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================================================================================

                                    FORM 10-K

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

(Mark One)

[X]      ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
         EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 1999

                                       OR

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

         For the transition period from ____________ to ______________

                         Commission file number 1-12749

                               HARTFORD LIFE, INC.
             (Exact name of registrant as specified in its charter)

           DELAWARE                                            06-1470915
(State or other jurisdiction of                             (I.R.S. Employer
incorporation or organization)                            Identification Number)

                200 HOPMEADOW STREET, SIMSBURY, CONNECTICUT 06089
                    (Address of principal executive offices)

                                 (860) 525-8555
              (Registrant's telephone number, including area code)

Securities registered pursuant to section 12(b) of the Act: the following, which
are registered on the New York Stock Exchange, Inc.:
    Class A Common Stock, par value $0.01 per share
    7.2% Trust Preferred Securities, Series A, issued by Hartford Life Capital I

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

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

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

As of February 29, 2000, there were outstanding 25,934,517 shares of Class A
Common Stock, $0.01 par value per share, and 114,000,000 of Class B Common
Stock, $0.01 par value per share, of the registrant. The aggregate market value
of the shares of the registrant's common equity held by non-affiliates of the
registrant was $910,113,213 based on the closing price of $35.375 per share of
Class A Common Stock on the New York Stock Exchange on February 29, 2000.


                      Documents Incorporated by Reference:

Portions of the Registrant's definitive proxy statement for its 2000 annual
meeting of shareholders are incorporated by reference in Part III of this Form
10-K.


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[HARTFORD LIFE LOGO]

Hartford Life, Inc. and its subsidiaries (Hartford Life) is a leading financial
services and insurance organization providing investment products such as
variable annuities and mutual funds, individual and corporate owned life
insurance and employee benefits products.

A majority owned subsidiary of The Hartford Financial Services Group, Inc.,
Hartford Life is the nation's largest writer of individual variable annuities,
the number three writer of group disability insurance, a top provider of
individual variable life insurance and offers the fastest growing
non-proprietary family of mutual funds.



                                    CONTENTS


<TABLE>
<CAPTION>
              ITEM    DESCRIPTION                                                                           PAGE
<S>            <C>   <C>                                                                                   <C>
PART I          1     Business of Hartford Life                                                               3
                2     Properties                                                                             12
                3     Legal Proceedings                                                                      12
                4     Submission of Matters to a Vote of Security Holders                                    12

PART II         5     Market for Hartford Life's Common Stock and Related Stockholder Matters                12
                6     Selected Financial Data                                                                13
                7     Management's Discussion and Analysis of Financial Condition and
                      Results of Operations                                                                  14
               7A     Quantitative and Qualitative Disclosures About Market Risk                             36
                8     Financial Statements and Supplementary Data                                            36
                9     Changes in and Disagreements with Accountants on Accounting
                      and Financial Disclosure                                                               36

PART III       10     Directors and Executive Officers of Hartford Life                                      36
               11     Executive Compensation                                                                 36
               12     Security Ownership of Certain Beneficial Owners and Management                         36
               13     Certain Relationships and Related Transactions                                         36

PART IV        14     Exhibits, Financial Statements, Schedules and Reports on Form 8-K                      36
                      Signatures                                                                            II-1
                      Exhibits Index                                                                        II-2
</TABLE>


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PART I

ITEM 1.  BUSINESS OF HARTFORD LIFE

(Dollar amounts in millions, except for share data, unless otherwise stated)

GENERAL

Hartford Life, Inc. and its subsidiaries ("Hartford Life" or the "Company"), an
indirect subsidiary of The Hartford Financial Services Group, Inc. (The
Hartford), is headquartered in Simsbury, Connecticut and is a leading financial
services and insurance organization. Hartford Life provides (i) investment
products, including variable annuities, fixed market value adjusted (MVA)
annuities, mutual funds and retirement plan services for the savings and
retirement needs of over 1.3 million customers, (ii) life insurance for income
protection and estate planning to approximately 500,000 customers, (iii)
employee benefits products such as group life and group disability insurance for
the benefit of millions of individuals and (iv) corporate owned life insurance.
According to the latest publicly available data, with respect to the United
States, the Company is the largest writer of individual variable annuities based
on sales for the year ended December 31, 1999; the third largest writer of group
disability insurance based on premiums written for the nine months ended
September 30, 1999; as well as, the third largest consolidated life insurance
company based on statutory assets as of December 31, 1998. In addition, the
Company offers the fastest growing non-proprietary family of mutual funds. The
Company's strong position in each of its core businesses provides an opportunity
to increase the sale of Hartford Life's products and services as individuals
increasingly save and plan for retirement, protect themselves and their families
against disability or death and prepare their estates for an efficient transfer
of wealth between generations.

Hartford Life strives to maintain and enhance its position as a market leader
within the financial services industry and to maximize shareholder value. The
Company has pursued a strategy of developing and selling diverse and innovative
products through multiple distribution channels, continuously developing and
expanding those distribution channels, achieving cost efficiencies through
economies of scale and improved technology, maintaining effective risk
management and prudent underwriting techniques and capitalizing on its brand
name and customer recognition of The Hartford Stag Logo, one of the most
recognized symbols in the financial services industry. In the past year, the
Company's total assets under management, which includes $6.4 billion of assets
invested in the Company's retail mutual funds, increased 17% to $145.4 billion
and total stockholders' equity, excluding net unrealized capital losses on
securities, was $2.6 billion as of December 31, 1999. In addition, Hartford Life
generated $5.5 billion in revenues and $467 in net income in 1999. The Company's
return on stockholders' equity, excluding net unrealized capital gains (losses)
on securities, was 19.2% in 1999.

ORGANIZATION

Hartford Life, Inc., a Delaware corporation, was formed in December 1996 as a
direct subsidiary of Hartford Accident and Indemnity Company (HA&I) and an
indirect subsidiary of The Hartford. Pursuant to an initial public offering (the
"IPO") of 26 million shares of the Company's Class A Common Stock on May 22,
1997, Hartford Life became a publicly traded company representing approximately
18.6% of the equity ownership in the Company. Additional information regarding
the organization of the business and the IPO may be found in Notes 1 and 3 of
Notes to Consolidated Financial Statements, respectively.

As a holding company, Hartford Life, Inc. has no significant business operations
of its own and, therefore, relies mainly on the dividends from its insurance
company subsidiaries, which are primarily domiciled in Connecticut, as the
principal source of cash to meet its obligations (predominantly debt
obligations) and pay shareholder dividends. Statutory net income and statutory
capital and surplus are key determinants in the amount of dividend capacity
available in the insurance company subsidiaries. Each has grown significantly
over the past five years, although statutory net income of $220 in 1999 was
lower than 1998 due to losses realized on certain securities. Excluding these
losses, statutory net income in 1999 was $290, 9% higher than 1998 and nearly
four times 1994. Statutory capital and surplus as of December 31, 1999 was $2.2
billion, 10% higher than December 31, 1998 and 100% above the level as of
December 31, 1994. Additional information regarding the cash flow and liquidity
needs of Hartford Life, Inc. may be found in the Capital Resources and Liquidity
section of the Management's Discussion and Analysis of Financial Condition and
Results of Operations (MD&A).

DISTRIBUTION

Hartford Life utilizes a multiple channel distribution network which provides a
distinct competitive advantage in selling products and services to a broad
cross-section of customers throughout varying economic and market cycles. In
particular, the Company has developed an extensive network of banks and
broker-dealers, which is one of the largest in the industry, including over
1,500 national, regional and independent broker-dealers and approximately 500
banks. Consistent with this strategy, in 1998, the Company purchased all the
outstanding shares of PLANCO Financial Services, Inc. and its affiliate, PLANCO,
Incorporated (collectively, "PLANCO"), the nation's largest wholesaler of
individual annuities and the Company's primary wholesale distributor of its
Director(R) variable annuity and retail mutual funds, thus securing an important
distribution channel. In addition, the Company continues to

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expand its opportunity to sell through financial institutions. As of December
31, 1999, the Company was selling products through twenty-four of the nation's
twenty-five largest retail banks, including proprietary relationships with four
of the top ten. The Company's broad distribution network has enabled the Company
to introduce new products and services in an effective manner and allows the
Company significant opportunity to access its customer base. Hartford Life sells
variable annuities, mutual funds, fixed MVA annuities, variable life insurance
and retirement plan services through its broker-dealer and bank distribution
systems.

PRODUCTS

It is Hartford Life's belief that, as Americans journey through life, they have
specific needs related to building and preserving their financial resources. The
Company's goal is to be the "official supplier" of that journey--the preferred
source of financial solutions for both individuals and employers, as well as the
financial professionals who serve them. To achieve this goal, Hartford Life has
focused its efforts on offering products that provide mechanisms for saving
(e.g. mutual funds), planning for retirement (e.g. annuities) and protecting and
preserving income and wealth (e.g. individual life, group life and group
disability). To ensure that it is able to meet the emerging opportunities that
will arise for individuals pursuing their dreams in the new millennium, the
Company expects to continue to expend significant resources and development
efforts in creating innovative new products and services.

CUSTOMER SERVICE, TECHNOLOGY AND ECONOMIES OF SCALE

Hartford Life maintains advantageous economies of scale and operating
efficiencies due to its continued growth, attention to expense management and
commitment to customer service and technology. These advantages allow the
Company to competitively price its products for its distribution network and
policyholders. The Company continues to achieve operating efficiencies in its
Investment Products business. Operating expenses associated with the Company's
individual annuity products as a percentage of total individual annuity account
value have been more than cut in half over the past seven years, declining from
43 basis points in 1992 to 21 basis points in 1999. In addition, the Company
utilizes computer technology to enhance communications within the Company and
throughout its distribution network in order to improve the Company's efficiency
in marketing, selling and servicing its products and, as a result, provides
high-quality customer service. In recognition of excellence in customer service
for variable annuities, Hartford Life was awarded the 1999 Annuity Service Award
by DALBAR Inc., a recognized independent financial services research
organization, for the fourth consecutive year. Hartford Life is the only company
to receive this prestigious award in every year of its existence. Additional
information related to Hartford Life's technology in respect of Year 2000 issues
may be found in the Regulatory Matters and Contingencies section of the MD&A.

RISK MANAGEMENT

Hartford Life's product designs, prudent underwriting standards and risk
management techniques protect it against disintermediation risk and greater than
expected mortality and morbidity experience. As of December 31, 1999, the
Company had limited exposure to disintermediation risk on approximately 98% of
its insurance liabilities through the use of non-guaranteed separate accounts,
MVA features, policy loans, surrender charges and non-surrenderability
provisions. The Company effectively utilizes prudent underwriting to select and
price insurance risks and regularly monitors mortality and morbidity assumptions
to determine if experience remains consistent with these assumptions and to
ensure that its product pricing remains appropriate. The Company also enforces
disciplined claims management to protect itself against greater than expected
morbidity experience.

BRAND NAME AND FINANCIAL STRENGTH

The Hartford Stag Logo is one of the most recognized symbols in the insurance
and financial services industry. This brand recognition, coupled with a strong
balance sheet and sound ratings, has enabled the Company to establish the
reputation and financial strength necessary to maintain distribution
relationships, make strategic acquisitions and enhance important alliances and
generate new customer sales. Pursuant to a Master Intercompany Agreement with
The Hartford, the Company has been granted a perpetual non-exclusive license to
use the Stag Logo in connection with the sale of Hartford Life's products and
services. However, in the event that The Hartford reduces its beneficial
ownership below 50% of the combined voting power of the Company's then
outstanding securities, the license may be revoked upon the later of the fifth
anniversary of the date of consummation of the Company's IPO of its Class A
Common Stock or one year after receipt by the Company of written notice of The
Hartford's intention to revoke the license.

REPORTING SEGMENTS

Hartford Life has the following reportable operating segments: Investment
Products, Individual Life, Employee Benefits and Corporate Owned Life Insurance
(COLI). The Company includes in "Other" corporate items not directly allocable
to any of its reportable operating segments, principally interest expense, as
well as its international operations. The following is a description of each
segment, including a discussion of principal products, methods of distribution
and competitive environments. Additional information on Hartford Life's segments
may be found in the MD&A on pages 14 to 35 and Note 17 of Notes to Consolidated
Financial Statements.


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INVESTMENT PRODUCTS

The Investment Products segment focuses on the savings and retirement needs of
the growing number of individuals who are preparing for retirement or have
already retired through the sale of individual fixed and variable annuities,
mutual funds, retirement plan services and other investment products. From
December 31, 1995 to December 31, 1999, this segment's assets under management
grew to $111.7 billion from $43.9 billion, a five year compounded annual growth
rate of 26%. This growth has been driven primarily by strong net cash flow of
individual variable annuities, the result of a high volume of sales and
favorable persistency, as well as equity market appreciation in the separate
accounts of the Company's individual and group variable annuities. Investment
Products generated revenues of $2.0 billion and $1.8 billion in 1999 and 1998,
respectively. Net income in the Investment Products segment was $330 in 1999, a
24% increase over 1998.

Hartford Life is the market leader in the annuity industry and, according to
Variable Annuity and Research Data Service (VARDS), was the number one writer of
individual variable annuities in the United States for 1999 and 1998 with sales
of $10.3 billion and $9.9 billion, respectively. The Company sells both variable
and fixed individual annuity products through a wide distribution network of
national and regional broker-dealer organizations, banks and other financial
institutions and independent financial advisors. Total individual annuity sales
were $10.9 billion and $10.0 billion in 1999 and 1998, respectively. The Company
was also the number one seller of individual variable annuities through banks in
1999 and 1998, according to Kenneth Kehrer and Associates.

The Company's total account value related to individual annuity products was
$89.0 billion as of December 31, 1999. Of this total account value, $80.6
billion, or 91%, related to individual variable annuity products and $8.4
billion, or 9%, related primarily to fixed MVA annuity products.

Hartford Life is also beginning to emerge as a significant participant in the
retail mutual fund business. The Company, with sales of $3.3 billion in 1999,
surpassed $6 billion in assets under management in December 1999. According to
Strategic Insight, this made The Hartford Mutual Funds the first retail-oriented
fund family in history to reach this level in less than three and a half years.
Also during the year, seven of the twelve funds received Morningstar ratings
and, as of December 31, 1999, all seven have three-, four- or five-star ratings.

The Company is among the top providers of retirement products and services,
including asset management and plan administration, to municipalities pursuant
to Section 457 and plans to corporations under Section 401(k) of the Internal
Revenue Code of 1986, as amended (herein after referred to as "Section 457" and
"Section 401(k)", respectively). The Company presently administers over 2,000
Section 457 plans and over 900 Section 401(k) plans. The Company also provides
structured settlement contracts, terminal funding products and other investment
products such as guaranteed investment contracts (GICs).

Products

Individual Variable Annuities -- Hartford Life earns fees for managing variable
annuity assets and maintaining policyholder accounts, which are based on the
policyholders' account values. The Company uses specified portions of the
periodic premiums of a customer to purchase units in one or more mutual funds,
as directed by the customer, who then assumes the investment performance risks
and rewards. As a result, variable annuities permit policyholders to choose
aggressive or conservative investment strategies as they deem appropriate
without affecting the composition and quality of assets in the Company's general
account. These products offer the policyholder a variety of equity and fixed
income options, as well as the ability to earn a guaranteed rate of interest in
the general account of the Company. The Company offers an enhanced guaranteed
rate of interest for a specified period of time (no longer than twelve months)
if the policyholder elects to dollar-cost average (DCA) funds from the Company's
general account into one or more non-guaranteed separate accounts. Due to this
enhanced rate and the volatility experienced in the overall equity markets, this
option has become very popular with policyholders. Deposits of varying amounts
may be made at regular or irregular intervals and the value of these assets
fluctuates in accordance with the investment performance of the funds selected
by the policyholder. To encourage persistency, many of the Company's individual
variable annuities are subject to withdrawal restrictions and surrender charges
ranging initially from 6% to 7% of the contract's face amount which reduce to
zero on a sliding scale, usually within seven policy years. Volatility
experienced by the equity markets in 1998 and 1999 did not cause a significant
increase in variable annuity surrenders, demonstrating that policyholders are
aware of the long-term nature of these products. Individual variable annuity
account value of $80.6 billion as of December 31, 1999, has grown significantly
from $13.1 billion as of December 31, 1994 due to strong net cash flow, the
result of a high level of sales and low levels of surrenders, coupled with
equity market appreciation in both the equity and fixed income allocations of
the policyholders' account value. Approximately 86% of the individual variable
annuity account value was held in non-guaranteed separate accounts as of
December 31, 1999.

The assets underlying the Company's variable annuities are managed both
internally and by outside money managers, while the Company provides all policy
administration services. The Company utilizes a select group of money managers,
such as Wellington Management Company, LLP (Wellington), Putnam Financial
Services, Inc. (Putnam), American Funds, MFS Investment Management (MFS),
Franklin Templeton Group and Morgan Stanley Dean Witter InterCapital, Inc. All
have an interest in the continued growth in sales of the Company's products and
greatly enhance the marketability of the Company's annuities and the

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strength of its product offerings. Two of the industry's top ten leading
variable annuities, The Director and Putnam Hartford Capital Manager Variable
Annuity (based on sales for the year ended 1999) are sponsored by Hartford Life
and are managed in part by Wellington and Putnam, respectively. In July 1999,
the Company introduced Hartford Leaders, a new multi-manager variable annuity.
This new venture combines the product manufacturing, wholesaling and service
capabilities of Hartford Life with the investment management expertise of three
of the nation's most successful investment management organizations, American
Funds, Franklin Templeton Group and MFS. Hartford Life created a separate
division at PLANCO to wholesale the product in order to ensure that the Company
fully capitalizes on this immense opportunity and, by the end of 1999, the
Company had in place a team of over 30 wholesalers. In a matter of six months,
sales of Hartford Leaders have already reached a $1 billion annualized sales
rate, placing this venture as one of the most successful new product launches in
the history of the variable annuity industry.

Fixed MVA Annuities -- Fixed MVA annuities are fixed rate annuity contracts
which guarantee a specific sum of money to be paid in the future, either as a
lump sum or as monthly income. In the event that a policyholder surrenders a
policy prior to the end of the guarantee period, the MVA feature increases or
decreases the cash surrender value of the annuity in respect of any interest
rate decreases or increases, respectively, thereby protecting the Company from
losses due to higher interest rates at the time of surrender. The amount of
payment will not fluctuate due to adverse changes in the Company's investment
return, mortality experience or expenses. The Company's primary fixed MVA
annuities have terms varying from one to ten years with an average term of
approximately seven years. Sales of the Company's fixed MVA annuities increased
during 1999 as a result of a higher interest rate environment making 1999 the
best sales year for this product since 1995. Account values of fixed MVA
annuities were $8.4 billion and $8.6 billion as of December 31, 1999 and 1998,
respectively.

Mutual Funds -- In September 1996, the Company launched a new family of retail
mutual funds. In its fourth year of existence, the Company's family of
non-proprietary mutual funds was designated the fastest growing in United States
history according to a 1999 report by Strategic Insight, an industry research
organization. Also during the year, seven of the twelve funds received
Morningstar ratings and, as of December 31, 1999, all seven have three-, four-
or five-star ratings. These funds are managed by Wellington and Hartford
Investment Management Company, a wholly owned subsidiary of The Hartford. The
Company has entered into agreements with over 600 financial services firms to
distribute these mutual funds.

Retirement Plans -- With respect to retirement products and services, Section
457 plans comprise approximately 80% of the related account values. These assets
have traditionally been held in the Company's general account, but increasingly,
plan beneficiaries are transferring assets into mutual funds held in separate
accounts. The Company offers a number of different funds, both fixed income and
equity, to the employees in Section 457 plans. Generally, the Company manages
the fixed income funds and certain other outside money managers act as advisors
to the equity funds offered in Section 457 plans administered by the Company.
The Company also sells Section 401(k) products targeting the small and medium
case markets since the Company believes these markets are underpenetrated in
comparison to the large case market.

Institutional Liabilities -- Hartford Life also sells structured settlement
contracts which provide for periodic payments to an injured person or survivor
for a generally determinable number of years, typically in settlement of a claim
under a liability policy in lieu of a lump sum settlement. The Company's
structured settlements are sold through The Hartford's property-casualty
insurance operations as well as specialty brokers. The Company also markets
other annuity contracts for special purposes such as the funding of terminated
defined benefit pension plans. In addition, the Company offers GICs and short
term funding agreements.

Marketing and Distribution

The Investment Products distribution network has been developed based on
management's strategy of utilizing multiple and competing distribution channels
in an effort to achieve the broadest distribution to reach target customers. The
success of the Company's marketing and distribution system depends on its
product offerings, fund performance, successful utilization of wholesaling
organizations, relationships with national and regional broker-dealer firms,
banks and other financial institutions, and independent financial advisors
(through which the sale of the Company's individual annuities to customers is
consummated) and quality of customer service.

Hartford Life maintains a network of approximately 1,500 broker-dealers and
approximately 500 banks, including 24 of the 25 largest retail banks in the
United States. The Company periodically negotiates provisions and terms of its
relationships with unaffiliated parties and there can be no assurance that such
terms will remain acceptable to the Company or such third parties. In August
1998, the Company completed the purchase of all outstanding shares of PLANCO, a
primary wholesaler of the Company's individual annuities and mutual funds.
PLANCO is the nation's largest wholesaler of individual annuities and has played
a significant role in Hartford Life's growth over the past decade. As a
wholesaler, PLANCO distributes Hartford Life's fixed and variable annuities,
mutual funds and single premium variable life insurance by providing sales
support to registered representatives, financial planners and broker-dealers at
brokerage firms and banks across the United States. This acquisition secured an
important distribution channel for the Company and gives the Company a wholesale
distribution platform which it can expand in terms of both the number of
individuals wholesaling its products and the portfolio of products in which they
wholesale. In addition, the Company uses internal personnel with

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extensive experience in the Section 457 market, as well as access to the Section
401(k) market, to sell its products and services in the retirement plan market.

Competition

The Investment Products segment competes with numerous other insurance companies
as well as certain banks, securities brokerage firms, investment advisors and
other financial intermediaries marketing annuities, mutual funds and other
retirement-oriented products. As the industry continues to consolidate, some of
these companies have or will gain greater financial strength and resources than
Hartford Life. In particular, national banks may become more significant
competitors in the future for insurers who sell annuities as a result of court
decisions and recent regulatory actions. Passage in November 1999 of the
Gramm-Leach-Bliley Act (the Financial Services Modernization Act), which permits
affiliations among banks, securities firms and insurance companies, may have
competitive, operational and other implications to the Company. (For additional
information, see the Regulatory Matters and Contingencies section of the MD&A.)
Product sales are affected by competitive factors such as investment performance
ratings, product design, visibility in the marketplace, financial strength
ratings, distribution capabilities, levels of charges and credited rates,
reputation and customer service.

INDIVIDUAL LIFE

The Individual Life segment, which focuses on the high end estate and business
planning markets, sells a variety of products including variable life, universal
life, interest sensitive whole life and term life insurance. Life insurance in
force increased 9% to $66.7 billion as of December 31, 1999 from $61.1 billion
as of December 31, 1998. Account values grew 20% to $5.4 billion as of December
31, 1999 from $4.5 billion as of December 31, 1998. The Individual Life segment
generated revenues of $584 and $567 in 1999 and 1998, respectively. Net income
in the Individual Life segment was $71 in 1999, a 9% increase over 1998.

Products

The trend in the individual life industry has been a shift away from traditional
products and fixed universal life insurance towards variable life (including
variable universal life) insurance products. Hartford Life has been on the
leading edge of this industry trend and is a top ten writer of new variable life
sales according to Tillinghast-Towers Perrin. In 1999, of the Company's new
sales of individual life insurance, 84% was variable life and 13% was either
universal life or interest sensitive whole life. The Company also sold a small
amount of term life insurance.

Variable Life -- Variable life insurance provides a return linked to an
underlying investment portfolio and the Company allows policyholders to
determine their desired asset mix among a variety of underlying mutual funds. As
the return on the investment portfolio increases or decreases, as the case may
be, the death benefit or surrender value of the variable life policy may
increase or decrease. The Company's single premium variable life product
provides a death benefit to the policy beneficiary based on a single premium
deposit. The Company's second-to-die products are distinguished from other
products in that two lives are insured rather than one, and the policy proceeds
are paid upon the second death of the two insureds. Second-to-die policies are
frequently used in estate planning, often to fund estate taxes for a married
couple. Variable life account values were $2.6 billion and $1.7 billion as of
December 31, 1999 and 1998, respectively.

Universal Life and Interest Sensitive Whole Life -- Universal life and interest
sensitive whole life insurance coverages provide life insurance with adjustable
rates of return based on current interest rates. The Company offers both
flexible and fixed premium policies and provides policyholders with flexibility
in the available coverage, the timing and amount of premium payments and the
amount of the death benefit provided there are sufficient policy funds to cover
all policy charges for the coming period. Universal life and interest sensitive
whole life represented 13% of new annualized premium sales of individual life
insurance in 1999. The Company also sells universal life insurance policies with
a second-to-die feature similar to that of the variable life insurance product
offered. Universal life and interest sensitive whole life account values were
$2.0 billion as of December 31, 1999 and 1998.

