----

----

----

| For the quarterly period endedJune 30, 2010 | 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, 333-155726, 333-155791, 333-155792, 333-155793, 333-155797, 333-156303, 333-156304, 333-156308, 333-160605, 333-160606, and 333-160607 |
|---------------------------------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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

| PART I  - FINANCIAL INFORMATION |
|-------------------------------------------|
|                                      |   |   |
| Item 1.                                   | Financial Statements: |   |
|                                      |   |   |
|                                      | Condensed Consolidated Statements of Operations for the six-month periods ended June 30,2010 and 2009 (Unaudited) | 3 |
|                                      |   |   |
|                                      | Condensed Consolidated Statements of Operations for the three-month periods ended June 30,2010 and 2009 (Unaudited) | 4 |
|                                      |   |   |
|                                      | Condensed Consolidated Balance Sheets as of June 30, 2010 and December 31, 2009(Unaudited) | 5 |
|                                      |   |   |
|                                      | Condensed Consolidated Statements of Comprehensive Income for the six and three-monthperiods ended June 30, 2010 and 2009 (Unaudited) | 6 |
|                                      |   |   |
|                                      | Condensed Consolidated Statements of Changes in Stockholder’s Equity for the six-monthperiods ended June 30, 2010 and 2009 (Unaudited) | 7 |
|                                      |   |   |
|                                      | Condensed Consolidated Statements of Cash Flows for the six-month periods ended June 30,2010 and 2009 (Unaudited) | 8 |
|                                      |   |   |
|                                      | Notes to the Unaudited Condensed Consolidated Financial Statements | 10 |
|                                      |   |   |
| Item 2.                                   | Management's Discussion and Analysis of Financial Position and Results of Operations | 73 |
|                                      |   |   |
| Item 3.                                   | Quantitative and Qualitative Disclosures About Market Risk | 85 |
|                                      |   |   |
| Item 4.                                   | Controls and Procedures | 85 |
|                                      |   |   |
|                                      |   |   |

| PART II – OTHER INFORMATION |
|-----------------------------------|
|                              |   |   |
| Item 1 .                          | Legal Proceedings | 85 |
|                              |   |   |
| Item 1A.                          | Risk Factors | 85 |
|                              |   |   |
| Item 2 .                          | Unregistered Sales of Equity Securities and Use of Proceeds | 85 |
|                              |   |   |
| Item 3.                           | Defaults Upon Senior Securities | 85 |
|                              |   |   |
| Item 4 .                          | (Removed and Reserved) | 85 |
|                              |   |   |
| Item 5 .                          | Other Information | 85 |
|                              |   |   |
| Item 6 .                          | Exhibits | 86 |

----

|                                                                                                                    | Unaudited  |
|-------------------------------------------------------------------------------------------------------------------------|-----------------|
|                                                                                                                    |  2010      |   |  2009 |
|                                                                                                                    |            |   |   |   |   |
| Revenues                                                                                                                |            |   |   |   |   |
|                                                                                                                    |            |   |   |   |   |
| Premiums and annuity considerations                                                                                     | $               | 68,242  |   | $ | 65,495  |
| Net investment income (1)                                                                                               |            | 851,447  |   |   | 1,216,943  |
| Net derivative (loss) income (Note 5)                                                                                   |            | (567,165) |   |   | 163,652  |
| Net realized investment gains (losses), excluding impairment   losses on available-for-sale securities   |            | 16,339  |   |   | (2,837) |
| Other-than-temporary impairment losses (2)  (Note 5)                                                          |            | (885) |   |   | (4,834) |
| Fee and other income                                                                                                    |            | 236,228  |   |   | 166,668  |
|                                                                                                                    |            |   |   |   |   |
| Total revenues                                                                                                          |            | 604,206  |   |   | 1,605,087  |
|                                                                                                                    |            |   |   |   |   |
| Benefits and Expenses                                                                                                   |            |   |   |   |   |
|                                                                                                                    |            |   |   |   |   |
| Interest credited                                                                                                       |            | 176,811  |   |   | 225,158  |
| Interest expense                                                                                                        |            | 26,452  |   |   | 25,738  |
| Policyowner benefits                                                                                                    |            |  116,577  |   |   | 90,036  |
| Amortization of deferred policy acquisition costs   and value of business and customer renewals acquired |            |  (253,232) |   |   | 401,820  |
| Other operating expenses                                                                                                |            | 159,793  |   |   | 93,744  |
|                                                                                                                    |            |   |   |   |   |
| Total benefits and expenses                                                                                             |            | 226,401  |   |   | 836,496  |
|                                                                                                                    |            |   |   |   |   |
| Income from continuing operations before income tax expense                                                             |            | 377,805  |   |   | 768,591  |
|                                                                                                                    |            |   |   |   |   |
| Income tax expense                                                                                                      |            | 121,354  |   |   | 273,883  |
|                                                                                                                    |            |   |   |   |   |
| Net income from continuing operations                                                                                   |            | 256,451  |   |   | 494,708  |
|                                                                                                                    |            |   |   |   |   |
| Loss from discontinued operations, net of tax (Note 1)                                                             |            | -  |   |   | (3,784) |
|                                                                                                                    |            |   |   |   |   |
| Net income                                                                                                              | $               | 256,451  |   | $ | 490,924  |

|   | (1)Net investment income includes an increase in market value of trading fixed maturity securities of $449.9 million and $941.4 million for the six-month periods ended June 30, 2010 and 2009, respectively. |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (2)The other-than-temporary impairment (“OTTI”) losses for the six-month periods ended June 30, 2010 and 2009 represent solely credit losses.  The Company incurred no non-credit OTTI losses during the six-month periods ended June 30, 2010 and 2009,    and as such, no non-credit OTTI losses were recognized in other comprehensive income for the periods. |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                                                                                                    | Unaudited  |
|-------------------------------------------------------------------------------------------------------------------------|-----------------|
|                                                                                                                    |  2010      |   |  2009 |
|                                                                                                                    |            |   |   |   |   |
| Revenues                                                                                                                |            |   |   |   |   |
|                                                                                                                    |            |   |   |   |   |
| Premiums and annuity considerations                                                                                     | $               | 33,178  |   | $ | 32,955  |
| Net investment income (1)                                                                                               |            | 407,618  |   |   | 1,073,286  |
| Net derivative (loss) income (Note 5)                                                                                   |            | (525,715) |   |   | 33,806  |
| Net realized investment gains (losses), excluding impairment   losses on available-for-sale securities   |            | 11,174  |   |   | (940) |
| Other-than-temporary impairment losses (2)  (Note 5)                                                          |            | -  |   |   | (4,834) |
| Fee and other income                                                                                                    |            | 120,475  |   |   | 90,467  |
|                                                                                                                    |            |   |   |   |   |
| Total revenues                                                                                                          |            | 46,730  |   |   | 1,224,740  |
|                                                                                                                    |            |   |   |   |   |
| Benefits and Expenses                                                                                                   |            |   |   |   |   |
|                                                                                                                    |            |   |   |   |   |
| Interest credited                                                                                                       |            | 87,428  |   |   | 112,374  |
| Interest expense                                                                                                        |            | 9,355  |   |   | 13,658  |
| Policyowner benefits                                                                                                    |            | 81,974  |   |   | (11,951) |
| Amortization of deferred policy acquisition costs   and value of business and customer renewals acquired |            | (424,941) |   |   | 509,244  |
| Other operating expenses                                                                                                |            | 78,883  |   |   | 46,803  |
|                                                                                                                    |            |   |   |   |   |
| Total benefits and expenses                                                                                             |            | (167,301) |   |   | 670,128  |
|                                                                                                                    |            |   |   |   |   |
| Income from continuing operations before income tax expense                                                             |            | 214,031  |   |   | 554,612  |
|                                                                                                                    |            |   |   |   |   |
| Income tax expense                                                                                                      |            | 69,231  |   |   | 201,180  |
|                                                                                                                    |            |   |   |   |   |
| Net income from continuing operations                                                                                   |            | 144,800  |   |   | 353,432  |
|                                                                                                                    |            |   |   |   |   |
| Income from discontinued operations, net of tax (Note 1)                                                           |            | -  |   |   | 87,878  |
|                                                                                                                    |            |   |   |   |   |
| Net income                                                                                                              | $               | 144,800  |   | $ | 441,310  |

|   | (1)Net investment income includes an increase in market value of trading fixed maturity securities of $179.5 million and $971.3 million for the three-month periods ended June 30, 2010 and 2009, respectively. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (2)The OTTI losses for the three-month periods ended June 30, 2010 and 2009 represent solely credit losses.  The Company incurred no non-credit OTTI losses during the three-month periods ended June 30, 2010 and 2009, and as such, no non-credit OTTI    losses were recognized in other comprehensive income for the periods. |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                                                                                                                                                    | Unaudited           |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------|---------------------|
| ASSETS                                                                                                                                                                  |  June 30, 2010 |   |  December 31, 2009 |
| Investments                                                                                                                                                             |                |   |   |   |   |
| Available-for-sale fixed maturity securities at fair value (amortized cost of $1,454,603    and $1,121,424 in 2010 and 2009, respectively) (Note 5) | $                   | 1,535,353  |   | $ | 1,175,516  |
| Trading fixed maturity securities at fair value (amortized cost of $12,528,553 and    $12,042,961in 2010 and 2009, respectively) (Note 5)           |                | 12,068,974  |   |   | 11,130,522  |
| Mortgage loans                                                                                                                                                          |                | 1,844,572  |   |   | 1,911,961  |
| Derivative instruments – receivable (Note 5)                                                                                                                      |                | 286,370  |   |   | 259,227  |
| Limited partnerships                                                                                                                                                    |                | 46,418  |   |   | 51,656  |
| Real estate                                                                                                                                                             |                | 204,392  |   |   | 202,277  |
| Policy loans                                                                                                                                                            |                | 713,834  |   |   | 722,590  |
| Other invested assets                                                                                                                                                   |                | 7,941  |   |   | 47,421  |
| Short-term investments (Note 1)                                                                                                                                         |                | 75,086  |   |   | 1,267,311  |
| Cash and cash equivalents                                                                                                                                               |                | 2,074,999  |   |   | 1,804,208  |
| Total investments and cash                                                                                                                                              |                | 18,857,939  |   |   | 18,572,689  |
|                                                                                                                                                                    |                |   |   |   |   |
| Accrued investment income                                                                                                                                               |                | 225,868  |   |   | 230,591  |
| Deferred policy acquisition costs                                                                                                                                       |                | 2,559,875  |   |   | 2,173,642  |
| Value of business and customer renewals acquired                                                                                                                        |                | 172,377  |   |   | 168,845  |
| Net deferred tax asset (Note 11)                                                                                                                                        |                | 396,729  |   |   | 549,764  |
| Goodwill (Note 10)                                                                                                                                                      |                | 7,299  |   |   | 7,299  |
| Receivable for investments sold                                                                                                                                         |                | 552,864  |   |   | 12,611  |
| Reinsurance receivable                                                                                                                                                  |                | 2,369,014  |   |   | 2,350,207  |
| Other assets                                                                                                                                                            |                | 129,400  |   |   | 183,963  |
| Separate account assets                                                                                                                                                 |                | 23,604,384  |   |   | 23,326,323  |
|                                                                                                                                                                    |                |   |   |   |   |
| Total assets                                                                                                                                                            | $                   | 48,875,749  |   | $ | 47,575,934  |
|                                                                                                                                                                    |                |   |   |   |   |
| LIABILITIES                                                                                                                                                             |                |   |   |   |   |
|                                                                                                                                                                    |                |   |   |   |   |
| Contractholder deposit funds and other policy liabilities                                                                                                               | $                   | 16,864,706  |   | $ | 16,709,589  |
| Future contract and policy benefits                                                                                                                                     |                | 827,345  |   |   | 815,638  |
| Payable for investments purchased                                                                                                                                       |                | 195,547  |   |   | 88,131  |
| Accrued expenses and taxes                                                                                                                                              |                | 105,457  |   |   | 61,903  |
| Debt payable to affiliates                                                                                                                                              |                | 883,000  |   |   | 883,000  |
| Reinsurance payable                                                                                                                                                     |                | 2,219,461  |   |   | 2,231,764  |
| Derivative instruments – payable (Note 5)                                                                                                                         |                | 602,790  |   |   | 572,910  |
| Other liabilities                                                                                                                                                       |                | 292,727  |   |   | 280,224  |
| Separate account liabilities                                                                                                                                            |                | 23,604,384  |   |   | 23,326,323  |
|                                                                                                                                                                    |                |   |   |   |   |
| Total liabilities                                                                                                                                                       |                | 45,595,417  |   |   | 44,969,482  |
|                                                                                                                                                                    |                |   |   |   |   |
| 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 2010 and 2009                       | $                   | 6,437  |   | $ | 6,437  |
| Additional paid-in capital                                                                                                                                              |                | 3,927,875  |   |   | 3,527,677  |
| Accumulated other comprehensive income                                                                                                                                  |                | 52,475  |   |   | 35,244  |
| Accumulated deficit                                                                                                                                                     |                | (706,455) |   |   | (962,906) |
|                                                                                                                                                                    |                |   |   |   |   |
| Total stockholder’s equity                                                                                                                                        |                | 3,280,332  |   |   | 2,606,452  |
|                                                                                                                                                                    |                |   |   |   |   |
| Total liabilities and stockholder’s equity                                                                                                                        | $                   | 48,875,749  |   | $ | 47,575,934  |

----

|                                                                                                                                               |   |  2010    |   |   |  2009    |
|----------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------|--------|--------|---------------|
|                                                                                                                                               |   |          |   |   |          |
| Net income                                                                                                                                         | $      | 256,451  |   | $      | 490,924  |
|                                                                                                                                               |   |          |   |   |          |
| Other comprehensive income:                                                                                                                        |   |          |   |   |          |
|                                                                                                                                               |   |          |   |   |          |
| Change in unrealized holding gains on available-for-sale fixed    maturity securities, net of tax and policyholder amounts (1) |   | 26,986   |   |   | 51,282   |
| Reclassification adjustment for OTTI losses, net of tax (2)                                                                                        |   | 363      |   |   | -        |
| Reclassification adjustments of net realized investment (gains)    losses into net income, net of tax (3)                 |   | (10,118)      |   |   | 1,961    |
|                                                                                                                                               |   |          |   |   |          |
| Other comprehensive income                                                                                                                         |   | 17,231   |   |   | 53,243   |
|                                                                                                                                               |   |          |   |   |          |
| Comprehensive income                                                                                                                               | $      | 273,682  |   | $      | 544,167  |

| (1)   | Net of tax expense of $(14.5) million and $(27.6) million for the six-month periods ended June 30, 2010 and 2009, 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 (expense) of $5.4 million and $(1.1) million for the six-month periods ended June 30, 2010 and 2009, respectively. |
|-----------------|---------------------------------------------------------------------------------------------------------------------------------------|

|                                                                                                                                               | Unaudited |
|----------------------------------------------------------------------------------------------------------------------------------------------------|-----------|
|                                                                                                                                               |      |  2010 |   |   |  2009 |
|                                                                                                                                               |      |   |   |   |   |
| Net income                                                                                                                                         | $         | 144,800  |   | $ | 441,310  |
|                                                                                                                                               |      |   |   |   |   |
| Other comprehensive income:                                                                                                                        |      |   |   |   |   |
|                                                                                                                                               |      |   |   |   |   |
| Change in unrealized holding gains on available-for-sale fixed    maturity securities, net of tax and policyholder amounts (4) |      | 18,818  |   |   | 79,883  |
| Reclassification adjustment for OTTI losses, net of tax (2)                                                                                        |      | 259  |   |   | -  |
| Reclassification adjustments of net realized investment (gains)    losses into net income, net of tax (5)                 |      | (7,735) |   |   | 2,718  |
|                                                                                                                                               |      |   |   |   |   |
| Other comprehensive income                                                                                                                         |      | 11,342 |   |   | 82,601  |
|                                                                                                                                               |      |   |   |   |   |
| Comprehensive income                                                                                                                               | $         | 156,142  |   | $ | 523,911  |

| (4)   | Net of tax expense of $(10.1) million and $(43.0) million for the three-month periods ended June 30, 2010 and 2009, respectively. |
|-----------------|-----------------------------------------------------------------------------------------------------------------------------------|

| (5)   | Net of tax benefit (expense) of $4.2 million and $(1.5) million for the three-month periods ended June 30, 2010 and 2009, respectively. |
|-----------------|-----------------------------------------------------------------------------------------------------------------------------------------|

----

|                                                                                                                                                     | CommonStock |        | AdditionalPaid-InCapital |   | AccumulatedOtherComprehensive(Loss) Income (1) |   | AccumulatedDeficit |         | TotalStockholder’sEquity |
|----------------------------------------------------------------------------------------------------------------------------------------------------------|-------------|-------------|--------------------------|--------|------------------------------------------------|--------|--------------------|--------------|--------------------------------|
|                                                                                                                                                     |        |        |                     |   |                                           |   |               |         |                           |   |   |   |   |   |
| Balance at December 31, 2008                                                                                                                             | $           | 6,437  |                     | $      | 2,872,242                                 |   | $                  | (129,884)    |                           | $ | (1,953,540) |   | $ | 795,255  |
|                                                                                                                                                     |        |        |                     |   |                                           |   |               |         |                           |   |   |   |   |   |
| Cumulative effect of accounting   changes related to the adoption   of FASB ASC Topic 320, net of   tax (2) |        |        |                     |   |                                           |   |               | (9,138)      |                           |   | 9,138  |   |   | -  |
| Net income                                                                                                                                               |        |        |                     |   |                                           |   |               |         |                           |   | 490,924  |   |   | 490,924  |
| Tax benefit from stock options                                                                                                                           |        |        |                     |   | 24                                        |   |               |         |                           |   |   |   |   | 24  |
| Capital contribution from Parent(Note 2)                                                                                                                 |        |        |                     |   | 748,652                                   |   |               |         |                           |   |   |   |   | 748,652  |
| Other comprehensive income                                                                                                                               |        |        |                     |   |                                           |   |               | 53,243  |                           |   |   |   |   | 53,243  |
|                                                                                                                                                     |        |        |                     |   |                                           |   |               |         |                           |   |   |   |   |   |
| Balance at June 30, 2009                                                                                                                                 | $           | 6,437  |                     | $      | 3,620,918                                 |   | $                  | (85,779)     |                           | $ | (1,453,478) |   | $ | 2,088,098 |
|                                                                                                                                                     |        |        |                     |   |                                           |   |               |         |                           |   |   |   |   |   |
|                                                                                                                                                     |        |        |                     |   |                                           |   |               |         |                           |   |   |   |   |   |
|                                                                                                                                                     |        |        |                     |   |                                           |   |               |         |                           |   |   |   |   |   |
| Balance at December 31, 2009                                                                                                                             | $           | 6,437  |                     | $      | 3,527,677                                 |   | $                  | 35,244  |                           | $ | (962,906) |   | $ | 2,606,452  |
|                                                                                                                                                     |        |        |                     |   |                                           |   |               |         |                           |   |   |   |   |   |
| Net income                                                                                                                                               |        |        |                     |   |                                           |   |               |         |                           |   | 256,451  |   |   | 256,451  |
| Tax benefit from stock options                                                                                                                           |        |        |                     |   | 198                                       |   |               |         |                           |   |   |   |   | 198  |
| Capital contribution from Parent(Note 2)                                                                                                                 |        |        |                     |   | 400,000                                   |   |               |         |                           |   | -  |   |   | 400,000  |
| Other comprehensive income                                                                                                                               |        |        |                     |   |                                           |   |               | 17,231  |                           |   |   |   |   | 17,231  |
|                                                                                                                                                     |        |        |                     |   |                                           |   |               |         |                           |   |   |   |   |   |
| Balance at June 30, 2010                                                                                                                                 | $           | 6,437  |                     | $      | 3,927,875                                      |   | $                  | 52,475  |                           | $ | (706,455) |   | $ | 3,280,332  |

|   | (1)  As of June 30, 2010, the total amount of after tax non-credit OTTI losses recorded in the Company’s accumulated other comprehensive income was $8.6 million. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | (2) Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 320, “Investments- Debt and Equity Securities.” |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                                                                                                                   | Unaudited |
|----------------------------------------------------------------------------------------------------------------------------------------|-----------|
|                                                                                                                                   | 2010      |   | 2009 |
|                                                                                                                                   |      |   |   |   |   |
| Cash Flows From Operating Activities:                                                                                                  |      |   |   |   |   |
| Net income                                                                                                                             | $         | 256,451  |   | $ | 490,924  |
| Adjustments to reconcile net income to net cash provided by operating         activities: |      |   |   |   |   |
| Net amortization of premiums on investments                                                                                            |      | 10,365  |   |   | 8,356  |
| Amortization of deferred policy acquisition costs and value of   business and customer renewals acquired                |      | (253,232) |   |   | 401,820  |
| Depreciation and amortization                                                                                                          |      | 2,430  |   |   | 2,806  |
| Net losses (gains) on derivatives                                                                                                      |      | 509,669  |   |   | (228,702) |
| Net realized (gains) losses and OTTI credit losses on available-for-   sale investments                                 |      | (15,454) |   |   | 7,671  |
| Net increase in fair value of trading investments                                                                                      |      | (449,854) |   |   | (941,433) |
| Net realized losses on trading investments                                                                                             |      | 30,822  |   |   | 135,812  |
| Undistributed loss on private equity limited partnerships                                                                              |      | 492  |   |   | 11,750  |
| Interest credited to contractholder deposits                                                                                           |      | 176,811  |   |   | 225,158  |
| Deferred federal income taxes                                                                                                          |      | 143,756  |   |   | 281,509  |
| Changes in assets and liabilities:                                                                                                     |      |   |   |   |   |
| Additions to deferred policy acquisition costs and value of business   and customer renewals acquired                   |      | (117,946) |   |   | (200,553) |
| Accrued investment income                                                                                                              |      | 4,723  |   |   | 963  |
| Net change in reinsurance receivable/payable                                                                                           |      | 36,789  |   |   | 104,163  |
| Future contract and policy benefits                                                                                                    |      | 11,707  |   |   | (50,740) |
| Other, net                                                                                                                             |      | 138,028  |   |   | (134,400) |
| Adjustments related to discontinued operations                                                                                         |      | -  |   |   | 137,204  |
|                                                                                                                                   |      |   |   |   |   |
| Net cash provided by operating activities                                                                                              |      | 485,557  |   |   | 252,308  |
|                                                                                                                                   |      |   |   |   |   |
| Cash Flows From Investing Activities:                                                                                                  |      |   |   |   |   |
| Sales, maturities and repayments of:                                                                                                   |      |   |   |   |   |
| Available-for-sale fixed maturity securities                                                                                           |      | 284,652  |   |   | 26,666  |
| Trading fixed maturity securities                                                                                                      |      | 1,488,444  |   |   | 589,822  |
| Mortgage loans                                                                                                                         |      | 92,420  |   |   | 115,607  |
| Other invested assets                                                                                                                  |      | 152,900  |   |   | 76,420  |
| Purchases of:                                                                                                                          |      |   |   |   |   |
| Available-for-sale fixed maturity securities                                                                                           |      | (602,292) |   |   | (392,624) |
| Trading fixed maturity securities                                                                                                      |      | (2,472,109) |   |   | (131,288) |
| Mortgage loans                                                                                                                         |      | (28,551) |   |   | (55,337) |
| Real estate                                                                                                                            |      | (1,974) |   |   | (45) |
| Other invested assets                                                                                                                  |      | (28,255) |   |   | (57,799) |
| Net change in other investments                                                                                                        |      | -  |   |   | (86,195) |
| Net change in policy loans                                                                                                             |      | 8,756  |   |   | 9,741  |
| Net change in short-term investments (Note 1)                                                                                          |      | 1,192,225  |   |   | 117,829  |
|                                                                                                                                   |      |   |   |   |   |
| Net cash provided by investing activities                                                                                              | $         | 86,216  |   | $ | 212,797  |

