
Tenant shall pay for the electricity in the Demised  Premises and for the common
areas for normal  lighting,  The Tenant  shall use no electric  equipment in the
Demised Premises other than desktop computers,  servers,  routers,  copiers, fax
machines,  and other  normal  small  office  business  machines,  If the  Tenant
introduces  equipment  onto the  premises  other than other  normal small office
business  machines,  Tenant shall reimburse Landlord for the cost of electricity
necessary  for  same.  The  Landlord  covenants  to  provide  and pay for  heat,
air-conditioning,  elevator  service and  electricity  between the hours of 8:00
a.m.  and  6:00p.m.  Monday  through  Friday and  Saturday  between the hours of
8:00a.m. to 1:00p,m.. However, if one of the days above is a "Holiday", the HVAC
system shall not be in operation.  The term "Holiday"  shall mean New Years Day,
Presidents Day,  Memorial Day,  Independence  Day, Labor Day,  Thanksgiving  and
Christmas,  and such  other  Holidays  as may,  from time to time be  nationally
recognized.
     The cost of electricity to the Tenant, during the term of this Lease, shall
be  determined  as  follows:
     Tenant shall pay the sum of  $12,357.50  per year payable in equal  monthly
installments of $1,029.79 in advance. In the event that any time during the term
of this Lease Landlord's cost per kWh shall be increased above $.16 per kWh (the
average annual kWh in effect during the last 12 months) then, in that event upon
presentation to Tenant of reasonable documentation evidencing such increase, the
percentage of such increase shall be paid to the Landlord as additional  rent as
hereinabove  provided.
     THIRTEENTH:  The work letter described as Exhibit "C" in Section 5.1 of the
original  Lease dated  August 11, 1995 is hereby  amended to include and reflect
the work letter and plans attached to this amendment as Exhibit "B".
     FOURTEENTH: A. Tenant acknowledges that the sole and exclusive Broker which
brought  about the Lease with  MortgageIt,  Inc. is Julian  Studley and that the
sole and exclusive  Broker who brought about the Lease for the premises  demised
herein is CB Richard Ellis.  Landlord agrees to pay the commission due and owing
CB  Richard  Ellis for the  commission  earned on the  demised  space and Tenant


                                       5

<PAGE>

agrees to indemnify  and hold harmless  Landlord  against any claims or expenses
which the  Landlord  may incur by reason of the  Tenant  having  dealt  with any
Broker other than CB Richard  Ellis in connection  with this Lease.
     B. Landlord agrees that it shall pay that portion of the commission due and
owing to Julian  Studley which is  attributed  the last three years of the Lease
with  MortgageIt,  Inc. and agrees to indemnify and hold harmless Tenant against
any claims or  expenses  which  Tenant may incur by reason  thereof.
     C. Tenant  agrees to pay that  portion of the  commission  due and owing to
Julian  Studley  which is  attributed to the first three years of the Lease with
MortgageIt,  Inc. and agrees to indemnify and hold harmless Landlord against any
and all claims or expenses which Landlord may incur by reason  thereof,  or from
any other Broker.
     FIFTEENTH:  Tenant shall have one (1) five year option to renew the term of
Tenant's Lease provided:
     1. Tenant is not in default in the terms,  covenants and  conditions of the
Lease at the time of notification  of Tenant's  intention to exercise its option
or at the  commencement  of the option  term;
     2. Tenant  shall  provide  written  notice not later than January 31, 2007,
time being of the  essence,  of Tenant's  intention  to  exercise  its option to
renew.
     3. This option is for the benefit of the Tenant and any assignees of Tenant
which control, are controlled by, or under common control with Tenant.
     4. All of the terms,  covenants and conditions of the Lease shall remain in
full force and effect.
     5. The said renewal shall be the basic rent during the last year during the
term of this Lease, increased by 3.25%, and, further increased by 3.25% for each
and every year of the  remaining  term.
     SIXTEENTH:  Section 4.5 of the Lease is hereby  amended to provide that the
Tenant  shall not be liable for any  supervisory  or other fees to  Landlord  in
connection with its relocation  from the original  premises to the new premises,
including,  without limitation any charges for the freight elevator,  so long as
the relocation occurs on any weekday between the hours of 9:00a.m. and 5:00 p.m.
Supervisory  fees  incurred by Tenant  pursuant  to the terms of this  paragraph


                                       6

<PAGE>

shall be  deemed  items of  additional  rent and  shall be billed at the rate of
$30.00   for  each   hour,   or   fractionional   part   thereof.
     SEVENTEENTH: Notwithstanding anything to the contrary set forth in Sections
6.3 and 22.3 of the Lease or otherwise,  Tenant shall not be obligated to remove
any Tenant improvements, wiring or cabling from the original premises or the new
premises.
     EIGHTEENTH:  Notwithstanding  anything set forth in Section 11.1 of theease
or  otherwise,  Landlord  and Tenant each hereby  release and waive all right of
recovery  against the other or anyone claiming  through or under each of them by
way of  subrogation  or  otherwise  for any loss  which is covered by a standard
all-risk casualty insurance policy.  Landlord and Tenant further agree that each
insurance  policy  carried by them with respect to the new  premises  and/or the
building  of which the new  premises  comprise a part shall  include a waiver of
subrogation  by the insurance  carrier in favor of the other party.
     NINETEENTH:  Sections 11.3 and 12.2(i) of the Lease are hereby  modified to
provide lit any rent abatement pursuant to either subsection shall be equitable.
     TWENTIETH:  The  Landlord  shall  request  from the holder of any  Mortgage
hereinafter  placed upon the property of which the demised  premises form a part
the issuance of its standard form non-disturbance  letter in favor of the Tenant
provided further that said non-disturbance  clause can be obtained at no cost to
Landlord.  Landlord  further  agrees to make a reasonable  effort to obtain said
non-disturbance  letter.
     TWENTY-FIRST:  Pursuant to Article 17 of the Lease,  Landlord  acknowledges
that Tenant's present notice address is 151 Farmington Avenue (TN41),  Hartford,
Connecticut 06156-9690, Attention: Corporate Real Estate Department.
     TWENTY-SECOND:  The Phrase "that it may" hereby  replaces "to" in the first
line of  Section  22.1.
     TWENTY-THIRD:  The sixty (60) day  period set forth in Section  22.3 of the
Lease is  hereby  reduced  to thirty  (30)  days.  Further,  the Lease is hereby
modified to provide that the  provisions  of Section 22.4 shall not apply to any
transaction with any entity that controls,  is controlled by, or is under common
control  with  Tenant.
     TWENTY-FOURTH:  Section  30.1 is modified  to provide  that Tenant will pay
150% of the monthly rate for the time Tenant  remains in possession for a period
not to exceed  sixty (60) days and 200%  thereafter.  Said  paragraph is further
modified to provide that  Tenant's  liability  for  consequential  damages only,


                                       7

<PAGE>

shall accrue if Tenant  remains in  possession  for a period  longer than ninety
(90) days.  All other damages for which Tenant shall be liable,  shall accrue if
Tenant  remains  in  possession  for a  period  longer  than  sixty  (60)  days.
     TWENTY-FIFTH:  The foregoing  provisions  are intended to modify said Lease
only in the foregoing  respects and such  modifications  and the terms hereof as
herein set forth are to be strictly construed,  It is further agreed that except
as hereinabove provided all of the terms, covenants and conditions of said Lease
dated the 11th day of August,  1995 and amended the 31st day of May,  2001 shall
continue to remain in full force and effect as therein written and shall be read
and construed together with this instrument.
     TWENTY-SIXTH: This Amendment may be signed in separate counterparts, all of
which taken together,  shall constitute a single agreement.
     In witness  whereof,  the parties  hereto have hereunto set their hands and
seals the day and year first above written.

THE TILLES INVESTMENT COMPANY              ING NORTH AMERICA
                                           INSURANCE COMPANY


By: /s/  Peter Tilles                       By: /s/  Ron Falkner
   --------------------------                  ---------------------------------


     IN WITNESS  WHEREOF,  the parties  hereto have hereunto set their hands and
seals the day and year first above written.

                                            THE TILLES INVESTMENT COMPANY



                                            By: /s/  Peter Tilles
                                                --------------------------------


                                            MORTGAGEIT, INC.



                                            By: /s/ Larry P. Lewis
                                                --------------------------------
                                                    Larry P. Lewis
                                                    Chief Operating Officer


                                       8
<PAGE>

                                    Exhibit A

                            Furniture Plan omitted.
<PAGE>

                                   Exhibit - B
                                   WORK LETTER
                                       ING
                               1000 Woodbury Road
                               Woodbury, NY 11797

                                  June 5, 2002
                             Revised August 22, 2002
                             Revised August 26, 2002

All work shall be as indicated on the following construction documents:
         1 of 8              Title Sheet                                 Undated
         4 of 8              Furniture & Demolition Plan                  7/2/02
         5 of 8              Construction & Ceiling Plan                  7/2/02
         6 of 8              Panel & Finish Plan                          7/2/02
         7 of 8              Door Schedule, Details & Elevations          7/2/02
         8 of 8              Details & Elevation                          7/2/02
         Bulletin # 1        Drawing 2                                   8/20/02
                             ING -- Standard Finishes                    Undated

as prepared by               Jung / Brannan Associates, Inc.
                             One Waterville Road
                             Farmington, Connecticut 06032

1.   PARTITIONING
-----------------
All new partitions  provided by the Landlord shall consist  of.5/8" gypsum board
applied  to 2  1/2"  metal  studs  and  shall  extend  to the  underside  of the
acoustical  ceiling grid. Sound attenuating  insulation shall be provided in all
new partitions.  Demising  partitions shall consist of 5/8" gypsum board applied
to 3 1/2" metal  studs 16" o/c.  with  sound  attenuating  insulation  and shall
extend from the concrete  floor slab to the  underside  of the floor above.  The
amount of such partitioning shall be as indicated on me plan attached.  Landlord
shall remove and dispose of existing partitions as required to complete the work
of this alteration.

Fire rates enclosures of all columns,  air shafts and demising  partitions shall
be constructed in accordance with the requirements of the New York State uniform
Fire Prevention and Building Code.

2.   DOORS AND BUCKS
--------------------
Landlord shall relocate the existing wood doors and metal knock down door frames
as  necessary  to  complete  the work as  indicated.  Landlord  shall  reuse the
existing  Building  Standard  Atheans levers as  manufactured  by Schlage.  This
hardware shall comply with the requirements of the Americans with Disability Act
A maximum of four (4) locksets shall be included as part of this work letter.


<PAGE>

3. PAINTING AND FINISHES
------------------------
All new  partitions  provided by the Landlord shall be painted with two coats of
Benjamin  Moore paint as  indicated on the  attached  ING finish  schedule.  The
partitions of the conference rooms and reception area shall receive Type I vinyl
wallcovering  as indicated on the  attached  ING finish  schedule.  All existing
doors shall be finished with a coat of clear varnish and all door jambs shall be
finished with an oil based semi gloss paint.

4.   FLOORING
-------------
Landlord shall remove the existing carpeting throughout the Demised Premises and
shall  furnish and install new  carpeting  as per ING standard  finishes.  Vinyl
composition  moor tile shall be provided in the kitchen area,  storage and telco
room. All partitions provided by the Landlord shall receive 4" vinyl cove base.

5.   CEILING
------------
Landlord shall remove me existing ceiling tiles throughout the Demises Premises
and shall furnish and install Armstong Second Look I ceiling dies. Sound
attenuating insulation shall be installed above the acoustical ceiling as noted
on the plans attached.

6.   ELECTRIC
-------------
Landlord shall furnish and install the new electric outlets and circuitry in
accordance with the National Electrical Code and as per the plan attached. Power
wiring of the Tenant's equipment is not included unless outlined in this exhibit
or indicated on plan attached. This work shall be wired from the existing
building electrical distribution system.

7. LIGHTING
-----------
Landlord  shall  rearrange the existing  light fixtures as indicated on the plan
attached.  These  fixtures  shall be  recessed  and  shall  have 1 1/2" x 1 1/2"
paracube  lenses  Landlord  shall reuse  existing  fixtures  and  devices  where
possible.

8.   HEATING, VENTILATION AND AIR CONDITIONING
----------------------------------------------
Landlord  shall  reconfigure  me existing  supply  registers and return  grilles
throughout the Demised Premises. This work shall be completed in accordance with
the original building design and building standards. Registers and grilles shall
be cleaned prior to installation.  All registers throughout the Demised Premises
shall tie  connected  to the existing  mechanical  systems.  The general  design
criteria  for air  conditioning  shall be 74 degrees F.  inside when the outside
temperature  is 95 degrees F. Heating shall  provide 70 degrees  inside when the
outside temperature is 5 degrees F.


<PAGE>

Landlord   shall   install   the   supplemental   cooling   only  unit  for  the
telecommunication room as noted. The Tenant shall be responsible for all cost of
the unit delivered to the construction  site. At the option of the ING, Landlord
or Tenant shall  purchase  the Liebert - Mini Mate unit as  specified  after the
submission of an additional work order indicating the Landlord's cost.

9.   MISCELLANEOUS
------------------
Landlord shall furnish and install the fallowing items as indicated on the plans
attached:

     1.   Plastic  laminate  kitchen  countertop,  cotta as indicated on the ING
          standard  finishes.
     2    Building  Standard  upper and lower  kitchen  cabinets  with a lowered
          section for the kitchen sink.
     3.   Building Standard window treatment on all exterior windows.

Tenant shall provide and install the  following  items at the Tenant's sole cost
and expense:

     1.   All furniture and equipment  including  reception desk and secretarial
          stations, unless otherwise indicated in this exhibit.
     2.   All signage and Interior directories.
     3.   All built-in cabinetry work including  bookshelves.
     4.   Appliances and vending machines.

The Tenant shall arrange, at the Tenant's sole cost and expense,  for the moving
of  all  furniture  and  equipment,  dismantle  and  assembly  of  all  moveable
partitioning  and ether work  necessary to complete the work of this  alteration
not outlined in this Work Letter.

10.  NOTES
----------
All subcontractors,  hired by the Tenant,  stall coordinate  schedules and moves
with the  Landlord's  office  to  ensure a smooth  and  controlled  construction
sequence.

All delays, caused as a result of changes by me Tenant shall not modify the date
of possession and the commencement of rent payments by the Tenant.

All work of this alteration shall be completes during normal business hours.

                                 END OF SECTION

<PAGE>

                              ING-STANDARD FINISHES


FLOOR FINISHES:
--------------------------------------------------------------------------------
CARPET:                                            4" VINYL WALLBASE:
------                                             -----------------
Mfg:     Shaw                                      Mfg:    Johnsonite
Spec:    Contact Rick Gondon                       Color:   #40 Black
         @ 800-424-7429 x6556 for pricing and
         specification information
VINYL COMPOSITION TILE:
----------------------
Mfg:     Armstrong Premium Excelon
Style:   Stonetex
Color:   52143-Sandstone Tan

WALL FINISHES:
VINYL WALLCOVERING:
------------------
Mfg:       Surface Materials
Style:     Contrex
Style #:   V-12035

PAINT:
-----
General Wall Cover: (Off White)                    Accent Wall Color:
Mfg:       Benjamin Moore                          Mfg:     Benjamin Moore
Finish:    Regal Aqua Velvet                       Finish:  Regal Aqua Velvet
Color:     #232                                    Color:   #1203 (Terra Cotta)

Door Frames:                                       Accent   Wall Color:
Mfg:       Benjamin Moore                          Mfg:     Benjamin Moore
Finish:    Semi-Gloss                              Finish:  Regal Aqua Velvet
Color:     Black                                   Color:   HC-154 (Navy Blue)

Accent Wall Cover:
-----------------
Mfg:       Pittsburgh Paints
Finish:    Latex Eggshell
Color:     #317-5-Cracker Bitz (Tan)

WALL FINISHES:
-------------
PLASTIC LAMINATES (Cabinetry/Millwork):
Mfg:       Nevamar                                 Mfg:   Nevamar
Color:     Foundry/Textured                        Color: Maize Shibori/Textured
Number:    #S-2-84T                                Number:  #SH-2-2T

Mfg:       Nevamar                                 Mfg:   Nevamar
Color:     Black/Textured                          Color: Ochre Tempera/Textured
Number:    #S-6-1T                                        Number:  #TM-2-1T

Mfg:       Nevamar
Color:     Charcoal Matrix/Textured
Number:    #MR-6-2T

SOLID SURFACES (Reception Countertop):
Mfg:       Corian
Color:     Midnight Sierra Family


<PAGE>

                                                                 Exhibit 10. (m)



                         AUTOMATIC REINSURANCE AGREEMENT

                        Effective as of January 15, 1996

                                   Between the




                     LINCOLN SECURITY LIFE INSURANCE COMPANY
                   (hereinafter referred to as the "Company")


                                       And


                   SECURITY-CONNECTICUT LIFE INSURANCE COMPANY
                  (hereinafter referred to as the "Reinsurer")



                                       1

<PAGE>



                         AUTOMATIC REINSURANCE AGREEMENT

                                Table of Contents

                                                                            Page

ARTICLE I ...................................................................4

     Basis of Reinsurance

     Automatic Coverage

     Special Automatic Coverage

     Exceptions to Automatic Coverage

     Facultative Reinsurance

ARTICLE II ..................................................................6

     Notification of Cession

     Policy Forms

     Notification of Underwriting Rules

ARTICLE III .................................................................7

     Commencement and Termination of Liability

ARTICLE IV ..................................................................8

     Oversights - Clerical Errors

ARTICLE V ...................................................................9

     Plan of Reinsurance

ARTICLE VI..................................................................10

     Reinsurance Premiums

         Life Premiums

ARTICLE VII.................................................................11

     Premium Tax Credits

ARTICLE VIII................................................................13

     Reinsurance Administration

ARTICLE IX..................................................................15

     Reductions

ARTICLE X...................................................................16

     Retention Limit Increases (Recapture)

ARTICLE XI..................................................................17

     Extended and Paid-Up Insurance

                                       2

<PAGE>


ARTICLE XII ................................................................18

     Reinstatements

ARTICLE XIII ...............................................................19

     Policy Changes

ARTICLE XIV ................................................................20

     Settlement of Claims

ARTICLE XV .................................................................23

     Records

ARTICLE XVI ................................................................23

     Insolvency

ARTICLE XVII................................................................24

     Arbitration



ARTICLE XVIII...............................................................25

     Parties to Agreement

ARTICLE XIX.................................................................26

     Duration of Agreement

ARTICLE XX .................................................................27

     Entire Agreement

EXHIBIT I ..................................................................29

     Maximum Retention Limits

     Automatic Binding Limits

REINSURANCE PREMIUM ALLOWANCES..............................................30

EXHIBIT II

ELIGIBLE PLANS OF INSURANCE ................................................32

EXHIBIT III

TERMS FOR SPECIFIC POLICY REPLACEMENT & EXCHANGE SITUATION..................33


EXHIBIT IV


                                       3


<PAGE>

                                    ARTICLE I

                              Basis of Reinsurance

1.   On and after the fifteenth day of January 1996,  amounts of individual life
     insurance which have been issued by the Company to standard and substandard
     lives on any of the plans of  insurance  listed in  Exhibit  III,  shall be
     automatically  reinsured  under  this  Agreement  on the basis  hereinafter
     stated. Once the Company has retained its maximum retention limit on a risk
     as specified in Exhibit I, the entire amount in excess of such amount shall
     be  automatically  reinsured  under  this  Agreement  with  the  Reinsurer.
     Excepted are risks  excluded from automatic  coverage under  paragraph 4 of
     this  Article  and  policies   written  by  agencies   whose   business  is
     specifically reinsured elsewhere or other defined classes of business which
     are to be automatically reinsured elsewhere. The Reinsurer shall be advised
     of the  classes  of  business  that  are  not to be  reinsured  under  this
     Agreement,  although  it  shall  not  be  necessary  to  indicate  to  what
     reinsurer(s) such classes of business are to be ceded.

                               Automatic Coverage

2.   Except as specified in Paragraph 4 of this  Article,  whenever  coverage is
     available  under this  Agreement,  the Company shall cede and the Reinsurer
     shall  automatically  accept its specified  share of the risk as defined in
     Paragraph 1 of this Article.

                           Special Automatic Coverage

3.   Even though the Company may already be on the risk for its maximum limit of
     retention under policies  previously  issued and therefore unable to retain
     any part of the  insurance  currently  applied for,  the  Company,  without
     retaining any more for its own account,  shall still have the right to cede
     automatically the full amount of new insurance to the Reinsurer, within the
     limits  specified  in  Paragraph  4, below,  on the same terms on which the
     Company  would be willing to accept the risk for its own  account if it did
     not already have its maximum limit of retention.

                        Exceptions to Automatic Coverage

4.   Reinsurance shall not be ceded automatically on any life if:

     a.)  the amount of life  insurance  in force on that life in all  companies
          plus the amount  currently  being  applied for, less the amount of all
          policies  absolutely  assigned to the Company (provided the sum of all
          such  absolute  assignments  does not exceed ten  million  dollars for
          issue age of lives up to age 70 and five million dollars for issue age
          of lives at or over age 70) exceeds ten million dollars  ($10,000,000)
          for  issue  age  of  lives  up to  age 70  and  five  million  dollars
          ($5,000,000) for issue age of lives at or over age 70; or

     b.)  if the amount of insurance  currently  applied for and to be reinsured
          under this Agreement on that life, plus all amounts of insurance which
          the Company then  reinsures  on that life under this  Agreement or any

                                       4


<PAGE>

          other  life  reinsurance  agreement,   exceed  the  Automatic  Binding
          Capacity, as indicated in Exhibit I; or

     c.)  the substandard  mortality  rating assessed by the Company to the risk
          exceeds class P (500%) or its equivalent on an extra premium basis; or

     d.)  the  Company  has  submitted  the risk for  facultative  consideration
          within the last two years.

                             Facultative Reinsurance

5.   When reinsurance is not available as automatic reinsurance under Article I,
     the Company may submit for  facultative  consideration  to the  Reinsurer a
     request for any amount of reinsurance that the Company may require.

     When the  Company  desires  facultative  reinsurance,  it will  send to the
     Reinsurer  any  and  all  information  it has  about  the  risk,  including
     specifically  but  not  limited  to  copies  of  the  application,  medical
     examiners' reports,  attending physicians' statements,  inspection reports,
     and other papers bearing on the  insurability  of the risk. Upon receipt of
     the  information,  the Reinsurer will analyze the risk promptly and as soon
     as possible  notify the Company of its decision and its  classification  of
     the risk.


                                       5

<PAGE>

                                   ARTICLE II

                             Notification of Cession

1.   At the beginning of each quarter, the Company shall notify the Reinsurer of
     all risks ceded under this  Agreement  on which it has received the initial
     premium since the last quarterly notification.

                                  Policy Forms

2.   Upon  request,  the  Company  shall file with the  Reinsurer  copies of all
     policy forms.

                       Notification of Underwriting Rules

3.   Prior to their introduction,  the Company shall notify the Reinsurer of the
     introduction  of new  underwriting  programs  to be  reinsured  under  this
     Agreement or of modification to programs already covered by the Agreement.


                                       6


<PAGE>



                                   ARTICLE III

                    Commencement and Termination of Liability

l.   The  liability  of  the  Reinsurer   under  this  Agreement  for  automatic
     reinsurance  shall  commence  simultaneously  with  the  beginning  of  the
     Company's liability under its corresponding insurance.

2.   The  liability  of the  Reinsurer  under  this  Agreement  for  facultative
     reinsurance  shall  commence  simultaneously  with  the  beginning  of  the
     Company's  liability  under its  corresponding  insurance,  subject  to the
     Reinsurer's  having  given the  Company an  unconditional  approval  on the
     application for reinsurance.

3.   In no event shall the Reinsurer's  liability for reinsurance continue after
     termination of the Company's liability under its corresponding insurance.


                                       7


<PAGE>



                                   ARTICLE IV

                          Oversights - Clerical Errors

1.   Should the Company fail to cede reinsurance that otherwise should have been
     ceded on an automatic basis, or should the Company or the Reinsurer fail to
     comply with any of the other terms of this Agreement,  and if this is shown
     to be  unintentional  and the result of a  misunderstanding,  oversight  or
     clerical  error on the part of either the  Company or the  Reinsurer,  then
     this Agreement  shall not be deemed  abrogated  thereby,  but all companies
     shall be  restored to the  position  they would have  occupied  had no such
     misunderstanding, oversight or clerical error occurred.


                                       8


<PAGE>


                                    ARTICLE V

                               Plan of Reinsurance

1.   Reinsurance  ceded  under  this  Agreement  shall  be on a basis  which  is
     commonly known as Coinsurance.  The Reinsurer shall be liable for its share
     of reserves, including any deficiency reserves, and death claims.

2.   Reinsurance shall be subject to the same terms and conditions as the policy
     issued by the Company to the insured.

3.   The  reinsurance  shall  be in force  for the  amount  determined  from the
     reinsurance cession, provided the Company's policy is in force.


                                       9

<PAGE>

                                   ARTICLE VI

                              Reinsurance Premiums

                                  Life Premiums

1.   The reinsurance  premiums shall be the premiums,  excluding the policy fee,
     which the Company  charges its  insureds,  less the  appropriate  allowance
     given in the attached  Exhibit II. The  Reinsurer  shall receive a share of
     the Reinsurance  premium  equivalent to the  Reinsurer's  share of the face
     amount. The flat extra is considered part of the reinsurance  premium which
     has separate allowances described in paragraphs 2 and 3 of this Article.

2.   Risks Bearing Permanent Flat Extras for More than Five Years

     The total reinsurance premiums for such risks shall be at rates provided in
     Paragraph 1 of this Article plus the following percentage of the flat extra
     premium  charged  by the  Company  under the  original  policy for the face
     amount reinsured.