Marketing and Distribution

Consistent with the Company's strategy to access multiple distribution outlets,
the Individual Life distribution organization has been developed to penetrate a
multitude of retail sales channels. These include independent life insurance
sales professionals; agents of other companies; national, regional and
independent broker-dealers; banks and property-casualty insurance organizations.
The primary organization used to wholesale Hartford Life's products to these
outlets is a group of highly qualified life insurance professionals with
specialized training in sophisticated life insurance sales, particularly as it
pertains to estate and business planning. These individuals are generally
employees of Hartford Life, who are managed through a regional sales office
system. The Company has grown this organization rapidly the past few years, to
over 180 individuals, and expects to continue to increase the number of
wholesalers in the future.





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Competition

The Individual Life segment competes with approximately 1,600 life insurance
companies in the United States, as well as other financial intermediaries
marketing insurance products. Competitive factors related to this segment are
primarily the breadth and quality of life insurance products offered,
competitiveness of pricing, relationships with third-party distributors and the
quality of underwriting and customer service.

EMPLOYEE BENEFITS

The Employee Benefits segment primarily sells group life and group disability
insurance, as well as other products, including stop loss and supplementary
medical coverage to employers and employer sponsored plans, accidental death and
dismemberment, travel accident, long-term care insurance and other special risk
coverages to employers and associations. The Company also offers disability
underwriting, administration, claims processing services and reinsurance to
other insurers and self-funded employer plans. According to the latest results
published by Life Insurance Marketing and Research Association (LIMRA), the
Company, based on sales, was the third largest provider of group disability
insurance and the fourth largest writer of group life insurance in the United
States for the nine months ended September 30, 1999. Generally, policies sold in
this segment are term insurance, typically with one or two year rate guarantees.
This allows the Company to make adjustments in rate or terms of its policies in
order to minimize the adverse effect of various market trends. In the disability
market, the Company focuses on strong underwriting and claims management to
derive a competitive advantage. Employee Benefits generated premiums of $1.8
billion in 1999 of which $716 was attributable to group disability coverage and
$614 was attributable to group life coverage. As of December 31, 1999, the
Company's Consolidated Balance Sheet included disability reserves of $1.8
billion and group life reserves of $560. The Employee Benefits segment generated
revenues of $2.0 billion and $1.8 billion in 1999 and 1998, respectively. Net
income in the Employee Benefits segment was $79 in 1999, an 11% increase over
1998.

Products

Group Disability -- Hartford Life is one of the largest participants in the
"large case" market of the group disability insurance business. The large case
market, as defined by the Company, generally consists of group disability
policies covering over 1,000 employees in a particular company. The Company is
continuing to expand its operations in the "small" and "medium case" group
markets, emphasizing name recognition and reputation as well as the Company's
managed disability approach to claims and administration. The Company's efforts
in the group disability market focus on early intervention, return-to-work
programs, reduction of long-term disability claims and successful
rehabilitation. The focus of new disability products introduced is to provide
incentives for employees to return to independence. The Company also works with
disability claimants to improve the receipt rate of Social Security offsets
(i.e., reducing payment of benefits by the amount of Social Security payments
received).

Hartford Life has concentrated on a managed disability approach, which
emphasizes early claimant intervention in an effort to facilitate a disabled
claimant's return to work and thereby contain costs. This approach, coupled with
an individualized approach to claim servicing, and an incentive to contain
costs, leads to an overall reduction in the cost of disability coverage for
employers. The Company's short-term disability benefit plans provide a weekly
benefit amount (typically 60% to 70% of the employee's earned income up to a
specified maximum benefit) to insured employees when they are unable to work due
to an accident or illness. Long-term disability insurance provides a monthly
benefit for those periods of time not covered by a short-term disability
benefits plan when insured employees are unable to work due to disability.
Employees may receive total or partial disability benefits. Most of these
policies usually begin providing benefits following a 90 or 180 day waiting
period and continue providing benefits until the employee reaches age 65-70.
Long-term disability benefits are paid monthly and are limited to a portion,
generally 50-70%, of the employee's earned income up to a specified maximum
benefit.

Group Life -- Group term life insurance provides term coverage to employees and
their dependents for a specified period and has no accumulation of cash values.
The Company offers innovative options for its basic group life insurance
coverage, including portability of coverage and a living benefit option, whereby
terminally ill policyholders can receive death benefits prior to their death. In
addition, the Company offers employee groups accidental death and dismemberment
coverage.

Other -- Hartford Life also provides long-term care, travel accident, hospital
indemnity, Medicare Supplement and other coverages (including group life and
disability) primarily to individual members of various associations as well as
employee groups. The Company provides excess of loss medical coverage (known as
"stop loss" insurance) to employers who self-fund their medical plans and pay
claims using the services of a third party administrator.

Marketing and Distribution

Hartford Life uses an experienced group of Company employees, managed through a
regional sales office system, to distribute its group insurance products and
services through a variety of distribution outlets. The Company expanded its
sales office system during 1999, by increasing both the sales force and the
number of sales offices by about 25% and 15%, respectively. The Company will

                                       8
<PAGE>   9
continue to expand the system over the coming years in areas that have the
highest growth potential in terms of small and large business growth. The
Company sells its product line to employers through brokers, consultants and
third-party administrators as well as to multiple employer groups through its
relationships with trade associations.

Competition

Competitive factors primarily affecting Employee Benefits are the variety and
quality of products offered, the price quoted for coverage and services, the
Company's relationships with its third-party distributors and the quality of
customer service. Employee Benefits competes with numerous other insurance
companies and other financial intermediaries marketing insurance products.
However, many of these businesses have relatively high barriers to entry and
there have been very few new entrants over the past few years, while other major
carriers have exited the market.

CORPORATE OWNED LIFE INSURANCE (COLI)

Hartford Life is a leader in the COLI market, which includes life insurance
policies purchased by a company on the lives of its employees, with the company
named as the beneficiary under the policy. Until the Health Insurance
Portability Act of 1996 (HIPA Act of 1996), the Company sold two principal types
of COLI, leveraged and variable products. Leveraged COLI is a fixed premium life
insurance policy owned by a company or a trust sponsored by a company. The HIPA
Act of 1996 phased out the deductibility of interest on policy loans under
leveraged COLI at the end of 1998, thus virtually eliminating all future sales
of leveraged COLI. Variable COLI continues to be a product used by employers to
fund non-qualified benefits or other postemployment benefit liabilities.
Products marketed in this segment also include coverage owned by employees under
business sold through corporate sponsorship. Variable COLI account values were
$12.4 billion and $11.2 billion as of December 31, 1999 and 1998, respectively.

In November 1998, Hartford Life recaptured an in force block of leveraged COLI
business from MBL Life Assurance Co. of New Jersey (MBL Life). The transaction
was consummated through the assignment of a reinsurance arrangement between
Hartford Life and MBL Life to a Hartford Life subsidiary. Hartford Life
originally assumed the life insurance block in 1992 from Mutual Benefit Life
Insurance Company (Mutual Benefit Life), which was placed in court-supervised
rehabilitation in 1991, and reinsured a portion of those policies back to MBL
Life. MBL Life, previously a Mutual Benefit Life subsidiary, operates under the
Rehabilitation Plan for Mutual Benefit Life. The recaptured MBL business
increased revenues and expenses for 1998, however, there was no impact to net
income. Leveraged COLI account values decreased to $5.7 billion as of December
31, 1999 from $9.2 billion as of December 31, 1998, primarily due to the HIPA
Act of 1996. Although COLI revenues decreased in 1999 to $831 from $1,567 in
1998, COLI earnings increased 25%, to $30 in 1999.

OTHER MATTERS

RESERVES

In accordance with applicable insurance regulations under which Hartford Life
operates, life insurance subsidiaries of the Company establish and carry as
liabilities actuarially determined reserves which are calculated to meet
Hartford Life's future obligations. Reserves for life insurance and disability
contracts are based on actuarially recognized methods using prescribed morbidity
and mortality tables in general use in the United States, which are modified to
reflect Hartford Life's actual experience when appropriate. These reserves are
computed at amounts that, with additions from estimated premiums to be received
and with interest on such reserves compounded annually at certain assumed rates,
are expected to be sufficient to meet the Company's policy obligations at their
maturities or in the event of an insured's death. Reserves also include unearned
premiums, premium deposits, claims incurred but not reported and claims reported
but not yet paid. Reserves for assumed reinsurance are computed on bases
essentially comparable to direct insurance reserves.

For Hartford Life's universal life and interest sensitive whole life policies,
reserves are set according to premiums collected, plus interest credited, less
charges. Other fixed death benefit and individual life reserves are based on
assumed investment yield, persistency, mortality and morbidity as per commonly
used actuarial tables, expenses and margins for adverse deviations. For the
Company's group disability policies, the level of reserves is based on a variety
of factors including particular diagnoses, termination rates and benefit
payments.

The persistency of Hartford Life's annuity and other interest sensitive life
insurance reserves is enhanced by policy restrictions on the withdrawal of
funds. Withdrawals in excess of allowable penalty-free amounts are assessed a
surrender charge during a penalty period, which is usually at least seven years.
Such surrender charge is initially a percentage of the accumulation value, which
varies by product, and generally decreases gradually during the penalty period.
Surrender charges are set at levels to protect the Company from loss on early
terminations and to reduce the likelihood of policyholders terminating their
policies during periods of increasing interest rates, thereby lengthening the
effective duration of policy liabilities and improving the Company's ability to
maintain profitability on such policies.


                                       9
<PAGE>   10
Hartford Life's reserves comply, in all material respects, with state insurance
department statutory accounting practices; however, in the Company's
Consolidated Financial Statements, life insurance reserves are determined in
accordance with generally accepted accounting principles, which may vary from
statutory accounting practices.

REGULATION AND PREMIUM RATES

Insurance companies are subject to comprehensive and detailed regulation and
supervision throughout the United States. The extent of such regulation varies,
but generally has its source in statutes which delegate regulatory, supervisory
and administrative powers to state insurance departments. Such powers relate to,
among other things, the standards of solvency which must be met and maintained;
the licensing of insurers and their agents; the nature of and limitations on
investments; premium rates; claim handling and trade practices; restrictions on
the size of risks which may be insured under a single policy; deposits of
securities for the benefit of policyholders; approval of policy forms; periodic
examinations of the affairs of companies; annual and other reports required to
be filed on the financial condition of companies or for other purposes; fixing
maximum interest rates on life insurance policy loans and minimum rates for
accumulation of surrender values; and, the adequacy of reserves and other
necessary provisions for unearned premiums, unpaid claims and claim adjustment
expenses and other liabilities, both reported and unreported.

Most states have enacted legislation which regulates insurance holding company
systems such as Hartford Life. This legislation provides that each insurance
company in the system is required to register with the insurance department of
its state of domicile and furnish information concerning the operations of
companies within the holding company system which may materially affect the
operations, management or financial condition of the insurers within the system.
All transactions within a holding company system affecting insurers must be fair
and equitable. Notice to the insurance departments is required prior to the
consummation of transactions affecting the ownership or control of an insurer
and of certain material transactions between an insurer and any entity in its
holding company system. In addition, certain of such transactions cannot be
consummated without the applicable insurance department's prior approval.

REINSURANCE

In accordance with normal industry practice, Hartford Life is involved in both
the cession and assumption of insurance with other insurance and reinsurance
companies. As of December 31, 1999, the maximum amount of life insurance
retained on any one life by any of the life operations is approximately $2.5,
excluding accidental death benefits.

INVESTMENT OPERATIONS

The Company's investment operations are managed by its investment strategy group
which reports directly to senior management of the Company. Hartford Life's
investments have been separated into specific portfolios which support specific
classes of product liabilities. The investment strategy group works closely with
the product lines to develop investment guidelines, including duration targets,
asset allocation and convexity constraints, asset/liability mismatch tolerances
and return objectives, to ensure that the product line's individual risk and
return objectives are met. The Company's primary investment objective for its
general account and guaranteed separate accounts is to maximize after-tax
returns consistent with acceptable risk parameters, including the management of
the interest rate sensitivity of invested assets to that of policyholder
obligations.

For further discussion of Hartford Life's investment operations and the
Company's approach to managing investment risk, see the Investments section and
the Capital Markets Risk Management section of the MD&A, as well as Notes 2(f),
2(g), 2(h) and 4 of Notes to Consolidated Financial Statements.


RATINGS

Reference is made to the Capital Resources and Liquidity section of the MD&A
under "Ratings".

RISK-BASED CAPITAL

Reference is made to the Capital Resources and Liquidity section of the MD&A
under "Risk-Based Capital".

LEGISLATIVE AND REGULATORY INITIATIVES

Reference is made to the Regulatory Matters and Contingencies section of the
MD&A under "Legislative and Regulatory Initiatives".

INSOLVENCY FUND

Reference is made to the Regulatory Matters and Contingencies section of the
MD&A under "Insolvency Fund".


                                       10
<PAGE>   11
NAIC PROPOSALS

Reference is made to the Regulatory Matters and Contingencies section of the
MD&A under "NAIC Proposals".

DEPENDENCE ON CERTAIN THIRD PARTY RELATIONSHIPS

Reference is made to the Regulatory Matters and Contingencies section of the
MD&A under "Dependence on Certain Third Party Relationships".

YEAR 2000

Reference is made to the Regulatory Matters and Contingencies section of the
MD&A under "Year 2000".

EMPLOYEES

Hartford Life had approximately 5,000 employees at February 29, 2000.

EXECUTIVE OFFICERS OF HARTFORD LIFE

Information about the executive officers of Hartford Life who are also directors
and/or nominees for election as directors is set forth in Hartford Life's 2000
Proxy Statement. In addition to those executive officers who are listed in the
2000 Proxy Statement, listed below are other Company executive officers:

GREGORY A. BOYKO, 48, is Senior Vice President and Director of the Company's
international operations since November 1997. He joined Hartford Life in 1995 as
Controller. In 1996, he became the Company's Chief Financial Officer and
Treasurer, which position he held until August 1998. He previously worked at ING
America Life Insurance Company where he held the position of Senior Vice
President and Chief Financial Officer. His prior experience included positions
at Connecticut Mutual Life Insurance Company (CML), where he progressed from
Controller of CML to Chief Financial Officer of Connecticut Mutual Insurance
Services. Mr. Boyko holds a Juris Doctor degree and is a Certified Public
Accountant, Chartered Life Underwriter and Chartered Financial Consultant. He is
a member of the Connecticut and American Bar Associations and the Connecticut
Society of Certified Public Accountants.

DAVID T. FOY, 33, is Senior Vice President and Chief Financial Officer. Mr. Foy
was appointed to his current position in August 1998 and was given the title of
Chief Financial Officer in October 1999. He joined Hartford Life in 1993 in the
individual annuity product management area and assumed the position of Director
of Strategic Planning in 1995. He was promoted to Assistant Vice President and
Director of Finance in 1997. He began his career in 1989 at Milliman &
Robertson, an actuarial consulting firm. He is a Fellow of the Society of
Actuaries and a member of the American Academy of Actuaries.

LYNDA GODKIN, 45, is Senior Vice President and General Counsel. She joined
Hartford Life in 1990 as Counsel for the Employee Benefits Segment. In 1994 she
was named Assistant General Counsel and Director of Hartford Life's Law
Department. In 1996 she was named General Counsel of Hartford Life. She
previously practiced law at CIGNA Corporation. She began her legal career in
1981 at the law firm of Day, Berry & Howard in Hartford, Connecticut.
She is a member of the Connecticut and American Bar Associations.

JOHN C. WALTERS, 38 , will join Hartford Life in April 2000 as Executive Vice
President and Director of Investment Products. Previously, Mr. Walters was
President of the Financial Services Group of First Union Securities (First
Union) and its predecessors since 1996. He joined First Union through its 1998
acquisition of Wheat First Butcher Singer, where he had been since 1984 and held
positions of increasing responsibilities, including Managing Director, Financial
Services from 1992 to 1994 and Director of Sales from 1994 to 1996.

RAYMOND P. WELNICKI, 51, is Senior Vice President and heads the Strategic
Operations Unit since February 1999. He joined Hartford Life in 1992 as Actuary,
Director of Group Actuarial and Long-Term Care. He was named Vice President of
Hartford Life in 1993. He served as Senior Vice President and Director of
Employee Benefits from 1994 to 1999. Prior to 1992, he was employed with Aetna
Life & Casualty Company as Assistant Vice President, Issues and Strategic
Management. He is a Fellow of the Society of Actuaries.

LIZABETH H. ZLATKUS, 41, is Executive Vice President and Director of Employee
Benefits since March 2000. Ms. Zlatkus has held positions of increasing
responsibility since joining The Hartford in 1983. She was named Senior Vice
President and Director of Employee Benefits Division in 1999 and served as
Senior Vice President and Director of Group Life and Disability from 1997 to
1999. Prior to that time, she served as Vice President and Director of Risk
Management and Business Operations. She began her career at Peat, Marwick,
Mitchell & Company. She became a Certified Public Accountant in 1982.

DAVID M. ZNAMIEROWSKI, 39, is Senior Vice President and Chief Investment
Officer. Mr. Znamierowski was appointed to his current position in October 1999.
Mr. Znamierowski joined Hartford Life in 1996 as Director of Risk Management.
Previously, he held various positions with Aetna Life & Casualty Company,
including Vice President, Investment Strategy and Policy. From 1986 through
1991, Mr. Znamierowski held positions with Salomon Brothers Inc.





                                       11
<PAGE>   12
ITEM 2.  PROPERTIES

Hartford Life's principal executive offices are located in Simsbury,
Connecticut. The Company's home office complex consists of approximately 615
thousand square feet, and is leased from a third party by Hartford Fire
Insurance Company (Hartford Fire), an indirect subsidiary of The Hartford. This
lease expires in the year 2009. Expenses associated with these offices are
allocated on a direct and indirect basis to Hartford Life by Hartford Fire.

ITEM 3.  LEGAL PROCEEDINGS

Hartford Life is involved in pending and threatened litigation in the normal
course of its business in which claims for alleged economic and punitive damages
have been asserted. Some of these cases have been filed as purported class
actions and some cases have been filed in certain jurisdictions that permit
punitive damage awards disproportionate to the actual damages incurred. Although
there can be no assurances, at the present time the Company does not anticipate
that the ultimate liability arising from such pending or threatened litigation,
after consideration of provisions made for estimated losses and costs of
defense, will have a material adverse effect on the financial condition or
operating results of the Company.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

No matter was submitted to a vote of security holders of Hartford Life during
the fourth quarter of the fiscal year covered by this report.


PART II

ITEM 5.  MARKET FOR HARTFORD LIFE'S COMMON STOCK AND RELATED STOCKHOLDER MATTERS

Hartford Life's Class A Common Stock is traded on the New York Stock Exchange
(NYSE) under the trading symbol "HLI". Hartford Life's Class B Common Stock is
held by Hartford Accident and Indemnity Company (HA&I), an indirect wholly-owned
subsidiary of The Hartford. As such, the Class B Common Stock is not listed on
any exchange and there is no established public trading market for it.

The following table presents high and low closing prices for the Class A Common
Stock of Hartford Life on the NYSE for the periods indicated, and the quarterly
dividends declared per share on Class A and Class B Common Stock:

<TABLE>
<CAPTION>
                                                           1999                                             1998
                                       ---------------------------------------------    --------------------------------------------
                                       1st Qtr.    2nd Qtr.   3rd Qtr.    4th Qtr.      1st Qtr.   2nd Qtr.    3rd Qtr.    4th Qtr.
  ----------------------------------------------------------------------------------------------------------------------------------
  Common Stock Price
<S>                                     <C>          <C>        <C>        <C>           <C>         <C>         <C>        <C>
     High                               $59.38       $55.00     $53.25     $54.50        $50.00      $56.94      $62.19     $58.38
     Low                                $50.25       $45.63     $42.38     $37.63        $40.00      $46.75      $42.25     $33.88
  Dividends Declared                     $0.09        $0.09      $0.09      $0.09         $0.09       $0.09       $0.09      $0.09
  ----------------------------------------------------------------------------------------------------------------------------------
</TABLE>



As of February 29, 2000, there were approximately 600 shareholders of record of
Hartford Life's Class A Common Stock and HA&I was the only holder of Class B
Common Stock.

On February 17, 2000, Hartford Life's Board of Directors approved an 11%
increase in the quarterly dividend to $0.10 per share, payable on April 3, 2000
to stockholders of record on March 1, 2000. Future dividend decisions will be
based on, and affected by, a number of factors, including the operating results
and financial requirements of Hartford Life on a stand-alone basis and the
impact of regulatory restrictions discussed in the Capital Resources and
Liquidity section of the Management's Discussion and Analysis of Financial
Condition and Results of Operations (MD&A) under "Liquidity Requirements".

There are also various legal limitations governing the extent to which Hartford
Life's insurance subsidiaries may pay dividends, extend credit or otherwise
provide funds to Hartford Life, Inc. as discussed in the Capital Resources and
Liquidity section of the MD&A under "Liquidity Requirements".




                                       12
<PAGE>   13
ITEM 6.  SELECTED FINANCIAL DATA


<TABLE>
<CAPTION>
(In millions, except for per share data)                       1999           1998          1997           1996           1995
------------------------------------------------------------------------------------------------------------------------------------
BALANCE SHEET DATA (1)
<S>                                                       <C>            <C>            <C>           <C>            <C>
General account invested assets                             $ 21,786       $ 24,882       $ 20,970      $  19,830      $   20,072
Separate account assets (2)                                  110,652         90,628         69,362         49,770          36,296
All other assets                                               6,595          6,512         10,648         10,333           9,594
------------------------------------------------------------------------------------------------------------------------------------
    TOTAL ASSETS                                            $139,033       $122,022       $100,980      $  79,933      $   65,962
------------------------------------------------------------------------------------------------------------------------------------

Policy liabilities                                          $ 23,109       $ 25,484       $ 26,078      $  26,239      $   26,318
Separate account liabilities (2)                             110,652         90,628         69,362         49,770          36,296
Allocated advances from parent (3)                                --             --             --            893             732
Debt (3)                                                         650            650            700             --             --
Company obligated mandatorily redeemable preferred
   securities of subsidiary trust holding solely parent
   junior subordinated debentures (4)                            250            250             --             --             --
All other liabilities                                          2,066          2,517          2,696          1,757           1,439
------------------------------------------------------------------------------------------------------------------------------------
    TOTAL LIABILITIES                                       $136,727       $119,529       $ 98,836      $  78,659      $   64,785
------------------------------------------------------------------------------------------------------------------------------------
    TOTAL STOCKHOLDERS' EQUITY                              $  2,306       $  2,493       $  2,144      $   1,274      $    1,177
------------------------------------------------------------------------------------------------------------------------------------
INCOME STATEMENT DATA (1)
Total revenues                                              $  5,536       $  5,788       $  4,699      $    4,384     $    4,090
Total expenses                                                 5,069          5,402          4,393           4,360          3,940
------------------------------------------------------------------------------------------------------------------------------------
    NET INCOME (5)                                          $    467       $    386       $    306      $       24     $      150
------------------------------------------------------------------------------------------------------------------------------------
EARNINGS PER SHARE DATA
Basic earnings per share (6)                                $   3.34       $    2.76      $   2.28      $    0.19      $      --
Diluted earnings per share (6)                              $   3.33       $    2.75      $   2.28      $    0.19      $      --
Dividends declared per common share (7)                     $   0.36       $    0.36      $   0.18      $      --      $      --
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>

(1)On November 10, 1998, the Company recaptured an in force block of corporate
   owned life insurance (COLI) business from MBL Life Assurance Co. of New
   Jersey (MBL Life). For additional information, see the COLI section as well
   as the MBL Recapture discussion under "Purchases of Affiliates and Other"
   within the Capital Resources and Liquidity section of the Management's
   Discussion and Analysis of Financial Condition and Results of Operations
   (MD&A).

(2)Includes both non-guaranteed and guaranteed separate accounts.

(3)For financial reporting purposes, the Company has treated certain amounts
   previously allocated by The Hartford Financial Services Group, Inc. (The
   Hartford) to the Company's life insurance subsidiaries as allocated advances
   from parent. Cash received in respect of allocated advances from parent was
   used to support the growth of the life insurance subsidiaries.

(4)On June 29, 1998, Hartford Life Capital I, a special purpose Delaware trust
   formed by Hartford Life, issued 10,000,000, 7.2% Trust Preferred Securities,
   Series A (Series A Preferred Securities). The proceeds from the sale of the
   Series A Preferred Securities were used to acquire $250 of 7.2% Series A
   Junior Subordinated Deferrable Interest Debentures (Junior Subordinated
   Debentures) issued by Hartford Life. For additional
   information, see Note 8 of Notes to Consolidated Financial Statements.

(5)1996 includes realized losses of $225 primarily resulting from actions taken
   in the third quarter of 1996 related to the Company's guaranteed investment
   contract business.

(6)Pro forma effect on basic and diluted earnings per share has been given for
   the 1997 and 1996 periods presented for the conversion of 1,000 shares of
   common stock into 114 million shares of Class B Common Stock, which occurred
   on April 3, 1997, prior to the Company's initial public offering (IPO). For
   information regarding the IPO and earnings per share data, see Notes 3 and 10
   of Notes to Consolidated Financial Statements, respectively.