----

|                                                |  2010 |            |  2009 |
|-----------------------------------------------------|------------|-----------------|------------|
|                                                |       |            |       |   |   |
| Cash Flows From Financing Activities:               |       |            |       |   |   |
| Additions to contractholder deposit funds           | $          | 647,901    |       | $ | 1,613,327  |
| Withdrawals from contractholder deposit funds       |       | (1,336,122)     |       |   | (1,532,302) |
| Capital contribution from Parent                    |       | 400,000    |       |   | 748,652  |
| Debt proceeds                                       |       | -          |       |   | 100,000  |
| Other, net                                          |       | (12,761)        |       |   | (40,156) |
|                                                |       |            |       |   |   |
| Net cash (used in) provided by financing activities |       | (300,982)       |       |   | 889,521  |
|                                                |       |            |       |   |   |
| Net change in cash and cash equivalents             |       | 270,791    |       |   | 1,354,626  |
|                                                |       |            |       |   |   |
| Cash and cash equivalents, beginning of period      |       | 1,804,208  |       |   | 1,024,668  |
|                                                |       |            |       |   |   |
|                                                |       |            |       |   |   |
| Cash and cash equivalents, end of period            | $          | 2,074,999  |       | $ | 2,379,294  |
|                                                |       |            |       |   |   |

----

----

|                                                               | Six-month period ended |                                                                             | Three-month period ended |
|--------------------------------------------------------------------|------------------------|----------------------------------------------------------------------------------|--------------------------|
|                                                               | June 30, 2009          |                                                                             | June 30, 2009            |
|                                                               |                   |                                                                             |                     |
| Total revenues                                                     |                   | $          (4,010)   |                     |   | $           147,274   |
| Total benefits and expenses                                        |                   | 8,908                                                             |                     |   | 13,288   |
| (Loss) income before income tax   (benefit) expense |                   | (12,918)                                                               |                     |   | 133,986   |
|                                                               |                   |                                                                             |                     |   |   |
| Net (loss) income                                                  |                   | $          (3,784)   |                     |   | $             88,878   |

----

|                                           | As Previously                                                                                                                    |                                         |                                                           |
|------------------------------------------------|----------------------------------------------------------------------------------------------------------------------------------|----------------------------------------------|----------------------------------------------------------------|
|                                           | Reported                                                                                                                         | Adjustments                                  | As Restated                                                    |
| Net change in short-term investments           | $                     - | $     117,829       | $         117,829 |
| Net cash provided by investing activities      | $           94,968                                                        | $     117,829  | $         212,797 |
| Net change in cash and cash equivalents        | $      1,236,797                                                                                   | $     117,829  | $      1,354,626                 |
| Cash and cash equivalents, beginning of period | $      1,624,149                                                                                   | $   (599,481)                 | $      1,024,668                 |
| Cash and cash equivalents, end of period       | $      2,860,946                                                                                   | $   (481,652)                 | $      2,379,294                 |
|                                           |                                                                                                                             |                                         |                                                           |

----

| Ø   | The different classes of assets and liabilities measured at fair value; |
|--------------------|-------------------------------------------------------------------------|

| Ø   | The valuation techniques and inputs used; |
|--------------------|-------------------------------------------|

| Ø   | The transfers between Levels 1, 2, and 3; and |
|--------------------|-----------------------------------------------|

| Ø   | The activity in Level 3 fair value measurements. |
|--------------------|--------------------------------------------------|

----

| Ø   | An embedded derivative feature relating to another type of risk (including another type of credit risk) is present in the securitized financial instrument. |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Ø   | The holder of an interest in a tranche of securitized financial instruments is exposed to the possibility of being required to make potential future payments because the possibility of those future payments is not created by subordination. |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| Ø   | The holder owns an interest in a single-tranche securitization vehicle; therefore, the subordination of one tranche to another is not relevant. |
|--------------------|-------------------------------------------------------------------------------------------------------------------------------------------------|

----

----

----

----

----

|                  | Six-month periods ended |      | Three-month periods ended |   |
|-----------------------|-------------------------|-----------|---------------------------|--------|
|                  | June 30,                |      | June 30,                  |   | June 30, |   | June 30, |   |
|                  | 2010                    |      | 2009                      |   | 2010 |   | 2009 |   |
|                  |                    |      |                      |   |   |   |   |   |   |   |   |   |
| Value of distribution | $                       | 149  |                      | $      | 149  |   | $ | 74  |   | $ | 74  |   |
| VOBA                  |                    | -    |                      |   | 863  |   |   | -  |   |   | 841  |   |
| VOCRA                 |                    | 579  |                      |   | 69  |   |   | 282  |   |   | (657) |   |

----

----

|                                             | Six-month period ended June 30, 2010               |   |                                                                               |
|--------------------------------------------------|----------------------------------------------------|--------|------------------------------------------------------------------------------------|
|                                             |                                               |   |                                                                               |   |   |   |   |   |   |
|                                             | Wealth                                             |   | Individual                                                                         |   | Group |   |   |   |   |
|                                             | Management                                         |   | Protection                                                                         |   | Protection |   | Corporate |   | Totals |
| Total revenues                                   | $      545,477  |   | $       27,671                             |   | $          64,576  |   | $     (33,518) |   | $     604,206  |
| Total benefits and expenses                      | 126,187                                       |   | 26,308                                                                        |   |     61,992  |   |   11,914  |   |     226,401  |
| Income (loss) before incometax expense (benefit) |  419,290                                 |   | 1,363                                                                         |   |    2,584  |   | (45,432) |   |   377,805  |
| Net income (loss)                                | $      282,658  |   | $            971  |   | $            1,682  |   | $     (28,860) |   | $     256,451  |
|                                                                       | Six-month period ended June 30, 2009               |   |                       |
|----------------------------------------------------------------------------|----------------------------------------------------|--------|----------------------------|
|                                                                       |                                               |   |                       |   |   |   |   |   |   |
|                                                                       | Wealth                                             |   | Individual                 |   | Group |   |   |   |   |
|                                                                       | Management                                         |   | Protection                 |   | Protection |   | Corporate |   | Totals |
| Total revenues                                                             | $   1,517,470                  |   | $  31,527   |   | $   69,179  |   | $   (13,089) |   | $  1,605,087  |
| Total benefits and expenses                                                | 733,615                                       |   | 33,105                |   | 55,716  |   | 14,060  |   | 836,496  |
| Income (loss) from continuingoperations before income taxexpense (benefit) | 783,855                                       |   | (1,578)                    |   | 13,463  |   | (27,149) |   | 768,591  |
|                                                                       |                                               |   |                       |   |   |   |   |   |   |
| Net income (loss) from continuing operations                               | 512,509                                       |   | (4,642)                    |   | 8,751  |   | (21,910) |   | 494,708  |
| Loss from discontinued operations, net of tax                         | -                                             |   | (3,784)                    |   | -  |   | -  |   | (3,784) |
|                                                                       |                                               |   |                       |   |   |   |   |   |   |
| Net income (loss)                                                          | $      512,509  |   | $   (8,426) |   | $     8,751  |   | $   (21,910) |   | $     490,924  |

----

|                                             | Three-month period ended June 30, 2010                                   |   |                                                                                           |
|--------------------------------------------------|--------------------------------------------------------------------------|--------|------------------------------------------------------------------------------------------------|
|                                             |                                                                     |   |                                                                                           |   |   |   |   |   |   |
|                                             | Wealth                                                                   |   | Individual                                                                                     |   | Group |   |   |   |   |
|                                             | Management                                                               |   | Protection                                                                                     |   | Protection |   | Corporate |   | Totals |
| Total revenues                                   | $          3,352  |   | $         12,445                             |   | $          32,315  |   | $       (1,382) |   | $        46,730  |
| Total benefits and expenses                      |   (211,278)                                                    |   |    12,093                                                                  |   |   30,844  |   | 1,040  |   |   (167,301) |
| Income (loss) before incometax expense (benefit) |   214,630                                                 |   |      352                                                         |   | 1,471  |   | (2,422) |   |   214,031  |
| Net income (loss)                                | $      144,523                        |   | $              260  |   | $               959  |   | $         (942)  |   | $      144,800  |

|                                                                       | Three-month period ended June 30, 2009             |   |                                                          |
|----------------------------------------------------------------------------|----------------------------------------------------|--------|---------------------------------------------------------------|
|                                                                       |                                               |   |                                                          |   |   |   |   |   |   |
|                                                                       | Wealth                                             |   | Individual                                                    |   | Group |   |   |   |   |
|                                                                       | Management                                         |   | Protection                                                    |   | Protection |   | Corporate |   | Totals |
| Total revenues                                                             | $   1,179,040                  |   | $        19,012  |   | $       35,789  |   | $    (9,101) |   | $   1,224,740  |
| Total benefits and expenses                                                | 614,630                                       |   | 18,884                                                   |   | 28,825  |   | 7,789  |   | 670,128  |
| Income (loss) from continuingoperations before income taxexpense (benefit) | 564,410                                       |   | 128                                                      |   | 6,964  |   | (16,890) |   | 554,612  |
|                                                                       |                                               |   |                                                          |   |   |   |   |   |   |
| Net income (loss) fromcontinuing operations                                | 364,646                                       |   | 299                                                      |   | 4,527  |   | (16,040) |   | 353,432  |
| Income from discontinuedoperations, net of tax                        | -                                             |   | 87,878                                                   |   | -  |   | -  |   | 87,878  |
|                                                                       |                                               |   |                                                          |   |   |   |   |   |   |
| Net income (loss)                                                          | $      364,646  |   | $        88,177  |   | $         4,527  |   | $   (16,040) |   | $      441,310  |

----

----

| ·   | 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. |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                                     |   | Level 1 |             | Level 2 |   | Level 3          |   | Total  |
|----------------------------------------------------------|--------|---------|------------------|---------|--------|------------------|--------|--------|
| Assets                                                   |   |    |             |    |   |             |   |   |   |   |   |   |
| Available-for-sale fixed maturity securities:            |   |    |             |    |   |             |   |   |   |   |   |   |
| Asset-backed securities                                  |   | $       | -           |    | $      | 894         |   | $      | 22  |   | $ | 916  |
| Residential mortgage-backed securities                   |   |    | -           |    |   | 41,511      |   |   | -  |   |   | 41,511  |
| Commercial mortgage-backed securities                    |   |    | -           |    |   | 12,793      |   |   | 1,371  |   |   | 14,164  |
| Foreign government & agency securities               |   |    | -           |    |   | 555         |   |   | -  |   |   | 555  |
| U.S. states and political subdivisions securities        |   |    | -           |    |   | 220         |   |   | -  |   |   | 220  |
| U.S. treasury and agency securities                      |   |    | 372,663     |    |   | -           |   |   | -  |   |   | 372,663  |
| Corporate securities                                     |   |    | -           |    |   | 1,104,646   |   |   | 678  |   |   | 1,105,324  |
| Total available-for-sale fixed maturity securities       |   |    | 372,663     |    |   | 1,160,619   |   |   | 2,071  |   |   | 1,535,353  |
|                                                     |   |    |             |    |   |             |   |   |   |   |   |   |
| Trading fixed maturity securities:                       |   |    |             |    |   |             |   |   |   |   |   |   |
| Asset-backed securities                                  |   |    | -           |    |   | 355,772     |   |   | 47,668  |   |   | 403,440  |
| Residential mortgage-backed securities                   |   |    | -           |    |   | 942,964     |   |   | 98,323  |   |   | 1,041,287  |
| Commercial mortgage-backed securities                    |   |    | -           |    |   | 691,560     |   |   | 62,793  |   |   | 754,353  |
| Foreign government & agency securities               |   |    | -           |    |   | 119,945     |   |   | 14,638  |   |   | 134,583  |
| U.S. states and political subdivisions securities        |   |    | -           |    |   | 629         |   |   | -  |   |   | 629  |
| U.S. treasury and agency securities                      |   |    | 818,782     |    |   | 31,803      |   |   | -  |   |   | 850,585  |
| Corporate securities                                     |   |    | -           |    |   | 8,835,546   |   |   | 48,551  |   |   | 8,884,097  |
| Total trading fixed maturity securities                  |   |    | 818,782     |    |   | 10,978,219  |   |   | 271,973  |   |   | 12,068,974  |
|                                                     |   |    |             |    |   |             |   |   |   |   |   |   |
| Derivative instruments - receivable:                     |   |    |             |    |   |             |   |   |   |   |   |   |
| Interest rate contracts                                  |   |    | -           |    |   | 206,101     |   |   | -  |   |   | 206,101  |
| Foreign currency contracts                               |   |    | -           |    |   | 29,511      |   |   | -  |   |   | 29,511  |
| Equity contracts                                         |   |    | 10,880      |    |   | 21,050      |   |   | 1,723  |   |   | 33,653  |
| Futures                                                  |   |    | 17,105      |    |   | -           |   |   | -  |   |   | 17,105  |
| Total derivative instruments - receivable                |   |    | 27,985      |    |   | 256,662     |   |   | 1,723  |   |   | 286,370  |
|                                                     |   |    |             |    |   |             |   |   |   |   |   |   |
| Other invested assets                                    |   |    | 1,154       |    |   | -           |   |   | 1,614  |   |   | 2,768  |
| Short-term investments                                   |   |    | 75,086      |    |   | -           |   |   | -  |   |   | 75,086  |
| Cash and cash equivalents                                |   |    | 2,074,999   |    |   | -           |   |   | -  |   |   | 2,074,999  |
| Total investments and cash                               |   |    | 3,370,669   |    |   | 12,395,500  |   |   | 277,381  |   |   | 16,043,550  |
|                                                     |   |    |             |    |   |             |   |   |   |   |   |   |
| Separate account assets:                                 |   |    |             |    |   |             |   |   |   |   |   |   |
| Mutual fund investments                                  |   |    | 18,422,259  |    |   | 33,187      |   |   | -  |   |   | 18,455,446  |
| Equity investments                                       |   |    | 156,153     |    |   | 69,886      |   |   | 197  |   |   | 226,236  |
| Fixed income investments                                 |   |    | 545,739     |    |   | 4,930,857   |   |   | 92,963  |   |   | 5,569,559  |
| Alternative investments                                  |   |    | 6,584       |    |   | 82,797      |   |   | 269,757  |   |   | 359,138  |
| Other investments                                        |   |    | 36          |    |   | -           |   |   | -  |   |   | 36  |
| Total separate account assets (1) (2)                    |   |    | 19,130,771  |    |   | 5,116,727   |   |   | 362,917  |   |   | 24,610,415  |
|                                                     |   |    |             |    |   |             |   |   |   |   |   |   |
| Total assets measured at fair value on a recurring basis |   | $       | 22,501,440  |    | $      | 17,512,227  |   | $      | 640,298  |   | $ | 40,653,965  |

|   | (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 $1,006.0 million primarily related to investment purchases payable, net of investment sales receivable, that are not subject to FASB ASC Topic 820. |
|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                                          |   | Level 1 |         | Level 2 |   | Level 3       |   | Total  |
|---------------------------------------------------------------|--------|---------|--------------|---------|--------|---------------|--------|--------|
| Liabilities                                                   |   |    |         |    |   |          |   |   |   |   |   |   |
| Other policy liabilities:                                     |   |    |         |    |   |          |   |   |   |   |   |   |
| Guaranteed minimum withdrawal benefit liability               |   | $       | -       |    | $      | -        |   | $      | 618,029  |   | $ | 618,029  |
| Guaranteed minimum accumulation benefit liability             |   |    | -       |    |   | -        |   |   | 231,911  |   |   | 231,911  |
| Derivatives embedded in reinsurance contracts                 |   |    | -       |    |   | 51,055   |   |   | -  |   |   | 51,055  |
| Fixed index annuities                                         |   |    | -       |    |   | -        |   |   | 118,287  |   |   | 118,287  |
| Total other policy liabilities                                |   |    | -       |    |   | 51,055   |   |   | 968,227  |   |   | 1,019,282  |
|                                                          |   |    |         |    |   |          |   |   |   |   |   |   |
| Derivative instruments – payable:                       |   |    |         |    |   |          |   |   |   |   |   |   |
| Interest rate contracts                                       |   |    | -       |    |   | 560,939  |   |   | -  |   |   | 560,939  |
| Foreign currency contracts                                    |   |    | -       |    |   | 5,690    |   |   | -  |   |   | 5,690  |
| Credit contracts                                              |   |    | -       |    |   | -        |   |   | 33,726  |   |   | 33,726  |
| Futures                                                       |   |    | 2,435   |    |   | -        |   |   | -  |   |   | 2,435  |
| Total derivative instruments – payable                  |   |    | 2,435   |    |   | 566,629  |   |   | 33,726  |   |   | 602,790  |
|                                                          |   |    |         |    |   |          |   |   |   |   |   |   |
| Other liabilities:                                            |   |    |         |    |   |          |   |   |   |   |   |   |
| Bank overdrafts                                               |   |    | 47,077  |    |   | -        |   |   | -  |   |   | 47,077  |
|                                                          |   |    |         |    |   |          |   |   |   |   |   |   |
| Total liabilities measured at fair value on a recurring basis |   | $       | 49,512  |    | $      | 617,684  |   | $      | 1,001,953  |   | $ | 1,669,149  |
|                                                          |   |    |         |    |   |          |   |   |   |   |   |   |

