----

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| For the quarterly period endedMarch 31, 2011 | Commission File Numbers: 2-99959, 33-29851, 33-31711, 33-41858, 33-43008, 33-58853, 333-11699, 333-77041, 333-62837, 333-45923, 333-88069, 333-39306, 333-46566, 333-82816, 333-82824, 333-111636, 333-130699, 333-130703, 333-130704, 333-133684, 333-133685, 333-133686, 333-39034, 333-144903-01, 333-144908-01, 333-144911-01, 333-144912-01, 333-155716, 333-333-155726, 333-155791, 333-155792, 333-155793, 333-155797, 333-156303, 333-156304, 333-156308, 333-160605, 333-160606, 333-160607, 333-169558-01, 333-169559-01, 333-169560-01, and 333-169561-01 |
|----------------------------------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Delaware                                                       | 04-2461439                        |
|----------------------------------------------------------------|-----------------------------------|
| (State or other jurisdiction of incorporation or organization) | (IRS Employer Identification No.) |

| One Sun Life Executive Park, Wellesley Hills, MA | 02481      |
|--------------------------------------------------|------------|
| (Address of principal executive offices)         | (Zip Code) |

| Large accelerated filer ¨          |                                          | Accelerated filer ¨         |
|-----------------------------------------|-----------------------------------------------|----------------------------------|
| Non-accelerated filer  þ | (Do not check if a smaller reporting company) | Smaller reporting company ¨ |

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Table of Contents

TABLE OF CONTENTS

|   | Page |
|--------|------|

|    | PART I - FINANCIAL INFORMATION                                                                                                                    |   |
|---------|---------------------------------------------------------------------------------------------------------------------------------------------------|--------|
|    |                                                                                                                                              |   |
| Item 1. | Financial Statements:                                                                                                                             |   |
|    |                                                                                                                                              |   |
|    | Condensed Consolidated Statements of Operations for the three-month periods endedMarch 31, 2011 and 2010 (Unaudited)                         | 3      |
|    |                                                                                                                                              |   |
|    | Condensed Consolidated Balance Sheets as of March 31, 2011 and December 31,   2010 (Unaudited)                                     | 4      |
|    |                                                                                                                                              |   |
|    | Condensed Consolidated Statements of Comprehensive Income for the three-   month periods ended March 31, 2011 and 2010 (Unaudited) | 5      |
|    |                                                                                                                                              |   |
|    | Condensed Consolidated Statements of Changes in Stockholder’s Equity for the three-month periods ended March 31, 2011 and 2010 (Unaudited)  | 6      |
|    |                                                                                                                                              |   |
|    | Condensed Consolidated Statements of Cash Flows for the three-month periods ended   March 31, 2011 and 2010 (Unaudited)            | 7      |
|    |                                                                                                                                              |   |
|    | Notes to the Unaudited Condensed Consolidated Financial Statements                                                                                | 9      |
|    |                                                                                                                                              |   |
| Item 2. | Management's Discussion and Analysis of Financial Position and Results of Operations                                                              | 62     |
|    |                                                                                                                                              |   |
| Item 3. | Quantitative and Qualitative Disclosures About Market Risk                                                                                        | 74     |
|    |                                                                                                                                              |   |
| Item 4. | Controls and Procedures                                                                                                                           | 74     |

|     | PART II -OTHER INFORMATION                                  |   |
|----------|-------------------------------------------------------------|--------|
|     |                                                        |   |
| Item 1.  | Legal Proceedings                                           | 74     |
|     |                                                        |   |
| Item 1A. | Risk Factors                                                | 74     |
|     |                                                        |   |
| Item 2.  | Unregistered Sales of Equity Securities and Use of Proceeds | 74     |
|     |                                                        |   |
| Item 3.  | Defaults Upon Senior Securities                             | 74     |
|     |                                                        |   |
| Item 4.  | (Removed and Reserved)                                      | 74     |
|     |                                                        |   |
| Item 5.  | Other Information                                           | 74     |
|     |                                                        |   |
| Item 6.  | Exhibits                                                    | 75     |

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Table of Contents

Item 1. Financial Statements.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

|                                                                                                           | Unaudited  |
|----------------------------------------------------------------------------------------------------------------|-----------------|
|                                                                                                           |  2011      |   |  2010 |
|                                                                                                           |            |   |   |   |   |
| Revenues                                                                                                       |            |   |   |   |   |
|                                                                                                           |            |   |   |   |   |
| Premiums and annuity considerations                                                                            | $               | 34,277  |   | $ | 35,064  |
| Net investment income (1)                                                                                      |            | 291,998  |   |   | 443,829  |
| Net derivative income (loss) (Note 5)                                                                          |            | 27,770  |   |   | (41,450) |
| Net realized investment gains, excluding impairment losses on  available-for-sale securities         |            | 4,083  |   |   | 5,165  |
| Other-than-temporary impairment losses (2)  (Note 5)                                                 |            | (71) |   |   | (885) |
| Fee and other income                                                                                           |            | 148,021  |   |   | 115,753  |
|                                                                                                           |            |   |   |   |   |
| Total revenues                                                                                                 |            | 506,078  |   |   | 557,476  |
|                                                                                                           |            |   |   |   |   |
| Benefits and Expenses                                                                                          |            |   |   |   |   |
|                                                                                                           |            |   |   |   |   |
| Interest credited                                                                                              |            | 87,876  |   |   | 89,383  |
| Interest expense                                                                                               |            | 11,092  |   |   | 17,097  |
| Policyowner benefits                                                                                           |            | 44,967  |   |   | 34,603  |
| Amortization of deferred policy acquisition costs, value of  business and customer renewals acquired |            | 248,114  |   |   | 171,709  |
| Other operating expenses                                                                                       |            | 89,485  |   |   | 80,910  |
|                                                                                                           |            |   |   |   |   |
| Total benefits and expenses                                                                                    |            | 481,534  |   |   | 393,702  |
|                                                                                                           |            |   |   |   |   |
| Income before income tax expense                                                                               |            | 24,544  |   |   | 163,774  |
|                                                                                                           |            |   |   |   |   |
| Income tax expense                                                                                             |            | 4,159  |   |   | 52,123  |
|                                                                                                           |            |   |   |   |   |
| Net income                                                                                                     | $               | 20,385  |   | $ | 111,651  |

| (1) | Net investment income includes an increase in market value of trading fixed maturity securities of $121.3 million and $270.4 million for the three-month periods ended March 31, 2011 and 2010, respectively. |
|-----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| (2) | The other-than-temporary impairment (“OTTI”) losses for the three-month periods ended March 31, 2011 and 2010 represent solely credit losses.  The Company incurred no non-credit OTTI losses during the three-month periods ended March 31, 2011 and 2010 as such, no non-credit OTTI losses were recognized in other comprehensive income for the periods. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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CONDENSED CONSOLIDATED BALANCE SHEETS

|                                                                                                                                                                     | Unaudited            |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------|----------------------|
| ASSETS                                                                                                                                                                   |  March 31, 2011 |   |  December 31, 2010 |
| Investments                                                                                                                                                              |                 |   |   |   |   |
| Available-for-sale fixed maturity securities at fair value (amortized cost of $1,519,833     and $1,422,951 in 2011 and 2010, respectively) (Note 5) |  $              | 1,579,255  |   |  $ | 1,495,923  |
| Trading fixed maturity securities at fair value (amortized cost of $11,531,390 and    $11,710,416 in 2011 and 2010, respectively) (Note 5)           |                 | 11,409,870  |   |   | 11,467,118  |
| Mortgage loans (Note 5)                                                                                                                                                  |                 | 1,685,060  |   |   | 1,737,528  |
| Derivative instruments – receivable (Note 5)                                                                                                                       |                 | 205,910  |   |   | 198,064  |
| Limited partnerships                                                                                                                                                     |                 | 39,000  |   |   | 41,622  |
| Real estate                                                                                                                                                              |                 | 216,449  |   |   | 214,665  |
| Policy loans                                                                                                                                                             |                 | 714,322  |   |   | 717,408  |
| Other invested assets                                                                                                                                                    |                 | 46,536  |   |   | 27,456  |
| Short-term investments                                                                                                                                                   |                 | 261,958  |   |   | 832,739  |
| Cash and cash equivalents                                                                                                                                                |                 | 1,054,028  |   |   | 736,323  |
| Total investments and cash                                                                                                                                               |                 | 17,212,388  |   |   | 17,468,846  |
|                                                                                                                                                                     |                 |   |   |   |   |
| Accrued investment income                                                                                                                                                |                 | 202,757  |   |   | 188,786  |
| Deferred policy acquisition costs and sales inducement asset                                                                                                             |                 | 1,506,460  |   |   | 1,682,559  |
| Value of business and customer renewals acquired                                                                                                                         |                 | 108,522  |   |   | 134,985  |
| Net deferred tax asset (Note 10)                                                                                                                                         |                 | 376,693  |   |   | 394,297  |
| Goodwill (Note 9)                                                                                                                                                        |                 | 7,299  |   |   | 7,299  |
| Receivable for investments sold                                                                                                                                          |                 | 34,431  |   |   | 5,328  |
| Reinsurance receivable                                                                                                                                                   |                 | 2,332,613  |   |   | 2,347,086  |
| Other assets                                                                                                                                                             |                 | 171,089  |   |   | 125,529  |
| Separate account assets                                                                                                                                                  |                 | 27,887,322  |   |   | 26,880,421  |
|                                                                                                                                                                     |                 |   |   |   |   |
| Total assets                                                                                                                                                             | $                    | 49,839,574  |   | $ | 49,235,136  |
|                                                                                                                                                                     |                 |   |   |   |   |
| LIABILITIES                                                                                                                                                              |                 |   |   |   |   |
|                                                                                                                                                                     |                 |   |   |   |   |
| Contractholder deposit funds and other policy liabilities                                                                                                                | $                    | 14,143,364  |   | $ | 14,593,228  |
| Future contract and policy benefits                                                                                                                                      |                 | 829,867  |   |   | 849,514  |
| Payable for investments purchased                                                                                                                                        |                 | 154,008  |   |   | 44,827  |
| Accrued expenses and taxes                                                                                                                                               |                 | 45,086  |   |   | 52,628  |
| Debt payable to affiliates                                                                                                                                               |                 | 783,000  |   |   | 783,000  |
| Reinsurance payable                                                                                                                                                      |                 | 2,216,725  |   |   | 2,231,835  |
| Derivative instruments – payable (Note 5)                                                                                                                          |                 | 311,765  |   |   | 362,023  |
| Other liabilities                                                                                                                                                        |                 | 303,304  |   |   | 285,056  |
| Separate account liabilities                                                                                                                                             |                 | 27,887,322  |   |   | 26,880,421  |
|                                                                                                                                                                     |                 |   |   |   |   |
| Total liabilities                                                                                                                                                        |                 | 46,674,441  |   |   | 46,082,532  |
|                                                                                                                                                                     |                 |   |   |   |   |
| Commitments and contingencies (Note 7)                                                                                                                                   |                 |   |   |   |   |
|                                                                                                                                                                     |                 |   |   |   |   |
| STOCKHOLDER’S EQUITY                                                                                                                                               |                 |   |   |   |   |
|                                                                                                                                                                     |                 |   |   |   |   |
| Common stock, $1,000 par value – 10,000 shares authorized; 6,437 shares     issued and outstanding in 2011 and 2010                  |  $              | 6,437  |   |  $ | 6,437  |
| Additional paid-in capital                                                                                                                                               |                 | 3,929,012  |   |   | 3,928,246  |
| Accumulated other comprehensive income                                                                                                                                   |                 | 37,931  |   |   | 46,553  |
| Accumulated deficit                                                                                                                                                      |                 | (808,247) |   |   | (828,632) |
|                                                                                                                                                                     |                 |   |   |   |   |
| Total stockholder’s equity                                                                                                                                         |                 | 3,165,133  |   |   | 3,152,604  |
|                                                                                                                                                                     |                 |   |   |   |   |
| Total liabilities and stockholder’s equity                                                                                                                         | $                    | 49,839,574  |   | $ | 49,235,136  |

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CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

|                                                                                                                                     | Unaudited |
|------------------------------------------------------------------------------------------------------------------------------------------|-----------|
|                                                                                                                                     |      |  2011 |   |   |  2010 |
|                                                                                                                                     |      |   |   |   |   |
| Net income                                                                                                                               | $         | 20,385  |   | $ | 111,651  |
|                                                                                                                                     |      |   |   |   |   |
| Other comprehensive (loss) income:                                                                                                       |      |   |   |   |   |
|                                                                                                                                     |      |   |   |   |   |
| Change in unrealized holding (losses) gains on available-for-sale     fixed maturity securities, net of tax (1) |      | (4,705) |   |   | 8,168  |
| Reclassification adjustment for OTTI losses, net of tax (2)                                                                              |      | -  |   |   | 104  |
| Reclassification adjustments of realized investment losses into net     income, net of tax (3)             |      | (3,917) |   |   | (2,383) |
|                                                                                                                                     |      |   |   |   |   |
| Other comprehensive (loss) income                                                                                                        |      | (8,622) |   |   | 5,889  |
|                                                                                                                                     |      |   |   |   |   |
| Comprehensive income                                                                                                                     | $         | 11,763  |   | $ | 117,540  |

|   | (1) | Net of tax benefit (expense) of $2.5 million and $(4.4) million for the three-month periods ended March 31, 2011 and 2010, respectively. |
|--------|-----|------------------------------------------------------------------------------------------------------------------------------------------|

|   | (2) | Represents an adjustment to OTTI losses due to the sale of other-than-temporarily impaired available-for-sale fixed maturity securities. |
|--------|-----|------------------------------------------------------------------------------------------------------------------------------------------|

|   | (3) | Net of tax benefit of $2.1 million and $1.3 million for the three-month periods ended March 31, 2011 and 2010, respectively. |
|--------|-----|------------------------------------------------------------------------------------------------------------------------------|

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CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDER’S EQUITY

|                             | CommonStock |        | AdditionalPaid-InCapital |   | AccumulatedOtherComprehensiveIncome (1) |   | AccumulatedDeficit |         | TotalStockholder’sEquity |
|----------------------------------|-------------|-------------|--------------------------|--------|-----------------------------------------|--------|--------------------|--------------|--------------------------------|
|                             |        |        |                     |   |                                    |   |               |         |                           |   |   |   |   |   |
| Balance at December 31, 2009     | $           | 6,437  |                     | $      | 3,527,677                          |   | $                  | 35,244  |                           | $ | (962,906) |   | $ | 2,606,452  |
|                             |        |        |                     |   |                                    |   |               |         |                           |   |   |   |   |   |
| Net income                       |        | -      |                     |   | -                                  |   |               | -       |                           |   | 111,651  |   |   | 111,651  |
| Tax benefit from stock options   |        | -      |                     |   | 168                                |   |               | -       |                           |   | -  |   |   | 168  |
| Capital contribution from Parent |        | -      |                     |   | 400,000                            |   |               | -       |                           |   | -  |   |   | 400,000  |
| Other comprehensive income       |        | -      |                     |   | -                                  |   |               | 5,889   |                           |   | -  |   |   | 5,889  |
|                             |        |        |                     |   |                                    |   |               |         |                           |   |   |   |   |   |
| Balance at March 31, 2010        | $           | 6,437  |                     | $      | 3,927,845                          |   | $                  | 41,133  |                           | $ | (851,255) |   | $ | 3,124,160  |
|                             |        |        |                     |   |                                    |   |               |         |                           |   |   |   |   |   |
|                             |        |        |                     |   |                                    |   |               |         |                           |   |   |   |   |   |
| Balance at December 31, 2010     | $           | 6,437  |                     | $      | 3,928,246                          |   | $                  | 46,553  |                           | $ | (828,632) |   | $ | 3,152,604  |
|                             |        |        |                     |   |                                    |   |               |         |                           |   |   |   |   |   |
| Net income                       |        | -      |                     |   | -                                  |   |               | -       |                           |   | 20,385  |   |   | 20,385  |
| Tax benefit from stock options   |        | -      |                     |   | 766                                |   |               | -       |                           |   | -  |   |   | 766  |
| Other comprehensive loss         |        | -      |                     |   | -                                  |   |               | (8,622)      |                           |   | -  |   |   | (8,622) |
|                             |        |        |                     |   |                                    |   |               |         |                           |   |   |   |   |   |
| Balance at March 31, 2011        | $           | 6,437  |                     | $      | 3,929,012                          |   | $                  | 37,931  |                           | $ | (808,247) |   | $ | 3,165,133  |
|                             |        |        |                     |   |                                    |   |               |         |                           |   |   |   |   |   |

|   | (1) As of March 31, 2011, the total amount of after tax non-credit OTTI losses recorded in the Company’s accumulated other comprehensive income was $8.0 million. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

|                                                                                                                                               | Unaudited |
|----------------------------------------------------------------------------------------------------------------------------------------------------|-----------|
|                                                                                                                                               | 2011      |   | 2010 |
|                                                                                                                                               |      |   |   |   |   |
| Cash Flows From Operating Activities:                                                                                                              |      |   |   |   |   |
| Net income                                                                                                                                         | $         | 20,385  |   | $ | 111,651  |
| Adjustments to reconcile net income to net cash provided by operating        activities:                   |      |   |   |   |   |
| Net amortization of premiums on investments                                                                                                        |      | 10,288  |   |   | 2,587  |
| Amortization of deferred policy acquisition costs and value of    business and customer renewals acquired                      |      | 248,114  |   |   | 171,709  |
| Depreciation and amortization                                                                                                                      |      | 4,916  |   |   | 1,214  |
| Net (gain) loss on derivatives                                                                                                                     |      | (40,770) |   |   | 6,121  |
| Net realized gains and OTTI credit losses on available-for-sale    investments                                                 |      | (4,012) |   |   | (4,280) |
| Net increase in fair value of trading investments                                                                                                  |      | (121,321) |   |   | (270,435) |
| Net realized (gains) losses on trading investments                                                                                                 |      | (2,221) |   |   | 33,927  |
| Undistributed loss on private equity limited partnerships                                                                                          |      | 694  |   |   | 1,631  |
| Interest credited to contractholder deposits                                                                                                       |      | 87,876  |   |   | 89,383  |
| Deferred federal income taxes                                                                                                                      |      | 22,247  |   |   | 54,531  |
| Changes in assets and liabilities:                                                                                                                 |      |   |   |   |   |
| Additions to deferred policy acquisition costs, sales inducement asset    and value of business and customer renewals acquired |      | (42,855) |   |   | (56,139) |
| Accrued investment income                                                                                                                          |      | (13,971) |   |   | 12,545  |
| Net change in reinsurance receivable/payable                                                                                                       |      | 32,349  |   |   | 28,868  |
| Future contract and policy benefits                                                                                                                |      | (19,647) |   |   | (20,539) |
| Other, net                                                                                                                                         |      | 48,210  |   |   | 81,228  |
|                                                                                                                                               |      |   |   |   |   |
| Net cash provided by operating activities                                                                                                          |      | 230,282  |   |   | 244,002  |
|                                                                                                                                               |      |   |   |   |   |
| Cash Flows From Investing Activities:                                                                                                              |      |   |   |   |   |
| Sales, maturities and repayments of:                                                                                                               |      |   |   |   |   |
| Available-for-sale fixed maturity securities                                                                                                       |      | 61,096  |   |   | 70,492  |
| Trading fixed maturity securities                                                                                                                  |      | 761,065  |   |   | 737,625  |
| Mortgage loans                                                                                                                                     |      | 50,056  |   |   | 25,096  |
| Other invested assets                                                                                                                              |      | (121,031) |   |   | (64,561) |
| Purchases of:                                                                                                                                      |      |   |   |   |   |
| Available-for-sale fixed maturity securities                                                                                                       |      | (151,392) |   |   | (46,399) |
| Trading fixed maturity securities                                                                                                                  |      | (595,288) |   |   | (1,332,465) |
| Mortgage loans                                                                                                                                     |      | (1,495) |   |   | (15,431) |
| Real estate                                                                                                                                        |      | (6,461) |   |   | (904) |
| Other invested assets                                                                                                                              |      | (32,224) |   |   | (16,616) |
| Net change in policy loans                                                                                                                         |      | 3,086  |   |   | 12,298  |
| Net change in short-term investments                                                                                                               |      | 570,781  |   |   | (784,436) |
|                                                                                                                                               |      |   |   |   |   |
| Net cash provided by (used in) investing activities                                                                                                | $         | 538,193  |   | $ | (1,415,301) |