(7)Dividends per common share represent amounts declared subsequent to the
   Company's IPO on May 22, 1997. (For information regarding the IPO, see Note 3
   of Notes to Consolidated Financial Statements.) The table does not include
   dividends paid to the parent in periods prior to the IPO.


                                       13
<PAGE>   14
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS

(Dollar amounts in millions, except for share data, unless otherwise stated)

Management's Discussion and Analysis of Financial Condition and Results of
Operations should be read in conjunction with the Consolidated Financial
Statements and related Notes beginning on page F-1.

Certain statements contained in this discussion, other than statements of
historical fact, are forward-looking statements. These statements are made
pursuant to the safe harbor provisions of the Private Securities Litigation
Reform Act of 1995 and include estimates and assumptions related to economic,
competitive and legislative developments. These forward-looking statements are
subject to change and uncertainty which are, in many instances, beyond the
Company's control and have been made based upon management's expectations and
beliefs concerning future developments and their potential effect on Hartford
Life, Inc. and subsidiaries ("Hartford Life" or the "Company"). There can be no
assurance that future developments will be in accordance with management's
expectations or that the effect of future developments on Hartford Life will be
those anticipated by management. Actual results could differ materially from
those expected by the Company, depending on the outcome of certain factors,
including the possibility of general economic, business and legislative
conditions that are less favorable than anticipated, changes in interest rates
or the stock markets, stronger than anticipated competitive activity and those
described in the forward-looking statements.

Certain reclassifications have been made to prior year financial information to
conform to the current year presentation.


INDEX

Consolidated Results of Operations           14
Investment Products                          16
Individual Life                              17
Employee Benefits                            18
Corporate Owned Life Insurance (COLI)        19
Reserves                                     20
Investments                                  20
Capital Markets Risk Management              22
Capital Resources and Liquidity              30
Regulatory Matters and Contingencies         33
Effect of Inflation                          35
Accounting Standards                         35


CONSOLIDATED RESULTS OF OPERATIONS

Hartford Life is a leading financial services and insurance company providing
investment and retirement products such as variable and fixed annuities, mutual
funds and retirement plan services; individual and corporate owned life
insurance; and, employee benefit products such as group life and disability
insurance.

The Company derives its revenues principally from: (a) asset management fees on
separate account and mutual fund assets and mortality and expense fees; (b)
fully insured premiums; (c) cost of insurance charges; (d) net investment income
on general account assets; and (e) certain other fees earned by the Company.
Asset management fees and mortality and expense fees are primarily generated
from separate account assets, which are deposited with the Company through the
sale of variable annuity products and variable life products, and mutual funds.
Premium revenues are derived primarily from the sale of group life and group
disability insurance products. Cost of insurance charges are assessed on the net
amount at risk for investment oriented life insurance products.

Hartford Life's expenses essentially consist of interest credited to
policyholders on general account liabilities, insurance benefits provided,
dividends to policyholders, costs of selling and servicing the various products
offered by the Company, and other general business expenses.

Hartford Life's profitability depends largely on the amount of assets under
management, the level of fully insured premiums, the adequacy of product pricing
and underwriting discipline, and its ability to earn target spreads between
earned investment rates on general account assets and credited rates to
customers.





                                       14
<PAGE>   15



OPERATING SUMMARY

<TABLE>
<CAPTION>
                                                                                 1999            1998            1997
----------------------------------------------------------------------------------------------------------------------------
<S>                                                                            <C>            <C>             <C>
Premiums and other considerations                                              $  3,979       $   3,833       $   3,163
Net investment income                                                             1,562           1,955           1,536
Net realized capital losses                                                          (5)             --              --
----------------------------------------------------------------------------------------------------------------------------
          TOTAL REVENUES                                                          5,536           5,788           4,699
          ------------------------------------------------------------------------------------------------------------------
Benefits, claims and claim adjustment expenses                                    3,054           3,227           2,671
Amortization of deferred policy acquisition costs                                   568             441             345
Dividends to policyholders                                                          104             330             241
Other expenses                                                                    1,124           1,205             962
----------------------------------------------------------------------------------------------------------------------------
          TOTAL BENEFITS, CLAIMS AND EXPENSES                                     4,850           5,203           4,219
          ------------------------------------------------------------------------------------------------------------------

          INCOME BEFORE INCOME TAX EXPENSE                                          686             585             480
Income tax expense                                                                  219             199             174
----------------------------------------------------------------------------------------------------------------------------
          NET INCOME                                                           $    467       $     386       $     306
          ------------------------------------------------------------------------------------------------------------------
</TABLE>

Hartford Life has the following reportable operating segments: Investment
Products, Individual Life, Employee Benefits and Corporate Owned Life Insurance
(COLI). The Company reports corporate items not directly allocable to any of its
segments, principally interest expense, as well as its international operations,
which are primarily located in Latin America, in an "Other" category. For
information regarding the Company's reportable segments, see Note 17 of Notes to
Consolidated Financial Statements.

1999 COMPARED TO 1998 - Revenues decreased $252, or 4%, due primarily to the
declining block of leveraged COLI business. Excluding the COLI segment, revenues
increased $484, or 11%, driven mostly by the Investment Products and Employee
Benefits segments, where revenues increased $257, or 14%, and $215, or 12%,
respectively. The revenue growth in the Investment Products segment was, for the
most part, due to higher fee income in the individual annuity and mutual fund
operations. Combined fee income for these products increased $301, or 33%, to
$1,215 due to significant growth in related assets under management resulting
from strong sales, favorable persistency and equity market appreciation. The
growth in Employee Benefits revenues was fundamentally due to higher premium
revenue generated by persistency of the in force block of business, coupled with
strong sales to new customers.

Total benefits, claims and expenses decreased $353, or 7%, primarily due to the
declining block of leveraged COLI business. Excluding the COLI segment, total
benefits, claims and expenses increased $394, or 11%, consistent with the
revenue growth described above. Net income increased $81, or 21%, driven mostly
by increased fee income associated with higher assets under management in the
Investment Products segment, as well as continued growth across its other
reportable segments.

1998 COMPARED TO 1997 - Revenues increased $1.1 billion, or 23%, essentially due
to the continued growth of revenues in the Investment Products and Individual
Life segments of $274 and $57, respectively. Investment Products and Individual
Life revenues increased as a result of higher assets under management associated
with strong net cash flow and equity market appreciation. Additionally, Employee
Benefits revenues increased $109, or 6%, due to strong sales and favorable
persistency. COLI revenues increased $587 primarily due to the recapture in the
fourth quarter of 1998 of an in force block of COLI business previously ceded to
MBL Life Assurance Co. of New Jersey. (For a discussion of the MBL Recapture,
see the Capital Resources and Liquidity section.)

Total benefits, claims and expenses increased $984, or 23%, principally due to
costs associated with the recaptured MBL business as well as continued growth in
the Company's other reportable segments. Net income increased $80, or 26%, most
notably as a result of an increase in earnings in the Investment Products
segment of $64 and in the Individual Life segment of $9, both of which were
driven by higher fees associated with growth in assets under management.
Additionally, earnings in the Employee Benefits segment increased $13 as group
insurance revenue increased and the Company achieved favorable mortality and
morbidity experience.

OUTLOOK

Management believes that it has developed and implemented strategies to maintain
and enhance its position as a market leader within the financial services
industry, to continue the Company's growth in assets under management and fully
insured premium growth and to maximize shareholder value. Hartford Life is well
positioned to assist individuals in meeting their financial goals as they
increasingly save and plan for retirement, protect themselves and their families
against disability or death and prepare their estates for an efficient transfer
of wealth between generations. Hartford Life's strong market position in its
primary businesses, which align with these growing markets, will provide
opportunities to increase sales of the Company's products and services.

Certain proposed legislative initiatives which could impact Hartford Life are
discussed in the Regulatory Matters and Contingencies section.





                                       15
<PAGE>   16
SEGMENT RESULTS

Below is a summary of net income (loss) by segment.

<TABLE>
<CAPTION>
                                                           1999               1998             1997
---------------------------------------------------------------------------------------------------------
<S>                                                   <C>                <C>              <C>
Investment Products                                   $      330         $      266       $      202
Individual Life                                               71                 65               56
Employee Benefits                                             79                 71               58
Corporate Owned Life Insurance                                30                 24               27
Other                                                        (43)               (40)             (37)
---------------------------------------------------------------------------------------------------------
   NET INCOME                                         $      467         $      386       $      306
---------------------------------------------------------------------------------------------------------
</TABLE>

A description of each segment as well as an analysis of the operating results
summarized above is included on the following pages. Reserves and Investments
are discussed in separate sections.


INVESTMENT PRODUCTS

OPERATING SUMMARY

<TABLE>
<CAPTION>
                                                                       1999               1998               1997
------------------------------------------------------------------------------------------------------------------------
<S>                                                              <C>                <C>                <C>
Premiums and other considerations                                $      1,333       $      1,045       $        771
Net investment income                                                     708                739                739
------------------------------------------------------------------------------------------------------------------------
          TOTAL REVENUES                                                2,041              1,784              1,510
          --------------------------------------------------------------------------------------------------------------
Benefits, claims and claim adjustment expenses                            668                671                677
Amortization of deferred policy acquisition costs                         430                326                250
Other expenses                                                            440                376                269
------------------------------------------------------------------------------------------------------------------------
          TOTAL BENEFITS, CLAIMS AND EXPENSES                           1,538              1,373              1,196
          --------------------------------------------------------------------------------------------------------------

          INCOME BEFORE INCOME TAX EXPENSE                                503                411                314
Income tax expense                                                        173                145                112
------------------------------------------------------------------------------------------------------------------------

          NET INCOME                                             $        330       $        266       $        202
          --------------------------------------------------------------------------------------------------------------
Individual variable annuity account values                       $     80,588       $     62,210       $     46,920
Other individual annuity account values                                 8,383              8,574              9,349
Other investment products account values                               16,352             15,389             14,039
------------------------------------------------------------------------------------------------------------------------
           TOTAL ACCOUNT VALUES                                       105,323             86,173             70,308
Retail mutual fund assets under management                              6,374              2,506                972
------------------------------------------------------------------------------------------------------------------------

           TOTAL INVESTMENT PRODUCTS ASSETS UNDER MANAGEMENT     $    111,697       $     88,679      $      71,280
           -------------------------------------------------------------------------------------------------------------
</TABLE>

The Investment Products segment focuses on the savings and retirement needs of
the growing number of individuals who are preparing for retirement or have
already retired through the sale of individual fixed and variable annuities,
mutual funds, retirement plan services and other investment products. The
Company was ranked the number one writer of individual variable annuities in the
United States for 1999 according to Variable Annuity and Research Data Service
(VARDS) and the number one seller of individual variable annuities through
banks, according to Kenneth Kehrer and Associates. In addition, The Hartford
Mutual Funds became the first retail mutual fund family to surpass $6.0 billion
in assets in less than three and a half years of existence. Also, seven of the
twelve mutual funds received Morningstar ratings and, as of December 31, 1999,
all seven have three-, four- or five-star ratings.

1999 COMPARED TO 1998 - Revenues increased $257, or 14%, primarily due to higher
fee income in the individual annuity and retail mutual fund operations. Fees
generated by individual annuities increased $248, or 29%, as related account
values increased $18.2 billion, or 26%. The growth in individual annuity account
values was mostly due to significant net cash flow, resulting from strong sales
of $10.9 billion and favorable persistency, as well as equity market
appreciation. In addition, fee income from other investment products increased
$68, or 59%, primarily due to the Company's continued growth in its retail
mutual fund operation, where assets under management grew $3.9 billion, or 154%.
This tremendous growth was driven by phenomenal sales of $3.3 billion, favorable
persistency and equity market appreciation.

Associated with continued growth in this segment, total benefits, claims and
expenses increased $165, or 12%. This increase was primarily driven by
amortization of deferred policy acquisition costs, which grew $104, or 32%, and
operating expenses, which increased $32, or 13%, as a result of growth in the
individual annuity and mutual fund operations described above.


                                       16
<PAGE>   17

Net income increased $64, or 24%, for the most part due to the growth in
revenues discussed above. Also contributing to the higher net income were
operating efficiencies that the segment continues to achieve, particularly in
its individual variable annuity operation, where operating expenses as a
percentage of average individual annuity account values decreased from 23 basis
points to 21 basis points.

1998 COMPARED TO 1997 - Revenues increased $274, or 18%, driven primarily by
higher fee income in the individual annuity operation. Individual variable
annuity fee income increased $236, or 38%, as related account values grew $15.3
billion, or 33%. The growth in individual variable annuity account values was
due to significant net cash flow, the result of strong sales of $9.9 billion and
favorable persistency, as well as equity market appreciation. In addition, fee
income from other investment products increased $60, or 107%, most notably the
result of growth in the Company's mutual fund operations, where related assets
under management increased $1.5 billion, or 158%.

Total benefits, claims and expenses increased $177, or 15%, as a result of the
continued growth in this segment. Amortization of deferred policy acquisition
costs grew $76, or 30%, and other expenses increased $107, or 40%, essentially
due to growth in the individual annuity and mutual fund operations discussed
above. The increased revenues associated with the 33% growth in individual
variable annuity account values, coupled with a reduction in individual annuity
operating expenses as a percentage of average individual annuity account values
to 23 basis points from 25 basis points, contributed to the increase in net
income of $64, or 32%.

OUTLOOK

The market for retirement products continues to expand as individuals
increasingly save and plan for retirement. Demographic trends suggest that as
the baby boom generation matures, a significant portion of the United States
population will allocate a greater percentage of their disposable incomes to
saving for their retirement years due to uncertainty surrounding the Social
Security system and increases in average life expectancy. As this market grows,
particularly for variable annuities and mutual funds, new companies are
continually entering the market and aggressively seeking distribution
capabilities and pursuing market share. This trend is not expected to subside,
particularly in light of the Gramm-Leach-Bliley Act of 1999 (the Financial
Services Modernization Act), which was enacted into law, allowing banks,
securities firms and insurance companies to have ownership affiliation. (For
additional information, see the Regulatory Matters and Contingencies section.)

Management believes that it has developed and implemented strategies to maintain
and enhance its position as a market leader in the financial services industry.


INDIVIDUAL LIFE

OPERATING SUMMARY

<TABLE>
<CAPTION>
                                                                          1999             1998                 1997
-------------------------------------------------------------------------------------------------------------------------
<S>                                                                 <C>                <C>               <C>
Premiums and other considerations                                   $         412      $        378      $         339
Net investment income                                                         172               189                171
-------------------------------------------------------------------------------------------------------------------------

          TOTAL REVENUES                                                      584               567                510
          ---------------------------------------------------------------------------------------------------------------
Benefits, claims and claim adjustment expenses                                258               269                251
Amortization of deferred policy acquisition costs                             129               108                 87
Dividends to policyholders and other expenses                                  88                89                 85
-------------------------------------------------------------------------------------------------------------------------
          TOTAL BENEFITS, CLAIMS AND EXPENSES                                 475               466                423
          ---------------------------------------------------------------------------------------------------------------

          INCOME BEFORE INCOME TAX EXPENSE                                    109               101                 87
Income tax expense                                                             38                36                 31
-------------------------------------------------------------------------------------------------------------------------
          NET INCOME                                                $          71      $         65      $          56
          ---------------------------------------------------------------------------------------------------------------


Variable life account values                                        $       2,595      $      1,727      $       1,076
Total account values                                                $       5,419      $      4,512      $       3,791
-------------------------------------------------------------------------------------------------------------------------

Variable life insurance in force                                    $      23,854      $     16,305      $       9,750
Total life insurance in force                                       $      66,690      $     61,074      $      55,441
-------------------------------------------------------------------------------------------------------------------------
</TABLE>

The Individual Life segment, which focuses on the high end estate and business
planning markets, sells a variety of life insurance products, including variable
life, universal life, interest sensitive whole life and term life insurance.


                                       17
<PAGE>   18

1999 COMPARED TO 1998 - Revenues increased $17, or 3%, resulting primarily from
higher fee income associated with the growing block of variable life insurance.
Fee income increased $59, or 18%, as variable life account values increased
$868, or 50%, and variable life insurance in force increased $7.5 billion, or
46%. The higher fee income was partially offset by a decrease in premium revenue
resulting from the sale of the Company's Canadian life insurance operation in
1999. Total benefits, claims and expenses increased slightly, principally due to
a $21 increase in amortization of deferred policy acquisition costs associated
with the growth in this segment's revenues, partially offset by a decrease of
$11 in benefits, claims and claim adjustment expenses due to the sale of the
Canadian life insurance operation and lower mortality costs. Net income
increased $6, or 9%, essentially due to the higher fee income and favorable
mortality described above.

1998 COMPARED TO 1997 - Revenues increased $57, or 11%, resulting from higher
fee income associated with the Company's growing block of variable life
insurance. Variable life account values increased $651, or 61%, due to strong
sales of $127, a 30% increase over prior year levels, as well as equity market
appreciation, while variable life insurance in force increased $6.6 billion, or
67%. Total benefits, claims and expenses increased $43, or 10%, as a result of
an increase in amortization of deferred policy acquisition costs of $21 and an
increase in benefits, claims and claim adjustment expenses of $18 related to the
growth in this segment. The growth in the Individual Life operation's account
values and life insurance in force, particularly variable life, resulted in an
increase in net income of $9, or 16%.

OUTLOOK

Management believes that the Company's strong market position will provide
opportunities for growth in this segment as individuals increasingly prepare
their estates for an efficient transfer of wealth between generations.


EMPLOYEE BENEFITS

OPERATING SUMMARY

<TABLE>
<CAPTION>
                                                                                     1999              1998                1997
------------------------------------------------------------------------------------------------------------------------------------
<S>                                                                           <C>                <C>                <C>
Premiums and other considerations                                             $       1,829      $       1,629      $       1,538
Net investment income                                                                   195                180                162
------------------------------------------------------------------------------------------------------------------------------------

          TOTAL REVENUES                                                              2,024              1,809              1,700
          --------------------------------------------------------------------------------------------------------------------------
Benefits, claims and claim adjustment expenses                                        1,507              1,335              1,301
Amortization of deferred policy acquisition costs and other expenses                    415                376                309
------------------------------------------------------------------------------------------------------------------------------------
          TOTAL BENEFITS, CLAIMS AND EXPENSES                                         1,922              1,711              1,610
          --------------------------------------------------------------------------------------------------------------------------

          INCOME BEFORE INCOME TAX EXPENSE                                              102                 98                 90
Income tax expense                                                                       23                 27                 32
------------------------------------------------------------------------------------------------------------------------------------
          NET INCOME                                                          $          79      $          71      $          58
          --------------------------------------------------------------------------------------------------------------------------
</TABLE>

The Employee Benefits segment sells group life and group disability insurance as
well as other products, including stop loss and supplementary medical coverage
to employers and employer sponsored plans, accidental death and dismemberment,
travel accident, long-term care insurance and other special risk coverages to
employers and associations. The Company also offers disability underwriting,
administration, claims processing services and reinsurance to other insurers and
self-funded employer plans. According to the latest results published by the
Life Insurance Marketing and Research Association (LIMRA), the Company was the
third largest provider of group disability insurance and the fourth largest
writer of group life insurance in the United States for the nine months ended
September 30, 1999.

1999 COMPARED TO 1998 - Revenues increased $215, or 12%, driven by growth in
fully insured premiums, excluding buyouts, which increased $172, or 11%. This
increase was fundamentally due to group life and group disability, where ongoing
premiums increased $49, or 9%, and $63, or 11%, respectively, due to strong
persistency of the in force block of business, coupled with an increase in sales
to new customers.

Total benefits, claims and expenses increased $211, or 12%, primarily due to
higher benefits, claims and claim adjustment expenses, which, excluding buyouts,
increased $187, or 11%, due to the growth in this segment. The ratio of
benefits, claims and claim adjustment expenses as a percentage of premiums and
other considerations (loss ratio), excluding buyouts, remained consistent at
82%, indicating a continuation of favorable mortality and morbidity experience.
In addition, the ratio of amortization of deferred policy acquisition costs and
other expenses as a percentage of premiums and other considerations (expense
ratio), excluding buyouts, remained consistent at 24%.


                                       18
<PAGE>   19

The segment's effective income tax rate was reduced to 23% from 28% as a result
of increasing the level of investment in tax-exempt securities. As a result of
increased premium revenue, consistent loss and expense ratios and increased
after-tax investment income, net income increased $8, or 11%.

1998 COMPARED TO 1997 - Revenues increased $109, or 6%, driven by growth in
fully insured premiums, excluding buyouts, which increased $181, or 13%. This
increase was primarily due to group life and group disability, where ongoing
premiums increased $69 and $55, respectively, due to strong sales and good
persistency. Sales of fully insured business, excluding buyouts, increased $68,
or 21%, of which group life and group disability business increased $26 and $23,
respectively.

Total benefits, claims and expenses increased $101, or 6%, primarily due to
higher benefits, claims and claim adjustment expenses, which, excluding buyouts,
increased $121 associated with this growing block of business. However, the
ratio of benefits, claims and claim adjustment expenses as a percentage of
premiums and other considerations, excluding buyouts, improved to 82% from 83%.
This improvement was partially offset by an increase in other expenses of $66,
whereby other expenses as a percentage of premiums and other considerations,
excluding buyouts, increased to 24% from 22%. This trend is due to the Company's
continued investment in claims management initiatives, which result in higher
operating expenses but improve benefits, claims and claim adjustment expenses.

The segment's effective income tax rate was reduced to 28% from 36% as a result
of increasing the level of investment in tax-exempt securities, which improved
the after-tax investment yield to 5.2% from 5.0%. As a result of increased
premium revenue, an improved after-tax investment yield and favorable mortality
and morbidity experience, net income increased $13, or 22%.

OUTLOOK

As employers continue to offer benefit plans in order to attract and retain
valued employees, management expects that the need for group life and group
disability insurance will continue to expand and believes the Company is well
positioned to take advantage of this growth potential.


CORPORATE OWNED LIFE INSURANCE (COLI)

OPERATING SUMMARY

<TABLE>
<CAPTION>
                                                                             1999               1998               1997
------------------------------------------------------------------------------------------------------------------------------
<S>                                                                   <C>                <C>                <C>
Premiums and other considerations                                     $         400      $         774      $         551
Net investment income                                                           431                793                429
------------------------------------------------------------------------------------------------------------------------------

          TOTAL REVENUES                                                        831              1,567                980
          --------------------------------------------------------------------------------------------------------------------
Benefits, claims and claim adjustment expenses                                  621                924                439
Dividends to policyholders                                                      104                329                240
Other expenses                                                                   59                278                259
------------------------------------------------------------------------------------------------------------------------------
          TOTAL BENEFITS, CLAIMS AND EXPENSES                                   784              1,531                938
          --------------------------------------------------------------------------------------------------------------------

          INCOME BEFORE INCOME TAX EXPENSE                                       47                 36                 42
Income tax expense                                                               17                 12                 15
------------------------------------------------------------------------------------------------------------------------------
          NET INCOME                                                  $          30      $          24      $          27
          --------------------------------------------------------------------------------------------------------------------

Variable COLI account values                                          $      12,386      $      11,220      $       6,600
Leveraged COLI account values                                                 5,729              9,148              5,719
------------------------------------------------------------------------------------------------------------------------------
           TOTAL ACCOUNT VALUES                                       $      18,115      $      20,368      $      12,319
           -------------------------------------------------------------------------------------------------------------------
</TABLE>

Hartford Life is a leader in the COLI market, which includes life insurance
policies purchased by a company on the lives of its employees, with the company
named as beneficiary under the policy. Until the Health Insurance Portability
and Accountability Act of 1996 (HIPA Act of 1996), the Company sold two
principal types of COLI business, leveraged and variable products. Leveraged
COLI is a fixed premium life insurance policy owned by a company or a trust
sponsored by a company. The HIPA Act of 1996 phased out the deductibility of
interest on policy loans under leveraged COLI through the end of 1998, virtually
eliminating all future sales of this product. Variable COLI continues to be a
product used by employers to fund non-qualified benefits or other postemployment
benefit liabilities. Products marketed in this segment also include coverage
owned by employees under business sold through corporate sponsorship.

1999 COMPARED TO 1998 - Revenues decreased $736, or 47%, primarily attributable
to the downsizing of the leveraged COLI business as a result of the HIPA Act of
1996. During 1999, leveraged COLI account values decreased $3.4 billion, or 37%.
Consistent with the decrease in revenues, benefits, claims and expenses
decreased $747, or 49%. Net income increased $6, or 25%, primarily due

                                       19
<PAGE>   20
to growth in the variable COLI business, where related account values increased
$1.2 billion, or 10%. Additionally, leveraged COLI net income increased due to
earnings associated with the MBL business recaptured in November 1998 (as
discussed earlier), which was partially offset by decreases associated with the
downsizing of the overall leveraged COLI business.