----

|                                                     |   | Level 1 |       | Level 2 |   | Level 3    |   | Total  |
|----------------------------------------------------------|--------|---------|------------|---------|--------|------------|--------|--------|
| Assets                                                   |   |    |       |    |   |       |   |   |   |   |   |   |
| Available-for-sale fixed maturity securities:            |   |    |       |    |   |       |   |   |   |   |   |   |
| Asset-backed securities                                  |   | $       | -          |    | $      | 952        |   | $      | 37 |   | $ | 989 |
| Residential mortgage-backed securities                   |   |    | -          |    |   | 47,701     |   |   | - |   |   | 47,701 |
| Commercial mortgage-backed securities                    |   |    | -          |    |   | 14,150     |   |   | 1,930 |   |   | 16,080 |
| Foreign government & agency securities               |   |    | -          |    |   | 760        |   |   | - |   |   | 760 |
| U.S. treasury and agency securities                      |   |    | 39,131     |    |   | -          |   |   | - |   |   | 39,131 |
| Corporate securities                                     |   |    | -          |    |   | 1,062,919  |   |   | 7,936 |   |   | 1,070,855 |
| Total available-for-sale fixed maturity securities       |   |    | 39,131     |    |   | 1,126,482  |   |   | 9,903 |   |   | 1,175,516 |
|                                                     |   |    |       |    |   |       |   |   |   |   |   |   |
| Trading fixed maturity securities:                       |   |    |       |    |   |       |   |   |   |   |   |   |
| Asset-backed securities                                  |   |    | -          |    |   | 355,613    |   |   | 111,650 |   |   | 467,263 |
| Residential mortgage-backed securities                   |   |    | -          |    |   | 886,340    |   |   | 154,551 |   |   | 1,040,891 |
| Commercial mortgage-backed securities                    |   |    | -          |    |   | 624,845    |   |   | 14,084 |   |   | 638,929 |
| Foreign government & agency securities               |   |    | -          |    |   | 67,925     |   |   | 15,323 |   |   | 83,248 |
| U.S. treasury and agency securities                      |   |    | 503,123    |    |   | 34,407     |   |   | - |   |   | 537,530 |
| Corporate securities                                     |   |    | -          |    |   | 8,254,775  |   |   | 107,886 |   |   | 8,362,661 |
| Total trading fixed maturity securities                  |   |    | 503,123    |    |   | 10,223,905 |   |   | 403,494 |   |   | 11,130,522 |
|                                                     |   |    |       |    |   |       |   |   |   |   |   |   |
| Derivative instruments - receivable                      |   |    | 14,922     |    |   | 235,484    |   |   | 8,821 |   |   | 259,227 |
| Other invested assets                                    |   |    | 20,242     |    |   | 206        |   |   | - |   |   | 20,448 |
| Short-term investments                                   |   |    | 1,267,311  |    |   | -          |   |   | - |   |   | 1,267,311 |
| Cash and cash equivalents                                |   |    | 1,804,208  |    |   | -          |   |   | - |   |   | 1,804,208 |
| Total investments and cash                               |   |    | 3,648,937  |    |   | 11,586,077 |   |   | 422,218 |   |   | 15,657,232 |
|                                                     |   |    |       |    |   |       |   |   |   |   |   |   |
| Other assets                                             |   |    |       |    |   |       |   |   |   |   |   |   |
| Separate account assets (1) (2)                          |   |    | 18,045,908 |    |   | 5,233,602  |   |   | 547,841 |   |   | 23,827,351 |
|                                                     |   |    |       |    |   |       |   |   |   |   |   |   |
| Total assets measured at fair value on a recurring basis |   | $       | 21,694,845 |    | $      | 16,819,679 |   | $      | 970,059 |   | $ | 39,484,583 |

|   | (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 $501.0 million primarily related to investment sales receivable, net of investment purchases payable, that are not subject to FASB ASC Topic 820. |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                                          |   | Level 1 |   | Level 2 |   | Level 3       |   | Total  |
|---------------------------------------------------------------|--------|---------|--------|---------|--------|---------------|--------|--------|
| Liabilities                                                   |   |    |   |    |   |          |   |   |   |   |   |   |
| Other policy liabilities:                                     |   |    |   |    |   |          |   |   |   |   |   |   |
| Guaranteed minimum withdrawal benefit liability               |   | $       | -      |    | $      | -        |   | $      | 168,786 |   | $ | 168,786 |
| Guaranteed minimum accumulation benefit liability             |   |    | -      |    |   | -        |   |   | 81,669 |   |   | 81,669 |
| Derivatives embedded in reinsurance contracts                 |   |    | -      |    |   | 15,035        |   |   | -  |   |   | 15,035 |
| Fixed index annuities                                         |   |    | -      |    |   | -        |   |   | 140,966 |   |   | 140,966 |
| Total other policy liabilities                                |   |    | -      |    |   | 15,035        |   |   | 391,421 |   |   | 406,456 |
|                                                          |   |    |   |    |   |          |   |   |   |   |   |   |
| Derivative instruments – payable                        |   |    | 5,256  |    |   | 533,305  |   |   | 34,349 |   |   | 572,910 |
|                                                          |   |    |   |    |   |          |   |   |   |   |   |   |
| Other liabilities:                                            |   |    |   |    |   |          |   |   |   |   |   |   |
| Bank overdrafts                                               |   |    | 60,037 |    |   | -        |   |   | - |   |   | 60,037 |
|                                                          |   |    |   |    |   |          |   |   |   |   |   |   |
| Total liabilities measured at fair value on a recurring basis |   | $       | 65,293 |    | $      | 548,340  |   | $      | 425,770 |   | $ | 1,039,403 |

|   |   | Level 1 |    | Level 2 |   | Level 3 |   | TotalFair Value |              | Total Gains(Losses) |
|--------|--------|---------|---------|---------|--------|---------|--------|-----------------|-------------------|---------------------|
| Asset  |   |    |    |    |   |    |   |            |              |                |   |   |   |   |   |
| VOCRA  |   | $       | -  |    | $      | -  |   | $               | 5,766   |                | $ | 5,766  |   | $ | (2,600)  |

----

----

----

| Assets                                                                          | Beginningbalance                                          | Total realized and unrealized gains (losses) | Purchases,issuances, andsettlements (net)                                                    | Transfers inand/or (out) oflevel 3                                                                                                           | Ending balance                                                                                                 | Change in total gains(losses) included inearnings relating toinstruments still held atthe reporting date                    |
|---------------------------------------------------------------------------------|-----------------------------------------------------------|---------------------------------------------------|----------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------------------|-----------------------------------------------------------------------------------------------------------------------------|
| Includedinearnings                                                              | Included inothercomprehensiveincome                       |
| Available-for-sale fixed maturity securities:                                   |                                                      |                                              |                                                                                         |                                                                                                                                         |                                                                                                           |                                                                                                                        |   |
| Asset-backed securities                                                         | $        37  | $   (22)                           | $              7  | $                      -  | $                 -  | $                   22  | $                              -  |
| Residential mortgage-backed securities                                          | -                                                    | -                                            | -                                                                                       | -                                                                                                                                       | -                                                                                                         | -                                                                                                                      | -  |
| Commercial mortgage-backedsecurities                                            | 1,930                                                | (307)                                             | (252)                                                                                        | -                                                                                                                                       | -                                                                                                         | 1,371                                                                                                                  | -  |
| Foreign government & agency     securities         | -                                                    | -                                            | -                                                                                       | -                                                                                                                                       | -                                                                                                         | -                                                                                                                      | -  |
| U.S. states and political subdivisionssecurities                                | -                                                    | -                                            | -                                                                                       | -                                                                                                                                       | -                                                                                                         | -                                                                                                                      | -  |
| U.S. treasury and agency securities                                             | -                                                    | -                                            | -                                                                                       | -                                                                                                                                       | -                                                                                                         | -                                                                                                                      | -  |
| Corporate securities                                                            | 7,936                                                | (12)                                              | (5)                                                                                          | (57)                                                                                                                                         | (7,184)                                                                                                        | 678                                                                                                                    | -  |
| Total available-for-sale fixed maturity     securities | 9,903                                                | (341)                                             | (250)                                                                                        | (57)                                                                                                                                    | (7,184)                                                                                                        | 2,071                                                                                                                  | -  |
|                                                                            |                                                      |                                              |                                                                                         |                                                                                                                                         |                                                                                                           |                                                                                                                        |   |
| Trading fixed maturity securities:                                              |                                                      |                                              |                                                                                         |                                                                                                                                         |                                                                                                           |                                                                                                                        |   |
| Asset-backed securities                                                         | 111,650                                              | (8,524)                                           | -                                                                                       | (18,975)                                                                                                                                     | (36,483)                                                                                                       | 47,668                                                                                                                 | 7,159  |
| Residential mortgage-backed securities                                          | 154,551                                              | 2,505                                        | -                                                                                       | (6,416)                                                                                                                                      | (52,317)                                                                                                       | 98,323                                                                                                                 | 5,066  |
| Commercial mortgage-backed     securities              | 14,084                                               | 798                                          | -                                                                                       | 48,607                                                                                                                                  | (696)                                                                                                          | 62,793                                                                                                                 | 1,670  |
| Foreign government & agency     securities         | 15,323                                               | (685)                                        | -                                                                                       | -                                                                                                                                       | -                                                                                                         | 14,638                                                                                                                 | 103  |
| U.S. states and political subdivisions     securities  | -                                                    | -                                            | -                                                                                       | -                                                                                                                                       | -                                                                                                         | -                                                                                                                      | -  |
| U.S. treasury and agency securities                                             | -                                                    | -                                            | -                                                                                       | -                                                                                                                                       | -                                                                                                         | -                                                                                                                      | -  |
| Corporate securities                                                            | 107,886                                              | (6,196)                                           | -                                                                                       | 2,187                                                                                                                                   | (55,326)                                                                                                       | 48,551                                                                                                                 | 1,635  |
| Total trading fixed maturity securities                                         | 403,494                                              | (12,102)                                          | -                                                                                       | 25,403                                                                                                                                  | (144,822)                                                                                                      | 271,973                                                                                                                | 15,633  |
|                                                                            |                                                      |                                              |                                                                                         |                                                                                                                                         |                                                                                                           |                                                                                                                        |   |
| Derivative instruments – receivable:                                      |                                                      |                                              |                                                                                         |                                                                                                                                         |                                                                                                           |                                                                                                                        |   |
| Interest rate contracts                                                         | -                                                    | -                                            | -                                                                                       | -                                                                                                                                       | -                                                                                                         | -                                                                                                                      | -  |
| Foreign currency contracts                                                      | -                                                    | -                                            | -                                                                                       | -                                                                                                                                       | -                                                                                                         | -                                                                                                                      | -  |
| Equity contracts                                                                | 8,821                                                | (3,894)                                           | -                                                                                       | (3,204)                                                                                                                                      | -                                                                                                         | 1,723                                                                                                                  | (3,894) |
| Futures                                                                         | -                                                    | -                                            | -                                                                                       | -                                                                                                                                       | -                                                                                                         | -                                                                                                                      | -  |
| Total derivative instruments– receivable                                  | 8,821                                                | (3,894)                                           | -                                                                                       | (3,204)                                                                                                                                      | -                                                                                                         | 1,723                                                                                                                  | (3,894) |
|                                                                            |                                                      |                                              |                                                                                         |                                                                                                                                         |                                                                                                           |                                                                                                                        |   |
| Other invested assets                                                           | -                                                    | 128                                          | -                                                                                       | 1,486                                                                                                                                   | -                                                                                                         | 1,614                                                                                                                  | 127  |
| Short-term investments                                                          | -                                                    | -                                            | -                                                                                       | -                                                                                                                                       | -                                                                                                         | -                                                                                                                      | -  |
| Cash and cash equivalents                                                       | -                                                    | -                                            | -                                                                                       | -                                                                                                                                       | -                                                                                                         | -                                                                                                                      | -  |
| Total investments and cash                                                      | 422,218                                              | (16,209)                                          | (250)                                                                                        | 23,628                                                                                                                                  | (152,006)                                                                                                      | 277,381                                                                                                                | 11,866  |
|                                                                            |                                                      |                                              |                                                                                         |                                                                                                                                         |                                                                                                           |                                                                                                                        |   |
| Separate account assets:                                                        |                                                      |                                              |                                                                                         |                                                                                                                                         |                                                                                                           |                                                                                                                        |   |
| Mutual fund investments                                                         | -                                                         | -                                            | -                                                                                       | -                                                                                                                                       | -                                                                                                         | -                                                                                                                      | -  |
| Equity investments                                                              | 7                                                         | 11                                           | -                                                                                       | 179                                                                                                                                     | -                                                                                                         | 197                                                                                                                    | 10  |
| Fixed income investments                                                        | 276,530                                                   | 4,140                                        | -                                                                                       | (78,387)                                                                                                                                     | (109,320)                                                                                                      | 92,963                                                                                                                 | 1,313  |
| Alternative investments                                                         | 267,196                                                   | (10,652)                                          | -                                                                                       | 16,182                                                                                                                                  | (2,969)                                                                                                        | 269,757                                                                                                                | (10,741) |
| Other investments                                                               | 4,108                                                     | -                                            | -                                                                                       | -                                                                                                                                       | (4,108)                                                                                                        | -                                                                                                                      | -  |
| Total separate account assets (1)                                               | 547,841                                                   | (6,501)                                           | -                                                                        | (62,026)                                                                                                                                     | (116,397)                                                                                                      | 362,917                                                                                                                | (9,418) |
|                                                                            |                                                      |                                              |                                                                                         |                                                                                                                                         |                                                                                                           |                                                                                                                        |   |
| Total assets measured at fair value ona recurring basis                    | $970,059                                             | $(22,710)                                         | $            (250)               | $            (38,398)                                                            | $    (268,403)                                                                             | $        640,298                                                               | $                      2,448  |

|   | (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. |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| Liabilities                                                  | Beginningbalance                    | Total realized and unrealized  (gains) losses | Purchases,issuances, andsettlements (net)                                                                                                    | Transfers inand/or (out) oflevel 3                                        | Endingbalance                                                                                                              | Change in total (gains)losses included inearnings relating toinstruments still held atthe reporting date |
|--------------------------------------------------------------|-------------------------------------|---------------------------------------------------------|----------------------------------------------------------------------------------------------------------------------------------------------|---------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------------|
| Includedinearnings                                           | Included inothercomprehensiveincome |
|                                                         |                                |                                                    |                                                                                                                                         |                                                                      |                                                                                                                       |                                                                                                     |   |
| Other policy liabilities:                                    |                                |                                                    |                                                                                                                                         |                                                                      |                                                                                                                       |                                                                                                     |   |
| Guaranteed minimum withdrawal benefitliability               | $168,786                       | $385,563                                      | $                      -  | $63,680                                                         | $                   -  | $        618,029                                            | $                  387,678  |
| Guaranteed minimum accumulationbenefit liability             | 81,669                    | 138,727                                       | -                                                                                                                                       | 11,515                                                          | -                                                                                                                     | 231,911                                                                                             | 139,536  |
| Derivatives embedded in reinsurancecontracts                 | -                         | -                                             | -                                                                                                                                       | -                                                               | -                                                                                                                     | -                                                                                                   | -  |
| Fixed index annuities                                        | 140,966                   | (27,126 )                                          | -                                                                                                                                       | 4,447                                                           | -                                                                                                                     | 118,287                                                                                             | (7,166) |
| Total other policy liabilities                               | 391,421                        | 497,164                                            | -                                                                                                                                       | 79,642                                                          | -                                                                                                                     | 968,227                                                                                             | 520,048  |
|                                                         |                                |                                                    |                                                                                                                                         |                                                                      |                                                                                                                       |                                                                                                     |   |
| Derivative instruments – payable:                      |                                |                                                    |                                                                                                                                         |                                                                      |                                                                                                                       |                                                                                                     |   |
| Interest rate contracts                                      | -                              | -                                                  | -                                                                                                                                       | -                                                                    | -                                                                                                                     | -                                                                                                   | -  |
| Foreign currency contracts                                   | -                              | -                                                  | -                                                                                                                                       | -                                                                    | -                                                                                                                     | -                                                                                                   | -  |
| Credit contracts                                             | 34,349                         | (623)                                                   | -                                                                                                                                       | -                                                                    | -                                                                                                                     | 33,726                                                                                              | (623) |
| Futures                                                      | -                              | -                                                  | -                                                                                                                                       | -                                                                    | -                                                                                                                     | -                                                                                                   | -  |
| Total derivative instruments – payable                 | 34,349                         | (623)                                                   | -                                                                                                                                       | -                                                                    | -                                                                                                                     | 33,726                                                                                              | (623) |
|                                                         |                                |                                                    |                                                                                                                                         |                                                                      |                                                                                                                       |                                                                                                     |   |
|                                                         |                                |                                                    |                                                                                                                                         |                                                                      |                                                                                                                       |                                                                                                     |   |
| Other liabilities:                                           |                                |                                                    |                                                                                                                                         |                                                                      |                                                                                                                       |                                                                                                     |   |
| Bank overdrafts                                              | -                              | -                                                  | -                                                                                                                                       | -                                                                    | -                                                                                                                     | -                                                                                                   | -  |
|                                                         |                                |                                                    |                                                                                                                                         |                                                                      |                                                                                                                       |                                                                                                     |   |
| Total liabilities measured at fair value ona recurring basis | $425,770                       | $ 496,541                                          | $               -                                            | $          79,642  | $               -                          | $       1,001,953                                                | $     519,425  |

|                                                                                                          |   | Total realized gains(losses) included inearnings |   | Change inunrealized gains(losses) related toassets still held  atthe reporting date |
|---------------------------------------------------------------------------------------------------------------|--------|--------------------------------------------------|--------|-----------------------------------------------------------------------------------------------|
| Net investment (loss) income                                                                                  | $      | (11,974)                                         | $      | 15,760                                                                                   |
| Net derivative loss                                                                                           |   | (500,435)                                        |   | (523,319)                                                                                     |
| Net realized investment losses, excluding impairment   losses on available-for-sale securities |   | (341)                                            |   | -                                                                                        |
| Net losses                                                                                                    | $      | (512,750)                                        | $      | (507,559)                                                                                     |

----

| Assets              | Beginningbalance                     | Total realized and unrealizedgains (losses) | Purchases,issuances, andsettlements (net) | Transfers inand/or (out) oflevel 3 (2) | Endingbalance | Change in total gains(losses) included inearnings relating toinstruments still heldat the reporting date |
|---------------------|--------------------------------------|---------------------------------------------|-------------------------------------------|----------------------------------------|---------------|----------------------------------------------------------------------------------------------------------|
| Included inearnings | Included in othercomprehensiveincome |
| Available-for-sale fixed maturity securities:                      |                                                                                         |                                                                                         |                                                                                               |                                                                                         |                                                                                               |                                                                                   |                                                                                               |
|--------------------------------------------------------------------|----------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------|
| Asset-backed and mortgage-backed   securities       | $              -  | $               - | $                - | $               - | $               -  | $             -  | $               -  |
| Collateralized mortgage obligations                                | 3,046                                                                                   | 45                                                                                      | (448)                                                                                              | -                                                                                       | -                                                                                             | 2,643                                                                             | -                                                                                             |
| Commercial mortgage-backed   securities             | 1,420                                                                                   | (29)                                                                                         | 7                                                                                             | -                                                                                       | (1,343)                                                                                            | 55                                                                                | -                                                                                             |
| Foreign government & agency securities                         | -                                                                                       | -                                                                                       | -                                                                                             | -                                                                                       | -                                                                                             | -                                                                                 | -                                                                                             |
| U.S. states and political subdivisions   securities | -                                                                                       | -                                                                                       | -                                                                                             | -                                                                                       | -                                                                                             | -                                                                                 | -                                                                                             |
| U.S. treasury and agency securities                                | -                                                                                       | -                                                                                       | -                                                                                             | -                                                                                       | -                                                                                             | -                                                                                 | -                                                                                             |
| Corporate securities                                               | 7,888                                                                                   | 242                                                                                     | 273                                                                                           | 3,036                                                                                   | (1,414)                                                                                            | 10,025                                                                            | -                                                                                             |
| Total available-for-sale fixed maturity securities                 | 12,354                                                                                  | 258                                                                                     | (168)                                                                                              | 3,036                                                                                   | (2,757)                                                                                            | 12,723                                                                            | -                                                                                             |
|                                                               |                                                                                         |                                                                                         |                                                                                               |                                                                                         |                                                                                               |                                                                                   |                                                                                               |
| Trading fixed maturity securities:                                 |                                                                                         |                                                                                         |                                                                                               |                                                                                         |                                                                                               |                                                                                   |                                                                                               |
| Asset-backed and mortgage-backed   securities       | 145,267                                                                                 | 16,417                                                                                  | -                                                                                             | (4,371)                                                                                      | (8,148)                                                                                            | 149,165                                                                           | 27,738                                                                                        |
| Collateralized mortgage obligations                                | 116,572                                                                                 | (6,792)                                                                                      | -                                                                                             | (6,448)                                                                                      | 37,201                                                                                        | 140,533                                                                           | 9,611                                                                                         |
| Commercial mortgage-backed   securities             | 200,414                                                                                 | 5,436                                                                                   | -                                                                                             | (253)                                                                                        | -                                                                                             | 205,597                                                                           | 67,121                                                                                        |
| Foreign government & agency   securities        | 9,200                                                                                   | 305                                                                                     | -                                                                                             | (105)                                                                                        | -                                                                                        | 9,400                                                                             | 200                                                                                           |
| U.S. states and political subdivisions   securities | -                                                                                       | -                                                                                       | -                                                                                             | -                                                                                       | -                                                                                        | -                                                                                 | -                                                                                             |
| U.S. treasury and agency securities                                | -                                                                                       | -                                                                                       | -                                                                                             | -                                                                                       | -                                                                                        | -                                                                                 | -                                                                                             |
| Corporate securities                                               | 134,505                                                                                 | 10,377                                                                                  | -                                                                                             | 4,915                                                                                   | (32,412)                                                                                           | 117,385                                                                           | 14,312                                                                                        |
| Total trading fixed maturity securities                            | 605,958                                                                                 | 25,743                                                                                  | -                                                                                             | (6,262)                                                                                      | (3,359)                                                                                            | 622,080                                                                           | 118,982                                                                                       |
|                                                               |                                                                                         |                                                                                         |                                                                                               |                                                                                         |                                                                                               |                                                                                   |                                                                                               |
| Derivative instruments – receivable                          | 2,668                                                                                   | 46                                                                                      | -                                                                                             | 385                                                                                     | -                                                                                             | 3,099                                                                             | 46                                                                                            |
| Other invested assets                                              | -                                                                                       | -                                                                                       | -                                                                                             | -                                                                                       | -                                                                                             | -                                                                                 | -                                                                                             |
| Short-term investments                                             | -                                                                                       | -                                                                                       | -                                                                                             | -                                                                                       | -                                                                                             | -                                                                                 | -                                                                                             |
| Cash and cash equivalents                                          | -                                                                                       | -                                                                                       | -                                                                                             | -                                                                                       | -                                                                                             | -                                                                                 | -                                                                                             |
| Total investments and cash                                         | 620,980                                                                                 | 26,047                                                                                  | (168)                                                                                              | (2,841)                                                                                      | (6,116)                                                                                            | 637,902                                                                           | 119,028                                                                                       |
|                                                               |                                                                                         |                                                                                         |                                                                                               |                                                                                         |                                                                                               |                                                                                   |                                                                                               |
| Other assets                                                       |                                                                                         |                                                                                         |                                                                                               |                                                                                         |                                                                                               |                                                                                   |                                                                                               |
| Separate account assets (1)                                        | 801,873                                                                                 | 25,804                                                                             | -                                                                                             | (66,872)                                                                                     | (39,879)                                                                                 | 720,926                                                                           | 125,100                                                                                       |
|                                                               |                                                                                         |                                                                                         |                                                                                               |                                                                                         |                                                                                               |                                                                                   |                                                                                               |
| Total assets measured at fair value on arecurring basis            | $1,422,853                                                                              | $     51,851                                                   | $          (168)                                 | $     (69,713)                                                      | $    (45,995)                                                                  | $1,358,828                                                                        | $    244,128                                                              |

|   | (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 six-month period ended June 30, 2009 are primarily attributable to changes in the observability of inputs used to price the securities. |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| Liabilities                                                                                      | Beginningbalance                     | Total realized and unrealized(gains) losses | Purchases, issuances, andsettlements (net)                                        | Transfers inand/or (out) oflevel 3                | Endingbalance                                      | Change in total (gains)losses included inearnings relating toinstruments still held atthe reporting date |
|--------------------------------------------------------------------------------------------------|--------------------------------------|---------------------------------------------|----------------------------------------------------------------------------------------|---------------------------------------------------|----------------------------------------------------|----------------------------------------------------------------------------------------------------------|
| Included inearnings                                                                              | Included in othercomprehensiveincome |
|                                                                                             |                                 |                                        |                                                                                   |                                              |                                               |                                                                                                     |   |
| Other policy liabilities:                                                                        |                                 |                                        |                                                                                   |                                              |                                               |                                                                                                     |   |
|   Guaranteed minimum withdrawal     benefit liability         | $  335,612            | $   (82,247)                 | $            -        | $      27,124  | $       -  | $280,489                                                                                            | $        (74,916) |
|    Guaranteed minimum accumulation     benefit liability | 358,604                         | (170,707)                                   | -                                                                                 | 9,892                                        | -                                             | 197,789                                                                                             | (165,068) |
|   Derivatives embedded in reinsurance contracts                                        | -                               | -                                      | -                                                                                 | -                                            | -                                             | -                                                                                                   | -  |
|    Fixed index annuities                                                          | 106,619                         | (1,151)                                     | -                                                                                 | (2,677)                                           | -                                             | 102,791                                                                                             | (4,081) |
| Total other policy liabilities                                                                   | 800,835                         | (254,105)                                   | -                                                                                 | 34,339                                       | -                                             | 581,069                                                                                             | (244,065) |
|                                                                                             |                                 |                                        |                                                                                   |                                              |                                               |                                                                                                     |   |
| Derivative instruments – payable                                                           | 42,066                          | 4,130                                  | -                                                                                 | -                                            | -                                             | 46,196                                                                                              | 4,130  |
|                                                                                             |                                 |                                        |                                                                                   |                                              |                                               |                                                                                                     |   |
| Total liabilities measured at fair value on    a recurring basis             | $   842,901      | $ (249,975)                                 | $             -  | $  34,339                          | $      -        | $627,265                                                                                            | $      (239,935) |

|                                                                                       |   | Total realizedgains (losses)included inearnings |   | Change inunrealized gains(losses) related toassets still held  atthe reporting date |
|--------------------------------------------------------------------------------------------|--------|-------------------------------------------------|--------|-----------------------------------------------------------------------------------------------|
| Net investment income                                                                      | $      | 25,743                                     | $      | 118,982                                                                                  |
| Net derivative income                                                                      |   | 250,021                                    |   | 239,981                                                                                  |
| Net realized investment gains, excludingimpairment losses on available-for-sale securities |   | 258                                        |   | -                                                                                        |
| Net gains                                                                                  | $      | 276,022                                    | $      | 358,963                                                                                  |