                                    First Year       25%
                                    Renewal Year     90%

     Risks Bearing Temporary Flat Extras for Five Years or Less

3.   The  total  reinsurance  premiums  for such  risks  shall  be at the  rates
     provided in Paragraph 1 of this Article plus the  following  percentage  of
     the temporary flat extras premium charged under the original policy for the
     face amount reinsured.

                                    First Year       90%
                                    Renewal Year     90%


                                       10

<PAGE>

                                   ARTICLE VII

                               Premium Tax Credits

1.   The  reinsurance  allowances  applicable  under  this  Agreement  take into
     consideration the Company's liability for premium taxes.  Accordingly,  the
     Reinsurer shall make no separate  reimbursement  to the Company for premium
     taxes on the portion of the  Company's  premium  paid to the  Reinsurer  as
     reinsurance premiums.

                                     DAC Tax

2.   The Company and the  Reinsurer  hereby agree to the  following  pursuant to
     Section  1.848-2(g)(8) of the Income Tax Regulations  issued December 1992,
     under Section 848 of the Internal  Revenue Code of 1986,  as amended.  This
     election  shall be effective for all taxable years for which this Agreement
     remains in effect  unless such  election is  terminated  by mutual  written
     agreement  of the parties  hereto with the  consent,  if  required,  of the
     Commissioner of the Internal Revenue Service.

     a.)  The term "party" will refer to either the Company or the  Reinsurer as
          appropriate.

     b.)  The terms used in this  Article are defined by  reference  to Treasury
          Regulation Section 1.848-2 in effect as of December 29, 1992. The term
          "net  consideration" will refer to either net consideration as defined
          in Treasury  Regulation  Section 1.848-2(f) or; gross premium or other
          consideration" as defined in Treasury Regulation Section 1.848-3(b) as
          appropriate.

     c.)  The party with the positive net  consideration  for this Agreement for
          each  taxable  year  will  capitalize   specified  policy  acquisition
          expenses with respect to this Agreement  without regard to the general
          deductions limitation of Section 848(c)(l).

     d.)  Both parties agree to exchange information pertaining to the amount of
          net consideration under this Agreement each year to ensure consistency
          or as otherwise required by the Internal Revenue Service.

     e.)  The Company  will submit a schedule  to the  Reinsurer  by May of each
          year of its  calculation  of the net  consideration  for the preceding
          calendar year. This schedule of calculations  will be accompanied by a
          statement signed by an officer of the Company stating that the Company
          will report such net consideration in its tax return for the preceding
          calendar year.


                                       11

<PAGE>

     f.)  The Reinsurer may contest such calculation by providing an alternative
          calculation  to the Company in writing  within thirty (30) days of the
          Reinsurer's  receipt of the  Company's  calculation.  If the Reinsurer
          does not so notify the  Company,  the  Reinsurer  will  report the net
          consideration  as  determined  by the Company in the  Reinsurer's  tax
          return for the previous year.

     g.)  If the  Reinsurer  contests  the  Company's  calculation  of  the  net
          consideration, the parties will act in good faith to each an agreement
          as to the  correct  amount  within  thirty  (30)  days of the date the
          Reinsurer submits its alternative calculation.  If the Company and the
          Reinsurer  reach  agreement  on an amount of net  consideration,  each
          party shall report such amount in their respective tax returns for the
          previous calendar year.


                                       12

<PAGE>

                                  ARTICLE VIII

                           Reinsurance Administration

     1.   Reinsurance   ceded   under   this   Agreement   shall  be   Bordereau
          Administration.

          a.   The  Reinsurer  shall  have  the  responsibility  of  maintaining
               adequate records for the  administration of the reinsurance ceded
               hereunder.

          b.   Reinsurance premiums shall be paid on an annual basis in advance,
               but if a reinsured  policy is terminated or reduced in accordance
               with the provisions of this Agreement, the Reinsurer shall refund
               the Company the unearned portion of the reinsurance premium.

          c.   Reinsurance  premiums and adjustments  shall be accounted for and
               settled  monthly  for  facultative  business  and  quarterly  for
               automatic  business.   Within  forty-five  (45)  days  after  the
               beginning of each calendar month or quarter,  the Reinsurer shall
               calculate a statement of premiums for all outstanding reinsurance
               falling due within the previous  month or quarter.  The statement
               shall also include  adjustments  in  Reinsurance  premiums due in
               previous billing cycles. The Company shall remit to the Reinsurer
               the amount of any net balance due. If the net balance is in favor
               of the Company, the Reinsurer shall remit to the Company.  Except
               as provided in Article  IV, the payment of  reinsurance  premiums
               shall be a condition  precedent to the liability of the Reinsurer
               under reinsurance covered by this Agreement.  In the event of the
               non-payment   of   reinsurance   premiums  as  provided  in  this
               paragraph,  the  Reinsurer  shall have the right to terminate the
               reinsurance  under all policies  having  reinsurance  premiums in
               arrears by giving a thirty days notice of termination in writing.

               As of the close of this  thirty  day  period,  if the  delinquent
               premium remains unpaid, the Reinsurer's  liability will terminate
               for the risks  described in the preceding  sentence and the risks
               where the  reinsurance  premiums  become  delinquent  during  the
               thirty  day  period.   Policies  on  which  reinsurance  premiums
               subsequently fall due will automatically terminate if reinsurance
               premiums  are not paid when due as  provided  in this  paragraph.
               Regardless of these terminations, the Company will continue to be
               liable  to  the  Reinsurer  for  all  earned  unpaid  reinsurance
               premiums.

               The Company may reinstate the terminated  risks within sixty days
               after the effective  date of termination by paying the delinquent
               reinsurance  premiums  for  the  risks  in  force  prior  to  the
               termination.  However,  the Reinsurer  will not be liable for any
               claim   incurred   between   the   dates   of   termination   and
               reinstatement.


                                       13


<PAGE>



               The effective date of reinstatement  will be the day the required
               back premiums are received by the Reinsurer.

          d.   In  addition  to the  premium  accounting  described  above,  the
               Reinsurer  will  create  appropriate   reports  on  new  business
               reserves, terminations and changes, policy exhibits and an annual
               inforce listing.


                                       14

<PAGE>

                                   ARTICLE IX

                                   Reductions

1.   If all or any part of any insurance  policy  reinsured under this Agreement
     shall be reduced or terminated,  the amount of  reinsurance  carried by the
     Reinsurer with respect to that policy shall be reduced proportionally as of
     the date and time of such  reduction or  termination.  In no case shall the
     company be required to assume a risk for an amount in excess of its regular
     retention  limit for the age at issue and  mortality  rating of the  policy
     under which reinsurance is being reduced or terminated.


                                       15


<PAGE>

                                    ARTICLE X

                      Retention Limit Increases (Recapture)

1.   If the Company increases its limit of retention, a proportionate  reduction
     may be made at the option of the Company in the reinsurance in force on all
     lives on which the Company had its maximum  limit of  retention at the time
     reinsurance was ceded.  However,  no risk shall be recaptured  prior to the
     tenth (10th) anniversary of the original reinsurance of the risk.

2.   Recapture shall be effected as follows:

     a.   After the retention increase is effected, the Company shall notify the
          Reinsurer of its  intention to recapture  within ninety (90) days from
          the effective date of such recapture.

     b.   Each  eligible   policy  shall  be  recaptured  on  the  first  policy
          anniversary on or next following the effective date of recapture.

     c.   All eligible policies shall be recaptured unless there is an agreement
          to the contrary mutually expressed in writing.

     d.   If the  Company  has  reinsured  any  portion of the policy in another
          company, the reduction in reinsurance ceded under this Agreement shall
          be in the same proportion to the total reduction in reinsurance as the
          amount  reinsured under this Agreement bears to the total  reinsurance
          on the policy.

     e.   In determining the new retention for a particular class, the rules for
          the  classification  at time of issue which may  include,  but are not
          limited to, age and rating at issue, shall be used.

     f.   The recaptured  amounts must be retained by the ceding company without
          benefit of reinsurance from some other source.


                                       16

<PAGE>

                                   ARTICLE XI

                         Extended and Paid-Up Insurance

1.   Should a reinsured  policy  lapse and  extended or paid-up  insurance be in
     force in  accordance  with the  provisions  of the  policy,  the  amount of
     reinsurance shall be adjusted.  For any resulting  adjustment in the amount
     of insurance, a corresponding adjustment of reinsurance shall be made.


                                       17

<PAGE>

                                   ARTICLE XII

                                 Reinstatements

1.   Should a lapsed insurance policy be reinstated in accordance with its terms
     and the rules of the Company,  the  reinsurance  under such policy shall be
     reinstated  automatically.  Premiums and interest on reinstated reinsurance
     shall be payable only to the extent that the Company collects  premiums and
     interest on such insurance.


                                       18

<PAGE>

                                  ARTICLE XIII

                                 Policy Changes

1.   Should  the  Company  make  any  material  changes  in the  provisions  and
     conditions  of a policy  issued to an insured  and upon  which  reinsurance
     shall have been granted hereunder,  the Company shall,  within a reasonable
     time, inform the Reinsurer of such change.

2.   Should  a  policy  reinsured  under  this  Agreement  be  exchanged  for or
     converted  to a new  policy  of  the  Company,  the  new  policy  shall  be
     considered as a continuation of the original policy if any of the following
     conditions exist:

     a.)  full new evidence of insurability,  commensurate with the full current
          amount of insurance, is not secured;

     b.)  full new suicide and contestability  periods,  commensurate with those
          used for normal newly issued policies, are not employed;

     c.)  a commission  lower than that normally paid for new issues of the plan
          of insurance on the new policy is paid.

If such policy is so construed as a  continuation  of the original  policy,  the
full amount of reinsurance on the original  policy shall be continued on the new
policy.   Except  as  specifically   provided  in  Exhibit  IV,   point-in-scale
reinsurance  rates measured from the effective date of the original policy would
be payable by the  Company.  The  recapture  period  applicable  to the original
policy would govern the reissued  policy and duration would be measured from the
effective date of the original policy.


                                       19

<PAGE>

                                   ARTICLE XIV

                              Settlement of Claims

1.   In the case of a claim on a reinsured policy, whether claim payment is made
     under the strict policy conditions or compromised for a lesser amount,  the
     settlement  made by the Company shall be  unconditionally  binding upon the
     Reinsurer. The Company shall keep the Reinsurer informed of any claim which
     might be contested or  compromised  or where  unusual  claim  investigation
     expenses are  contemplated  and, where  practical,  the Company may consult
     with the  Reinsurer.  However,  such  consultation  shall  not  impair  the
     Company's  freedom  to  determine  the  proper  action on the claim and the
     settlement  made by the Company shall still be  unconditionally  binding on
     the Reinsurer.

2.   The Company shall furnish the Reinsurer with copies of the proofs of claim.
     If the Reinsurer so requests,  the Company shall furnish the Reinsurer with
     any  information  the  Company may  possess in  connection  with the claim.
     Payment in settlement of the reinsurance under a claim approved and paid by
     the Company for a life reinsured  hereunder  shall be made by the Reinsurer
     upon the receipt of the claim  papers.  If the total  amount  reinsured  is
     $500,000 or more,  and if the Company so requests,  then the amount due for
     that claim will become  payable as soon as the company  approves  the claim
     and notifies the Reinsurer.

3.   The Reinsurer shall share in the claim expense of any contest or compromise
     of a claim in the same proportion  that the risk reinsured  hereunder bears
     to the total risk of the Company on all  policies  being  contested  by the
     Company and shall share in the total  amount of any  reduction in liability
     in the same proportion. Claim expense shall include, but not be limited to,
     cost of  investigation,  legal  fees,  court  costs and  interest  charges.
     Compensation  of officers and employees and any possible extra  contractual
     damages,  except as provided in paragraph 6 of this  Article,  shall not be
     considered claim expenses.

4.   In the event of an increase  or  reduction  in the amount of the  Company's
     insurance on any policy reinsured  hereunder because of an overstatement or
     understatement  of age or misstatement of sex,  established after the death
     of the insured,  the Company and the Reinsurer shall share in such increase
     or reduction  in  proportion  to their  respective  net amounts  under such
     policy.

5.   If the Company  decides to contest a claim,  the Reinsurer may pay its full
     share,  as if the claim were not  contested,  to the  Company and this will
     fulfill the Reinsurer's  obligation for that claim.  However, the Reinsurer
     may, at its option after consultation with the Company, join in the contest
     and  then  share  in the  expenses  of the  contest  and any  reduction  in
     liability,  as specified in  paragraph 3 of this  Article,  with respect to
     this  claim.  The  Reinsurer  will be deemed to have  joined in the contest
     unless it  notifies  the  Company of its  intentions  not to join within 48
     hours of  receiving  written  notification  of the  Company's  intention to
     contest.


                                       20

<PAGE>

6.a. If the Reinsurer  joins in the contest,  the  Reinsurer  shall share in the
     claim  expense  of the  contest  or  compromise  of a  claim  in  the  same
     proportion that the risk reinsured hereunder bears to the total risk of the
     Company on all policies  being  contested by the Company and shall share in
     the total amount of any  reduction  in  liability  in the same  proportion.
     Claim expense shall include,  but not be limited to, cost of investigation,
     legal fees, court costs and interest  charges.  Compensation of salaries of
     officers and employees and any possible extra contractual  damages,  except
     as provided in paragraph 6 of this Article  shall not be  considered  claim
     expenses.

b.   Subject to the  provision  of  Paragraphs  c and d of this Article XIV, the
     Reinsurer shall  reimburse the Company for its share of any  noncontractual
     damages (including, but not limited to, punitive,  exemplary,  compensatory
     or  consequential  damages)  assessed  against the  Company,  provided  the
     conditions  precedent to liability for noncontractual  damages as specified
     in paragraph d of this Article, are met.

c.   The Reinsurer shall not be liable for any portion of noncontractual damages
     assessed on the basis of fault or  wrongdoing  on the part of the  Company,
     its agents or  representatives  other than for  denying or  contesting  the
     claim.

d.   Notwithstanding  the provisions of Paragraphs b and c, the Reinsurer  shall
     participate in noncontractual  damages assessed against the Company only in
     those  cases where it is clear that the denial or  contesting  of the claim
     was the  sole  basis  for  the  award  or  whenever  the  total  amount  of
     contractual claims and noncontractual  damages is equal to or less than the
     face amount of the policy.

e.   The Reinsurer  shall  proportionately  share in any assessment of Statutory
     Penalties (herein defined as those amounts awarded as a penalty,  but fixed
     in amount by statute).

                        Conditions Precedent to Liability

f.   Conditions  precedent  to  liability  for  noncontractual  damages  are  as
     follows:

     1.   The Reinsurer  shall have had the  opportunity  to review the complete
          claim file prior to any final action by the Company that  indicates to
          the claimant that the claim is being denied or contested; and

     2.   Upon  completion of such review,  the  Reinsurer  shall have agreed in
          writing that the claim should be denied or contested.


                                       21

<PAGE>

                                Covered Expenses

g.   Legal fees  incurred in defense  against  noncontractual  damages  shall be
     covered  expenses.  The  Reinsurer  shall  reimburse  the  Company for such
     expenses in the same proportion as described in Paragraph 6a.


                                       22

<PAGE>

                                   ARTICLE XV

                                    Records

1.   The  Reinsurer  shall  have the right at all  reasonable  times and for any
     reasonable  purpose to inspect at the Home  Office of the Company all books
     and documents relating to this reinsurance.


                                   ARTICLE XVI

                                   Insolvency

1.   In the event of the insolvency of the Company, all reinsurance made, ceded,
     renewed or  otherwise  becoming  effective  under this  Agreement  shall be
     payable by the  Reinsurer  directly to the Company or to their  liquidator,
     receiver  or  statutory  successor  on the  basis of the  liability  of the
     Company  under the contract  reinsured  without  diminution  because of the
     insolvency of the Company. It is understood,  however, that in the event of
     the  insolvency  of the Company,  the  liquidator  or receiver or statutory
     successor  of the  insolvent  Company  shall  give  written  notice  of the
     pendency of a claim  against the Company on the policy  reinsured  within a
     reasonable time after such claim is filed in the insolvency  proceeding and
     that during the pendency of such claim that the Reinsurer  may  investigate
     such claim and interpose,  at its own expense, in the proceeding where such
     claim is to be  adjudicated  any  defense or  defenses  which they may deem
     available  to the  Company  or its  liquidator  or  receiver  or  statutory
     successor.

2.   It is further  understood  that the expense thus  incurred by the Reinsurer
     shall be chargeable, subject to court approval, against the Company as part
     of the expense of liquidation to the extent of a proportionate share of the
     benefit  which may accrue to the Company  solely as a result of the defense
     undertaken  by the  Reinsurer.  Where  two or more  assuming  insurers  are
     involved in the same claim and a majority in  interest  elect to  interpose
     defense to such claim,  the expense shall be apportioned in accordance with
     the terms of the  Reinsurance  Agreement  as though  such  expense had been
     incurred by the Company.

3.   In the insolvency of the Reinsurer,  all Reinsurance made, assumed, renewed
     or otherwise  becoming  effective  under this Agreement shall be payable by
     the Reinsurer or by its liquidator, receiver, or statutory successor on the
     basis of the liability of the Reinsurer, directly to the Company, under the
     contract  reinsured  without  diminution  because of the  insolvency of the
     Reinsurer.  In the event of such  insolvency,  the  Company  shall have the
     right to offset the payment of  reinsurance  premiums to such  Reinsurer by
     such Reinsurer's share of claims and related expenses as defined in Article
     XIV.


                                       23

<PAGE>

                                  ARTICLE XVII

                                   Arbitration

1.   In the event of any difference arising hereafter between the parties hereto
     with reference to any transaction  under this Agreement,  the same shall be
     referred  to three  arbitrators  who  must be  executive  officers  of life
     insurance or life reinsurance  companies other than the two parties to this
     Agreement  or their  affiliates,  each of the Company and the  Reinsurer to
     appoint  one of the  arbitrators  and such two  arbitrators  to select  the
     third. If either party refuses or neglects to appoint an arbitrator  within
     thirty (30) days after receipt of the written request for arbitration,  the
     other party may appoint a second arbitrator.

2.   If the two arbitrators fail to agree on the selection of a third arbitrator
     within thirty (30) days of their appointment, each of them shall name three
     individuals,  of whom the other shall decline two and the decision shall be
     made by drawing lots.

3.   The  arbitrators  shall  consider  this  Agreement  not  merely  as a legal
     document but also as a gentlemen's agreement. In resolving the dispute, the
     arbitrators  will give full  consideration  to the customs and practices of
     the life insurance and life reinsurance  industry,  insofar as they are not
     in conflict with the specific terms of this Agreement. They shall decide by
     a majority  vote of the  arbitrators.  There  shall be no appeal from their
     written decision.

4.   Each party shall bear the  expense of its own  arbitration,  including  its
     arbitrator  and outside  attorney  fees, and shall jointly and equally bear
     with the other party the  expense of the third  arbitrator.  Any  remaining
     costs of the arbitration shall be apportioned by the arbitrators.

5.   Arbitration will be governed under the laws of the State of New York.


                                       24

<PAGE>

                                  ARTICLE XVIII

                              Parties to Agreement

1.   This is an  Agreement  solely  between the Company and the  Reinsurer.  The
     acceptance  of  reinsurance  hereunder  shall not create any right or legal
     relation whatever between the Company and the Reinsurer.  The acceptance of
     reinsurance hereunder shall not create any right or legal relation whatever
     between the Reinsurer and the original insureds or the beneficiaries  under
     any policies of the Company which may be reinsured hereunder.


                                       25

<PAGE>

                                   ARTICLE XIX

                              Duration of Agreement

1.   This  Agreement  shall be unlimited as to its duration but may be cancelled
     at any  time  insofar  as it  pertains  to  the  handling  of new  business
     thereafter by the Company or the Reinsurer,  giving ninety (90) days notice
     of  cancellation  in  writing.  The  Reinsurer  shall  continue  to  accept
     reinsurance in accordance  with this  Agreement  during the ninety (90) day
     period aforesaid.  The reinsurance under this Agreement shall be maintained
     in force as long as such  policies  shall  remain in force and  reinsurance
     premiums are paid when due, except as provided in Articles IX and X.


                                       26

<PAGE>

                                   ARTICLE XX

                                Entire Agreement

1.   This Agreement shall  constitute the entire  Agreement  between the parties
     with respect to business reinsured  hereunder.  There are no understandings
     between the  parties  other than as  expressed  in this  Agreement  and any
     future change or  modifications  to this  Agreement  shall be null and void
     unless made by amendment to this Agreement and signed by both parties.


                                       27

<PAGE>


IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
in duplicate by their duly authorized representatives:

Security-Connecticut Life Insurance Company

By:     /s/  William Casill
        -----------------------------------------------
Title   Vice President and Actuary


Attest:

        By:    /s/  Peter V. Susi
              -----------------------------------------
        Title A.V.P. and Assoc. Actuary
              -----------------------------------------


Lincoln Security Life Insurance Company

By:     /s/  J. Paul Chhabra
        -----------------------------------------------
                    Vice President and Actuary


Attest:

        By:    /s/
               -----------------------------------------------
        Title  V.P. Underwriting


                                       28

<PAGE>




                                    EXHIBIT I

                            Maximum Retention Limits

Life:
              Rating                        Ages 0-69      Ages 70 and Over
              Standard                       $100,000          $50,000
              TBL 1-4                        $100,000          $50,000
              TBL 5-16                        $50,000          $50,000



                            Automatic Binding Limits

Life:
              Rating                      Ages 0-69        Ages 70 and Over
              ------                      ---------        ----------------
              Standard                   $5,000,000           $2,500,000
              TBL 1-4                    $5,000,000           $2,500,000
              TBL 5-16                   $2,500,000           $2,500,000


                                       29

<PAGE>

                         REINSURANCE PREMIUM ALLOWANCES










                                   EXHIBIT II


                                       30

<PAGE>

                                   ALLOWANCES


             Securi-T-5
             First year                      100%
           Renewal years                      34%

            Securi-T-10
             First year                      100%
           Renewal years                      28%

            Lifeline-10
             First year                      100%
           Renewal years                      30%

            Lifeline-15
             First year                      100%
           Renewal years                      32%


                                       31

<PAGE>

                           ELIGIBLE PLANS OF INSURANCE


        Plan Name                 Plan Type                  Date Added

        Securi-T-5                Term                       January 15, 1996
        Securi-T-10               Term                       January 15, 1996
        Lifeline-10               Term                       January 15, 1996
        Lifeline-15               Term                       January 15, 1996




                                   EXHIBIT III



                                       32

<PAGE>
           TERMS FOR SPECIFIC POLICY REPLACEMENT & EXCHANGE SITUATION

I.   Term Conversions, Term to Permanent Exchange

     A.   If the  conversion,  replacement  or exchange  occurs before the fifth
          anniversary of the original  policy,  use the YRT rates  effective the
          date of the  original  issue,  shown in Exhibit II of the  Reinsurance
          Agreement  effective  July 1,  1989 for the age at  issue  for the new
          policy plus the following first year single premium:

                            Age                        Single Premium per $1000

                            Under 40                           $ .50
                            40 to 49                            1.00
                            50+                                 3.00

     B.   If the conversion  occurs after the fifth  anniversary of the original
          policy,  use the  reinsurance  rates described in paragraph I.A., on a
          point-in-scale  basis,  that  is,  based  upon the age at issue of the
          original policy and attained  duration,  with only fifty (50%) percent
          of the rate payable in the year following the reissue.

     II.  Exchange to Term

     A.   If full new  evidence  of  insurability  is secured,  use  reinsurance
          allowances in Exhibit II on a new issue basis, that is, based upon age
          at issue of the new policy.

     B.   If full new evidence of insurability  is not secured,  use reinsurance
          allowances  in Exhibit II on a  point-in-scale  basis,  that is, based
          upon age at issue of the original policy and attained duration.




                                   EXHIBIT IV

 <PAGE>

Lincoln Security-Life Insurance Company                  Rates Effective 1/15/96

                                  Form 11200NY


                                       33

<PAGE>

                                  AMENDMENT I

                              Effective May 1, 1996

Amendment to the Automatic  Reinsurance  Agreement  (effective January 15, 1996)
between Lincoln Security Life Insurance Company,  hereinafter referred to as the
"Company", and Security-Connecticut Life Insurance Company, hereinafter referred
to as the "Reinsurer".

It is hereby agreed that on and after the first day of May 1996, under the above
mentioned reinsurance agreement, Article I, paragraph 4, will be replaced with
the following:


                        Exceptions to Automatic Coverage

4.   Reinsurance  shall not be ceded  automatically  on any policy issued on and
     after April 1, 1996, if:

     a.   the amount of life  insurance  in force on that life in all  companies
          plus the amount currently applied for, less the amount of all policies
          absolutely  assigned  to the  Company  (provided  the sum of all  such
          absolute  assignments does not exceed twenty million dollars for issue
          age of lives up to age 70 and ten  million  dollars  for  issue age of
          lives at or over age 70) exceeds twenty million dollars  ($20,000,000)
          for  issue  age  of  lives  up to  age  70  and  ten  million  dollars
          ($10,000,000) for issue age of lives at or over age 70; or

     b.   if the amount of insurance  currently  applied for and to be reinsured
          under this Agreement on that life, plus all amounts of insurance which
          the Company then  reinsures  on that life under this  Agreement on any
          other  life  reinsurance  agreement,   exceed  the  Automatic  Binding
          Capacity, as indicated on Exhibit I; or

     c.   the substandard  mortality  rating assessed by the Company to the risk
          exceeds Class P (500%) or its equivalent on an extra premium basis; or

     d.   the  Company  has  submitted  the risk for  facultative  consideration
          within the last two years.