1998 COMPARED TO 1997 - Revenues increased $587, or 60%, primarily related to
the recaptured MBL business of $541, comprised of $163 of premiums and other
considerations and $378 of net investment income. In addition, revenues
increased due to fee income on growing variable COLI account values, partially
offset by declines in revenues associated with the downsizing of the overall
leveraged COLI business. Benefits, claims and expenses increased $593, or 63%,
primarily due to the recaptured MBL business. The MBL recapture resulted in an
increase in benefits, claims and expenses of $541 and was comprised of $452 of
benefits, claims and other expenses and $89 of dividends to policyholders. Net
income declined $3, or 11%, as the growth in the Company's variable COLI
business was offset by the declining block of leveraged COLI the Company had
prior to passage of the HIPA Act of 1996. The recaptured MBL business had no
impact on net income in 1998.

OUTLOOK

The focus of this segment is variable COLI, which continues to be a product
generally used by employers to fund non-qualified benefits or other
postemployment benefit liabilities. The leveraged COLI product has been an
important contributor to Hartford Life's profitability in recent years and will
continue to contribute to the profitability of Hartford Life in the future,
although the level of profit is expected to decline. COLI is subject to a
changing legislative and regulatory environment that could have a material
adverse affect on its business. Certain proposed legislative initiatives could
impact COLI and are discussed in the Regulatory Matters and Contingencies
section.


RESERVES

In accordance with applicable insurance regulations under which Hartford Life
operates, life insurance subsidiaries of the Company establish and carry as
liabilities actuarially determined reserves which are calculated to meet
Hartford Life's future obligations. Reserves for life insurance and disability
contracts are based on actuarially recognized methods using prescribed morbidity
and mortality tables in general use in the United States, which are modified to
reflect Hartford Life's actual experience when appropriate. These reserves are
computed at amounts that, with additions from premiums to be received and with
interest on such reserves compounded annually at certain assumed rates, are
expected to be sufficient to meet the Company's policy obligations at their
maturities or in the event of an insured's death. Reserves include unearned
premiums, premium deposits, claims incurred but not reported and claims reported
but not yet paid. Reserves for assumed reinsurance are computed on bases
essentially comparable to direct insurance reserves.


INVESTMENTS

GENERAL

The Company's investments are managed by its investment strategy group, which
consists of a risk management unit and a portfolio management unit and reports
directly to senior management of the Company. The risk management unit is
responsible for monitoring and managing the Company's asset/liability profile
and establishing investment objectives and guidelines. The portfolio management
unit is responsible for determining, within specified risk tolerances and
investment guidelines, the appropriate asset allocation, duration, and convexity
characteristics of the Company's general account and guaranteed separate account
investment portfolios. The Hartford Investment Management Company, a wholly
owned subsidiary of The Hartford Financial Services Group, Inc., executes the
investment plan of the investment strategy group, including the identification
and purchase of securities that fulfill the objectives of the strategy group.

The primary investment objective of the Company's general account and guaranteed
separate accounts is to maximize after-tax returns consistent with acceptable
risk parameters (including the management of the interest rate sensitivity of
invested assets relative to that of policyholder obligations). The Company does
not hold any financial instruments purchased for trading purposes. The Company
is exposed to two primary sources of investment risk: credit risk, relating to
the uncertainty associated with an obligor's continued ability to make timely
payment of principal and/or interest, and interest rate risk, relating to the
market price and/or cash flow variability associated with changes in market
yield curves. See the Capital Markets Risk Management section for further
discussion of the Company's approach to managing these investment risks.

The Company's separate accounts reflect two categories of risk assumption:
non-guaranteed separate accounts totaling $101.8 billion and $80.6 billion as of
December 31, 1999 and 1998, respectively, wherein the policyholder assumes
substantially all the investment risk and reward, and guaranteed separate
accounts totaling $8.9 billion and $10.0 billion as of December 31, 1999 and
1998, respectively, wherein Hartford Life contractually guarantees either a
minimum return or account value to the policyholder. Non-

                                       20
<PAGE>   21
guaranteed separate account products include variable annuities, variable life
insurance contracts and variable COLI. Guaranteed separate account products
primarily consist of modified guaranteed individual annuities and modified
guaranteed life insurance and generally include market value adjustment features
to mitigate the risk of disintermediation.

The Company's general account consists of a diversified portfolio of
investments. Although all the assets of the general account support the
Company's general account liabilities, the Company's investment strategy group
has developed separate investment portfolios for specific classes of product
liabilities within the general account. The strategy group works closely with
the business lines to develop specific investment guidelines, including duration
targets, asset allocation and convexity constraints, asset/liability mismatch
tolerances and return objectives for each product line in order to achieve each
product line's individual risk and return objectives.

Invested assets in the Company's general account totaled $21.8 billion as of
December 31, 1999 and were comprised of $17.0 billion of fixed maturities, $4.2
billion of policy loans, equity securities of $153 and other investments of
$376. As of December 31, 1998, general account invested assets totaled $24.9
billion and were comprised of $17.7 billion of fixed maturities, $6.7 billion of
policy loans, equity securities of $140 and other investments of $363. The
decrease in policy loans was primarily due to the decline in leveraged COLI
business (as discussed in the COLI section). Policy loans are secured by the
cash value of the underlying life policy and do not mature in a conventional
sense, but expire in conjunction with the related policy liabilities.

The following table sets forth by type the fixed maturity securities held in the
Company's general account as of December 31, 1999 and 1998.

<TABLE>
<CAPTION>
                                                                  1999                                  1998
                                                   --------------------------------------------------------------------------
  FIXED MATURITIES BY TYPE                             FAIR VALUE        PERCENT            FAIR VALUE         PERCENT
  ---------------------------------------------------------------------------------------------------------------------------
<S>                                                 <C>                     <C>          <C>                    <C>
  Corporate                                         $      7,737            45.4%        $      7,898           44.6%
  Asset backed securities                                  2,508            14.7%               2,465           13.9%
  Commercial mortgage backed securities                    2,112            12.4%               2,036           11.5%
  Short-term                                               1,346             7.9%               2,119           12.0%
  Municipal - tax-exempt                                   1,108             6.5%                 916            5.2%
  Mortgage backed securities - agency                        853             5.0%                 503            2.9%
  Collateralized mortgage obligations                        592             3.5%                 831            4.7%
  Government/Government agencies - Foreign                   339             2.0%                 530            3.0%
  Government/Government agencies - U.S.                      229             1.3%                 166            0.9%
  Municipal - taxable                                        165             1.0%                 223            1.3%
  Redeemable preferred stock                                  46             0.3%                   5             --
  ---------------------------------------------------------------------------------------------------------------------------
    TOTAL FIXED MATURITIES                          $     17,035          100.0%         $     17,692           100.0%
  ---------------------------------------------------------------------------------------------------------------------------
</TABLE>

During 1999, the Company, in executing its investment strategy, increased its
allocation to municipal tax-exempt securities with the objective of increasing
after-tax yields, and also increased its allocation to mortgage backed and
commercial mortgage backed securities. Holdings of short-term securities
declined, primarily as a result of the funding of scheduled liability
maturities.

Approximately 21.5% and 22.8% of the Company's fixed maturity portfolio was
invested in private placement securities (including Rule 144A offerings) as of
December 31, 1999 and 1998, respectively. Private placement securities are
generally less liquid than public securities; however, covenants for private
placements are designed to mitigate liquidity risk. Most of the private
placement securities in the Company's portfolio are rated by nationally
recognized rating organizations. For further discussion of the Company's
investment credit policies, see the Capital Markets Risk Management section
under "Credit Risk".

INVESTMENT RESULTS

The table below summarizes Hartford Life's investment results.


<TABLE>
<CAPTION>
 (Before-tax)                                                           1999                   1998                   1997
 -----------------------------------------------------------------------------------------------------------------------------------
<S>                                                             <C>                    <C>                    <C>
 Net investment income - excluding policy loan income           $       1,171          $       1,166          $       1,111
 Policy loan income                                                       391                    789                    425
 -----------------------------------------------------------------------------------------------------------------------------------
 Net investment income - total                                  $       1,562          $       1,955          $       1,536
 -----------------------------------------------------------------------------------------------------------------------------------
 Yield on average invested assets (1)                                     6.7%                   7.9%                   7.6%
 -----------------------------------------------------------------------------------------------------------------------------------
 Net realized capital losses                                    $          (5)         $          --          $          --
 -----------------------------------------------------------------------------------------------------------------------------------
</TABLE>

 (1)  Represents net investment income (excluding net realized capital losses)
      divided by average invested assets at cost (fixed maturities at amortized
      cost). In 1998, average invested assets were calculated assuming the
      recaptured MBL business proceeds were received on January 1, 1998.



                                       21
<PAGE>   22

1999 COMPARED TO 1998 - Total net investment income, before-tax, decreased $393,
or 20%, most notably due to a decrease in policy loan income of $398 associated
with the downsizing of the leveraged COLI business. Yield on average invested
assets declined to 6.7% as a result of a decline in the policy loan weighted
average interest rate to 7.5% in 1999 from 9.9% in 1998. Net realized capital
losses included a $5 loss from the sale of Hartford Life Insurance Company
Canada Holdings, Inc. Additionally, net realized capital gains on the sale of
equity securities and fixed maturities offset a $32, after-tax, other than
temporary impairment charge related to asset backed securities securitized and
serviced by Commercial Financial Services, Inc. (CFS) securities, which were
sold in August of 1999.

1998 COMPARED TO 1997 - Total net investment income, before-tax, increased $419,
or 27%, principally due to an increase in policy loan income of $364, which is
primarily due to the recaptured MBL business. (For additional information on the
MBL Recapture, see the Capital Resources and Liquidity section.) Yield on
average invested assets, before-tax, increased to 7.9%, primarily due to the
increase in policy loan income that resulted from the recaptured MBL business,
as well as an increase in fixed maturities rated BBB. There were no net realized
capital gains or losses for the years ended December 31, 1998 and 1997. During
1998, realized capital gains from the sale of fixed maturities and equity
securities were offset by realized capital losses, including $21, after-tax,
related to the other than temporary impairment charge associated with asset
backed securities securitized and serviced by CFS.


CAPITAL MARKETS RISK MANAGEMENT

As described below, credit risk and market risk are the primary sources of
investment risk to the Company. The following discussion identifies the
Company's policies and procedures for managing these risks and monitoring the
results of the Company's risk management activities.

CREDIT RISK

Hartford Life has established investment credit policies that focus on the
credit quality of obligors and counterparties, limit credit concentrations,
encourage diversification and require frequent creditworthiness reviews.
Investment activity, including setting of policy and defining acceptable risk
levels, is subject to regular review and approval by senior management.

The Company invests primarily in securities rated investment grade and has
established exposure limits, diversification standards and review procedures for
all credit risks including borrower, issuer and counterparty. Creditworthiness
of specific obligors is determined by an internal credit evaluation supplemented
by consideration of external determinants of creditworthiness, typically ratings
assigned by nationally recognized ratings agencies. Obligor, asset sector and
industry concentrations are subject to established limits and monitored at
regular intervals.

The following table identifies fixed maturity securities for the Company's
operations by credit quality. The ratings referenced in the tables are based on
the ratings of nationally recognized rating organizations or, if not rated,
assigned based on the Company's internal analysis of such securities.

As of December 31, 1999 and 1998, over 97% of the fixed maturity portfolio,
including guaranteed separate accounts, was invested in investment grade
securities.


<TABLE>
<CAPTION>
                                                                1999                                   1998
                                                 ---------------------------------------------------------------------------------
 FIXED MATURITIES BY CREDIT QUALITY                    FAIR VALUE         PERCENT            FAIR VALUE             PERCENT
----------------------------------------------------------------------------------------------------------------------------------
<S>                                               <C>                    <C>             <C>                        <C>
U.S. Government/Government agencies               $        2,404           9.3%           $       2,596                9.5%
 AAA                                                       3,535          13.6%                   3,542               12.9%
 AA                                                        3,199          12.3%                   2,674                9.7%
 A                                                         8,731          33.6%                   8,878               32.3%
 BBB                                                       5,816          22.4%                   7,019               25.6%
 BB & below                                                  559           2.1%                     492                1.8%
 Short-term                                                1,728           6.7%                   2,265                8.2%
----------------------------------------------------------------------------------------------------------------------------------
   TOTAL FIXED MATURITIES                         $       25,972         100.0%           $      27,466              100.0%
----------------------------------------------------------------------------------------------------------------------------------
</TABLE>

The Company also maintains credit policies regarding the financial stability and
credit standing of its major derivatives' counterparties and typically requires
credit enhancement provisions to further reduce its credit risk. Credit risk for
derivatives contracts is limited to the amounts calculated to be due to the
Company on such contracts based on current market conditions and potential
payment obligations between the Company and its counterparties. Credit exposures
are quantified weekly and netted. Collateral is pledged to or held by the
Company to the extent the current value of derivatives exceeds exposure policy
thresholds.





                                       22
<PAGE>   23
MARKET RISK

Hartford Life's general and guaranteed separate account exposure to market risk
relates to the market price and/or cash flow variability associated with changes
in market interest rates. The following discussion focuses on the Company's
exposure to interest rate risk, asset/liability management strategies utilized
to manage this risk, and characteristics of the Company's insurance liabilities
and their sensitivity to movements in interest rates.

Upward movement in market interest rates during 1999 resulted in a significant
decline in the fair value of the fixed maturities portfolio over 1998. However,
the Company's asset allocation, and therefore its exposure to market risk, has
not changed materially from its position at December 31, 1998.

INTEREST RATE RISK

Changes in interest rates can potentially impact the Company's profitability.
Under certain circumstances of interest rate volatility, the Company could be
exposed to disintermediation risk and reduction in net interest rate spread or
profit margins. For non-guaranteed separate accounts, the Company's exposure is
not significant since the policyholder assumes substantially all the investment
risk.

The Company's general account and guaranteed separate account investment
portfolios primarily consist of investment grade, fixed maturity securities,
including corporate bonds, asset backed securities, collateralized mortgage
obligations and mortgage backed securities. The fair value of these and the
Company's other invested assets fluctuates depending on the interest rate
environment and other general economic conditions. During periods of declining
interest rates, paydowns on mortgage backed securities and collateralized
mortgage obligations increase as the underlying mortgages are prepaid. In
addition, during such periods, the Company generally will not be able to
reinvest the proceeds of any such prepayments at comparable yields. Conversely,
during periods of rising interest rates, the rate of prepayments generally
declines, exposing the Company to the possibility of asset/liability cash flow
and yield mismatch. For a discussion of the Company's risk management techniques
to manage this market risk, see "Asset/Liability Management Strategies Used to
Manage Market Risk" below.

As described above, the Company holds a significant fixed maturity portfolio,
which includes both fixed and variable rate features. The following table
reflects the principal amounts of the fixed and variable rate fixed maturity
portfolio, along with the respective weighted average coupons by estimated
maturity year as of December 31, 1999. Comparative totals are included for
December 31, 1998. Expected maturities differ from contractual maturities due to
call or prepayment provisions. The weighted average coupon on variable rate
securities is based on spot rates as of December 31, 1999 and 1998, and is
primarily based on the London Interbank Offered Rate (LIBOR). Callable bonds and
notes are distributed to either call dates or maturity, depending on which date
produces the most conservative yield. Asset backed securities, collateralized
mortgage obligations and mortgage backed securities are distributed to maturity
year based on estimates of the rate of future prepayments of principal over the
remaining life of the securities. These estimates are developed using prepayment
speeds provided in broker consensus data. Such estimates are derived from
prepayment speeds previously experienced at the interest rate levels projected
for the underlying collateral. Actual prepayment experience may vary from these
estimates. Financial instruments with certain leverage features have been
included in each of the fixed maturity categories. These instruments have not
been separately displayed because they were immaterial to the Company's
investment portfolio.



                                       23
<PAGE>   24





<TABLE>
<CAPTION>
                                                                                                                1999       1998
                                                2000      2001       2002       2003      2004    Thereafter    TOTAL      Total
------------------------------------------------------------------------------------------------------------------------------------
<S>                                           <C>        <C>       <C>        <C>        <C>       <C>        <C>         <C>
BONDS AND NOTES - CALLABLE
Fixed Rate
  Par value                                   $   100    $    56   $    35    $    66    $    9    $   810    $  1,076    $  1,083
  Weighted average coupon                         7.0%       5.8%      7.1%       7.5%      8.1%       5.1%        5.6%        5.6%
  Fair value                                                                                                  $  1,016    $  1,080
Variable Rate
  Par value                                   $   126    $    39   $    26    $     --   $   30    $ 1,142    $  1,363    $  1,082
  Weighted average coupon                         6.6%       6.2%      6.6%        --       7.3%       6.6%        6.6%        6.0%
  Fair value                                                                                                  $  1,256    $    982
BONDS AND NOTES - OTHER
Fixed Rate
  Par value                                   $ 3,361    $ 1,847   $ 1,247    $ 1,187    $1,217    $ 6,864    $ 15,723    $ 15,290
  Weighted average coupon                         6.7%       7.1%      7.3%       6.9%      6.4%       5.5%        6.2%        6.3%
  Fair value                                                                                                  $ 14,044    $ 15,315
Variable Rate
  Par value                                   $   222    $    84   $   122    $    84    $   65    $   343    $    920    $  1,153
  Weighted average coupon                         6.5%       6.0%      6.1%       5.7%      5.7%       4.9%        5.7%        5.8%
  Fair value                                                                                                  $    827    $  1,114
ASSET BACKED SECURITIES
Fixed Rate
  Par value                                   $   442    $   623   $   331    $   227    $  189    $   387    $  2,199    $  2,153
  Weighted average coupon                         6.8%       6.6%      6.5%       6.4%      6.8%       7.3%        6.8%        6.8%
  Fair value                                                                                                  $  2,045    $  2,074
Variable Rate
  Par value                                   $   218    $   292   $   252    $   241    $  192    $   482    $  1,677    $  1,730
  Weighted average coupon                         6.4%       6.4%      6.6%       6.7%      6.8%       6.7%       6.6%        6.1%
  Fair value                                                                                                  $  1,540    $  1,683
COLLATERALIZED MORTGAGE OBLIGATIONS
Fixed Rate
  Par value                                   $   354    $   251   $   154    $    85    $   51    $   243    $  1,138    $  1,425
  Weighted average coupon                         6.0%       6.1%      6.2%       6.6%      7.2%       7.4%       6.5%        6.5%
  Fair value                                                                                                  $  1,022    $  1,371
Variable Rate
  Par value                                   $    20    $     3   $     1    $     1    $    1    $   102    $    128    $    266
  Weighted average coupon                         7.3%       5.0%      6.9%      15.5%      8.1%       5.5%       5.8%        6.2%
  Fair value                                                                                                  $    117    $    264
COMMERCIAL MORTGAGE BACKED SECURITIES
Fixed Rate
  Par value                                   $   131    $   158   $   151    $    55    $  104    $ 1,497    $  2,096    $  1,767
  Weighted average coupon                         6.7%       7.6%      7.2%       7.2%      7.2%       7.1%        7.2%        7.1%
  Fair value                                                                                                  $  1,922    $  1,784
Variable Rate
  Par value                                   $   248    $   144   $   154    $   187    $  137    $   563    $  1,433    $  1,160
  Weighted average coupon                         7.3%       7.5%      7.3%       7.3%      7.6%       7.6%       7.5%        6.7%
  Fair value                                                                                                  $  1,228    $  1,075
MORTGAGE BACKED SECURITIES
Fixed Rate
  Par value                                   $    85    $    99   $    99    $    89    $   80    $   836    $  1,288    $    723
  Weighted average coupon                         7.1%       7.0%      7.0%       7.0%      7.0%       7.8%       7.5%        7.6%
  Fair value                                                                                                  $    994    $    682
Variable Rate
  Par value                                   $     1    $     1   $     --   $     --   $    --   $     2    $      4    $     11
  Weighted average coupon                         6.6%       6.6%        --         --        --       6.3%        6.4%        8.6%
  Fair value                                                                                                  $      4    $     10
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>



                                       24
<PAGE>   25

The table below provides information as of December 31, 1999 and 1998 on debt
obligations and reflects principal cash flows and related weighted average
effective interest rate by maturity year.

<TABLE>
<CAPTION>
                                                                                                                 1999        1998
                                                  2000       2001      2002       2003      2004    Thereafter   TOTAL       Total
------------------------------------------------------------------------------------------------------------------------------------
<S>                                             <C>        <C>       <C>        <C>       <C>        <C>       <C>        <C>
LONG-TERM DEBT
Fixed Rate
   Amount                                       $    --    $    --   $    --    $    --   $   200    $   450   $  650     $   650
   Weighted average effective interest rate          --         --        --         --       7.0%      7.5%      7.4%        7.4%
   Fair value                                                                                                  $  633     $   710
TruPS (1)
Fixed Rate
   Amount                                       $    --    $    --   $    --    $    --   $    --   $   250    $  250     $   250
   Weighted average effective interest rate          --         --        --         --        --       7.4%      7.4%        7.4%
   Fair value                                                                                                  $  203     $   254
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>

(1)      Represents company obligated mandatorily redeemable preferred
         securities of subsidiary trust holding solely parent junior
         subordinated debentures.

ASSET/LIABILITY MANAGEMENT STRATEGIES USED TO MANAGE MARKET RISK

The Company employs several risk management tools to quantify and manage market
risk arising from its investments and interest sensitive liabilities. For
certain portfolios, management monitors the changes in present value between
assets and liabilities resulting from various interest rate scenarios using
integrated asset/liability measurement systems and a proprietary system that
simulates the impacts of parallel and non-parallel yield curve shifts. Based on
this current and prospective information, management implements risk reducing
techniques to improve the match between assets and liabilities.

Derivatives play an important role in facilitating the management of interest
rate risk, creating opportunities to efficiently fund obligations, hedge against
risks that affect the value of certain liabilities and adjust broad investment
risk characteristics as a result of any significant changes in market risks. The
Company uses a variety of derivatives, including swaps, caps, floors, forwards
and exchange traded financial futures and options, in order to hedge exposure
primarily to interest rate risk on anticipated investment purchases or existing
assets and liabilities. The Company does not make a market or trade derivatives
for the express purpose of earning trading profits. The Company's derivative
program is monitored by an internal compliance unit and is reviewed frequently
by senior management. The notional amounts of derivative contracts, which
represent the basis upon which pay or receive amounts are calculated and are not
reflective of credit risk, totaled $9.6 billion as of December 31, 1999 ($6.3
billion related to insurance investments and $3.3 billion related to life
insurance liabilities). As of December 31, 1998, the notional amounts pertaining
to derivatives totaled $11.2 billion ($6.0 billion related to insurance
investments and $5.2 billion related to life insurance liabilities).

The strategies described below are used to manage the aforementioned risks.

Anticipatory Hedging -- For certain liabilities, the Company commits to the
price of the product prior to receipt of the associated premium or deposit.
Anticipatory hedges are routinely executed to offset the impact of changes in
asset prices arising from interest rate changes pending the receipt of premium
or deposit and the subsequent purchase of an asset. These hedges involve taking
a long position in interest rate futures or entering into an interest rate swap
with duration characteristics equivalent to the associated liabilities or
anticipated investments. The notional amount of anticipatory hedges as of
December 31, 1999 and 1998 was $314 and $712, respectively.

Liability Hedging -- Several products obligate the Company to credit a return to
the contractholder which is indexed to a market rate. To hedge risks associated
with these products, the Company enters into various derivative contracts.
Interest rate swaps are used to convert the contract rate into a rate that
trades in a more liquid and efficient market. This hedging strategy enables the
Company to customize contract terms and conditions to customer objectives and
satisfies Hartford Life's asset/liability matching policy. Interest rate swaps
are also used to convert certain fixed contract rates into floating rates,
thereby allowing them to be appropriately matched against floating rate assets.
Additionally, interest rate caps are used to hedge against the risk of
contractholder disintermediation in a rising interest rate environment. The
notional amount of derivatives used for liability hedges as of December 31, 1999
and 1998 was $3.3 billion and $5.2 billion, respectively.

Asset Hedging -- To meet the various policyholder obligations and to provide
cost effective prudent investment risk diversification, the Company may combine
two or more financial instruments to achieve the investment characteristics of a
fixed maturity security or that match an associated liability. The use of
derivative instruments in this regard effectively transfers unwanted investment
risks or attributes to others. The selection of the appropriate derivative
instruments depends on the investment risk, the liquidity and efficiency

                                       25
<PAGE>   26
of the market, and the asset and liability characteristics. The notional amount
of asset hedges as of December 31, 1999 and 1998 was $4.8 billion and $3.8
billion, respectively.

Portfolio Hedging -- The Company periodically compares the duration and
convexity of its portfolios of assets to their corresponding liabilities and
enters into portfolio hedges to reduce any difference to desired levels.
Portfolio hedges reduce the mismatch between assets and liabilities and offset
the potential impact to cash flows caused by changes in interest rates. The
notional amount of portfolio hedges as of December 31, 1999 and 1998 was $1.2
billion and $1.5 billion, respectively.

The following tables provide information as of December 31, 1999, with
comparative totals for December 31, 1998, on derivative instruments used in
accordance with the aforementioned hedging strategies. For interest rate swaps,
caps and floors, the tables present notional amounts with weighted average pay
and received rates for swaps and weighted average strike rates for caps and
floors by maturity year. For interest rate futures, the table presents contract
amount and weighted average settlement price by expected maturity year. The
Company uses option contracts to hedge debt instruments that totaled $254 and
$110 in notional amounts and $(50) and $(20) in carrying value as of December
31, 1999 and 1998, respectively.