----

| Assets                                                                    | Beginningbalance                    | Total realized and unrealizedgains (losses) | Purchases,issuances, andsettlements (net)                                    | Transfers inand/or (out) oflevel 3                                                            | Endingbalance                                            | Change in total gains(losses) included in earningsrelating to instruments stillheld at the reporting date |
|---------------------------------------------------------------------------|-------------------------------------|---------------------------------------------|------------------------------------------------------------------------------|-----------------------------------------------------------------------------------------------|----------------------------------------------------------|-----------------------------------------------------------------------------------------------------------|
| Included inearnings                                                       | Included inothercomprehensiveincome |
|                                                                      |                                |                                        |                                                                         |                                                                                          |                                                     |                                                                                                      |   |
| Available-for-sale fixed maturity securities:                             |                                |                                        |                                                                         |                                                                                          |                                                     |                                                                                                      |   |
| Asset-backed securities                                                   | $     29   | $   (10)                | $         3                | $              -   | $        -  | $        22                                             | $                     -  |
| Residential mortgage-backed securities                                    | -                                   | -                                      | -                                                                       | -                                                                                        | -                                                   | -                                                                                                    | -  |
| Commercial mortgage-backed    securities              | 1,135                               | (64)                                   | 300                                                                | -                                                                                        | -                                                   | 1,371                                                                                           | -  |
| Foreign government & agency    securities         | -                                   | -                                      | -                                                                       | -                                                                                        | -                                                   | -                                                                                                    | -  |
| U.S. states and political subdivisions    securities  | -                                   | -                                      | -                                                                       | -                                                                                        | -                                                   | -                                                                                                    | -  |
| U.S. treasury and agency securities                                       | -                                   | -                                           | -                                                                            | -                                                                                             | -                                                        | -                                                                                                         | -  |
| Corporate securities                                                      | 939                                 | (6)                                         | (1)                                                                          | -                                                                                        | (254)                                               | 678                                                                                             | -  |
| Total available-for-sale fixed maturity    securities |  2,103                         | (80)                                   | 302                                                                | -                                                                                        | (254)                                               | 2,071                                                                                      | -  |
|                                                                      |                                |                                        |                                                                         |                                                                                          |                                                     |                                                                                                      |   |
| Trading fixed maturity securities:                                        |                                |                                        |                                                                         |                                                                                          |                                                     |                                                                                                      |   |
| Asset-backed securities                                                   | 48,924                              | 769                                    | -                                                                       | (261)                                                                                    | (1,764)                                             | 47,668                                                                                               | 921  |
| Residential mortgage-backed securities                                    | 105,554                             | 473                                    | -                                                                       | (3,268)                                                                                  | (4,436)                                             | 98,323                                                                                               | 1,388  |
| Commercial mortgage-backed    securities              | 12,892                              | 1,294                                  | -                                                                       | 48,607                                                                                   | -                                                   | 62,793                                                                                               | 2,439  |
| Foreign government & agency    securities         | 15,093                              | (455)                                  | -                                                                       | -                                                                                        | -                                                   | 14,638                                                                                               | (58) |
| U.S. states and political subdivisions    securities  | -                         | -                                      | -                                                                       | -                                                                                        | -                                                   | -                                                                                                    | -  |
| U.S. treasury and agency securities                                       | -                         | -                                      | -                                                                       | -                                                                                        | -                                                   | -                                                                                                    | -  |
| Corporate securities                                                      | 96,653                         | (6,863)                                     | -                                                                       | 4,416                                                                                    | (45,655)                                                 | 48,551                                                                                               | 979  |
| Total trading fixed maturity securities                                   | 279,116                        | (4,782)                                     | -                                                                       | 49,494                                                                                   | (51,855)                                                 | 271,973                                                                                              | 5,669  |
|                                                                      |                                |                                        |                                                                         |                                                                                          |                                                     |                                                                                                      |   |
| Derivative instruments – receivable:                                |                                |                                        |                                                                         |                                                                                          |                                                     |                                                                                                      |   |
| Interest rate contracts                                                   | -                              | -                                      | -                                                                       | -                                                                                        | -                                                   | -                                                                                                    | -  |
| Foreign currency contracts                                                | -                              | -                                      | -                                                                       | -                                                                                        | -                                                   | -                                                                                                    | -  |
| Equity contracts                                                          | 11,956                         | (7,048)                                     | -                                                                       | (3,185)                                                                                       | -                                                   | 1,723                                                                                                | (7,049) |
| Futures                                                                   | -                              | -                                      | -                                                                       | -                                                                                        | -                                                   | -                                                                                                    | -  |
| Total derivative instruments– receivable                            | 11,956                         | (7,048)                                | -                                                                       | (3,185)                                                                                       | -                                                   | 1,723                                                                                                | (7,049) |
|                                                                      |                                |                                        |                                                                         |                                                                                          |                                                     |                                                                                                      |   |
| Other invested assets                                                     | -                              | 128                                    | -                                                             | 1,486                                                                                    | -                                                   | 1,614                                                                                                | 128  |
| Short-term investments                                                    | -                              | -                                      | -                                                                       | -                                                                                        | -                                                   | -                                                                                                    | -  |
| Cash and cash equivalents                                                 | -                              | -                                      | -                                                                       | -                                                                                        | -                                                   | -                                                                                                    | -  |
| Total investments and cash                                                | 293,175                        | (11,782)                               | 302                                                                     | 47,795                                                                                   | (52,109)                                                 | 277,381                                                                                              | (1,252) |
|                                                                      |                                |                                        |                                                                         |                                                                                          |                                                     |                                                                                                      |   |
| Separate account assets:                                                  |                                |                                        |                                                                         |                                                                                          |                                                     |                                                                                                      |   |
| Mutual fund investments                                                   | -                              | -                                      | -                                                                       | -                                                                                        | -                                                   | -                                                                                                    | -  |
| Equity investments                                                        | 7                              | 11                                     | -                                                                       | 179                                                                                      | -                                                   | 197                                                                                                  | 10  |
| Fixed income investments                                                  | 313,747                        | (78)                                        | -                                                                       | (88,136)                                                                                      | (132,570)                                                | 92,963                                                                                               | (2,723) |
| Alternative investments                                                   | 259,762                        | (10,187)                                    | -                                                                       | 20,182                                                                                   | -                                                   | 269,757                                                                                              | (9,519) |
| Other investments                                                         | 725                            | -                                      | -                                                                       | -                                                                                        | (725)                                                    | -                                                                                                    | -  |
| Total separate account assets (1)                                         | $574,241                       | $(10,254)                                   | -                                                                       | (67,775)                                                                                      | (133,295)                                                | 362,917                                                                                              | (12,232) |
|                                                                      |                                |                                        |                                                                         |                                                                                          |                                                     |                                                                                                      |   |
| Total assets measured at fair value ona recurring basis              | $867,416                       | $(22,036)                                   | $           302  | $              (19,980) | $ (185,404)                                              | $   640,298                                                                           | $            (13,484) |

|   | (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. |
|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| Liabilities                                                  | Beginningbalance                    | Total realized and unrealized(gains) losses | Purchases,issuances, andsettlements (net)                                  | Transfers inand/or (out) oflevel 3    | Endingbalance                                                        | Change in total (gains)losses included in earningsrelating to instruments stillheld at the reporting date |
|--------------------------------------------------------------|-------------------------------------|---------------------------------------------|----------------------------------------------------------------------------|---------------------------------------|----------------------------------------------------------------------|-----------------------------------------------------------------------------------------------------------|
| Includedinearnings                                           | Included inothercomprehensiveincome |
|                                                         |                                |                                        |                                                                       |                                  |                                                                 |                                                                                                      |   |
| Other policy liabilities:                                    |                                |                                        |                                                                       |                                  |                                                                 |                                                                                                      |   |
| Guaranteed minimum withdrawal benefitliability               | $ 168,786                           | $ 385,563                                   | $            - | $     63,680 | $           - | $ 618,029                                                                                                 | $        480,587 |
| Guaranteed minimum accumulationbenefit liability             | 46,030                              | 180,406                                     | -                                                                          | 5,475                                 | -                                                                    | 231,911                                                                                                   | 181,178 |
| Derivatives embedded in reinsurancecontracts                 | -                                   | -                                           | -                                                                          | -                                     | -                                                                    | -                                                                                                         | - |
| Fixed index annuities                                        | 139,012                             | (21,771) )                             | -                                                                          | 1,046                                 | -                                                                    | 118,287                                                                                                   | (11,167) |
| Total other policy liabilities                               | 353,828                             | 544,198                                     | -                                                                          | 70,201                                | -                                                                    | 968,227                                                                                                   | 650,598 |
|                                                         |                                |                                        | -                                                                          |                                  |                                                                 |                                                                                                      |   |
| Derivative instruments – payable:                      |                                |                                        |                                                                       |                                  |                                                                 |                                                                                                      |   |
| Interest rate contracts                                      | -                                   | -                                           | -                                                                          | -                                     | -                                                                    | -                                                                                                         | - |
| Foreign currency contracts                                   | -                                   | -                                           | -                                                                          | -                                     | -                                                                    | -                                                                                                         | - |
| Credit contracts                                             | 34,612                              | (886)                                       | -                                                                          | -                                     | -                                                                    | 33,726                                                                                                    | (886) |
| Futures                                                      | -                                   | -                                           | -                                                                          | -                                     | -                                                                    | -                                                                                                         | - |
| Total derivative instruments – payable            | 34,612                              | (886)                                       | -                                                                          | -                                     | -                                                                    | 33,726                                                                                                    | (886) |
|                                                         |                                |                                        |                                                                       |                                  |                                                                 |                                                                                                      |   |
|                                                         |                                |                                        |                                                                       |                                  |                                                                 |                                                                                                      |   |
| Other liabilities:                                           |                                |                                        |                                                                       |                                  |                                                                 |                                                                                                      |   |
| Bank overdrafts                                              | -                                   | -                                           | -                                                                          | -                                     | -                                                                    | -                                                                                                         | - |
|                                                         |                                |                                        |                                                                       |                                  |                                                                 |                                                                                                      |   |
| Total liabilities measured at fair value on arecurring basis | $ 388,440                           | $543,312                                    | $            - | $    70,201       | $           - | $ 1,001,953                                                                                               | $          649,712 |

|                                                                                                                |   | Total realized gains(losses) included inearnings |   | Change inunrealized gains(losses) related toassets still held  atthe reporting date |
|---------------------------------------------------------------------------------------------------------------------|--------|--------------------------------------------------|--------|-----------------------------------------------------------------------------------------------|
| Net investment (loss) income                                                                                        | $      | (4,654)                                          | $      | 5,797                                                                                    |
| Net derivative loss                                                                                                 |   | (550,360)                                        |   | (656,761)                                                                                     |
| Net realized investment losses, excluding impairment    losses on available-for-sale securities |   | (80)                                             |   | -                                                                                        |
| Net loss                                                                                                            | $      | (555,094)                                        | $      | (650,964)                                                                                     |

----

| Assets              | Beginningbalance                     | Total realized and unrealized gains (losses) | Purchases,issuances, andsettlements (net) | Transfers inand/or (out) oflevel 3 (2) | Endingbalance | Change in unrealizedgains (losses) includedin earnings relating toinstruments still heldat the reporting date |
|---------------------|--------------------------------------|---------------------------------------------------|-------------------------------------------|----------------------------------------|---------------|---------------------------------------------------------------------------------------------------------------|
| Included inearnings | Included in othercomprehensiveincome |
| Available-for-sale fixed maturity securities:                            |                                                                                               |                                                                 |                                               |                                                                 |                                                           |                                                                             |                                                                             |
|--------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------|----------------------------------------------------------------------|----------------------------------------------------|----------------------------------------------------------------------|----------------------------------------------------------------|----------------------------------------------------------------------------------|----------------------------------------------------------------------------------|
| Asset-backed securities                                                  | $               -  | $          -  | $       -  | $          -  | $         -  | $            -  | $            -  |
| Collateralized mortgage obligations                                      | 2,523                                                                                         | 76                                                              | 44                                            | -                                                               | -                                                         | 2,643                                                                       | -                                                                           |
| Commercial mortgage-backed    securities             | 65                                                                                            | (14)                                                                 | 4                                             | -                                                               | -                                                         | 55                                                                          | -                                                                           |
| Foreign government & agency securities                               | -                                                                                             | -                                                               | -                                             | -                                                               | -                                                         | -                                                                           | -                                                                           |
| U.S. states and political subdivisions    securities | -                                                                                             | -                                                               | -                                             | -                                                               | -                                                         | -                                                                           | -                                                                           |
| U.S. treasury and agency securities                                      | -                                                                                             | -                                                               | -                                             | -                                                               | -                                                         | -                                                                           | -                                                                           |
| Corporate securities                                                     | 1,749                                                                                         | 119                                                             | 1,972                                         | 3,198                                                           | 2,987                                                     | 10,025                                                                      | -                                                                           |
| Total available-for-sale fixed maturity securities                       | 4,337                                                                                         | 181                                                             | 2,020                                         | 3,198                                                           | 2,987                                                     | 12,723                                                                      | -                                                                           |
|                                                                     |                                                                                               |                                                                 |                                               |                                                                 |                                                           |                                                                             |                                                                             |
| Trading fixed maturity securities:                                       |                                                                                               |                                                                 |                                               |                                                                 |                                                           |                                                                             |                                                                             |
| Asset-backed and mortgage-backed   securities             | 96,603                                                                                        | 39,850                                                          | -                                             | (1,700)                                                              | 14,412                                                    | 149,165                                                                     | 46,505                                                                      |
| Collateralized mortgage obligations                                      | 103,126                                                                                       | 6,443                                                           | -                                             | (3,266)                                                              | 34,230                                                    | 140,533                                                                     | 9,607                                                                       |
| Commercial mortgage-backed   securities                   | 177,827                                                                                       | 27,857                                                          | -                                             | (87)                                                                 | -                                                         | 205,597                                                                     | 61,187                                                                      |
| Foreign government & agency   securities              | 9,450                                                                                         | 55                                                              | -                                             | (105)                                                                | -                                                         | 9,400                                                                       | (50)                                                                             |
| U.S. states and political subdivisions   securities       | -                                                                                             | -                                                               | -                                             | -                                                               | -                                                         | -                                                                           | -                                                                           |
| U.S. treasury and agency securities                                      | -                                                                                             | -                                                               | -                                             | -                                                               | -                                                         | -                                                                           | -                                                                           |
| Corporate securities                                                     | 98,795                                                                                        | 9,719                                                           | -                                             | 8,074                                                           | 797                                                       | 117,385                                                                     | 13,581                                                                      |
| Total trading fixed maturity securities                                  | 485,801                                                                                       | 83,924                                                          | -                                             | 2,916                                                           | 49,439                                                    | 622,080                                                                     | 130,830                                                                     |
|                                                                     |                                                                                               |                                                                 |                                               |                                                                 |                                                           |                                                                             |                                                                             |
| Derivative instruments – receivable                                | 2,361                                                                                         | 619                                                             | -                                             | 119                                                             | -                                                         | 3,099                                                                       | 619                                                                         |
| Other invested assets                                                    | -                                                                                             | -                                                               | -                                             | -                                                               | -                                                         | -                                                                           | -                                                                           |
| Short-term investments                                                   |                                                                                               |                                                                 |                                               |                                                                 |                                                           |                                                                             |                                                                             |
| Cash and cash equivalents                                                | -                                                                                             | -                                                               | -                                             | -                                                               | -                                                         | -                                                                           | -                                                                           |
| Total investments and cash                                               | 492,499                                                                                       | 84,724                                                          | 2,020                                         | 6,233                                                           | 52,426                                                    | 637,902                                                                     | 131,449                                                                     |
|                                                                     |                                                                                               |                                                                 |                                               |                                                                 |                                                           |                                                                             |                                                                             |
| Other assets                                                             |                                                                                               |                                                                 |                                               |                                                                 |                                                           |                                                                             |                                                                             |
| Separate account assets (1)                                              | 558,767                                                                                       | 13,616                                                          | -                                             | 178,970                                                         | (30,427)                                                       | 720,926                                                                     | 101,168                                                                     |
|                                                                     |                                                                                               |                                                                 |                                               |                                                                 |                                                           |                                                                             |                                                                             |
| Total assets measured at fair value on arecurring basis                  | $ 1,051,266                                                                                   | $ 98,340                                                        | $ 2,020                                       | $185,203                                                        | $21,999                                                   | $1,358,828                                                                       | $232,617                                                                    |

|   | (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 June 30, 2009 are primarily attributable to changes in the observability of inputs used to price the securities. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

| Liabilities                                                                                      | Beginningbalance                    | Total realized and unrealized(gains) losses | Purchases,issuances, andsettlements (net) | Transfers inand/or (out)of level 3 | Endingbalance                          | Change inunrealized (gains)losses included inearnings relating toinstruments stillheld at thereporting date |
|--------------------------------------------------------------------------------------------------|-------------------------------------|---------------------------------------------|-------------------------------------------|------------------------------------|----------------------------------------|-------------------------------------------------------------------------------------------------------------|
| Includedin earnings                                                                              | Included inothercomprehensiveincome |
|                                                                                             |                                |                                        |                                      |                               |                                   |                                                                                                        |   |
| Other policy liabilities:                                                                        |                                |                                        |                                      |                               |                                   |                                                                                                        |   |
|   Guaranteed minimum withdrawal     benefit liability         | $ 377,589                      | $ (113,203)                                 | $     -     | $  16,103           | $     -  | $280,489                                                                                               | $   (109,487) |
|    Guaranteed minimum accumulation     benefit liability | 326,105                        | (133,626)                                   | -                                    | 5,310                         | -                                 | 197,789                                                                                                | (131,035) |
|   Derivatives embedded in reinsurancecontracts                                         | -                              | -                                      | -                                    | -                             | -                                 | -                                                                                                      | -  |
|    Fixed index annuities                                                          | 90,055                         | 8,759                                  | -                                    | 3,977                         | -                                 | 102,791                                                                                                | 10,889  |
| Total other policy liabilities                                                                   | 793,749                        | (238,070)                                   | -                                    | 25,390                        | -                                 | 581,069                                                                                                | (229,633) |
|                                                                                             |                                |                                        |                                      |                               |                                   |                                                                                                        |   |
| Derivative instruments – payable                                                           | 39,143                         | 7,053                                  | -                                    | -                             | -                                 | 46,196                                                                                                 | 7,053  |
|                                                                                             |                                |                                        |                                      |                               |                                   |                                                                                                        |   |
| Total liabilities measured at fair value on    a recurring basis             | $ 832,892                      | $ (231,017)                                 | $     -     | $   25,390     | $     -  | $627,265                                                                                               | $ (222,580) |

|                                                                                                                     |   | Total realizedgains (losses)included inearnings |   | Change inunrealized gains(losses) related toassets still held atthe reporting date |
|--------------------------------------------------------------------------------------------------------------------------|--------|-------------------------------------------------|--------|------------------------------------------------------------------------------------|
| Net investment income                                                                                                    | $      | 83,924                                     | $      | 130,830                                                                       |
| Net derivative income                                                                                                    |   | 231,636                                    |   | 223,199                                                                       |
| Net realized investment gains, excluding     impairment losses on available-for-sale securities |   | 181                                        |   | -                                                                             |
| Net gains                                                                                                                | $      | 315,741                                    | $      | 354,029                                                                       |