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|                                                | Unaudited  |
|-----------------------------------------------------|------------|
|                                                |  2011 |   |  2010 |
|                                                |       |   |   |   |   |
| Cash Flows From Financing Activities:               |       |   |   |   |   |
| Additions to contractholder deposit funds           | $          | 251,867  |   | $ | 328,615  |
| Withdrawals from contractholder deposit funds       |       | (688,440) |   |   | (610,810) |
| Capital contribution from Parent                    |       | -  |   |   | 400,000  |
| Other, net                                          |       | (14,197) |   |   | (17,617) |
|                                                |       |   |   |   |   |
| Net cash (used in) provided by financing activities |       | (450,770) |   |   | 100,188  |
|                                                |       |   |   |   |   |
| Net change in cash and cash equivalents             |       | 317,705  |   |   | (1,071,111) |
|                                                |       |   |   |   |   |
| Cash and cash equivalents, beginning of period      |       | 736,323  |   |   | 1,804,208  |
|                                                |       |   |   |   |   |
|                                                |       |   |   |   |   |
| Cash and cash equivalents, end of period            | $          | 1,054,028  |   | $ | 733,097  |
|                                                |       |   |   |   |   |

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NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

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|   | 1. | The borrower is experiencing financial difficulties and |
|--------|----|---------------------------------------------------------|

|   | 2. | The lender has granted a concession to the borrower. |
|--------|----|------------------------------------------------------|

|   | · | A borrower’s inability to access funds at a market rate for a new loan with similar risk characteristics as the modified loan indicates that the modification was executed at a below-market rate and therefore may indicate that a concession was granted. |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | A temporary or permanent increase in the contractual interest rate as a result of restructuring does not preclude the restructuring from being considered a concession because the rate may still be below market. |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | · | A restructuring that results in an insignificant delay in contractual cash flow is not considered to be a concession. |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------|

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|                                                               | Three-month period ended March 31, 2011                 |   |                                                                                     |
|--------------------------------------------------------------------|---------------------------------------------------------|--------|------------------------------------------------------------------------------------------|
|                                                               |                                                    |   |                                                                                     |   |   |   |   |   |   |
|                                                               | Wealth                                                  |   | Individual                                                                               |   | Group |   |   |   |   |
|                                                               | Management                                              |   | Protection                                                                               |   | Protection |   | Corporate |   | Total |
| Total revenues                                                     | $     459,888             |   | $         19,506                       |   | $          31,307  |   | $      (4,623) |   | $     506,078  |
| Total benefits and expenses                                        | 424,528                                            |   | 21,893                                                                              |   | 30,418  |   | 4,695  |   | 481,534  |
| Income (loss) before income   tax expense (benefit) | 35,360                                             |   | (2,387)                                                                                  |   | 889  |   | (9,318) |   | 24,544  |
| Net income (loss)                                                  | $       27,963  |   |  $        (1,489)                           |   | $               583  |   | $     (6,672) |   | $       20,385  |
|                                                               |                                                    |   |                                                                                     |
|                                                               | Three-month period ended March 31, 2010                 |   |                                                                                     |
|                                                               |                                                    |   |                                                                                     |   |   |   |   |   |   |
|                                                               | Wealth                                                  |   | Individual                                                                               |   | Group |   |   |   |   |
|                                                               | Management                                              |   | Protection                                                                               |   | Protection |   | Corporate |   | Total |
| Total revenues                                                     | $      542,125       |   | $        15,226                             |   | $         32,261  |   | $     (32,136) |   | $      557,476  |
| Total benefits and expenses                                        | 337,465                                            |   | 14,215                                                                              |   | 31,148  |   | 10,874  |   | 393,702  |
| Income (loss) before income   tax expense (benefit) | 204,660                                            |   | 1,011                                                                               |   | 1,113  |   |  (43,010) |   | 163,774  |
| Net income (loss)                                                  | $      138,135       |   | $             711  |   | $              723  |   | $     (27,918) |   | $      111,651  |

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|   | · | Unadjusted quoted prices for identical assets or liabilities in an active market. |
|--------|--------|-----------------------------------------------------------------------------------|

|   | · | Quoted prices in markets that are not active or significant inputs that are observable either directly or indirectly. |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------|

|   | a) | Quoted prices for similar assets or liabilities in active markets, |
|--------|----|--------------------------------------------------------------------|

|   | b) | Quoted prices for identical or similar assets or liabilities in non-active markets, |
|--------|----|-------------------------------------------------------------------------------------|

|   | c) | Inputs other than quoted market prices that are observable, and |
|--------|----|-----------------------------------------------------------------|

|   | d) | Inputs that are derived principally from or corroborated by observable market data through correlation or other means. |
|--------|----|------------------------------------------------------------------------------------------------------------------------|

|   | · | Prices or valuation techniques that require inputs that are both unobservable and significant to the overall fair value measurement.  They reflect management's own assumptions about the assumptions a market participant would use in pricing the asset or liability. |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

Table of Contents

|                                                     |   | Level 1 |       | Level 2 |   | Level 3    |   | Total  |
|----------------------------------------------------------|--------|---------|------------|---------|--------|------------|--------|--------|
| Assets                                                   |   |    |       |    |   |       |   |   |   |   |   |   |
| Available-for-sale fixed maturity securities:            |   |    |       |    |   |       |   |   |   |   |   |   |
| Asset-backed securities                                  |   | $       | -          |    | $      | 207        |   | $      | 7 |   | $ | 214 |
| Residential mortgage-backed securities                   |   |    | -          |    |   | 31,966     |   |   | - |   |   | 31,966 |
| Commercial mortgage-backed securities                    |   |    | -          |    |   | 12,905     |   |   | 2,089 |   |   | 14,994 |
| Foreign government & agency securities               |   |    | -          |    |   | 559        |   |   | - |   |   | 559 |
| U.S. states and political subdivisions securities        |   |    | -          |    |   | 214        |   |   | - |   |   | 214 |
| U.S. treasury and agency securities                      |   |    | 481,313    |    |   | -          |   |   | - |   |   | 481,313 |
| Corporate securities                                     |   |    | -          |    |   | 1,042,609  |   |   | 7,386 |   |   | 1,049,995 |
| Total available-for-sale fixed maturity securities       |   |    | 481,313    |    |   | 1,088,460  |   |   | 9,482 |   |   | 1,579,255 |
|                                                     |   |    |       |    |   |       |   |   |   |   |   |   |
| Trading fixed maturity securities:                       |   |    |       |    |   |       |   |   |   |   |   |   |
| Asset-backed securities                                  |   |    | -          |    |   | 313,228    |   |   | 90,706 |   |   | 403,934 |
| Residential mortgage-backed securities                   |   |    | -          |    |   | 756,408    |   |   | 145,035 |   |   | 901,443 |
| Commercial mortgage-backed securities                    |   |    | -          |    |   | 777,162    |   |   | 81,994 |   |   | 859,156 |
| Foreign government & agency securities               |   |    | -          |    |   | 115,236    |   |   | 13,165 |   |   | 128,401 |
| U.S. states and political subdivisions securities        |   |    | -          |    |   | 609        |   |   | - |   |   | 609 |
| U.S. treasury and agency securities                      |   |    | 805,007    |    |   | 9,271      |   |   | 1,096 |   |   | 815,374 |
| Corporate securities                                     |   |    | -          |    |   | 8,194,416  |   |   | 106,537 |   |   | 8,300,953 |
| Total trading fixed maturity securities                  |   |    | 805,007    |    |   | 10,166,330 |   |   | 438,533 |   |   | 11,409,870 |
|                                                     |   |    |       |    |   |       |   |   |   |   |   |   |
| Derivative instruments - receivable:                     |   |    |       |    |   |       |   |   |   |   |   |   |
| Interest rate contracts                                  |   |    | -          |    |   | 65,086     |   |   | - |   |   | 65,086 |
| Foreign currency contracts                               |   |    | -          |    |   | 40,208     |   |   | - |   |   | 40,208 |
| Equity contracts                                         |   |    | 35,595     |    |   | 39,228     |   |   | 20,459 |   |   | 95,282 |
| Futures                                                  |   |    | 5,334      |    |   | -          |   |   | - |   |   | 5,334 |
| Total derivative instruments - receivable                |   |    | 40,929     |    |   | 144,522    |   |   | 20,459 |   |   | 205,910 |
|                                                     |   |    |       |    |   |       |   |   |   |   |   |   |
| Other invested assets                                    |   |    | 3,810      |    |   | 27,555     |   |   | 10,156 |   |   | 41,521 |
| Short-term investments                                   |   |    | 261,958    |    |   | -          |   |   | - |   |   | 261,958 |
| Cash and cash equivalents                                |   |    | 1,054,028  |    |   | -          |   |   | - |   |   | 1,054,028 |
| Total investments and cash                               |   |    | 2,647,045  |    |   | 11,426,867 |   |   | 478,630 |   |   | 14,552,542 |
|                                                     |   |    |       |    |   |       |   |   |   |   |   |   |
| Separate account assets:                                 |   |    |       |    |   |       |   |   |   |   |   |   |
| Mutual fund investments                                  |   |    | 23,265,062 |    |   | 26,851     |   |   | - |   |   | 23,291,913 |
| Equity investments                                       |   |    | 190,475    |    |   | 134        |   |   | 64 |   |   | 190,673 |
| Fixed income investments                                 |   |    | 368,800    |    |   | 5,759,915  |   |   | 66,935 |   |   | 6,195,650 |
| Alternative investments                                  |   |    | 9,665      |    |   | 74,646     |   |   | 348,076 |   |   | 432,387 |
| Other investments                                        |   |    | 3,300      |    |   | -          |   |   | - |   |   | 3,300 |
| Total separate account assets (1) (2)                    |   |    | 23,837,302 |    |   | 5,861,546  |   |   | 415,075 |   |   | 30,113,923 |
|                                                     |   |    |       |    |   |       |   |   |   |   |   |   |
| Total assets measured at fair value on a recurring basis |   | $       | 26,484,347 |    | $      | 17,288,413 |   | $      | 893,705 |   | $ | 44,666,465 |

|   | (1) Pursuant to the conditions set forth in FASB ASC Topic 944, “Financial Services–Insurance,” the value of separate account liabilities is set to equal the fair value of the separate account assets. |
|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (2)  Excludes $2,226.6 million, primarily related to investment purchases payable, net of investment sales receivable, that are not subject to FASB ASC Topic 820, “Fair Value Measurement.” |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

Table of Contents

|   | SUN LIFE ASSURANCE COMPANY OF CANADA (U.S.) |
|--------|---------------------------------------------|

|                                                          |   | Level 1 |   | Level 2 |   | Level 3 |   | Total  |
|---------------------------------------------------------------|--------|---------|--------|---------|--------|---------|--------|--------|
| Liabilities                                                   |   |    |   |    |   |    |   |   |   |   |   |   |
| Other policy liabilities:                                     |   |    |   |    |   |    |   |   |   |   |   |   |
| Guaranteed minimum withdrawal benefit liability (1)           |   | $       | -      |    | $      | -       |   | $      | (122,682) |   | $ | (122,682) |
| Guaranteed minimum accumulation benefit liability (1)         |   |    | -      |    |   | -       |   |   | (34,560) |   |   | (34,560) |
| Derivatives embedded in reinsurance contracts(1)              |   |    | -      |    |   | 62,712  |   |   | 20,459  |   |   | 83,171  |
| Fixed index annuities(1)                                      |   |    | -      |    |   | -       |   |   | 139,577  |   |   | 139,577  |
| Total other policy liabilities                                |   |    | -      |    |   | 62,712  |   |   | 2,794 |   |   | 65,506  |
|                                                          |   |    |   |    |   |    |   |   |   |   |   |   |
| Derivative instruments – payable:                       |   |    |   |    |   |    |   |   |   |   |   |   |
| Interest rate contracts                                       |   |    | -      |    |   | 281,475 |   |   | -  |   |   | 281,475  |
| Foreign currency contracts                                    |   |    | -      |    |   | 3,990   |   |   | -  |   |   | 3,990  |
| Credit contracts                                              |   |    | -      |    |   | -       |   |   | 23,846  |   |   | 23,846  |
| Futures contracts                                             |   |    | 2,454  |    |   | -       |   |   | -  |   |   | 2,454  |
| Total derivative instruments – payable                  |   |    | 2,454  |    |   | 285,465 |   |   | 23,846  |   |   | 311,765  |
|                                                          |   |    |   |    |   |    |   |   |   |   |   |   |
| Other liabilities:                                            |   |    |   |    |   |    |   |   |   |   |   |   |
| Bank overdrafts                                               |   |    | 46,265 |    |   | -       |   |   | -  |   |   | 46,265  |
|                                                          |   |    |   |    |   |    |   |   |   |   |   |   |
| Total liabilities measured at fair value on a recurring basis |   | $       | 48,719 |    | $      | 348,177 |   | $      | 26,640  |   | $ | 423,536  |

|   | (1) The balances are included within the contractholder deposits funds and other policy liabilities in the Company’s condensed consolidated balance sheets.  At March 31, 2011, the net balances of guaranteed minimum withdrawal and accumulation benefits were in an asset position. |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

Table of Contents

|                                                     |   | Level 1 |       | Level 2 |   | Level 3    |   | Total  |
|----------------------------------------------------------|--------|---------|------------|---------|--------|------------|--------|--------|
| Assets                                                   |   |    |       |    |   |       |   |   |   |   |   |   |
| Available-for-sale fixed maturity securities:            |   |    |       |    |   |       |   |   |   |   |   |   |
| Asset-backed securities                                  |   | $       | -          |    | $      | 704        |   | $      | 11 |   | $ | 715 |
| Residential mortgage-backed securities                   |   |    | -          |    |   | 34,614     |   |   | - |   |   | 34,614 |
| Commercial mortgage-backed securities                    |   |    | -          |    |   | 13,003     |   |   | 2,047 |   |   | 15,050 |
| Foreign government & agency securities               |   |    | -          |    |   | 563        |   |   | - |   |   | 563 |
| U.S. states and political subdivisions securities        |   |    | -          |    |   | 214        |   |   | - |   |   | 214 |
| U.S. treasury and agency securities                      |   |    | 375,233    |    |   | -          |   |   | - |   |   | 375,233 |
| Corporate securities                                     |   |    | -          |    |   | 1,068,399  |   |   | 1,135 |   |   | 1,069,534 |
| Total available-for-sale fixed maturity securities       |   |    | 375,233    |    |   | 1,117,497  |   |   | 3,193 |   |   | 1,495,923 |
|                                                     |   |    |       |    |   |       |   |   |   |   |   |   |
| Trading fixed maturity securities:                       |   |    |       |    |   |       |   |   |   |   |   |   |
| Asset-backed securities                                  |   |    | -          |    |   | 321,129    |   |   | 90,851 |   |   | 411,980 |
| Residential mortgage-backed securities                   |   |    | -          |    |   | 834,074    |   |   | 88,719 |   |   | 922,793 |
| Commercial mortgage-backed securities                    |   |    | -          |    |   | 737,024    |   |   | 82,171 |   |   | 819,195 |
| Foreign government & agency securities               |   |    | -          |    |   | 116,986    |   |   | 13,790 |   |   | 130,776 |
| U.S. states and political subdivisions securities        |   |    | -          |    |   | 613        |   |   | - |   |   | 613 |
| U.S. treasury and agency securities                      |   |    | 737,936    |    |   | 8,582      |   |   | 1,101 |   |   | 747,619 |
| Corporate securities                                     |   |    | -          |    |   | 8,301,586  |   |   | 132,556 |   |   | 8,434,142 |
| Total trading fixed maturity securities                  |   |    | 737,936    |    |   | 10,319,994 |   |   | 409,188 |   |   | 11,467,118 |
|                                                     |   |    |       |    |   |       |   |   |   |   |   |   |
| Derivative instruments - receivable:                     |   |    |       |    |   |       |   |   |   |   |   |   |
| Interest rate contracts                                  |   |    | -          |    |   | 97,060     |   |   | - |   |   | 97,060 |
| Foreign currency contracts                               |   |    | -          |    |   | 32,504     |   |   | - |   |   | 32,504 |
| Equity contracts                                         |   |    | 14,873     |    |   | 30,739     |   |   | 13,785 |   |   | 59,397 |
| Futures contracts                                        |   |    | 9,103      |    |   | -          |   |   | - |   |   | 9,103 |
| Total derivative instruments - receivable                |   |    | 23,976     |    |   | 160,303    |   |   | 13,785 |   |   | 198,064 |
|                                                     |   |    |       |    |   |       |   |   |   |   |   |   |
| Other invested assets                                    |   |    | 2,890      |    |   | 11,120     |   |   | 8,343 |   |   | 22,353 |
| Short-term investments                                   |   |    | 832,739    |    |   | -          |   |   | - |   |   | 832,739 |
| Cash and cash equivalents                                |   |    | 736,323    |    |   | -          |   |   | - |   |   | 736,323 |
| Total investments and cash                               |   |    | 2,709,097  |    |   | 11,608,914 |   |   | 434,509 |   |   | 14,752,520 |
|                                                     |   |    |       |    |   |       |   |   |   |   |   |   |
| Separate account assets:                                 |   |    |       |    |   |       |   |   |   |   |   |   |
| Mutual fund investments                                  |   |    | 21,892,209 |    |   | 30,517     |   |   | - |   |   | 21,922,726 |
| Equity investments                                       |   |    | 188,216    |    |   | 277        |   |   | - |   |   | 188,493 |
| Fixed income investments                                 |   |    | 317,713    |    |   | 5,812,900  |   |   | 56,323 |   |   | 6,186,936 |
| Alternative investments                                  |   |    | 24,094     |    |   | 78,164     |   |   | 293,254 |   |   | 395,512 |
| Other investments                                        |   |    | 900        |    |   | -          |   |   | - |   |   | 900 |
| Total separate account assets (1) (2)                    |   |    | 22,423,132 |    |   | 5,921,858  |   |   | 349,577 |   |   | 28,694,567 |
|                                                     |   |    |       |    |   |       |   |   |   |   |   |   |
| Total assets measured at fair value on a recurring basis |   | $       | 25,132,229 |    | $      | 17,530,772 |   | $      | 784,086 |   | $ | 43,447,087 |

|   |  (1) Pursuant to the conditions set forth in FASB ASC Topic 944, the value of separate account liabilities is set to equal the fair value of the separate account assets. |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (2) Excludes $1,814.1 million, primarily related to investment purchases payable, net of investment sales receivable, that are not subject to FASB ASC Topic 820. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