<TABLE>
<CAPTION>
                                                                                                                 1999      1998
INTEREST RATE SWAPS                               2000      2001       2002      2003       2004    Thereafter   TOTAL     Total
------------------------------------------------------------------------------------------------------------------------------------
<S>                                             <C>        <C>       <C>        <C>       <C>        <C>        <C>       <C>
Pay Fixed/Receive Variable
  Notional value                                $   164    $  148    $   222    $   140   $   116    $   904    $ 1,694   $ 1,383
  Weighted average pay rate                         5.1%      6.1%       5.1%       6.0%      5.6%       6.1%       5.8%      5.9%
  Weighted average receive rate                     6.7%      6.2%       6.2%       6.2%      6.2%       6.2%       6.2%      5.4%
  Fair value                                                                                                    $    76   $   (46)
Pay Variable/Receive Fixed
  Notional value                                $   577    $  318    $   439    $   675   $ 1,244    $ 1,510    $ 4,763   $ 4,925
  Weighted average pay rate                         6.1%      6.2%       6.1%       6.1%      6.2%       6.2%       6.2%      5.3%
  Weighted average receive rate                     6.3%      7.0%       6.3%       5.8%      6.1%       6.4%       6.2%      6.3%
  Fair value                                                                                                    $  (160)  $   160
Pay Variable/Receive Different Variable
  Notional value                                $   145    $   85    $    40    $    29   $   101    $    42    $   442   $ 1,403
  Weighted average pay rate                         6.3%      6.3%       6.0%       6.1%      5.9%       6.3%       6.2%      5.2%
  Weighted average receive rate                     5.9%      5.6%       6.1%       6.2%      6.3%       6.8%       6.0%      5.8%
  Fair value                                                                                                    $     1   $    (2)
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>

<TABLE>
<CAPTION>
                                                                                                                  1999      1998
INTEREST RATE CAPS - LIBOR BASED (1)              2000      2001       2002      2003       2004    Thereafter   TOTAL      Total
------------------------------------------------------------------------------------------------------------------------------------
Purchased
<S>                                             <C>        <C>       <C>        <C>       <C>        <C>        <C>       <C>
  Notional value                                $    --    $   --    $    --    $    --   $    --    $    --    $    --   $     42
  Weighted average strike rate (4.0 - 5.9%)          --        --         --         --        --         --         --        5.2%
  Fair value                                                                                                    $    --   $     1

  Notional value                                $    --    $   --    $    --    $    --   $    --    $    --    $    --   $     35
  Weighted average strike rate (6.0 - 7.9%)          --        --         --         --        --         --         --        6.6%
  Fair value                                                                                                    $    --   $     1

  Notional value                                $    --    $   --    $    10    $    54   $    --    $   107    $   171   $    200
  Weighted average strike rate (8.0 - 9.9%)          --        --        8.9%       8.5%       --        8.4%       8.5%       8.5%
  Fair value                                                                                                    $     2   $     1

  Notional value                                $    10    $   --    $    21    $    --   $    --    $    --    $    31   $     41
  Weighted average strike rate (10.0 - 11.9%)      11.5%       --       10.1%        --        --         --       10.6%      10.7%
  Fair value                                                                                                    $    --   $    --
Issued
  Notional value                                $    --    $   --    $    --    $    --   $    --    $    --    $    --   $    13
  Weighted average strike rate (6.0 - 7.9%)          --        --         --         --        --         --         --        7.2%
  Fair value                                                                                                    $    --   $    --

  Notional value                                $    --    $   --    $    --    $    --   $    --    $    --    $    --   $     13
  Weighted average strike rate (8.0 - 9.9%)          --        --         --         --        --         --         --        8.3%
  Fair value                                                                                                    $    --   $    --
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>



                                       26
<PAGE>   27

(1) LIBOR represents the London Interbank Offered Rate.


<TABLE>
<CAPTION>
                                                                                                                 1999       1998
INTEREST RATE CAPS - CMT BASED (1)                2000      2001       2002      2003       2004    Thereafter   TOTAL     Total
------------------------------------------------------------------------------------------------------------------------------------
Purchased
<S>                                               <C>        <C>       <C>        <C>        <C>        <C>        <C>       <C>
  Notional value                                  $  244     $ --      $  --      $  250     $  --      $  --      $ 494     $ 611
  Weighted average strike rate (6.0 - 7.9%)          7.7%      --         --         7.7%       --         --        7.7%      7.7%
  Fair value                                                                                                       $   1     $  --

  Notional value                                  $  --      $ --      $ 100      $  250     $  --      $ 500      $ 850     $ 950
  Weighted average strike rate (8.0 - 9.9%)          --        --        9.5%        8.7%       --        8.7%       8.8%      8.7%
  Fair value                                                                                                       $   4     $    1
Issued
  Notional value                                  $  244     $ --      $  --      $  --      $  --      $  --      $ 244     $ 361
  Weighted average strike rate (6.0 - 7.9%)          7.7%      --         --         --         --         --        7.7%      7.8%
  Fair value                                                                                                       $  --     $  --

  Notional value                                  $  --      $ --      $ 100      $  --      $  --      $  --      $ 100     $ 200
  Weighted average strike rate (8.0 - 9.9%)          --        --        9.5%        --         --         --        9.5%      8.8%
  Fair value                                                                                                       $  --     $  --
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>

(1) CMT represents the Constant Maturity Treasury Rate.


<TABLE>
<CAPTION>
                                                                                                                 1999      1998
INTEREST RATE FLOORS - LIBOR BASED                2000      2001       2002      2003       2004    Thereafter   TOTAL     Total
------------------------------------------------------------------------------------------------------------------------------------
Purchased
<S>                                               <C>        <C>       <C>        <C>       <C>        <C>        <C>       <C>
  Notional value                                  $  --      $ --      $  --      $  --     $  --      $  --      $  --     $ 100
  Weighted average strike rate (4.0 - 5.9%)          --        --         --         --        --         --         --        4.2%
  Fair value                                                                                                      $  --     $  --

  Notional value                                  $  --      $ --      $  --      $  --     $   27     $  --      $  27     $  65
  Weighted average strike rate (6.0 - 7.9%)          --        --         --         --        7.9%       --         7.9%      7.0%
  Fair value                                                                                                      $   2     $   7
Issued
  Notional value                                  $  --      $ 10      $  31      $  54     $  34      $  77      $ 206     $ 240
  Weighted average strike rate (4.0 - 5.9%)          --        4.9%       5.3%       5.4%      5.3%       5.3%       5.3%      5.3%
  Fair value                                                                                                      $  (1)    $  (7)

  Notional value                                  $  --      $ --      $  --      $  --     $   27     $  --      $   27    $  27
  Weighted average strike rate (6.0 - 7.9%)          --        --         --         --        7.8%       --         7.8%      7.8%
  Fair value                                                                                                      $  (2)    $  (4)
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>



<TABLE>
<CAPTION>
                                                                                                                 1999      1998
INTEREST RATE FLOORS - CMT BASED                  2000      2001       2002      2003       2004    Thereafter   TOTAL     Total
------------------------------------------------------------------------------------------------------------------------------------
Purchased
<S>                                             <C>        <C>       <C>        <C>       <C>        <C>        <C>       <C>
  Notional value                                $    100   $   --    $    --    $    150  $    --    $    --    $    250  $    250
  Weighted average strike rate (4.0 - 5.9%)          5.8%      --         --         5.5%      --         --         5.6%      5.6%
  Fair value                                                                                                    $      1  $      8

  Notional value                                $    10    $   --    $    --    $    --   $    --    $    --    $    10   $     50
  Weighted average strike rate (6.0 - 7.9%)          6.0%      --         --         --        --         --         6.0%      6.4%
  Fair value                                                                                                    $    --   $      1
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>




                                       27
<PAGE>   28




<TABLE>
<CAPTION>
                                                                                                                 1999      1998
INTEREST RATE FUTURES                             2000      2001       2002      2003       2004    Thereafter   TOTAL     Total
------------------------------------------------------------------------------------------------------------------------------------
Long
<S>                                               <C>        <C>       <C>        <C>       <C>        <C>        <C>       <C>
  Contract amount/notional                        $  27      $ --      $  --      $  --     $  --      $  --      $  27     $  12
  Weighted average settlement price               $  97      $ --      $  --      $  --     $  --      $  --      $  97     $ 106
Short
  Contract amount/notional                        $  51      $ --      $  --      $  --     $  --      $  --      $  51     $ 240
  Weighted average settlement price               $  93      $ --      $  --      $  --     $  --      $  --      $  93     $ 124
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>


Note:  Fair value is not applicable.


Asset Accumulation Vehicles

While interest rate risk associated with these insurance products has been
reduced through the use of market value adjustment features and surrender
charges, the primary risk associated with asset accumulation products is that
the spread between investment return and credited rate may not be sufficient to
earn targeted returns.

Fixed Rate -- Products in this category require the Company to pay a fixed rate
for a certain period of time. The cash flows are not interest sensitive because
the products are written with a market value adjustment feature and the
liabilities have protection against the early withdrawal of funds through
surrender charges. Product examples include fixed rate annuities with a market
value adjustment and fixed rate guaranteed investment contracts. Contract
duration is dependent on the policyholder's choice of guarantee period.

Indexed -- Products in this category are similar to the fixed rate asset
accumulation vehicles but require the Company to pay a rate that is determined
by an external index. The amount and/or timing of cash flows will therefore vary
based on the level of the particular index. The primary risks inherent in these
products are similar to the fixed rate asset accumulation vehicles, with an
additional risk that changes in the index may adversely affect profitability.
Product examples include indexed guaranteed investment contracts with an
estimated duration of up to two years.

Interest Credited -- Products in this category credit interest to policyholders,
subject to market conditions and minimum guarantees. Policyholders may surrender
at book value but are subject to surrender charges for an initial period.
Product examples include universal life contracts and the general account
portion of the Company's variable annuity products. Liability duration is short
to intermediate term.

Other Insurance Products

Long-Term Pay Out Liabilities -- Products in this category are long term in
nature and may contain significant actuarial (including mortality and morbidity)
pricing and cash flow risks. The cash flows associated with these policy
liabilities are not interest rate sensitive but do vary based on the timing and
amount of benefit payments. The primary risks associated with these products are
that the benefits will exceed expected actuarial pricing and/or that the actual
timing of the cash flows will differ from those anticipated resulting in an
investment return lower than that assumed in pricing. Product examples include
structured settlement contracts, on-benefit annuities (i.e., the annuitant is
currently receiving benefits thereon) and long-term disability contracts.
Contract duration is generally five to ten years.

Short-Term Pay Out Liabilities -- These liabilities are short term in nature
with a duration of less than one year. The primary risks associated with these
products are determined by the non-investment contingencies such as mortality or
morbidity and the variability in the timing of the expected cash flows.
Liquidity is of greater concern than for the long-term pay out liabilities.
Products include individual and group term life insurance contracts and
short-term disability contracts.





                                       28
<PAGE>   29
Management of the duration of investments with respective policyholder
obligations is an explicit objective of the Company's management strategy. The
estimated cash flows of insurance policy liabilities based upon internal
actuarial assumptions as of December 31, 1999 are reflected in the table below
by expected maturity year. Comparative totals are included for December 31,
1998.

(Dollars in billions)
<TABLE>
<CAPTION>
                                                                                                                   1999      1998
DESCRIPTION (1)                                     2000       2001      2002       2003      2004    Thereafter   TOTAL     Total
------------------------------------------------------------------------------------------------------------------------------------
<S>                                                 <C>       <C>        <C>       <C>        <C>       <C>        <C>       <C>
Fixed rate asset accumulation vehicles              $ 1.9     $  1.4     $  0.7    $  1.3     $  2.2    $  2.2     $  9.7    $ 10.9
  Weighted average credited rate                      6.6%       6.8%       6.3%      5.5%       6.9%      6.8%       6.6%      6.6%
Indexed asset accumulation vehicles                 $ 0.4     $  0.2     $  --     $  --      $  --     $  --      $  0.6    $  0.3
  Weighted average credited rate                      6.2%       6.3%       --        --         --        --         6.2%      5.1%
Interest credited asset accumulation vehicles       $ 4.7     $  0.6     $  0.5    $  0.3     $  0.3    $  4.2     $ 10.6    $ 11.1
  Weighted average credited rate                      5.9%       5.5%       5.5%      5.6%       5.6%      5.6%       5.7%      5.7%
Long-term pay out liabilities                       $ 0.7     $  0.6     $  0.5    $  0.4     $  0.4    $  3.0     $  5.6    $  4.9
Short-term pay out liabilities                      $ 0.8     $  --      $  --     $  --      $  --     $  --      $  0.8    $  0.7
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>

(1)      As of December 31, 1999 and 1998, the fair value of the Company's
         investment contracts, including guaranteed separate accounts, was $20.9
         billion and $21.7 billion, respectively.

CURRENCY EXCHANGE RISK

Hartford Life's international holdings, which are primarily located in Latin
America, totaled approximately $90 as of December 31, 1999. These holdings are
inherently affected by currency fluctuations. The Company's primary currency
exposure relates to the Brazilian real and the Argentine peso and is not
expected to have a material impact on the Company's liquidity or financial
condition.

SENSITIVITY TO CHANGES IN INTEREST RATES

For liabilities whose cash flows are not substantially affected by changes in
interest rates (fixed liabilities) and where investment experience is
substantially absorbed by the Company, the sensitivity of the net economic value
(discounted present value of asset cash flows less the discounted present value
of liability cash flows) of those portfolios to 100 basis point shifts in
interest rates is shown in the table below. These fixed liabilities represent
approximately 55% of the Company's general and guaranteed separate account
liabilities at both December 31, 1999 and 1998. The remaining liabilities
generally allow the Company significant flexibility to adjust credited rates to
reflect actual investment experience and thereby pass through a substantial
portion of actual investment experience to the policyholder. The fixed liability
portfolios are managed and monitored relative to defined objectives and are
analyzed regularly by management for internal risk management purposes using
scenario simulation techniques, and evaluated annually consistent with
regulatory requirements.

<TABLE>
<CAPTION>
                                                                        CHANGE IN NET ECONOMIC VALUE
                                       ---------------------------------------------------------------------------------------------
                                                             1999                                            1998
                                       ---------------------------------------------------------------------------------------------
Basis point shift                               - 100                    + 100                   - 100                 + 100
------------------------------------------------------------------------------------------------------------------------------------
<S>                                     <C>                     <C>                       <C>                   <C>
  Amount                                $          (4)          $            (5)          $          7          $         (16)
 Percent of liability value                      (0.03)%                   (0.03)%                0.05%                  (0.10)%
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>





                                       29
<PAGE>   30



CAPITAL RESOURCES AND LIQUIDITY

Capital resources and liquidity represent the overall financial strength of
Hartford Life and its ability to generate strong cash flows from each of the
business segments and borrow funds at competitive rates to meet operating and
growth needs. The Company maintained cash and short-term investments totaling
$1.4 billion, $2.2 billion and $1.5 billion as of December 31, 1999, 1998 and
1997, respectively. The capital structure of Hartford Life consists of debt and
equity, and is summarized as follows:

<TABLE>
<CAPTION>
                                                                                           1999            1998            1997
------------------------------------------------------------------------------------------------------------------------------------
<S>                                                                                       <C>             <C>             <C>
Short-term debt                                                                           $      --       $      --       $     50
Long-term debt                                                                                  650             650            650
Company obligated mandatorily redeemable preferred securities of subsidiary
  trust holding solely parent junior subordinated debentures (TruPS)                            250             250             --
------------------------------------------------------------------------------------------------------------------------------------
     TOTAL DEBT                                                                           $     900       $     900       $    700
     -------------------------------------------------------------------------------------------------------------------------------
Equity excluding net unrealized capital gains (losses) on securities, net of tax          $   2,642       $   2,230       $  1,907
Net unrealized capital gains (losses) on securities, net of tax                                (336)            263            237
------------------------------------------------------------------------------------------------------------------------------------
     TOTAL STOCKHOLDERS' EQUITY                                                           $   2,306       $   2,493       $  2,144
     -------------------------------------------------------------------------------------------------------------------------------
     TOTAL CAPITALIZATION (1)                                                             $   3,542       $   3,130       $  2,607
     -------------------------------------------------------------------------------------------------------------------------------
Debt to equity (1) (2)                                                                           34%            40%             37%
Debt to capitalization (1) (2)                                                                   25%            29%             27%
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>

(1)      Excludes net unrealized capital gains (losses) on securities, net of
         tax.

(2)      Excluding TruPS, the debt to equity ratios were 25% and 29%, and the
         debt to capitalization ratios were 18% and 21% as of December 31, 1999
         and 1998, respectively.

CAPITALIZATION

The Company's total capitalization, excluding net unrealized capital gains
(losses) on securities, net of tax, increased $412, or 13%, in 1999 and $523, or
20%, in 1998. In 1999, the increase was primarily the result of net income of
$467 partially offset by dividends declared of $50. In 1998, the increase was
primarily the result of net income of $386 and the issuance of TruPS of $250,
which were partially offset by the retirement of $50 in commercial paper and
dividends declared of $50. As a result, both the debt to equity and debt to
capitalization ratios (both exclude net unrealized capital gains {losses} on
securities, net of tax) decreased to 34% and 25% as of December 31, 1999,
respectively, from 40% and 29% as of December 31, 1998, respectively. Net
unrealized capital gains (losses) on securities, net of tax, decreased $599 as
of December 31, 1999, as compared to December 31, 1998, primarily due to the
impact of increased interest rates on the Company's fixed maturity portfolio.

INITIAL PUBLIC OFFERING

For a discussion of Hartford Life's IPO, see Note 3 of Notes to Consolidated
Financial Statements.

DEBT

For a discussion of Debt, see Note 7 of Notes to Consolidated Financial
Statements.

COMPANY OBLIGATED MANDATORILY REDEEMABLE PREFERRED SECURITIES OF SUBSIDIARY
TRUST HOLDING SOLELY PARENT JUNIOR SUBORDINATED DEBENTURES

For a discussion of Company Obligated Mandatorily Redeemable Preferred
Securities of Subsidiary Trust Holding Solely Parent Junior Subordinated
Debentures, see Note 8 of Notes to Consolidated Financial Statements.






                                       30
<PAGE>   31
DIVIDENDS

In 1999, a total of $50 in dividends was declared to holders of Class A and
Class B Common Stock.

On February 17, 2000, Hartford Life's Board of Directors approved an 11%
increase in the quarterly dividend to $0.10 per share, payable on April 3, 2000
to stockholders of record on March 1, 2000. Future dividend decisions are based
on, and affected by, a number of factors, including the operating results and
financial requirements of Hartford Life on a stand-alone basis and the impact of
the regulatory restrictions discussed in Liquidity Requirements below.

As a holding company, Hartford Life, Inc. has no significant business operations
of its own and, therefore, relies mainly on the dividends from its insurance
company subsidiaries, which are primarily domiciled in Connecticut, as the
principal source of cash to meet its obligations (predominantly debt
obligations) and pay stockholder dividends. Hartford Life, Inc. received
dividends from its regulated life insurance subsidiaries of $90 in 1999.
Statutory net income and statutory capital and surplus, key determinants in the
amount of dividend capacity available in the insurance company subsidiaries, has
grown significantly over the past several years. Statutory net income of $220 in
1999 was lower than 1998 due to losses realized on certain securities. Excluding
those losses, statutory net income in 1999 was $290, 9% higher than 1998.
Statutory capital and surplus as of December 31, 1999 was $2.2 billion, a 10%
increase over December 31, 1998.

TREASURY STOCK

During 1999, to make shares available to employees pursuant to stock based
benefit plans, the Company repurchased 225,000 shares of its Class A Common
Stock in the open market at a total cost of $10. Shares repurchased in the open
market are carried at cost and reflected as a reduction to stockholders' equity.
Treasury shares subsequently reissued are reduced from treasury stock on a
weighted average cost basis. The Company currently intends to purchase
additional shares of its Class A Common Stock to make shares available for its
various employee stock based benefit plans.

RATINGS

The following table summarizes Hartford Life's significant U.S. member
companies' financial ratings from the major independent rating organizations as
of February 29, 2000:

<TABLE>
<CAPTION>
                                                         DUFF &                 STANDARD &
                                           A.M. BEST     PHELPS      MOODY'S      POOR'S
------------------------------------------------------------------------------------------
<S>                                        <C>           <C>         <C>        <C>
INSURANCE RATINGS
Hartford Life Insurance Company                A+         AA+          Aa3          AA
Hartford Life and Accident                     A+         AA+          Aa3          AA
Hartford Life and Annuity                      A+         AA+          Aa3          AA
------------------------------------------------------------------------------------------
OTHER RATINGS
Hartford Life, Inc.
  Senior debt                                  a+         A+           A2           A
  Commercial paper                             --         D-1          P-1          A-1
Hartford Life Capital I
  Trust preferred securities                   a+         A            a2          BBB+
------------------------------------------------------------------------------------------
</TABLE>

Ratings are an important factor in establishing the competitive position of an
insurance company such as Hartford Life. There can be no assurance that the
Company's ratings will continue for any given period of time or that they will
not be changed. In the event that the Company's ratings are downgraded, the
level of sales or the persistency of the Company's block of in force business
may be adversely impacted.


                                       31
<PAGE>   32
LIQUIDITY REQUIREMENTS

The liquidity requirements of Hartford Life have been and will continue to be
met by funds from operations as well as the issuance of commercial paper, debt
securities and bank borrowings. The principal sources of funds are premiums and
investment income as well as maturities and sales of invested assets. Hartford
Life is a holding company which receives operating cash flow in the form of
dividends from its subsidiaries, enabling it to service its debt, pay dividends
on its common stock and support its other obligations.

Dividends to Hartford Life, Inc. from its direct subsidiary, Hartford Life and
Accident Insurance Company (HLA), as an insurance company domiciled in
Connecticut, are subject to restriction as prescribed in the insurance holding
company laws of Connecticut. HLA adheres to these laws, which require notice to
and approval by the state insurance commissioner for the declaration or payment
of any dividend that, together with other dividends or distributions made within
the preceding twelve months, exceeds the greater of (i) 10% of the insurer's
policyholder surplus as of December 31 of the preceding year or (ii) net income
(or net gain from operations, if such company is a life insurance company) for
the twelve month period ending on the thirty-first day of December last
preceding, in each case determined under statutory insurance accounting
policies. In addition, if any dividend of a Connecticut-domiciled insurer
exceeds the insurer's earned surplus, it requires the prior approval of the
Connecticut Insurance Commissioner. The total amount of statutory dividends
which may be paid by the insurance subsidiaries of the Company without prior
approval in 2000 is estimated to be $221.

The insurance holding company laws of the other jurisdictions in which Hartford
Life's insurance subsidiaries are incorporated or deemed commercially domiciled
generally contain similar limitations on the payment of dividends.

The primary uses of funds are to pay claims, policy benefits, operating expenses
and commissions, and to purchase new investments. Hartford Life carries a
significant short-term investment position and accordingly does not anticipate
selling intermediate- and long-term fixed maturity investments to meet any
liquidity needs. For a discussion of the Company's investment objectives and
strategies, see the Investments section.

RISK-BASED CAPITAL

The National Association of Insurance Commissioners (NAIC) has regulations
establishing minimum capitalization requirements based on Risk-Based Capital
(RBC) formulas for life insurance companies. The requirements consist of
formulas which identify companies that are undercapitalized and require specific
regulatory actions. The RBC formula for life insurance companies establishes
capital requirements relating to insurance, business, asset and interest rate
risks. The RBC ratios for each of the life insurance subsidiaries are in excess
of 200% as of December 31, 1999, which are greater than the minimum threshold.

<TABLE>
<CAPTION>
CASH FLOW

                                                        1999          1998          1997
-----------------------------------------------------------------------------------------
<S>                                                   <C>           <C>           <C>
Cash provided by operating activities                 $   724       $   667       $ 1,147
Cash provided by (used for) investing activities        1,907            87          (650)
Cash used for financing activities                     (2,578)         (803)         (480)
Cash - end of year                                         89            36            88
-----------------------------------------------------------------------------------------
</TABLE>

During 1999, the increase in cash provided by operating activities was primarily
the result of an increase in net income as well as timing in the settlement of
receivables and payables. The increase in cash provided by (used for) investing
activities and the decrease in cash used for financing activities primarily
related to the significant downsizing of the leveraged COLI block of business,
as well as the decrease in the Company's guaranteed investment contract (GIC)
business.

In 1998, the change in cash provided by operating activities was primarily the
result of timing in the settlement of receivables and payables. The change in
cash provided by (used for) investing activities primarily reflects a decrease
in policy loans resulting from the reduction of COLI account values in
conjunction with the decline of the block of leveraged COLI offset by the
investment of cash from operating and financing activities. The change in cash
used for financing activities was primarily due to declines in GIC and COLI
account values as well as proceeds from the IPO in May 1997, partially offset by
changes in debt, dividends paid and proceeds from the TruPS offering.

Operating cash flows in the periods presented have been more than adequate to
meet liquidity requirements.