----

|                                                                      | 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 subdivisionssecurities                          | -                                                                                                                     | -                                                                                             | -                                                                                       | -  | -  | -  |
| 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                                                   | -                                                                                                                     | -                                                                                             | 45,553                                                                                  | (9,070) | 9,070  | (45,553) |
| Residential mortgage-backed securities                                    | -                                                                                                                     | -                                                                                             | 91,399                                                                                  | (39,082) | 39,082  | (91,399) |
| Commercial mortgage-backed securities                                     | -                                                                                                                     | -                                                                                             | 696                                                                                     | -  | -  | (696) |
| Foreign government & agency securities                                | -                                                                                                                     | -                                                                                             | -                                                                                       | -  | -  |  - |
| U.S. states and political subdivisionssecurities                          | -                                                                                                                     | -                                                                                             | -                                                                                       | -  | -  | -  |
| U.S. treasury and agency securities                                       | -                                                                                                                     | -                                                                                             | -                                                                                       | -  | -  | -  |
| Corporate securities                                                      | -                                                                                                                     | -                                                                                                  | 55,326                                                                                  | -  | -  | (55,326) |
| Total trading fixed maturity securities                                   |                                                                                                                       |                                                                                               | 192,974                                                                                 | (48,152) | 48,152  | (192,974) |
|                                                                      |                                                                                                                       |                                                                                               |                                                                                         |   |   |   |
| Derivative instruments – receivable:                                |                                                                                                                       |                                                                                               |                                                                                         |   |   |   |
| Interest rate contracts                                                   | -                                                                                                                     | -                                                                                             | -                                                                                       | -  | -  | -  |
| Foreign currency contracts                                                | -                                                                                                                     | -                                                                                             | -                                                                                       | -  | -  | -  |
| Equity contracts                                                          | -                                                                                                                     | -                                                                                             | -                                                                                       | -  | -  | -  |
| Futures                                                                   | -                                                                                                                     | -                                                                                             | -                                                                                       | -  | -  | -  |
| Total derivative instruments– receivable                            | -                                                                                                                     | -                                                                                             | -                                                                                       | -  | -  | -  |
|                                                                      |                                                                                                                       |                                                                                               |                                                                                         |   |   |   |
| Separate account assets:                                                  |                                                                                                                       |                                                                                               |                                                                                         |   |   |   |
| Mutual fund investments                                                   | -                                                                                                                     | -                                                                                             | -                                                                                       | -  | -  | -  |
| Equity investments                                                        | -                                                                                                                     | -                                                                                             | -                                                                                       | -  | -  | -  |
| Fixed income investments                                                  | -                                                                                                                     | -                                                                                             | 109,320                                                                                 | -  | -  | (109,320) |
| Alternative investments                                                   | -                                                                                                                     | -                                                                                             | 2,969                                                                                   | -  | -  | (2,969) |
| Other investments                                                         | 4,108                                                                                                                 | -                                                                                             | -                                                                                       | -  | -  | (4,108) |
| Total separate account assets                                             | 4,108                                                                                                                 | -                                                                                             | 112,289                                                                                 | -  | -  | (116,397) |
|                                                                      |                                                                                                                       |                                                                                               |                                                                                         |   |   |   |
| Total assets measured at fair value on arecurring basis                   | $            4,108                                        | $              -        | $     312,447                                                  | $          (48,152) | $       48,152  | $       (316,555) |

----

|                                                    | 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 subdivisionssecurities        | -                                                                                             | -                                                                                                   | -                                                                                 | -  | -  |   -  |
| U.S. treasury and agency securities                     | -                                                                                             | -                                                                                                   | -                                                                                 | -  | -  |   -  |
| Corporate securities                                    | -                                                                                             | -                                                                                                   | 254                                                                               | -  | -  | (254) |
| Total available-for-sale fixed maturitysecurities       | -                                                                                             | -                                                                                                   | 254                                                                               | - | -  | (254) |
|                                                    |                                                                                               |                                                                                                     |                                                                                   |   |   |   |
| Trading fixed maturity securities:                      |                                                                                               |                                                                                                     |                                                                                   |   |   |   |
| Asset-backed securities                                 | -                                                                                             | -                                                                                                   | 7,908                                                                             | (6,144) | 6,144  | (7,908) |
| Residential mortgage-backed securities                  | -                                                                                             | -                                                                                                   | 57,646                                                                            | (53,210) | 53,210  | (57,646) |
| Commercial mortgage-backed securities                   | -                                                                                             | -                                                                                                   | -                                                                                 | -  | -  | -  |
| Foreign government & agency securities              | -                                                                                             | -                                                                                                   | -                                                                                 | -  | -  | -  |
| U.S. states and political subdivisionssecurities        | -                                                                                             | -                                                                                                   | -                                                                                 | -  | -  | -  |
| U.S. treasury and agency securities                     | -                                                                                             | -                                                                                                   | -                                                                                 | -  | -  | -  |
| Corporate securities                                    | -                                                                                             | -                                                                                                   | 45,655                                                                            | -  | -  | (45,655) |
| Total trading fixed maturity securities                 | -                                                                                             | -                                                                                                   | 111,209                                                                           | (59,354) | 59,354  | (111,209) |
|                                                    |                                                                                               |                                                                                                     |                                                                                   |   |   |   |
| Derivative instruments – receivable:              |                                                                                               |                                                                                                     |                                                                                   |   |   |   |
| Interest rate contracts                                 | -                                                                                             | -                                                                                                   | -                                                                                 | -  | -  | -  |
| Foreign currency contracts                              | -                                                                                             | -                                                                                                   | -                                                                                 | -  | -  | -  |
| Equity contracts                                        | -                                                                                             | -                                                                                                   | -                                                                                 | -  | -  | -  |
| Futures                                                 | -                                                                                             | -                                                                                                   | -                                                                                 | -  | -  | -  |
| Total derivative instruments– receivable          | -                                                                                             | -                                                                                                   | -                                                                                 | -  | -  | -  |
|                                                    |                                                                                               |                                                                                                     |                                                                                   |   |   |   |
| Separate account assets:                                |                                                                                               |                                                                                                     |                                                                                   |   |   |   |
| Mutual fund investments                                 | -                                                                                             | -                                                                                                   | -                                                                                 | -  | -  | -  |
| Equity investments                                      | -                                                                                             | -                                                                                                   | -                                                                                 | -  | -  | -  |
| Fixed income investments                                | -                                                                                             | -                                                                                                   | 132,570                                                                           | -  | -  | (132,570) |
| Alternative investments                                 | -                                                                                             | -                                                                                                   | -                                                                                 | -  | -  | -  |
| Other investments                                       | 725                                                                                           | -                                                                                                   | -                                                                                 | -  | -  | (725) |
| Total separate account assets                           | 725                                                                                           | -                                                                                                   | 132,570                                                                           | -  | -  | (133,295) |
|                                                    |                                                                                               |                                                                                                     |                                                                                   |   |   |   |
| Total assets measured at fair value on arecurring basis | $            725                  | $              -              | $     244,033                                            | $          (59,354) | $                59,354  | $       (244,758) |

----

|                   |                                                     |                                                                   | June 30, 2010                                                    |       | December 31, 2009                                                |
|------------------------|----------------------------------------------------------|------------------------------------------------------------------------|------------------------------------------------------------------|------------|------------------------------------------------------------------|
|                   |                                                     |                                                                   | Carrying                                                         | Estimated  |                                                             | Carrying | Estimated |
|                   |                                                     |                                                                   | Amount                                                           | Fair Value |                                                             | Amount | Fair Value |
| Financial assets:      |                                                     |                                                                   |                                                             |       |                                                             |
|                   | Mortgage loans                                           |  $        1,844,572  |   $      1,760,625  |       | $        1,911,961  | $       1,937,199  |
|                   | Policy loans                                             | 713,834                                                           | 874,430                                                     |       | 722,590                                                     | 837,029  |
|                   |                                                     |                                                                   |                                                             |       |                                                             |   |
| Financial liabilities: |                                                     |                                                                   |                                                             |       |                                                             |
|                   | Contractholder deposit funds and otherpolicy liabilities | 13,907,754                                                        | 13,748,239                                                  |       | 14,104,892                                                  | 13,745,774  |
|                   | Debt payable to affiliates                               | 883,000                                                           | 883,000                                                     |       | 883,000                                                     | 883,000  |

----

|                                               |                                                                         |                                                            | Gross                                                                               |                                                                             |                                                                         |
|----------------------------------------------------|------------------------------------------------------------------------------|-----------------------------------------------------------------|-------------------------------------------------------------------------------------|----------------------------------------------------------------------------------|------------------------------------------------------------------------------|
| Available-for-sale fixed maturity securities       | AmortizedCost                                                                | GrossUnrealizedGains                                            | UnrealizedTemporaryLosses                                                           | OTTILosses(1)                                                                    | FairValue                                                                    |
| Non-corporate securities:                          |                                                                         |                                                            |                                                                                |                                                                             |                                                                         |
| Asset-backed securities                            | $           884  | $         44  | $             (12) | $            -  | $            916 |
| Residential mortgage-backed securities             | 38,625                                                                  | 2,887                                                      | (1)                                                                                 | -                                                                           | 41,511                                                                  |
| Commercial mortgage-backed securities              | 16,237                                                                  | 521                                                        | (2,594)                                                                             | -                                                                           | 14,164                                                                  |
| Foreign government & agency securities         | 507                                                                     | 48                                                         | -                                                                              | -                                                                           | 555                                                                     |
| U.S. states and political subdivisions securities  | 218                                                                     | 2                                                          | -                                                                              | -                                                                           | 220                                                                     |
| U.S. treasury and agency securities                | 366,749                                                                 | 5,914                                                      | -                                                                              |                                                                             | 372,663                                                                 |
| Total non-corporate securities                     | 423,220                                                                      | 9,416                                                      | (2,607)                                                                             | -                                                                           | 430,029                                                                 |
|                                               |                                                                         |                                                            |                                                                                |                                                                             |                                                                         |
| Corporate securities                               | 1,031,383                                                               | 100,335                                                    | (13,205)                                                                            | (13,189)                                                                         | 1,105,324                                                               |
|                                               |                                                                         |                                                            |                                                                                |                                                                             |                                                                         |
| Total available-for-sale fixed maturity securities | $ 1,454,603                                                             | $109,751                                                   | $      (15,812)                                       | $ (13,189)                                                                       | $  1,535,353                                                  |
|                                               |                                                                         |                                                            |                                                                                |                                                                             |                                                                         |
|                                               |                                                                         |                                                            |                                                                                |                                                                             |                                                                         |
| Trading fixed maturity securities                  | AmortizedCost                                                                | GrossUnrealizedGains                                            | GrossUnrealizedLosses                                                               | FairValue                                                                        |                                                                         |
| Non-corporate securities:                          |                                                                         |                                                            |                                                                                |                                                                             |                                                                         |
| Asset-backed securities                            | $     564,687                                  | $     7,295                       | $     (168,542)                                            | $    403,440                                            |                                                                         |
| Residential mortgage-backed securities             | 1,383,018                                                               | 19,386                                                     | (361,117)                                                                           | 1,041,287                                                                   |                                                                         |
| Commercial mortgage-backed securities              | 961,108                                                                 | 31,319                                                     | (238,074)                                                                           | 754,353                                                                     |                                                                         |
| Foreign government & agency securities         | 124,158                                                                 | 10,425                                                     | -                                                                              | 134,583                                                                     |                                                                         |
| U.S. states and political subdivisions securities  | 606                                                                     | 23                                                         | -                                                                              | 629                                                                         |                                                                         |
| U.S. treasury and agency securities                | 845,094                                                                 | 5,491                                                      | -                                                                              | 850,585                                                                     |                                                                         |
| Total non-corporate securities                     | 3,878,671                                                               | 73,939                                                     | (767,733)                                                                           | 3,184,877                                                                   |                                                                         |
|                                               |                                                                         |                                                            |                                                                                |                                                                             |                                                                         |
| Corporate securities                               | 8,649,882                                                               | 419,573                                                    | (185,358)                                                                           | 8,884,097                                                                   |                                                                         |
|                                               |                                                                         |                                                            |                                                                                |                                                                             |                                                                         |
| Total trading fixed maturity securities            | $ 12,528,553                                                            | $ 493,512                                                  | $     (953,091)                                            | $12,068,974                                                                 |                                                                         |

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

----

|                                               |                                                                         |                                                                                    | Gross                                                                         |                                                                                   |                                                                                     |
|----------------------------------------------------|------------------------------------------------------------------------------|-----------------------------------------------------------------------------------------|-------------------------------------------------------------------------------|----------------------------------------------------------------------------------------|------------------------------------------------------------------------------------------|
|  Available-for-sale fixed maturity securities | AmortizedCost                                                                | GrossUnrealizedGains                                                                    | UnrealizedTemporaryLosses                                                     | OTTILosses (1)                                                                         | FairValue                                                                                |
| Non-corporate securities:                          |                                                                         |                                                                                    |                                                                          |                                                                                   |                                                                                     |
| Asset-backed securities                            | $           966  | $             42  | $            (19) | $             -  | $             989  |
| Residential mortgage-backed securities             | 45,531                                                                  | 2,170                                                                              | -                                                                        | -                                                                                 | 47,701                                                                              |
| Commercial mortgage-backed securities              | 18,566                                                                  | 114                                                                                | (2,600)                                                                       | -                                                                                 | 16,080                                                                              |
| Foreign government & agency securities         | 728                                                                     | 39                                                                                 | (7)                                                                           | -                                                                                 | 760                                                                                 |
| U.S. treasury and agency securities                | 38,063                                                                  | 1,156                                                                              | (88)                                                                          | -                                                                                 | 39,131                                                                              |
| Total non-corporate securities                     | 103,854                                                                 | 3,521                                                                              | (2,714)                                                                       | -                                                                                 | 104,661                                                                             |
|                                               |                                                                         |                                                                                    |                                                                          |                                                                                   |                                                                                     |
| Corporate securities                               | 1,017,570                                                               | 86,026                                                                             | (18,993)                                                                      | (13,748)                                                                               | 1,070,855                                                                           |
|                                               |                                                                         |                                                                                    |                                                                          |                                                                                   |                                                                                     |
| Total available-for-sale fixed maturity securities | $ 1,121,424                                                             | $      89,547                                        | $     (21,707)                                       | $  (13,748)                                                                  | $   1,175,516                                                        |
|                                               |                                                                         |                                                                                    |                                                                          |                                                                                   |                                                                                     |
|                                               |                                                                         |                                                                                    |                                                                          |                                                                                   |                                                                                     |
| Trading fixed maturity securities                  | AmortizedCost                                                                | GrossUnrealizedGains                                                                    | GrossUnrealizedLosses                                                         | FairValue                                                                              |                                                                                     |
| Non-corporate securities:                          |                                                                         |                                                                                    |                                                                          |                                                                                   |                                                                                     |
| Asset-backed securities                            | $      658,864                            | $       6,766                                   | $   (198,367)                                                  | $   467,263                                                             |                                                                                     |
| Collateralized mortgage obligations                | -                                                                       | -                                                                                  | -                                                                        | -                                                                                      |                                                                                     |
| Residential mortgage-backed securities             | 1,437,147                                                               | 13,051                                                                             | (409,307)                                                                     | 1,040,891                                                                              |                                                                                     |
| Commercial mortgage-backed securities              | 972,971                                                                 | 23,199                                                                             | (357,241)                                                                     | 638,929                                                                                |                                                                                     |
| Foreign government & agency securities         | 76,971                                                                  | 6,277                                                                              | -                                                                        | 83,248                                                                                 |                                                                                     |
| U.S. treasury and agency securities                | 525,758                                                                 | 14,122                                                                             | (2,350)                                                                       | 537,530                                                                                |                                                                                     |
| Total non-corporate securities                     | 3,671,711                                                                    | 63,415                                                                             | (967,265)                                                                     | 2,767,861                                                                              |                                                                                     |
|                                               |                                                                         |                                                                                    |                                                                          |                                                                                   |                                                                                     |
| Corporate securities                               | 8,371,250                                                                    | 300,777                                                                            | (309,366)                                                                     | 8,362,661                                                                              |                                                                                     |
|                                               |                                                                         |                                                                                    |                                                                          |                                                                                   |                                                                                     |
| Total trading fixed maturity securities            | $  12,042,961                                                      | $   364,192                                                         | $(1,276,631)                                                                  | $11,130,522                                                                            |                                                                                     |

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

----

|                                                                                                                                       |                                                    |                                        |                                                                | Amortized Cost | Fair Value    |
|--------------------------------------------------------------------------------------------------------------------------------------------|---------------------------------------------------------|---------------------------------------------|---------------------------------------------------------------------|----------------|---------------|
| Maturities of available-for-sale fixed securities:                                                                                         |                                                    |                                        |
|                                                                                                                                       | Due in one year or less                                 | $     10,418  | $         10,545  |
|                                                                                                                                       | Due after one year through five years                   | 708,653                                | 769,137                                                        |
|                                                                                                                                       | Due after five years through ten years                  | 86,699                                 | 97,159                                                         |
|                                                                                                                                       | Due after ten years                                     |                                        |                                                                | 593,087   | 601,922  |
|             Subtotal – Maturities of available-for-sale fixed securities |                                                    | 1,398,857                              | 1,478,763                                                      |
| ABS, RMBS and CMBS securities(1)                                                                                                           |                                                    | 55,746                                 | 56,590                                                         |
|           Total available-for-sale fixed securities                                      |                                                    | $    1,454,603     | $    1,535,353                             |
|                                                                                                                                       |                                                    |                                        |                                                                |
| Maturities of trading fixed securities:                                                                                                    |                                                    |                                        |
|                                                                                                                                       | Due in one year or less                                 | $    1,458,931     | $      1,472,028                 |
|                                                                                                                                       | Due after one year through five years                   | 4,506,225                              | 4,660,436                                                      |
|                                                                                                                                       | Due after five years through ten years                  | 2,288,341                              | 2,410,246                                                      |
|                                                                                                                                       | Due after ten years                                     | 1,366,243                              | 1,327,185                                                           |
|                                                                                                                                       | Subtotal – Maturities of trading fixed securities | 9,619,740                              | 9,869,895                                                      |
| ABS, RMBS and CMBS securities(1)                                                                                                           | 2,908,813                                          | 2,199,079                              |
|                                                                                                                                       | Total trading fixed securities                          | $  12,528,553                | $    12,068,974                            |

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

----

|                                       |  Less Than Twelve Months                                        |  Twelve Months Or More                                    |  Total                                                     |
|--------------------------------------------|----------------------------------------------------------------------|----------------------------------------------------------------|-----------------------------------------------------------------|
|                                       |                                                                 |                                                           |                                                            |   |   |   |
|                                       | FairValue                                                            | GrossUnrealizedLosses                                          | FairValue                                                       | GrossUnrealizedLosses | FairValue | GrossUnrealizedLosses |
|                                       |                                                                 |                                                           |                                                            |   |   |   |
| Non-corporate securities:                  |                                                                 |                                                           |                                                            |   |   |   |
| Asset-backed securities                    | $          -  | $         -  | $          22 | $      (12) | $        22  | $       (12) |
| Residential mortgage-backed securities     | 195                                                             | (1)                                                            | -                                                          | -  | 195  | (1) |
| Commercial mortgage-backed securities      | -                                                               | -                                                         | 4,287                                                      | (2,594) | 4,287  | (2,594) |
| Foreign government & agency securities | -                                                               | -                                                         | -                                                          | -  | -  | -  |
| U.S. states and political subdivisions     | -                                                               | -                                                         | -                                                          | -  | -  | -  |
| U.S. treasury and agency securities        | -                                                               | -                                                         | -                                                          | -  | -  | -  |
| Total non-corporate securities             | 195                                                             | (1)                                                       | 4,309                                                      | (2,606) | 4,504  | (2,607) |
|                                       |                                                                 |                                                           |                                                            |   |   |   |
| Corporate securities                       | 64,350                                                          | (1,849)                                                        | 154,727                                                    | (24,545) | 219,077  | (26,394) |
|                                       |                                                                 |                                                           |                                                            |   |   |   |
|  Total                                | $ 64,545                                                        | $(1,850)                                                       | $ 159,036                                                  | $ (27,151) | $223,581  | $(29,001) |

|                                       |  Less Than Twelve Months                                                                |  Twelve Months Or More                                                                  |  Total                                                                 |
|--------------------------------------------|----------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------|-----------------------------------------------------------------------------|
|                                       |                                                                                         |                                                                                         |                                                                        |   |   |   |
|                                       |  FairValue                                                                              | GrossUnrealizedLosses                                                                        |  FairValue                                                             | GrossUnrealizedLosses |  FairValue | GrossUnrealizedLosses |
|                                       |                                                                                         |                                                                                         |                                                                        |   |   |   |
| Non-corporate securities:                  |                                                                                         |                                                                                         |                                                                        |   |   |   |
| Asset-backed securities                    | $              -  | $              -  | $            37 | $           (19) | $          37  | $          (19) |
| Commercial mortgage-backed securities      | 499                                                                                     | (1)                                                                                          | 6,597                                                                  | (2,599) | 7,096  | (2,600) |
| Foreign government & agency securities | -                                                                                       | -                                                                                       | 212                                                                    | (7) | 212  | (7) |
| U.S. treasury and agency securities        | 16,942                                                                                  | (88)                                                                                         | -                                                                      | -  | 16,942  | (88) |
| Total non-corporate securities             | 17,441                                                                                  | (89)                                                                                         | 6,846                                                                  | (2,625) | 24,287  | (2,714) |
|                                       |                                                                                         |                                                                                         |                                                                        |   |   |   |
| Corporate securities                       | 83,967                                                                                  | (6,208)                                                                                      | 183,430                                                                | (26,533) | 267,397  | (32,741) |
|                                       |                                                                                         |                                                                                         |                                                                        |   |   |   |
| Total                                      | $   101,408                                                              | $     (6,297)                                                       | $  190,276                                                   | $    (29,158) | $ 291,684  | $   (35,455) |