Table of Contents

|                                                          |   | Level 1 |   | Level 2 |   | Level 3 |   | Total  |
|---------------------------------------------------------------|--------|---------|--------|---------|--------|---------|--------|--------|
| Liabilities                                                   |   |    |   |    |   |    |   |   |   |   |   |   |
| Other policy liabilities:                                     |   |    |   |    |   |    |   |   |   |   |   |   |
| Guaranteed minimum withdrawal benefit liability               |   | $       | -      |    | $      | -       |   | $      | 2,245 |   | $ | 2,245 |
| Guaranteed minimum accumulation benefit liability             |   |    | -      |    |   | -       |   |   | 49 |   |   | 49 |
| Derivatives embedded in reinsurance contracts                 |   |    | -      |    |   | 41,272  |   |   | - |   |   | 41,272 |
| Fixed index annuities                                         |   |    | -      |    |   | -       |   |   | 131,608 |   |   | 131,608 |
| Total other policy liabilities                                |   |    | -      |    |   | 41,272  |   |   | 133,902 |   |   | 175,174 |
|                                                          |   |    |   |    |   |    |   |   |   |   |   |   |
| Derivative instruments – payable:                       |   |    |   |    |   |    |   |   |   |   |   |   |
| Interest rate contracts                                       |   |    | -      |    |   | 329,214 |   |   | - |   |   | 329,214 |
| Foreign currency contracts                                    |   |    | -      |    |   | 3,878   |   |   | - |   |   | 3,878 |
| Credit contracts                                              |   |    | -      |    |   | -       |   |   | 27,341 |   |   | 27,341 |
| Futures contracts                                             |   |    | 1,590  |    |   | -       |   |   | - |   |   | 1,590 |
| Total derivative instruments – payable                  |   |    | 1,590  |    |   | 333,092 |   |   | 27,341 |   |   | 362,023 |
|                                                          |   |    |   |    |   |    |   |   |   |   |   |   |
| Other liabilities:                                            |   |    |   |    |   |    |   |   |   |   |   |   |
| Bank overdrafts                                               |   |    | 61,227 |    |   | -       |   |   | - |   |   | 61,227 |
|                                                          |   |    |   |    |   |    |   |   |   |   |   |   |
| Total liabilities measured at fair value on a recurring basis |   | $       | 62,817 |    | $      | 374,364 |   | $      | 161,243 |   | $ | 598,424 |

----

Table of Contents

----

Table of Contents

----

Table of Contents

| Assets                                                                       | Beginningbalance                                    | Total realized andunrealized gains(losses)                       | Purchases                                                      | Sales                                        | Issuances                                                            | Settlements                                        | Transfersintolevel 3                                                 | Transfersout of level3                                         |  Endingbalance                                                              | Change in totalgains (losses)included inearningsrelating toinstrumentsstill held at thereporting date |
|------------------------------------------------------------------------------|-----------------------------------------------------|------------------------------------------------------------------|----------------------------------------------------------------|----------------------------------------------|----------------------------------------------------------------------|----------------------------------------------------|----------------------------------------------------------------------|----------------------------------------------------------------|----------------------------------------------------------------------------------|-------------------------------------------------------------------------------------------------------|
| Includedinearnings                                                           | Includedin OCI                                      |
| Available-for-sale fixed maturity securities:                                |                                                |                                                             |                                                           |                                         |                                                                 |                                               |                                                                 |                                                           |                                                                             |                                                                                                  |   |
|       Asset-backed                                  | $        11 | $          (7) | $          3 | $       - | $           - | $     -                   | $           - | $          - | $             - | $          7                                        | $                  -  |
|       Residential mortgage-backed                   |  -                                             | -                                                           | -                                                              | -                                            |  -                                                              | -                                                  | -                                                                    | -                                                              |  -                                                                          | -                                                                                                     | -  |
| Commercial mortgage-backed                                                   |  2,047                                         |  (133)                                                      | 175                                                            |  -                                      |  -                                                              |  -                                            |  -                                                              |  -                                                        |  -                                                                          | 2,089                                                                                                 | -  |
| Foreign government & agency                                              | -                                                   |  -                                                     | -                                                              |  -                                      |  -                                                              |  -                                            |  -                                                              |  -                                                        |  -                                                                          | -                                                                                                     | -  |
| U.S. states & political subdivisions                                     | -                                                   |  -                                                     | -                                                              |  -                                      |  -                                                              |  -                                            |  -                                                              |  -                                                        |  -                                                                          | -                                                                                                     | -  |
| U.S. treasury and agency                                                     | -                                                   |  -                                                     | -                                                              |  -                                      |  -                                                              |  -                                            |  -                                                              |  -                                                        |  -                                                                          | -                                                                                                     | -  |
| Corporate                                                                    |  1,135                                         |  5                                                     | 178                                                            |  6,102                                  |  -                                                              |  -                                            |  (34)                                                           |  -                                                        |  -                                                                          | 7,386                                                                                                 | -  |
| Total available-for-sale fixed    maturity securities    |  3,193                                         | (135)                                                            |  356                                                      | 6,102                                        |  -                                                              |  -                                            | (34)                                                                 |  -                                                        |  -                                                                          |  9,482                                                                                           | -  |
|                                                                         |                                                |                                                             |                                                           |                                         |                                                                 |                                               |                                                                 |                                                           |                                                                             |                                                                                                  |   |
| Trading fixed maturity securities:                                           |                                                |                                                             |                                                           |                                         |                                                                 |                                               |                                                                 |                                                           |                                                                             |                                                                                                  |   |
| Asset-backed                                                                 |  90,851                                        | 9,233                                                       | -                                                              |  -                                      |  -                                                              |  -                                            | (2,069)                                                              | 10,033                                                         | (17,342)                                                                         | 90,706                                                                                                | 8,980  |
| Residential mortgage-backed                                                  | 88,719                                              | 9,405                                                       |  -                                                        |  -                                      |  -                                                              |  -                                            | (6,696)                                                              | 87,338                                                         | (33,731)                                                                         | 145,035                                                                                               | 11,690  |
| Commercial mortgage-backed                                                   | 82,171                                              | 758                                                         |  -                                                        |  -                                      |  -                                                              |  -                                            |  (935)                                                          |  -                                                        |  -                                                                          | 81,994                                                                                                | 1,151  |
| Foreign government & agency                                              | 13,790                                              | (625)                                                            |  -                                                        |  -                                      |  -                                                              |  -                                            |  -                                                              |  -                                                        |  -                                                                          | 13,165                                                                                                | (212) |
| U.S. states & political subdivisions                                     |  -                                             |  -                                                     |  -                                                        |  -                                      |  -                                                              |  -                                            |  -                                                              |  -                                                        |  -                                                                          | -                                                                                                     |  -  |
| U.S. treasury and agency                                                     | 1,101                                               | (5)                                                              |  -                                                        |  -                                      |  -                                                              |  -                                            |  -                                                              |  -                                                        |  -                                                                          | 1,096                                                                                                 | 3  |
| Corporate                                                                    | 132,556                                             | 6,999                                                       |  -                                                        |  6,932                                  | (3,404)                                                              |  -                                            | (4,127)                                                              | 3,202                                                          | (35,621)                                                                         | 106,537                                                                                               | 6,431  |
| Total trading fixed maturity    securities               | 409,188                                             | 25,765                                                      |  -                                                        | 6,932                                        | (3,404)                                                              |  -                                            | (13,827)                                                             | 100,573                                                        | (86,694)                                                                         | 438,533                                                                                               | 28,043  |
|                                                                         |                                                |                                                             |                                                           |                                         |                                                                 |                                               |                                                                 |                                                           |                                                                             |                                                                                                  |   |
| Derivative instruments – receivable:                                   |                                                |                                                             |                                                           |                                         |                                                                 |                                               |                                                                 |                                                           |                                                                             |                                                                                                  |   |
| Interest rate contracts                                                      | -                                                   |  -                                                          | -                                                              |  -                                      |  -                                                              |  -                                            |  -                                                              |  -                                                        |  -                                                                          | -                                                                                                     |  -  |
| Foreign currency contracts                                                   | -                                                   |  -                                                          | -                                                              |  -                                      |  -                                                              |  -                                            |  -                                                              |  -                                                        |  -                                                                          | -                                                                                                     |  -  |
| Equity contracts                                                             |  13,785                                        | 6,204                                                            | -                                                              |  1,496                                  |  -                                                              |  -                                            | (1,026)                                                              |  -                                                        |  -                                                                          | 20,459                                                                                                | 6,204  |
| Futures Contracts                                                            | -                                                   |  -                                                          | -                                                              |  -                                      |  -                                                              |  -                                            |  -                                                              |  -                                                        |  -                                                                          | -                                                                                                     |  -  |
| Total derivative instruments –     receivable |  13,785                                        | 6,204                                                            | -                                                              | 1,496                                        |  -                                                              |  -                                            | (1,026)                                                              |  -                                                        |  -                                                                          | 20,459                                                                                                | 6,204  |
|                                                                         |                                                |                                                             |                                                           |                                         |                                                                 |                                               |                                                                 |                                                           |                                                                             |                                                                                                  |   |
| Other invested assets                                                        |  8,343                                         | 633                                                              |  180                                                      | 1,000                                        |  -                                                              |  -                                            |  -                                                              |  -                                                        |  -                                                                          | 10,156                                                                                                | 633  |
| Short-term investments                                                       | -                                                   |  -                                                          | -                                                              |  -                                      |  -                                                              |  -                                            |  -                                                              |  -                                                        |  -                                                                          | -                                                                                                     |  -  |
| Cash and cash equivalents                                                    | -                                                   |  -                                                          | -                                                              |  -                                      |  -                                                              |  -                                            |  -                                                              |  -                                                        |  -                                                                          | -                                                                                                     |  -  |
| Total investments and cash                                                   | 434,509                                             | 32,467                                                           |  536                                                      | 15,530                                       | (3,404)                                                              |  -                                            | (14,887)                                                             | 100,573                                                        | (86,694)                                                                         | 478,630                                                                                               | 34,880  |
|                                                                         |                                                |                                                             |                                                           |                                         |                                                                 |                                               |                                                                 |                                                           |                                                                             |                                                                                                  |   |
| Separate account assets:                                                     |                                                |                                                             |                                                           |                                         |                                                                 |                                               |                                                                 |                                                           |                                                                             |                                                                                                  |   |
| Mutual fund investments                                                      | -                                                   |  -                                                          | -                                                              |  -                                      |  -                                                              |  -                                            |  -                                                              |  -                                                        |  -                                                                          | -                                                                                                     |  -  |
| Equity investments                                                           | -                                                   |  -                                                          | -                                                              |  -                                      |  -                                                              |  -                                            |  -                                                              |  64                                                       |  -                                                                          |  64                                                                                              |  -  |
| Fixed income investments                                                     |  56,323                                        |  27                                                         | -                                                              |  69,387                                 | (67,214)                                                             |  -                                            | (6,856)                                                              | 32,401                                                         | (17,133)                                                                         | 66,935                                                                                                | (265) |
| Alternative investments                                                      | 293,254                                             | 13,676                                                           | -                                                              |  59,978                                 | (19,556)                                                             |  -                                            | (2,476)                                                              | 3,200                                                          |  -                                                                          | 348,076                                                                                               | 13,014  |
| Other investments                                                            | -                                                   |  -                                                          | -                                                              |  -                                      |  -                                                              |  -                                            |  -                                                              |  -                                                        |  -                                                                          | -                                                                                                     |  -  |
| Total separate account assets (1)                                            | 349,577                                             | 13,703                                                           | -                                                              |  129,365                                | (86,770)                                                             |  -                                            | (9,332)                                                              | 35,665                                                         | (17,133)                                                                         | 415,075                                                                                               | 12,749  |
|                                                                         |                                                |                                                             |                                                           |                                         |                                                                 |                                               |                                                                 |                                                           |                                                                             |                                                                                                  |   |
| Total assets measured at fair value on a recurring basis                | $784,086                                            | $   46,170                                        | $      536                       | $144,895                                     | $(90,174)                                                            | $       -  | $ (24,219)                                                           | $136,238                                                       | $(103,827)                                                                       | $893,705                                                                                              | $          47,629  |

|   | (1)The realized/unrealized gains (losses) included in net income for separate account assets are offset by an equal amount for separate account liabilities which results in a net zero impact on net income for the Company. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

Table of Contents

| Liabilities                                                             | Beginningbalance         | Total realized and unrealized(gains) losses | Purchases                                                                                    | Sales                                                                | Issuances                                    | Settlements         | Transfersintolevel 3                                                 | Transfersout oflevel 3                                   | Endingbalance                                                  | Change in total(gains) lossesincluded inearningsrelating toinstrumentsstill held at thereporting date |
|-------------------------------------------------------------------------|--------------------------|---------------------------------------------|----------------------------------------------------------------------------------------------|----------------------------------------------------------------------|----------------------------------------------|---------------------|----------------------------------------------------------------------|----------------------------------------------------------|----------------------------------------------------------------|-------------------------------------------------------------------------------------------------------|
| Includedinearnings                                                      | Included inOCI           |
|                                                                    |                     |                                        |                                                                                         |                                                                 |                                         |                |                                                                 |                                                     |                                                           |                                                                                                  |   |
| Other policy liabilities:                                               |                     |                                        |                                                                                         |                                                                 |                                         |                |                                                                 |                                                     |                                                           |                                                                                                  |   |
| Guaranteed minimum withdrawal   benefit liability (1)    | $   2,245 | $ (175,977)                                 | $               - | $           - | $      -       | $  51,050 | $           - | $         - | $          - | $ (122,682)                                                                                           | $       (177,433) |   |
| Guaranteed minimum accumulation    benefit liability (1) |  49                 | (40,508)                                    | -                                                                                            |  -                                                              |  -                                      |  5,899         |  -                                                              |  -                                                  |  -                                                        | (34,560)                                                                                              | (40,903) |   |
| Derivatives embedded in   reinsurance contracts(1)       | -                        |  -                                     | -                                                                                            | -                                                                    |  -                                      | 20,459              |  -                                                              |  -                                                  |  -                                                        | 20,459                                                                                                |  -  |   |
|       Fixed index annuities(1)            | 131,608                  | 5,524                                       | -                                                                                            |  -                                                              |  -                                      |  2,445         |  -                                                              |  -                                                  |  -                                                        | 139,577                                                                                               | 15,834  |   |
| Total other policy liabilities                                          | 133,902                  | (210,961)                                   | -                                                                                            |  -                                                              |  -                                      | 79,853              |  -                                                              |  -                                                  |  -                                                        | 2,794                                                                                                 | (202,502) |   |
|                                                                    |                     |                                        |                                                                                         |                                                                 |                                         |                |                                                                 |                                                     |                                                           |                                                                                                  |   |   |
| Derivative instruments – payable:                                 |                     |                                        |                                                                                         |                                                                 |                                         |                |                                                                 |                                                     |                                                           |                                                                                                  |   |   |
| Interest rate contracts                                                 | -                        |  -                                     | -                                                                                            |  -                                                              |  -                                      |  -             |  -                                                              |  -                                                  |  -                                                        | -                                                                                                     |  -  |   |
| Foreign currency contracts                                              | -                        |  -                                     | -                                                                                            |  -                                                              |  -                                      |  -             |  -                                                              |  -                                                  |  -                                                        | -                                                                                                     |  -  |
| Credit contracts                                                        |  27,341             | (3,495)                                     | -                                                                                            |  -                                                              |  -                                      |  -             |  -                                                              |  -                                                  |  -                                                        | 23,846                                                                                                | (3,495) |
| Futures Contracts                                                       | -                        |  -                                     | -                                                                                            |  -                                                              |  -                                      |  -             |  -                                                              |  -                                                  |  -                                                        | -                                                                                                     |  -  |
| Total derivative instruments – payable                       |  27,341             | (3,495)                                     | -                                                                                            |  -                                                              |  -                                      |  -             |  -                                                              |  -                                                  |  -                                                        | 23,846                                                                                                | (3,495) |
|                                                                    |                     |                                        |                                                                                         |                                                                 |                                         |                |                                                                 |                                                     |                                                           |                                                                                                  |   |
|                                                                    |                     |                                        |                                                                                         |                                                                 |                                         |                |                                                                 |                                                     |                                                           |                                                                                                  |   |
| Other liabilities:                                                      |                     |                                        |                                                                                         |                                                                 |                                         |                |                                                                 |                                                     |                                                           |                                                                                                  |   |
| Bank overdrafts                                                         | -                        |  -                                     | -                                                                                            |  -                                                              |  -                                      |  -             |  -                                                              |  -                                                  |  -                                                        | -                                                                                                     |  -  |
| Total liabilities measured at fair value on a recurring basis           | $161,24                  | $ (214,456)                                 | $               - | $           - | $       - | $  79,853 | $         -             | $         - | $          - | $     26,640                                                                 | $       (205,997) |

| (1) | The balances are included within the contractholder deposits funds and other policy liabilities in the Company’s condensed consolidated balance sheets.  At March 31, 2011, the net balances of guaranteed minimum withdrawal and accumulation benefits were in an asset position. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                                                                                                       |   | Total gains (losses)included inearnings |   | Change in unrealizedgains (losses) related toassets and liabilitiesstill held  at thereporting date |
|----------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------------------|--------|---------------------------------------------------------------------------------------------------------------|
| Net investment income                                                                                                      | $      | 26,398                             | $      | 28,676                                                                                                   |
| Net derivative income                                                                                                      |   | 220,660                            |   | 212,201                                                                                                  |
| Net realized investment losses, excluding impairment      losses on available-for-sale securities |   | (135)                                   |   | -                                                                                                        |
| Net gains                                                                                                                  | $      | 246,923                            | $      | 240,877                                                                                                  |