                                       1

<PAGE>

Except  as herein  specified,  all the terms  and  conditions  of the  Automatic
Reinsurance Agreement shall apply, and this amendment is to be added to and made
part of the aforesaid Agreement.

Security-Connecticut Life Insurance Company

By:            /s/  William Casill
               -------------------------------------------------------
                    William J. Casill

Title               Vice President and Actuary
               -------------------------------------------------------


Attest:

By:            /s/  Peter V. Susi
               -------------------------------------------------------

Title               Assistant Vice President and Assoc. Actuary
               -------------------------------------------------------



Lincoln Security Life Insurance Company

By:            /s/  Barry St. Pierre
               -------------------------------------------------------

Title               Senior Vice President
               -------------------------------------------------------


Attest:

By:            /s/  J. Paul Chhabra
               -------------------------------------------------------

Title               Vice President and Actuary
               -------------------------------------------------------


                                       2

<PAGE>

                                  AMENDMENT II

Effective on or after November 20, 1996, the  Reinsurance  Agreement  (effective
January 15, 1996) between  Security-Connecticut Life Insurance,  herein referred
to as the  "Reinsurer",  and Lincoln  Security Life  Insurance  Company,  herein
referred to as the "Company", shall be amended to include the following:

The Reinsurer  agrees to establish a Trust  Agreement in favor of the Company to
replace the "Letter of Credit" Amendment, effective November 28, 1995. The trust
account will be at least equal to the aggregate of the  statutory  reserves plus
any paid and unpaid losses recoverable from reinsurance assumed by the Reinsurer
from the Company under all such Reinsurance Agreements.

The Trust  Agreement  shall be established in compliance  with Regulation 114 of
the New York  Insurance  Regulations  and  shall  be  subject  to the  following
provisions:

1.   Assets  deposited in the trust account  shall be valued  according to their
     current fair market  value,  and shall  consist only of United States legal
     tender,  certificates of deposit issued by a United States bank and payable
     in United States legal tender,  and  investments of the types  specified in
     paragraphs  (1), (2), (3), (8), and (10) of subsection  (a) of section 1404
     of the New York Insurance Law, provided that such investments are issued by
     an institution that is not the parent,  subsidiary,  or affiliate of either
     the grantor or the beneficiary.

2.   Prior to depositing  assets with the trustee,  the Reinsurer is required to
     execute assignments,  endorsements in blank, or transfer legal title to the
     trustee  of  all  shares,   obligations  or  any  other  assets   requiring
     assignments,  in order that the Company,  or the trustee upon the direction
     of the Company,  may whenever  necessary  negotiate any such assets without
     consent or signature from the Reinsurer or any other entity.

3.   All  settlements  of account  between  the Company  and the  Reinsurer  are
     required to be made in cash or its equivalent.

4.   The Reinsurer  and the Company agree that the assets in the trust  account,
     established pursuant to the provisions of the Reinsurance Agreement, may be
     withdrawn by the Company at any time,  notwithstanding any other provisions
     in the  Reinsurance  Agreement,  and shall be  utilized  and applied by the
     Company or any  successor by  operation  of law of the  Company,  including
     without limitation, any liquidator,  rehabilitator, receiver or conversator
     of the Company, without diminution because of insolvency on the part of the
     Company or the Reinsurer, only for the following purposes:

     a)   to  reimburse  the  Company  for the  Reinsurer's  share  of  premiums
          returned to the owners of  policies  reinsured  under the  Reinsurance
          Agreement on account of cancellations of such policies;


                                       1

<PAGE>
     b)   to reimburse the Company for the  Reinsurer's  share of surrenders and
          benefits on losses paid by the Company  pursuant to the  provisions of
          the policies reinsured under the Reinsurance Agreement;

     c)   to fund an account with the Company in an amount at least equal to the
          deduction,  for reinsurance ceded, from the Company's  liabilities for
          policies reinsured under the Reinsurance Agreement. Such account shall
          include, but not be limited to, amounts for policy reserves,  reserves
          for  claims and  losses  incurred,  loss  adjustments,  expenses,  and
          unearned premiums; and

     d)   to pay  any  other  amounts  the  Company  claims  are due  under  the
          Reinsurance Agreement.

5.   The  Reinsurer  may be given the right to seek approval from the Company to
     withdraw  from the trust  account  all or any part of the assets  contained
     therein and transfer such assets to the Reinsurer, provided:

     a)   The  Reinsurer  shall,  at the time of such  withdrawal,  replace  the
          withdrawn  assets with other  qualified  assets  having a market value
          equal to the market value of the assets withdrawn so as to maintain at
          all times the deposit in the required amount; or

     b)   after such  withdrawals  and  transfer,  the market value of the trust
          account is no less than 102 percent of the required amount.

6.   The  Company  shall  be the  sole  judge  as to  the  application  of  this
     provision,  but shall not unreasonably or arbitrarily withhold its approval
     and provide for:

     a)   the return of any  amount  withdrawn  in excess of the actual  amounts
          required for subparagraphs  (4), (a)-(c) of this Amendment,  or in the
          case of  subparagraph  (4),  (d),  any amounts  that are  subsequently
          determined not to be due; and

     b)   interest  payments  at a rate  not in  excess  of the  prime  rate  of
          interest,  on the amounts held  pursuant to  subparagraph  (4), (c) of
          this Amendment.

7    Any  arbitration  panel or court of competent  jurisdiction  may permit the
     award of:

     a)   interest at a rate different from that provided in  subparagraph  (6),
          (b) of this Amendment;

     b)   court or arbitration costs;


                                       2

<PAGE>

     c)   attorney's fees; and

     d)   any other reasonable expenses.

Except as herein specified, all of the terms and conditions of the existing
Reinsurance Agreements between the Reinsurer and the Company shall continue to
apply, and this Amendment shall be attached to and made part of each such
Reinsurance Agreement.


                                       3

<PAGE>

In witness whereof; the parties hereto have caused this Amendment to be executed
in duplicate by their duly authorized representatives:


Security-Connecticut Life Insurance Company

By:            /s/  William Casill
               -------------------------------------------------------

Title               Vice President and Actuary
               -------------------------------------------------------


Attest:        /s/  Peter V. Susi
               -------------------------------------------------------

Title               Assistant Vice President and Assoc. Actuary
               -------------------------------------------------------



Lincoln Security Life Insurance Company

By:            /s/  Robert Voight
               -------------------------------------------------------

Title               Vice President
               -------------------------------------------------------


Attest:        /s/  John Lockhart
               -------------------------------------------------------

Title               Assistant Controller & Assistant Treasurer
               -------------------------------------------------------


                                       4

<PAGE>

                                  AMENDMENT III

                             Effective June 15, 1997

Amendment to the Automatic  Reinsurance  Agreement  (effective January 15, 1996)
between Lincoln Security Life Insurance Company,  hereinafter referred to as the
"Company", and Security-Connecticut Life Insurance Company, hereinafter referred
to as the "Reinsurer".

It is hereby agreed that on and after the fifteenth day of June 1997,  under the
above mentioned reinsurance agreement, Exhibit II will be amended to include the
attached.

Except  as herein  specified,  all the terms  and  conditions  of the  Automatic
Reinsurance Agreement shall apply, and this amendment is to be added to and made
part of the aforesaid agreement.

Security-Connecticut Life Insurance Company

By:            /s/  William Casill
               -------------------------------------------------------

Title               Vice President and Actuary
               -------------------------------------------------------


Attest:        /s/  Peter V. Susi
               -------------------------------------------------------

Title               Assistant Vice President and Assoc. Actuary
               -------------------------------------------------------



Lincoln Security Life Insurance Company

By:            /s/  Robert Voight
               -------------------------------------------------------

Title               Vice President
               -------------------------------------------------------


Attest:        /s/  John Lockhart
               -------------------------------------------------------

Title               Assistant Controller and Assistant Treasurer
               -------------------------------------------------------


<PAGE>




                         REINSURANCE PREMIUM ALLOWANCES






                                   EXHIBIT II

<PAGE>



                                   ALLOWANCES

SECURI-T 5
   Duration       SPNS     PNS      SNS      PS       SS
   --------       ----     ---      ---      ---      ---
   1              100%     100%     100%     100%     100%
   2+              34%      35%      35%      31%      31%

SECURI-T 10
   Duration       SPNS     PNS      SNS      PS       SS
   --------       ----     ---      ---      ---      ---
   1              100%     100%     100%     100%     100%
   2+              32%      31%      31%      27%      27%

Lifeline 10
   Duration       SPNS     PNS      SNS      PS       SS
   --------       ----     ---      ---      ---      ---
   1              100%     100%     100%     100%     100%
   2+              29%      30%      30%      26%      26%

Lifeline 15
   Duration       SPNS     PNS      SNS      PS       SS
   --------       ----     ---      ---      ---      ---
   1              100%     100%     100%     100%     100%
   2+              31%      32%      32%      29%      29%



Policy Fee:  None.


Recapture:  Reinsurance  ceded  under  the  program  will  not be  eligible  for
            recapture before the tenth anniversary of the reinsured risk.



                                                         Rates Effective 2/18/97


<PAGE>

                                  AMENDMENT IV

                             Effective April 1, 1998


Amendment to the Automatic  Reinsurance  Agreement  (effective January 15, 1996)
between ReliaStar Life Insurance Company of New York, hereinafter referred to as
the "Company"  and  Security-Connecticut  Life  Insurance  Company,  hereinafter
referred to as the "Reinsurer."

It is hereby  agreed that on and after the first of April 1998,  under the above
mentioned  reinsurance  agreement,  Exhibit II will be  amended  to include  the
attached.

Accept  as  herein  specified,   all  terms  and  conditions  of  the  Automatic
Reinsurance Agreement shall apply, and this amendment is to be added to and made
part of the aforesaid agreement.

Accept  as  herein  specified,   all  terms  and  conditions  of  the  Automatic
Reinsurance  Agreement and shall apply,  and the amendment is to be added to and
made part of the aforesaid agreement.



                                Security-Connecticut Life Insurance Company


By:                 /s/  William Casill
                    ------------------------------------------------------------

Title:                   Vice President and Actuary
                    ------------------------------------------------------------

Attest:             /s/  Ava M. Zils
                    ------------------------------------------------------------

Title:                   Reinsurance Officer
                    ------------------------------------------------------------



                                ReliaStar Life Insurance Company of New York

By:                 /s/  Fritz Riemenschneider
                    ------------------------------------------------------------

Title:                   Assistant Vice President and Compliance Officer
                    ------------------------------------------------------------

Attest:             /s/  Kenneth Quenstedt
                    ------------------------------------------------------------

Title:                   Assistant Vice President
                    ------------------------------------------------------------

<PAGE>



                         Reinsurance Premium Allowances
                                   EXHIBIT II



<PAGE>



                                   Allowances

Lifeline 10

           Duration                                  All Underwriting Classes
           --------                                  ------------------------
               1                                                 100%
               2+                                                29%


Lifeline 15

           Duration                                  All Underwriting Classes
           --------                                  ------------------------
               1                                                 100%
               2+                                                29%

Lifeline 20

           Duration                                  All Underwriting Classes
           --------                                  ------------------------
               1                                                 100%
               2+                                                34%

RNY 5

           Duration                                  All Underwriting Classes
           --------                                  ------------------------
               1                                                 100%
               2+                                                35%



Policy fee:  None

Recapture:  Reinsurance  ceded  under  the  program  will  not be  eligible  for
recapture before the tenth anniversary of the reinsured risk.

ReliaStar Life Insurance Company of New York       Rates effective April 1, 1998
                                             Rates modified on February 10, 1998

<PAGE>

                                   AMENDMENT V

                           Effective September 1, 1998

Amendment to the Automatic  Reinsurance  Agreement  (effective January 15, 1996)
between ReliaStar Life Insurance Company of New York, hereinafter referred to as
the "Company",  and  Security-Connecticut  Life Insurance  Company,  hereinafter
referred to as the "Reinsurer".

It is hereby agreed that on and after the first day of September 1998, under the
above  mentioned  reinsurance  agreement,  Exhibit I, will be  amended  with the
attached.

Except  as hereby  specified,  all the terms  and  conditions  of the  Automatic
Reinsurance  Agreement  shall apply,  and the amendment is to be attached to and
made part of the aforesaid Agreement.


                                                 Security-Connecticut
                                                 Life Insurance Company


Attest: /s/ Peter V. Susi         By:            /s/ Ava M. Zils
        -----------------                        -------------------------
Title:  2nd V.P. and Actuary      Title:         Reinsurance Officer
        ---------------------                    -------------------------


                                                 ReliaStar Life Insurance
                                                 Company of New York

Attest: /s/ William Bonneville    By:        /s/ Fritz Riemenschneider
        ----------------------                   -------------------------
Title:  Senior Vice President     Title:         Asst. VP & Compliance Officer
        ----------------------                   -------------------------

<PAGE>

                                    EXHIBIT I

                    RETENTION LIMITS APPLICABLE TO TERM POOL


Underwriting                                 Maximum Retension
-----------                                  -----------------
Program                                            300,000
Individual


               AUTOMATIC BINDING CAPACITY APPLICATION TO TERM POOL


Underwriting                                 Automatic Binding
------------                                 -----------------
Program                                           6,000,000
Individual

<PAGE>

                                  AMENDMENT VI

                             Effective April 1, 2000

Amendment to the Automatic  Reinsurance  Agreement  (effective January 15, 1996)
between ReliaStar Life Insurance Company of New York hereinafter  referred to as
the "Company",  and  Security-Connecticut  Life Insurance  Company,  hereinafter
referred to as the "Reinsurer".

It is hereby  agreed  that on and after the first day of April  2000,  under the
above  mentioned  reinsurance  agreement,  Exhibit II, will be amended  with the
attached.

Except  as hereby  specified,  all the terms  and  conditions  of the  Automatic
Reinsurance  Agreement  shall apply,  and the amendment is to be attached to and
made part of aforesaid Agreement.


                                                Security-Connecticut
                                                Life Insurance Company

Attest:  /s/ Diane Sylvester            By:     /s/ Peter Susi
         -------------------                    --------------------------------
Title:   2nd Vice President             Title:  2nd Vice President and Actuary
         -------------------                    --------------------------------



                                                ReliaStar Life Insurance
                                                Company of New York

Attest:  /s/ William Bonneville         By:     /s/ Fritz Riemenschneider
         ----------------------                 --------------------------------
Title:   Executive Vice President       Title:  Asst. VP & Compliance Officer
         ------------------------               --------------------------------

<PAGE>

                         Reinsurance Premium Allowances

                                   EXHIBIT II

<PAGE>

                                   Allowances

LifeLine 10
         Duration                                    All Underwriting Classes
         --------                                    ------------------------
             1                                                     100%
             2+                                                     14%

LifeLine 15
         Duration                                    All Underwriting Classes
         --------                                    ------------------------
             1                                                     100%
             2+                                                     19%


LifeLine 20
         Duration                                    All Underwriting Classes
         --------                                    ------------------------
             1                                                     100%
             2+                                                     27%


RNY 5
         Duration                                    All Underwriting Classes
         --------                                    ------------------------
             1                                                     100%
             2+                                                     25%



Policy Fee:     None


Recapture:  Reinsurance  ceded  under  the  program  will  not be  eligible  for
            recapture before the tenth anniversary of the reinsured risk.

<PAGE>

                                  AMENDMENT VII

                           Effective November 1, 2001

Amendment to the  Reinsurance  Agreement  (effective  January 15, 1996)  between
ReliaStar Life Insurance  Company of New York,  formally  Lincoln  Security Life
Insurance   Company,   hereinafter   referred   to   as   the   "Company",   and
Security-Connecticut  Life  Insurance  Company,  hereinafter  referred to as the
"Reinsurer".

It is hereby  agreed  that  effective  on and after the first day of November 1,
2001, the above mentioned Reinsurance Agreement is amended as follows:

1.   Article  I,   paragraph  1,  is  clarified  that  Company  may  enter  into
     reinsurance  arrangements  whereby  Company  will  cede  risks  to  certain
     reinsurers  on a first dollar  quota share basis prior to ceding  Company's
     excess retention to Reinsurer.  To the extent Company's  designated maximum
     retention  is exceeded  after  ceding  amounts  under a first  dollar quota
     reinsurance  arrangement,  Reinsurer  shall  accept  amounts  in  excess of
     Company's retention as provided in this Agreement.

2.   The  exceptions to automatic  reinsurance  coverage set forth in Article I,
     paragraph 4, shall not apply to policies  issued on and after the effective
     date of this Amendment.

3.   Exhibit I is amended with the attached.

4.   The  allowances  set forth in Exhibit II is amended to include the attached
     allowances which shall apply to policies issued after the effective date of
     this Amendment.

5.   Exhibit  III is  replaced  by the  attached  Plans  of  Insurance  with the
     appropriate  effective dates. In addition,  it is agreed that all new plans
     of  Company's  term  insurance  shall be eligible  plans of insurance to be
     ceded under this  Reinsurance  Agreement,  unless the  Reinsurer  elects in
     writing not to participate  in the coverage for a newly designed  permanent
     term plan within 20 days after receiving  requisite plan information  which
     Company  must  provide to  Reinsurer  at least 25 days prior to  commencing
     cessions to Reinsurer. Such new plans shall use the appropriate reinsurance
     allowances then being used for new policies reinsured under the Reinsurance
     Agreement,  unless the parties  amend this  Agreement in writing  providing
     another set of reinsurance  allowances to be applicable for the new plan of
     insurance.

<PAGE>

Except  as herein  specified,  all the terms  and  conditions  of the  Automatic
Reinsurance Agreement shall apply, and this amendment is to be added to and made
part of the aforesaid Agreement.


Security-Connecticut Life Insurance Company


By:           /s/  Bruce Loughran
              -------------------------------------------------------


Title:             Second Vice President and Actuary
              -------------------------------------------------------

Attest:
              -------------------------------------------------------


By:           /s/  Eric Swan
              -------------------------------------------------------

Title:             Assistant Actuary
              -------------------------------------------------------


ReliaStar Life Insurance Company of New York


By:           /s/  William Bonneville
              -------------------------------------------------------

Title:             Executive Vice President
              -------------------------------------------------------

Attest:
              -------------------------------------------------------

By:           /s/  Kenneth Quenstedt
              -------------------------------------------------------

Title:             AVP - IS
              -------------------------------------------------------

<PAGE>

                                    EXHIBIT I

                           Effective November 1, 2001


                    RETENTION LIMITS APPLICABLE TO TERM POOL:
                    ----------------------------------------

                                    $300,000


                   AUTOMATIC BINDING APPLICABLE TO TERM POOL:
                   ------------------------------------------

                  Automatic Binding Capacity - Individual Life


  Rating      Ages - 0-75   Rating       Ages - 76-80   Rating      Ages - 81-85
  Standard    50,000,000    Standard     30,000,000     Standard    25,000,000
  Table 1-6   50,000,000    Table 1-4    30,000,000     Table 1-2   25,000,000
  Table 7-16  35,000,000    Table 5-16       0          Table 3-16       0

<PAGE>

                                   EXHIBIT II

                         Reinsurance Premium Allowances


TermSmart NY 5

         Duration                   All Underwriting Classes
         --------                   ------------------------
              1                                100%
              2+                               19%


TermSmart NY 10

         Duration                   All Underwriting Classes
         --------                   ------------------------
              1                                100%
              2+                               14%

TermSmart NY 15

         Duration                   All Underwriting Classes
         --------                   ------------------------
              1                                100%
              2+                               18%

TermSmart NY 20

         Duration                   All Underwriting Classes
         --------                   ------------------------
              1                                100%
              2+                               20%


Policy Fee: None.

Recapture:  Reinsurance  ceded  under  the  program  will  not be  eligible  for
            recapture before the tenth anniversary of the reinsured risk.

<PAGE>

                                   EXHIBIT III

                           ELIGIBLE PLANS OF INSURANCE

             PLAN NAME                PLAN TYPE            DATE ADDED
             ---------                ---------            ----------

          TermSmart NY 5                Term               November 1, 2001
          TermSmart NY 10               Term               November 1, 2001
          TermSmart NY 15               Term               November 1, 2001
          TermSmart NY 20               Term               November 1, 2001

<PAGE>

                                 AMENDMENT VIII

                           Effective September 9, 2002

Amendment to the Automatic  Reinsurance  Agreement,  effective January 15, 1996,
between   ReliaStar  Life  Insurance   Company  of  New  York   (Company),   and
Security-Connecticut Life Insurance Company (Reinsurer).

It is hereby agreed that on and after the ninth day of September 2002, under the
above mentioned reinsurance agreement, Exhibit II, will be amended with the
attached.

Except  as hereby  specified,  all the terms  and  conditions  of the  Automatic
Reinsurance  Agreement  shall apply,  and the amendment is to be attached to and
made part of aforesaid Agreement.


Security-Connecticut Life Insurance Company


By:           /s/  Richard Lau
              -------------------------------------------------------

Title:             Vice President and Actuary
              -------------------------------------------------------

Date:              2/25/04
              -------------------------------------------------------

Attest:       /s/  Mary Broesch
              -------------------------------------------------------

Title              Vice President and Actuary
              -------------------------------------------------------

Date               2/25/04
              -------------------------------------------------------


ReliaStar Life Insurance Company of New York


By:           /s/  Richard Lau
              -------------------------------------------------------

Title:             Vice President and Actuary
              -------------------------------------------------------

Date:              2/25/04
              -------------------------------------------------------

Attest:       /s/  Mary Broesch
              -------------------------------------------------------

Title              Vice President and Actuary
              -------------------------------------------------------

Date               2/25/04
              -------------------------------------------------------

<PAGE>



                         Reinsurance Premium Allowances


                                   EXHIBIT II


<PAGE>


                                   ALLOWANCES
                                September 9, 2002


                                           All Underwriting Classes
  Plan Name                      Duration 1                         Duration 2+
  TermSmart 5                        100%                                15%
  TermSmart 10                       100%                                17%
  TermSmart 15                       100%                                23%
  TermSmart 20                       100%                                23%

  Policy Fee:     None


Recapture:  Reinsurance  ceded  under  the  program  will  not be  eligible  for
            recapture before the tenth anniversary of the reinsured risk.


See enclosed C.D. for rates.


<PAGE>

                                  AMENDMENT IX


                             Effective June 30, 2003


Amendment to the Automatic  Reinsurance  Agreement,  effective January 15, 1996,
between   ReIiaStar  Life  Insurance   Company  of  New  York   (Company),   and
Security-Connecticut Life Insurance Company.

It is hereby agreed that on and after the thirtieth day of June 2003,  under the
above  mentioned  reinsurance  agreement,  Exhibit II, will be amended  with the
attached.

Except  as hereby  specified,  all the terms  and  conditions  of the  Automatic
Reinsurance  Agreement  shall apply,  and the amendment is to be attached to and
made part of aforesaid Agreement.

Security-Connecticut Life Insurance Company


By:           /s/  Richard Lau
              -------------------------------------------------------
                   Richard Lau

Title:             Vice President
              -------------------------------------------------------

Date:              2/25/04
              -------------------------------------------------------

Attest:       /s/  Mary Broesch
              -------------------------------------------------------
                   Mary Broesch

Title              Vice President
              -------------------------------------------------------

Date               2/25/04
              -------------------------------------------------------


ReliaStar Life Insurance Company of New York


By:           /s/  Richard Lau
              -------------------------------------------------------
                   Richard Lau

Title:             Vice President
              -------------------------------------------------------

Date:              2/25/04
              -------------------------------------------------------

Attest:       /s/  Mary Broesch
              -------------------------------------------------------
                   Mary Broesch

Title              Vice President
              -------------------------------------------------------

Date               2/25/04
              -------------------------------------------------------


<PAGE>


                         Reinsurance Premium Allowances


                                   EXHIBIT II

<PAGE>

                                   ALLOWANCES

                                  June 30, 2003


                                    All Underwriting Classes
Plan Name                Duration 1                          Duration 2+
TermSmart 5                 100%                                 15%
TermSmart 10                100%                                 17%
TermSmart 15                100%                                 23%
TermSmart 20                100%                                 23%
TermSmart 30                100%                        See attached Table I


Policy Fee:      None

Recapture:  Reinsurance  ceded  under  the  program  will  not be  eligible  for
            recapture before the tenth anniversary of the reinsured risk.


See enclosed C.D. for rates


<PAGE>

TABLE I

                                 Renewal allowances
Band 1          Issue            Risk Class
Sex             Age              SPNS          PNS     NS          PT      TB
                ---              ----          ---     --          --      --
    Male       18 - 30           21%           22%     23%         23%     23%
    Male       31 - 40           19%           18%     19%         20%     20%
    Male         41+             16%           19%     23%         23%     23%

   Female      18 - 30           17%           17%     18%         18%     18%
   Female      31 - 40           17%           17%     18%         18%     18%
   Female        41+             17%           17%     18%         18%     18%

Band 2          Issue            Risk Class
Sex             Age              SPNS          PNS     NS          PT      TB
                ---              ----          ---     --          --      --
    Male       18 - 30           21%           21%     23%         23%     23%
    Male       31 - 40           18%           17%     18%         20%     20%
    Male         41+             15%           18%     23%         23%     23%

   Female      18 - 30           16%           16%     18%         18%     18%
   Female      31 - 40           16%           16%     18%         18%     18%
   Female        41+             16%           16%     18%         18%     18%

   Band 3       Issue          Risk Class
     Sex        Age             SPNS           PNS     NS          PT      TB
     ---        ---             ----           ---     --          --      --
    Male       18 - 30           18%           18%     22%         35%     35%
    Male       31 - 40           15%           14%     16%         17%     17%
    Male         41+             12%           15%     22%         22%     22%

   Female      18 - 30           13%           13%     16%         16%     16%
   Female      31 - 40           13%           13%     16%         16%     16%
   Female        41+             13%           13%     16%         16%     16%

   Band 4      Issue           Risk Class
     Sex       Age              SPNS           PNS     NS          PT      TB
     ---       ---              ----           ---     --          --      --
    Male       18 - 30           17%           17%     22%         22%     22%
    Male       31 - 40           14%           13%     15%         17%     17%
    Male         41+             12%           14%     22%         22%     22%

   Female      18 - 30           12%           12%     15%         15%     15%
   Female      31 - 40           12%           12%     15%         15%     15%
   Female        41+             12%           12%     15%         15%     15%



<PAGE>


                                   AMENDMENT X

                            Effective October 1, 2003

Amendment X to the Automatic Reinsurance Agreement,  effective January 15, 1996,
between  Security-Connecticut  Life Insurance Company  (Reinsures) and ReliaStar
Life Insurance Company of New York (Company).