                                       32
<PAGE>   33
PURCHASES OF AFFILIATES AND OTHER

PLANCO -- On August 26, 1998, the Company completed the purchase of all
outstanding shares of PLANCO Financial Services, Inc. and its affiliate, PLANCO,
Incorporated (collectively, "PLANCO"). PLANCO, a primary distributor of the
Company's annuities and mutual funds, is the nation's largest wholesaler of
individual annuities and has played a significant role in Hartford Life's growth
over the past decade. As a wholesaler, PLANCO distributes Hartford Life's fixed
and variable annuities, mutual funds and single premium variable life insurance,
as well as providing sales support to registered representatives, financial
planners and broker-dealers at brokerage firms and banks across the United
States. The acquisition has been accounted for as a purchase and accordingly,
the results of PLANCO's operations have been included in the Company's
consolidated financial statements from the closing date of the transaction.

MBL Recapture -- On November 10, 1998, the Company recaptured an in force block
of COLI business (referred to as "MBL Recapture") previously ceded to MBL Life
Assurance Co. of New Jersey (MBL Life). The transaction was consummated through
the assignment of a reinsurance arrangement between Hartford Life and MBL Life
to a Hartford Life subsidiary. Hartford Life originally assumed the life
insurance block in 1992 from Mutual Benefit Life, which was placed in
court-supervised rehabilitation in 1991, and reinsured a portion of those
policies back to MBL Life. MBL Life, previously a Mutual Benefit Life
subsidiary, operated under the Rehabilitation Plan for Mutual Benefit Life. The
MBL Recapture has been recorded retroactive to January 1, 1998 with respect to
results of operations. The transaction resulted in a decrease in reinsurance
recoverables of $4.8 billion with an offset primarily in policy loans and other
investments.

In conjunction with the MBL Recapture transaction, the Company also purchased
the outstanding interest in International Corporate Marketing Group, Inc.
(ICMG), which was previously 40% owned by MBL Life.


REGULATORY MATTERS AND CONTINGENCIES

LEGISLATIVE AND REGULATORY INITIATIVES

The business of insurance is primarily regulated by the states and is also
affected by a range of legislative developments at the state and federal levels.
Passage in November 1999 of the Gramm-Leach-Bliley Act (the Financial Services
Modernization Act), which permits affiliations among banks, insurance companies
and securities firms, may have competitive, operational and other implications
for the Company. In particular, the measure includes privacy protections
requiring all financial services providers to disclose their privacy policies
and restrict the sharing of personal information for marketing purposes. Various
states are considering even more restrictive privacy measures that could
potentially affect the Company's operations. Medical records are also subject to
new privacy safeguards under guidelines proposed by the U.S. Department of
Health and Human Services. These and similar measures proposed at the state
level could affect the Company's ability to manage medical claims.

Enactment of Gramm-Leach-Bliley at the federal level has focused renewed
attention on state regulation of insurance. Elements of the insurance industry
are involved in a countrywide initiative to streamline regulatory procedures.
Such measures could result in reduced transaction costs and improved speed to
market.

Current and proposed federal measures which may significantly affect the life
insurance business include tax law changes affecting the tax treatment of life
insurance products and its impact on the relative desirability of various
personal investment vehicles, medical testing for insurability, and proposed
legislation to prohibit the use of gender in determining insurance and pension
rates and benefits. In particular, President Clinton's 2001 federal budget
proposal currently contains certain recommendations for modifying tax rules
related to the treatment of COLI by contractholders which, if enacted as
described, could have a material adverse impact on the Company's sales of these
products. The budget proposal also includes provisions which would result in a
significant increase in the "DAC tax" on certain of the Company's products and
would apply a tax to the Company's policyholder surplus account. (For further
discussion on policyholder surplus accounts and related tax treatment as of
December 31, 1999, see Note 14 of Notes to Consolidated Financial Statements.)
It is too early to determine whether these tax proposals will ultimately be
enacted by Congress. Therefore, the potential impact to the Company's financial
condition or results of operations cannot be reasonably estimated at this time.

INSOLVENCY FUND

See Note 16 (b) of Notes to Consolidated Financial Statements.


                                       33
<PAGE>   34
NAIC PROPOSALS

The NAIC has been developing several model laws and regulations, including a
Model Investment Law and amendments to the Model Holding Company System
Regulatory Act (the "Holding Act Amendments"). The Model Investment Law defines
the investments which are permissible for life insurers to hold, and the Holding
Act Amendments address the types of activities in which subsidiaries and
affiliates may engage. The NAIC adopted these models in 1997 and 1996, but the
laws have not been enacted for insurance companies domiciled in the State of
Connecticut, such as Hartford Life. Even if enacted in Connecticut or other
states in which Hartford Life's insurance subsidiaries are domiciled, it is
expected that these laws will neither significantly change Hartford Life's
investment strategies nor have any material adverse effect on Hartford Life's
liquidity or financial position.

The NAIC adopted the Codification of Statutory Accounting Principles (SAP) in
March 1998. The proposed effective date for the statutory accounting guidance is
January 1, 2001. It is expected that each of Hartford Life's domiciliary states
will adopt the SAP and the Company will make the necessary changes required for
implementation. The Company has not yet determined the impact that the SAP will
have on the statutory financial statements of the insurance subsidiaries of
Hartford Life.

DEPENDENCE ON CERTAIN THIRD PARTY RELATIONSHIPS

Hartford Life distributes its annuity and life insurance products through a
variety of distribution channels, including broker-dealers, banks, wholesalers,
its own internal sales force and other third party marketing organizations. The
Company periodically negotiates provisions and renewals of these relationships
and there can be no assurance that such terms will remain acceptable to the
Company or such service providers. An interruption in the Company's continuing
relationship with certain of these third parties could materially affect the
Company's ability to market its products. During the first quarter of 1999, the
Company modified its contract with Putnam Mutual Funds Corp. (Putnam) to
eliminate the exclusivity provision, which will allow both parties to pursue new
market opportunities. Putnam is contractually obligated to support and service
the related annuity in force block of business and to market, support and
service new business. However, there can be no assurance that this contract
modification will not adversely impact the Company's ability to distribute
Putnam-related products.

YEAR 2000

In General

The Year 2000 issue relates to the ability or inability of computer hardware,
software and other information technology (IT) systems, as well as non-IT
systems, such as equipment and machinery with imbedded chips and
microprocessors, to properly process information and data containing or related
to dates beginning with the Year 2000 and beyond. The Year 2000 issue exists
because, historically, many IT and non-IT systems that are in use today were
developed years ago when a year was identified using a two-digit date field
rather than a four-digit date field. As information and data containing or
related to the century date are introduced to date sensitive systems, these
systems may recognize the Year 2000 as "1900," or not at all, which may result
in systems processing information incorrectly. This, in turn, may significantly
and adversely affect the integrity and reliability of information databases of
IT systems, may cause the malfunctioning of certain non-IT systems, and may
result in a wide variety of adverse consequences to a company. In addition, Year
2000 problems that occur with third parties with which a company does business,
such as suppliers, computer vendors, distributors and others, may also adversely
affect any given company.

The integrity and reliability of Hartford Life's IT systems, as well as the
reliability of its non-IT systems, are integral aspects of Hartford Life's
business. Hartford Life issues insurance policies, annuities, mutual funds and
other financial products to individual and business customers, nearly all of
which contain date sensitive payment dates. In addition, various IT systems
support communications and other systems that integrate Hartford Life's various
business segments and field offices, including Hartford Life's foreign
operations. Hartford Life also has business relationships with numerous third
parties that affect virtually all aspects of Hartford Life's business,
including, without limitation, suppliers, computer hardware and software
vendors, insurance agents and brokers, securities broker-dealers, banks and
other distributors and servicers of financial products, many of which provide
date sensitive data to Hartford Life and whose operations are important to
Hartford Life's business.

Internal and Third Party Year 2000 Efforts

Beginning in 1990, Hartford Life began working on making its IT systems Year
2000 ready, either through installing new programs or replacing systems. These
efforts were substantially completed by the end of 1999, including the internal
and external integrated testing of such systems. In addition, Hartford Life's
Year 2000 efforts included assessing the potential impact on Hartford Life of
third parties' Year 2000 readiness.


                                       34
<PAGE>   35
Status and Contingency Plans

As of February 29, 2000, Hartford Life had not experienced any Year 2000 -
related business interruptions arising either from its own systems or those of
third parties. However, Hartford Life has developed certain contingency plans so
that if, despite its Year 2000 efforts, Year 2000 problems ultimately arise, the
impact of such problems may be avoided or minimized. The contingency planning
process involved identifying reasonably likely business disruption scenarios
that, if they were to occur, could create significant problems in the critical
functions of each business segment. Each business segment has developed plans to
respond to such problems so that critical business functions may continue to
operate with minimal disruption. Contingency planning also included assessing
the dependency of Hartford Life's critical business on third parties and their
Year 2000 readiness. These plans were reviewed and simulated on an integrated
basis, where appropriate, and will continue to be evaluated. Furthermore, in
many contexts, Year 2000 issues are dynamic, and ongoing assessments of business
functions, vulnerabilities and risks must be made. As such, new contingency
plans may be needed in the future and/or existing plans may need to be modified
as circumstances warrant.

Year 2000 Costs

The after-tax costs of Hartford Life's Year 2000 efforts that were incurred
prior to January 1, 1998 were not material to Hartford Life's financial
condition or results of operations. For the years ended December 31, 1999 and
1998, the after-tax costs were approximately $3 and $4, respectively. These
costs were expensed as incurred. Hartford Life does not expect to incur
significant costs in the year 2000 related to its Year 2000 efforts.


EFFECT OF INFLATION

The rate of inflation as measured by the change in the average consumer price
index has not had a material effect on the revenues or operating results of
Hartford Life during the three most recent fiscal years.


ACCOUNTING STANDARDS

For a discussion of accounting standards, see Note 2 of Notes to Consolidated
Financial Statements.


                                       35
<PAGE>   36
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

The information called for by Item 7A is set forth in the Capital Markets Risk
Management section of the Management's Discussion and Analysis of Financial
Condition and Results of Operations and is incorporated herein by reference.

ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

See Index to Consolidated Financial Statements and Schedules elsewhere herein.

ITEM 9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
         FINANCIAL DISCLOSURE

None.

PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF HARTFORD LIFE

Certain of the information called for by Item 10 is set forth in the definitive
proxy statement for the 2000 annual meeting of shareholders (the "Proxy
Statement") filed or to be filed by Hartford Life with the Securities and
Exchange Commission within 120 days after the end of the fiscal year covered by
this Form 10-K under the caption "Item 1. Election of Directors" and "The Board
of Directors and Its Committees" and is incorporated herein by reference.
Additional information required by Item 10 regarding Hartford Life's executive
officers is set forth in Item 1 of this Form 10-K under the caption "Executive
Officers of Hartford Life" and is incorporated herein by reference.

ITEM 11. EXECUTIVE COMPENSATION

The information called for by Item 11 is set forth in the Proxy Statement under
the captions "Compensation of Executive Officers", "The Board of Directors and
its Committees - Directors' Compensation" and "Compensation Committee Interlocks
and Insider Participation" and is incorporated herein by reference.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The information called for by Item 12 is set forth in the Proxy Statement under
the caption "Stock Ownership of Directors, Executive Officers and Certain
Shareholders" and is incorporated herein by reference.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

The information called for by Item 13 is set forth in the Proxy Statement under
the caption "Certain Relationships with The Hartford" and is incorporated herein
by reference.

PART IV

ITEM 14. EXHIBITS, FINANCIAL STATEMENTS, SCHEDULES AND REPORTS ON FORM 8-K

(a)  Documents filed as a part of this report:

     1. CONSOLIDATED FINANCIAL STATEMENTS. See Index to Consolidated Financial
Statements and Schedules elsewhere herein.

     2. CONSOLIDATED FINANCIAL STATEMENT SCHEDULES. See Index to Consolidated
Financial Statement and Schedules elsewhere herein.

     3. EXHIBITS. See Exhibit Index elsewhere herein.

(b) Reports on Form 8-K - None.

(c) See Item 14(a)(3).

(d) See Item 14(a)(2).


                                       36
<PAGE>   37
            INDEX TO CONSOLIDATED FINANCIAL STATEMENTS AND SCHEDULES


<TABLE>
<CAPTION>
                                                                                             Page(s)
<S>                                                                                          <C>
Report of Management                                                                          F-1
Report of Independent Public Accountants                                                      F-2
Consolidated Statements of Income for the years ended December 31, 1999, 1998 and 1997        F-3
Consolidated Balance Sheets as of December 31, 1999 and 1998                                  F-4
Consolidated Statements of Changes in Stockholders' Equity for the years ended
    December 31, 1999, 1998 and 1997                                                          F-5
Consolidated Statements of Cash Flows for the years ended December 31, 1999, 1998 and 1997    F-6
Notes to Consolidated Financial Statements                                                    F-7 - 26
Schedule I  --  Summary of Investments - Other Than Investments in Affiliates                 S-1
Schedule II  -- Condensed Financial Information of Hartford Life, Inc.                        S-2 - 3
Schedule III -- Supplementary Insurance Information                                           S-4
Schedule IV -- Reinsurance                                                                    S-5
Schedule V  -- Valuation and Qualifying Accounts                                              S-6
</TABLE>



                              REPORT OF MANAGEMENT


The management of Hartford Life, Inc. (Hartford Life) is responsible for the
preparation and integrity of information contained in the accompanying
Consolidated Financial Statements and other sections of the Annual Report. The
Consolidated Financial Statements are prepared in accordance with generally
accepted accounting principles, and, where necessary, include amounts that are
based on management's informed judgments and estimates. Management believes
these consolidated statements present fairly Hartford Life's financial position
and results of operations, and, that any other information contained in the
Annual Report is consistent with the Consolidated Financial Statements.

Management has made available Hartford Life's financial records and related data
to Arthur Andersen LLP, independent public accountants, in order for them to
perform an audit of Hartford Life's Consolidated Financial Statements. Their
report appears on page F-2.

An essential element in meeting management's financial responsibilities is
Hartford Life's system of internal controls. These controls, which include
accounting controls and the internal auditing program, are designed to provide
reasonable assurance that assets are safeguarded, and transactions are properly
authorized, executed and recorded. The controls, which are documented and
communicated to employees in the form of written codes of conduct and policies
and procedures, provide for careful selection of personnel and for appropriate
division of responsibility. Management continually monitors for compliance,
while Hartford Life's internal auditors independently assess the effectiveness
of the controls and make recommendations for improvement. Also, Arthur Andersen
LLP took into consideration Hartford Life's system of internal controls in
determining the nature, timing and extent of their audit tests.

Another important element is management's recognition of its responsibility for
fostering a strong, ethical climate, thereby ensuring that Hartford Life's
affairs are transacted according to the highest standards of personal and
professional conduct. Hartford Life has a long-standing reputation of integrity
in business conduct and utilizes communication and education to create and
fortify a strong compliance culture.

The Audit Committee of the Board of Directors of Hartford Life (the
"Committee"), composed of independent directors, meets periodically with the
external and internal auditors to evaluate the effectiveness of work performed
by them in discharging their respective responsibilities and to ensure their
independence and free access to the Committee.


                                      F-1
<PAGE>   38
                    REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS


TO HARTFORD LIFE, INC.:

We have audited the accompanying Consolidated Balance Sheets of Hartford Life,
Inc. (Hartford Life) (a Delaware corporation) and subsidiaries as of December
31, 1999 and 1998, and the related Consolidated Statements of Income, Changes in
Stockholders' Equity and Cash Flows for each of the three years in the period
ended December 31, 1999. These Consolidated Financial Statements and the
schedules referred to below are the responsibility of Hartford Life's
management. Our responsibility is to express an opinion on these financial
statements and schedules based on our audits.

We conducted our audits in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.

In our opinion, the Consolidated Financial Statements referred to above present
fairly, in all material respects, the financial position of Hartford Life and
subsidiaries as of December 31, 1999 and 1998, and the results of their
operations and their cash flows for each of the three years in the period ended
December 31, 1999 in conformity with accounting principles generally accepted in
the United States.

Our audits were made for the purpose of forming an opinion on the basic
financial statements taken as a whole. The schedules listed in the Index to
Consolidated Financial Statements and Schedules are presented for the purpose of
complying with the Securities and Exchange Commission's rules and are not part
of the basic financial statements. These schedules have been subjected to the
auditing procedures applied in the audits of the basic financial statements and,
in our opinion, fairly state in all material respects the financial data
required to be set forth therein in relation to the basic financial statements
taken as a whole.



                                               ARTHUR ANDERSEN LLP

Hartford, Connecticut
January 31, 2000


                                      F-2
<PAGE>   39
                      HARTFORD LIFE, INC. AND SUBSIDIARIES
                        CONSOLIDATED STATEMENTS OF INCOME

<TABLE>
<CAPTION>
                                                         For the years ended December 31,
                                                       ----------------------------------
(In millions, except for per share data)                 1999          1998         1997
-----------------------------------------------------------------------------------------
<S>                                                    <C>           <C>          <C>
REVENUES
Premiums and other considerations                      $ 3,979       $ 3,833      $ 3,163
Net investment income                                    1,562         1,955        1,536
Net realized capital losses                                 (5)         --           --
-----------------------------------------------------------------------------------------
        TOTAL REVENUES                                   5,536         5,788        4,699
=========================================================================================
BENEFITS, CLAIMS AND EXPENSES
Benefits, claims and claim adjustment expenses           3,054         3,227        2,671
Amortization of deferred policy acquisition costs          568           441          345
Dividends to policyholders                                 104           330          241
Interest expense                                            67            58           58
Other expenses                                           1,057         1,147          904
-----------------------------------------------------------------------------------------
        TOTAL BENEFITS, CLAIMS AND EXPENSES              4,850         5,203        4,219
=========================================================================================
        INCOME BEFORE INCOME TAX EXPENSE                   686           585          480
Income tax expense                                         219           199          174
-----------------------------------------------------------------------------------------

        NET INCOME                                     $   467       $   386      $   306
=========================================================================================

Basic earnings per share (1)                           $  3.34       $  2.76      $  2.28
Diluted earnings per share (1)                         $  3.33       $  2.75      $  2.28
-----------------------------------------------------------------------------------------

Weighted average common shares outstanding (1)           139.9         140.0        134.0
Weighted average common shares outstanding and
  dilutive potential common shares (1)                   140.2         140.2        134.1
-----------------------------------------------------------------------------------------

Cash dividends declared per share (2)                  $  0.36       $  0.36      $  0.18
-----------------------------------------------------------------------------------------
</TABLE>

(1) Pro forma in 1997; see Note 10 of Notes to Consolidated Financial Statements
for further explanation.

(2) Cash dividends declared exclude amounts paid to the Company's parent prior
to the Company's Initial Public Offering (May 22, 1997).


                 SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.


                                      F-3
<PAGE>   40
                      HARTFORD LIFE, INC. AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>
                                                                             As of December 31,
                                                                         -------------------------
(In millions, except for share data)                                        1999            1998
--------------------------------------------------------------------------------------------------
<S>                                                                      <C>             <C>
ASSETS
Investments
Fixed maturities, available for sale, at fair value
    (amortized cost of $17,602 and $17,271)                              $  17,035       $  17,692
Equity securities, at fair value                                               153             140
Policy loans, at outstanding balance                                         4,222           6,687
Other investments                                                              376             363
--------------------------------------------------------------------------------------------------
    Total investments                                                       21,786          24,882
Cash                                                                            89              36
Premiums receivable and agents' balances                                       214             166
Reinsurance recoverables                                                       449             900
Deferred policy acquisition costs                                            4,210           3,842
Deferred income tax                                                            522             456
Other assets                                                                 1,111           1,112
Separate account assets                                                    110,652          90,628
--------------------------------------------------------------------------------------------------
             TOTAL ASSETS                                                $ 139,033       $ 122,022
             =====================================================================================

LIABILITIES
Future policy benefits                                                   $   6,236       $   5,717
Other policyholder funds                                                    16,873          19,767
Long-term debt                                                                 650             650
Company obligated mandatorily redeemable preferred
    securities of subsidiary trust holding solely
    parent junior subordinated debentures                                      250             250
Other liabilities                                                            2,066           2,517
Separate account liabilities                                               110,652          90,628
--------------------------------------------------------------------------------------------------
        TOTAL LIABILITIES                                                  136,727         119,529
        ==========================================================================================

STOCKHOLDERS' EQUITY
Class A common stock - 600,000,000 shares authorized;
    26,122,383 and 26,077,320 shares issued, par value $0.01                  --              --
Class B common stock - 600,000,000 shares authorized;
    114,000,000 shares issued and outstanding, par value $0.01                   1               1
Capital surplus                                                              1,282           1,281
Treasury stock, at cost - 208,536 and 161,984 shares                           (10)             (9)
Accumulated other comprehensive income (loss)
    Net unrealized capital gains (losses) on securities, net of tax           (336)            263
    Cumulative translation adjustments                                         (12)             (7)
                                                                                         ---------
   Total accumulated other comprehensive income (loss)                        (348)            256
                                                                                         ---------
Retained earnings                                                            1,381             964
--------------------------------------------------------------------------------------------------
        TOTAL STOCKHOLDERS' EQUITY                                           2,306           2,493
        ==========================================================================================
             TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                  $ 139,033       $ 122,022
        ==========================================================================================
</TABLE>


                 SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.


                                      F-4
<PAGE>   41
                      HARTFORD LIFE, INC. AND SUBSIDIARIES
           CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY

<TABLE>
<CAPTION>
                                                                                  ACCUMULATED OTHER
                                                                                 COMPREHENSIVE INCOME
                                                                                        (LOSS)
                                                                               ------------------------
                                                                                  NET
                                                                               UNREALIZED
                                                                                CAPITAL
                                                                                 GAINS
                                                                                (LOSSES)
                                       CLASS A    CLASS B            TREASURY      ON       CUMULATIVE                 TOTAL
                                       COMMON     COMMON    CAPITAL   STOCK,   SECURITIES,  TRANSLATION  RETAINED  STOCKHOLDERS'
   (In millions)                        STOCK      STOCK    SURPLUS  AT COST   NET OF TAX   ADJUSTMENTS  EARNINGS     EQUITY
--------------------------------------------------------------------------------------------------------------------------------
<S>                                    <C>        <C>       <C>      <C>       <C>          <C>          <C>       <C>
1999

Balance, December 31, 1998              $  -       $  1      $1,281   $ (9)     $ 263         $ (7)       $  964       $2,493
Comprehensive income (loss)
Net income                                                                                                   467          467
                                                                                                                       ------
Other comprehensive income (loss),
 net of tax (1)
   Net unrealized capital losses on
    securities (2)                                                               (599)                                   (599)
   Cumulative translation
   adjustments                                                                                  (5)                        (5)
                                                                                                                       ------
Total other comprehensive income
   (loss)                                                                                                                (604)
                                                                                                                       ------
   Total comprehensive income (loss)                                                                                     (137)
                                                                                                                       ------
Dividends declared                                                                                           (50)         (50)
Issuance of shares under incentive
   and stock purchase plans                                       1      9                                                 10
Treasury stock acquired                                                (10)                                               (10)
-----------------------------------------------------------------------------------------------------------------------------
   BALANCE, DECEMBER 31, 1999           $  -       $  1      $1,282   $(10)     $(336)        $(12)       $1,381       $2,306
=============================================================================================================================

1998

Balance, December 31, 1997              $  -       $  1      $1,283   $ (1)     $ 237         $ (4)       $  628       $2,144
Comprehensive income
Net income                                                                                                   386          386
                                                                                                                       ------
Other comprehensive income, net of
   tax (1)
   Net unrealized capital gains  on
    securities (2)                                                                 26                                      26
   Cumulative translation
   adjustments                                                                                  (3)                        (3)
                                                                                                                       ------
Total other comprehensive income                                                                                           23
                                                                                                                       ------
   Total comprehensive income                                                                                             409
                                                                                                                       ------
Dividends declared                                                                                           (50)         (50)
Issuance of shares under incentive
   and stock purchase plans                                      (2)     7                                                  5
Treasury stock acquired                                                (15)                                               (15)
-----------------------------------------------------------------------------------------------------------------------------
   BALANCE, DECEMBER 31, 1998           $  -       $  1      $1,281   $ (9)     $ 263         $ (7)       $  964       $2,493
=============================================================================================================================

1997

Balance, December 31, 1996              $  -       $  -     $   585   $  -      $  29         $ (3)       $ 663        $1,274
Comprehensive income
Net income                                                                                                   306          306
                                                                                                                       ------
Other comprehensive income, net of
   tax (1)
   Net unrealized capital gains  on
    securities (2)                                                                208                                     208
   Cumulative translation
    adjustments                                                                                 (1)                        (1)
                                                                                                                       ------
Total other comprehensive income                                                                                          207
                                                                                                                       ------
   Total comprehensive income                                                                                             513
                                                                                                                       ------
Issuance of Class A Common Stock                                687                                                       687
Conversion to Class B Common Stock                    1          (1)                                                        -
Capital contribution                                             12                                                        12
Dividends                                                                                                   (341)        (341)
Issuance of shares under incentive
   and stock purchase plans                                              3                                                  3
Treasury stock acquired                                                 (4)                                                (4)
-----------------------------------------------------------------------------------------------------------------------------
   BALANCE, DECEMBER 31, 1997           $  -       $  1      $1,283   $ (1)     $ 237         $ (4)       $  628       $2,144
=============================================================================================================================
</TABLE>

(1)  Net unrealized capital gains (losses) on securities is reflected net of tax
     (benefit) provision of $(326), $14 and $112 for the years ended December
     31, 1999, 1998 and 1997, respectively. There is no tax effect on cumulative
     translation adjustments.