----

----

----

|                                                                                             |   | Six-month Period Ended June 30, 2010 |
|--------------------------------------------------------------------------------------------------|--------|--------------------------------------|
|                                                                                             |   |                                 |
| Beginning balance, at January 1, 2010                                                            | $      | 9,148                           |
| Add: Credit losses remaining in accumulated deficit relatedto the adoption of FASB ASC Topic 320 |   | -                               |
| Add: Credit losses on OTTI not previously recognized                                             |   | 885                             |
| Less: Credit losses on securities sold                                                           |   | (1,699)                              |
| Less: Credit losses on securities impaired due to intent to sell                                 |   | -                               |
| Add: Credit losses on previously impaired securities                                             |   | -                               |
| Less: Increases in cash flows expected on previouslyimpaired securities                          |   | (1,276)                              |
| Ending balance, at June 30, 2010                                                                 | $      | 7,058                           |

|                                                                                             |   | Three-month Period Ended June 30, 2009 |
|--------------------------------------------------------------------------------------------------|--------|----------------------------------------|
|                                                                                             |   |                                   |
| Beginning balance, at April 1, 2009                                                              | $      | -                                 |
| Add: Credit losses remaining in accumulated deficit relatedto the adoption of FASB ASC Topic 320 |   | 27,805                            |
| Add: Credit losses on OTTI not previously recognized                                             |   | 4,834                             |
| Less: Credit losses on securities sold                                                           |   | -                                 |
| Less: Credit losses on securities impaired due to intent to sell                                 |   | -                                 |
| Add: Credit losses on previously impaired securities                                             |   | -                                 |
| Less: Increases in cash flows expected on previouslyimpaired securities                          |   | (127)                                  |
| Ending balance, at June 30, 2009                                                                 | $      | 32,512                            |

----

----

----

----

|                 | At June 30, 2010 | At December 31, 2009 |
|----------------------|------------------|----------------------|
|                 |             | Number of            |   | PrincipalNotional |   | Number of |   | PrincipalNotional |
|                 |             | Contracts            |   | Contracts |   | Contracts |   | Contracts |
|                 |             |                 |   |   |   |   |   |   |
| Interest rate swaps  |             | 79              |   | $    8,063,000  |   | 102  |   |  $      8,883,000  |
| Currency swaps       |             | 13              |   | 355,419  |   | 10  |   | 351,740  |
| Credit default swaps |             | 1               |   | 55,000  |   | 1  |   |         55,000  |
| Equity swaps         |             | -               |   | -  |   | 2  |   | 4,908  |
| Swaptions            |             | 1               |   | 350,000  |   | 5  |   | 1,150,000 |
| Futures (1)          |             | (22,999)             |   | 3,060,425  |   | (13,811) |   | 2,378,216  |
| Index call options   |             | 7,536           |   | 1,471,410  |   | 7,345  |   | 1,313,381  |
| Index put options    |             | 2,600           |   | 254,523  |   | 7,100  |   | 682,499  |
| Total                |             |                 |   | $   13,609,777  |   |   |   | $    14,818,744  |

----

|                         | At June 30, 2010                          | At December 31, 2009                                                       |
|------------------------------|-------------------------------------------|----------------------------------------------------------------------------|
|                         |     Asset Derivatives |     Liability     Derivatives |     Asset Derivatives |                   Liability                    Derivatives |
|                         |                                      | Fair Value (a)                                                             |   | Fair Value (a) |   | Fair Value (a) |   | Fair Value (a) |
|                         |                                      |                                                                       |   |   |   |   |   |   |
| Interest rate contracts      |                                      | $   206,101                                            |   | $   560,939  |   | $   130,178  |   | $   532,401  |
| Foreign currency contracts   |                                      | 29,511                                                                |   | 5,690  |   | 56,032  |   | 905  |
| Equity contracts             |                                      | 33,653                                                                |   | -  |   | 58,692  |   | -  |
| Credit contracts             |                                      | -                                                                     |   | 33,726  |   | -  |   | 34,349  |
| Futures (b)                  |                                      | 17,105                                                                |   | 2,435  |   | 14,325  |   | 5,255  |
| Total derivative instruments |                                      | 286,370                                                               |   | 602,790  |   | 259,227  |   | 572,910  |
| Embedded derivatives (c)     |                                      | -                                                                     |   | 1,019,282  |   | 11,308  |   | 417,764  |
| Total                        |                                      | $   286,370                                            |   | $   1,622,072  |   | $   270,535  |   | $   990,674  |

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

| (b)   | Futures include both interest rate and equity price risks. |
|-----------------|------------------------------------------------------------|

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

|                                                   |   | For the six-month periodsended June 30,                                                                                    |   | For the three-month periodsended June 30, |
|--------------------------------------------------------|--------|----------------------------------------------------------------------------------------------------------------------------|--------|-------------------------------------------|
|                                                   |   | 2010                                                                                                                       |   | 2009                                      |   | 2010 |   | 2009 |
|                                                   |   |                                                                                                                       |   |                                      |   |   |   |   |
| Interest rate contracts                                |   | $        (78,669)                                                                  |   | $   172,834           |   | $        (36,225) |   | $   104,868  |
| Foreign currency contracts                             |   | (5,425)                                                                                                                    |   | (2,209)                                   |   | (1,966) |   | (6,871) |
| Equity contracts                                       |   | (14,012)                                                                                                                   |   | (41,488)                                  |   | (8,783) |   | (49,194) |
| Credit contracts                                       |   | 623                                                                                                                   |   | (4,130)                                   |   | 886  |   | (7,053) |
| Futures                                                |   | 140,402                                                                                                               |   | (103,895)                                 |   | 212,177  |   | (142,145) |
| Embedded derivatives                                   |   | (610,084)                                                                                                                  |   | 142,540                              |   | (691,804) |   | 134,201  |
| Net derivative (loss) income fromcontinuing operations |   | $      (567,165)                                                                             |   | $   163,652           |   | $      (525,715) |   | $     33,806  |
| Net derivative income fromdiscontinued operations      |   | $                   -  |   | $   137,938           |   | $                   -  |   | $   124,485  |

----

----

|                                                                 | June 30, |      | December 31, |
|----------------------------------------------------------------------|----------|-----------|--------------|
|                                                                 | 2010     |      | 2009         |
| AssetsReinsurance receivable                                         | $        | 1,520,894 |         | $ | 1,540,697 |
|                                                                 |     |      |         |   |   |
| LiabilitiesContractholder deposit funds and other policy liabilities |     | 1,496,944 |         |   | 1,493,145 |
| Future contract and policy benefits                                  |     | 2,104     |         |   | 2,104 |
| Reinsurance payable                                                  |     | 1,565,278 |         |   | 1,603,711 |

----

|                                                                 | June 30, |    | December 31, |
|----------------------------------------------------------------------|----------|---------|--------------|
|                                                                 | 2010     |    | 2009         |
| AssetsReinsurance receivable                                         | $        | 413,221 |         | $ | 422,486 |
|                                                                 |     |    |         |   |   |
| LiabilitiesContractholder deposit funds and other policy liabilities |     | 462,279 |         |   | 466,899 |
| Reinsurance payable                                                  |     | 428,738 |         |   | 430,528 |
|                                                                 |     |    |         |   |   |

----

|                                                                 | June 30, |          | December 31, |
|----------------------------------------------------------------------|----------|---------------|--------------|
|                                                                 | 2010     |          | 2009         |
| AssetsReinsurance receivable                                         | $        | 121,772  |         | $ | 103,802  |
|                                                                 |     |          |         |   |   |
| LiabilitiesContractholder deposit funds and other policy liabilities |     | 105,721  |         |   | 84,606  |
| Future contract and policy benefits                                  |     | 13,582   |         |   | 10,518  |
| Reinsurance payable                                                  |     | 198,771  |         |   | 182,000  |

----

----

----

| Benefit Type                                                                | Account Balance                                                                                          | Net Amount at Risk 1                                                                               | Average    Attained Age |
|-----------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------------|---------------------------------------------------------------------------------------------------------|---------------------------------------------|
| Minimum death                                                               | $           17,147,816                            | $           2,877,440                            | 66.6                                        |
| Minimum income                                                              | $                171,714 | $                88,837 |   61.8                            |
| Minimum accumulation or       withdrawal | $             9,827,580                 | $              482,953            | 63.6                                        |

|  Benefit Type                |  Account Balance                                                                                    | Net Amountat Risk 1                                                                                     | Average Attained Age |
|-----------------------------------|----------------------------------------------------------------------------------------------------------|---------------------------------------------------------------------------------------------------------|----------------------|
| Minimum death                     | $           16,947,362                            | $           2,459,360                            | 66.2                 |
| Minimum income                    | $                194,780 | $                84,591 | 61.5                 |
| Minimum accumulation orwithdrawal | $             8,866,525                 | $              212,371            | 63.0                 |

|                                     | GuaranteedMinimumDeath Benefit                                                              |   | GuaranteedMinimumIncome Benefit                                                       |   | Total                                              |
|------------------------------------------|---------------------------------------------------------------------------------------------|--------|---------------------------------------------------------------------------------------|--------|----------------------------------------------------|
| Balance at December 31, 2009             | $             96,267  |   | $           10,058        |   | $      106,325  |
|                                     |                                                                                        |   |                                                                                  |   |                                               |
| Benefit ratio change /Assumption changes |  15,471                                                                           |   | 2,651                                                                            |   | 18,122                                        |
| Incurred guaranteed benefits             | 4,536                                                                                  |   | 755                                                                              |   |    5,291                       |
| Paid guaranteed benefits                 |  (16,678)                                                                              |   |  (1,997)                                                                         |   |   (18,675)                               |
| Interest                                 | 13,687                                                                                 |   |   336                                                                  |   |   14,023                            |
|                                     |                                                                                        |   |                                                                                  |   |                                               |
| Balance at June 30, 2010                 | $           113,283             |   | $            11,803  |   | $      125,086  |

----

|                                     | GuaranteedMinimumDeath Benefit                                                                           |   | GuaranteedMinimumIncome Benefit                                           |   |   Total                                                          |
|------------------------------------------|----------------------------------------------------------------------------------------------------------|--------|---------------------------------------------------------------------------|--------|----------------------------------------------------------------------------|
| Balance at December 31, 2008             | $              201,648        |   | $          18,773  |   | $          220,421  |
|                                     |                                                                                                     |   |                                                                      |   |                                                                       |
| Benefit ratio change /Assumption changes | (13,051)                                                                                                 |   | (634)                                                                     |   | (13,685)                                                                   |
| Incurred guaranteed benefits             | 22,778                                                                                              |   | 1,703                                                                |   | 24,481                                                                |
| Paid guaranteed benefits                 | (64,957)                                                                                                 |   | (2,366)                                                                   |   | (67,323)                                                                   |
| Interest                                 | 6,820                                                                                               |   | 767                                                                  |   | 7,587                                                                 |
|                                     |                                                                                                     |   |                                                                      |   |                                                                       |
| Balance at June 30, 2009                 | $               153,238  |   | $          18,243  |   | $          171,481       |

----

----

|                                                                                                | SLUSas Parent |                  | SLNY   |   | OtherSubs     |   | Elimination |        | ConsolidatedCompany |
|-----------------------------------------------------------------------------------------------------|---------------|-----------------------|--------|--------|---------------|--------|-------------|-------------|---------------------|
|                                                                                                |          |                  |   |   |          |   |        |        |                |   |   |   |   |   |
| Revenues                                                                                            |          |                  |   |   |          |   |        |        |                |   |   |   |   |   |
|                                                                                                |          |                  |   |   |          |   |        |        |                |   |   |   |   |   |
| Premiums and annuity considerations                                                                 | $             | 8,307            |   | $      | 59,935   |   | $           | -      |                | $ | -  |   | $ | 68,242  |
| Net investment income (1)                                                                           |          | 771,636          |   |   | 78,304   |   |        | 1,507  |                |   | -  |   |   | 851,447  |
| Net derivative loss                                                                                 |          | (520,184)             |   |   | (46,981)      |   |        | -      |                |   | -  |   |   | (567,165) |
| Net realized investment gains (losses), excludingimpairment losses on available-for-sale securities |          | 16,382           |   |   | 600      |   |        | (643)       |                |   | -  |   |   | 16,339  |
| Other-than-temporary impairment losses                                                              |          | (735)                 |   |   | (150)         |   |        | -      |                |   | -  |   |   | (885) |
| Fee and other income                                                                                |          | 218,342          |   |   | 13,499   |   |        | 4,387  |                |   | -  |   |   | 236,228  |
|                                                                                                |          |                  |   |   |          |   |        |        |                |   |   |   |   |   |
| Total revenues                                                                                      |          | 493,748          |   |   | 105,207  |   |        | 5,251  |                |   | -  |   |   | 604,206  |
|                                                                                                |          |                  |   |   |          |   |        |        |                |   |   |   |   |   |
| Benefits and Expenses                                                                               |          |                  |   |   |          |   |        |        |                |   |   |   |   |   |
|                                                                                                |          |                  |   |   |          |   |        |        |                |   |   |   |   |   |
| Interest credited                                                                                   |          | 151,353          |   |   | 25,011   |   |        | 447    |                |   | -  |   |   | 176,811  |
| Interest expense                                                                                    |          | 26,495           |   |   | (43)          |   |        | -      |                |   | -  |   |   | 26,452  |
| Policyowner benefits                                                                                |          | 71,083           |   |   | 45,374   |   |        | 120    |                |   | -  |   |   | 116,577  |
| Amortization of DAC, VOBA and VOCRA                                                                 |          |  (294,707)  |   |   | 41,475   |   |        | -      |                |   | -  |   |   | (253,232) |
| Other operating expenses                                                                            |          | 136,147          |   |   | 19,509   |   |        | 4,137  |                |   | -  |   |   | 159,793  |
|                                                                                                |          |                  |   |   |          |   |        |        |                |   |   |   |   |   |
| Total benefits and expenses                                                                         |          | 90,371           |   |   | 131,326  |   |        | 4,704  |                |   | -  |   |   | 226,401 |
|                                                                                                |          |                  |   |   |          |   |        |        |                |   |   |   |   |   |
| Income (loss) before income tax expense (benefit)                                                   |          | 403,377          |   |   | (26,119)      |   |        | 547    |                |   | -  |   |   | 377,805  |
|                                                                                                |          |                  |   |   |          |   |        |        |                |   |   |   |   |   |
| Income tax expense (benefit)                                                                        |          | 130,618          |   |   | (9,411)       |   |        | 147    |                |   | -  |   |   | 121,354  |
| Equity in the net loss of subsidiaries                                                              |          | (16,308)              |   |   | -        |   |        | -      |                |   | 16,308  |   |   | -  |
|                                                                                                |          |                  |   |   |          |   |        |        |                |   |   |   |   |   |
| Net income (loss)                                                                                   | $             | 256,451               |   | $      | (16,708)      |   | $           | 400    |                | $ | 16,308  |   | $ | 256,451  |

----

|                                                                                                                       | SLUSas Parent |            | SLNY   |   | OtherSubs     |   | Elimination |        | ConsolidatedCompany |
|----------------------------------------------------------------------------------------------------------------------------|---------------|-----------------|--------|--------|---------------|--------|-------------|-------------|---------------------|
|                                                                                                                       |          |            |   |   |          |   |        |        |                |   |   |   |   |   |
| Revenues                                                                                                                   |          |            |   |   |          |   |        |        |                |   |   |   |   |   |
|                                                                                                                       |          |            |   |   |          |   |        |        |                |   |   |   |   |   |
| Premiums and annuity considerations                                                                                        | $             | 4,946      |   | $      | 60,549   |   | $           | -      |                | $ | -  |   | $ | 65,495  |
| Net investment income (1)                                                                                                  |          | 1,092,664  |   |   | 121,827  |   |        | 2,452  |                |   | -  |   |   | 1,216,943  |
| Net derivative income                                                                                                      |          | 152,789    |   |   | 10,863   |   |        | -      |                |   | -  |   |   | 163,652  |
| Net realized investment (losses) gains, excluding  impairment losses on available-for-sale  securities |          | (2,392)         |   |   | 44       |   |        | (489)       |                |   | -  |   |   | (2,837) |
| Other-than-temporary impairment losses                                                                                     |          | (4,450)         |   |   | (181)         |   |        | (203)       |                |   | -  |   |   | (4,834) |
| Fee and other income                                                                                                       |          | 160,966    |   |   | 3,405    |   |        | 2,297  |                |   | -  |   |   | 166,668  |
|                                                                                                                       |          |            |   |   |          |   |        |        |                |   |   |   |   |   |
| Total revenues                                                                                                             |          | 1,404,523  |   |   | 196,507  |   |        | 4,057  |                |   | -  |   |   | 1,605,087  |
|                                                                                                                       |          |            |   |   |          |   |        |        |                |   |   |   |   |   |
| Benefits and Expenses                                                                                                      |          |            |   |   |          |   |        |        |                |   |   |   |   |   |
|                                                                                                                       |          |            |   |   |          |   |        |        |                |   |   |   |   |   |
| Interest credited                                                                                                          |          | 198,014    |   |   | 26,164   |   |        | 980    |                |   | -  |   |   | 225,158  |
| Interest expense                                                                                                           |          | 24,937     |   |   | 801      |   |        | -      |                |   | -  |   |   | 25,738  |
| Policyowner benefits                                                                                                       |          | 49,909     |   |   | 38,712   |   |        | 1,415  |                |   | -  |   |   | 90,036  |
| Amortization of DAC, VOBA and VOCRA                                                                                        |          | 378,340    |   |   | 23,480   |   |        | -      |                |   | -  |   |   | 401,820  |
| Other operating expenses                                                                                                   |          | 74,089     |   |   | 17,962   |   |        | 1,693  |                |   | -  |   |   | 93,744  |
|                                                                                                                       |          |            |   |   |          |   |        |        |                |   |   |   |   |   |
| Total benefits and expenses                                                                                                |          | 725,289    |   |   | 107,119  |   |        | 4,088  |                |   | -  |   |   | 836,496  |
|                                                                                                                       |          |            |   |   |          |   |        |        |                |   |   |   |   |   |
| Income (loss) from continuing operations before    income tax expense                                  |          | 679,234    |   |   | 89,388   |   |        | (31)        |                |   | -  |   |   | 768,591  |
|                                                                                                                       |          |            |   |   |          |   |        |        |                |   |   |   |   |   |
| Income tax expense                                                                                                         |          | 242,528    |   |   | 31,018   |   |        | 337    |                |   | -  |   |   | 273,883  |
| Equity in the net income of subsidiaries                                                                                   |          | 54,218     |   |   | -        |   |        | -      |                |   | (54,218) |   |   | -  |
|                                                                                                                       |          |            |   |   |          |   |        |        |                |   |   |   |   |   |
| Net income (loss) from continuing operations                                                                               |          | 490,924    |   |   | 58,370        |   |        | (368)       |                |   | (54,218) |   |   | 494,708  |
|                                                                                                                       |          |            |   |   |          |   |        |        |                |   |   |   |   |   |
| Loss from discontinued operations, net of tax                                                                              |          | -          |   |   | -        |   |        | (3,784)     |                |   | -  |   |   | (3,784) |
|                                                                                                                       |          |            |   |   |          |   |        |        |                |   |   |   |   |   |
| Net income (loss)                                                                                                          | $             | 490,924    |   | $      | 58,370   |   | $           | (4,152)     |                | $ | (54,218) |   | $ | 490,924  |

|   | (1)  SLUS as Parent, SLNY’s and Other Subs’ net investment income includes an increase in market value of trading fixed maturity securities of $848.1 million, $93.3 million and $0.0 million, respectively, for the six-month period ended June 30, 2009. |
|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                                                                                            | SLUSas Parent |            |  SLNY |   | OtherSubs            |   |  Elimination |              | ConsolidatedCompany |
|-----------------------------------------------------------------------------------------------------------------|---------------|-----------------|------------|--------|----------------------|--------|-------------------|-------------------|---------------------|
|                                                                                                            |          |            |       |   |                 |   |              |              |                |   |   |   |   |   |
| Revenues                                                                                                        |          |            |       |   |                 |   |              |              |                |   |   |   |   |   |
|                                                                                                            |          |            |       |   |                 |   |              |              |                |   |   |   |   |   |
| Premiums and annuity considerations                                                                             | $             | 3,216      |       | $      | 29,962          |   | $                 | -            |                | $ | -  |   | $ | 33,178  |
| Net investment income (1)                                                                                       |          | 367,226    |       |   | 40,005          |   |              | 387          |                |   | -  |   |   | 407,618  |
| Net derivative loss                                                                                             |          | (472,235)  |       |   | (53,480)        |   |              | -            |                |   | -  |   |   | (525,715)  |
| Net realized investment gains (losses), excluding  impairment losses on available-for-sale securities |          | 12,012     |       |   | 204             |   |              | (1,042)      |                |   | -  |   |   | 11,174  |
| Other-than-temporary impairment losses                                                                          |          | -          |       |   | -               |   |              | -            |                |   | -  |   |   | -  |
| Fee and other income                                                                                            |          | 109,625    |       |   | 8,492           |   |              | 2,358        |                |   | -  |   |   | 120,475  |
|                                                                                                            |          |            |       |   |                 |   |              |              |                |   |   |   |   |   |
| Total revenues                                                                                                  |          | 19,844     |       |   | 25,183          |   |              | 1,703        |                |   | -  |   |   | 46,730  |
|                                                                                                            |          |            |       |   |                 |   |              |              |                |   |   |   |   |   |
| Benefits and Expenses                                                                                           |          |            |       |   |                 |   |              |              |                |   |   |   |   |   |
|                                                                                                            |          |            |       |   |                 |   |              |              |                |   |   |   |   |   |
| Interest credited                                                                                               |          | 74,697     |       |   | 12,478          |   |              | 253          |                |   | -  |   |   | 87,428  |
| Interest expense                                                                                                |          | 9,383      |       |   | (28)            |   |              | -            |                |   | -  |   |   | 9,355  |
| Policyowner benefits                                                                                            |          | 60,497     |       |   | 21,390          |   |              | 87           |                |   | -  |   |   | 81,974  |
| Amortization of DAC, VOBA and VOCRA                                                                             |          | (430,028)  |       |   | 5,087           |   |              | -            |                |   | -  |   |   | (424,941)  |
| Other operating expenses                                                                                        |          | 66,161     |       |   | 10,527          |   |              | 2,195        |                |   | -  |   |   | 78,883  |
|                                                                                                            |          |            |       |   |                 |   |              |              |                |   |   |   |   |   |
| Total benefits and expenses                                                                                     |          | (219,290)  |       |   | 49,454          |   |              | 2,535        |                |   | -  |   |   | (167,301)  |
|                                                                                                            |          |            |       |   |                 |   |              |              |                |   |   |   |   |   |
| Income (loss) before income tax expense (benefit)                                                               |          | 239,134    |       |   | (24,271)        |   |              | (832)        |                |   | -  |   |   | 214,031  |
|                                                                                                            |          |            |       |   |                 |   |              |              |                |   |   |   |   |   |
| Income tax expense (benefit)                                                                                    |          | 78,133     |       |   | (8,628)         |   |              | (274)        |                |   | -  |   |   | 69,231  |
| Equity in the net loss of subsidiaries                                                                          |          | (16,201)   |       |   | -               |   |              | -            |                |   | 16,201  |   |   | - |
|                                                                                                            |          |            |       |   |                 |   |              |              |                |   |   |   |   |   |
| Net income (loss)                                                                                               | $             | 144,800    |       | $      |  (15,643)  |   | $                 |  (558)  |                | $ | 16,201  |   | $ | 144,800  |