Effective October 1, 2003,  Security-Connecticut Life Insurance Company has been
merged with  ReliaStar  Life  Insurance  Company and  thereafter  ReliaStar Life
Insurance  Company  will assume all the  business of  Security-Connecticut  Life
Insurance Company reinsured under the Automatic  Reinsurance Agreement effective
January  15,  1996  between  Security-Connecticut  Life  Insurance  Company  and
ReliaStar Life Insurance Company of New York.

All of the rights accorded to and duties, obligations and liabilities assumed by
Security-Connecticut  Life  Insurance  Company  under  the  Agreement  shall  be
accorded to and assumed by ReliaStar Life Insurance Company as if ReliaStar Life
Insurance  Company  had been the  original  party to the  Reinsurance  Agreement
instead of Security-Connecticut Life Insurance Company.

The terms and  conditions  of the Agreement are not changed in any way except as
stated herein.

Amendment X shall inure to the benefit of and be binding upon the parties hereto
and their respective successors and assigns.

In witness of the above,  ReliaStar  Life and ReliaStar Life of New York have by
their respective  officers  executed and delivered this Amendment X in duplicate
on the dates indicated below, with an Effective Date of October 1, 2003.


RELIASTAR LIFE INSURANCE COMPANY    RELIASTAR LIFE INSURANCE COMPANY OF NEW YORK


By: /s/  Richard Lau                By: /s/  Richard Lau
    ----------------------------        ----------------------------------------
         Richard Lau                         Richard Lau

Title:   Vice President             Title:   Vice President
         --------------                      --------------

Date:    2/25/04                    Date:    2/25/04
         -------                             -------

Attest:  /s/  Mary Broesch          Attest:  /s/  Mary Broesch
         -----------------                   -----------------
              Mary Broesch                        Mary Broesch

Title         Vice President        Title         Vice President
              --------------                      --------------

Date          2/25/04               Date          2/25/04
              -------                             -------


<PAGE>

                                  AMENDMENT XI

                           Effective November 1, 2003

Amendment to the Automatic  Reinsurance  Agreement,  effective January 15, 1996,
between  ReliaStar Life Insurance  Company of New York (Company),  and ReliaStar
Life Insurance Company.

It is hereby agreed that on and after the first day of November 2003,  under the
above  mentioned  reinsurance  agreement,  Exhibit II, will be amended  with the
attached.

Except  as hereby  specified,  all the terms  and  conditions  of the  Automatic
Reinsurance  Agreement  shall apply,  and the amendment is to be attached to and
made part of aforesaid Agreement.

RELIASTAR LIFE INSURANCE COMPANY


By:           /s/  Richard Lau
              -------------------------------------------------------
                   Richard Lau

Title:             Vice President
              -------------------------------------------------------

Date:              2/25/04
              -------------------------------------------------------

Attest:       /s/  Mary Broesch
              -------------------------------------------------------
                   Mary Broesch

Title:             Vice President
              -------------------------------------------------------

Date:              2/25/04
              -------------------------------------------------------


RELIASTAR LIFE INSURANCE COMPANY OF NEW YORK


By:           /s/  Richard Lau
              -------------------------------------------------------
                   Richard Lau

Title:             Vice President
              -------------------------------------------------------

Date:              2/25/04
              -------------------------------------------------------

Attest:       /s/  Mary Broesch
              -------------------------------------------------------
                   Mary Broesch

Title              Vice President
              -------------------------------------------------------

Date               2/25/04
              -------------------------------------------------------


<PAGE>


                         Reinsurance Premium Allowances


                                   EXHIBIT II


<PAGE>



ALLOWANCES
                                November 1, 2003.


                                       All Underwriting Classes
Plan Name                   Duration 1                          Duration 2+
TermSmart 5                    100%                                 14%
TermSmart 10                   100%                                 16%
TermSmart 15                   100%                                 20%
TermSmart 20                   100%                                 21%
TermSmart 30                   100%                        See attached Table I


Policy Fee:      None


Recapture:  Reinsurance  ceded  under  the  program  will  not be  eligible  for
            recapture before the tenth anniversary of the reinsured risk.


<PAGE>



TABLE I

TABLE I

                                 Renewal allowances
Band 1          Issue            Risk Class
Sex             Age              SPNS          PNS     NS          PT      TB
                ---              ----          ---     --          --      --
    Male       18 - 30           21%           22%     23%         23%     23%
    Male       31 - 40           19%           18%     19%         20%     20%
    Male         41+             16%           19%     23%         23%     23%

   Female      18 - 30           17%           17%     18%         18%     18%
   Female      31 - 40           17%           17%     18%         18%     18%
   Female        41+             17%           17%     18%         18%     18%

Band 2          Issue            Risk Class
Sex             Age              SPNS          PNS     NS          PT      TB
                ---              ----          ---     --          --      --
    Male       18 - 30           21%           21%     23%         23%     23%
    Male       31 - 40           18%           17%     18%         20%     20%
    Male         41+             15%           18%     23%         23%     23%

   Female      18 - 30           16%           16%     18%         18%     18%
   Female      31 - 40           16%           16%     18%         18%     18%
   Female        41+             16%           16%     18%         18%     18%

   Band 3       Issue          Risk Class
     Sex        Age             SPNS           PNS     NS          PT      TB
     ---        ---             ----           ---     --          --      --
    Male       18 - 30           18%           18%     22%         35%     35%
    Male       31 - 40           15%           14%     16%         17%     17%
    Male         41+             12%           15%     22%         22%     22%

   Female      18 - 30           13%           13%     16%         16%     16%
   Female      31 - 40           13%           13%     16%         16%     16%
   Female        41+             13%           13%     16%         16%     16%

   Band 4      Issue           Risk Class
     Sex       Age              SPNS           PNS     NS          PT      TB
     ---       ---              ----           ---     --          --      --
    Male       18 - 30           17%           17%     22%         22%     22%
    Male       31 - 40           14%           13%     15%         17%     17%
    Male         41+             12%           14%     22%         22%     22%

   Female      18 - 30           12%           12%     15%         15%     15%
   Female      31 - 40           12%           12%     15%         15%     15%
   Female        41+             12%           12%     15%         15%     15%


<PAGE>

                                  AMENDMENT XII

                              Effective May 1, 2004

Amendment  XII to the Automatic  Reinsurance  Agreement,  effective  January 15,
1996,  between ReliaStar Life Insurance  Company  (Reinsurer) and ReliaStar Life
Insurance Company of New York (Company).

The parties hereby agree to append Exhibit I of the above  referenced  agreement
for new business written on or after May 1, 2004 as follows:

A.   Automatic Binding Limits

                   Aviation* and Professional Sports Risk
                   ------------------------------------------

  Rating         Ages - 0-75      Ages - 76-80     Ages - 81-85
  Standard       $25,000,000       $15,000,000      12,500,000
  Table 1-2      $25,000,000       $15,000,000      12,500,000
  Table 3-4      $25,000,000       $15,000,000           0
  Table 5-6      $25,000,000            0                0
  Table 7-16     $17,000,000            0                0

 *Aviation Exclusion Rider (AER) required for ages under l6 and
  above 75.


The parties  hereby agree to amend Exhibit I of the above  referenced  agreement
for new business written on or after May 1, 2004 as follows:

B.   Jumbo Limit

     As it is known to Company at issue,  the total then  inforce plus the total
     amount applied for, using the largest  scheduled  death benefit applied for
     on the life may not be in excess of $65,000,000 on any one life.

Except as herein  specified,  all the terms and  conditions  of the  Reinsurance
Agreement shall apply, and this Amendment is to be added to and made part of the
aforesaid Agreement.


<PAGE>


In witness of the above,  ReliaStar  Life and ReliaStar Life of New York have by
their respective officers executed and delivered this Amendment XII in duplicate
on the dates indicated below, with an Effective Date of May 1, 2004.

RELIASTAR LIFE INSURANCE COMPANY              RELIASTAR LIFE INSURANCE COMPANY
                                                OF NEW YORK


By:    /s/  Richard Lau                       By:  /s/  Richard Lau
       ------------------------------------        -----------------------------
            Richard Lau                                 Richard Lau

Title:      Vice President                    Title:    Vice President
       ------------------------------------        -----------------------------

Date:       6/17/04                           Date:     6/17/04
       ------------------------------------        -----------------------------

Attest:/s/  Mary Broesch                      Attest:  /s/  Mary Broesch
       ------------------------------------        -----------------------------
            Mary Broesch                                    Mary Broesch

Title       Vice President                    Title         Vice President
       ------------------------------------        -----------------------------

Date        6/17/04                           Date          6/17/04
       ------------------------------------        -----------------------------

<PAGE>

                                 AMENDMENT XIII

                             EFFECTIVE JUNE 14, 2004

                                       To

          AUTOMATIC REINSURANCE AGREEMENT (effective January 15, 1996)

                            This Amendment is between

  RELIASTAR LIFE INSURANCE COMPANY OF NEW YORK, (Company), 1000 Woodbury Road,
                      Suite 208, Woodbury, New York 11797.

                                       and

    RELIASTAR LIFE INSURANCE COMPANY (Company), 20 Washington Avenue, South,
                             Minneapolis, MN 55401.

It is hereby agreed that on and after the fourteenth day of June 2004, under the
above  mentioned  reinsurance  agreement,  Exhibit II, will be amended  with the
attached.

Except  as hereby  specified,  all the terms  and  conditions  of the  Automatic
Reinsurance  Agreement  shall apply,  and the amendment is to be attached to and
made part of aforesaid Agreement.


RELIASTAR LIFE INSURANCE COMPANY              RELIASTAR LIFE INSURANCE COMPANY
  NEW YORK


By:    /s/  Richard Lau                       By:  /s/  Richard Lau
       ------------------------------------        -----------------------------
            Richard Lau                                 Richard Lau

Title:      Vice President & Actuary          Title:    Vice President & Actuary
       ------------------------------------        -----------------------------

Date:       7/15/04                           Date:     7/15/04
       ------------------------------------        -----------------------------

Attest:/s/  Mary Broesch                      Attest:/s/Mary Broesch
       ------------------------------------        -----------------------------
            Mary Broesch                                Mary Broesch

Title       Vice President & Actuary          Title     Vice President & Actuary
       ------------------------------------        -----------------------------

Date        6/17/04                           Date      6/17/04
       ------------------------------------        -----------------------------

<PAGE>


                                   EXHIBIT II


                          PRODUCTS COVERED BY AMENDMENT

                                       AND

                                   ALLOWANCES

                                  June 14, 2004

   PIan Name          Plan            Date        Allowances        Allowances
                      Code            Added       Duration 1        Duration 2+
   TermSmart 10       TSM 107         6/14/04        100%               18%
   TermSmart 15       TSM 157         6/14/04        100%               20%
   TermSmart 20       TSM207          6/14/04        100%             18.5%
   TermSmart 30       TSM307          6/14/04        100%             18.5%


Policy Fee: None

Recapture:Reinsurance ceded under the program will be eligible for recapture as
          follows:  after the fifteenth  anniversary  of the reinsured  risk for
          TermSmart 10 and 15; after the twentieth  anniversary of the reinsured
          risk for  TermSmart  20 and after  the  thirtieth  anniversary  of the
          reinsured risk for TermSmart 30.

See enclosed C.D. for premium rates.

TermSmart 05 premium rates and  allowances  remain  unchanged  from Amendment XI
dated  November  1,  2003.  TermSmart  05 will no longer be  available  for sale
effective July 12, 2004.


<PAGE>

                                                                  Exhibit 10.(n)


                              REINSURANCE AGREEMENT

                          Effective as of April 1, 1984



                                   Between the



                     LINCOLN SECURITY LIFE INSURANCE COMPANY

                   (hereinafter referred to as the "Company")



                                       and



                   SECURITY-CONNECTICUT LIFE INSURANCE COMPANY

                  (hereinafter referred to as the "Reinsurer")



<PAGE>




                         AUTOMATIC REINSURANCE AGREEMENT

                                                                            Page
                                                                            ----

ARTICLE I                  Basis of Reinsurance                               4
                           Automatic Coverage                                 4
                           Special Automatic Coverage                         4
                           Limited Retention                                  4
                           Exceptions to Automatic Coverage                   5
                           Conditional Receipt Coverage                       5
                           Facultative Reinsurance                            5

ARTICLE II                 Notification of Cession                            6
                           Policy Forms                                       6
                           Notification of Underwriting Rules                 6

ARTICLE III                Commencement & Termination of Liability            6

ARTICLE IV                 Oversights - Clerical Errors                       7

ARTICLE V                  Plan of Reinsurance                                7

ARTICLE VI                 Reinsurance Premiums-Life Premiums                 8
                           Permanent Flat Extras                              8
                           Temporary Flat Extras                              9
                           Disability Waiver and Payor Benefits               9
                           Accidental Death Benefits                          9

ARTICLE VII                Tax Credits                                        9

ARTICLE VIII               Reinsurance Administration                        10

ARTICLE IX                 Reductions                                        10

ARTICLE X                  Retention Limit Increases (Recapture)             11

ARTICLE XI                 Extended and Paid-Up Insurance                    11

ARTICLE XII                Reinstatements                                    12

ARTICLE XIII               Policy Changes                                    12

ARTICLE XIV                Settlement of Claims                              12
                           Conditions Precedent to Liability                 14
                           Covered Expenses                                  14

ARTICLE XV                 Records                                           15

ARTICLE XVI                Insolvency                                        15

ARTICLE XVII               Arbitration                                       15



<PAGE>

                    AUTOMATIC REINSURANCE AGREEMENT - cont'd.

                                                                            Page


ARTICLE XVIII              Parties to Agreement                              16

ARTICLE XIX                Duration of Agreement                             16

ARTICLE XX                 Deficiency Reserves                               16




Signature Page                                                               17


Exhibit I                  Maximum Limits of Company Retention and
                           Maximum Limits of Automatic Reinsurance
                           Coverage                                          18

Exhibit II                 Reinsurance Premiums                           19-22

Exhibit III                Plans of Insurance                                23


<PAGE>

                                    ARTICLE I

                              Basis of Reinsurance

1.   On the basis hereinafter stated, the excess over the Company's retention on
     Individual  Ordinary Life  (including  Universal  Life),  Waiver of Premium
     Disability,  and Accidental  Death insurance issued directly by the Company
     to standard and  substandard  lives on any of the  Company's  policy forms,
     shall be reinsured with the Reinsurer  automatically in accordance with the
     Company's  individual ordinary  underwriting rules or shall be submitted to
     the Reinsurer on a facultative basis.

                               Automatic Coverage

2.   Except as specified in Paragraph 5,  whenever  coverage is available  under
     this  Agreement,  as specified in Paragraph 1 of this Article,  the Company
     shall cede and the Reinsurer shall automatically accept the excess over the
     Company's  designated  maximum retention up to the maximum Automatic Limits
     specified in Exhibit I.

                           Special Automatic Coverage

3.   Even though the Company may already be on the risk for its maximum limit of
     retention under policies  previously  issued and therefore unable to retain
     any part of the  insurance  currently  applied for,  the  Company,  without
     retaining any more for its own account,  shall still have the right to cede
     automatically the full amount of new insurance to the Reinsurer, within the
     limits  specified  in  Paragraph  2, above,  on the same terms on which the
     Company  would be willing to accept the risk for its own  account if it did
     not already have its maximum limit of retention.

                                Limited Retention

4.   Whenever  the  Company  retains  less  than  its  scheduled  retention,  as
     specified in Exhibit I, on life insurance  policies  issued directly by the
     Company to standard and  substandard  lives on any of the Company's  policy
     forms,  the automatic  coverage shall be equal to three times the Company's
     retention on the life.


                                       4

<PAGE>



                        Exceptions to Automatic Coverage

5.   Reinsurance shall not be ceded automatically on any life if:

     a)   The amount of Life insurance in force plus the amount  currently being
          applied  for on that life in all  companies  exceeds  Six and One Half
          Million Dollars ($6,500,000); or

     b)   The substandard  mortality  rating assessed by the Company to the risk
          exceeds  Class P (500%) or its  equivalent  on an extra  premium basis
          (for flat extras, each $2.50 equals one table); or

     c)   The insurance is the result of a group  conversion where full evidence
          of insurability has not been secured.


                          Conditional Receipt Coverage

     6.   If the Company  becomes  liable  under a  conditional  receipt  before
          reinsurance  has been  arranged on a risk that clearly would have been
          ceded under this Agreement,  the Reinsurer will  nonetheless be liable
          for the excess over the Company's Conditional Receipt retention limit,
          as  indicated  in Exhibit  I, up to the  maximum  amount of  Automatic
          Reinsurance  Conditional  Receipt  Coverage  specified  in  Exhibit I,
          provided the risk is not excluded from coverage by paragraph 5 of this
          Article.

                             Facultative Reinsurance

     7.   When  reinsurance  is not  available  as Automatic  Reinsurance  under
          Article I, the Company shall submit for facultative  consideration  to
          the Reinsurer a request for any amount of reinsurance that the Company
          may require.

          When the Company desires facultative reinsurance,  it will send to the
          Reinsurer  any and all  information  it has about the risk,  including
          specifically  but not  limited to copies of the  application,  medical
          examiners'  reports,  attending  physicians'  statements,   inspection
          reports,  and other papers  bearing on the  insurability  of the risk.
          Upon receipt of the  information,  the Reinsurer will analyze the risk
          promptly  and as soon as possible  notify the Company of its  decision
          and its classification of the risk.


                                       5

<PAGE>

                                   ARTICLE II

                             Notification of Cession

1.   At the beginning of each quarter, the Company shall notify the Reinsurer of
     all risks ceded under this Agreement since the last quarterly  notification
     on which it has received the initial premium.

                                  Policy Forms

2.   The Company shall file with the Reinsurer copies of all policy forms.

                       Notification of Underwriting Rules

3.   The  Company  will  notify  the  Reinsurer  of  its  existing  underwriting
     programs,  any new underwriting  programs, or any modifications to existing
     or new  programs.  For new  programs or  modifications  of  programs,  such
     notification  shall be sent to the Reinsurer at the earliest  possible date
     but no  later  than  the  date the  announcement  of such  new  program  or
     modification is released to the field force of the Company.

                                   ARTICLE III

                    Commencement and Termination of Liability

1.   The  liability  of  the  Reinsurer   under  this  Agreement  for  automatic
     reinsurance  shall  commence  simultaneously  with  the  beginning  of  the
     Company's liability under its corresponding insurance.

2.   The  liability  of the  Reinsurer  under  this  Agreement  for  facultative
     reinsurance  shall  commence  simultaneously  with  the  beginning  of  the
     company's  liability  under its  corresponding  insurance,  subject  to the
     Reinsurer's  having  given the  Company an  unconditional  approval  on the
     application for reinsurance.

3.   In no event shall the Reinsurer's  liability for reinsurance continue after
     termination of the Company's liability under its corresponding insurance.


                                       6

<PAGE>

                                   ARTICLE IV

                          Oversights - Clerical Errors

1.   Should the Company fail to cede reinsurance that otherwise should have been
     ceded on an Automatic  basis, or fail to comply with any of the other terms
     of this Agreement,  and if this is shown to be unintentional and the result
     of a  misunderstanding,  oversight or clerical  error on the part of either
     the  Company  or the  Reinsurer,  then this  Agreement  shall not be deemed
     abrogated  thereby,  but both companies  shall be re-stored to the position
     they  would  have  occupied  had no  such  misunderstanding,  oversight  or
     clerical error occurred.

                                    ARTICLE V

                               Plan of Reinsurance

1.   Reinsurance  of Life risks shall be on the Yearly  Renewal  Term Plan.  The
     amount at risk for this plan shall be: (a x b) -R, where:

          a is equal to the total  number of units of  coverage  for the  policy
          (each unit generally  provides $1,000 of level face amount,  or $1,000
          initial face amount in the case of policies with varying face amount),
          b is the  face  amount  for the  current  policy  year for one unit of
          coverage,  minus the Special  Reserve for one unit coverage;  and R is
          the Company's retention.

2.   The Special Reserve (tV) per unit at the end of policy year, t, for t equal
     to 10 or less,  is defined for a policy with 10 or more years of premium as
     follows:

          For t = 2 through t = 10 tV = 10 CV - d(l0-t),  where 10CV is the 10th
          Cash Value per unit as defined by the Company's EDP system, and d = 10
          CV / 9 to the lower $. For t = 1, the value of tV is zero.

     If the policy has n years of premiums where n is between 5 and 9 inclusive,
     then tV = n CV - (n-t) d where n CV is the nth Cash Value per unit, and d =
     n CV / (n-I) to the lower $.

3.   The Special  Reserve  for plans with less than 5 years of premiums  and for
     Universal Life will be the Cash Value.


                                       7

<PAGE>


4.   For a policy with 10 or more premiums,  the Special  Reserve per unit after
     the 10th year is equal to the Cash Value per unit to dollars and cents.  If
     there is reinsurance,  the Company's  retention is the original  retention,
     provided  the  insurance  plan does not have a scheduled  increase,  nor an
     increase due to insurance  purchased by  dividends,  nor an increase due to
     recapture.  If the Company's  original retention is increased by recapture,
     the Company's  retention  shall refer to the increased  retention as of the
     effective date of recapture.

5.   Reinsurance  of  Disability  benefits  shall be on a  coinsurance  basis in
     accordance  with the original forms of the Company.  The initial  reinsured
     amount shall be equal to the initial amount of corresponding life insurance
     and the amount of Disability  reinsured shall remain constant.  Reinsurance
     of Accidental  Death  benefits shall be on a YRT basis at the rate given in
     Exhibit II - Part 4.

                                   ARTICLE VI

                              Reinsurance Premiums

                                  Life Premiums

1.   Until further notice,  reinsurance  premiums shall be at the rates given in
     the attached Exhibit II. For the Security-21 product, re-insurance premiums
     shall be at the rates  given in  Exhibit  II--Part  3. For joint  policies,
     reinsurance  premiums  shall be  double  the  rates  given in the  attached
     Exhibit II at the joint equal age of the insureds.  If the amounts required
     for each insured  differ,  the Company shall reinsure the greater amount of
     reinsurance  on the policy.  For those plans  specified in Exhibit III, the
     Reinsurer  guarantees  that premium rates for a given attained age,  rating
     and duration  shall not exceed the higher of the rate shown in the attached
     schedule  (Exhibit II) for that age,  rating and duration or the  Company's
     own gross premium.

     Risks Bearing Permanent Flat Extras for More than Five Years

2.   The total reinsurance premiums for such risks shall be at rates provided in
     Paragraph 1 of this Article plus the following percentage of the flat extra
     premium  charged  by the  Company  under the  original  policy for the face
     amount reinsured.

                                                 First Year            25%
                                                 Renewal Years         90%


                                       8

<PAGE>



              Risks Bearing Temporary Flat Extras for Five Years or Less

3.   The  total  reinsurance  premiums  for such  risks  shall  be at the  rates
     provided in  Paragraph 1 of this  Article  plus 90% of the  temporary  flat
     extra  premium  charged  under  the  original  policy  for the face  amount
     reinsured.


                      Disability Waiver and Payor Benefits

4.   The  premium  to be  charged  by  the  Reinsurer  for  the  reinsurance  of
     Disability  Waiver  benefits  and for Payor  benefits on juvenile  policies
     shall be at the following percentage of the rate charged by the Company for
     the amount reinsured.

                                                 First Year            25%
                                                 Renewal Years         90%

                            Accidental Death Benefits

5.   The  premiums  to be  charged  by the  Reinsurer  for  the  reinsurance  of
     Accidental  Death benefits shall be at the rates given in Exhibit II - Part
     4.

                                   ARTICLE VII

                                   Tax Credits

1.   Except  in those  instances  where  the  Reinsurer  is taxed  directly  and
     independently on premiums  collected by it from the Company,  the Reinsurer
     shall reimburse the Company for taxes on reinsurance  premiums paid to such
     states as do not allow  reinsurance  premiums  paid to the Reinsurer by the
     Company  as a  deduction  in the tax  statement  of the  Company.  Such tax
     reimbursement  shall be at an average tax rate unless the Company  requests
     reimbursement at the exact tax rate.