----

Table of Contents

| Assets                                                                                     | Beginning balance                                                           | Total realized and unrealized gains (losses) | Purchases, issuances, and settlements (net)                                                                          | Transfers in and/or (out) of level 3                                                                                                                     | Ending balance                                                                                                                   | Change in unrealized gains (losses) included in earnings relating to instruments still held at the reporting date |
|--------------------------------------------------------------------------------------------|-----------------------------------------------------------------------------|----------------------------------------------|----------------------------------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------------------------------------|-------------------------------------------------------------------------------------------------------------------|
| Included in earnings                                                                       | Included inothercomprehensive income                                        |
|                                                                                       |                                                                        |                                         |                                                                                                                 |                                                                                                                                                     |                                                                                                                             |                                                                                                              |   |
| Available-for-sale fixed maturity securities:                                              |                                                                        |                                         |                                                                                                                 |                                                                                                                                                     |                                                                                                                             |                                                                                                              |   |
| Asset-backed securities                                                                    | $       37      | $     (12)          | $                  4  | $                        -  | $                    -  | $               29                | $                      -  |   |
| Residential mortgage-backed securities                                                     | -                                                       | -                                       | -                                                                                                               | -                                                                                                                                                   | -                                                                                                                           | -                                                                                                            | -  |   |
| Commercial mortgage-backed   securities                                     | 1,930                                                   | (243)                                        | (552)                                                                                                                | -                                                                                                                                                   | -                                                                                                                           | 1,135                                                                                                        | -  |   |
| Foreign government & agency    securities                               | -                                                                      | -                                       | -                                                                                                               | -                                                                                                                                                   | -                                                                                                                           | -                                                                                                            | -  |   |
| U.S. states and political subdivisions    securities                        | -                                                                      | -                                       | -                                                                                                               | -                                                                                                                                                   | -                                                                                                                           | -                                                                                                            | -  |   |
| U.S. treasury and agency securities                                                        | -                                                                      | -                                       | -                                                                                                               | -                                                                                                                                                   | -                                                                                                                           | -                                                                                                            | -  |   |
| Corporate securities                                                                       | 7,936                                                   | (5)                                          | (4)                                                                                                                  |  196                                                                                                                                           | (7,184)                                                                                                                          | 939                                                                                                          | -  |   |
| Total available-for-sale fixed maturity     securities                 | 9,903                                                   | (260)                                        | (552)                                                                                                                | 196                                                                                                                                                 | (7,184)                                                                                                                          | 2,103                                                                                                        | -  |   |
|                                                                                       |                                                                        |                                         |                                                                                                                 |                                                                                                                                                     |                                                                                                                             |                                                                                                              |   |
| Trading fixed maturity securities:                                                         |                                                                        |                                         |                                                                                                                 |                                                                                                                                                     |                                                                                                                             |                                                                                                              |   |
| Asset-backed securities                                                                    | 111,650                                                 | (8,909)                                      | -                                                                                                               | (15,660)                                                                                                                                                 | (38,157)                                                                                                                         | 48,924                                                                                                       | 8,858  |
| Residential mortgage-backed securities                                                     | 154,551                                                 | (242)                                        | -                                                                                                               | (3,226)                                                                                                                                                  |  (45,529)                                                                                                                   | 105,554                                                                                                      | 2,279  |
| Commercial mortgage-backed   securities                                     | 14,084                                             | (496)                                        | -                                                                                                               | -                                                                                                                                                   |  (696)                                                                                                                      | 12,892                                                                                                       |  (769) |
| Foreign government & agency   securities                                | 15,323                                                  | (230)                                        | -                                                                                                               | -                                                                                                                                                   | -                                                                                                                           | 15,093                                                                                                       | 161  |
| U.S. states and political subdivisions   securities                         | -                                                                      | -                                       | -                                                                                                               | -                                                                                                                                                   | -                                                                                                                           | -                                                                                                            | -  |
| U.S. treasury and agency securities                                                        | -                                                                      | -                                       | -                                                                                                               | -                                                                                                                                                   | -                                                                                                                           | -                                                                                                            | -  |
| Corporate securities                                                                       | 107,886                                                 | 1,571                                   | -                                                                                                               | 4,620                                                                                                                                               | (17,424)                                                                                                                         | 96,653                                                                                                       | 1,475  |
| Total trading fixed maturity securities                                                    | 403,494                                                 | (8,306)                                      | -                                                                                                               | (14,266)                                                                                                                                                 | (101,806)                                                                                                                        | 279,116                                                                                                      | 12,004  |
|                                                                                       |                                                                        |                                         |                                                                                                                 |                                                                                                                                                     |                                                                                                                             |                                                                                                              |   |
| Derivative instruments – receivable:                                                 |                                                                        |                                         |                                                                                                                 |                                                                                                                                                     |                                                                                                                             |                                                                                                              |   |
| Interest rate contracts                                                                    | -                                                  | -                                       | -                                                                                                               | -                                                                                                                                                   | -                                                                                                                           | -                                                                                                            | -  |
| Foreign currency contracts                                                                 | -                                                  | -                                       | -                                                                                                               | -                                                                                                                                                   | -                                                                                                                           | -                                                                                                            | -  |
| Equity contracts                                                                           |  8,821                                        | 1,531                                   | -                                                                                                               | 1,604                                                                                                                                               | -                                                                                                                           | 11,956                                                                                                       | 1,531  |
| Futures                                                                                    | -                                                  | -                                       | -                                                                                                               | -                                                                                                                                                   | -                                                                                                                           | -                                                                                                            | -  |
| Total derivative instruments– receivable                                             |  8,821                                        | 1,531                                   | -                                                                                                               | 1,604                                                                                                                                               | -                                                                                                                           | 11,956                                                                                                       | 1,531  |
|                                                                                       |                                                                        |                                         |                                                                                                                 |                                                                                                                                                     |                                                                                                                             |                                                                                                              |   |
| Other invested assets                                                                      | -                                                  | -                                       | -                                                                                                               | -                                                                                                                                                   | -                                                                                                                           | -                                                                                                            | -  |
| Short-term investments                                                                     | -                                                  | -                                       | -                                                                                                               | -                                                                                                                                                   | -                                                                                                                           | -                                                                                                            | -  |
| Cash and cash equivalents                                                                  | -                                                  | -                                       | -                                                                                                               | -                                                                                                                                                   | -                                                                                                                           | -                                                                                                            | -  |
| Total investments and cash                                                                 | 422,218                                                                |  (7,035)                                |  (552)                                                                                                          |  (12,466)                                                                                                                                           |  (108,990)                                                                                                                  | 293,175                                                                                                      | 13,535  |
|                                                                                       |                                                                        |                                         |                                                                                                                 |                                                                                                                                                     |                                                                                                                             |                                                                                                              |   |
| Separate account assets:                                                                   |                                                                        |                                         |                                                                                                                 |                                                                                                                                                     |                                                                                                                             |                                                                                                              |   |
| Mutual fund investments                                                                    | -                                                                 | -                                            | -                                                                                                                    | -                                                                                                                                                        | -                                                                                                                                | -                                                                                                                 | - |
| Equity investments                                                                         | 7                                                                      | -                                            | -                                                                                                                    | -                                                                                                                                                        | -                                                                                                                                | 7                                                                                                                 | - |
| Fixed income investments                                                                   | 276,530                                                                | 6,667                                        | -                                                                                                                    | 30,550                                                                                                                                                   | -                                                                                                                                | 313,747                                                                                                           | 5,752 |
| Alternative investments                                                                    | 267,196                                                           | (465)                                        | -                                                                                                                    | (4,000)                                                                                                                                                  | (2,969)                                                                                                                          | 259,762                                                                                                           | (1,013) |
| Other investments                                                                          | 4,108                                                             | (2,355)                                      | -                                                                                                                    | (1,028)                                                                                                                                                  | -                                                                                                                                | 725                                                                                                               | (3,383) |
| Total separate account assets (1)                                                          | 547,841                                                           | 3,847                                        | -                                                                                                                    | 25,522                                                                                                                                              | (2,969)                                                                                                                          | 574,241                                                                                                           | 1,356 |
|                                                                                       |                                                                        |                                         |                                                                                                                 |                                                                                                                                                     |                                                                                                                             |                                                                                                              |   |
| Total assets measured at fair value on     a recurring basis | $970,059                                                               | $(3,188)                                     | $             (552)                                 | $               13,056                                                   | $       (111,959)                                                                             | $        867,416                                                     | $            14,891  |
|                                                                                       |                                                                        |                                         |                                                                                                                 |                                                                                                                                                     |                                                                                                                             |                                                                                                              |   |

|   | (1) The realized/unrealized gains (losses) included in net income for separate account assets are offset by an equal amount for separate account liabilities which results in a net zero impact on net income for the Company. |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (2) Transfers in and/or (out) of level 3 during the three-month period ended March 31, 2010 are primarily attributable to changes in the observability of inputs used to price the securities. |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

Table of Contents

| Liabilities                                                                                | Beginningbalance                    | Total realized and unrealized (gains) losses |  Purchases,issuances, andsettlements (net)                                  | Transfers inand/or (out) oflevel 3                                              | Ending balance                                                                                | Change in unrealized(gains) losses included inearnings relating toinstruments still held atthe reporting date |
|--------------------------------------------------------------------------------------------|-------------------------------------|----------------------------------------------|----------------------------------------------------------------------------------|---------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------|---------------------------------------------------------------------------------------------------------------|
| Includedinearnings                                                                         | Included inothercomprehensiveincome |
|                                                                                       |                                |                                         |                                                                             |                                                                            |                                                                                               |                                                                                                          |   |
| Other policy liabilities:                                                                  |                                |                                         |                                                                             |                                                                            |                                                                                               |                                                                                                          |   |
| Guaranteed minimum withdrawal benefit    liability                     | $168,786                            | $(92,939)                                    | $             - | $            30,754 | $                - | $106,601                                                                                                      | $                       (92,908) |
| Guaranteed minimum accumulation  benefit    liability        | 81,669                              | (41,679) )                              | -                                                                                | 6,040                                                                           | -                                                                                                  | 46,030                                                                                                        | (41,642) |
| Derivatives embedded in reinsurance    contracts                       | -                                   | -                                            | -                                                                                | -                                                                               | -                                                                                                  | -                                                                                                             | - |
| Fixed index annuities                                                                      | 140,966                             | (5,355)                                      | -                                                                                | 3,401                                                                           | -                                                                                                  | 139,012                                                                                                       | 4,001 |
| Total other policy liabilities                                                             | 391,421                             | (139,973)                                    | -                                                                                | 40,195                                                                          | -                                                                                                  | 291,643                                                                                                       | (130,549) |
|                                                                                       |                                |                                         |                                                                             |                                                                            |                                                                                               |                                                                                                          |   |
| Derivative instruments – payable:                                                    |                                |                                         |                                                                             |                                                                            |                                                                                               |                                                                                                          |   |
| Interest rate contracts                                                                    | -                                   | -                                            | -                                                                                | -                                                                               | -                                                                                                  | -                                                                                                             | - |
| Foreign currency contracts                                                                 | -                                   | -                                            | -                                                                                | -                                                                               | -                                                                                                  | -                                                                                                             | - |
| Credit contracts                                                                           | 34,349                              | 263                                          | -                                                                                | -                                                                               | -                                                                                                  | 34,612                                                                                                        | 263 |
| Futures                                                                                    | -                                   | -                                            | -                                                                                | -                                                                               | -                                                                                                  | -                                                                                                             | - |
| Total derivative instruments – payable                                          | 34,349                              | 263                                          | -                                                                                | -                                                                               | -                                                                                                  | 34,612                                                                                                        | 263 |
|                                                                                       |                                |                                         |                                                                             |                                                                            |                                                                                               |                                                                                                          |   |
|                                                                                       |                                |                                         |                                                                             |                                                                            |                                                                                               |                                                                                                          |   |
| Other liabilities:                                                                         |                                |                                         |                                                                             |                                                                            |                                                                                               |                                                                                                          |   |
| Bank overdrafts                                                                            | -                                   | -                                            | -                                                                                | -                                                                               | -                                                                                                  | -                                                                                                             | - |
|                                                                                       |                                |                                         |                                                                             |                                                                            |                                                                                               |                                                                                                          |   |
| Total liabilities measured at fair value on a     recurring basis | $ 425,770                           | $(139,710)                                   | $             - | $           40,195       | $                - | $ 326,255                                                                                                     | $                      (130,286) |

|                                                                                                                            |   | Total realizedgains (losses)included inearnings |   | Change inunrealized gains(losses) related toassets andliabilities still heldat the reportingdate |
|---------------------------------------------------------------------------------------------------------------------------------|--------|-------------------------------------------------|--------|--------------------------------------------------------------------------------------------------|
| Net investment (loss) income                                                                                                    | $      | (8,306)                                         | $      | 12,004                                                                                      |
| Net derivative income                                                                                                           |   | 141,241                                    |   | 131,817                                                                                     |
| Net realized investment losses, excluding impairment      losses on available-for-sale securities |   | (260)                                           |   | -                                                                                           |
| Net gains                                                                                                                       | $      | 132,675                                    | $      | 143,821                                                                                     |

----

Table of Contents

|                                                                                        | Level 1 Transfers                                                                                                    | Level 2 Transfers                                                                                                          | Level 3 Transfers                                                                                                          |
|---------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------------------------------|
|                                                                                        | Into                                                                                                                 | (Out of)                                                                                                                   | Into                                                                                                                       | (Out of) | Into | (Out of) |
| Assets                                                                                      |                                                                                                                 |                                                                                                                       |                                                                                                                       |   |   |   |
| Available-for-sale fixed maturity securities:                                               |                                                                                                                 |                                                                                                                       |                                                                                                                       |   |   |   |
| Asset-backed securities                                                                     | $                  -  | $                   -  | $                   -  | $                  -  | $                 -  | $                 -  |
| Residential mortgage-backed securities                                                      | -                                                                                                               | -                                                                                                                     | -                                                                                                                     | -  | -  | -  |
| Commercial mortgage-backed securities                                                       | -                                                                                                               | -                                                                                                                     | -                                                                                                                     | -  | -  | -  |
| Foreign government & agency securities                                                  | -                                                                                                               | -                                                                                                                     | -                                                                                                                     | -  | -  | -  |
| U.S. states and political subdivisions     securities              | -                                                                                                               | -                                                                                                                     | -                                                                                                                     | -  | -  | -  |
| U.S. treasury and agency securities                                                         | -                                                                                                               | -                                                                                                                     | -                                                                                                                     | -  | -  | -  |
| Corporate securities                                                                        | -                                                                                                               | -                                                                                                                     | -                                                                                                                     | -  | -  | -  |
| Total available-for-sale fixed maturity      securities       | -                                                                                                               | -                                                                                                                     | -                                                                                                                     | -  | -  | -  |
|                                                                                        |                                                                                                                 |                                                                                                                       |                                                                                                                       |   |   |   |
| Trading fixed maturity securities:                                                          |                                                                                                                 |                                                                                                                       |                                                                                                                       |   |   |   |
| Asset-backed securities                                                                     | -                                                                                                               | -                                                                                                                     | 17,342                                                                                                                | (10,033) | 10,033  | (17,342) |
| Residential mortgage-backed securities                                                      | -                                                                                                               | -                                                                                                                     | 33,731                                                                                                                | (87,338) | 87,338  | (33,731) |
| Commercial mortgage-backed securities                                                       | -                                                                                                               | -                                                                                                                     | -                                                                                                                     | -  | -  | -  |
| Foreign government & agency securities                                                  | -                                                                                                               | -                                                                                                                     | -                                                                                                                     | -  | -  | -  |
| U.S. states and political subdivisions      securities             | -                                                                                                               | -                                                                                                                     | -                                                                                                                     | -  | -  | -  |
| U.S. treasury and agency securities                                                         | -                                                                                                               | -                                                                                                                     | -                                                                                                                     | -  | -  | -  |
| Corporate securities                                                                        | -                                                                                                               | -                                                                                                                     | 35,621                                                                                                                | (3,202) | 3,202  | (35,621) |
| Total trading fixed maturity securities                                                     | -                                                                                                               | -                                                                                                                     | 86,694                                                                                                                | (100,573) | 100,573  | (86,694) |
|                                                                                        |                                                                                                                 |                                                                                                                       |                                                                                                                       |   |   |   |
|                                                                                        |                                                                                                                 |                                                                                                                       |                                                                                                                       |   |   |   |
| Separate account assets:                                                                    |                                                                                                                 |                                                                                                                       |                                                                                                                       |   |   |   |
| Mutual fund investments                                                                     | -                                                                                                               | -                                                                                                                     | -                                                                                                                     | -  | -  | -  |
| Equity investments                                                                          | -                                                                                                               | -                                                                                                                     | -                                                                                                                     | (64) | 64  | -  |
| Fixed income investments                                                                    | (1,244)                                                                                                              | -                                                                                                                     | 18,377                                                                                                                | (32,401) | 32,401  | (17,133) |
| Alternative investments                                                                     | -                                                                                                               | -                                                                                                                     | -                                                                                                                     | (3,200) | 3,200  | -  |
| Other investments                                                                           | -                                                                                                               | -                                                                                                                     | -                                                                                                                     | -  | -  | -  |
| Total separate account assets                                                               | (1,244)                                                                                                              | -                                                                                                                     | 18,377                                                                                                                | (35,665) | 35,665  |   (17,133) |
|                                                                                        |                                                                                                                 |                                                                                                                       |                                                                                                                       |   |   |   |
| Total assets measured at fair value on a      recurring basis | $         (1,244)                                                       | $                  -        | $      105,071                                                                          | $     (136,238) | $      136,238  | $     (103,827) |

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Table of Contents

|                                                                                        | Level 1 Transfers                                                                                                    | Level 2 Transfers                                                                                                          | Level 3 Transfers                                                                                              |
|---------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------------------|
|                                                                                        | Into                                                                                                                 | (Out of)                                                                                                                   | Into                                                                                                           | (Out of) | Into | (Out of) |   |
| Assets                                                                                      |                                                                                                                 |                                                                                                                       |                                                                                                           |   |   |   |   |
|                                                                                        |                                                                                                                 |                                                                                                                       |                                                                                                           |   |   |   |   |
| Available-for-sale fixed maturity securities: Asset-backed securities                       | $                  -  | $                   -  | $                 -  | $                   -  | $                  -  | $                -  |   |
| Residential mortgage-backed securities                                                      | -                                                                                                               | -                                                                                                                     | -                                                                                                         | -  | -  | -  |   |
| Commercial mortgage-backed securities                                                       | -                                                                                                               | -                                                                                                                     | -                                                                                                         | -  | -  | -  |   |
| Foreign government & agency securities                                                  | -                                                                                                               | -                                                                                                                     | -                                                                                                         | -  | -  | -  |   |
| U.S. states and political subdivisions     securities              | -                                                                                                               | -                                                                                                                     | -                                                                                                         | -  | -  | -  |   |
| U.S. treasury and agency securities                                                         | -                                                                                                               | -                                                                                                                     | -                                                                                                         | -  | -  | -  |   |
| Corporate securities                                                                        | -                                                                                                               | -                                                                                                                     | 7,184                                                                                                     | -  | -  | (7,184) |   |
| Total available-for-sale fixed maturity      securities       | -                                                                                                               | -                                                                                                                     | 7,184                                                                                                     | -  | -  | (7,184) |   |
|                                                                                        |                                                                                                                 |                                                                                                                       |                                                                                                           |   |   |   |   |
| Trading fixed maturity securities:                                                          |                                                                                                                 |                                                                                                                       |                                                                                                           |   |   |   |   |
| Asset-backed securities                                                                     | -                                                                                                               | -                                                                                                                     |    47,432                                                                                  |  (9,275) | 9,275  |  (47,432) |   |
| Residential mortgage-backed securities                                                      | -                                                                                                               | -                                                                                                                     |   80,597                                                                                        | (35,068) | 35,068  |  (80,597) |   |
| Commercial mortgage-backed securities                                                       | -                                                                                                               | -                                                                                                                     |             696                               | -  | -  |  (696) |   |
| Foreign government & agency securities                                                  | -                                                                                                               | -                                                                                                                     | -                                                                                                         | -  | -  | -  |   |
| U.S. states and political subdivisions    securities                    | -                                                                                                               | -                                                                                                                     | -                                                                                                         | -  | -  | -  |   |
| U.S. treasury and agency securities                                                         | -                                                                                                               | -                                                                                                                     | -                                                                                                         | -  | -  | -  |   |
| Corporate securities                                                                        | -                                                                                                               | -                                                                                                                     |        17,424                                                          | -  | -  |  (17,424) |   |
| Total trading fixed maturity securities                                                     | -                                                                                                               | -                                                                                                                     |      146,149                                                                     |      (44,343) | 44,343  |  (146,149) |   |
|                                                                                        |                                                                                                                 |                                                                                                                       |                                                                                                           |   |   |   |   |
|                                                                                        |                                                                                                                 |                                                                                                                       |                                                                                                           |   |   |   |   |
| Separate account assets:                                                                    |                                                                                                                 |                                                                                                                       |                                                                                                           |   |   |   |   |
| Mutual fund investments                                                                     | -                                                                                                               | -                                                                                                                     | -                                                                                                         | -  | -  | -  |   |
| Equity investments                                                                          | 3,764                                                                                                           | -                                                                                                                     | -                                                                                                         | (3,764) | -  | -  |   |
| Fixed income investments                                                                    | -                                                                                                               | -                                                                                                                     | -                                                                                                         | -  | -  | -  |   |
| Alternative investments                                                                     | -                                                                                                               | -                                                                                                                     | 2,969                                                                                                     | -  | -  | (2,969) |   |
| Other investments                                                                           | -                                                                                                               | -                                                                                                                     | -                                                                                                         | -  | -  | -  |   |
| Total separate account assets                                                               | 3,764                                                                                                           | -                                                                                                                     | 2,969                                                                                                     | (3,764) | -  | (2,969) |   |
|                                                                                        |                                                                                                                 |                                                                                                                       |                                                                                                           |   |   |   |   |
| Total assets measured at fair value on a      recurring basis | $          3,764                                              | $                  -        | $     156,302                                                                    | $       (48,107) | $        44,343  | $     (156,302) |   |
|                                                                                        |                                                                                                                 |                                                                                                                       |                                                                                                           |   |   |   |   |