|   |  (1) SLUS as parent, SLNY’s and Other Subs’ net investment income includes an increase in market value of trading fixed maturity securities of $161.7 million, $17.8 million and $0.0 million, respectively, for the three-month period ended June 30, 2010. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                                                                                                                               | SLUSas Parent |            |  SLNY |   | OtherSubs     |   |  Elimination |         | ConsolidatedCompany |
|----------------------------------------------------------------------------------------------------------------------------------------------------|---------------|-----------------|------------|--------|---------------|--------|-------------------|--------------|---------------------|
|                                                                                                                                               |          |            |       |   |          |   |              |         |                |   |   |   |   |   |
| Revenues                                                                                                                                           |          |            |       |   |          |   |              |         |                |   |   |   |   |   |
|                                                                                                                                               |          |            |       |   |          |   |              |         |                |   |   |   |   |   |
| Premiums and annuity considerations                                                                                                                | $             | 3,433      |       | $      | 29,522   |   | $                 | -       |                | $ | -  |   | $ | 32,955  |
| Net investment income (1)                                                                                                                          |          | 967,097    |       |   | 105,031  |   |              | 1,158   |                |   | -  |   |   | 1,073,286 |
| Net derivative income                                                                                                                              |          | 23,539     |       |   | 10,267   |   |              | -       |                |   | -  |   |   | 33,806  |
| Net realized investment (losses) gains, excluding    impairment losses on available-for-sale    securities |          | (446)           |       |   | 45       |   |              | (539)        |                |   | -  |   |   | (940) |
| Other-than-temporary impairment losses                                                                                                             |          | (4,450)         |       |   | (181)         |   |              | (203)        |                |   | -  |   |   | (4,834) |
| Fee and other income                                                                                                                               |          | 84,852     |       |   | 4,392    |   |              | 1,223   |                |   | -  |   |   | 90,467  |
|                                                                                                                                               |          |            |       |   |          |   |              |         |                |   |   |   |   |   |
| Total revenues                                                                                                                                     |          | 1,074,025  |       |   | 149,076  |   |              | 1,639   |                |   | -  |   |   | 1,224,740  |
|                                                                                                                                               |          |            |       |   |          |   |              |         |                |   |   |   |   |   |
| Benefits and Expenses                                                                                                                              |          |            |       |   |          |   |              |         |                |   |   |   |   |   |
|                                                                                                                                               |          |            |       |   |          |   |              |         |                |   |   |   |   |   |
| Interest credited                                                                                                                                  |          | 97,907     |       |   | 13,952   |   |              | 515     |                |   | -  |   |   | 112,374  |
| Interest expense                                                                                                                                   |          | 13,659     |       |   | (1)           |   |              | -       |                |   | -  |   |   | 13,658  |
| Policyowner benefits                                                                                                                               |          | (32,645)        |       |   | 19,624   |   |              | 1,070   |                |   | -  |   |   | (11,951) |
| Amortization of DAC, VOBA and VOCRA                                                                                                                |          | 475,058    |       |   | 34,186   |   |              | -       |                |   | -  |   |   | 509,244  |
| Other operating expenses                                                                                                                           |          | 37,731     |       |   | 8,160    |   |              | 912     |                |   | -  |   |   | 46,803  |
|                                                                                                                                               |          |            |       |   |          |   |              |         |                |   |   |   |   |   |
| Total benefits and expenses                                                                                                                        |          | 591,710    |       |   | 75,921   |   |              | 2,497   |                |   | -  |   |   | 670,128  |
|                                                                                                                                               |          |            |       |   |          |   |              |         |                |   |   |   |   |   |
| Income (loss) from continuing operations before     income tax expense (benefit)                                          |          | 482,315    |       |   | 73,155   |   |              | (858)        |                |   | -  |   |   | 554,612  |
|                                                                                                                                               |          |            |       |   |          |   |              |         |                |   |   |   |   |   |
| Income tax expense (benefit)                                                                                                                       |          | 174,134    |       |   | 27,060   |   |              | (14)         |                |   | -  |   |   | 201,180  |
| Equity in the net income of subsidiaries                                                                                                           |          | 133,129    |       |   | -        |   |              | -       |                |   | (133,129) |   |   | -  |
|                                                                                                                                               |          |            |       |   |          |   |              |         |                |   |   |   |   |   |
| Net income (loss) from continuing operations                                                                                                       |          | 441,310    |       |   | 46,095   |   |              | (844)        |                |   | (133,129) |   |   | 353,432  |
|                                                                                                                                               |          |            |       |   |          |   |              |         |                |   |   |   |   |   |
| Income from discontinued operations, net of tax                                                                                                    |          | -          |       |   | -        |   |              | 87,878  |                |   | -  |   |   | 87,878  |
|                                                                                                                                               |          |            |       |   |          |   |              |         |                |   |   |   |   |   |
| Net income                                                                                                                                         | $             | 441,310    |       | $      | 46,095   |   | $                 | 87,034  |                | $ | (133,129) |   | $ | 441,310  |

|   |  (1) SLUS as parent, SLNY’s and Other Subs’ net investment income includes an increase in market value of trading fixed maturity securities of $819.4 million, $92.1 million and $0.0 million, respectively, for the three-month period ended June 30, 2009. |
|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

|                                                       | SLUSas Parent |             |  SLNY |   | OtherSubs       |   |  Elimination |          | ConsolidatedCompany |
|------------------------------------------------------------|---------------|------------------|------------|--------|-----------------|--------|-------------------|---------------|---------------------|
| ASSETS                                                     |          |             |       |   |            |   |              |          |                |   |   |   |   |   |
|                                                       |          |             |       |   |            |   |              |          |                |   |   |   |   |   |
| Investments                                                |          |             |       |   |            |   |              |          |                |   |   |   |   |   |
| Available-for-sale fixed maturity securities at fair value | $             | 1,245,552   |       | $      | 237,809    |   | $                 | 51,992   |                | $ | -  |   | $ | 1,535,353  |
| Trading fixed maturity securities at fair value            |          | 10,582,486  |       |   | 1,486,488  |   |              | -        |                |   | -  |   |   | 12,068,974  |
| Investment in subsidiaries                                 |          | 527,003     |       |   | -          |   |              | -        |                |   | (527,003) |   |   | -  |
| Mortgage loans                                             |          | 1,633,567   |       |   | 183,526    |   |              | 27,479   |                |   | -  |   |   | 1,844,572  |
| Derivative instruments – receivable                  |          | 286,370     |       |   | -          |   |              | -        |                |   | -  |   |   | 286,370  |
| Limited partnerships                                       |          | 46,418      |       |   | -          |   |              | -        |                |   | -  |   |   | 46,418  |
| Real estate                                                |          | 159,184     |       |   | -          |   |              | 45,208   |                |   | -  |   |   | 204,392  |
| Policy loans                                               |          | 691,294     |       |   | 1,499      |   |              | 21,041   |                |   | -  |   |   | 713,834  |
| Other invested assets                                      |          | 6,831       |       |   | 1,110      |   |              | -        |                |   | -  |   |   | 7,941  |
| Short-term investments                                     |          | 75,086      |       |   | -          |   |              | -        |                |   | -  |   |   | 75,086  |
| Cash and cash equivalents                                  |          | 1,892,969   |       |   | 166,766    |   |              | 15,264   |                |   | -  |   |   | 2,074,999  |
| Total investments and cash                                 |          | 17,146,760  |       |   | 2,077,198  |   |              | 160,984  |                |   | (527,003) |   |   | 18,857,939  |
|                                                       |          |             |       |   |            |   |              |          |                |   |   |   |   |   |
| Accrued investment income                                  |          | 204,279     |       |   | 19,843     |   |              | 1,746    |                |   | -  |   |   | 225,868  |
| Deferred policy acquisition costs                          |          | 2,400,451   |       |   | 159,424    |   |              | -        |                |   | -  |   |   | 2,559,875  |
| Value of business and customer renewals acquired           |          | 167,189     |       |   | 5,188      |   |              | -        |                |   | -  |   |   | 172,377  |
| Net deferred tax asset                                     |          | 381,229     |       |   | 11,097     |   |              | 4,403    |                |   | -  |   |   | 396,729  |
| Goodwill                                                   |          | -           |       |   | 7,299      |   |              | -        |                |   | -  |   |   | 7,299  |
| Receivable for investments sold                            |          | 549,850     |       |   | 3,014      |   |              | -        |                |   | -  |   |   | 552,864  |
| Reinsurance receivable                                     |          | 2,226,183   |       |   | 142,796    |   |              | 35       |                |   | -  |   |   | 2,369,014  |
| Other assets                                               |          | 99,788      |       |   | 41,404     |   |              | 2,524    |                |   | (14,316) |   |   | 129,400  |
| Separate account assets                                    |          | 22,522,319  |       |   | 1,044,851  |   |              | 37,214   |                |   | -  |   |   | 23,604,384  |
|                                                       |          |             |       |   |            |   |              |          |                |   |   |   |   |   |
| Total assets                                               | $             | 45,698,048  |       | $      | 3,512,114  |   | $                 | 206,906  |                | $ | (541,319) |   | $ | 48,875,749  |
|                                                       |          |             |       |   |            |   |              |          |                |   |   |   |   |   |
| LIABILITIES                                                |          |             |       |   |            |   |              |          |                |   |   |   |   |   |
|                                                       |          |             |       |   |            |   |              |          |                |   |   |   |   |   |
| Contractholder deposit funds and other policy liabilities  | $             | 15,185,730  |       | $      | 1,654,396  |   | $                 | 24,580   |                | $ | -  |   | $ | 16,864,706  |
| Future contract and policy benefits                        |          | 722,728     |       |   | 104,410    |   |              | 207      |                |   | -  |   |   | 827,345  |
| Payable for investments purchased                          |          | 169,730     |       |   | 25,817     |   |              | -        |                |   | -  |   |   | 195,547  |
| Accrued expenses and taxes                                 |          | 107,478     |       |   | 10,489     |   |              | 1,806    |                |   | (14,316) |   |   | 105,457  |
| Debt payable to affiliates                                 |          | 883,000     |       |   | -          |   |              | -        |                |   | -  |   |   | 883,000  |
| Reinsurance payable                                        |          | 2,001,443   |       |   | 217,983    |   |              | 35       |                |   | -  |   |   | 2,219,461  |
| Derivative instruments – payable                     |          | 602,790     |       |   | -          |   |              | -        |                |   | -  |   |   | 602,790  |
| Other liabilities                                          |          | 222,498     |       |   | 44,790     |   |              | 25,439   |                |   | -  |   |   | 292,727  |
| Separate account liabilities                               |          | 22,522,319  |       |   | 1,044,851  |   |              | 37,214   |                |   | -  |   |   | 23,604,384  |
|                                                       |          |             |       |   |            |   |              |          |                |   |   |   |   |   |
| Total liabilities                                          | $             | 42,417,716  |       | $      | 3,102,736  |   | $                 | 89,281   |                | $ | (14,316) |   | $       ,488 | 45,595,417  |
|                                                       |          |             |       |   |            |   |              |          |                |   |   |   |   |   |
| STOCKHOLDER’S EQUITY                                 |          |             |       |   |            |   |              |          |                |   |   |   |   |   |
|                                                       |          |             |       |   |            |   |              |          |                |   |   |   |   |   |
| Common stock                                               | $             | 6,437       |       | $      | 2,100      |   | $                 | 2,542    |                | $ | (4,642) |   | $ | 6,437  |
| Additional paid-in capital                                 |          | 3,927,875   |       |   | 389,963    |   |              | 95,929   |                |   | (485,892) |   |   | 3,927,875  |
| Accumulated other comprehensive income (loss)              |          | 52,475      |       |   | 3,307      |   |              | 1,582    |                |   | (4,889) |   |   | 52,475  |
| (Accumulated deficit) retained earnings                    |          | (706,455)   |       |   | 14,008     |   |              | 17,572   |                |   | (31,580) |   |   | (706,455)  |
|                                                       |          |             |       |   |            |   |              |          |                |   |   |   |   |   |
| Total stockholder’s equity                           |          | 3,280,332   |       |   | 409,378    |   |              | 117,625  |                |   | (527,003) |   |   | 3,280,332  |
|                                                       |          |             |       |   |            |   |              |          |                |   |   |   |   |   |
| Total liabilities and stockholder’s equity           | $             | 45,698,048  |       | $      | 3,512,114  |   | $                 | 206,906  |                | $ | (541,319) |   | $ | 48,875,749  |

----

|                                                       | SLUSas Parent |             |  SLNY |   | OtherSubs       |   |  Elimination |          | ConsolidatedCompany |
|------------------------------------------------------------|---------------|------------------|------------|--------|-----------------|--------|-------------------|---------------|---------------------|
| ASSETS                                                     |          |             |       |   |            |   |              |          |                |   |   |   |   |   |
|                                                       |          |             |       |   |            |   |              |          |                |   |   |   |   |   |
| Investments                                                |          |             |       |   |            |   |              |          |                |   |   |   |   |   |
| Available-for-sale fixed maturity securities at fair value | $             | 959,156     |       | $      | 164,158    |   | $                 | 52,202   |                | $ | -  |   | $ | 1,175,516  |
| Trading fixed maturity securities at fair value            |          | 9,724,195   |       |   | 1,406,327  |   |              | -        |                |   | -  |   |   | 11,130,522  |
| Investment in subsidiaries                                 |          | 518,560     |       |   | -          |   |              | -        |                |   | (518,560) |   |   | -  |
| Mortgage loans                                             |          | 1,736,358   |       |   | 161,498    |   |              | 14,105   |                |   | -  |   |   | 1,911,961  |
| Derivative instruments – receivable                  |          | 259,227     |       |   | -          |   |              | -        |                |   | -  |   |   | 259,227  |
| Limited partnerships                                       |          | 51,656      |       |   | -          |   |              | -        |                |   | -  |   |   | 51,656  |
| Real estate                                                |          | 158,170     |       |   | -          |   |              | 44,107   |                |   | -  |   |   | 202,277  |
| Policy loans                                               |          | 700,974     |       |   | 270        |   |              | 21,346   |                |   | -  |   |   | 722,590  |
| Other invested assets                                      |          | 46,410      |       |   | 542        |   |              | 469      |                |   | -  |   |   | 47,421  |
| Short-term investments                                     |          | 1,208,320   |       |   | 58,991     |   |              | -        |                |   | -  |   |   | 1,267,311  |
| Cash and cash equivalents                                  |          | 1,616,991   |       |   | 175,322    |   |              | 11,895   |                |   | -  |   |   | 1,804,208  |
| Total investments and cash                                 |          | 16,980,017  |       |   | 1,967,108  |   |              | 144,124  |                |   | (518,560) |   |   | 18,572,689  |
|                                                       |          |             |       |   |            |   |              |          |                |   |   |   |   |   |
| Accrued investment income                                  |          | 211,725     |       |   | 17,051     |   |              | 1,815    |                |   | -  |   |   | 230,591  |
| Deferred policy acquisition costs                          |          | 1,989,676   |       |   | 183,966    |   |              | -        |                |   | -  |   |   | 2,173,642  |
| Value of business and customer renewals acquired           |          | 163,079     |       |   | 5,766      |   |              | -        |                |   | -  |   |   | 168,845  |
| Net deferred tax asset                                     |          | 539,323     |       |   | 5,830      |   |              | 4,611    |                |   | -  |   |   | 549,764  |
| Goodwill                                                   |          | -           |       |   | 7,299      |   |              | -        |                |   | -  |   |   | 7,299  |
| Receivable for investments sold                            |          | 11,969      |       |   | 642        |   |              | -        |                |   | -  |   |   | 12,611  |
| Reinsurance receivable                                     |          | 2,232,651   |       |   | 117,460    |   |              | 96       |                |   | -  |   |   | 2,350,207  |
| Other assets                                               |          | 114,177     |       |   | 69,161     |   |              | 1,975    |                |   | (1,350) |   |   | 183,963  |
| Separate account assets                                    |          | 22,293,989  |       |   | 989,939    |   |              | 42,395   |                |   | -  |   |   | 23,326,323  |
|                                                       |          |             |       |   |            |   |              |          |                |   |   |   |   |   |
| Total assets                                               | $             | 44,536,606  |       | $      | 3,364,222  |   | $                 | 195,016  |                | $ | (519,910) |   | $ | 47,575,934  |
|                                                       |          |             |       |   |            |   |              |          |                |   |   |   |   |   |
| LIABILITIES                                                |          |             |       |   |            |   |              |          |                |   |   |   |   |   |
|                                                       |          |             |       |   |            |   |              |          |                |   |   |   |   |   |
| Contractholder deposit funds and other policy liabilities  | $             | 15,078,201  |       | $      | 1,605,038  |   | $                 | 26,350   |                | $ | -  |   | $ | 16,709,589  |
| Future contract and policy benefits                        |          | 716,176     |       |   | 99,255     |   |              | 207      |                |   | -  |   |   | 815,638  |
| Payable for investments purchased                          |          | 87,554      |       |   | 577        |   |              | -        |                |   | -  |   |   | 88,131  |
| Accrued expenses and taxes                                 |          | 51,605      |       |   | 10,202     |   |              | 1,446    |                |   | (1,350) |   |   | 61,903  |
| Debt payable to affiliates                                 |          | 883,000     |       |   | -          |   |              | -        |                |   | -  |   |   | 883,000  |
| Reinsurance payable                                        |          | 2,040,864   |       |   | 190,863    |   |              | 37       |                |   | -  |   |   | 2,231,764  |
| Derivative instruments – payable                     |          | 572,910     |       |   | -          |   |              | -        |                |   | -  |   |   | 572,910  |
| Other liabilities                                          |          | 205,855     |       |   | 48,608     |   |              | 25,761   |                |   | -  |   |   | 280,224  |
| Separate account liabilities                               |          | 22,293,989  |       |   | 989,939    |   |              | 42,395   |                |   | -  |   |   | 23,326,323  |
|                                                       |          |             |       |   |            |   |              |          |                |   |   |   |   |   |
| Total liabilities                                          | $             | 41,930,154  |       | $      | 2,944,482  |   | $                 | 96,196   |                | $ | (1,350) |   | $ | 44,969,482  |
|                                                       |          |             |       |   |            |   |              |          |                |   |   |   |   |   |
| STOCKHOLDER’S EQUITY                                 |          |             |       |   |            |   |              |          |                |   |   |   |   |   |
|                                                       |          |             |       |   |            |   |              |          |                |   |   |   |   |   |
| Common stock                                               | $             | 6,437       |       | $      | 2,100      |   | $                 | 2,542    |                | $ | (4,642) |   | $ | 6,437  |
| Additional paid-in capital                                 |          | 3,527,677   |       |   | 389,963    |   |              | 78,409   |                |   | (468,372) |   |   | 3,527,677  |
| Accumulated other comprehensive income (loss)              |          | 35,244      |       |   | (3,039)         |   |              | 701      |                |   | 2,338  |   |   | 35,244  |
| (Accumulated deficit) retained earnings                    |          | (962,906)        |       |   | 30,716     |   |              | 17,168   |                |   | (47,884) |   |   | (962,906) |
|                                                       |          |             |       |   |            |   |              |          |                |   |   |   |   |   |
| Total stockholder’s equity                           |          | 2,606,452   |       |   | 419,740    |   |              | 98,820   |                |   | (518,560) |   |   | 2,606,452  |
|                                                       |          |             |       |   |            |   |              |          |                |   |   |   |   |   |
| Total liabilities and stockholder’s equity           | $             | 44,536,606  |       | $      | 3,364,222  |   | $                 | 195,016       |                | $ | (519,910) |   | $ | 47,575,934  |