                                       9

<PAGE>

                                  ARTICLE VIII

                           Reinsurance Administration

1.   Reinsurance  ceded under this Agreement  shall be on a  self-administration
     basis.

     a)   The Company  shall have the  responsibility  of  maintaining  adequate
          records for the administration of the reinsurance ceded hereunder.

     b)   Reinsurance  premiums shall be paid on an annual basis in advance, but
          if a reinsured  policy is terminated or reduced in accordance with the
          provisions of this  Agreement,  the Reinsurer shall refund the Company
          the unearned portion of the reinsurance premium.

     c)   Reinsurance  premiums  and  adjustments  shall  be  accounted  for and
          settled quarterly. Within 45 days after the beginning of each calendar
          quarter,  the  Company  shall send to the  Reinsurer  a  statement  of
          premiums for all outstanding new reinsurance  which has been ceded and
          renewal  premiums for all renewal  reinsurance  falling due within the
          previous  quarter.  The statement  shall also include  adjustments  in
          reinsurance premiums due in previous quarters. The Company shall remit
          to the Reinsurer the amount of any net balance due. If the net balance
          is in favor of the Company,  the Reinsurer shall remit to the Company.
          Except as provided in Article IV, the payment of reinsurance  premiums
          shall be a condition precedent to the liability of the Reinsurer under
          reinsurance covered by this Agreement.  In the event of non-payment of
          reinsurance  premiums  as provided in this  paragraph,  the  Reinsurer
          shall have the right to terminate the  reinsurance  under all policies
          having reinsurance premiums in arrears.

     d)   In addition to the premium  accounting  described  above,  the Company
          will  send  to the  Reinsurer  appropriate  Reports  on New  Business,
          Reserves,  Termination  and  Changes,  Policy  Exhibit,  and an Annual
          Inforce listing.

                                   ARTICLE IX

                                   Reductions

     1.   If all or any part of any  insurance  coverage  reinsured  under  this
          Agreement  shall be reduced or  terminated,  the amount of reinsurance
          carried  by the  Reinsurer  with  respect  to that  coverage  shall be
          reduced  by  the  total  amount  of  insurance   coverage  reduced  or
          terminated as of the date and time of such  reduction or  termination.
          The  reduction  in the  reinsurance  of the  Reinsurer  shall  be that
          proportion of the total amount of the reduction  which  reinsurance of
          the Reinsurer  bears to the total amount  reinsured.  In no case shall
          the  Company be  required  to assume a risk for an amount in excess of
          its regular  retention limit for the age at issue and mortality rating
          of the insured under the policy with respect to which  reinsurance  is
          being reduced or terminated.


                                       10

<PAGE>

                                    ARTICLE X

                      Retention Limit Increases (Recapture)

     1.   If the  Company  increases  its limit of  retention,  a  corresponding
          reduction may be made at the option of the Company in the  reinsurance
          in force on all lives on which the Company  had its  maximum  limit of
          retention at the time reinsurance was ceded. However, no risk shall be
          recaptured  prior  to  the  10th  policy   anniversary   (20th  policy
          anniversary for Security-21).

     2.   Recapture shall be effected as follows:

          (a)  After the  retention  increase is  effected,  the  Company  shall
               promptly notify the Reinsurers of its intention to recapture.

          (b)  Each  eligible  policy  shall be  recaptured  on the first policy
               anniversary following the retention increase.

          (c)  All  eligible  policies  shall  be  recaptured  unless  there  is
               agreement to the contrary expressed in writing.

          (d)  If the Company has  reinsured  any portion of the risk in another
               company,  the  reduction in  reinsurance  ceded under this treaty
               shall  be in the  same  proportion  to  the  total  reduction  in
               reinsurance as the amount reinsured under the treaty bears to the
               total reinsurance on the risk.

          (e)  In  determining  the new  retention for a particular  class,  the
               rules for  classification at time of issue, which may include but
               are not limited to age and rating at issue, shall be used.

          (f)  If at the time of  recapture  the  risk is an  active  claim  for
               Waiver  of  Premium   Disability,   the  Life  risk  shall  still
               nevertheless be considered eligible for recapture.  However,  the
               Disability  reinsurance  shall remain in force until such time as
               the policy is returned to a premium paying status. The Disability
               risk  shall be  recaptured  upon such  return to  premium  paying
               status. However, if within two years of said recapture the Waiver
               of  Premium  is  resumed  due  to an  extension  of  the  initial
               disablement,  the  Reinsurer  shall be liable for  payment of its
               share of premiums  waived by the Company subject to collection of
               Disability  premiums on the Reinsurer's share of the risk for the
               period in which the policy was in a premium paying status.

                                   ARTICLE XI

                         Extended and Paid-Up Insurance

1.   Should a reinsured policy lapse and should extended or paid-up insurance be
     in force in accordance  with the  provisions  of the policy,  the amount of
     reinsurance shall be adjusted accordingly.  For any resulting adjustment in
     amount of insurance,  a  corresponding  adjustment of reinsurance  shall be
     made.  The Company will  continue to pay YRT  premiums  (Exhibit II) on the
     reinsured portion of the Extended Term or Reduced Paid-up policy.


                                       11

<PAGE>

                                   ARTICLE XII

                                 Reinstatements

1.   Should a lapsed insurance policy be reinstated in accordance with its terms
     and the rules of the Company,  the  reinsurance  under such policy shall be
     reinstated  automatically.  Premiums and interest on reinstated reinsurance
     shall be payable only to the extent that the Company collects  premiums and
     interest on such insurance.

                                  ARTICLE XIII

                                 Policy Changes


1.   Should  the  company  make  any  material  changes  in the  provisions  and
     conditions  of a policy  issued to an insured  and upon  which  reinsurance
     shall have been granted hereunder,  the Company shall,  within a reasonable
     time, inform the Reinsurer of such change.


                                   ARTICLE XIV

                              Settlement of Claims

1.   In the case of a claim on a reinsured policy, whether claim payment is made
     under the strict policy conditions or compromised for a lesser amount,  the
     settlement  made by the Company shall be  unconditionally  binding upon the
     Reinsurer. The Company shall keep the Reinsurer informed of any claim which
     might be contested or  compromised  or where  unusual  claim  investigation
     expenses are  contemplated  and, where  practical,  the Company may consult
     with the  Reinsurer.  However,  such  consultation  shall  not  impair  the
     Company's  freedom  to  determine  the  proper  action on the claim and the
     settlement  made by the Company shall still be  unconditionally  binding on
     the Reinsurer.

2.   The Company shall furnish the Reinsurer with copies of the proofs of claim.
     If the Reinsurer so requests,  the Company shall furnish the Reinsurer with
     any  information  the  Company may  possess in  connection  with the claim.
     Payment in settlement of the reinsurance under a claim approved and paid by
     the Company for a life reinsured  hereunder  shall be made by the Reinsurer
     upon the receipt of the claim  papers.  If the total  amount  reinsured  is
     $500,000 or more,  and if the Company so requests,  then the amount due for
     that claim will become  payable as soon as the Company  approves  the claim
     and notifies the Reinsurer.


                                       12

<PAGE>

3.   In the event of an increase  or  reduction  in the amount of the  Company's
     insurance on any policy reinsured  hereunder because of an overstatement or
     understatement  of age or misstatement of sex,  established after the death
     of the insured,  the Company and the Reinsurer shall share in such increase
     or reduction  in  proportion  to their  respective  net amounts  under such
     policy.

4.   If a claim is approved for disability  benefits on a policy reinsured,  the
     Company shall continue to pay premiums for  reinsurance  except the premium
     for disability reinsurance. The Reinsurer shall pay its proportionate share
     of the disability  benefits on the original  policy  including the premiums
     for benefits that remain in effect during disability.

5.   If the Company  decides to contest a claim,  the Reinsurer may pay its full
     share to the Company, as if the claim were not contested,  and such payment
     shall  fulfill the  Reinsurer's  obligation  for that claim.  However,  the
     Reinsurer may, at its option after  consultation with the Company,  join in
     the contest, in which event the Reinsurer will share in the fortunes of the
     Company with respect to such claim. The words "the fortunes" are understood
     to mean only the expenses of the contest and any  reduction in liability as
     specified in paragraph 6a of this Article.

6    a.   If the Reinsurer  joins in the contest,  the Reinsurer  shall share in
          the claim  expense of the contest or compromise of a claim in the same
          proportion  that the net amount at risk reinsured  hereunder  bears to
          the total net risk of the Company on all policies  being  contested by
          the Company and shall share in the total  amount of any  reduction  in
          liability in the same proportion. Claim expense shall include, but not
          be limited to,  cost of  investigation,  legal  fees,  court costs and
          interest  charges.  Compensation of salaries of officers and employees
          and any  possible  extra  contractual  damages,  except as provided in
          paragraph 6 of this Article shall not be considered claim expenses.

     b.   Subject to the  provisions  of Paragraphs c and d of this Article XIV,
          the  Reinsurer  shall  reimburse  the  Company  for its  share  of any
          noncontractual  damages  (including,  but not  limited  to,  punitive,
          exemplary, compensatory or consequential damages) assessed against the
          Company,   provided  the   conditions   precedent  to  liability   for
          noncontractual  damages as specified  in paragraph d of this  Article,
          are met.

     c.   The  Reinsurer  shall not be liable for any portion of  noncontractual
          damages  assessed on the basis of fault or  wrongdoing  on the part of
          the Company,  its agents or representatives  other than for denying or
          contesting the claim.


                                       13

<PAGE>

     d.   Notwithstanding  the  provisions  of Paragraphs b and c, the Reinsurer
          shall  participate  in  noncontractual  damages  assessed  against the
          Company  only in those  cases  where it is clear  that the  denial  or
          contesting  of the claim was the sole basis for the award or  whenever
          the total amount of contractual claims and  noncontractual  damages is
          equal to or less than the face amount of the policy.

     e.   The  Reinsurer  shall  proportionately  share  in  any  assessment  of
          Statutory  Penalties  (herein  defined as those  amounts  awarded as a
          penalty, but fixed in amount by statute).


                        Conditions Precedent to Liability

     f.   Conditions  precedent to liability for  noncontractual  damages are as
          follows:

          1.   The  Reinsurer  shall  have had the  opportunity  to  review  the
               complete claim file prior to any final action by the Company that
               indicates  to the  claimant  that the  claim is being  denied  or
               contested; and

          2.   Upon  completion of such review,  the Reinsurer shall have agreed
               in writing that the claim should be denied or contested.


                                Covered Expenses

     g.   Legal fees incurred in defense against noncontractual damages shall be
          covered  expenses.  The Reinsurer shall reimburse the Company for such
          expenses in the same proportion as described in Paragraph 6a.


                                       14

<PAGE>

                                   ARTICLE XV

                                     Records

1.   The  Reinsurer  shall  have the right at all  reasonable  times and for any
     reasonable  purpose to inspect at the Home  Office of the Company all books
     and documents relating to this reinsurance.

                                   ARTICLE XVI

                                   Insolvency

1.   In the event of the insolvency of the Company, all reinsurance made, ceded,
     renewed or  otherwise  becoming  effective  under this  Agreement  shall be
     payable by the  Reinsurer  directly to the Company or to their  liquidator,
     receiver  or  statutory  successor  on the  basis of the  liability  of the
     Company  under the contract  reinsured  without  diminution  because of the
     insolvency of the Company. It is understood,  however, that in the event of
     the  insolvency  of the Company,  the  liquidator  or receiver or statutory
     successor  of the  insolvent  Company  shall  give  written  notice  of the
     pendency of a claim  against the Company on the policy  reinsured  within a
     reasonable time after such claim is filed in the insolvency  proceeding and
     that during the pendency of such claim that the Reinsurer  may  investigate
     such claim and interpose,  at its own expense, in the proceeding where such
     claim is to be  adjudicated  any  defense or  defenses  which they may deem
     available  to the  Company  or its  liquidator  or  receiver  or  statutory
     successor.

2.   It is further  understood  that the expense thus  incurred by the Reinsurer
     shall be chargeable, subject to court approval, against the Company as part
     of the expense of liquidation to the extent of a proportionate share of the
     benefit  which may accrue to the Company  solely as a result of the defense
     undertaken  by the  Reinsurer.  Where  two or more  assuming  insurers  are
     involved in the same claim and a majority in  interest  elect to  interpose
     defense to such claim,  the expense shall be apportioned in accordance with
     the terms of the  Reinsurance  Agreement  as though  such  expense had been
     incurred by the Company.

                                  ARTICLE XVII

                                   Arbitration

1.   In the event of any difference  arising  hereafter  between the Company and
     the Reinsurer  with reference to this  Agreement or any  transaction  under
     this Agreement, the same shall be referred to three arbitrators who must be
     executive  officers  of  life  insurance   companies  or  life  reinsurance
     companies  other than the parties to this  Agreement  or their  affiliates,
     each of contending companies to appoint one of the arbitrators and such two
     arbitrators to select the third.  Should the two arbitrators not be able to
     agree on the choice of the  third,  then  appointment  shall be left to the
     President of the American Council of Life Insurance.


                                       15

<PAGE>

2.   The  arbitrators  so chosen shall consider this  Reinsurance  Agreement not
     merely as a legal document but also as a gentlemen's agreement.  They shall
     not be bound by any rules of law.  They shall decide by a majority of votes
     and from their  written  decision  there  shall be no  appeal.  The cost of
     arbitration,  including the fees of the arbitrators, shall be borne equally
     by the Reinsurer and the Company.

                                  ARTICLE XVIII

                              Parties to Agreement

1.   This is an  Agreement  solely  between the Company and the  Reinsurer.  The
     acceptance  of  reinsurance  hereunder  shall not create any right or legal
     relation  whatever  between the Reinsurer and the original  insureds or the
     beneficiaries  under any  policies  of the Company  which may be  reinsured
     hereunder.


                                   ARTICLE XIX

                              Duration of Agreement

1.   This  Agreement  shall be unlimited as to its duration but may be cancelled
     at any  time  insofar  as it  pertains  to  the  handling  of new  business
     thereafter by the Company or the Reinsurer,  giving ninety (90) days notice
     of  cancellation  in  writing.  The  Reinsurer  shall  continue  to  accept
     reinsurance in accordance  with this  Agreement  during the ninety (90) day
     period aforesaid.  The reinsurance under this Agreement shall be maintained
     in force as long as such  policies  shall  remain in force and  reinsurance
     premiums are paid when due, except as provided in Articles IX and X.


                                   ARTICLE XX

                               Deficiency Reserves

1.   For the  plans  of  insurance  specified  in  Exhibit  III,  the  Reinsurer
     guarantees  that the YRT  reinsurance  premiums  will not  exceed the gross
     premiums of the Company.


                                       16

<PAGE>

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
in duplicate by their duly authorized representatives.


                                    LINCOLN SECURITY LIFE INSURANCE COMPANY


                            By: /s/ Stanley Avitabile, Exec. V.P. & Med Director
                                ------------------------------------------------
                                        Authorized Officer         Title

Attest:

By: /s/  Paul Chhabra,        2nd V.P. & Actuary
    --------------------------------------------
       Authorized Officer             Title


Dated at:  Avon, CT, this 4th day of April, 1984
           --------       ---        -----  ----



                                    SECURITY-CONNECTICUT LIFE INSURANCE COMPANY


                            By: /s/  Timothy Fitch,       2nd V.P. & Actuary
                                ------------------------------------------------
                                  Authorized Officer              Title

Attest:

By: /s/  Ann O'Brien, Assistant Secretary
    -------------------------------------
      Authorized Officer      Title



Dated at:  Avon, CT, this 4th day of April, 1984
           --------       ---        -----  ----


                                       17

<PAGE>

                                    EXHIBIT I

     Maximum Limits of Company Retention and Limits of Reinsurance Coverage
     ----------------------------------------------------------------------

I.   Maximum Limits of Company Retention

     A.   Life: All Ages, All Ratings through Table P (500%)

                         $100,000

     B.   Waiver of Premium: Same as Life

     C.   Accidental Death: $0

     D.   Conditional Receipt: $50,000


II.  Maximum Limits of Automatic Reinsurance Coverage

     A.   Life: All Ages, All Ratings through Table P (500%)

                          $900,000

     B.   Waiver of Premium: Same as Life

     C.   Accidental Death: $300,000

     D.   Conditional Receipt: $900,000


     Minimum  Initial Cession - the minimum amount to be reinsured on any policy
     is $10,000.  Reinsurance shall be cancelled if reinsured amount falls below
     $2,500.


                                       18

<PAGE>

                                 EXHIBIT II - 2
                   SECURITY-CONNECTICUT LIFE INSURANCE COMPANY
                           YEARLY RENEWABLE TERM RATES

Table omitted.


                                       19

<PAGE>

                                 EXHIBIT II - 2
                   SECURITY-CONNECTICUT LIFE INSURANCE COMPANY
                           YEARLY RENEWABLE TERM RATES
                                    (cont'd)

Table omitted.


                                       20

<PAGE>

                              SECURITY CONNECTICUT
                    EXPERIENCE REFUND YRT PREMIUMS PER $1000
                               MALE STANDARD RISK
                              AGE NEAREST BIRTHDAY

Table omitted.


<PAGE>

                               EXHIBIT II - PART 3

1.   SEC-21  will be  reinsured  on a YRT  basis,  using the rates on pages 21-a
     through 21-j.

     Substandard  rates are 25% of the  standard  rates for each table  (25%) of
     extra mortality.

     Female rates are equal to male rates set back 6 years.

     No policy fee.

2.   One and Five Year R&C will be reinsured  on a YRT basis,  with the YRT rate
     equal to the gross premium less the following commission allowances:


                              Commission Allowance

                              ---- Policy Year ----


            Band(s)           1            2-5         6-10         11+
            -------           -            ---         ----         ---
             1-2             100%          24%          24%         17%
             3-4             100%          16%          11%          4%
               5              85%          26%          11%          4%



                                       21

<PAGE>


                   SECURITY CONNECTICUT LIFE INSURANCE COMPANY

                                   SECURITY 21
                           YEARLY RENEWABLE TERM RATES

                                NONSMOKER BAND 1

Table omitted.

<PAGE>



                   SECURITY CONNECTICUT LIFE INSURANCE COMPANY

                                   SECURITY 21
                           YEARLY RENEWABLE TERM RATES

                                NONSMOKER BAND 2

Table omitted.

<PAGE>



                   SECURITY CONNECTICUT LIFE INSURANCE COMPANY

                                   SECURITY 21
                           YEARLY RENEWABLE TERM RATES

                                NONSMOKER BAND 3


Table omitted.

<PAGE>



                   SECURITY CONNECTICUT LIFE INSURANCE COMPANY

                                   SECURITY 21
                           YEARLY RENEWABLE TERM RATES

                                NONSMOKER BAND 4


Table omitted.

<PAGE>



                   SECURITY CONNECTICUT LIFE INSURANCE COMPANY

                                   SECURITY 21
                           YEARLY RENEWABLE TERM RATES

                                NONSMOKER BAND 5


Table omitted.

<PAGE>



                   SECURITY CONNECTICUT LIFE INSURANCE COMPANY

                                   SECURITY 21
                           YEARLY RENEWABLE TERM RATES

                                  SMOKER BAND 1


Table omitted.


<PAGE>



                   SECURITY CONNECTICUT LIFE INSURANCE COMPANY

                                   SECURITY 21
                           YEARLY RENEWABLE TERM RATES

                                  SMOKER BAND 2


Table omitted.

<PAGE>



                   SECURITY CONNECTICUT LIFE INSURANCE COMPANY

                                   SECURITY 21
                           YEARLY RENEWABLE TERM RATES

                                  SMOKER BAND 3


Table omitted.

<PAGE>



                   SECURITY CONNECTICUT LIFE INSURANCE COMPANY

                                   SECURITY 21
                           YEARLY RENEWABLE TERM RATES

                                  SMOKER BAND 4


Table omitted.

<PAGE>



                   SECURITY CONNECTICUT LIFE INSURANCE COMPANY

                                   SECURITY 21
                           YEARLY RENEWABLE TERM RATES

                                  SMOKER BAND 5


Table omitted.


<PAGE>

                               EXHIBIT II - PART 4

                         Accidental Death Benefit Rates

                                    Standard

                                       .54




                                   Substandard


 Substandard premium shall be the appropriate multiple of the standard premium.



                                       22

<PAGE>

                                   EXHIBIT III

                               Plans of Insurance

                        Economy Life - 5-1/2% (#10640NY)

                    Increasing Premium Whole Life (#10780NY)

                          Life Paid Up at 95 (#10850NY)



                                       23

<PAGE>

                                   ADDENDUM I


Addendum to the  Reinsurance  Agreement  (effective  April 1, 1984)  between the
Lincoln  Security  Life  Insurance  Company,  hereinafter  referred  to  as  the
"Company", and Security-Connecticut Life Insurance Company, hereinafter referred
to as the "Reinsurer".

It is  hereby  agreed  that  Exhibit  II - Part 5 shall be  added  to the  above
mentioned  Reinsurance  Agreement  to  incorporate  reinsurance  rates for Joint
Design and Estate Design effective the dates stated within.

Except as herein  specified,  all the terms and  conditions  of the  Reinsurance
Agreement  shall apply,  and this Addendum is to be attached to and made part of
the aforesaid agreement.




Security-Connecticut Life Insurance Company

Witness: /s/  Paul V. Susi                  By:  /s/  William Casill
         -------------------------------         -------------------------------

Title:   A.V.P. & Assoc. Actuary            Title:    Vice President & Actuary
         -------------------------------         -------------------------------



Lincoln Security Life Insurance Company

Witness: /s/  J. Paul Chhabra               By: /s/  Robert J. Voight
         -------------------------------        --------------------------------

Title:   Actuary                            Title:   Executive Vice President
         -------------------------------         -------------------------------


<PAGE>


                                  MULTIPLE LIFE
                              REINSURANCE PREMIUMS


                               EXHIBIT II - PART 5

Table omitted.



<PAGE>



                               JOINT DESIGN SERIES
                     FIFTEEN YEAR SELECT REINSURANCE PROGRAM

                                                          Effective June 1, 1992

USE OF THE RATE SCHEDULE


The YRT premium shall be derived by applying the rates herein:

SUBSTANDARD RISKS
-----------------


The  reinsurance  premium for  substandard  risks rated on a multiple  mortality
table basis shall be equal to a multiple of the standard rate  proportionate  to
the mortality classification.  Thus, the premium for a Class D (200%) risk shall
be equal to twice the standard premium.



POLICY FEE



None.



<PAGE>




                ANNUAL GIOR REINSURANCE RATES - PREFERED/STANDARD


Table omitted.


<PAGE>


   ANNUAL JOINT DESIGN REINSURANCE RATES FOR LSNY - PREFERED - TWO NONSMOKERS


Table omitted.

<PAGE>


    ANNUAL JOINT DESIGN REINSURANCE RATES FOR LSNY - PREFERED - TWO SMOKERS


Table omitted.



<PAGE>


  ANNUAL JOINT DESIGN REINSURANCE RATES FOR LSNY - PREFERED - SMOKER/NONSMOKER


Table omitted.

<PAGE>


   ANNUAL JOINT DESIGN REINSURANCE RATES FOR LSNY - STANDARD - TWO NONSMOKERS


Table omitted.

<PAGE>


    ANNUAL JOINT DESIGN REINSURANCE RATES FOR LSNY - STANDARD - TWO SMOKERS


Table omitted.

<PAGE>


  ANNUAL JOINT DESIGN REINSURANCE RATES FOR LSNY - STANDARD - SMOKER/NONSMOKER


Table omitted.

<PAGE>


                              ESTATE DESIGN SERIES

                     FIFTEEN YEAR SELECT REINSURANCE PROGRAM

                                                      Effective November 1, 1992
USE OF THE RATE SCHEDULE

The appropriate YRT premium shall be derived by applying the rates herein:

SUBSTANDARD RISKS


A table  rating on either or both lives  will be  converted  into a joint  table
rating or a joint flat extra or a  combination  of the two.  For the joint table
rating portion of the risk, the total  reinsurance  premium will be equal to the
standard  reinsurance premium increased by a proportional  amount. For the joint
flat extra portion of the risk associated with the individual  table  rating(s),
the total  reinsurance  premium will be increased by the joint flat extra. For a
joint  flat  extra  attributable  to a flat  extra  rating on one or both of the
individuals, the total reinsurance premium will be determined in accordance with
paragraph 2 or 3 of Article VI, as appropriate.


POLICY FEE



None.


<PAGE>


                                  AMENDMENT II

Amendment to Reinsurance Agreement (effective April 1, 1984) between the Lincoln
Security Life Insurance Company,  hereinafter referred to as the "Company",  and
Security-Connecticut  Life  Insurance  Company,  hereinafter  referred to as the
"Reinsurer".

1.   It is hereby  agreed  that on and after  the  first day of  January,  1987,
     Article VII, "Tax Credits" under the above mentioned  Reinsurance Agreement
     shall be replaced with the following:

          The   Reinsurance   premium  rates  under  this  Agreement  take  into
          consideration the Company's liability for premium taxes.  Accordingly,
          the Reinsurer shall make no separate  reimbursement to the Company for
          premium taxes on premiums paid to the reinsurer.

2.   It is hereby  agreed  that on and after  the  first  day of  January,  1987
     Exhibit II - Part 2 shall be replaced with the attached.

All provisions of the Reinsurance  Agreement not in conflict with the provisions
of this amendment will continue unchanged.


 Security-Connecticut Life Insurance Company

Witness: /s/  Paul V. Susi                     By:  /s/ William Casill
         -----------------------------              ----------------------------

Title:        A.V.P. & Assoc. Actuary          Title:   Vice President & Actuary
         -----------------------------              ----------------------------



 Lincoln Security Life Insurance Company

Witness: /s/  J. Paul Chhabra                  By:  /s/ Robert J. Voight
         ------------------------------             ----------------------------

Title:        Actuary                          Title:   Executive Vice President
         ------------------------------             ----------------------------


<PAGE>


                              REINSURANCE PREMIUMS


<PAGE>


                               Exhibit II - Part 2

                   Fifteen Year Select YRT Reinsurance Program

Use of the Rate schedule

The appropriate YRT premium shall be derived by applying the following multiples
to the rates contained herein:

                Underwriting                Multiple
                Classification
                --------------
                Standard                    1.00
                Preferred                   0.83
                Non-preferred               1.09

The schedule contains YRT rates for male issue ages 0-85.