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|                   |                                                                             |                                                                             | March 31, 2011                                                                         |       | December 31, 2010                                                          |
|------------------------|----------------------------------------------------------------------------------|----------------------------------------------------------------------------------|----------------------------------------------------------------------------------------|------------|----------------------------------------------------------------------------|
|                   |                                                                             |                                                                             | Carrying                                                                               | Estimated  |                                                                       | Carrying | Estimated |
|                   |                                                                             |                                                                             | Amount                                                                                 | Fair Value |                                                                       | Amount | Fair Value |
| Financial assets:      |                                                                             |                                                                             |                                                                                   |       |                                                                       |
|                   | Mortgage loans                                                                   | $        1,685,060                  | $        1,749,104                        |       | $       1,737,528                  | $       1,811,567  |
|                   | Policy loans                                                                     | $           714,322  | $           850,872        |       | $          717,408  | $          859,668  |
|                   |                                                                             |                                                                             |                                                                                   |       |                                                                       |   |
| Financial liabilities: |                                                                             |                                                                             |                                                                                   |       |                                                                       |
|                   | Contractholder deposit funds and other    policy liabilities | $      11,471,531                             | $       11,141,684                             |       | $     11,944,058                             | $     11,490,525  |
|                   | Debt payable to affiliates                                                       | $           783,000  | $            783,000  |       | $          783,000  | $          783,000  |

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Table of Contents

|                                                                                                   |                                                                                     |                                                                                                           | Gross                                                                                                      |                                                                                                                       |                                                                                     |
|--------------------------------------------------------------------------------------------------------|------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------------------|------------------------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------------------------------|------------------------------------------------------------------------------------------|
| Available-for-sale fixed maturity securities                                                           | AmortizedCost                                                                            | GrossUnrealizedGains                                                                                           | UnrealizedTemporaryLosses                                                                                  | OTTILosses(1)                                                                                                              | FairValue                                                                                |
| Non-corporate securities:                                                                              |                                                                                     |                                                                                                           |                                                                                                       |                                                                                                                       |                                                                                     |
| Asset-backed securities                                                                                | $              210 | $                  7 | $                 (3) | $                   -  | $              214 |
| Residential mortgage-backed securities                                                                 | 29,794                                                                                   | 2,172                                                                                                          | -                                                                                                     | -                                                                                                                     | 31,966                                                                                   |
| Commercial mortgage-backed securities                                                                  | 15,759                                                                                   | 483                                                                                                            | (1,248)                                                                                                    | -                                                                                                                     | 14,994                                                                                   |
| Foreign government & agency securities                                                             | 506                                                                                      | 53                                                                                                             | -                                                                                                     | -                                                                                                                     | 559                                                                                      |
| U.S. states and political subdivisions         securities | 216                                                                                      | -                                                                                                              | (2)                                                                                                        | -                                                                                                                     | 214                                                                                      |
| U.S. treasury and agency securities                                                                    | 479,160                                                                                  | 3,589                                                                                                          | (1,436)                                                                                                    | -                                                                                                                     | 481,313                                                                                  |
| Total non-corporate securities                                                                         | 525,645                                                                                  | 6,304                                                                                                          | (2,689)                                                                                                    | -                                                                                                                     | 529,260                                                                                  |
|                                                                                                   |                                                                                     |                                                                                                           |                                                                                                       |                                                                                                                       |                                                                                     |
| Corporate securities                                                                                   | 994,188                                                                                  | 69,099                                                                                                         | (988)                                                                                                      | (12,304)                                                                                                                   | 1,049,995                                                                                |
|                                                                                                   |                                                                                     |                                                                                                           |                                                                                                       |                                                                                                                       |                                                                                     |
| Total available-for-sale fixed maturity securities                                                     | $    1,519,833                                                       | $         75,403                                                  | $          (3,677)                                       | $       (12,304)                                                                        | $    1,579,255                                                       |
|                                                                                                   |                                                                                     |                                                                                                           |                                                                                                       |                                                                                                                       |                                                                                     |
|                                                                                                   |                                                                                     |                                                                                                           |                                                                                                       |                                                                                                                       |                                                                                     |
| Trading fixed maturity securities                                                                      | AmortizedCost                                                                            | GrossUnrealizedGains                                                                                           | GrossUnrealizedLosses                                                                                      | FairValue                                                                                                                  |                                                                                     |
| Non-corporate securities:                                                                              |                                                                                     |                                                                                                           |                                                                                                       |                                                                                                                       |                                                                                     |
| Asset-backed securities                                                                                | $       523,772                                       | $         10,854                                                  | $      (130,692)                                                             | $        403,934                                                                   |                                                                                     |
| Residential mortgage-backed securities                                                                 | 1,117,269                                                                                | 16,163                                                                                                         | (231,989)                                                                                                  | 901,443                                                                                                                    |                                                                                     |
| Commercial mortgage-backed securities                                                                  | 900,858                                                                                  | 59,948                                                                                                         | (101,650)                                                                                                  | 859,156                                                                                                                    |                                                                                     |
| Foreign government & agency securities                                                             | 120,994                                                                                  | 7,407                                                                                                          | -                                                                                                     | 128,401                                                                                                                    |                                                                                     |
| U.S. states and political subdivisions         securities | 604                                                                                      | 5                                                                                                              | -                                                                                                     | 609                                                                                                                        |                                                                                     |
| U.S. treasury and agency securities                                                                    | 815,149                                                                                  | 2,309                                                                                                          | (2,084)                                                                                                    | 815,374                                                                                                                    |                                                                                     |
| Total non-corporate securities                                                                         | 3,478,646                                                                                | 96,686                                                                                                         | (466,415)                                                                                                  | 3,108,917                                                                                                                  |                                                                                     |
|                                                                                                   |                                                                                     |                                                                                                           |                                                                                                       |                                                                                                                       |                                                                                     |
| Corporate securities                                                                                   | 8,052,744                                                                                | 356,332                                                                                                        | (108,123)                                                                                                  | 8,300,953                                                                                                                  |                                                                                     |
|                                                                                                   |                                                                                     |                                                                                                           |                                                                                                       |                                                                                                                       |                                                                                     |
| Total trading fixed maturity securities                                                                | $  11,531,390                                                                  | $       453,018                                                             | $      (574,538)                                                             | $   11,409,870                                                                                              |                                                                                     |

|   | (1)  Represents the pre-tax non-credit OTTI loss recorded as a component of accumulated other comprehensive income (“AOCI”) for assets still held at the reporting date. |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| Available-for-sale fixed maturity securities       | AmortizedCost                                                                            | GrossUnrealizedGains                                                                                | UnrealizedTemporaryLosses                                                                                        | OTTILosses(1)                                                                                                        | FairValue                                                                                      |
|----------------------------------------------------|------------------------------------------------------------------------------------------|-----------------------------------------------------------------------------------------------------|------------------------------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------------------------|------------------------------------------------------------------------------------------------|
| Non-corporate securities:                          |                                                                                     |                                                                                                |                                                                                                             |                                                                                                                 |                                                                                           |
| Asset-backed securities                            | $              694 | $                27 | $                  (6) | $                  -  | $               715 |
| Residential mortgage-backed securities             | 32,263                                                                                   | 2,351                                                                                               | -                                                                                                           | -                                                                                                               | 34,614                                                                                         |
| Commercial mortgage-backed securities              | 15,952                                                                                   | 522                                                                                                 | (1,424)                                                                                                          | -                                                                                                               | 15,050                                                                                         |
| Foreign government & agency securities         | 506                                                                                      | 57                                                                                                  | -                                                                                                           | -                                                                                                               | 563                                                                                            |
| U.S. states and political subdivision securities   | 217                                                                                      | -                                                                                                   | (3)                                                                                                              | -                                                                                                               | 214                                                                                            |
| U.S. treasury and agency securities                | 371,704                                                                                  | 4,500                                                                                               | (971)                                                                                                            | -                                                                                                               | 375,233                                                                                        |
| Total non-corporate securities                     | 421,336                                                                                  | 7,457                                                                                               | (2,404)                                                                                                          | -                                                                                                               | 426,389                                                                                        |
|                                               |                                                                                     |                                                                                                |                                                                                                             |                                                                                                                 |                                                                                           |
| Corporate securities                               | 1,001,615                                                                                | 82,490                                                                                              | (2,267)                                                                                                          | (12,304)                                                                                                             | 1,069,534                                                                                      |
|                                               |                                                                                     |                                                                                                |                                                                                                             |                                                                                                                 |                                                                                           |
| Total available-for-sale fixed maturity securities | $    1,422,951                                                       | $         89,947                                       | $           (4,671)                                       | $       (12,304)                                                                  | $     1,495,923                                                       |
|                                               |                                                                                     |                                                                                                |                                                                                                             |                                                                                                                 |                                                                                           |
|                                               |                                                                                     |                                                                                                |                                                                                                             |                                                                                                                 |                                                                                           |
| Trading fixed maturity securities                  | AmortizedCost                                                                            | Gross UnrealizedGains                                                                               | Gross UnrealizedLosses                                                                                           | FairValue                                                                                                            |                                                                                           |
| Non-corporate securities:                          |                                                                                     |                                                                                                |                                                                                                             |                                                                                                                 |                                                                                           |
| Asset-backed securities                            | $       544,106                                       | $         10,104                                       | $       (142,230)                                                             | $        411,980                                                             |                                                                                           |
| Residential mortgage-backed securities             | 1,184,184                                                                                | 17,259                                                                                              | (278,650)                                                                                                        | 922,793                                                                                                              |                                                                                           |
| Commercial mortgage-backed securities              | 917,650                                                                                  | 42,368                                                                                              | (140,823)                                                                                                        | 819,195                                                                                                              |                                                                                           |
| Foreign government & agency securities         | 122,537                                                                                  | 8,239                                                                                               | -                                                                                                           | 130,776                                                                                                              |                                                                                           |
| U.S. states and political subdivision securities   | 605                                                                                      | 8                                                                                                   | -                                                                                                           | 613                                                                                                                  |                                                                                           |
| U.S. treasury and agency securities                | 745,460                                                                                  | 3,037                                                                                               | (878)                                                                                                            | 747,619                                                                                                              |                                                                                           |
| Total non-corporate securities                     | 3,514,542                                                                                | 81,015                                                                                              | (562,581)                                                                                                        | 3,032,976                                                                                                            |                                                                                           |
|                                               |                                                                                     |                                                                                                |                                                                                                             |                                                                                                                 |                                                                                           |
| Corporate securities                               | 8,195,874                                                                                | 368,893                                                                                             | (130,625)                                                                                                        | 8,434,142                                                                                                            |                                                                                           |
|                                               |                                                                                     |                                                                                                |                                                                                                             |                                                                                                                 |                                                                                           |
| Total trading fixed maturity securities            | $  11,710,416                                                                  | $       449,908                                                  | $       (693,206)                                                             | $   11,467,118                                                                                        |                                                                                           |

|   | (1)  Represents the pre-tax non-credit OTTI loss recorded as a component of AOCI for assets still held at the reporting date.  |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------|

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|                                                                                                                           |                                                    |                                                                                                          |                                                                                                                | Amortized Cost | Fair Value |
|--------------------------------------------------------------------------------------------------------------------------------|---------------------------------------------------------|---------------------------------------------------------------------------------------------------------------|---------------------------------------------------------------------------------------------------------------------|----------------|------------|
| Maturities of available-for-sale fixed securities:                                                                             |                                                    |                                                                                                          |
|                                                                                                                           | Due in one year or less                                 | $                 28,852 | $                  29,217 |
|                                                                                                                           | Due after one year through five years                   | 773,143                                                                                                       | 818,278                                                                                                             |
|                                                                                                                           | Due after five years through ten years                  | 99,263                                                                                                        | 103,117                                                                                                             |
|                                                                                                                           | Due after ten years                                     |                                                                                                          |                                                                                                                | 572,812        | 581,469    |
|           Subtotal – Maturities of available-for-sale fixed securities |                                                    | 1,474,070                                                                                                     | 1,532,081                                                                                                           |
| ABS, RMBS and CMBS securities(1)                                                                                               |                                                    | 45,763                                                                                                        | 47,174                                                                                                              |
|           Total available-for-sale fixed securities                          |                                                    | $            1,519,833                            | $             1,579,255                            |
|                                                                                                                           |                                                    |                                                                                                          |                                                                                                                |
| Maturities of trading fixed securities:                                                                                        |                                                    |                                                                                                          |
|                                                                                                                           | Due in one year or less                                 | $           1,270,571                                  | $             1,284,617                            |
|                                                                                                                           | Due after one year through five years                   | 4,464,381                                                                                                     | 4,636,733                                                                                                           |
|                                                                                                                           | Due after five years through ten years                  | 1,805,203                                                                                                     | 1,903,897                                                                                                           |
|                                                                                                                           | Due after ten years                                     | 1,449,336                                                                                                     | 1,420,090                                                                                                           |
|                                                                                                                           | Subtotal – Maturities of trading fixed securities | 8,989,491                                                                                                     | 9,245,337                                                                                                           |
| ABS, RMBS and CMBS securities(1)                                                                                               | 2,541,899                                               | 2,164,533                                                                                                     |
|                                                                                                                           | Total trading fixed securities                          | $         11,531,390                                             | $           11,409,870                                       |

|   | (1) | ABS, RMBS and CMBS securities are shown separately in the table as they are not due at a single maturity. |
|--------|-----|-----------------------------------------------------------------------------------------------------------|

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|                                                        |  Less than Twelve Months |                                                                                   |  Twelve Months or More                                                            |   |  Total  |
|-------------------------------------------------------------|-------------------------------|----------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------|--------|--------------|
|                                                        |  No.(1)                  |  FairValue                                                                        | GrossUnrealizedLosses                                                                  |   |  No.(1) |  FairValue | GrossUnrealizedLosses |   |  No.(1) |  FairValue | GrossUnrealizedLosses |
|                                                        |                          |                                                                                   |                                                                                   |   |         |   |   |   |   |   |   |
| Non-corporate securities:                                   |                          |                                                                                   |                                                                                   |   |         |   |   |   |   |   |   |
| Asset-backed securities                                     | -                             | $              - | $             -  |   | 1            | $             7 | $            (3) |   | 1 | $             7 | $            (3) |
| Residential mortgage-backed securities                      | 1                             | 25                                                                                     | -                                                                                 |   | -            | - | -  |   | 1 | 25 | -  |
| Commercial mortgage-backed securities                       | 1                             | 488                                                                                    | (10)                                                                                   |   | 4            | 2,089 | (1,238) |   | 5 | 2,577 | (1,248) |
| U.S. states and political subdivisions                      | 1                             | 214                                                                                    | (2)                                                                                    |   | -            | - | -  |   | 1 | 214 | (2) |
|     U.S. treasury and agency securities | 2                             | 23,181                                                                                 | (1,436)                                                                                |   | -            | - | -  |   | 2 | 23,181 | (1,436) |
| Total non-corporate securities                              | 5                             | 23,908                                                                                 | (1,448)                                                                                |   | 5            | 2,096 | (1,241) |   | 10 | 26,004 | (2,689) |
|                                                        |                          |                                                                                   |                                                                                   |   |         |   |   |   |   |   |   |
| Corporate securities                                        | 61                            | 166,416                                                                                | (5,158)                                                                                |   | 44           | 119,496 | (8,134) |   | 105 | 285,912 | (13,292) |
| Total                                                       | 66                            | $   190,324                                                             | $    (6,606)                                                       |   | 49           | $  121,592 | $     (9,375) |   | 115 | $  311,916 | $   (15,981) |

|                                       |  Less than Twelve Months |                                                                                         |  Twelve Months or More                                                                  |   |  Total  |
|--------------------------------------------|-------------------------------|----------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------|--------|--------------|
|                                       |  No.(1)                  |  FairValue                                                                              | GrossUnrealizedLosses                                                                        |   |  No.(1) |  FairValue | GrossUnrealizedLosses |   |  No.(1) |  FairValue | GrossUnrealizedLosses |
|                                       |                          |                                                                                         |                                                                                         |   |         |   |   |   |   |   |   |
| Non-corporate securities:                  |                          |                                                                                         |                                                                                         |   |         |   |   |   |   |   |   |
| Asset-backed securities                    | -                             | $               - | $               - |   | 1            | $           11 | $           (6) |   | 1 | $           11 | $            (6) |
| Residential mortgage-backed securities     | 1                             | 26                                                                                           | -                                                                                            |   | -            | - | - |   | 1 | 26 | - |
| Commercial mortgage-backed securities      | -                             | -                                                                                            | -                                                                                            |   | 5            | 2,534 | (1,424) |   | 5 | 2,534 | (1,424) |
| Foreign government & agency securities | -                             | -                                                                                            | -                                                                                            |   | -            | - | - |   | - | - | - |
| U.S. states and political subdivisions     | 1                             | 214                                                                                          | (3)                                                                                          |   | -            | - | - |   | 1 | 214 | (3) |
| U.S. treasury and agency securities        | 2                             | 23,636                                                                                       | (971)                                                                                        |   | -            | - | - |   | 2 | 23,636 | (971) |
| Total non-corporate securities             | 4                             | 23,876                                                                                       | (974)                                                                                        |   | 6            | 2,545 | (1,430) |   | 10 | 26,421 | (2,404) |
|                                       |                          |                                                                                         |                                                                                         |   |         |   |   |   |   |   |   |
|  Corporate securities                 | 72                            | 187,916                                                                                      | (5,211)                                                                                      |   | 35           | 91,154 | (9,360) |   | 107 | 279,070 | (14,571) |
| Total                                      | 76                            | $    211,792                                                             | $     (6,185)                                                       |   | 41           | $    93,699 | $   (10,790) |   | 117 | $  305,491 | $   (16,975) |

| (1) | These columns present the number of securities (not in thousands) in an unrealized loss position. |
|-----|---------------------------------------------------------------------------------------------------|

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|                                                                                      |   | 2011        |   |   | 2010        |
|-------------------------------------------------------------------------------------------|--------|-------------|--------|--------|-------------|
|                                                                                      |   |        |   |   |        |
| Beginning balance, at January 1,                                                          | $      | 5,847  |   | $      | 9,148  |
| Add: Credit losses on OTTI not previously recognized                                      |   | 71     |   |   | 885    |
| Less: Credit losses on securities sold                                                    |   | (3,944)     |   |   | (968)       |
| Less: Increases in cash flows expected on previously   impaired securities |   | -      |   |   | (1,089)     |
| Other                                                                                     |   | 3,341  |   |   | -      |
| Ending balance, at March 31,                                                              | $      | 5,315  |   | $      | 7,976  |