(2)  There were no reclassification adjustments for after-tax gains (losses)
     realized in net income for the years ended December 31, 1999, 1998 and
     1997.

                 SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.


                                      F-5
<PAGE>   42
                      HARTFORD LIFE, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS

<TABLE>
<CAPTION>
                                                                                        For the years ended December 31,
                                                                                      -----------------------------------
(In millions)                                                                           1999          1998          1997
-------------------------------------------------------------------------------------------------------------------------
<S>                                                                                   <C>           <C>           <C>
OPERATING ACTIVITIES
Net income                                                                            $   467       $   386       $   306
ADJUSTMENTS TO RECONCILE NET INCOME TO NET CASH PROVIDED BY OPERATING ACTIVITIES
Depreciation and amortization                                                               7            30            23
Net realized capital losses                                                                 5          --            --
(Increase) decrease in premiums receivable and agents' balances                           (48)          (19)           23
(Decrease) increase in other liabilities                                                 (251)           (4)          258
Change in receivables, payables and accruals                                              150            67            87
(Decrease) increase in accrued tax                                                       (159)           43           143
Decrease (increase) in deferred income tax                                                251           (71)           37
Increase in deferred policy acquisition costs                                            (395)         (481)         (561)
Increase in future policy benefits                                                        710           778           956
Decrease (increase) in reinsurance recoverables                                            74           (98)         (115)
Other, net                                                                                (87)           36           (10)
-------------------------------------------------------------------------------------------------------------------------
      NET CASH PROVIDED BY OPERATING ACTIVITIES                                           724           667         1,147
=========================================================================================================================
INVESTING ACTIVITIES
Purchases of investments                                                               (7,194)       (7,846)       (8,499)
Sales of investments                                                                    7,267         6,247         5,360
Maturity of investments                                                                 1,938         1,885         2,513
Purchases of affiliates and other                                                        (104)         (199)          (24)
-------------------------------------------------------------------------------------------------------------------------
      NET CASH PROVIDED BY (USED FOR) INVESTING ACTIVITIES                              1,907            87          (650)
=========================================================================================================================
FINANCING ACTIVITIES
(Decrease) increase in short-term debt                                                   --             (50)           50
Proceeds from issuance of long-term debt                                                 --            --             650
Decrease in allocated advances from parent                                               --            --            (893)
Proceeds from issuance of company obligated mandatorily redeemable preferred
    securities of subsidiary trust holding solely
    parent junior subordinated debentures                                                --             250          --
Dividends paid                                                                            (50)          (38)         (329)
Net disbursements for investment and universal life-type contracts charged
    against policyholder accounts                                                      (2,527)         (957)         (644)
Net proceeds from the sale of common stock                                               --            --             687
Net issuance of common stock                                                               (1)           (8)           (1)
-------------------------------------------------------------------------------------------------------------------------
      NET CASH USED FOR FINANCING ACTIVITIES                                           (2,578)         (803)         (480)
=========================================================================================================================
Net increase (decrease) in cash                                                            53           (49)           17
Impact of foreign exchange                                                               --              (3)           (1)
Cash - beginning of year                                                                   36            88            72
-------------------------------------------------------------------------------------------------------------------------
      CASH - END OF YEAR                                                              $    89       $    36       $    88
=========================================================================================================================

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
NET CASH PAID DURING THE YEAR FOR
Income taxes                                                                          $    51       $   257       $    45
Interest                                                                              $    65       $    54       $    55

NONCASH INVESTING AND FINANCING ACTIVITIES
Capital contribution                                                                  $  --         $  --         $    12
</TABLE>

In 1998, due to the recapture of an in force block of business previously ceded
to MBL Life Assurance Co. of New Jersey, reinsurance recoverables of $4,753 were
exchanged for the fair value of assets comprised of $4,310 in policy loans and
$443 in other net assets.

                 SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS.


                                      F-6
<PAGE>   43
                      HARTFORD LIFE, INC. AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

  (Dollar amounts in millions, except for share data, unless otherwise stated)


1.  ORGANIZATION AND DESCRIPTION OF BUSINESS

Hartford Life, Inc. (a Delaware corporation), together with its consolidated
subsidiaries ("Hartford Life" or the "Company"), is a leading financial services
and insurance organization which provides, primarily in the United States,
investment, retirement, estate planning and employee benefits products. Hartford
Life, Inc. was formed on December 13, 1996 and capitalized on December 16, 1996
with the contribution of all the outstanding common stock of Hartford Life and
Accident Insurance Company (HLA). Pursuant to an initial public offering ("IPO"
or "the Offering") of 26 million shares of the Company's Class A Common Stock on
May 22, 1997, Hartford Life became a publicly traded company (see Note 3). The
Company is a direct subsidiary of Hartford Accident and Indemnity Company (HA&I)
and is ultimately a subsidiary of The Hartford Financial Services Group, Inc.
(The Hartford). Hartford Life, Inc. is a holding company and as such has no
material business of its own.


2.  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(a) BASIS OF PRESENTATION

These Consolidated Financial Statements are prepared on the basis of accounting
principles generally accepted in the United States, which differ materially from
the statutory accounting practices prescribed by various insurance regulatory
authorities. All material intercompany transactions and balances between
Hartford Life, its subsidiaries and affiliates have been eliminated.

The preparation of financial statements, in conformity with accounting
principles generally accepted in the United States, requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those estimates.
The most significant estimates include those used in determining deferred policy
acquisition costs and the liability for future policy benefits and other
policyholder funds. Although some variability is inherent in these estimates,
management believes the amounts provided are adequate.

Certain reclassifications have been made to prior year financial information to
conform to the current year presentation.

(b) ADOPTION OF NEW ACCOUNTING STANDARDS

Effective January 1, 1999, Hartford Life adopted Statement of Position (SOP) No.
98-1, "Accounting for the Costs of Computer Software Developed or Obtained for
Internal Use". This SOP provides guidance on accounting for the costs of
internal use software and in determining whether the software is for internal
use. The SOP defines internal use software as software that is acquired,
internally developed, or modified solely to meet internal needs and identifies
stages of software development and accounting for the related costs incurred
during the stages. Adoption of this SOP did not have a material impact on the
Company's financial condition or results of operations.

Effective January 1, 1999, Hartford Life adopted SOP No. 97-3, "Accounting by
Insurance and Other Enterprises for Insurance-Related Assessments". This SOP
addresses accounting by insurance and other enterprises for assessments related
to insurance activities, including recognition, measurement and disclosure of
guaranty fund or other assessments. Adoption of this SOP did not have a material
impact on the Company's financial condition or results of operations.

The Company's cash flows were not impacted by these changes in accounting
principles.


                                      F-7
<PAGE>   44
(c) FUTURE ADOPTION OF NEW ACCOUNTING STANDARDS

In June 1999, the Financial Accounting Standards Board (FASB) issued Statement
of Financial Accounting Standards (SFAS) No. 137, "Accounting for Derivative
Instruments and Hedging Activities - Deferral of the Effective Date of FASB
Statement No. 133". This statement amends SFAS No. 133, "Accounting for
Derivative Instruments and Hedging Activities", to defer its effective date for
one year, to fiscal years beginning after June 15, 2000. Initial application for
Hartford Life will begin January 1, 2001. SFAS No. 133 establishes accounting
and reporting guidance for derivative instruments, including certain derivative
instruments embedded in other contracts. The standard requires, among other
things, that all derivatives be carried on the balance sheet at fair value. The
standard also specifies hedge accounting criteria under which a derivative can
qualify for special accounting. In order to receive special accounting, the
derivative instrument must qualify as either a hedge of the fair value or the
variability of the cash flow of a qualified asset or liability. Special
accounting for qualifying hedges provides for matching the timing of gain or
loss recognition on the hedging instrument with the recognition of the
corresponding changes in value of the hedged item. The Company has reviewed its
derivative holdings and is in the process of quantifying the impact of SFAS No.
133. The Company is also assessing what actions, if any, need to be taken to
minimize potential volatility, while at the same time maintaining the economic
protection needed to support the goals of its business.

In October 1998, the American Institute of Certified Public Accountants (AICPA)
issued SOP 98-7, "Accounting for Insurance and Reinsurance Contracts That Do Not
Transfer Insurance Risk". This SOP provides guidance on the method of accounting
for insurance and reinsurance contracts that do not transfer insurance risk,
defined in the SOP as the deposit method. This SOP is effective for financial
statements for fiscal years beginning after June 15, 1999 and is not expected to
have a material impact on the Company's financial condition or results of
operations.

(d) REVENUE RECOGNITION

Revenues for investment products and universal life-type policies consist of
policy charges for policy administration, cost of insurance and surrender
charges assessed to policy account balances and are recognized in the period in
which services are provided. Premiums for traditional life insurance and
disability policies are recognized as revenues ratably over the policy period.

(e) DIVIDENDS TO POLICYHOLDERS

Certain life insurance policies contain dividend payment provisions that enable
the policyholder to participate in the earnings on that participating block of
business of the life insurance subsidiaries of the Company. The participating
insurance in force accounted for 20%, 22% and 20% in 1999, 1998 and 1997,
respectively, of total insurance in force.

(f) INVESTMENTS

Hartford Life's investments in both fixed maturities, which include bonds,
redeemable preferred stock and commercial paper, and equity securities, which
include common and non-redeemable preferred stocks, are classified as "available
for sale" in accordance with SFAS No. 115, "Accounting for Certain Investments
in Debt and Equity Securities". Accordingly, these securities are carried at
fair value with the after-tax difference from cost reflected in stockholders'
equity as a component of accumulated other comprehensive income. Policy loans
are carried at outstanding balance which approximates fair value. Other invested
assets primarily consist of partnership investments, which are accounted for by
the equity method, and mortgage loans, whereby the carrying value approximates
fair value. Realized capital gains and losses on security transactions
associated with the Company's immediate participation guaranteed contracts are
excluded from revenues and deferred over the expected maturity of the
securities, since under the terms of the contracts the realized gains and losses
will be credited to policyholders in future years as they are entitled to
receive them. Net realized capital gains and losses, excluding those related to
immediate participation guaranteed contracts, are reported as a component of
revenue and are determined on a specific identification basis.

The Company's accounting policy for impairment requires recognition of an other
than temporary impairment charge on a security if it is determined that the
Company is unable to recover all amounts due under the contractual obligations
of the security. In addition, for securities expected to be sold, an other than
temporary impairment charge is recognized if the Company does not expect the
fair value of a security to recover to cost or amortized cost prior to the
expected date of sale. Once an impairment charge has been recorded, the Company
then continues to review the other than temporarily impaired securities for
additional impairment, if necessary.


                                      F-8
<PAGE>   45
(g) DERIVATIVE INSTRUMENTS

HEDGE ACCOUNTING -- Hartford Life uses a variety of derivative instruments,
including swaps, caps, floors, forwards and exchange traded financial futures
and options as part of an overall risk management strategy. These instruments
are used as a means of hedging exposure to price, foreign currency and/or
interest rate risk on planned investment purchases or existing assets and
liabilities. Hartford Life does not hold or issue derivative instruments for
trading purposes. Hartford Life's accounting for derivative instruments used to
manage risk is in accordance with the concepts established in SFAS No. 80,
"Accounting for Futures Contracts", SFAS No. 52, "Foreign Currency Translation",
AICPA SOP 86-2, "Accounting for Options" and various Emerging Issues Task Force
pronouncements. Written options are used, in all cases in conjunction with other
assets and derivatives, as part of the Company's asset and liability management
strategy. Derivative instruments are carried at values consistent with the asset
or liability being hedged. Derivative instruments used to hedge fixed maturities
or equity securities are carried at fair value with the after-tax difference
from cost reflected in stockholders' equity. Derivative instruments used to
hedge other invested assets or liabilities are carried at cost. For a discussion
of SFAS No. 133, "Accounting for Derivative Instruments and Hedging Activities",
issued in June 1998, see (c) Future Adoption of New Accounting Standards.

Derivative instruments must be designated at inception as a hedge and measured
for effectiveness both at inception and on an ongoing basis. Hartford Life's
correlation threshold for hedge designation is 80% to 120%. If correlation,
which is assessed monthly or quarterly and measured based on a rolling three
month average, falls outside the 80% to 120% range, hedge accounting will be
terminated. Derivative instruments used to create a synthetic asset must meet
synthetic accounting criteria, including designation at inception and
consistency of terms between the synthetic and the instrument being replicated.
Consistent with industry practice, synthetic instruments are accounted for like
the financial instrument they are intended to replicate. Derivative instruments
which fail to meet risk management criteria, subsequent to acquisition, are
marked to market with the impact reflected in the Consolidated Statements of
Income.

FUTURES -- Gains or losses on financial futures contracts entered into in
anticipation of the investment of future receipt of product cash flows are
deferred and, at the time of the ultimate investment purchase, reflected as an
adjustment to the cost basis of the purchased asset. Gains or losses on futures
used in invested asset risk management are deferred and adjusted into the cost
basis of the hedged asset when the contract futures are closed, except for
futures used in duration hedging, which are deferred and basis adjusted on a
quarterly basis. The basis adjustments are amortized into net investment income
over the remaining asset life.

FORWARD COMMITMENTS -- Open forward commitment contracts are marked to market
through stockholders' equity. Such contracts are accounted for at settlement by
recording the purchase of the specified securities at the previously committed
price. Gains or losses resulting from the termination of forward commitment
contracts are recognized immediately in the Consolidated Statements of Income as
a component of net investment income.

OPTIONS -- The cost of options entered into as part of a risk management
strategy are basis adjusted to the underlying asset or liability and amortized
over the remaining life of the option. Gains or losses on expiration or
termination are adjusted into the basis of the underlying asset or liability and
amortized over the remaining asset life.

INTEREST RATE SWAPS -- Interest rate swaps involve the periodic exchange of
payments without the exchange of underlying principal or notional amounts. Net
receipts or payments are accrued and recognized over the life of the swap
agreement as an adjustment to investment income. Should the swap be terminated,
the gain or loss is adjusted into the basis of the asset or liability and
amortized over the remaining life. Should the hedged asset be sold or liability
terminated without terminating the swap position, any swap gains or losses are
immediately recognized in earnings. Interest rate swaps purchased in
anticipation of an asset purchase (anticipatory transaction) are recognized
consistent with the underlying asset components such that the settlement
component is recognized in the Consolidated Statements of Income while the
change in market value is recognized as an unrealized capital gain or loss.

INTEREST RATE CAPS AND FLOORS -- Premiums paid on purchased cap or floor
agreements and the premium received on issued cap or floor agreements (used for
risk management) are adjusted into the basis of the applicable asset and
amortized over the asset life. Gains or losses on termination of such positions
are adjusted into the basis of the asset or liability and amortized over the
remaining asset life. Net payments are recognized as an adjustment to income or
basis adjusted and amortized depending on the specific hedge strategy.

FORWARD EXCHANGE AND CURRENCY SWAPS CONTRACTS -- Forward exchange contracts and
foreign currency swaps are accounted for in accordance with SFAS No. 52. Changes
in the spot rate of instruments designated as hedges of the net investment in a
foreign subsidiary are reflected in the cumulative translation adjustment
component of stockholders' equity.

Cash flows from futures, options and swaps, accounted for as hedges, are
included with the cash flows of the item being hedged.


                                      F-9
<PAGE>   46
(h) SEPARATE ACCOUNTS

Hartford Life maintains separate account assets and liabilities which are
reported at fair value. Separate account assets are segregated from other
investments. Separate accounts reflect two categories of risk assumption:
non-guaranteed separate accounts, wherein the policyholder assumes substantially
all the investment risk and rewards, and guaranteed separate accounts, wherein
the Company contractually guarantees either a minimum return or account value to
the policyholder.

(i) DEFERRED POLICY ACQUISITION COSTS

Policy acquisition costs, which include commissions and certain other expenses
associated with acquiring business, are deferred and amortized over the
estimated lives of the contracts, usually 20 years. Generally, acquisition costs
are deferred and amortized using the retrospective deposit method. Under the
retrospective deposit method, acquisition costs are amortized in proportion to
the present value of expected gross profits from surrender charges, investment
charges, mortality and expense margins. Actual gross profits can vary from
management's estimates, resulting in increases or decreases in the rate of
amortization. Management periodically updates these estimates, when appropriate,
and evaluates the recoverability of the deferred acquisition cost asset. When
appropriate, management revises its assumptions on the estimated gross profits
of these contracts and the cumulative amortization for the books of business are
re-estimated and adjusted by a cumulative charge or credit to income.

Acquisition costs and their related deferral are included in the Company's other
expenses as follows:

<TABLE>
<CAPTION>
                                          1999            1998            1997
-------------------------------------------------------------------------------
<S>                                     <C>             <C>             <C>
Commissions                             $ 1,152         $ 1,202         $ 1,073
Deferred acquisition costs                 (948)           (908)           (881)
Other                                       853             853             712
-------------------------------------------------------------------------------
    Total other expenses                $ 1,057         $ 1,147         $   904
===============================================================================
</TABLE>

(j) FUTURE POLICY BENEFITS

Liabilities for future policy benefits are computed by the net level premium
method using interest rate assumptions varying from 3% to 11% and withdrawal and
mortality assumptions appropriate at the time the policies were issued. Claim
reserves, which are the result of sales of group long-term and short-term
disability, stop loss and Medicare Supplement, are stated at amounts determined
by estimates on individual cases and estimates of unreported claims based on
past experience.

The following table displays the development of claim reserves (included in
future policy benefits on the Consolidated Balance Sheets) resulting primarily
from group disability products as of December 31, 1999, 1998 and 1997:


<TABLE>
<CAPTION>
                                              1999          1998          1997
-------------------------------------------------------------------------------
<S>                                         <C>           <C>           <C>
BEGINNING CLAIM RESERVES - GROSS            $ 1,938       $ 1,746       $ 1,496
Less: Reinsurance recoverables                  125            71            53
-------------------------------------------------------------------------------
BEGINNING CLAIM RESERVES - NET                1,813         1,675         1,443
-------------------------------------------------------------------------------
Incurred expenses related to:
    Current year                              1,013           902           890
    Prior years                                 (33)          (48)          (51)
-------------------------------------------------------------------------------
      Total incurred                            980           854           839
-------------------------------------------------------------------------------
Paid expenses related to:
    Current year                                360           334           274
    Prior years                                 430           382           333
-------------------------------------------------------------------------------
      Total paid                                790           716           607
-------------------------------------------------------------------------------
ENDING CLAIM RESERVES - NET                   2,003         1,813         1,675
Add: Reinsurance recoverables                   125           125            71
-------------------------------------------------------------------------------
      ENDING CLAIM RESERVES - GROSS         $ 2,128       $ 1,938       $ 1,746
===============================================================================
</TABLE>


                                      F-10
<PAGE>   47
(k) OTHER POLICYHOLDER FUNDS

Other policyholder funds include reserves for investment contracts without life
contingencies, corporate owned life insurance and universal life insurance
contracts. These reserves are based on account values, which represent the
balance that accrues to the benefit of policyholders.

(l) FOREIGN CURRENCY TRANSLATION

Foreign currency translation gains and losses are reflected in stockholders'
equity. Balance sheet accounts are translated at the exchange rates in effect at
each year end and income statement accounts are translated at the average rates
of exchange prevailing during the year. The national currencies of international
operations are generally their functional currencies.


3.  INITIAL PUBLIC OFFERING

Pursuant to the Offering on May 22, 1997, Hartford Life sold to the public 26
million shares of Class A Common Stock at $28.25 per share and received
proceeds, net of offering expenses, of $687. Of the proceeds, $527 was used to
retire outstanding promissory notes and an outstanding line of credit. The
remaining $160 was contributed to the Company's insurance subsidiaries to be
used for growth in the Company's core businesses.

The 26 million shares sold in the Offering represented approximately 18.6% of
the equity ownership in Hartford Life and approximately 4.4% of the combined
voting power of Hartford Life's Class A and Class B Common Stock. The Hartford
owns all the 114 million outstanding shares of Class B Common Stock of Hartford
Life, representing approximately 81.4% of the equity ownership in the Company
and approximately 95.6% of the combined voting power of Hartford Life's Class A
and Class B Common Stock. Holders of Class A Common Stock generally have
identical rights to the holders of Class B Common Stock except that the holders
of Class A Common Stock are entitled to one vote per share while holders of
Class B Common Stock are entitled to five votes per share on all matters
submitted to a vote of the Company's stockholders.

On April 3, 1997, the Company reclassified the authorized shares of common
stock, par value $0.01 per share, of the Company into Class B Common Stock, par
value $0.01 per share (the "Class B Common Stock"), and authorized Class A
Common Stock, par value $0.01 per share (the "Class A Common Stock") and
preferred stock, par value $0.01 per share (the "Preferred Stock").

Holders of Class A Common Stock and Class B Common Stock are entitled to receive
ratably such dividends, if any, as may be declared by the Board of Directors,
subject to any preferential dividend rights of any outstanding Preferred Stock,
and generally have identical voting rights as and vote together (not as separate
classes) with holders of Class B Common Stock, except that holders of Class A
Common Stock are entitled to one vote per share while holders of Class B Common
Stock are entitled to five votes per share. Also, each share of Class B Common
Stock is convertible into one share of Class A Common Stock (a) upon the
transfer of such share of Class B Common Stock by the holder thereof to a
non-affiliate (except where the shares of Class B Common Stock so transferred
represent 50% or more of all the outstanding shares of common stock, calculated
without regard to the difference in voting rights between the classes of common
stock) or (b) in the event that the number of shares of outstanding Class B
Common Stock is less than 50% of all the common stock then outstanding.


                                      F-11
<PAGE>   48
4.  INVESTMENTS AND DERIVATIVE INSTRUMENTS

<TABLE>
<CAPTION>
                                                                               For the years ended December 31,
                                                                             -----------------------------------
                                                                               1999          1998          1997
----------------------------------------------------------------------------------------------------------------
<S>                                                                          <C>           <C>           <C>
(a) COMPONENTS OF NET INVESTMENT INCOME

Interest income from fixed maturities                                        $ 1,121       $ 1,129       $ 1,094
Interest income from policy loans                                                391           789           425
Income from other investments                                                     66            53            35
----------------------------------------------------------------------------------------------------------------
Gross investment income                                                        1,578         1,971         1,554
Less: Investment expenses                                                         16            16            18
----------------------------------------------------------------------------------------------------------------
   NET INVESTMENT INCOME                                                     $ 1,562       $ 1,955       $ 1,536
================================================================================================================

(b) COMPONENTS OF NET REALIZED CAPITAL GAINS (LOSSES)

Fixed maturities                                                             $   (13)      $   (31)      $   (11)
Equity securities                                                                 12            21            12
Real estate and other                                                             (4)           10            (1)
----------------------------------------------------------------------------------------------------------------
   NET REALIZED CAPITAL LOSSES                                               $    (5)      $  --         $  --
================================================================================================================


(c) NET UNREALIZED CAPITAL GAINS (LOSSES) ON EQUITY SECURITIES

Gross unrealized capital gains                                               $    25       $    17       $    22
Gross unrealized capital losses                                                   (2)           (1)         --
----------------------------------------------------------------------------------------------------------------
Net unrealized capital gains                                                      23            16            22
Deferred income tax expense                                                        7             5             8
----------------------------------------------------------------------------------------------------------------
Net unrealized capital gains, net of tax                                          16            11            14
Balance - beginning of year                                                       11            14             4
----------------------------------------------------------------------------------------------------------------
   NET CHANGE IN UNREALIZED CAPITAL GAINS (LOSSES) ON EQUITY SECURITIES      $     5       $    (3)      $    10
================================================================================================================

(d) NET UNREALIZED CAPITAL GAINS (LOSSES) ON FIXED MATURITIES

Gross unrealized capital gains                                               $    70       $   546       $   461
Gross unrealized capital losses                                                 (637)         (125)          (88)
Unrealized capital (gains) losses credited to policyholders                       24           (32)          (30)
----------------------------------------------------------------------------------------------------------------
Net unrealized capital gains (losses)                                           (543)          389           343
Deferred income tax expense (benefit)                                           (191)          137           120
----------------------------------------------------------------------------------------------------------------
Net unrealized capital gains (losses), net of tax                               (352)          252           223
Balance - beginning of year                                                      252           223            25
----------------------------------------------------------------------------------------------------------------
   NET CHANGE IN UNREALIZED CAPITAL GAINS (LOSSES) ON FIXED MATURITIES       $  (604)      $    29       $   198
================================================================================================================
</TABLE>


                                      F-12
<PAGE>   49
(e) FIXED MATURITY INVESTMENTS

<TABLE>
<CAPTION>
                                                                                 As of December 31, 1999
                                                               -----------------------------------------------------------
                                                                                 Gross            Gross
                                                               Amortized      Unrealized       Unrealized
                                                                  Cost           Gains           Losses         Fair Value
--------------------------------------------------------------------------------------------------------------------------
<S>                                                            <C>            <C>              <C>              <C>
U.S. Government and Government agencies and authorities
  (guaranteed and sponsored)                                    $   228         $     5         $    (4)         $   229
U.S. Government and Government agencies and authorities
  (guaranteed and sponsored) - asset backed                       1,333               5             (40)           1,298
States, municipalities and political subdivisions                 1,346               2             (75)           1,273
Foreign governments                                                 347               8             (16)             339
Public utilities                                                    991               7             (41)             957
All other corporate, including international                      6,539              36            (292)           6,283
All other corporate - asset backed                                4,914               6            (153)           4,767
Short-term investments                                            1,346            --              --              1,346
Certificates of deposit                                             510               1             (14)             497
Redeemable preferred stock                                           48            --                (2)              46
------------------------------------------------------------------------------------------------------------------------
  TOTAL FIXED MATURITIES                                        $17,602         $    70         $  (637)         $17,035
========================================================================================================================
</TABLE>


<TABLE>
<CAPTION>
                                                                                      As of December 31, 1998
                                                               -----------------------------------------------------------
                                                                                  Gross           Gross
                                                               Amortized       Unrealized      Unrealized
                                                                 Cost             Gains           Losses        Fair Value
--------------------------------------------------------------------------------------------------------------------------
<S>                                                            <C>             <C>             <C>              <C>
  U.S. Government and Government agencies and authorities
    (guaranteed and sponsored)                                  $   164         $     2         $  --            $   166
  U.S. Government and Government agencies and authorities
    (guaranteed and sponsored) - asset backed                     1,138              24              (8)           1,154
  States, municipalities and political subdivisions               1,107              33              (1)           1,139
  Foreign governments                                               497              43             (10)             530
  Public utilities                                                  935              37              (3)             969
  All other corporate, including international                    6,170             320             (47)           6,443
  All other corporate - asset backed                              4,654              74             (47)           4,681
  Short-term investments                                          2,017               1              (1)           2,017
  Certificates of deposit                                           584              12              (8)             588
  Redeemable preferred stock                                          5            --              --                  5
------------------------------------------------------------------------------------------------------------------------
    TOTAL FIXED MATURITIES                                      $17,271         $   546         $  (125)         $17,692
========================================================================================================================
</TABLE>

The amortized cost and estimated fair value of fixed maturity investments as of
December 31, 1999 by estimated maturity year are shown below. Expected
maturities differ from contractual maturities due to call or prepayment
provisions. Asset backed securities, including mortgage backed securities and
collateralized mortgage obligations, are distributed to maturity year based on
the Company's estimates of the rate of future prepayments of principal over the
remaining lives of the securities. These estimates are developed using
prepayment speeds provided in broker consensus data. Such estimates are derived
from prepayment speeds experienced at the interest rate levels projected for the
applicable underlying collateral and can be expected to vary from actual
experience.