Female Rates

Age 0 - Use rates for males issues age 0
Ages 1-5 - Use rates for males issue age 1
Ages 6 and older - Use rates for males five years younger.

Female risks are subject to the maximum true issue age limit of 85.

Policy fee:
         None.

Substandard Risks:

     The  reinsurance  premium for  substandard  risks rated on a multiple table
     basis shall be equal to the multiple of the standard rate  proportionate to
     the mortality  classification.  Thus, the premium for a Class D (200%) risk
     shall be equal to twice the standard premium.



<PAGE>



                              SECURITY CONNECTICUT

                    EXPERIENCE REFUND YRT PREMIUMS PER $1000
                               MALE STANDARD RISK
                              AGE NEAREST BIRTHDAY

                       SUB-POOL A - CLASSICAL UNDERWRITING


Table omitted.



<PAGE>

                              SECURITY CONNECTICUT

                    EXPERIENCE REFUND YRT PREMIUMS PER $1000
                               MALE STANDARD RISK
                              AGE NEAREST BIRTHDAY

                     SUB-POOL A - NON-CLASSICAL UNDERWRITING

Table omitted.


<PAGE>

                             SECURITY CONNECTICUT

                    EXPERIENCE REFUND YRT PREMIUMS PER $1000
                               MALE STANDARD RISK
                              AGE NEAREST BIRTHDAY

                                   SUB-POOL A

                                 ULTIMATE RATES

Table omitted.


<PAGE>



                              SECURITY CONNECTICUT

                    EXPERIENCE REFUND YRT PREMIUMS PER $1000
                               MALE STANDARD RISK
                              AGE NEAREST BIRTHDAY

                         UNDIFFERENTIATED ULTIMATE RATES

Table omitted.


<PAGE>



                              SECURITY CONNECTICUT

                    EXPERIENCE REFUND YRT PREMIUMS PER $1000
                               MALE STANDARD RISK
                              AGE NEAREST BIRTHDAY

                        SUB-POOL B CLASSICAL UNDERWRITING

Table omitted.


<PAGE>



                              SECURITY CONNECTICUT

                    EXPERIENCE REFUND YRT PREMIUMS PER $1000
                               MALE STANDARD RISK
                              AGE NEAREST BIRTHDAY

                      SUB-POOL B NON-CLASSICAL UNDERWRITING



Table omitted.


<PAGE>



                              SECURITY CONNECTICUT

                    EXPERIENCE REFUND YRT PREMIUMS PER $1000
                               MALE STANDARD RISK
                              AGE NEAREST BIRTHDAY

                                   SUB-POOL B

                                 ULTIMATE RATES

Table omitted.


<PAGE>



                              SECURITY CONNECTICUT

                    EXPERIENCE REFUND YRT PREMIUMS PER $1000
                               MALE STANDARD RISK
                              AGE NEAREST BIRTHDAY

                         UNDIFFERENTIATED ULTIMATE RATES


Table omitted.


<PAGE>



                                  AMENDMENT III

Amendment to Reinsurance Agreement (effective April 1, 1984) between the Lincoln
Security Life Insurance Company,  hereinafter referred to as the "Company",  and
Security-Connecticut  Life  Insurance  Company,  hereinafter  referred to as the
"Reinsurer".

It is hereby agreed that on and after the first day of January,  1987, under the
above mentioned  reinsurance  agreement,  Article I, paragraph 5 shall be placed
with the following:

Exceptions to Automatic Coverage

5.   Reinsurance shall not be ceded automatically on any life if:

     a.   The amount of life insurance in force plus the amount  currently being
          applied for on that life in all companies  exceeds ten million dollars
          ($10,000,000); or

     b.   The substandard  mortality  rating assessed by the Company to the risk
          exceeds  Class P (500%) or its  equivalent  on an extra  premium basis
          (for flat extras, each $2.50 equals one table); or

     c.   The insurance is the result of group conversion where full evidence of
          insurability has not been secured.

     d.   The  Company  has  submitted  the risk for  facultative  consideration
          outside of the Agreement.

All provisions of the Reinsurance  Agreement not in conflict with the provisions
of the amendment will continue unchanged.


                  Security - Connecticut Life Insurance Company


Witness: /s/ Paul Susi                      By: /s/  William Casill
         ----------------------------           --------------------------------

Title:       A.V.P. & Assoc. Actuary        Title:   Vice President & Actuary
         ----------------------------           --------------------------------



                     Lincoln Security Life Insurance Company

Witness: /s/  J. Paul Chhabra               By: /s/  Robert Voight
         ----------------------------           --------------------------------

Title:        Actuary                       Title:   Executive Vice President
         ----------------------------           --------------------------------


<PAGE>



                                  AMENDMENT IV


Amendment to Reinsurance Agreement (effective April 1, 1984) between the Lincoln
Security Life Insurance Company,  hereinafter referred to as the "Company",  and
Security-Connecticut  Life  Insurance  Company,  hereinafter  referred to as the
"Reinsurer".

It is hereby  agreed that on and after the first day of July,  1989 Exhibit II -
Part 2 shall be replaced with the attached.

All provisions of the Reinsurance  Agreement not in conflict with the provisions
of the amendment will continue unchanged.



                   Security-Connecticut Life Insurance Company


Witness: /s/  Paul Susi                       By: /s/  William Casill
         -----------------------------            ------------------------------

Title:   A.V.P. & Assoc. Actuary              Title:   Vice President & Actuary
         -----------------------------            ------------------------------


                     Lincoln Security Life Insurance Company


Witness: /s/  J. Paul Chhabra                 By: /s/  Robert Voight
         -----------------------------            ------------------------------

Title:        Actuary                         Title:   Executive Vice President
         -----------------------------            ------------------------------


<PAGE>


                              REINSURANCE PREMIUMS


<PAGE>


                               EXHIBIT II - PART 2
                     Fifteen Year Select Reinsurance Program

Use of the Rate Schedule

The appropriate YRT premium shall be derived by applying the following multiples
to the rates combined herein:


                                 Issue Ages 0-59

     Duration          PNS            PS            NS           S
     --------          ---            --            --           -

        1             .10            .10            .29         .28
        2             .87            .83           1.04         .96
        3             .90            .84           1.05         .97
        4             .89            .84           1.05         .97
      5-10            .89            .85           1.07         .98
       11+            .85            .82           1.00         .95


                                 Issue Ages 60+

     Duration          PNS            PS            NS           S
     --------          ---            --            --           -

        1             .12            .12            .32         .28
        2             .89            .85           1.07         .96
        3             .92            .86           1.08         .97
        4             .91            .86           1.08         .97
      5-10            .91            .87           1.10         .98
       11+            .87            .84           1.03         .95


<PAGE>

Female Rates
------------

                     Age 0            Use rates for males issue age 0
                     Ages 1 to 5      Use rates for males issue age 1
                     Ages 6 to older  Use rates for males 5 years younger

Female risks are subject to the maximum true issue age limit of 85.

Substandard Risks

The  reinsurance  premiums for substandard  risks rated on a multiple  mortality
tables basis shall be equal to the multiple of the standard  rate  proportionate
to the  mortality  classification.  Thus,  the premium for a Class D (200%) risk
shall be equal to twice the standard premium.


Policy Fee
----------


None.


<PAGE>


                   SECURITY-CONNECTICUT LIFE INSURANCE COMPANY

                       NON-REFUND PREMIUM RATES PER $1000
                            STANDARD MALE NON-SMOKER
                              AGE NEAREST BIRTHDAY

Table omitted.


<PAGE>



                   SECURITY-CONNECTICUT LIFE INSURANCE COMPANY

                       NON-REFUND PREMIUM RATES PER $1000
                              STANDARD MALE SMOKER
                              AGE NEAREST BIRTHDAY

Table omitted.


<PAGE>


                                    AMENDMENT


Amendment to each  Reinsurance  Agreement listed herein between Lincoln Security
Life  Insurance  Company,   hereinafter  referred  to  as  the  "Company",   and
Security-Connecticut  Life  Insurance  Company,  hereinafter  referred to as the
"Reinsurer".

It is hereby agreed that on and after the effective  date of each such Agreement
listed, Article VIII, "Reinsurance  Administration",  shall be replaced with the
following:

1.   Reinsurance ceded under this Agreement shall be Bordereau administration.

     a.   The Reinsurer shall have the  responsibility  of maintaining  adequate
          records for the administration of the reinsurance ceded hereunder.

     b.   Reinsurance  premiums shall be paid on an annual basis in advance, but
          if a reinsured  policy is terminated or reduced in accordance with the
          provisions of this  Agreement,  the Reinsurer shall refund the Company
          the unearned portion of the reinsurance premium.

     c.   Reinsurance  premiums  and  adjustments  shall  be  accounted  for and
          settled  monthly and quarterly.  Within 45 days after the beginning of
          each  calendar  month or  quarter,  the  Reinsurer  shall  calculate a
          statement  of premiums  for all  outstanding  reinsurance  falling due
          within the previous month or quarter. The statement shall also include
          adjustments  in  reinsurance   premiums  due  in  previous  months  or
          quarters.  The Company  shall remit to the Reinsurer the amount of any
          net balance  due. If the net balance is in favor of the  Company,  the
          Reinsurer  shall remit to the  Company.  Except as provided in Article
          IV, the payment of reinsurance premiums shall be a condition precedent
          to the liability of the Reinsurer  under  reinsurance  covered by this
          Agreement.  In the event of  non-payment  of  reinsurance  premiums as
          provided  in this  paragraph,  the  Reinsurer  shall have the right to
          terminate  the  reinsurance  under  all  policies  having  reinsurance
          premiums in arrears.

     d.   In addition to the premium  accounting  described above, the Reinsurer
          will   create   appropriate   reports  on  New   Business,   Reserves,
          Terminations  and  changes,  Policy  Exhibit,  and an  Annual  Inforce
          listing.

Except as herein  specified,  all the terms and  conditions  of the  Reinsurance
Agreement  shall apply and this  amendment is to be attached to and made part of
the aforesaid Agreement.


<PAGE>



                   Security-Connecticut Life Insurance Company


Witness: /s/  Paul Susi                       By: /s/  William Casill
         -----------------------------            ------------------------------

Title:   A.V.P. & Assoc. Actuary              Title:   Vice President & Actuary
         -----------------------------            ------------------------------


                     Lincoln Security Life Insurance Company


Witness: /s/  J. Paul Chhabra                 By: /s/  Robert Voight
         -----------------------------            ------------------------------

Title:        Actuary                         Title:   Executive Vice President
         -----------------------------            ------------------------------



<PAGE>



 Treaty Type                                  Treaty Effective Date
 -----------                                  ---------------------
 Automatic/YRT                                   April I, 1984
 Automatic/Co.                                   January 1, 1987


<PAGE>


                                    AMENDMENT


Amendment to each  Reinsurance  Agreement listed herein between Lincoln Security
Life  Insurance   Company,   hereinafter   referred  to  as  the  "Company"  and
Security-Connecticut  Life  Insurance  Company,  hereinafter  referred to as the
"Reinsurer".

1.   The Company and the  Reinsurer  each  represents  and  warrants  that it is
     subject to taxation under  Subchapter  "L" of the Internal  Revenue Code of
     1986 (the "code").

2.   The terms used in this  Amendment  are defined by Reference  to  Regulation
     Section 1.848-2(g)(8) promulgated on December 29, 1992, whereby:

     a.   Each party shall  attach a schedule  to its Federal  Income Tax return
          which  identifies  the relevant  reinsurance  agreements for which the
          joint election under the Regulation has been made;

     b.   The  party  with  net  positive  consideration,   as  defined  in  the
          Regulation  promulgated  under Code Section 848, for such  Reinsurance
          Agreements for each taxable year,  shall  capitalize  specified policy
          acquisition  expenses  with  respect  to such  Reinsurance  Agreements
          without regard to the general deductions  limitation of Section 848(c)
          (1);

     c.   Each party agrees to exchange information  pertaining to the amount of
          net  consideration  under  such  Reinsurance  Agreements  each year to
          ensure consistency;

     d.   The Company will submit a schedule to the  Reinsurer by June 1 of each
          year of its  calculation  of the net  consideration  for the preceding
          calendar year. The Reinsurer may contest such calculation by providing
          an  alternative  calculation  to the Company in writing  within thirty
          (30) days of the Reinsurer's receipt of the Company's calculation. The
          Company and the Reinsurer will act in good faith to reach an agreement
          as to the  correct  amount  within  thirty  (30)  days of the date the
          Reinsurer submits its alternative calculation.

The  provisions  of this  Agreement  shall be  subject  to all the  Terms of the
Agreement which do not conflict with the Terms hereof.



<PAGE>


                   Security-Connecticut Life Insurance Company


Witness: /s/  Paul Susi                       By: /s/  William Casill
         -----------------------------            ------------------------------

Title:   A.V.P. & Assoc. Actuary              Title:   Vice President & Actuary
         -----------------------------            ------------------------------


                     Lincoln Security Life Insurance Company


Witness: /s/  J. Paul Chhabra                 By: /s/  Robert Voight
         -----------------------------            ------------------------------

Title:        Actuary                         Title:   Executive Vice President
         -----------------------------            ------------------------------



<PAGE>


                   SECURITY-CONNECTICUT LIFE INSURANCE COMPANY



            Treaty Type                             Treaty Effective Date
            -----------                             ---------------------
            Automatic/YRT                           April 1, 1984
            Automatic/CO                            January 1, 1987


<PAGE>


                                    AMENDMENT


Amendment to each  Reinsurance  Agreement listed herein between Lincoln Security
Life  Insurance   Company,   hereinafter   referred  to  as  the  "Company"  and
Security-Connecticut  Life  Insurance  Company,  hereinafter  referred to as the
"Reinsurer".

It is hereby agreed that on and after the first day of January,  1994, under all
Reinsurance  Agreements  between  the  Company  and the  Reinsurer,  the  entire
Agreement Article will be added and the Arbitration Article will be replaced.

                                Entire Agreement

1.   This  Agreement,  Amendments,  and  Addenda  shall  constitute  the  entire
     agreement between the parties with respect to business reinsured hereunder.
     There are no understandings  between the parties other than as expressed in
     this  Agreement and any future  change or  modification  of this  Agreement
     shall be null and void unless made by Amendment to the Agreement and signed
     by both parties.

                                   Arbitration

1.   In the event of any difference  arising  hereafter  between the contracting
     parties with reference to any transaction  under this  Agreement,  the same
     shall be referred to three  arbitrators  who must be executive  officers of
     life insurance or life reinsurance  companies other than the two parties to
     this Agreement or their  affiliates,  each of the contracting  companies to
     appoint  one of the  arbitrators  and such two  arbitrators  to select  the
     third. If either party refuses or neglects to appoint an arbitrator  within
     thirty (30) days after receipt of the written request for arbitrators,  the
     initiating party may appoint a second arbitrator.

2.   If the two arbitrators fail to agree on the selection of a third arbitrator
     within  thirty  (30) days for their  appointment,  each of them  shall name
     three  individuals,  of whom the other shall  decline two, and the decision
     shall be made by drawing lots.

3.   The arbitrators  shall consider this Reinsurance  Agreement not merely as a
     legal document but also a gentlemen's agreement.  In resolving the dispute,
     the arbitrators  will give full  consideration to the customs and practices
     of the life insurance and life  reinsurance  industry,  insofar as they are
     not in conflict with the specific terms of this Agreement.  The arbitrators
     shall  decide by a  majority  vote.  There  shall be no appeal  from  their
     written decision.

4.   Unless the arbitrators decide otherwise,  each party shall bear the expense
     of its own arbitration, including its arbitrator and outside attorney fees,
     and shall  jointly and equally bear with the other party the expense of the
     third arbitrator.  Any remaining costs of the arbitration proceedings shall
     be appointed by the Board of Arbitrators.



<PAGE>



IN WITNESS WHEREOF,  the Company and the Reinsurer have caused their names to be
subscribed and duly attested thereunder by their respective authorized officers.


                   Security-Connecticut Life Insurance Company


Witness: /s/  Paul Susi                       By: /s/  William Casill
         -----------------------------            ------------------------------

Title:   A.V.P. & Assoc. Actuary              Title:   Vice President & Actuary
         -----------------------------            ------------------------------


                     Lincoln Security Life Insurance Company


Witness: /s/  J. Paul Chhabra                 By: /s/  Robert Voight
         -----------------------------            ------------------------------

Title:        Actuary                         Title:   Executive Vice President
         -----------------------------            ------------------------------


<PAGE>


                   SECURITY-CONNECTICUT LIFE INSURANCE COMPANY


         Treaty Type                               Treat/ Effective Date
         -----------                               ---------------------
         Automatic/YRT                             April 1, 1984
         Automatic/CO                              January 1, 1987


<PAGE>



                                    AMENDMENT

Effective on and after November 28, 1995,  all  Reinsurance  Agreements  between
Security-Connecticut   Life  Insurance  Company,   herein  referred  to  as  the
"Reinsurer",  and Lincoln Security Life Insurance Company, herein referred to as
the "Company", shall be amended to include the following:

The Reinsurer  agrees to establish an  irrevocable  Letter of Credit in favor of
the  Company.  The Amount of such Letter of Credit will be at least equal to the
aggregate of the statutory  reserves plus any paid and unpaid losses recoverable
from  reinsurance  assumed  by the  Reinsurer  from the  Company  under all such
Reinsurance Agreements.

The  irrevocable  Letter of Credit shall be issued in compliance with Regulation
133 of the New York Insurance  Regulations and shall be subject to the following
provisions:

1.   The Reinsurer  and the Company agree that the Letter of Credit  provided by
     the Reinsurer  pursuant to the  provisions  of this  Amendment may be drawn
     upon at any time,  notwithstanding any other provision in these reinsurance
     agreements and may be utilized by the Company or any successor by operation
     of  law of the  Company  including,  without  limitation,  any  liquidator,
     rehabilitation,  receiver or  conservator  of the Company for the following
     purposes:

     a.   To  reimburse  the  Company  for the  Reinsurer's  share  of  premiums
          returned to the owners of  policies  insured  under these  reinsurance
          agreements on account of cancellations of such policies;

     b.   To reimburse the Company for the  Reinsurer's  share of surrenders and
          benefits or losses paid by the Company under the terms and  provisions
          of the policies reinsured under these reinsurance agreements;

     c.   To fund an account with the Company in an amount at least equal to the
          deduction,  for reinsurance ceded, from the Company's  liabilities for
          policies  reinsured under these  agreements such amount shall include,
          but not be limited  to,  amounts  for policy  reserves,  reserves  for
          claims  and  losses  incurred   (including  losses  incurred  but  not
          reported), loss adjustment expense and unearned premiums;

     d.   To pay any other  amounts  the  Company  claims  are due  under  these
          reinsurance agreements.

     2.   All of the foregoing should be applied without  diminution  because of
          insolvency on the part of the Company or the Reinsurer.



<PAGE>

3.   The Company  shall return  immediately  any amounts  drawn on the Letter of
     Credit in excess of the actual  amounts  required for paragraphs 1a, 1b and
     1c of this  amendment or in the case of paragraph ld of this  section,  any
     amounts that are subsequently determined not to be due.

4.   The  Company  shall  pay  the  Reinsurer  an  interest  payment,  at a rate
     equivalent to the prime rates of interest of the bank issuing the Letter of
     Credit, on all amounts held pursuant to paragraphs 1c of this amendment.

Except as herein  specified,  all of the terms and  conditions  of the  existing
Reinsurance  Agreements  between the Reinsurer and the Company shall continue to
apply,  and this  Amendment  shall be  attached  to and made  part of each  such
Reinsurance Agreement.

In witness of the above,  this Amendment is signed in duplicate at the dates and
places indicated.

LINCOLN SECURITY LIFE INSURANCE COMPANY


Witness: /s/  Kim E. Audia             By: /s/  Robert J. Voight
         -------------------------         ------------------------------

Title:                                          Sr. Vice President
                                           ------------------------



SECURITY-CONNECTICUT LIFE INSURANCE COMPANY


Witness: /s/  Kim E. Audia             By: /s/  Richard Mocarski
         -------------------------         ------------------------------

Title:                                          VP, Controller & Treasurer
                                           -------------------------------



<PAGE>



                              REINSURANCE AGREEMENT


               Lincoln Security Life Insurance Company ("Company")

                                       and

            Security-Connecticut Life Insurance Company ("Reinsurer")




            TREATY TYPE                               TREATY EFFECTIVE DATE
            -----------                               ---------------------
            Automatic/YRT                             April 1, 1984
            Automatic/CO                              January 1, 1987


<PAGE>



                                   AMENDMENT V


Amendment to Reinsurance Agreement (effective April 1, 1984) between the Lincoln
Security Life Insurance Company,  hereinafter referred to as the "Company",  and
Security-Connecticut  Life  Insurance  Company,  hereinafter  referred to as the
"Reinsurer".

It is hereby agreed that on and after the first day of January, 1992, Exhibit II
- Part 2 shall be replaced with the attached.

All provisions of the Reinsurance  Agreement not in conflict with the provisions
of the amendment will continue unchanged.

                   Security-Connecticut Life Insurance Company


Witness: /s/  Paul V. Susi                    By: /s/  William Casill
         -----------------------------            ------------------------------

Title:   A.V.P. & Assoc. Actuary              Title:   Vice President & Actuary
         -----------------------------            ------------------------------


                     Lincoln Security Life Insurance Company


Witness: /s/  J. Paul Chhabra                 By: /s/  Robert J. Voight
         -----------------------------            ------------------------------

Title:        Actuary                         Title:   Executive Vice President
         -----------------------------            ------------------------------


<PAGE>




                              REINSURANCE PREMIUMS


                               EXHIBIT II - PART 2

<PAGE>

                     Fifteen Year Select Reinsurance Program


          Duration         PNS        PS       NS          S
          --------         ---        --       --          -
             1             .00       .00       .00        .00
            2-15           .74       .71       .88        .84
            16+            .76       .73       .91        .87


Female Rates

Age 0 - Use rates for males  issue age 0
Ages 1 to 5 - Use rates for males issue age 1
Ages 6 to older - Use rates for males 5 years younger

Female risks are subject to the maximum true issue age limit of 85.

Substandard Risks

The  reinsurance  premiums for substandard  risks rated on a multiple  mortality
tables basis shall be equal to the multiple of the standard  rate  proportionate
to the  mortality  classification.  Thus,  the premium for a Class D (200%) risk
shall be equal to twice the standard premium.

Policy Fee

None.


<PAGE>



                   SECURITY-CONNECTICUT LIFE INSURANCE COMPANY

                       NON-REFUND PREMIUM RATES PER $1000
                            STANDARD MALE NON-SMOKER
                              AGE NEAREST BIRTHDAY


Table omitted.

<PAGE>



                   SECURITY-CONNECTICUT LIFE INSURANCE COMPANY

                       NON-REFUND PREMIUM RATES PER $1000
                              STANDARD MALE SMOKER
                              AGE NEAREST BIRTHDAY



Table omitted.

<PAGE>



                                  AMENDMENT VI


Amendment to the  Reinsurance  Agreement  effective  April 1, 1984,  between the
Lincoln  Security  Life  Insurance  Company,  hereinafter  referred  to  as  the
"Company", and Security-Connecticut Life Insurance Company, hereinafter referred
to as the "Reinsurer".

It is hereby  agreed that Exhibit III shall be replaced  with the attached  with
the appropriate effective dates.

All provisions of the Reinsurance  Agreement not in conflict with the provisions
of the amendment will continue unchanged.

                   Security-Connecticut Life Insurance Company


Witness: /s/  Paul V. Susi                    By: /s/  William Casill
         -----------------------------            ------------------------------

Title:   A.V.P. & Assoc. Actuary              Title:   Vice President & Actuary
         -----------------------------            ------------------------------


                     Lincoln Security Life Insurance Company


Witness: /s/  J. Paul Chhabra                 By: /s/  Robert J. Voight
         -----------------------------            ------------------------------

Title:        Actuary                         Title:   Executive Vice President
         -----------------------------            ------------------------------


<PAGE>


                               Plans of Insurance



Omitted.

<PAGE>

                                  AMENDMENT VII


Amendment to Reinsurance Agreement (effective April 1, 1984) between the Lincoln
Security Life Insurance Company,  hereinafter referred to as the "Company",  and
Security-Connecticut  Life  Insurance  Company,  hereinafter  referred to as the
"Reinsurer".

It is hereby agreed that Exhibit II - Part 4 shall be replaced with the attached
with the stated effective dates.

All provisions of the Reinsurance Agreement not in conflict with the provisions
of the amendment will continue unchanged.


                   Security-Connecticut Life Insurance Company


Witness: /s/  Paul V. Susi                    By: /s/  William Casill
         -----------------------------            ------------------------------

Title:   A.V.P. & Assoc. Actuary              Title:   Vice President & Actuary
         -----------------------------            ------------------------------


                     Lincoln Security Life Insurance Company


Witness: /s/  J. Paul Chhabra                 By: /s/  Robert J. Voight
         -----------------------------            ------------------------------

Title:        Actuary                         Title:   Executive Vice President
         -----------------------------            ------------------------------



<PAGE>



                         Accidental Death Benefit Rates


                                    Standard


                            Effective January 1, 1985

                                      $0.52


                            Effective January 1, 1988

                                      $0.48


                            Effective January 1, 1991

                                      $0.45


                            Effective January 1, 1994

                                      $0.34


Substandard

Substandard premium shall be the appropriate multiple of the standard premium.