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|                 |                                                                   | March 31,2011                                  | December 31,2010 |
|----------------------|------------------------------------------------------------------------|------------------------------------------------|------------------|
|                 |                                                                   |                                           |
| Total mortgage loans | $          1,685,060 | $      1,737,528 |

|                                                                                 | Gross Carrying Value                                                                                                                   |
|--------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                 | March 31,                                                                                                                              | December 31, |
|                                                                                 | 2011                                                                                                                                   | 2010 |
| Past due:                                                                            |                                                                                                                                   |   |
| Between 30 and 59 days                                                               | $            19,889                                                        | $            16,607 |
| Between 60 and 89 days                                                               | -                                                                                                                                      | 12,333 |
| 90 days or more                                                                      | 24,781                                                                                                                                 | 19,310 |
| Total past due                                                                       | 44,670                                                                                                                                 | 48,250 |
| Current (1)                                                                          | 1,693,512                                                                                                                              | 1,743,060 |
| Total mortgage loans                                                                 | $       1,738,182                                                                                   | $       1,791,310 |
| Past due more than 90 days with total      accrued interest | $                      - | $                      - |

|               | Allowance for Loan Loss                                                         |
|--------------------|---------------------------------------------------------------------------------|
|               | March 31,                                                                       | December 31, |
|               | 2011                                                                            | 2010 |
|               |                                                                            |   |
| General allowance  |  $           23,662 | $            23,662 |
| Specific allowance | 29,460                                                                          | 30,120 |
| Total              | $            53,122 | $            53,782 |

| (1) | Included in the $1,693.5 million and $1,743.1 million of the Company’s mortgage loans in current status at March 31, 2011 and December 31, 2010 are $174.7 million and $165.6 million, respectively, of mortgage loans that are impaired but not past due. |
|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|         | March 31,                                                                                                                                                                        | December 31,                                                                                                                                                                     |
|--------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|         | 2011                                                                                                                                                                             | 2010                                                                                                                                                                             |
| Insured      | $                             - | $                             - |
| High         | 381,309                                                                                                                                                                          | 394,288                                                                                                                                                                          |
| Standard     | 520,039                                                                                                                                                                          | 544,243                                                                                                                                                                          |
| Satisfactory | 314,799                                                                                                                                                                          | 333,086                                                                                                                                                                          |
| Low quality  | 522,035                                                                                                                                                                          | 519,693                                                                                                                                                                          |
| Total        | $              1,738,182                                                                                   | $              1,791,310                                                                                   |

|                        | With no allowance recorded                                                                 |   | With an allowance recorded                                                                                                             |   | Total                                                                                                  |
|-----------------------------|--------------------------------------------------------------------------------------------|--------|----------------------------------------------------------------------------------------------------------------------------------------|--------|--------------------------------------------------------------------------------------------------------|
| Gross carrying value        | $         132,670                        |   | $           83,749                                                         |   | $           216,419                        |
| Unpaid principal balance    | 134,211                                                                               |   | 88,042                                                                                                                            |   | 222,253                                                                                           |
| Related allowance           | -                                                                                     |   | 29,460                                                                                                                            |   | 29,460                                                                                            |
| Average recorded investment | 125,997                                                                               |   | 84,515                                                                                                                            |   | 210,512                                                                                           |
| Interest income recognized  | $             1,462  |   | $                     -  |   | $               1,462  |

|                        | With no allowance recorded                                                                 |   | With an allowance recorded                                                                                                             |   | Total                                                                                                  |
|-----------------------------|--------------------------------------------------------------------------------------------|--------|----------------------------------------------------------------------------------------------------------------------------------------|--------|--------------------------------------------------------------------------------------------------------|
| Gross carrying value        | $         119,323                        |   | $           85,281                                                         |   | $           204,604                        |
| Unpaid principal balance    | 120,417                                                                               |   | 88,625                                                                                                                            |   | 209,042                                                                                           |
| Related allowance           | -                                                                                     |   | 30,120                                                                                                                            |   | 30,120                                                                                            |
| Average recorded investment | 113,701                                                                               |   |  86,575                                                                                                                      |   | 200,276                                                                                           |
| Interest income recognized  | $             5,899  |   | $                     -  |   | $               5,899  |

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|                     | March 31,2011 |         |   | December 31,2010 |
|--------------------------|---------------|--------------|--------|------------------|
|                     |          |         |   |             |   |
| Beginning balance        | $             | 53,782  |   | $                | 42,782  |
| Provisions for allowance |          | 940     |   |             | 26,742  |
| Charge-offs              |          | (28)         |   |             | (6,892) |
| Recoveries               |          | (1,572)      |   |             | (8,850) |
| Ending balance           | $             | 53,122  |   | $                | 53,782  |

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|                 |  March 31, 2011 | December 31, 2010                                                                        |
|----------------------|----------------------|------------------------------------------------------------------------------------------|
|                 | Number of Contracts  | PrincipalNotional (2)                                                                    | Number of Contracts | PrincipalNotional (2) |
|                 |                 |                                                                                     |   |   |
| Interest rate swaps  | 65              | $            5,220,000  | 70  | $            5,443,500  |
| Currency swaps       | 6               | 335,775                                                                             | 7  | 349,460  |
| Credit default swaps | 1               | 37,400                                                                              | 1  | 37,400  |
| Currency forwards    | 30              | 38,498                                                                              | 36  | 44,149  |
| Swaptions            | -               | -                                                                                   | 1  | 350,000  |
| Futures (1)          | (22,835)             | 2,996,856                                                                           | (25,699) | 2,918,839  |
| Index call options   | 9,580           | 1,922,136                                                                           | 9,604  | 1,858,109  |
| Index put options    | 3,650           | 483,928                                                                             | 4,100  | 515,632  |
| Total                |                 | $          11,034,593             |   | $          11,517,089  |

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|                       | At March 31, 2011                         | At December 31, 2010                                                      |
|----------------------------|-------------------------------------------|---------------------------------------------------------------------------|
|                       |     Asset Derivatives |    Liability    Derivatives            |     Asset Derivatives |              Liability               Derivatives |
|                       |                                      | Fair Value (a)                                                            |   | Fair Value (a) |   | Fair Value (a) |   | Fair Value (a) |
|                       |                                      |                                                                      |   |   |   |   |   |   |
| Interest rate contracts    |                                      | $          65,086  |   | $         281,475  |   | $          97,060  |   | $       329,214  |
| Foreign currency contracts |                                      | 40,208                                                               |   | 3,990  |   | 32,504  |   | 3,878  |
| Equity contracts           |                                      | 95,282                                                               |   | -  |   | 59,397  |   | -  |
| Credit contracts           |                                      | -                                                                    |   | 23,846  |   | -  |   | 27,341  |
| Futures contracts (b)      |                                      | 5,334                                                                |   | 2,454  |   | 9,103  |   | 1,590  |
| Derivative instruments     |                                      | 205,910                                                              |   | 311,765  |   | 198,064  |   | 362,023  |
| Embedded derivatives (c)   |                                      | 157,785                                                              |   | 223,291  |   | 2,896  |   | 178,069  |
| Total                      |                                      | $        363,695             |   | $         535,056  |   | $        200,960  |   | $       540,092  |

| (a) | Amounts are presented without consideration of cross-transaction netting and collateral. |
|-----|------------------------------------------------------------------------------------------|

| (b) | Futures contracts include interest rate, equity price and foreign currency exchange risks. |
|-----|--------------------------------------------------------------------------------------------|

| (c) | Embedded derivatives expose the Company to a combination of credit, interest rate and equity price risks. |
|-----|-----------------------------------------------------------------------------------------------------------|

|                         | 2011   |          | 2010   |
|------------------------------|--------|---------------|--------|
|                         |   |          |   |   |   |
| Interest rate contracts      | $      | (8,922)       |   | $ | (42,444) |
| Foreign currency contracts   |   | (2,623)       |   |   | (3,459) |
| Equity contracts             |   | 10,504   |   |   | (5,229) |
| Credit contracts             |   | 3,495    |   |   | (263) |
| Futures contracts            |   | (120,880)     |   |   | (71,775) |
| Embedded derivatives         |   | 146,196  |   |   | 81,720  |
| Net derivative income (loss) | $      | 27,770   |   | $ | (41,450) |

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|                                                                 | March 31, |      | December 31, |
|----------------------------------------------------------------------|-----------|-----------|--------------|
|                                                                 | 2011      |      | 2010         |
| AssetsReinsurance receivable                                         | $         | 1,455,402 |         | $ | 1,466,247 |
|                                                                 |      |      |         |   |   |
| LiabilitiesContractholder deposit funds and other policy liabilities |      | 1,467,552 |         |   | 1,478,459 |
| Future contract and policy benefits                                  |      | 1,823     |         |   | 1,823 |
| Reinsurance payable                                                  | $         | 1,541,760 |         | $ | 1,555,336 |

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|                                                                 | March 31, |    | December 31, |
|----------------------------------------------------------------------|-----------|---------|--------------|
|                                                                 | 2011      |    | 2010         |
| AssetsReinsurance receivable                                         | $         | 415,868 |         | $ | 419,684 |
|                                                                 |      |    |         |   |   |
| LiabilitiesContractholder deposit funds and other policy liabilities |      | 453,190 |         |   | 465,035 |
| Reinsurance payable                                                  | $         | 424,909 |         | $ | 432,160 |

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|                                                                 | March 31, |    | December 31, |
|----------------------------------------------------------------------|-----------|---------|--------------|
|                                                                 | 2011      |    | 2010         |
| AssetsReinsurance receivable                                         | $         | 136,839 |         | $ | 133,088 |
|                                                                 |      |    |         |   |   |
| LiabilitiesContractholder deposit funds and other policy liabilities |      | 102,622 |         |   | 104,795 |
| Future contract and policy benefits                                  |      | 19,970  |         |   | 21,662 |
| Reinsurance payable                                                  | $         | 229,618 |         | $ | 225,387 |

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| Benefit Type                      | Account Balance                                                                                          | Net Amountat Risk 1                                                                               | AverageAttained Age |
|-----------------------------------|----------------------------------------------------------------------------------------------------------|---------------------------------------------------------------------------------------------------|---------------------|
| Minimum death                     | $           20,888,476                            | $          1,570,297                            | 66.7           |
| Minimum income                    | $                172,696 | $               51,790 | 62.4           |
| Minimum accumulation orwithdrawal | $           13,077,309                            | $               93,264 | 64.1           |

| Benefit Type                                                    | Account Balance                                                                                          | Net Amountat Risk 1                                                                                     | AverageAttained Age |
|-----------------------------------------------------------------|----------------------------------------------------------------------------------------------------------|---------------------------------------------------------------------------------------------------------|---------------------|
| Minimum death                                                   | $           20,061,043                            | $           1,742,139                            | 66.0           |
| Minimum income                                                  | $                179,878 | $                59,322 | 62.2           |
| Minimum accumulation or     withdrawal | $           12,233,731                            | $              152,571            | 63.2           |

|                                                                   | GuaranteedMinimumDeath Benefit                                                                     |   | GuaranteedMinimumIncome Benefit                                                 |   | Total                                                                      |
|------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------|--------|---------------------------------------------------------------------------------|--------|----------------------------------------------------------------------------|
| Balance at December 31, 2010                                           | $              123,605  |   | $           14,630  |   | $          138,235  |
|                                                                   |                                                                                               |   |                                                                            |   |                                                                       |
| Benefit ratio change /     Assumption changes | (4,873)                                                                                            |   | (2,783)                                                                         |   | (7,656)                                                                    |
| Incurred guaranteed benefits                                           | 4,879                                                                                         |   | 284                                                                        |   | 5,163                                                                 |
| Paid guaranteed benefits                                               | (9,283)                                                                                            |   | (368)                                                                           |   | (9,651)                                                                    |
| Interest                                                               | 2,149                                                                                         |   | 249                                                                        |   | 2,398                                                                 |
|                                                                   |                                                                                               |   |                                                                            |   |                                                                       |
| Balance at March 31, 2011                                              | $              116,477  |   | $           12,012  |   | $          128,489  |

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|                                                                   | GuaranteedMinimumDeath Benefit                                                                          |   | GuaranteedMinimumIncome Benefit                                                            |   | Total                                                                     |
|------------------------------------------------------------------------|---------------------------------------------------------------------------------------------------------|--------|--------------------------------------------------------------------------------------------|--------|---------------------------------------------------------------------------|
| Balance at December 31, 2009                                           | $               96,267  |   | $           10,058             |   | $      106,325                         |
|                                                                   |                                                                                                    |   |                                                                                       |   |                                                                      |
| Benefit ratio change /     Assumption changes |  (7,222)                                                                                           |   | (400)                                                                                      |   | (7,622)                                                                   |
| Incurred guaranteed benefits                                           | 2,086                                                                                              |   | 360                                                                                   |   |  2,446                                                          |
| Paid guaranteed benefits                                               |  (7,134)                                                                                           |   |  (1,296)                                                                              |   |  (8,430)                                                             |
| Interest                                                               | 6,768                                                                                              |   |  178                                                                             |   |   6,946                                                    |
|                                                                   |                                                                                                    |   |                                                                                       |   |                                                                      |
| Balance at March 31, 2010                                              | $               90,765  |   | $             8,900  |   | $           99,665 |

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|                                                                                                                  | SLUSas Parent |          |  SLNY |   | OtherSubs    |   |  Elimination |        | ConsolidatedCompany |
|-----------------------------------------------------------------------------------------------------------------------|---------------|---------------|------------|--------|--------------|--------|-------------------|-------------|---------------------|
|                                                                                                                  |          |          |       |   |         |   |              |        |                |   |   |   |   |   |
| Revenues                                                                                                              |          |          |       |   |         |   |              |        |                |   |   |   |   |   |
|                                                                                                                  |          |          |       |   |         |   |              |        |                |   |   |   |   |   |
| Premiums and annuity considerations                                                                                   | $             | 5,004    |       | $      | 29,273  |   | $                 | -      |                | $ | -  |   | $ | 34,277  |
| Net investment income (1)                                                                                             |          | 268,098  |       |   | 23,422  |   |              | 478    |                |   | -  |   |   | 291,998  |
| Net derivative income                                                                                                 |          | 12,591   |       |   | 15,179  |   |              | -      |                |   | -  |   |   | 27,770  |
| Net realized investment gains (losses), excluding   impairment losses on available-for-sale securities |          | 4,450    |       |   | (453)        |   |              | 86     |                |   | -  |   |   | 4,083  |
| Other-than-temporary impairment losses                                                                                |          | (71)          |       |   | -       |   |              | -      |                |   | -  |   |   | (71) |
| Fee and other income                                                                                                  |          | 138,313  |       |   | 6,474   |   |              | 3,234  |                |   | -  |   |   | 148,021  |
|                                                                                                                  |          |          |       |   |         |   |              |        |                |   |   |   |   |   |
| Total revenues                                                                                                        |          | 428,385  |       |   | 73,895  |   |              | 3,798  |                |   | -  |   |   | 506,078  |
|                                                                                                                  |          |          |       |   |         |   |              |        |                |   |   |   |   |   |
| Benefits and Expenses                                                                                                 |          |          |       |   |         |   |              |        |                |   |   |   |   |   |
|                                                                                                                  |          |          |       |   |         |   |              |        |                |   |   |   |   |   |
| Interest credited                                                                                                     |          | 74,452   |       |   | 13,190  |   |              | 234    |                |   | -  |   |   | 87,876  |
| Interest expense                                                                                                      |          | 11,092   |       |   | -       |   |              | -      |                |   | -  |   |   | 11,092  |
| Policyowner benefits                                                                                                  |          | 21,394   |       |   | 23,518  |   |              | 55     |                |   | -  |   |   | 44,967  |
| Amortization of DAC, VOBA and VOCRA                                                                                   |          | 238,702  |       |   | 9,412   |   |              | -      |                |   | -  |   |   | 248,114  |
| Other operating expenses                                                                                              |          | 74,646   |       |   | 11,716  |   |              | 3,123  |                |   | -  |   |   | 89,485  |
|                                                                                                                  |          |          |       |   |         |   |              |        |                |   |   |   |   |   |
| Total benefits and expenses                                                                                           |          | 420,286  |       |   | 57,836  |   |              | 3,412  |                |   | -  |   |   | 481,534  |
|                                                                                                                  |          |          |       |   |         |   |              |        |                |   |   |   |   |   |
| Income before income tax (benefit) expense                                                                            |          | 8,099    |       |   | 16,059  |   |              | 386    |                |   | -  |   |   | 24,544  |
|                                                                                                                  |          |          |       |   |         |   |              |        |                |   |   |   |   |   |
| Income tax (benefit) expense                                                                                          |          | (1,466)       |       |   | 5,453   |   |              | 172    |                |   | -  |   |   | 4,159  |
| Equity in the net income of subsidiaries                                                                              |          | 10,820   |       |   | -       |   |              | -      |                |   | (10,820) |   |   | -  |
|                                                                                                                  |          |          |       |   |         |   |              |        |                |   |   |   |   |   |
| Net income                                                                                                            | $             | 20,385   |       | $      | 10,606  |   | $                 | 214    |                | $ | (10,820) |   | $ | 20,385  |

|  (1) | SLUS’, SLNY’s and Other Subs’ net investment income includes an increase (decrease) in market value of trading fixed maturity securities of $122.3 million, $(0.9) million and $0.0 million, respectively, for the three-month period ended March 31, 2011. |
|-----------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|                                                                                                                                      | SLUSas Parent |          |  SLNY |   | OtherSubs     |   |  Elimination |        | ConsolidatedCompany |
|-------------------------------------------------------------------------------------------------------------------------------------------|---------------|---------------|------------|--------|---------------|--------|-------------------|-------------|---------------------|
|                                                                                                                                      |          |          |       |   |          |   |              |        |                |   |   |   |   |   |
| Revenues                                                                                                                                  |          |          |       |   |          |   |              |        |                |   |   |   |   |   |
|                                                                                                                                      |          |          |       |   |          |   |              |        |                |   |   |   |   |   |
| Premiums and annuity considerations                                                                                                       | $             | 5,091    |       | $      | 29,973   |   | $                 | -      |                | $ | -  |   | $ | 35,064  |
| Net investment income (1)                                                                                                                 |          | 404,410  |       |   | 38,299   |   |              | 1,120  |                |   | -  |   |   | 443,829  |
| Net derivative (loss) income                                                                                                              |          | (47,949)      |       |   | 6,499    |   |              | -      |                |   | -  |   |   | (41,450) |
| Net realized investment gains, excluding    impairment losses on available-for-sale    securities |          | 4,370    |       |   | 396      |   |              | 399    |                |   | -  |   |   | 5,165  |
| Other-than-temporary impairment losses                                                                                                    |          | (735)         |       |   | (150)         |   |              | -      |                |   | -  |   |   | (885) |
| Fee and other income                                                                                                                      |          | 108,717  |       |   | 5,007    |   |              | 2,029  |                |   | -  |   |   | 115,753  |
|                                                                                                                                      |          |          |       |   |          |   |              |        |                |   |   |   |   |   |
| Total revenues                                                                                                                            |          | 473,904  |       |   | 80,024   |   |              | 3,548  |                |   | -  |   |   | 557,476 |
|                                                                                                                                      |          |          |       |   |          |   |              |        |                |   |   |   |   |   |
| Benefits and Expenses                                                                                                                     |          |          |       |   |          |   |              |        |                |   |   |   |   |   |
|                                                                                                                                      |          |          |       |   |          |   |              |        |                |   |   |   |   |   |
| Interest credited                                                                                                                         |          | 76,656   |       |   | 12,533   |   |              | 194    |                |   | -  |   |   | 89,383  |
| Interest expense                                                                                                                          |          | 17,112   |       |   | (15)          |   |              | -      |                |   | -  |   |   | 17,097  |
| Policyowner benefits                                                                                                                      |          | 10,586   |       |   | 23,984   |   |              | 33     |                |   | -  |   |   | 34,603  |
| Amortization of DAC, VOBA and VOCRA                                                                                                       |          | 135,321  |       |   | 36,388   |   |              | -      |                |   | -  |   |   | 171,709  |
| Other operating expenses                                                                                                                  |          | 69,986   |       |   | 8,982    |   |              | 1,942  |                |   | -  |   |   | 80,910  |
|                                                                                                                                      |          |          |       |   |          |   |              |        |                |   |   |   |   |   |
| Total benefits and expenses                                                                                                               |          | 309,661  |       |   | 81,872   |   |              | 2,169  |                |   | -  |   |   | 393,702  |
|                                                                                                                                      |          |          |       |   |          |   |              |        |                |   |   |   |   |   |
| Income (loss) before income tax expense (benefit)                                                                                         |          | 164,243  |       |   | (1,848)       |   |              | 1,379  |                |   | -  |   |   | 163,774  |
|                                                                                                                                      |          |          |       |   |          |   |              |        |                |   |   |   |   |   |
| Income tax expense (benefit)                                                                                                              |          | 52,485   |       |   | (783)         |   |              | 421    |                |   | -  |   |   | 52,123  |
| Equity in the net loss of subsidiaries                                                                                                    |          | (107)         |       |   | -        |   |              | -      |                |   | 107  |   |   | -  |
|                                                                                                                                      |          |          |       |   |          |   |              |        |                |   |   |   |   |   |
| Net income (loss)                                                                                                                         | $             | 111,651  |       | $      | (1,065)  |   | $                 | 958    |                | $ | 107  |   | $ | 111,651  |