----

|                                                                                                                              | SLUSas Parent |            |  SLNY |   | OtherSubs     |   |  Elimination |           | ConsolidatedCompany |
|-----------------------------------------------------------------------------------------------------------------------------------|---------------|-----------------|------------|--------|---------------|--------|-------------------|----------------|---------------------|
|                                                                                                                              |          |            |       |   |          |   |              |           |                |   |   |   |   |   |
| Cash Flows From Operating Activities:                                                                                             |          |            |       |   |          |   |              |           |                |   |   |   |   |   |
| Net income (loss)                                                                                                                 | $             | 256,451    |       | $      | (16,708)      |   | $                 | 400       |                | $ | 16,308  |   | $ | 256,451  |
| Adjustments to reconcile net income (loss) to net       cash provided by operating activities: |          |            |       |   |          |   |              |           |                |   |   |   |   |   |
| Net amortization of premiums on investments                                                                                       |          | 8,356      |       |   | 1,597    |   |              | 412       |                |   | -  |   |   | 10,365  |
| Amortization of DAC, VOBA and VOCRA                                                                                               |          | (294,707)       |       |   | 41,475   |   |              | -         |                |   | -  |   |   | (253,232) |
| Depreciation and amortization                                                                                                     |          | 1,858      |       |   | 156      |   |              | 416       |                |   | -  |   |   | 2,430  |
| Net losses on derivatives                                                                                                         |          | 462,688    |       |   | 46,981   |   |              | -         |                |   | -  |   |   | 509,669  |
| Net realized (gains) losses and OTTI credit losseson available-for-sale investments                                               |          | (15,647)        |       |   | (450)         |   |              | 643       |                |   | -  |   |   | (15,454) |
| Net increase in fair value of trading investments                                                                                 |          | (414,928)       |       |   | (34,926)      |   |              | -         |                |   | -  |   |   | (449,854) |
| Net realized losses (gains) on trading investments                                                                                |          | 37,643     |       |   | (6,821)       |   |              | -         |                |   | -  |   |   | 30,822  |
| Undistributed loss on private equity limitedpartnerships                                                                          |          | 492        |       |   | -        |   |              | -         |                |   | -  |   |   | 492  |
| Interest credited to contractholder deposits                                                                                      |          | 151,353    |       |   | 25,011   |   |              | 447       |                |   | -  |   |   | 176,811  |
| Deferred federal income taxes                                                                                                     |          | 152,706    |       |   | (8,684)       |   |              | (266)          |                |   | -  |   |   | 143,756  |
| Equity in net loss of subsidiaries                                                                                                |          | 16,308     |       |   | -        |   |              | -         |                |   | (16,308) |   |   | -  |
| Changes in assets and liabilities:                                                                                                |          |            |       |   |          |   |              |           |                |   |   |   |   |   |
| Additions to DAC, VOBA and VOCRA                                                                                                  |          | (104,733)       |       |   | (13,213)      |   |              | -         |                |   | -  |   |   | (117,946) |
| Accrued investment income                                                                                                         |          | 7,446      |       |   | (2,792)       |   |              | 69        |                |   | -  |   |   | 4,723  |
| Net change in reinsurance receivable/payable                                                                                      |          | 32,707     |       |   | 4,023    |   |              | 59        |                |   | -  |   |   | 36,789  |
| Future contract and policy benefits                                                                                               |          | 6,552      |       |   | 5,155    |   |              | -         |                |   | -  |   |   | 11,707  |
| Other, net                                                                                                                        |          | 110,812    |       |   | 27,657   |   |              | (441)          |                |   | -  |   |   | 138,028  |
|                                                                                                                              |          |            |       |   |          |   |              |           |                |   |   |   |   |   |
| Net cash provided by operating activities                                                                                         |          | 415,357    |       |   | 68,461   |   |              | 1,739     |                |   | -  |   |   | 485,557  |
|                                                                                                                              |          |            |       |   |          |   |              |           |                |   |   |   |   |   |
| Cash Flows From Investing Activities:                                                                                             |          |            |       |   |          |   |              |           |                |   |   |   |   |   |
| Sales, maturities and repayments of:                                                                                              |          |            |       |   |          |   |              |           |                |   |   |   |   |   |
| Available-for-sale fixed maturity securities                                                                                      |          | 263,284    |       |   | 15,673   |   |              | 5,695     |                |   | -  |   |   | 284,652  |
| Trading fixed maturity securities                                                                                                 |          | 1,085,123  |       |   | 403,321  |   |              | -         |                |   | -  |   |   | 1,488,444  |
| Mortgage loans                                                                                                                    |          | 103,022    |       |   | 5,428    |   |              | 178       |                |   | (16,208) |   |   | 92,420  |
| Real estate                                                                                                                       |          | -          |       |   | 1,000    |   |              | -         |                |   | (1,000) |   |   | -  |
| Other invested assets                                                                                                             |          | 151,609    |       |   | 790      |   |              | 501       |                |   | -  |   |   | 152,900  |
| Purchases of:                                                                                                                     |          |            |       |   |          |   |              |           |                |   |   |   |   |   |
| Available-for-sale fixed maturity securities                                                                                      |          | (519,345)       |       |   | (79,282)      |   |              | (3,665)        |                |   | -  |   |   | (602,292) |
| Trading fixed maturity securities                                                                                                 |          | (2,050,758)     |       |   | (421,351)     |   |              | -         |                |   | -  |   |   | (2,472,109) |
| Mortgage loans                                                                                                                    |          | (43)            |       |   | (28,440)      |   |              | (16,276)       |                |   | 16,208  |   |   | (28,551) |
| Real estate                                                                                                                       |          | (2,627)         |       |   | -        |   |              | (347)          |                |   | 1,000  |   |   | (1,974) |
| Other invested assets                                                                                                             |          | (27,963)        |       |   | (292)         |   |              | -         |                |   | -  |   |   | (28,255) |
| Net change in other investments                                                                                                   |          | -          |       |   | -        |   |              | -         |                |   | -  |   |   | -  |
| Net change in policy loans                                                                                                        |          | 9,680      |       |   | (1,229)       |   |              | 305       |                |   | -  |   |   | 8,756  |
| Net change in short-term investments                                                                                              |          | 1,133,234  |       |   | 58,991   |   |              | -         |                |   | -  |   |   | 1,192,225  |
|                                                                                                                              |          |            |       |   |          |   |              |           |                |   |   |   |   |   |
| Net cash provided by (used in) investing activities                                                                               | $             | 145,216    |       | $      | (45,391)      |   | $                 | (13,609)  |                | $ | -   |   | $ | 86,216  |

----

|                                                | SLUSas Parent |            |  SLNY |   | OtherSubs     |   |  Elimination |         | ConsolidatedCompany |
|-----------------------------------------------------|---------------|-----------------|------------|--------|---------------|--------|-------------------|--------------|---------------------|
|                                                |          |            |       |   |          |   |              |         |                |   |   |   |   |   |
| Cash Flows From Financing Activities:               |          |            |       |   |          |   |              |         |                |   |   |   |   |   |
| Additions to contractholder deposit funds           | $             | 552,828    |       | $      | 95,073   |   | $                 | -       |                | $ | -  |   | $ | 647,901  |
| Withdrawals from contractholder deposit funds       |          | (1,210,817)     |       |   | (123,089)     |   |              | (2,216)      |                |   | -  |   |   | (1,336,122) |
| Additional capital contributed to subsidiaries      |          | (17,520)        |       |   | -        |   |              | -       |                |   | 17,520  |   |   | -  |
| Capital contribution from Parent                    |          | 400,000    |       |   | -        |   |              | 17,520       |                |   | (17,520) |   |   | 400,000 |
| Debt proceeds                                       |          | -          |       |   | -        |   |              | -       |                |   | -  |   |   | -  |
| Other, net                                          |          | (9,086)         |       |   | (3,610)       |   |              | (65)         |                |   | -  |   |   | (12,761) |
|                                                |          |            |       |   |          |   |              |         |                |   |   |   |   |   |
| Net cash (used in) provided by financing activities |          | (284,595)       |       |   | (31,626)      |   |              | 15,239  |                |   | -  |   |   | (300,982) |
|                                                |          |            |       |   |          |   |              |         |                |   |   |   |   |   |
| Net change in cash and cash equivalents             |          | 275,978    |       |   | (8,556)       |   |              | 3,369   |                |   | -  |   |   | 270,791  |
|                                                |          |            |       |   |          |   |              |         |                |   |   |   |   |   |
| Cash and cash equivalents, beginning of period      |          | 1,616,991  |       |   | 175,322  |   |              | 11,895  |                |   | -  |   |   | 1,804,208  |
|                                                |          |            |       |   |          |   |              |         |                |   |   |   |   |   |
| Cash and cash equivalents, end of period            | $             | 1,892,969  |       | $      | 166,766  |   | $                 | 15,264  |                | $ | -  |   | $ | 2,074,999  |
|                                                |          |            |       |   |          |   |              |         |                |   |   |   |   |   |

----

|                                                                                                                            | SLUSas Parent |          |  SLNY |   | OtherSubs    |   |  Elimination |          | ConsolidatedCompany |
|---------------------------------------------------------------------------------------------------------------------------------|---------------|---------------|------------|--------|--------------|--------|-------------------|---------------|---------------------|
|                                                                                                                            |          |          |       |   |         |   |              |          |                |   |   |   |   |   |
| Cash Flows From Operating Activities:                                                                                           |          |          |       |   |         |   |              |          |                |   |   |   |   |   |
| Net income (loss)                                                                                                               | $             | 490,924  |       | $      | 58,370  |   | $                 | (4,152)       |                | $ | (54,218) |   | $ | 490,924  |
| Adjustments to reconcile net income (loss) to net     cash provided by (used in) operating activities: |          |          |       |   |         |   |              |          |                |   |   |   |   |   |
| Net amortization of premiums on investments                                                                                     |          | 8,042    |       |   | 307     |   |              | 7        |                |   | -  |   |   | 8,356  |
| Amortization of DAC, VOBA and VOCRA                                                                                             |          | 378,340  |       |   | 23,480  |   |              | -        |                |   | -  |   |   | 401,820  |
| Depreciation and amortization                                                                                                   |          | 2,250    |       |   | 156     |   |              | 400      |                |   | -  |   |   | 2,806 |
| Net gains on derivatives                                                                                                        |          | (217,839)     |       |   | (10,863)     |   |              | -        |                |   | -  |   |   | (228,702) |
| Net realized losses and OTTI credit losses on     available-for-sale investments                       |          | 6,842    |       |   | 137     |   |              | 692      |                |   | -  |   |   | 7,671  |
| Net increase in fair value of trading investments                                                                               |          | (848,138)     |       |   | (93,295)     |   |              | -        |                |   | -  |   |   | (941,433) |
| Net realized losses (gains) on trading investments                                                                              |          | 131,142  |       |   | 4,671   |   |              | (1)           |                |   | -  |   |   | 135,812  |
| Undistributed losses in private equity limited     partnerships                                        |          | 11,750   |       |   | -       |   |              | -        |                |   | -  |   |   | 11,750  |
| Interest credited to contractholder deposits                                                                                    |          | 198,014  |       |   | 26,164  |   |              | 980      |                |   | -  |   |   | 225,158  |
| Deferred federal income taxes                                                                                                   |          | 249,270  |       |   | 32,639  |   |              | (400)         |                |   | -  |   |   | 281,509  |
| Equity in net loss of subsidiaries                                                                                              |          | (54,218)      |       |   | -       |   |              | -        |                |   | 54,218  |   |   | -  |
| Changes in assets and liabilities:                                                                                              |          |          |       |   |         |   |              |          |                |   |   |   |   |   |
| Additions to DAC, VOBA and VOCRA                                                                                                |          | (173,266)     |       |   | (27,287)     |   |              | -        |                |   | -  |   |   | (200,553) |
| Accrued investment income                                                                                                       |          | (277)         |       |   | 1,251   |   |              | (11)          |                |   | -  |   |   | 963  |
| Net change in reinsurance receivable/payable                                                                                    |          | 101,044  |       |   | 2,161   |   |              | 958      |                |   | -  |   |   | 104,163  |
| Future contract and policy benefits                                                                                             |          | (52,199)      |       |   | 1,460   |   |              | (1)           |                |   | -  |   |   | (50,740) |
| Other, net                                                                                                                      |          | (10,920)      |       |   | (123,699)    |   |              | 219      |                |   | -  |   |   | (134,400) |
| Adjustments related to discontinued operations                                                                                  |          | -        |       |   | -       |   |              | 137,204  |                |   | -  |   |   | 137,204  |
|                                                                                                                            |          |          |       |   |         |   |              |          |                |   |   |   |   |   |
| Net cash provided by (used in) operating activities                                                                             |          | 220,761  |       |   | (104,348)    |   |              | 135,895  |                |   | -  |   |   | 252,308  |
|                                                                                                                            |          |          |       |   |         |   |              |          |                |   |   |   |   |   |
| Cash Flows From Investing Activities:                                                                                           |          |          |       |   |         |   |              |          |                |   |   |   |   |   |
| Sales, maturities and repayments of:                                                                                            |          |          |       |   |         |   |              |          |                |   |   |   |   |   |
| Available-for-sale fixed maturity securities                                                                                    |          | 23,038   |       |   | 3,406   |   |              | 222      |                |   | -  |   |   | 26,666  |
| Trading fixed maturity securities                                                                                               |          | 509,915  |       |   | 65,176  |   |              | 14,731   |                |   | -  |   |   | 589,822  |
| Mortgage loans                                                                                                                  |          | 110,608  |       |   | 4,999   |   |              | -        |                |   | -  |   |   | 115,607  |
| Other invested assets                                                                                                           |          | 74,825   |       |   | 1,595   |   |              | -        |                |   | -  |   |   | 76,420  |
| Purchases of:                                                                                                                   |          |          |       |   |         |   |              |          |                |   |   |   |   |   |
| Available-for-sale fixed maturity securities                                                                                    |          | (390,687)     |       |   | (1,626)      |   |              | (311)         |                |   | -  |   |   | (392,624) |
| Trading fixed maturity securities                                                                                               |          | (20,183)      |       |   | (111,299)    |   |              | 194      |                |   | -  |   |   | (131,288) |
| Mortgage loans                                                                                                                  |          | (49,774)      |       |   | -       |   |              | (5,563)       |                |   | -  |   |   | (55,337) |
| Real estate                                                                                                                     |          | 166      |       |   | -       |   |              | (211)         |                |   | -  |   |   | (45) |
| Other invested assets                                                                                                           |          | (57,784)      |       |   | (15)         |   |              | -        |                |   | -  |   |   | (57,799) |
| Net change in other investments                                                                                                 |          | (96,445)      |       |   | 10,250  |   |              | -        |                |   | -  |   |   | (86,195) |
| Net change in policy loans                                                                                                      |          | 7,331    |       |   | (52)         |   |              | 2,462    |                |   | -  |   |   | 9,741  |
| Net change in short-term investments                                                                                            |          | 104,149  |       |   | 69,977  |   |              | (56,297)      |                |   | -  |   |   | 117,829  |
|                                                                                                                            |          |          |       |   |         |   |              |          |                |   |   |   |   |   |
| Net cash provided by (used in) investing activities                                                                             | $             | 215,159  |       | $      | 42,411  |   | $                 | (44,773)      |                | $ | -  |   | $ | 212,797  |

----

|                                           | SLUSas Parent |            |  SLNY |   | OtherSubs     |   |  Elimination |          | ConsolidatedCompany |
|------------------------------------------------|---------------|-----------------|------------|--------|---------------|--------|-------------------|---------------|---------------------|
|                                           |          |            |       |   |          |   |              |          |                |   |   |   |   |   |
| Cash Flows From Financing Activities:          |          |            |       |   |          |   |              |          |                |   |   |   |   |   |
| Additions to contractholder deposit funds      | $             | 1,294,570  |       | $      | 296,642  |   | $                 | 22,115   |                | $ | -  |   | $ | 1,613,327  |
| Withdrawals from contractholder deposit funds  |          | (1,395,483)     |       |   | (129,392)     |   |              | (7,427)       |                |   | -  |   |   | (1,532,302) |
| Additional capital contributed to subsidiaries |          | (45,551)        |       |   | -        |   |              | -        |                |   | 45,551  |   |   | -  |
| Capital contribution from Parent               |          | 748,652    |       |   | -        |   |              | 45,551   |                |   | (45,551) |   |   | 748,652  |
| Debt proceeds                                  |          | -          |       |   | -        |   |              | 100,000  |                |   | -  |   |   | 100,000  |
| Other, net                                     |          | (34,258)        |       |   | (6,074)       |   |              | 176      |                |   | -  |   |   | (40,156) |
|                                           |          |            |       |   |          |   |              |          |                |   |   |   |   |   |
| Net cash provided by financing activities      |          | 567,930    |       |   | 161,176  |   |              | 160,415  |                |   | -  |   |   | 889,521  |
|                                           |          |            |       |   |          |   |              |          |                |   |   |   |   |   |
| Net change in cash and cash equivalents        |          | 1,003,850  |       |   | 99,239   |   |              | 251,537  |                |   | -  |   |   | 1,354,626  |
|                                           |          |            |       |   |          |   |              |          |                |   |   |   |   |   |
| Cash and cash equivalents, beginning of period |          | 733,518    |       |   | 261,989  |   |              | 29,161   |                |   | -  |   |   | 1,024,668  |
|                                           |          |            |       |   |          |   |              |          |                |   |   |   |   |   |
| Cash and cash equivalents, end of period       | $             | 1,737,368  |       | $      | 361,228  |   | $                 | 280,698  |                | $ | -  |   | $ | 2,379,294  |
|                                           |          |            |       |   |          |   |              |          |                |   |   |   |   |   |

----

| Ø   | Deferred policy acquisition costs (“DAC”); |
|--------------------|--------------------------------------------------------|

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

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

| Ø   | Derivative instruments; |
|--------------------|-------------------------|

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

| Ø   | Policy liabilities and accruals; |
|--------------------|----------------------------------|

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

| Ø   | Goodwill valuation; |
|--------------------|---------------------|

| Ø   | Allowance for loan loss; |
|--------------------|--------------------------|

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

| Ø   |  Provisions for income taxes. |
|--------------------|------------------------------------|

----

|                           |   |        |
|--------------------------------|--------|-------------|
| Total revenues                 | $      | (4,010)     |
| Total benefits and expenses    |   | 8,908  |
| Loss before income tax benefit |   | (12,918)    |
|                           |   |        |
| Net loss                       | $      | (3,784)     |

----

|                         |   | 2010                                                      |   | 2009                                                     |
|------------------------------|--------|-----------------------------------------------------------|--------|----------------------------------------------------------|
|                         |   |                                                      |   |                                                     |
| Interest rate contracts      |   | $        (78,669) |   | $       172,834  |
| Foreign currency contracts   |   | (5,425)                                                   |   | (2,209)                                                  |
| Equity contracts             |   | (14,012)                                                  |   | (41,488)                                                 |
| Credit contracts             |   | 623                                                  |   | (4,130)                                                  |
| Futures                      |   | 140,402                                              |   | (103,895)                                                |
| Embedded derivatives         |   | (610,084)                                                 |   | 142,540                                             |
| Net derivative (loss) income |   | $      (567,165)            |   | $       163,652  |

----

----

----

----

----

|                             | 2010   |                                                          | 2009   |
|----------------------------------|--------|---------------------------------------------------------------|--------|
|                             |   |                                                          |   |   |   |
| Total revenues                   | $      |       545,477              |   | $ | 1,517,470  |
| Total benefits and expenses      |   |         126,187  |   |   | 733,615  |
| Income before income tax expense |   |         419,290  |   |   | 783,855  |
|                             |   |                                                          |   |   |   |
| Net income                       | $      |       282,658              |   | $ | 512,509  |

----

----

|                                                               |  2010                                                                                                                   |   |  2009                                                                                   |
|--------------------------------------------------------------------|------------------------------------------------------------------------------------------------------------------------------|--------|----------------------------------------------------------------------------------------------|
| Total revenues                                                     | $              27,671                             |   | $             31,527   |
| Total benefits and expenses                                        | 26,308                                                                                                                  |   | 33,105                                                                                  |
|  Income (loss) before income tax  expense (benefit) | 1,363                                                                                                                   |   | (1,578)                                                                                      |
|                                                               |                                                                                                                         |   |                                                                                         |
| Net income (loss)                                                  | $                   971  |   | $              (4,642) |

----

|                             | 2010                                                                                                               |   | 2009                                                                                             |
|----------------------------------|--------------------------------------------------------------------------------------------------------------------|--------|--------------------------------------------------------------------------------------------------|
| Total revenues                   | $               64,576             |   | $            69,179             |
| Total benefits and expenses      | 61,992                                                                                                        |   | 55,716                                                                                      |
| Income before income tax expense | 2,584                                                                                                         |   | 13,463                                                                                      |
|                             |                                                                                                               |   |                                                                                             |
| Net income                       | $                 1,682  |   | $              8,751  |

----

|                           | 2010                                                                                    |   | 2009                                                                        |
|--------------------------------|-----------------------------------------------------------------------------------------|--------|-----------------------------------------------------------------------------|
| Total revenues                 | $             (33,518) |   | $           (13,089) |
| Total benefits and expenses    | 11,914                                                                             |   | 14,060                                                                 |
| Loss before income tax benefit | (45,432)                                                                                |   | (27,149)                                                                    |
|                           |                                                                                    |   |                                                                        |
| Net loss                       | $             (28,860) |   | $           (21,910) |

----

----

| 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-OxleyAct of 2002        |
|   |                                                                                                                         |
| 32.2   | Certification Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-OxleyAct of 2002        |

----

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

| August 13, 2010 | /s/ Westley V. Thompson                  |
|-----------------|------------------------------------------|
| Date            | Westley V. Thompson, President, SLF U.S. |
|            | (Principal Executive Officer)            |

| August 13, 2010 | /s/ Ronald H. Friesen                                                |
|-----------------|----------------------------------------------------------------------|
| Date            | Ronald H. Friesen, Senior Vice President and Chief Financial Officer |
|            | (Principal Financial Officer)                                        |

----