                               EXHIBIT II - PART 4


<PAGE>

                                 AMENDMENT VIII


Effective on or after November 20, 1996, the  Reinsurance  Agreement  (effective
April 1, 1984) between  Security-Connecticut Life Insurance,  herein referred to
as the "Reinsurer", and Lincoln Security Life Insurance Company, herein referred
to as the "Company", shall be amended to include the following:

The Reinsurer  agrees to establish a Trust  Agreement in favor of the Company to
replace the "Letter of Credit" Amendment, effective November 28, 1995. The trust
account will be at least equal to the aggregate of the  statutory  reserves plus
any paid and unpaid losses recoverable from reinsurance assumed by the Reinsurer
from the Company under all such Reinsurance Agreements.

The Trust  Agreement  shall be established in compliance  with Regulation 114 of
the New York  Insurance  Regulations  and  shall  be  subject  to the  following
provisions:

1.   Assets  deposited in the trust account  shall be valued  according to their
     current fair market  value,  and shall  consist only of United States legal
     tender,  certificates of deposit issued by a United States bank and payable
     in United States legal tender,  and  investments of the types  specified in
     paragraphs  (1), (2), (3), (8), and (10) of subsection  (a) of section 1404
     of the New York Insurance Law, provided that such investments are issued by
     an institution that is not the parent,  subsidiary,  or affiliate of either
     the grantor or the beneficiary.

2.   Prior to depositing  assets with the trustee,  the Reinsurer is required to
     execute assignments,  endorsements in blank, or transfer legal title to the
     trustee  of  all  shares,   obligations  or  any  other  assets   requiring
     assignments,  in order that the Company,  or the trustee upon the direction
     of the Company,  may whenever  necessary  negotiate any such assets without
     consent or signature from the Reinsurer or any other entity.

3.   All  settlements  of account  between  the Company  and the  Reinsurer  are
     required to be made in cash or its equivalent.

4.   The Reinsurer  and the Company agree that the assets in the trust  account,
     established pursuant to the provisions of the Reinsurance Agreement, may be
     withdrawn by the Company at any time,  notwithstanding any other provisions
     in the  Reinsurance  Agreement,  and shall be  utilized  and applied by the
     Company or any  successor by  operation  of law of the  Company,  including
     without limitation, any liquidator,  rehabilitator, receiver or conversator
     of the Company, without diminution because of insolvency on the part of the
     Company or the Reinsurer, only for the following purposes:

     a)   to  reimburse  the  Company  for the  Reinsurer's  share  of  premiums
          returned to the owners of  policies  reinsured  under the  Reinsurance
          Agreement on account of cancellations of such policies;

     b)   to reimburse the Company for the  Reinsurer's  share of surrenders and
          benefits on losses paid by the Company  pursuant to the  provisions of
          the policies reinsured under the Reinsurance Agreement;


<PAGE>

     c)   to fund an account with the Company in an amount at least equal to the
          deduction,  for reinsurance ceded, from the Company's  liabilities for
          policies reinsured under the Reinsurance Agreement. Such account shall
          include, but not be limited to, amounts for policy reserves,  reserves
          for  claims and  losses  incurred,  loss  adjustments,  expenses,  and
          unearned premiums; and

     d)   to pay  any  other  amounts  the  Company  claims  are due  under  the
          Reinsurance Agreement.

5.   The  Reinsurer  may be given the right to seek approval from the Company to
     withdraw  from the trust  account  all or any part of the assets  contained
     therein and transfer such assets to the Reinsurer, provided:

     a)   The  Reinsurer  shall,  at the time of such  withdrawal,  replace  the
          withdrawn  assets with other  qualified  assets  having a market value
          equal to the market value of the assets withdrawn so as to maintain at
          all times the deposit in the required amount; or

     b)   after such  withdrawals  and  transfer,  the market value of the trust
          account is no less than 102 percent of the required amount.

6.   The  Company  shall  be the  sole  judge  as to  the  application  of  this
     provision,  but shall not unreasonably or arbitrarily withhold its approval
     and provide for:

     a)   the return of any  amount  withdrawn  in excess of the actual  amounts
          required for subparagraphs  (4), (a)-(c) of this Amendment,  or in the
          case of  subparagraph  (4),  (d),  any amounts  that are  subsequently
          determined not to be due; and

     b)   interest  payments  at a rate  not in  excess  of the  prime  rate  of
          interest,  on the amounts held  pursuant to  subparagraph  (4), (c) of
          this Amendment.

7.   Any  arbitration  panel or court of competent  jurisdiction  may permit the
     award of:

     a) interest at a rate different from that provided in subparagraph (6), (b)
        of this Amendment;
     b) court or arbitration  costs;
     c) attorney's fees; and
     d) any other reasonable expenses.


Except as herein  specified,  all of the terms and  conditions  of the  existing
Reinsurance  Agreements  between the Reinsurer and the Company shall continue to
apply,  and this  Amendment  shall be  attached  to and made  part of each  such
Reinsurance Agreement.


<PAGE>

In witness whereof; the parties hereto have caused this Amendment to be executed
in duplicate by their duly authorized representatives:


Security-Connecticut Life Insurance Company


By: /s/  William Casill
    ---------------------------------------


Title:   Vice President and Actuary
    ---------------------------------------

Attest:  /s/  Paul V. Susi
         ----------------------------------

Title:        A.V.P. & Assoc. Actuary
         ----------------------------------


Lincoln Security Life Insurance Company


By: /s/ Robert J. Voight
    ---------------------------------------

Title:  Vice President
    ---------------------------------------

Attest: /s/  John Lockhart
        -----------------------------------

Title:       Assistant Controller, Assistant
             Treasurer
        -----------------------------------


<PAGE>

                                 AMENDMENT IX

                              Effective May 1, 1996


Amendment to Reinsurance Agreement (effective April 1, 1984) between the Lincoln
Security Life Insurance Company,  hereinafter referred to as the "Company",  and
Security-Connecticut  Life  Insurance  Company,  hereinafter  referred to as the
"Reinsurer".

It is hereby agreed that on and after the first day of May 1996, under the above
mentioned reinsurance agreement,  Article I, paragraph 5, shall be replaced with
the following:


                        Exceptions to Automatic Coverage

5.   Reinsurance  shall not be ceded  automatically  on any policy issued on and
     after April 1, 1996, if:

     a.   The amount of life  insurance  in force on that life in all  companies
          plus the amount  currently  being  applied for, less the amount of all
          policies  absolutely  assigned to the Company (provided the sum of all
          such absolute  assignments  does not exceed twenty million dollars for
          issue age of lives up to age 70 and ten million  dollars for issue age
          of  lives  at  or  over  age  70)  exceeds  twenty   million   dollars
          ($20,000,000)  for  issue  age of lives  up to age 70 and ten  million
          dollars ($10,000,000) for issue age of lives at or over age 70; or

     b.   if the amount of insurance  currently  applied for and to be reinsured
          under this Agreement on that life, plus all amounts of insurance which
          the Company then  reinsures  on that life under this  Agreement or any
          other  life  reinsurance  agreement,   exceed  the  Automatic  Binding
          Capacity, as indicated in Exhibit I; or

     c.   the substandard  mortality  rating assessed by the Company to the risk
          exceeds Class P (500%) or its equivalent on an extra premium basis; or

     d.   the  Company  has  submitted  the risk for  facultative  consideration
          within the last two years.



<PAGE>



Except as herein  specified,  all the terms and  conditions  of the  Reinsurance
Agreement shall apply, and this amendment is to be added to and make part of the
aforesaid Agreement.


Security-Connecticut Life Insurance Company

By: /s/  William Casill
    ---------------------------------------
         William Casill

Title:   Vice President and Actuary
    ---------------------------------------

Attest:

By: /s/  Paul V. Susi
    ---------------------------------------

Title:   Assistant Vice President and Assoc.
         Actuary
    ---------------------------------------


Lincoln Security Life Insurance Company

By: /s/ Barry St. Pierre
    ---------------------------------------

Title:  Senior Vice President
    ---------------------------------------

Attest:

By: /s/  J. Paul Chhabra
    ---------------------------------------

Title:   Vice President and Actuary
    ---------------------------------------



<PAGE>



                                   AMENDMENT X

                             Effective July 7, 1997


Amendment to the  Reinsurance  Agreement  (effective  April 1, 1984) between the
Lincoln  Security  Life  Insurance  Company,  hereinafter  referred  to  as  the
"Company", and Security-Connecticut  Life Insurance,  hereinafter referred to as
the "Reinsurer".

It is hereby  agreed,  for all  policies  issued on and after the seventh day of
July 1997, under the above mentioned reinsurance agreement, Exhibit II - Part 5,
will be amended with the attached.


Security-Connecticut Life Insurance Company

By: /s/  William Casill
    ---------------------------------------

Title:   Vice President and Actuary
   ----------------------------------------

Attest:  /s/  Bruce Loughran
         ----------------------------------

Title:        Second V.P. and Actuary
         ----------------------------------


Lincoln Security Life Insurance Company

By: /s/ Robert J. Voight
    ---------------------------------------

Title:  Vice President
    ---------------------------------------

Attest: /s/  John Lockhart
        -----------------------------------

Title:       Assistant Controller/Assistant
             Treasurer
        -----------------------------------


<PAGE>



                                  MULTIPLE LIFE
                              REINSURANCE PREMIUMS

<PAGE>

                               EXHIIT II - PART 5

                              ESTATE DESIGN SERIES
                     FIFTEEN YEAR SELECT REINSURANCE PROGRAM

                                                          Effective July 7, 1997

USE OF THE RATE SCHEDULE

The appropriate YRT premium shall be derived by applying the following multiples
to the rates combined herein:

<TABLE>
<S>           <C>       <C>         <C>         <C>         <C>        <C>         <C>        <C>         <C>

               NS/NS
 JEA           0-37      38-42      43-45       46-47       48-52      53-57       58-62       63-70       71+
             ------------------------------------------------------------------------------------------------------
             ------------------------------------------------------------------------------------------------------
                                                   DUR
1             0         0           0           0           0          0           0           0           0
2-10          0.31     2-10        0.28        0.25        0.18        0.17       0.16        0.16        0.16
11-14         0.29     0.26        0.23        0.18        0.17       0.16        0.16        0.16        0.18
15            0.65     0.59        0.53        0.41        0.39       0.38        0.38        0.38        0.40
16            0.63     0.57        0.51        0.41        0.39       0.38        0.38        0.38        0.40
17-20         0.63     0.57        0.51        0.41        0.39       0.38        0.38        0.38        0.40
21+           0.43     0.40        0.37        0.27        0.26       0.26        0.26        0.26        0.26

               NS/S
 JEA           0-37      38-42       43-45       46-47       48-52      53-57       58-62       63-70       71+
             ------------------------------------------------------------------------------------------------------
                                                   DUR
1              0         0           0           0 1         0          0           0           0           0
2-10           0.31     0.28        0.25        0.18        0.17       0.16        0.16        0.16        0.12
11-14          0.29     0.26        0.23        0.18        0.17       0.16        0.16        0.16        0.12
15             0.65     0.59        0.53        0.41        0.39       0.38        0.38        0.38        0.28
16             0.63     0.57        0.51        0.41        0.39       0.38        0.38        0.38        0.28
17-20          0.63     0.57        0.51        0.41        0.39       0.38        0.38        0.38        0.28
21+            0.43     0.40        0.37        0.27        0.27       0.26        0.26        0.26        0.21


               S/S
 JEA           0-37      38-42       43-45       46-47       48-52      53-57       58-62       63-70       71+
             ------------------------------------------------------------------------------------------------------
                                                   DUR
1              0         0           0           0 1         0          0           0           0           0
2-10           0.31    0.28        0.25        0.18        0.17       0.16        0.16        0.16        0.18
11-14          0.29    0.26        0.23        0.18        0.17       0.16        0.16        0.16        0.18
15             0.66    0.60        0.54        0.42        0.40       0.39        0.39        0.39        0.41
16             0.64    0.58        0.52        0.42        0.40       0.39        0.39        0.39        0.41
17-20          0.64    0.58        0.52        0.42        0.40       0.39        0.39        0.39        0.41
21+            0.44    0.41        0.38        0.28        0.28       0.27        0.27        0.27        0.28

</TABLE>

<PAGE>


                             Guaranteed Annuity COIs


Table omitted.

<PAGE>


SUBSTANDARD RISKS
-----------------

A table  rating on either or both lives  will be  converted  into a joint  table
rating or a joint flat extra or a  combination  of the two.  For the joint table
rating portion of the risk, the total  reinsurance  premium will be equal to the
standard  reinsurance premium increased by a proportional  amount. For the joint
flat extra portion of the risk associated with the individual  table  rating(s),
the total  reinsurance  premium will be increased by the joint flat extra. For a
joint  flat  extra  attributable  to a flat  extra  rating on one or both of the
individuals, the total reinsurance premium will be determined in accordance with
paragraph 2 or 3 of Article VI, as appropriate.


POLICY FEE

None.


<PAGE>



                                  AMENDMENT XI

                             Effective April 1, 2000

Amendment  to the  Automatic  Reinsurance  Agreement  (effective  April 1, 1984)
between ReliaStar Life Insurance Company of New York hereinafter  referred to as
the "Company",  and  Security-Connecticut  Life Insurance  Company,  hereinafter
referred to as the "Reinsurer".

It is hereby  agreed  that on and after the first day of April  2000,  under the
above mentioned reinsurance agreement,  Exhibit II, Part 2, will be amended with
the attached.

It is hereby  agreed  that on and after the first day of April  2000,  under the
above mentioned  reinsurance  agreement,  Exhibit III, will be replaced with the
attached with the appropriate effective dates.

Except  as hereby  specified,  all the terms  and  conditions  of the  Automatic
Reinsurance  Agreement  shall apply,  and the amendment is to be attached to and
made part of aforesaid Agreement.

                   Security-Connecticut Life Insurance Company


  Attest: /s/  Diane Sylvester            By: /s/  Paul V. Susi
              -----------------------         -----------------------------

  Title:       2nd Vice President         Title:   2nd Vice President & Actuary


                        ReliaStar Life Insurance Company


  Attest: /s/  William Bonneville         By: /s/ Fritz Riemenschneider
          ---------------------------         -----------------------------

  Title:       Exec. Vice President       Title:  Assistant Vice President &
               ----------------------             Compliance Officer
                                              -----------------------------



<PAGE>



                              Reinsurance Premiums



Table omitted.

<PAGE>

                               EXHIBIT II - Part 2

                     Fifteen Year Select Reinsurance Program
                              Reinsurance Premiums


Duration         SPNS          PNS           SNS          PSM           SSM
--------         ----          ---           ---          ---           ---
   1             .00           .00           .00          .00           .00
   2 +           .36           .46           .60          .46           .62



Female Rates:

Age 0 - Use rates for males issue age 0
Ages 1 to 5 - Use rates for males issue age 1
Ages 6 and older Use rates for males 5 years younger

Female risks are subject to the maximum true issue age limit of 85.


Substandard Risks:

The  reinsurance  premiums for substandard  risks rated on a multiple  mortality
tables basis shall be equal to the multiple of the standard  rate  proportionate
to the mortality classification. Thus, the premium for class D (200%) risk shall
be equal to twice the standard premium.


Policy Fee:  None.



<PAGE>



                                  AMENDMENT XVI

                           Effective September 1, 1998

Amendment  to the  Reinsurance  Agreement  (effective  April  1,  1984)  between
ReliaStar Life Insurance  Company of New York,  formally  Lincoln  Security Life
Insurance   Company,   hereinafter   referred   to   as   the   "Company",   and
Security-Connecticut  Life  Insurance  Company,  hereinafter  referred to as the
"Reinsurer".

It is hereby  agreed that  effective  on and after the first day of September I,
1998, under the above mentioned Reinsurance Agreement, Exhibit I is amended with
the attached.

Except as herein  specified,  all the terms and  conditions  of the  Reinsurance
Agreement shall apply, and this amendment is to be added to and made part of the
aforesaid Agreement.


Security-Connecticut Life Insurance Company

By: /s/  Bruce Loughran
    ---------------------------------------

Title:   Second V.P. and Actuary
    ---------------------------------------

Attest:
        -----------------------------------

By: /s/  Eric Swan
    ---------------------------------------

Title:   Assistant Actuary
    ---------------------------------------


ReliaStar Life Insurance Company of New York

By: /s/  William Bonneville
    ---------------------------------------

Title:   Executive Vice President
    ---------------------------------------

Attest:
        -----------------------------------

By: /s/  Kenneth Quenstedt
    ---------------------------------------

Title:   AVP - IS
    ---------------------------------------


<PAGE>



                                    EXHIBIT I

                           Effective September 1, 1998



                 RETENTION LIMITS APPLICABLE TO PERMANENT POOL:

                                    $300,000




                 AUTOMATIC BINDING APPLICABLE TO PERMANENT POOL:


                                   $6,000,000


<PAGE>



                                 AMENDMENT XVII

                           Effective November 1, 2001


Amendment  to the  Reinsurance  Agreement  (effective  April  1,  1984)  between
ReliaStar Life Insurance  Company of New York,  formally  Lincoln  Security Life
Insurance   Company,   hereinafter   referred   to   as   the   "Company",   and
Security-Connecticut  Life  Insurance  Company,  hereinafter  referred to as the
"Reinsurer".


It is hereby  agreed  that  effective  on and after the first day of November 1,
2001, the above mentioned Reinsurance Agreement is amended as follows:


     1. Article I, paragraph 2, is amended for policies  issued on and after the
effective date of this Amendment, as follows:

     Except as specified in Paragraph 5,  whenever  coverage is available  under
     this Agreement,  as specified in Paragraph l of this Article I, the Company
     shall cede and the Reinsurer shall automatically accept the excess over the
     Company's  designated maximum retention up to the maximum automatic binding
     limits  specified in Exhibit I. In addition,  it is agreed that Company may
     enter into  reinsurance  arrangements  whereby  Company  will cede risks to
     certain  reinsurers  on a first  dollar  quota  share basis prior to ceding
     Company's  excess  retention  to  Reinsurer.  To the extent  the  Company's
     designated maximum retention is exceeded after ceding amounts under a first
     dollar quota  reinsurance  arrangement,  Reinsurer  shall accept amounts in
     excess of Company's retention as provided in this Agreement.


     2. Article I, paragraph 5 is amended to provide that for policies issued on
and after the effective  date of this  Amendment,  the  exceptions for automatic
coverage are (a) for  insurance  resulting  from a group  conversion  where full
evidence  of  insurance  has not been  secured  , and (b) if the  amount of life
insurance in force on that life in all  companies  plus that  currently  applied
for,  less the amount of all  absolutely  assigned to the  Company,  exceeds the
binding limits in Exhibit I.


     3. Article I, paragraph 6, is amended to provide that there is no
maximum Automatic Limit or maximum for conditional receipt coverage for policies
issued on and after the effective date of this Amendment.


     4. Exhibit I is amended with the attached.


     5. The reinsurance  rates set forth in Exhibit II is amended to include the
attached rates which shall apply to policies  issued after the effective date of
this Amendment.

     6.  Exhibit III is replaced by the  attached  Plans of  Insurance  with the
appropriate  effective  dates.  In addition,  it is agreed that all new plans of
Company's permanent  insurance,  including variable products,  shall be eligible
plans of  insurance  to be ceded under this  Reinsurance  Agreement,  unless the
Reinsurer  elects in writing  not to  participate  in the  coverage  for a newly
designed  permanent  term plan  within 20 days after  receiving  requisite  plan
information  which  Company  must provide to Reinsurer at least 25 days prior to
commencing  cessions  to  Reinsurer.  Such new plans  shall use the  appropriate
reinsurance  rates  then  being  used  for  new  policies  reinsured  under  the
Reinsurance  Agreement,  unless  the  parties  amend this  Agreement  in writing
providing  another set of reinsurance rates to be applicable for the new plan of
insurance.

Except as herein  specified,  all the terms and  conditions  of the  Reinsurance
Agreement shall apply, and this amendment is to be added to and made part of the
aforesaid Agreement.



Security-Connecticut Life Insurance Company

By: /s/  Bruce Loughran
    ---------------------------------------

Title:   Second V.P. and Actuary
    ---------------------------------------

Attest:
        -----------------------------------

By: /s/  Eric Swan
    ---------------------------------------

Title:   Assistant Actuary
    ---------------------------------------



ReliaStar Life Insurance Company of New York

By: /s/  William Bonneville
    ---------------------------------------

Title:   Executive Vice President
    ---------------------------------------

Attest:
         ----------------------------------

By: /s/  Kenneth Quenstedt
    ---------------------------------------

Title:   AVP - IS
    ---------------------------------------



<PAGE>


                                    EXHIBIT I

                           Effective November 1, 2001



                 RETENTION LIMITS APPLICABLE TO PERMANENT POOL:


                                    $300,000




                 AUTOMATIC BINDING APPLICABLE TO PERMANENT POOL:


                  Automatic Binding Capacity - Individual Life


<TABLE>
<S>                 <C>               <C>               <C>               <C>               <C>

------------------- ----------------- ----------------- ----------------- ----------------- -----------------
      Rating          Ages - 0-75          Rating         Ages - 76-80         Rating         Ages - 81-85
------------------- ----------------- ----------------- ----------------- ----------------- -----------------
     Standard          50,000,000         Standard         30,000,000         Standard         25,000,000
------------------- ----------------- ----------------- ----------------- ----------------- -----------------
   Table 1 - 6         50,000,000        Table 1-4         30,000,000        Table 1-2         25,000,000
------------------- ----------------- ----------------- ----------------- ----------------- -----------------
   Table 7 - 16        35,000,000       Tables 5-16            0             Table 3-16            0
------------------- ----------------- ----------------- ----------------- ----------------- -----------------

</TABLE>


<TABLE>
<S>                  <C>                          <C>               <C>                        <C>             <C>

              Automatic Binding Capacity - Survivorship/Joint Life*

--------------------- --------------------------- ----------------- -------------------------- --------------- -------------------
       Rating             Oldest Ages - 0-75           Rating          Oldest Age - 76-80          Rating        Oldest Ages -
                                                                                                                     81-85
--------------------- --------------------------- ----------------- -------------------------- --------------- -------------------
      Standard                50,000,000              Standard             30,000,000             Standard         25,000,000
--------------------- --------------------------- ----------------- -------------------------- --------------- -------------------
    Table 1 - 6               50,000,000             Table 1-4             30,000,000            Table 1-2         25,000,000
--------------------- --------------------------- ----------------- -------------------------- --------------- -------------------
      Table 7+                35,000,000             Tables 5+                  0                 Table 3+             0
--------------------- --------------------------- ----------------- -------------------------- --------------- -------------------

</TABLE>

*Refer to Individual  Life  Automatic  Binding  Capacity  Chart when one life is
 uninsurable.


<PAGE>



                                   EXHIBIT II


                                Reinsurance Rates


              Super
            Preferred       Preferred      Standard      Preferred     Standard
Duration   Non-Tobacco     Non-Tobacco    Non-Tobacco     Tobacco       Tobacco

1             .00             .00            .00            .00           .00

2+            .90             .94           1.02           1.09          1.19


<PAGE>



                                   EXHIBIT III

                               Plans of Insurance


Omitted.

<PAGE>



                                 AMENDMENT XVIII


                            Effective October 1, 2003

Amendment XVIII to the Automatic Reinsurance Agreement, effective April 1, 1984,
between  Security-Connecticut  Life Insurance Company  (Reinsurer) and ReliaStar
Life Insurance Company of New York (Company).

Effective October 1, 2003,  Security-Connecticut Life Insurance Company has been
merged with  ReliaStar  Life  Insurance  Company and  thereafter  ReliaStar Life
Insurance  Company  will assume all the  business of  Security-Connecticut  Life
Insurance Company reinsured under the Automatic  Reinsurance Agreement effective
April 1, 1984 between  Security-Connecticut Life Insurance Company and ReliaStar
Life Insurance Company of New York.

All of the rights accorded to and duties, obligations and liabilities assumed by
Security-Connecticut  Life  Insurance  Company  under  the  Agreement  shall  be
accorded to and assumed by ReliaStar Life Insurance Company as if ReliaStar Life
Insurance  Company  had been the  original  party to the  Reinsurance  Agreement
instead of Security-Connecticut Life Insurance Company.

The terms and  conditions  of the Agreement are not changed in any way except as
stated herein.

Amendment  XVIII shall  inure to the benefit of and be binding  upon the parties
hereto and their respective successors and assigns.

In witness of the above,  ReliaStar  Life and ReliaStar Life of New York have by
their  respective  officers  executed  and  delivered  this  Amendment  XVIII in
duplicate on the dates  indicated  below,  with an Effective  Date of October 1,
2003.


RELIASTAR LIFE INSURANCE COMPANY             RELIASTAR LIFE INSURANCE COMPANY
                                                OF NEW YORK

By: /s/  Richard Lau                         By: /s/  Richard Lau
    ----------------------------                 -------------------------------
         Richard Lau                                  Richard Lau

Title:   Vice President                      Title:   Vice President
    ----------------------------                 -------------------------------

Date:    2/25/04                             Date:    2/25/04
    ----------------------------                 -------------------------------

Attest: /s/  Mary Broesch                    Attest:  /s/  Mary Broesch
        ------------------------                      --------------------------
             Mary Broesch                                  Mary Broesch

Title:       Vice President                  Title:        Vice President
             -------------------                           ---------------------

Date:        2/25/04                         Date:         2/25/04
             -------------------                           ---------------------


<PAGE>

                                  AMENDMENT XIX

                             Effective March 1, 2001


Amendment XIX to the Automatic Reinsurance  Agreement,  effective April 1, 1984,
between  ReliaStar  Life  Insurance  Company   (Reinsurer)  and  ReliaStar  Life
Insurance Company of New York (Company).