| (1) | SLUS’, SLNY’s and Other Subs’ net investment income includes an increase in market value of trading fixed maturity securities of $253.3 million, $17.1 million and $0.0 million, respectively, for the three-month period ended March 31, 2010. |
|-----|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|                                                                                      | SLUSas Parent |             |  SLNY |   | OtherSubs       |   |  Elimination |          | ConsolidatedCompany |
|-------------------------------------------------------------------------------------------|---------------|------------------|------------|--------|-----------------|--------|-------------------|---------------|---------------------|
| ASSETS                                                                                    |          |             |       |   |            |   |              |          |                |   |   |   |   |   |
|                                                                                      |          |             |       |   |            |   |              |          |                |   |   |   |   |   |
| Investments                                                                               |          |             |       |   |            |   |              |          |                |   |   |   |   |   |
| Available-for-sale fixed maturity securities at fair value                                | $             | 1,273,157   |       | $      | 243,560    |   | $                 | 62,538   |                | $ | -  |   | $ | 1,579,255  |
| Trading fixed maturity securities at fair value                                           |          | 9,869,645   |       |   | 1,540,225  |   |              | -        |                |   | -  |   |   | 11,409,870  |
| Investment in subsidiaries                                                                |          | 573,262     |       |   | -          |   |              | -        |                |   | (573,262) |   |   | -  |
| Mortgage loans                                                                            |          | 1,470,205   |       |   | 173,753    |   |              | 41,102   |                |   | -  |   |   | 1,685,060  |
| Derivative instruments – receivable                                                 |          | 205,910     |       |   | -          |   |              | -        |                |   | -  |   |   | 205,910  |
| Limited partnerships                                                                      |          | 39,000      |       |   | -          |   |              | -        |                |   | -  |   |   | 39,000  |
| Real estate                                                                               |          | 171,646     |       |   | -          |   |              | 44,803   |                |   | -  |   |   | 216,449  |
| Policy loans                                                                              |          | 692,702     |       |   | 828        |   |              | 20,792   |                |   | -  |   |   | 714,322  |
| Other invested assets                                                                     |          | 37,130      |       |   | 9,406      |   |              | -        |                |   | -  |   |   | 46,536  |
| Short-term investments                                                                    |          | 242,960     |       |   | 18,998     |   |              | -        |                |   | -  |   |   | 261,958  |
| Cash and cash equivalents                                                                 |          | 967,624     |       |   | 76,514     |   |              | 9,890    |                |   | -  |   |   | 1,054,028  |
| Total investments and cash                                                                |          | 15,543,241  |       |   | 2,063,284  |   |              | 179,125  |                |   | (573,262) |   |   | 17,212,388  |
|                                                                                      |          |             |       |   |            |   |              |          |                |   |   |   |   |   |
| Accrued investment income                                                                 |          | 179,572     |       |   | 21,670     |   |              | 1,515    |                |   | -  |   |   | 202,757  |
| Deferred policy acquisition costs and sales inducement     asset |          | 1,400,786   |       |   | 105,674    |   |              | -        |                |   | -  |   |   | 1,506,460  |
| Value of business and customer renewals acquired                                          |          | 104,364     |       |   | 4,158      |   |              | -        |                |   | -  |   |   | 108,522  |
| Net deferred tax asset                                                                    |          | 358,392     |       |   | 14,281     |   |              | 4,020    |                |   | -  |   |   | 376,693  |
| Goodwill                                                                                  |          | -           |       |   | 7,299      |   |              | -        |                |   | -  |   |   | 7,299  |
| Receivable for investments sold                                                           |          | 33,236      |       |   | 945        |   |              | 250      |                |   | -  |   |   | 34,431  |
| Reinsurance receivable                                                                    |          | 2,173,365   |       |   | 159,167    |   |              | 81       |                |   | -  |   |   | 2,332,613  |
| Other assets                                                                              |          | 143,396     |       |   | 27,817     |   |              | 2,221    |                |   | (2,345) |   |   | 171,089  |
| Separate account assets                                                                   |          | 26,504,194  |       |   | 1,340,341  |   |              | 42,787   |                |   | -  |   |   | 27,887,322  |
|                                                                                      |          |             |       |   |            |   |              |          |                |   |   |   |   |   |
| Total assets                                                                              | $             | 46,440,546  |       | $      | 3,744,636  |   | $                 | 229,999  |                | $ | (575,607) |   | $ | 49,839,574  |
|                                                                                      |          |             |       |   |            |   |              |          |                |   |   |   |   |   |
| LIABILITIES                                                                               |          |             |       |   |            |   |              |          |                |   |   |   |   |   |
|                                                                                      |          |             |       |   |            |   |              |          |                |   |   |   |   |   |
| Contractholder deposit funds and other policy liabilities                                 | $             | 12,578,391  |       | $      | 1,540,644  |   | $                 | 24,329   |                | $ | -  |   | $ | 14,143,364  |
| Future contract and policy benefits                                                       |          | 712,796     |       |   | 116,871    |   |              | 200      |                |   | -  |   |   | 829,867  |
| Payable for investments purchased                                                         |          | 153,405     |       |   | 603        |   |              | -        |                |   | -  |   |   | 154,008  |
| Accrued expenses and taxes                                                                |          | 39,858      |       |   | 6,081      |   |              | 1,492    |                |   | (2,345) |   |   | 45,086  |
| Debt payable to affiliates                                                                |          | 783,000     |       |   | -          |   |              | -        |                |   | -  |   |   | 783,000  |
| Reinsurance payable                                                                       |          | 1,974,407   |       |   | 242,283    |   |              | 35       |                |   | -  |   |   | 2,216,725  |
| Derivative instruments – payable                                                    |          | 311,765     |       |   | -          |   |              | -        |                |   | -  |   |   | 311,765  |
| Other liabilities                                                                         |          | 217,597     |       |   | 60,644     |   |              | 25,063   |                |   | -  |   |   | 303,304  |
| Separate account liabilities                                                              |          | 26,504,194  |       |   | 1,340,341  |   |              | 42,787   |                |   | -  |   |   | 27,887,322  |
|                                                                                      |          |             |       |   |            |   |              |          |                |   |   |   |   |   |
| Total liabilities                                                                         | $             | 43,275,413  |       | $      | 3,307,467  |   | $                 | 93,906   |                | $ | (2,345) |   | $       ,488 | 46,674,441  |
|                                                                                      |          |             |       |   |            |   |              |          |                |   |   |   |   |   |
| STOCKHOLDER’S EQUITY                                                                |          |             |       |   |            |   |              |          |                |   |   |   |   |   |
|                                                                                      |          |             |       |   |            |   |              |          |                |   |   |   |   |   |
| Common stock                                                                              | $             | 6,437       |       | $      | 2,100      |   | $                 | 2,542    |                | $ | (4,642) |   | $ | 6,437  |
| Additional paid-in capital                                                                |          | 3,929,012   |       |   | 389,963    |   |              | 113,265  |                |   | (503,228) |   |   | 3,929,012  |
| Accumulated other comprehensive income                                                    |          | 37,931      |       |   | 112        |   |              | 1,855    |                |   | (1,967) |   |   | 37,931  |
| (Accumulated deficit) retained earnings                                                   |          | (808,247)        |       |   | 44,994     |   |              | 18,431   |                |   | (63,425) |   |   | (808,247) |
|                                                                                      |          |             |       |   |            |   |              |          |                |   |   |   |   |   |
| Total stockholder’s equity                                                          |          | 3,165,133   |       |   | 437,169    |   |              | 136,093  |                |   | (573,262) |   |   | 3,165,133  |
|                                                                                      |          |             |       |   |            |   |              |          |                |   |   |   |   |   |
| Total liabilities and stockholder’s equity                                          | $             | 46,440,546  |       | $      | 3,744,767  |   | $                 | 229,999  |                | $ | (575,607) |   | $ | 49,839,574  |

----

Table of Contents

|                                                                                      | SLUSas Parent |                |  SLNY |   | OtherSubs             |   |  Elimination |              | ConsolidatedCompany |
|-------------------------------------------------------------------------------------------|---------------|---------------------|------------|--------|-----------------------|--------|-------------------|-------------------|---------------------|
| ASSETS                                                                                    |          |                |       |   |                  |   |              |              |                |   |   |   |   |   |
|                                                                                      |          |                |       |   |                  |   |              |              |                |   |   |   |   |   |
| Investments                                                                               |          |                |       |   |                  |   |              |              |                |   |   |   |   |   |
| Available-for-sale fixed maturity securities at fair value                                | $             | 1,193,875      |       | $      | 246,944          |   | $                 | 55,104       |                | $ | -  |   | $ | 1,495,923  |
| Trading fixed maturity securities at fair value                                           |          | 9,911,284      |       |   | 1,555,834        |   |              | -            |                |   | -  |   |   | 11,467,118  |
| Mortgage loans                                                                            |          | 1,531,545      |       |   | 176,518          |   |              | 29,465       |                |   | -  |   |   | 1,737,528  |
| Derivative instruments – receivable                                                 |          |  198,064  |       |   |  -          |   |              | -            |                |   | -  |   |   | 198,064  |
| Limited partnerships                                                                      |          |  41,622   |       |   |  -          |   |              | -            |                |   | -  |   |   | 41,622  |
| Real estate                                                                               |          |  161,800  |       |   |  -          |   |              | 52,865       |                |   | -  |   |   | 214,665  |
| Policy loans                                                                              |          |  695,607  |       |   | 1,217            |   |              | 20,584       |                |   | -  |   |   | 717,408  |
| Other invested assets                                                                     |          |  19,588   |       |   | 7,868            |   |              | -            |                |   | -  |   |   | 27,456  |
| Short-term investments                                                                    |          |  813,745  |       |   | 18,994           |   |              | -            |                |   | -  |   |   | 832,739  |
| Cash and cash equivalents                                                                 |          | 647,579        |       |   | 72,978           |   |              | 15,766            |                |   | -  |   |   | 736,323  |
| Investment in subsidiaries                                                                |          | 559,344        |       |   | -                |   |              | -            |                |   | (559,344) |   |   | -  |
| Total investments and cash                                                                |          | 15,774,053     |       |   | 2,080,353        |   |              | 173,784      |                |   | (559,344) |   |   | 17,468,846  |
|                                                                                      |          |                |       |   |                  |   |              |              |                |   |   |   |   |   |
| Accrued investment income                                                                 |          | 165,841        |       |   | 21,130           |   |              |  1,815  |                |   | -  |   |   | 188,786  |
| Deferred policy acquisition costs and sales inducement     asset |          | 1,571,768      |       |   | 110,791          |   |              | -            |                |   | -  |   |   |  1,682,559  |
| Value of business and customer renewals acquired                                          |          | 130,546        |       |   | 4,439            |   |              | -            |                |   | -  |   |   | 134,985  |
| Net deferred tax asset                                                                    |          | 378,078        |       |   | 12,057           |   |              |  4,162  |                |   | -  |   |   | 394,297  |
| Goodwill                                                                                  |          | -              |       |   | 7,299            |   |              | -            |                |   | -  |   |   |  7,299  |
| Receivable for investments sold                                                           |          | 5,166          |       |   | 162              |   |              | -            |                |   | -  |   |   |  5,328  |
| Reinsurance receivable                                                                    |          | 2,184,487      |       |   | 162,522          |   |              | 77           |                |   | -  |   |   |  2,347,086  |
| Other assets                                                                              |          | 93,755         |       |   | 31,729           |   |              |  2,918  |                |   | (2,873) |   |   | 125,529  |
| Separate account assets                                                                   |          | 25,573,382     |       |   |  1,265,464  |   |              | 41,575       |                |   | -  |   |   |  26,880,421  |
|                                                                                      |          |                |       |   |                  |   |              |              |                |   |   |   |   |   |
| Total assets                                                                              | $             | 45,877,076     |       | $      | 3,695,946        |   | $                 | 224,331      |                | $ | (562,217) |   | $ | 49,235,136  |
|                                                                                      |          |                |       |   |                  |   |              |              |                |   |   |   |   |   |
| LIABILITIES                                                                               |          |                |       |   |                  |   |              |              |                |   |   |   |   |   |
|                                                                                      |          |                |       |   |                  |   |              |              |                |   |   |   |   |   |
| Contractholder deposit funds and other policy liabilities                                 | $             | 12,991,306     |       | $      | 1,577,556        |   | $                 | 24,366       |                | $ | -  |   | $ |  14,593,228  |
| Future contract and policy benefits                                                       |          |  732,368  |       |   | 116,946          |   |              | 200          |                |   | -  |   |   | 849,514  |
| Payable for investments purchased                                                         |          |  44,723   |       |   | 104              |   |              | -            |                |   | -  |   |   | 44,827  |
| Accrued expenses and taxes                                                                |          |  49,224   |       |   | 4,612            |   |              |  1,665  |                |   | (2,873) |   |   | 52,628  |
| Debt payable to affiliates                                                                |          |  783,000  |       |   |  -          |   |              | -            |                |   | -  |   |   | 783,000  |
| Reinsurance payable                                                                       |          | 1,995,083      |       |   | 236,718          |   |              | 34           |                |   | -  |   |   |  2,231,835  |
| Derivative instruments – payable                                                    |          |  362,023  |       |   |  -          |   |              | -            |                |   | -  |   |   | 362,023  |
| Other liabilities                                                                         |          |  193,363  |       |   | 66,118           |   |              | 25,575       |                |   | -  |   |   | 285,056  |
| Separate account liabilities                                                              |          | 25,573,382     |       |   |  1,265,464  |   |              | 41,575       |                |   | -  |   |   |  26,880,421  |
|                                                                                      |          |                |       |   |                  |   |              |              |                |   |   |   |   |   |
| Total liabilities                                                                         |          | 42,724,472     |       |   | 3,267,518        |   |              | 93,415       |                |   | (2,873) |   |   | 46,082,532  |
|                                                                                      |          |                |       |   |                  |   |              |              |                |   |   |   |   |   |
| STOCKHOLDER’S EQUITY                                                                |          |                |       |   |                  |   |              |              |                |   |   |   |   |   |
|                                                                                      |          |                |       |   |                  |   |              |              |                |   |   |   |   |   |
| Common stock                                                                              | $             | 6,437          |       | $      | 2,100            |   | $                 |  2,542  |                | $ | (4,642) |   | $ |  6,437  |
| Additional paid-in capital                                                                |          | 3,928,246      |       |   | 389,963          |   |              | 108,450      |                |   | (498,413) |   |   |  3,928,246  |
| Accumulated other comprehensive income                                                    |          |  46,553   |       |   | 1,977            |   |              |  1,707  |                |   | (3,684) |   |   | 46,553  |
| (Accumulated deficit) retained earnings                                                   |          | (828,632)           |       |   | 34,388           |   |              | 18,217       |                |   | (52,605) |   |   |  (828,632) |
|                                                                                      |          |                |       |   |                  |   |              |              |                |   |   |   |   |   |
| Total stockholder’s equity                                                          |          | 3,152,604      |       |   | 428,428          |   |              | 130,916      |                |   | (559,344) |   |   | 3,152,604  |
|                                                                                      |          |                |       |   |                  |   |              |              |                |   |   |   |   |   |
| Total liabilities and stockholder’s equity                                          | $             | 45,877,076     |       | $      | 3,695,946        |   | $                 | 224,331      |                | $ | (562,217) |   | $ | 49,235,136  |

----

Table of Contents

|                                                                                                                      | SLUSas Parent |          |  SLNY |   | OtherSubs     |   |  Elimination |        | ConsolidatedCompany |
|---------------------------------------------------------------------------------------------------------------------------|---------------|---------------|------------|--------|---------------|--------|-------------------|-------------|---------------------|
|                                                                                                                      |          |          |       |   |          |   |              |        |                |   |   |   |   |   |
| Cash Flows From Operating Activities:                                                                                     |          |          |       |   |          |   |              |        |                |   |   |   |   |   |
| Net income                                                                                                                | $             | 20,385   |       | $      | 10,606   |   | $                 | 214    |                | $ | (10,820) |   | $ | 20,385  |
| Adjustments to reconcile net income  to net cash     provided by operating activities: |          |          |       |   |          |   |              |        |                |   |   |   |   |   |
| Net amortization of premiums on investments                                                                               |          | 8,434    |       |   | 1,583    |   |              | 271    |                |   | -  |   |   | 10,288  |
| Amortization of DAC, VOBA and VOCRA                                                                                       |          | 238,702  |       |   | 9,412    |   |              | -      |                |   | -  |   |   | 248,114  |
| Depreciation and amortization                                                                                             |          | 4,499    |       |   | 79       |   |              | 338    |                |   | -  |   |   | 4,916  |
| Net gains on derivatives                                                                                                  |          | (25,591)      |       |   | (15,179)      |   |              | -      |                |   | -  |   |   | (40,770) |
| Net realized (gains) losses and OTTI credit losses on      available-for-sale investments   |          | (4,379)       |       |   | 453      |   |              | (86)        |                |   | -  |   |   | (4,012) |
| Net (increase) decrease in fair value of trading      investments                           |          | (122,250)     |       |   | 929      |   |              | -      |                |   | -  |   |   | (121,321) |
| Net realized losses (gains) on trading investments                                                                        |          | 1,293    |       |   | (3,514)       |   |              | -      |                |   | -  |   |   | (2,221) |
| Undistributed loss in private equity limited      partnerships                              |          | 694      |       |   | -        |   |              | -      |                |   | -  |   |   | 694  |
| Interest credited to contractholder deposits                                                                              |          | 74,452   |       |   | 13,190   |   |              | 234    |                |   | -  |   |   | 87,876  |
| Equity in net income of subsidiaries                                                                                      |          | (10,820)      |       |   | -        |   |              | -      |                |   | 10,820  |   |   | -  |
| Deferred federal income taxes                                                                                             |          | 23,404   |       |   | (1,219)       |   |              | 62     |                |   | -  |   |   | 22,247  |
| Changes in assets and liabilities:                                                                                        |          |          |       |   |          |   |              |        |                |   |   |   |   |   |
| Additions to DAC, SIA, VOBA and VOCRA                                                                                     |          | (38,841)      |       |   | (4,014)       |   |              | -      |                |   | -  |   |   | (42,855) |
| Accrued investment income                                                                                                 |          | (13,731)      |       |   | (540)         |   |              | 300    |                |   | -  |   |   | (13,971) |
| Net change in reinsurance receivable/payable                                                                              |          | 22,190   |       |   | 10,162   |   |              | (3)         |                |   | -  |   |   | 32,349  |
| Future contract and policy benefits                                                                                       |          | (19,572)      |       |   | (75)          |   |              | -      |                |   | -  |   |   | (19,647) |
| Other, net                                                                                                                |          | 40,647   |       |   | 7,638    |   |              | (75)        |                |   | -  |   |   | 48,210  |
|                                                                                                                      |          |          |       |   |          |   |              |        |                |   |   |   |   |   |
| Net cash provided by operating activities                                                                                 |          | 199,516  |       |   | 29,511   |   |              | 1,255  |                |   | -  |   |   | 230,282  |
|                                                                                                                      |          |          |       |   |          |   |              |        |                |   |   |   |   |   |
| Cash Flows From Investing Activities:                                                                                     |          |          |       |   |          |   |              |        |                |   |   |   |   |   |
| Sales, maturities and repayments of:                                                                                      |          |          |       |   |          |   |              |        |                |   |   |   |   |   |
| Available-for-sale fixed maturity securities                                                                              |          | 36,639   |       |   | 23,900   |   |              | 557    |                |   | -  |   |   | 61,096  |
| Trading fixed maturity securities                                                                                         |          | 654,286  |       |   | 106,779  |   |              | -      |                |   | -  |   |   | 761,065  |
| Mortgage loans                                                                                                            |          | 58,328   |       |   | 2,744    |   |              | 1,608  |                |   | (12,624) |   |   | 50,056  |
| Real estate                                                                                                               |          | -        |       |   | -        |   |              | 8,641  |                |   | (8,641) |   |   | -  |
| Other invested assets                                                                                                     |          | (121,031)     |       |   | -        |   |              | -      |                |   | -  |   |   | (121,031) |
| Purchases of:                                                                                                             |          |          |       |   |          |   |              |        |                |   |   |   |   |   |
| Available-for-sale fixed maturity securities                                                                              |          | (119,932)     |       |   | (23,519)      |   |              | (7,941)     |                |   | -  |   |   | (151,392) |
| Trading fixed maturity securities                                                                                         |          | (504,551)     |       |   | (90,737)      |   |              | -      |                |   | -  |   |   | (595,288) |
| Mortgage loans                                                                                                            |          | (13)          |       |   | (550)         |   |              | (13,556)    |                |   | 12,624  |   |   | (1,495) |
| Real estate                                                                                                               |          | (14,239)      |       |   | -        |   |              | (863)       |                |   | 8,641  |   |   | (6,461) |
| Other invested assets                                                                                                     |          | (32,224)      |       |   | -        |   |              | -      |                |   | -  |   |   | (32,224) |
| Net change in policy loans                                                                                                |          | 2,905    |       |   | 389      |   |              | (208)       |                |   | -  |   |   | 3,086  |
| Net change in short-term investments                                                                                      |          | 570,785  |       |   | (4)           |   |              | -      |                |   | -  |   |   | 570,781  |
|                                                                                                                      |          |          |       |   |          |   |              |        |                |   |   |   |   |   |
| Net cash provided by (used in) investing activities                                                                       | $             | 530,953  |       | $      | 19,002   |   | $                 | (11,762)    |                | $ | -  |   | $ | 538,193  |

----

Table of Contents

|                                                | SLUSas Parent |          |  SLNY |   | OtherSubs    |   |  Elimination |         | ConsolidatedCompany |
|-----------------------------------------------------|---------------|---------------|------------|--------|--------------|--------|-------------------|--------------|---------------------|
|                                                |          |          |       |   |         |   |              |         |                |   |   |   |   |   |
| Cash Flows From Financing Activities:               |          |          |       |   |         |   |              |         |                |   |   |   |   |   |
| Additions to contractholder deposit funds           | $             | 222,319  |       | $      | 29,548  |   | $                 | -       |                | $ | -  |   | $ | 251,867  |
| Withdrawals from contractholder deposit funds       |          | (622,460)     |       |   | (65,710)     |   |              | (270)        |                |   | -  |   |   | (688,440) |
| Additional capital contributed to subsidiaries      |          | (4,815)       |       |   | -       |   |              | -       |                |   | 4,815  |   |   | -  |
| Capital contribution from Parent                    |          | -        |       |   | -       |   |              | 4,815   |                |   | (4,815) |   |   | -  |
| Other, net                                          |          | (5,468)       |       |   | (8,815)      |   |              | 86      |                |   | -  |   |   | (14,197) |
|                                                |          |          |       |   |         |   |              |         |                |   |   |   |   |   |
| Net cash (used in) provided by financing activities |          | (410,424)     |       |   | (44,977)     |   |              | 4,631   |                |   | -  |   |   | (450,770) |
|                                                |          |          |       |   |         |   |              |         |                |   |   |   |   |   |
| Net change in cash and cash equivalents             |          | 320,045  |       |   | 3,536   |   |              | (5,876)      |                |   | -  |   |   | 317,705  |
|                                                |          |          |       |   |         |   |              |         |                |   |   |   |   |   |
| Cash and cash equivalents, beginning of period      |          | 647,579  |       |   | 72,978  |   |              | 15,766  |                |   | -  |   |   | 736,323  |
|                                                |          |          |       |   |         |   |              |         |                |   |   |   |   |   |
| Cash and cash equivalents, end of period            | $             | 967,624  |       | $      | 76,514  |   | $                 | 9,890   |                | $ | -  |   | $ | 1,054,028  |

----

Table of Contents

|                                                                                                            | SLUSas Parent |              |  SLNY |   | OtherSubs     |   |  Elimination |          | ConsolidatedCompany |
|-----------------------------------------------------------------------------------------------------------------|---------------|-------------------|------------|--------|---------------|--------|-------------------|---------------|---------------------|
|                                                                                                            |          |              |       |   |          |   |              |          |                |   |   |   |   |   |
| Cash Flows From Operating Activities:                                                                           |          |              |       |   |          |   |              |          |                |   |   |   |   |   |
| Net income (loss)                                                                                               | $             | 111,651      |       | $      | (1,065)       |   | $                 | 958      |                | $ | 107  |   | $ | 111,651  |
| Adjustments to reconcile net income (loss) to net    cash provided by operating activities: |          |              |       |   |          |   |              |          |                |   |   |   |   |   |
| Net amortization of premiums on investments                                                                     |          | 1,873        |       |   | 552      |   |              | 162      |                |   | -  |   |   | 2,587  |
| Amortization of DAC, VOBA and VOCRA                                                                             |          | 135,321      |       |   | 36,388   |   |              | -        |                |   | -  |   |   | 171,709  |
| Depreciation and amortization                                                                                   |          | 925          |       |   | 78       |   |              | 211      |                |   | -  |   |   | 1,214  |
| Net losses (gains) on derivatives                                                                               |          | 12,620       |       |   | (6,499)       |   |              | -        |                |   | -  |   |   | 6,121  |
| Net realized gains and OTTI credit losses on    available-for-sale investments              |          |  (3,635)     |       |   |  (246)   |   |              |  (399)   |                |   |  -  |   |   |  (4,280) |
| Net increase in fair value of trading investments                                                               |          | (253,291)         |       |   | (17,144)      |   |              | -        |                |   | -  |   |   | (270,435) |
| Net realized losses (gains) on trading investments                                                              |          | 37,752       |       |   | (3,825)       |   |              | -        |                |   | -  |   |   | 33,927  |
| Undistributed loss in private equity limited    partnerships                                |          |  1,631  |       |   |  -  |   |              |  -  |                |   |  -  |   |   |  1,631  |
| Interest credited to contractholder deposits                                                                    |          | 76,656       |       |   | 12,533   |   |              | 194      |                |   | -  |   |   | 89,383  |
| Equity in net loss of subsidiaries                                                                              |          | 107          |       |   | -        |   |              | -        |                |   | (107) |   |   | -  |
| Deferred federal income taxes                                                                                   |          | 55,083       |       |   | (729)         |   |              | 177      |                |   | -  |   |   | 54,531  |
| Changes in assets and liabilities:                                                                              |          |              |       |   |          |   |              |          |                |   |   |   |   |   |
| Additions to DAC, VOBA and VOCRA                                                                                |          | (49,149)          |       |   | (6,990)       |   |              | -        |                |   | -  |   |   | (56,139) |
| Accrued investment income                                                                                       |          | 14,079       |       |   | (1,685)       |   |              | 151      |                |   | -  |   |   | 12,545  |
| Net change in reinsurance receivable/payable                                                                    |          | 27,338       |       |   | 1,473    |   |              | 57       |                |   | -  |   |   | 28,868  |
| Future contract and policy benefits                                                                             |          | (20,301)          |       |   | (238)         |   |              | -        |                |   | -  |   |   | (20,539) |
| Other, net                                                                                                      |          | 55,946       |       |   | 25,560   |   |              | (278)         |                |   | -  |   |   | 81,228  |
|                                                                                                            |          |              |       |   |          |   |              |          |                |   |   |   |   |   |
| Net cash provided by operating activities                                                                       |          | 204,606      |       |   | 38,163   |   |              | 1,233    |                |   | -  |   |   | 244,002  |
|                                                                                                            |          |              |       |   |          |   |              |          |                |   |   |   |   |   |
| Cash Flows From Investing Activities:                                                                           |          |              |       |   |          |   |              |          |                |   |   |   |   |   |
| Sales, maturities and repayments of:                                                                            |          |              |       |   |          |   |              |          |                |   |   |   |   |   |
| Available-for-sale fixed maturity securities                                                                    |          | 59,278       |       |   | 8,902    |   |              | 2,312    |                |   | -  |   |   | 70,492  |
| Trading fixed maturity securities                                                                               |          | 561,184      |       |   | 176,441  |   |              | -        |                |   | -  |   |   | 737,625  |
| Mortgage loans                                                                                                  |          | 37,645       |       |   | 2,444    |   |              | 71       |                |   | (15,064) |   |   | 25,096  |
| Real estate                                                                                                     |          | -            |       |   | 1,000    |   |              | -        |                |   | (1,000) |   |   | -  |
| Other invested assets                                                                                           |          | (65,565)          |       |   | 502      |   |              | 502      |                |   | -  |   |   | (64,561) |
| Purchases of:                                                                                                   |          |              |       |   |          |   |              |          |                |   |   |   |   |   |
| Available-for-sale fixed maturity securities                                                                    |          | (3,501)           |       |   | (42,645)      |   |              | (253)         |                |   | -  |   |   | (46,399) |
| Trading fixed maturity securities                                                                               |          | (1,114,393)       |       |   | (218,072)     |   |              | -        |                |   | -  |   |   | (1,332,465) |
| Mortgage loans                                                                                                  |          | 3,409        |       |   | (18,840)      |   |              | (15,064)      |                |   | 15,064  |   |   | (15,431) |
| Real estate                                                                                                     |          | (1,685)           |       |   | -        |   |              | (219)         |                |   | 1,000  |   |   | (904) |
| Other invested assets                                                                                           |          | (16,616)          |       |   | -        |   |              | -        |                |   | -  |   |   | (16,616) |
| Net change in policy loans                                                                                      |          | 12,727       |       |   | (655)         |   |              | 226      |                |   | -  |   |   | 12,298  |
| Net change in short-term investments                                                                            |          | (751,435)         |       |   | (31,001)      |   |              | (2,000)       |                |   | -  |   |   | (784,436) |
|                                                                                                            |          |              |       |   |          |   |              |          |                |   |   |   |   |   |
| Net cash used in investing activities                                                                           | $             | (1,278,952)       |       | $      | (121,924)     |   | $                 | (14,425)      |                | $ | -  |   | $ | (1,415,301) |

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|                                                | SLUSas Parent |            |  SLNY |   | OtherSubs     |   |  Elimination |         | ConsolidatedCompany |
|-----------------------------------------------------|---------------|-----------------|------------|--------|---------------|--------|-------------------|--------------|---------------------|
|                                                |          |            |       |   |          |   |              |         |                |   |   |   |   |   |
| Cash Flows From Financing Activities:               |          |            |       |   |          |   |              |         |                |   |   |   |   |   |
| Additions to contractholder deposit funds           | $             | 284,686    |       | $      | 43,929   |   | $                 | -       |                | $ | -  |   | $ | 328,615  |
| Withdrawals from contractholder deposit funds       |          | (552,936)       |       |   | (56,094)      |   |              | (1,780)      |                |   | -  |   |   | (610,810) |
| Additional capital contributed to subsidiaries      |          | (15,097)        |       |   | -        |   |              | -       |                |   | 15,097  |   |   | -  |
| Capital contribution from Parent                    |          | 400,000    |       |   | -        |   |              | 15,097  |                |   | (15,097) |   |   | 400,000  |
| Other, net                                          |          | (14,085)        |       |   | (3,552)       |   |              | 20      |                |   | -  |   |   | (17,617) |
|                                                |          |            |       |   |          |   |              |         |                |   |   |   |   |   |
| Net cash provided by (used in) financing activities |          | 102,568    |       |   | (15,717)      |   |              | 13,337  |                |   | -  |   |   | 100,188  |
|                                                |          |            |       |   |          |   |              |         |                |   |   |   |   |   |
| Net change in cash and cash equivalents             |          | (971,778)       |       |   | (99,478)      |   |              | 145     |                |   | -  |   |   | (1,071,111) |
|                                                |          |            |       |   |          |   |              |         |                |   |   |   |   |   |
| Cash and cash equivalents, beginning of period      |          | 1,616,991  |       |   | 175,322  |   |              | 11,895  |                |   | -  |   |   | 1,804,208  |
|                                                |          |            |       |   |          |   |              |         |                |   |   |   |   |   |
| Cash and cash equivalents, end of period            | $             | 645,213    |       | $      | 75,844   |   | $                 | 12,040  |                | $ | -  |   | $ | 733,097  |

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Item 2. Management’s Discussion and Analysis of Financial Position and Results of Operations.

|   | · | Deferred policy acquisition costs (“DAC”), including sales inducement asset (“SIA”); |
|--------|--------|--------------------------------------------------------------------------------------------------------------|

|   | · | Value of business acquired (“VOBA”); |
|--------|--------|--------------------------------------------------|

|   | · | Value of customer renewals acquired (“VOCRA”); |
|--------|--------|------------------------------------------------------------|

|   | · | Derivative instruments; |
|--------|--------|-------------------------|

|   | · | Fair value of financial instruments; |
|--------|--------|--------------------------------------|

|   | · | Policy liabilities and accruals; |
|--------|--------|----------------------------------|

|   | · | Other-than-temporary impairments (“OTTI”) of investments; |
|--------|--------|-----------------------------------------------------------------------|

|   | · | Goodwill valuation; |
|--------|--------|---------------------|

|   | · | Allowance for loan loss; |
|--------|--------|--------------------------|

|   | · | Valuation allowance on deferred tax assets; and |
|--------|--------|-------------------------------------------------|

|   | · | Provisions for income taxes. |
|--------|--------|------------------------------|

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|                         |   | 2011                                                                      |   | 2010                                          |
|------------------------------|--------|---------------------------------------------------------------------------|--------|-----------------------------------------------|
|                         |   |                                                                      |   |                                          |
| Interest rate contracts      |   | $          (8,922)      |   | $      (42,444) |
| Foreign currency contracts   |   | (2,623)                                                                   |   | (3,459)                                       |
| Equity contracts             |   | 10,504                                                               |   | (5,229)                                       |
| Credit contracts             |   | 3,495                                                                |   | (263)                                         |
| Futures contracts            |   | (120,880)                                                                 |   | (71,775)                                      |
| Embedded derivatives         |   | 146,196                                                              |   | 81,720                                   |
| Net derivative income (loss) |   | $          27,770  |   | $      (41,450) |

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|                             | 2011   |    | 2010   |
|----------------------------------|--------|---------|--------|
|                             |   |    |   |   |   |
| Total revenues                   | $      | 459,888 |   | $ | 542,125 |
| Total benefits and expenses      |   | 424,528 |   |   | 337,465 |
| Income before income tax expense |   | 35,360  |   |   | 204,660 |
|                             |   |    |   |   |   |
| Net income                       | $      | 27,963  |   | $ | 138,135 |

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|                                              | 2011   |         | 2010   |
|---------------------------------------------------|--------|--------------|--------|
|                                              |   |         |   |   |   |
| Total revenues                                    | $      | 19,506  |   | $ | 15,226  |
| Total benefits and expenses                       |   | 21,893  |   |   | 14,215  |
| (Loss) income before income tax (benefit) expense |   | (2,387)      |   |   | 1,011  |
|                                              |   |         |   |   |   |
| Net (loss) income                                 | $      | (1,489)      |   | $ | 711  |
|                                              |   |         |   |   |   |

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|                             | 2011   |         | 2010   |
|----------------------------------|--------|--------------|--------|
|                             |   |         |   |   |   |
| Total revenues                   | $      | 31,307  |   | $ | 32,261  |
| Total benefits and expenses      |   | 30,418  |   |   | 31,148  |
| Income before income tax expense |   | 889     |   |   | 1,113  |
|                             |   |         |   |   |   |
| Net income                       | $      | 583     |   | $ | 723  |
|                             |   |         |   |   |   |

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|                           | 2011   |        | 2010   |
|--------------------------------|--------|-------------|--------|
|                           |   |        |   |   |   |
| Total revenues                 | $      | (4,623)     |   | $ | (32,136) |
| Total benefits and expenses    |   | 4,695  |   |   | 10,874  |
| Loss before income tax benefit |   | (9,318)     |   |   | (43,010) |
|                           |   |        |   |   |   |
| Net loss                       | $      | (6,672)     |   | $ | (27,918) |
|                           |   |        |   |   |   |

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Item 3. Quantitative and Qualitative Disclosures About Market Risk.

Item 4. Controls and Procedures.

Item 1. Legal Proceedings

Item 1A. Risk Factors.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

Item 3. Defaults Upon Senior Securities.

Item 4. (Removed and Reserved).

Item 5. Other Information.

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Item 6. Exhibits.

| 31.1   | Certification pursuant to Rule 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 |
|--------|------------------------------------------------------------------------------------------------------------------------------|
|   |                                                                                                                         |
| 31.2   | Certification pursuant to Rule 13a-14(a) and 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 |
|   |                                                                                                                         |
| 32.1   | Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002       |
|   |                                                                                                                         |
| 32.2   | Certification Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002       |

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|   | Sun Life Assurance Company of Canada (U.S.)(Registrant) |
|--------|---------------------------------------------------------|

| May 13, 2011 | /s/ Westley V. Thompson                  |
|--------------|------------------------------------------|
| Date         | Westley V. Thompson, President, SLF U.S. |
|         | (Principal Executive Officer)            |

| May 13, 2011 | /s/ Ronald H. Friesen                                                |
|--------------|----------------------------------------------------------------------|
| Date         | Ronald H. Friesen, Senior Vice President and Chief Financial Officer |
|         | (Principal Financial Officer)                                        |

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