It is hereby  agreed  that  effective  on and after the March 1, 2001  under the
above mentioned Reinsurance Agreement, Exhibit III is amended with the attached.

Except as herein  specified,  all the terms and  conditions  of the  Reinsurance
Agreement shall apply, and this Amendment is to be added to and made part of the
aforesaid Agreement.

In witness of the above,  ReliaStar  Life and ReliaStar Life of New York have by
their respective officers executed and delivered this Amendment XIX in duplicate
on the dates indicated below, with an Effective Date of March 1, 2001.


RELIASTAR LIFE INSURANCE COMPANY             RELIASTAR LIFE INSURANCE COMPANY
                                                OF NEW YORK

By: /s/  Richard Lau                         By: /s/  Richard Lau
    ----------------------------                 -------------------------------
         Richard Lau                                  Richard Lau

Title:   Vice President                      Title:   Vice President
    ----------------------------                 -------------------------------

Date:    2/25/04                             Date:    2/25/04
    ----------------------------                 -------------------------------

Attest: /s/  Mary Broesch                    Attest:  /s/  Mary Broesch
        ------------------------                      --------------------------
             Mary Broesch                                  Mary Broesch

Title:       Vice President                  Title:        Vice President
             -------------------                           ---------------------

Date:        2/25/04                         Date:         2/25/04
             -------------------                           ---------------------




<PAGE>


                                   EXHIBIT III

                               Plans of Insurance



<TABLE>
<S>         <C>                       <C>                           <C>                      <C>

            Plan Name                 Policy Form Number            Effective Date           Termination Date
--------------------------------------------------------------------------------------------------------------------
Economy Life                                10640NY                  April 1, 1984
--------------------------------------------------------------------------------------------------------------------
Security 21                                 10780NY                  April 1, 1984           April 1, 1990
--------------------------------------------------------------------------------------------------------------------
One/Five Year R&C                           10860NY                  April 1, 1984
--------------------------------------------------------------------------------------------------------------------
Life Paid Up at 95                          10850NY                  April 1, 1984
--------------------------------------------------------------------------------------------------------------------
Designer Life                               10840NY                  April 1, 1984
--------------------------------------------------------------------------------------------------------------------
Designer Life Plus                          10890NY                  October 1, 1985         December 1, 1987
--------------------------------------------------------------------------------------------------------------------
Designer Life III                           10980NY                  August 1, 1985          December 1, 1987
--------------------------------------------------------------------------------------------------------------------
New Life II/Plus                            10960NY                  February 1, 1986        December 1, 1987
--------------------------------------------------------------------------------------------------------------------
New Life I                                  10970NY                  February 1, 1986        December 1, 1987
--------------------------------------------------------------------------------------------------------------------
Premier Design                              11060NY                  January 1, 1988
--------------------------------------------------------------------------------------------------------------------
Guarantee Life                              11220NY                  January 1, 1991
--------------------------------------------------------------------------------------------------------------------
Joint Design                                11260NY                  June 1, 1992
--------------------------------------------------------------------------------------------------------------------
Estate Design                               11400NY                  November 1, 1992
--------------------------------------------------------------------------------------------------------------------
Design UL                                B-UL-1195-97                April 1, 2000
--------------------------------------------------------------------------------------------------------------------
Variable Estate Design NY                   85-438                   February 1, 2001
--------------------------------------------------------------------------------------------------------------------
Select Life NY II                           86-025                   March 1, 2001
--------------------------------------------------------------------------------------------------------------------
Design UL (2001)                           1132R NY                  March 1, 2001
--------------------------------------------------------------------------------------------------------------------

</TABLE>

<PAGE>


                                  AMENDMENT XX

                           Effective February 1, 2002


Amendment XX to the Automatic  Reinsurance  Agreement,  effective April 1, 1984,
between  ReliaStar  Life  Insurance  Company   (Reinsurer)  and  ReliaStar  Life
Insurance Company of New York (Company).

It is hereby  agreed that  effective on and after the February 1, 2002 under the
above mentioned Reinsurance Agreement, Exhibit III is amended with the attached.

Except as herein  specified,  all the terms and  conditions  of the  Reinsurance
Agreement shall apply, and this Amendment is to be added to and made part of the
aforesaid Agreement.

In witness of the above, ReliaStar Life and ReliaStar Life of New York have by
their respective officers executed and delivered this Amendment XX in duplicate
on the dates indicated below, with an Effective Date of February 1, 2002.


RELIASTAR LIFE INSURANCE COMPANY             RELIASTAR LIFE INSURANCE COMPANY
                                                OF NEW YORK

By: /s/  Richard Lau                         By: /s/  Richard Lau
    ----------------------------                 -------------------------------
         Richard Lau                                  Richard Lau

Title:   Vice President                      Title:   Vice President
    ----------------------------                 -------------------------------

Date:    6/11/04                             Date:    6/11/04
    ----------------------------                 -------------------------------

Attest: /s/  Mary Broesch                    Attest:  /s/  Mary Broesch
        ------------------------                      --------------------------
             Mary Broesch                                  Mary Broesch

Title:       Vice President                  Title:        Vice President
             -------------------                           ---------------------

Date:        6/11/04                         Date:         6/11/04
             -------------------                           ---------------------


<PAGE>


                                   EXHIBIT III

                               Plans of Insurance



Omitted.

<TABLE>
<S>         <C>                        <C>                          <C>                       <C>


---------------------------------------------------------------------------------------------------------------------
            Plan Name                  Policy Form Number           Effective Date            Termination Date
---------------------------------------------------------------------------------------------------------------------
Economy Life                                10640NY                 April 1, 1984
---------------------------------------------------------------------------------------------------------------------
Security 21                                 10780NY                 April 1, 1984             April 1, 1990
---------------------------------------------------------------------------------------------------------------------
One/Five Year R&C                           10860NY                 April 1, 1984
---------------------------------------------------------------------------------------------------------------------
Life Paid Up at 95                          10850NY                 April 1, 1984
---------------------------------------------------------------------------------------------------------------------
Designer Life                               10840NY                 April 1, 1984
---------------------------------------------------------------------------------------------------------------------
Designer Life Plus                          10890NY                 October 1, 1985           December 1, 1987
---------------------------------------------------------------------------------------------------------------------
Designer Life III                           10980NY                 August 1, 1985            December 1, 1987
---------------------------------------------------------------------------------------------------------------------
New Life II/Plus                            10960NY                 February 1, 1986          December 1, 1987
---------------------------------------------------------------------------------------------------------------------
New Life I                                  10970NY                 February 1, 1986          December 1, 1987
---------------------------------------------------------------------------------------------------------------------
Premier Design                              11060NY                 January 1, 1988
---------------------------------------------------------------------------------------------------------------------
Guarantee Life                              11220NY                 January 1, 1991
---------------------------------------------------------------------------------------------------------------------
Joint Design                                11260NY                 June 1, 1992
---------------------------------------------------------------------------------------------------------------------
Estate Design                               11400NY                 November 1, 1992
---------------------------------------------------------------------------------------------------------------------
Design UL                                 B-UL-1195-97              April 1, 2000
---------------------------------------------------------------------------------------------------------------------
Variable Estate Design NY                    85-438                 February 1, 2001
---------------------------------------------------------------------------------------------------------------------
Select Life NY II                            86-025                 March 1, 2001
---------------------------------------------------------------------------------------------------------------------
Design UL (2001)                            1132R NY                March 1, 2001
---------------------------------------------------------------------------------------------------------------------
Premier Design                              1135R NY                February 1, 2002
---------------------------------------------------------------------------------------------------------------------

</TABLE>

<PAGE>



                                  AMENDMENT XXI

                              Effective May 1, 2004

Amendment XIX to the Automatic Reinsurance  Agreement,  effective April 1, 1484,
between  ReliaStar  Life  Insurance  Company   (Reinsurer)  and  ReliaStar  Life
Insurance Company of New York (Company).

The parties hereby agree to append Exhibit I of the above  referenced  agreement
for new business written on or after May 1, 2004 as follows:

A.   Automatic Binding Limits

                       Aviation* and Professional Sports Risks
 -------------------------------------------------------------------------------
        Rating            Ages 0-75          Ages 76-80         Ages 81-85
 -------------------------------------------------------------------------------
       Standard          $25,000,000        $15,000,000         $12,500,000
 -------------------------------------------------------------------------------
      Tables 1-2         $25,000,000        $15,000,000         $12,500,000
 -------------------------------------------------------------------------------
      Tables 3-4         $25,000,000        $15,000,000             $0
 -------------------------------------------------------------------------------
      Tables 5-6         $25,000,000             $0                 $0
 -------------------------------------------------------------------------------
      Tables 7-16         $17,500,000            $0                 $0
 -------------------------------------------------------------------------------

*Aviation Exclusion Rider (AER) required for ages under l6 and above 75.

The parties  hereby agree to amend Exhibit I of the above  referenced  agreement
for new business written on or after May 1, 2004 as follows:

B.   Jumbo Limit

As it is known to Company at issue, the total then inforce plus the total amount
applied for, using the largest  scheduled  death benefit applied for on the life
may not be in excess of $65,000,000 on any one life.

Except as herein  specified,  all the terms and  conditions  of the  Reinsurance
Agreement shall apply, and this Amendment is to be added to and made part of the
aforesaid Agreement.

In witness of the above,  ReliaStar  Life and ReliaStar Life of New York have by
their respective officers executed and delivered this Amendment XXI in duplicate
on the dates indicated below, with an Effective

RELIASTAR LIFE INSURANCE COMPANY             RELIASTAR LIFE INSURANCE COMPANY
                                                OF NEW YORK

By: /s/  Richard Lau                         By: /s/  Richard Lau
    ----------------------------                 -------------------------------
         Richard Lau                                  Richard Lau

Title:   Vice President                      Title:   Vice President
    ----------------------------                 -------------------------------

Date:    6/17/04                             Date:    6/17/04
    ----------------------------                 -------------------------------

Attest: /s/  Mary Broesch                    Attest:  /s/  Mary Broesch
        ------------------------                      --------------------------
             Mary Broesch                                  Mary Broesch

Title:       Vice President                  Title:        Vice President
             -------------------                           ---------------------

Date:        6/17/04                         Date:         6/17/04
             -------------------                           ---------------------


<PAGE>



                                 AMENDMENT XXII

                             Effective June 30, 2004


Amendment XXII to the Automatic Reinsurance Agreement,  effective April 1, 1984,
between  ReliaStar  Life  Insurance  Company   (Reinsurer)  and  ReliaStar  Life
Insurance Company of New York (Company).

It is hereby  agreed  that  effective  on and after the June 30,  2004 under the
above mentioned Reinsurance Agreement, Exhibit III is amended with the attached.

Except as herein  specified,  all the terms and  conditions  of the  Reinsurance
Agreement shall apply, and this Amendment is to be added to and made part of the
aforesaid Agreement.

In witness of the above,  ReliaStar  Life and ReliaStar Life of New York have by
their  respective  officers  executed  and  delivered  this  Amendment  XXII  in
duplicate on the dates indicated below, with an Effective Date of June 30, 2004.

RELIASTAR LIFE INSURANCE COMPANY             RELIASTAR LIFE INSURANCE COMPANY
                                                OF NEW YORK

By: /s/  Richard Lau                         By: /s/  Richard Lau
    ----------------------------                 -------------------------------
         Richard Lau                                  Richard Lau

Title:   Vice President                      Title:   Vice President
    ----------------------------                 -------------------------------

Date:    July 16, 2004                       Date:    July 16, 2004
    ----------------------------                 -------------------------------

Attest: /s/  Mary Broesch                    Attest:  /s/  Mary Broesch
        ------------------------                      --------------------------
             Mary Broesch                                  Mary Broesch

Title:       Vice President                  Title:        Vice President
             -------------------                           ---------------------

Date:        7/16/04                         Date:         7/16/04
             -------------------                           ---------------------


<PAGE>



                                   EXHIBIT III


                               Plans of Insurance

<TABLE>
<S>          <C>                         <C>                          <C>                      <C>

-----------------------------------------------------------------------------------------------------------------------
             Plan Name                   Policy Form Number           Effective Date           Termination Date
-----------------------------------------------------------------------------------------------------------------------
Economy Life                                  I0640NY                 April 1, 1984
-----------------------------------------------------------------------------------------------------------------------
Security 21                                   10780NY                 April 1, 1984            April 1, 1990
-----------------------------------------------------------------------------------------------------------------------
One/Five Year R&C                             10860NY                 April 1, 1984
-----------------------------------------------------------------------------------------------------------------------
Life Paid Up at 95                            I0850NY                 April 1, 1984
-----------------------------------------------------------------------------------------------------------------------
Designer Life                                 10840NY                 April 1, 1984
-----------------------------------------------------------------------------------------------------------------------
Designer Life Plus                            10890NY                 October 1, 1985          December 1, 1987
-----------------------------------------------------------------------------------------------------------------------
Designer Life Ill                             10980NY                 August 1, 1985           December 1, 1987
-----------------------------------------------------------------------------------------------------------------------
New Life II/Plus                              10960NY                 February 1, 1986         December 1, 1987
-----------------------------------------------------------------------------------------------------------------------
New Life I                                    10970NY                 February 1, 1986         December 1, 1987
-----------------------------------------------------------------------------------------------------------------------
Premier Design                                11060NY                 January I, 1988
-----------------------------------------------------------------------------------------------------------------------
Guarantee Life                                11220NY                 January 1, 1991
-----------------------------------------------------------------------------------------------------------------------
Joint Design                                  11260NY                 June 1, 1992
-----------------------------------------------------------------------------------------------------------------------
Estate Design                                 11400NY                 November 1, 1992
-----------------------------------------------------------------------------------------------------------------------
Design UL                                   B-UL-1195-97              April 1, 2000
-----------------------------------------------------------------------------------------------------------------------
Variable Estate Design NY                      85-438                 February 1, 2001
-----------------------------------------------------------------------------------------------------------------------
Select Life NY II                              86-025                 March 1, 2001
-----------------------------------------------------------------------------------------------------------------------
Design UL (2001)                              1132R NY                March 1, 2001
-----------------------------------------------------------------------------------------------------------------------
Premier Design                                1135R NY                February 1, 2002
-----------------------------------------------------------------------------------------------------------------------
GPUL                                          1175R NY                June 30, 2004
-----------------------------------------------------------------------------------------------------------------------

</TABLE>

<PAGE>


                                 AMENDMENT XXIII

                            Effective October 1, 2004


Amendment XXIII to the Automatic Reinsurance Agreement, effective April 1, 1984,
between  ReliaStar  Life  Insurance  Company   (Reinsurer)  and  ReliaStar  Life
Insurance Company of New York (Company).

It is hereby  agreed that  effective  on and after the October 1, 2004 under the
above mentioned Reinsurance Agreement, Exhibit III is amended with the attached.

Except as herein  specified,  all the terms and  conditions  of the  Reinsurance
Agreement shall apply, and this Amendment is to be added to and made part of the
aforesaid Agreement.

In witness of the above,  ReliaStar  Life  Insurance  Company and ReliaStar Life
Insurance  Company of New York have by their  respective  officers  executed and
delivered this Amendment XXIII in duplicate on the dates indicated  below,  with
an Effective Date of October 1, 2004.


RELIASTAR LIFE INSURANCE COMPANY             RELIASTAR LIFE INSURANCE COMPANY
                                                OF NEW YORK

By: /s/ Richard Lau                          By: /s/  Richard Lau
    ----------------------------                 -------------------------------
        Richard Lau                                   Richard Lau

Title:  Vice President & Actuary             Title:   Vice President & Actuary
    ----------------------------                 -------------------------------

Date:   10/08/04                             Date:    10/08/04
    ----------------------------                 -------------------------------

Attest: /s/  Mary Broesch                    Attest:/s/ Mary Broesch
        ------------------------                      --------------------------
             Mary Broesch                               Mary Broesch

Title:       Vice President & Actuary        Title:     Vice President & Actuary
             ------------------------                   ------------------------

Date:        10/08/04                         Date:        10/08/04
             -------------------                           ---------------------



<PAGE>



                                   EXHIBIT III

                               Plans of Insurance

<TABLE>
<S>          <C>                          <C>                             <C>                       <C>

----------------------------------------------------------------------------------------------------------------------------
             Plan Name                    Policy Form Number              Effective Date            Termination Date
----------------------------------------------------------------------------------------------------------------------------
Economy Life                                    10640NY                   April 1, 1984
----------------------------------------------------------------------------------------------------------------------------
Security 21                                     10780NY                   April 1, 1984             April 1, I990
----------------------------------------------------------------------------------------------------------------------------
One/Five Year R&C                               10860NY                   April 1, 1984
----------------------------------------------------------------------------------------------------------------------------
Life Paid Up at 95                              10850NY                   April 1, 1984
----------------------------------------------------------------------------------------------------------------------------
Designer Life                                   10840NY                   April 1, 1984
----------------------------------------------------------------------------------------------------------------------------
Designer Life Plus                              10890NY                   October 1, 1985           December 1, 1987
----------------------------------------------------------------------------------------------------------------------------
Designer Life III                               10980NY                   August 1, 1985            December 1, 1987
----------------------------------------------------------------------------------------------------------------------------
New Life II/Plus                                10960NY                   February 1, 1986          December 1, 1987
----------------------------------------------------------------------------------------------------------------------------
New Life I                                      10970NY                   February 1, 1986          December 1, 1987
----------------------------------------------------------------------------------------------------------------------------
Premier Design                                  11060NY                   January 1, 1988
----------------------------------------------------------------------------------------------------------------------------
Guarantee Life                                  11220NY                   January 1, 1991
----------------------------------------------------------------------------------------------------------------------------
Joint Design                                    11260NY                   June 1, 1992
----------------------------------------------------------------------------------------------------------------------------
Estate Design                                   11400NY                   November 1, 1992
----------------------------------------------------------------------------------------------------------------------------
Design UL                                    B-UL-1195-97                 April 1, 2000
----------------------------------------------------------------------------------------------------------------------------
Variable Estate Design NY                       85-438                    February 1, 2001
----------------------------------------------------------------------------------------------------------------------------
Select Life NY II                               86-025                    March 1, 2001
----------------------------------------------------------------------------------------------------------------------------
Design UL (2001)                               1132R NY                   March 1, 2001
----------------------------------------------------------------------------------------------------------------------------
Premier Design                                 1135R NY                   February 1, 2002
----------------------------------------------------------------------------------------------------------------------------
GPUL                                           1175R NY                   June 30, 2004
----------------------------------------------------------------------------------------------------------------------------
ING Capital Accumulator UL                      131906R                   October 1, 2004
----------------------------------------------------------------------------------------------------------------------------
Investor Elite                                  86-756                    October 1, 2004
----------------------------------------------------------------------------------------------------------------------------
Premier Design                                  86-810                    October 1, 2004
----------------------------------------------------------------------------------------------------------------------------
GPSUL                                           1176NY                    October 1, 2004
----------------------------------------------------------------------------------------------------------------------------

</TABLE>

<PAGE>

                                                                    Exhibit 31.1


                                  CERTIFICATION

I, David A. Wheat, certify that:

1.   I have reviewed this annual report on Form 10-K of ReliaStar Life Insurance
     Company of New York;

2.   Based on my knowledge, this report does not contain any untrue statement of
     a material  fact or omit to state a  material  fact  necessary  to make the
     statements made, in light of the circumstances  under which such statements
     were made,  not  misleading  with  respect  to the  period  covered by this
     report;

3.   Based on my  knowledge,  the  financial  statements,  and  other  financial
     information  included  in  this  report,  fairly  present  in all  material
     respects the financial  condition,  results of operations and cash flows of
     the registrant as of, and for, the periods presented in this report;

4.   The  registrant's  other  certifying  officers  and I are  responsible  for
     establishing and maintaining disclosure controls and procedures (as defined
     in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

     a)   designed  such  disclosure  controls  and  procedures,  or caused such
          disclosure   controls  and   procedures  to  be  designed   under  our
          supervision,  to ensure  that  material  information  relating  to the
          registrant,  including its consolidated subsidiaries, is made known to
          us by others within those entities,  particularly during the period in
          which this report is being prepared;

     b)   evaluated the  effectiveness of the registrant's  disclosure  controls
          and procedures and presented in this report our conclusions  about the
          effectiveness of the disclosure controls and procedures, as of the end
          of the period covered by this report based on such evaluation; and

     c)   disclosed  in this  report  any  change in the  registrant's  internal
          control over financial reporting that occurred during the registrant's
          most recent fiscal quarter (the registrant's  fourth fiscal quarter in
          the case of an annual  report)  that has  materially  affected,  or is
          reasonably  likely to materially  affect,  the  registrant's  internal
          control over financial reporting; and

5.   The registrant's other certifying officer(s) and I have disclosed, based on
     our most recent evaluation of internal control over financial reporting, to
     the registrant's auditors and the audit committee of the registrant's board
     of directors (or persons performing the equivalent functions):

     a)   all significant  deficiencies and material weaknesses in the design or
          operation  of internal  control  over  financial  reporting  which are
          reasonably  likely to  adversely  affect the  registrant's  ability to
          record, process, summarize and report financial information; and

     b)   any fraud, whether or not material,  that involves management or other
          employees who have a  significant  role in the  registrant's  internal
          control over financial reporting.


Date:    March 29, 2005
         -----------------

By       /s/  David A. Wheat
         ----------------------------------------------------------------
              David A. Wheat
              Director, Senior Vice President and Chief Financial Officer
              (Duly Authorized Officer and Principal Financial Officer)

<PAGE>


                                                                    Exhibit 31.2


                                  CERTIFICATION

I, James R. Gelder, certify that:

1.   I have reviewed this annual report on Form 10-K of ReliaStar Life Insurance
     Company of New York;

2.   Based on my knowledge, this report does not contain any untrue statement of
     a material  fact or omit to state a  material  fact  necessary  to make the
     statements made, in light of the circumstances  under which such statements
     were made,  not  misleading  with  respect  to the  period  covered by this
     report;

3.   Based on my  knowledge,  the  financial  statements,  and  other  financial
     information  included  in  this  report,  fairly  present  in all  material
     respects the financial  condition,  results of operations and cash flows of
     the registrant as of, and for, the periods presented in this report;

4.   The  registrant's  other  certifying  officers  and I are  responsible  for
     establishing and maintaining disclosure controls and procedures (as defined
     in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

     a)   designed  such  disclosure  controls  and  procedures,  or caused such
          disclosure   controls  and   procedures  to  be  designed   under  our
          supervision,  to ensure  that  material  information  relating  to the
          registrant,  including its consolidated subsidiaries, is made known to
          us by others within those entities,  particularly during the period in
          which this report is being prepared;

     b)   evaluated the  effectiveness of the registrant's  disclosure  controls
          and procedures and presented in this report our conclusions  about the
          effectiveness of the disclosure controls and procedures, as of the end
          of the period covered by this report based on such evaluation; and

     c)   disclosed  in this  report  any  change in the  registrant's  internal
          control over financial reporting that occurred during the registrant's
          most recent fiscal quarter (the registrant's  fourth fiscal quarter in
          the case of an annual  report)  that has  materially  affected,  or is
          reasonably  likely to materially  affect,  the  registrant's  internal
          control over financial reporting; and

5.   The registrant's other certifying officer(s) and I have disclosed, based on
     our most recent evaluation of internal control over financial reporting, to
     the registrant's auditors and the audit committee of the registrant's board
     of directors (or persons performing the equivalent functions):

     a)   all significant  deficiencies and material weaknesses in the design or
          operation  of internal  control  over  financial  reporting  which are
          reasonably  likely to  adversely  affect the  registrant's  ability to
          record, process, summarize and report financial information; and

     b)   any fraud, whether or not material,  that involves management or other
          employees who have a  significant  role in the  registrant's  internal
          control over financial reporting.


Date     March 29, 2005
         -------------------

By       /s/  James R. Gelder
         -----------------------------------------------------------------
              James R. Gelder
              Director and Chairman, President and Chief Executive Officer
              (Duly Authorized Officer and Principal Executive Officer)


<PAGE>



                                                                    Exhibit 32.1


                                  CERTIFICATION


Pursuant to 18 U.S.C.  Section 1350, the  undersigned  officer of ReliaStar Life
Insurance  Company of New York (the  "Company")  hereby  certifies  that, to the
officer's knowledge, the Company's Annual Report on Form 10-K for the year ended
December 31, 2004 (the "Report") fully complies with the requirements of Section
13(a) or 15(d), as applicable,  of the Securities  Exchange Act of 1934 and that
the  information  contained  in the  Report  fairly  presents,  in all  material
respects, the financial condition and results of operations of the Company.


                                      By  /s/ David A. Wheat
March 29, 2005                           ---------------------------------------
--------------                                David A. Wheat
   Date                                       Director, Senior Vice President
                                                and Chief Financial Officer



<PAGE>


                                                                    Exhibit 32.2


                                  CERTIFICATION

Pursuant to 18 U.S.C.  Section 1350, the  undersigned  officer of ReliaStar Life
Insurance  Company of New York (the  "Company")  hereby  certifies  that, to the
officer's knowledge, the Company's Annual Report on Form 10-K for the year ended
December 31, 2004 (the "Report") fully complies with the requirements of Section
13(a) or 15(d), as applicable,  of the Securities  Exchange Act of 1934 and that
the  information  contained  in the  Report  fairly  presents,  in all  material
respects, the financial condition and results of operations of the Company.


                                         By /s/ James R. Gelder
March 29, 2005                              ------------------------------------
--------------                                  James R. Gelder
    Date                                        Director and Chairman, President
                                                  and Chief Executive Officer