                                      F-13
<PAGE>   50
<TABLE>
<CAPTION>
MATURITY                                           Amortized Cost       Fair Value
----------------------------------------------------------------------------------
<S>                                                <C>                  <C>
One year or less                                      $ 2,759            $ 2,746
Over one year through five years                        5,570              5,476
Over five years through ten years                       4,098              3,920
Over ten years                                          5,175              4,893
--------------------------------------------------------------------------------
     TOTAL                                            $17,602            $17,035
================================================================================
</TABLE>

(f) SALES OF FIXED MATURITY AND EQUITY SECURITY INVESTMENTS

Sales of fixed maturities, excluding short-term fixed maturities, for the years
ended December 31, 1999, 1998 and 1997 resulted in proceeds of $3.8 billion,
$4.4 billion and $5.2 billion, gross realized capital gains of $178, $121 and
$175, gross realized capital losses (including writedowns) of $191, $152 and
$186, respectively. Sales of equity security investments for the years ended
December 31, 1999, 1998 and 1997 resulted in proceeds of $38, $39 and $132 and
gross realized capital gains of $12, $21 and $12, respectively, and no gross
realized capital losses for all periods.

(g) CONCENTRATION OF CREDIT RISK

The Company is not exposed to any significant concentration of credit risk in
fixed maturities of a single issuer greater than 10% of stockholders' equity.

(h) DERIVATIVE INSTRUMENTS

Hartford Life utilizes a variety of derivative instruments, including swaps,
caps, floors, forwards and exchange traded futures and options, in accordance
with Company policy and in order to achieve one of three Company approved
objectives: to hedge risk arising from interest rate, price or currency exchange
rate volatility; to manage liquidity; or, to control transactions costs. The
Company utilizes derivative instruments to manage market risk through four
principal risk management strategies: hedging anticipated transactions, hedging
liability instruments, hedging invested assets and hedging portfolios of assets
and/or liabilities. Hartford Life does not trade in these instruments for the
express purpose of earning trading profits.

The Company maintains a derivatives counterparty exposure policy which
establishes market based credit limits, favors long-term financial stability and
creditworthiness, and typically requires credit enhancement/credit risk reducing
agreements. Credit risk is measured as the amount owed to Hartford Life based on
current market conditions and potential payment obligations between the Company
and its counterparties. Credit exposures are quantified weekly and netted, and
collateral is pledged to or held by the Company to the extent the current value
of derivatives exceeds exposure policy thresholds.

The Company's derivative program is monitored by an internal compliance unit and
is reviewed by senior management. Notional amounts, which represent the basis
upon which pay or receive amounts are calculated and are not reflective of
credit risk, pertaining to derivative financial instruments (excluding the
Company's guaranteed separate account derivative investments), totaled $7.5
billion and $7.6 billion ($5.5 billion and $4.9 billion related to the Company's
investments, $2.0 billion and $2.7 billion on the Company's liabilities) as of
December 31, 1999 and 1998, respectively.


                                      F-14
<PAGE>   51
The tables below provide a summary of derivative instruments held by Hartford
Life as of December 31, 1999 and 1998, segregated by major investment and
liability category:

<TABLE>
<CAPTION>
1999                                                                     AMOUNT HEDGED (NOTIONAL AMOUNTS)
                                          ----------------------------------------------------------------------------------------
                                            Total                    Purchased                    Interest    Foreign      Total
                                          Carrying   Issued Caps    Caps, Floors                 Rate Swaps   Currency    Notional
ASSETS HEDGED                               Value     & Floors       & Options     Futures (1)   & Forwards   Swaps (2)    Amount
----------------------------------------------------------------------------------------------------------------------------------
<S>                                       <C>        <C>            <C>            <C>           <C>          <C>         <C>
Asset backed securities
   (excluding anticipatory)               $  6,065     $   --         $     15       $   --       $    931    $   --      $    946
Anticipatory (3)                              --           --             --               13          232        --           245
Other bonds and notes                        9,624          505            681           --          3,008          83       4,277
Short-term investments                       1,346         --             --             --           --          --          --
----------------------------------------------------------------------------------------------------------------------------------
     TOTAL FIXED MATURITIES                 17,035          505            696             13        4,171          83       5,468
Equity securities, policy loans and
  other investments                          4,751         --             --             --           --          --          --
----------------------------------------------------------------------------------------------------------------------------------
     TOTAL INVESTMENTS                    $ 21,786          505            696             13        4,171          83       5,468
     OTHER POLICYHOLDER FUNDS             $ 16,873         --            1,150           --            848        --         1,998
----------------------------------------------------------------------------------------------------------------------------------
     TOTAL DERIVATIVE INSTRUMENTS -
          NOTIONAL VALUE                               $    505       $  1,846       $     13     $  5,019    $     83    $  7,466
==================================================================================================================================
     TOTAL DERIVATIVE INSTRUMENTS -
          FAIR VALUE                                   $    (22)      $     10       $   --       $    (22)   $      2    $    (32)
==================================================================================================================================
</TABLE>



<TABLE>
<CAPTION>
1998                                                                           AMOUNT HEDGED (NOTIONAL AMOUNTS)
                                          ----------------------------------------------------------------------------------
                                            Total                 Purchased                 Interest    Foreign      Total
                                          Carrying   Issued Caps    Caps &                 Rate Swaps   Currency    Notional
ASSETS HEDGED                               Value     & Floors      Floors    Futures (1)  & Forwards   Swaps (2)    Amount
----------------------------------------------------------------------------------------------------------------------------
<S>                                       <C>        <C>          <C>         <C>          <C>          <C>         <C>
Asset backed securities
   (excluding anticipatory)               $  5,835    $     44     $    258    $      3     $  1,084    $   --      $  1,389
Anticipatory (3)                              --          --           --          --            712        --           712
Other bonds and notes                        9,738         461          597          18        1,599          93       2,768
Short-term investments                       2,119        --           --          --           --          --          --
----------------------------------------------------------------------------------------------------------------------------
     TOTAL FIXED MATURITIES                 17,692         505          855          21        3,395          93       4,869
Equity securities, policy loans and
  other investments                          7,190        --           --          --           --          --          --
----------------------------------------------------------------------------------------------------------------------------
     TOTAL INVESTMENTS                    $ 24,882         505          855          21        3,395          93       4,869
     OTHER POLICYHOLDER FUNDS             $ 19,767        --          1,150        --          1,592        --         2,742
----------------------------------------------------------------------------------------------------------------------------
     TOTAL DERIVATIVE INSTRUMENTS -
          NOTIONAL VALUE                              $    505     $  2,005    $     21     $  4,987    $     93    $  7,611
============================================================================================================================
     TOTAL DERIVATIVE INSTRUMENTS -
          FAIR VALUE                                  $     (6)    $     19    $   --       $     55    $     (7)   $     61
============================================================================================================================
</TABLE>

(1)      As of December 31, 1999 and 1998, approximately 100% and 5%,
         respectively, of the notional futures contracts expire within one year.

(2)      As of December 31, 1999 and 1998, approximately 27% and 11%,
         respectively, of foreign currency swaps expire within one year.

(3)      Deferred gains and losses on anticipatory transactions are included in
         the carrying value of fixed maturities in the Consolidated Balance
         Sheets. At the time of the ultimate purchase, they are reflected as a
         basis adjustment to the purchased asset. As of December 31, 1999, the
         Company had $3.4 of deferred losses for interest rate swaps. Hartford
         Life expects to basis adjust the entire loss in 2000. As of December
         31, 1998, the Company had $0.6 of net deferred gains for interest rate
         swaps, which were basis adjusted in 1999.


                                      F-15
<PAGE>   52
The following is a reconciliation of notional amounts by derivative type and
strategy as of December 31, 1999 and 1998:


<TABLE>
<CAPTION>
                           December 31, 1998                        Maturities/        December 31, 1999
                            Notional Amount       Additions       Terminations (1)      Notional Amount
--------------------------------------------------------------------------------------------------------
<S>                        <C>                    <C>             <C>                  <C>
BY DERIVATIVE TYPE
Caps                            $1,927              $ --              $  148                $1,779
Floors                             583                --                 178                   405
Swaps/Forwards                   5,080               2,131             2,109                 5,102
Futures                             21               1,086             1,094                    13
Options                           --                   202                35                   167
--------------------------------------------------------------------------------------------------
   TOTAL                        $7,611              $3,419            $3,564                $7,466
==================================================================================================

BY STRATEGY
Liability                       $2,742              $  133            $  877                $1,998
Anticipatory                       712               1,118             1,585                   245
Asset                            2,914               1,691               512                 4,093
Portfolio                        1,243                 477               590                 1,130
--------------------------------------------------------------------------------------------------
   TOTAL                        $7,611              $3,419            $3,564                $7,466
==================================================================================================
</TABLE>

(1)      During 1999, the Company had no significant gains or losses on
         terminations of hedge positions using derivative financial instruments.


5.  FAIR VALUE OF FINANCIAL INSTRUMENTS

SFAS No. 107, "Disclosure about Fair Value of Financial Instruments", requires
disclosure of fair value information of financial instruments. For certain
financial instruments where quoted market prices are not available, other
independent valuation techniques and assumptions are used. Because considerable
judgment is used, these estimates are not necessarily indicative of amounts that
could be realized in a current market exchange. SFAS No. 107 excludes certain
financial instruments from disclosure, including insurance contracts. Hartford
Life uses the following methods and assumptions in estimating the fair value of
each class of financial instrument.

Fair value for fixed maturities and marketable equity securities approximates
those quotations published by applicable stock exchanges or received from other
reliable sources.

For policy loans, carrying amounts approximate fair value.

Other invested assets primarily consist of partnership investments, which are
accounted for by the equity method, and mortgage loans, whereby the carrying
value approximates fair value.

Other policyholder funds fair value information is determined by estimating
future cash flows, discounted at the current market rate.

Fair value for long-term debt and TruPS (represents company obligated
mandatorily redeemable preferred securities of subsidiary trust holding solely
parent junior subordinated debentures) is based on external valuation using
discounted future cash flows at current market interest rates.

The fair value of derivative financial instruments, including swaps, caps,
floors, futures, options and forward commitments, is determined using a pricing
model which is similar to external valuation models.


                                      F-16
<PAGE>   53
The carrying amount and fair values of Hartford Life's financial instruments as
of December 31, 1999 and 1998 were as follows:

<TABLE>
<CAPTION>
                                                1999                               1998
                                    -----------------------------     ------------------------------
                                    Carrying Amount    Fair Value     Carrying Amount     Fair Value
----------------------------------------------------------------------------------------------------
<S>                                 <C>                <C>            <C>                 <C>
ASSETS
--------------------------------------------------------------------------------------------------
  Fixed maturities                      $17,035          $17,035          $17,692          $17,692
  Equity securities                         153              153              140              140
  Policy loans                            4,222            4,222            6,687            6,687
  Other investments                         376              387              363              413
--------------------------------------------------------------------------------------------------
LIABILITIES
  Other policyholder funds (1)          $11,991          $11,416          $11,723          $11,740
  Long-term debt                            650              633              650              710
  TruPS                                     250              203              250              254
==================================================================================================
</TABLE>

(1)      Excludes corporate owned life insurance and universal life insurance
         contracts.


6.  SEPARATE ACCOUNTS

Hartford Life maintained separate account assets and liabilities totaling $110.7
billion and $90.6 billion as of December 31, 1999 and 1998, respectively, which
are reported at fair value. Separate account assets, which are segregated from
other investments, reflect two categories of risk assumption: non-guaranteed
separate accounts totaling $101.8 billion and $80.6 billion as of December 31,
1999 and 1998, respectively, wherein the policyholder assumes substantially all
the investment risk, and guaranteed separate accounts totaling $8.9 and $10.0
billion as of December 31, 1999 and 1998, respectively, wherein Hartford Life
contractually guarantees either a minimum return or account value to the
policyholder. Included in non-guaranteed separate account assets were policy
loans totaling $860 and $1.8 billion as of December 31, 1999 and 1998,
respectively. Net investment income (including net realized capital gains and
losses) and interest credited to policyholders on separate account assets are
not reflected in the Consolidated Statements of Income.

Separate account management fees and other revenues were $1.1 billion, $908 and
$699 in 1999, 1998 and 1997, respectively. The guaranteed separate accounts
include fixed market value adjusted (MVA) individual annuity and modified
guaranteed life insurance. The average credited interest rate on these contracts
was 6.5% and 6.6% as of December 31, 1999 and 1998, respectively. The assets
that support these liabilities were comprised of $8.9 billion and $9.8 billion
in fixed maturities as of December 31, 1999 and 1998, respectively, and $0.2
billion of other invested assets as of December 31, 1998. The portfolios are
segregated from other investments and are managed to minimize liquidity and
interest rate risk. In order to minimize the risk of disintermediation
associated with early withdrawals, fixed MVA annuity and modified guaranteed
life insurance contracts carry a graded surrender charge as well as a market
value adjustment. Additional investment risk is hedged using a variety of
derivatives which totaled $(96) and $41 in carrying value and $2.1 billion and
$3.6 billion in notional amounts as of December 31, 1999 and 1998, respectively.


7. DEBT

<TABLE>
<CAPTION>
                                                      1999                             1998
                                           ---------------------------     ----------------------------
                                                      Weighted Average                 Weighted Average
                                           Amount    Interest Rate (1)     Amount     Interest Rate (1)
-------------------------------------------------------------------------------------------------------
<S>                                        <C>       <C>                   <C>        <C>
LONG-TERM DEBT
   6.90% notes, due June 2004               $200            7.0%            $200            7.0%
   7.10% notes, due June 2007                200            7.2%             200            7.2%
   7.65% debentures, due June 2027           250            7.8%             250            7.8%
-----------------------------------------------------------------------------------------------
         TOTAL LONG-TERM DEBT               $650            7.4%            $650            7.4%
===============================================================================================
</TABLE>

(1)      Represents the weighted average effective interest rate at the end of
         the period.

(a)      SHORT-TERM DEBT

As of December 31, 1999, Hartford Life maintained a $250 five year revolving
credit facility comprised of four participatory banks. This facility, which
expires in 2003, is available for general corporate purposes and to provide
additional support for the Company's commercial paper program. As of December
31, 1999, there were no outstanding borrowings under the facility or commercial
paper program.


                                      F-17
<PAGE>   54
(b)      LONG-TERM DEBT

Hartford Life's long-term debt securities are unsecured obligations of Hartford
Life and rank on a parity with all other unsecured and unsubordinated
indebtedness. In February 1997, the Company filed a shelf registration statement
for the issuance and sale of up to $1.0 billion in the aggregate of senior debt
securities, subordinated debt securities and preferred stock. In June 1997, the
Company issued an aggregate principal amount of $650 of unsecured redeemable
long-term debt in the form of notes and debentures, maturing between 2004 and
2027. Interest on each of the notes and debentures is payable semi-annually on
June 15 and December 15 of each year, which commenced December 15, 1997.

In June 1998, Hartford Life filed an omnibus registration statement with the
Securities and Exchange Commission for the issuance of up to $1.0 billion of
debt and equity securities, including up to $350 of previously registered but
unsold securities, described above. The Company issued $250 of Company Obligated
Mandatorily Redeemable Preferred Securities of Subsidiary Trust Holding Solely
Parent Junior Subordinated Debentures on June 29, 1998, discussed below. As of
December 31, 1999, Hartford Life had $750 remaining on this shelf registration.

Interest expense related to short- and long-term debt totaled $49 in both 1999
and 1998 and $58 in 1997.

8.       COMPANY OBLIGATED MANDATORILY REDEEMABLE PREFERRED SECURITIES OF
         SUBSIDIARY TRUST HOLDING SOLELY PARENT JUNIOR SUBORDINATED DEBENTURES

On June 29, 1998, Hartford Life Capital I, a special purpose Delaware trust
formed by Hartford Life, issued 10,000,000, 7.2% Trust Preferred Securities,
Series A (Series A Preferred Securities). The proceeds from the sale of the
Series A Preferred Securities were used to acquire $250 of 7.2% Series A Junior
Subordinated Deferrable Interest Debentures (Junior Subordinated Debentures)
issued by Hartford Life. Hartford Life used the proceeds from the offering for
the retirement of its outstanding commercial paper, strategic acquisitions and
other general corporate purposes.

The Series A Preferred Securities represent undivided beneficial interests in
Hartford Life Capital I's assets, which consist solely of the Junior
Subordinated Debentures. Hartford Life owns all the beneficial interests
represented by Series A Common Securities of Hartford Life Capital I. Holders of
Series A Preferred Securities are entitled to receive cumulative cash
distributions accruing from June 29, 1998, the date of issuance, and payable
quarterly in arrears commencing July 15, 1998 at the annual rate of 7.2% of the
stated liquidation amount of $25.00 per Series A Preferred Security. The Series
A Preferred Securities are subject to mandatory redemption upon repayment of the
Junior Subordinate Debentures at maturity or upon earlier redemption. Hartford
Life has the right to redeem the Junior Subordinated Debentures on or after June
30, 2003 or earlier upon the occurrence of certain events. Holders of Series A
Preferred Securities generally have no voting rights.

Hartford Life has the right to redeem the Junior Subordinated Debentures (i) in
whole or in part on or after June 30, 2003 or (ii) at any time, in whole but not
in part, in certain circumstances upon the occurrence of certain specified
events, in either case at a redemption price equal to accrued and unpaid
interest on the Junior Subordinated Debentures so redeemed to the date fixed for
redemption plus the principal amount thereof. In addition, prior to June 30,
2003, Hartford Life shall have the right to redeem the Junior Subordinated
Debentures at any time, in whole or in part, at a redemption price equal to the
accrued and unpaid interest on the Junior Subordinated Debentures so redeemed to
the date fixed for redemption, plus the greater of (a) the principal amount
thereof or (b) an amount equal to the present value on the redemption date of
the interest payments that would have been paid through June 30, 2003, after
discounting that amount on a quarterly basis from the originally scheduled date
for payment, and the present value on the redemption date of principal, after
discounting that amount on a quarterly basis from June 30, 2003, at a discount
rate tied to the interest rate on Treasury securities maturing on June 30, 2003.

The Junior Subordinated Debentures bear interest at the annual rate of 7.2% of
the principal amount, payable quarterly in arrears, which commenced June 29,
1998, and mature on June 30, 2038. The Junior Subordinated Debentures are
unsecured and rank junior and subordinate in right of payment to all present and
future senior debt of Hartford Life and are effectively subordinated to all
existing and future liabilities of its subsidiaries.

Hartford Life has the right at any time, and from time to time, to defer
payments of interest on the Junior Subordinated Debentures for a period not
exceeding 20 consecutive quarters up to the debentures' maturity date. During
any such period, interest will continue to accrue and Hartford Life may not
declare or pay any cash dividends or distributions on, or purchase, Hartford
Life's capital stock, nor make any principal, interest or premium payments on or
repurchase any debt securities that rank pari passu with or junior to the Junior
Subordinated Debentures. The Company will have the right at any time to dissolve
the Trust and cause the Junior Subordinated Debentures to be distributed to the
holders of the Series A Preferred Securities and the Series A Common Stock.
Hartford Life has


                                      F-18
<PAGE>   55
guaranteed, on a subordinated basis, all the Hartford Life Capital I obligations
under the Series A Preferred Securities, including payment of the redemption
price and any accumulated and unpaid distributions upon dissolution, winding up
or liquidation to the extent funds are available.

Interest expense with respect to the Series A Preferred Securities totaled
approximately $18 and $9 in 1999 and 1998, respectively.


9.   STOCKHOLDERS' EQUITY

(a)   PREFERRED STOCK

Hartford Life has 50,000,000 shares of preferred stock authorized, $0.01 par
value. No shares were issued or outstanding as of December 31, 1999 and 1998.

(b)   STATUTORY RESULTS

<TABLE>
<CAPTION>
                                             For the years ended December 31,
                                          --------------------------------------
                                           1999            1998            1997
--------------------------------------------------------------------------------
<S>                                       <C>             <C>             <C>
Statutory net income                      $  220          $  265          $  223
--------------------------------------------------------------------------------
Statutory capital and surplus             $2,214          $2,010          $1,672
================================================================================
</TABLE>

Statutory net income of $220 in 1999 was lower than 1998 due to losses realized
on certain securities. Excluding those losses, statutory net income in 1999 was
$290, 9% higher than 1998.

A significant percentage of the consolidated statutory surplus is permanently
reinvested or is subject to various state regulatory restrictions which limit
the payment of dividends without prior approval. The total amount of statutory
dividends which may be paid by the insurance subsidiaries of the Company in
2000, without prior regulatory approval, is estimated to be $221.

The domestic insurance subsidiaries of Hartford Life prepare their statutory
financial statements in accordance with accounting practices prescribed by the
applicable state of domicile. Prescribed statutory accounting practices include
publications of the National Association of Insurance Commissioners (NAIC), as
well as state laws, regulations and general administrative rules.

The NAIC adopted the Codification of Statutory Accounting Principles (SAP) in
March 1998. The proposed effective date for the statutory accounting guidance is
January 1, 2001. It is expected that each of Hartford Life's domiciliary states
will adopt the SAP and the Company will make the necessary changes required for
implementation. The Company has not yet determined the impact that the SAP will
have on the statutory financial statements of the insurance subsidiaries of
Hartford Life.


10.  EARNINGS PER SHARE

Basic earnings per share are computed based upon the weighted average number of
shares outstanding during the respective periods. Diluted earnings per share
include the dilutive effect of outstanding options, using the treasury stock
method, and also contingently issuable shares. Under the treasury stock method,
it is assumed that options are exercised and the proceeds are assumed to be used
to purchase common stock at the average market price for the period. The
difference between the number of shares assumed issued and number of shares
assumed purchased represents the dilutive shares. Contingently issuable shares
are included upon satisfaction of certain conditions related to contingency.

Earnings per share amounts, on a basic and diluted basis, have been calculated
based upon the weighted average common shares deemed to be outstanding during
the respective periods. For periods prior to the closing of the Company's IPO
(May 22, 1997), outstanding shares are based upon 114 million shares of Class B
Common Stock owned by The Hartford plus an assumed issuance of 11 million shares
of Class A Common Stock (the number of shares that, based upon the IPO price and
the underwriting discounts and expenses payable by the Company, would result in
net proceeds equal to the excess of the amount of the February and April 1997
dividends over the 1996 earnings and allocated advances from its parent, HA&I).

Pro forma effect has been given for the 1997 period presented for the conversion
of 1,000 shares of common stock, par value $0.01 per share, into 114 million
shares of Class B Common Stock, par value $0.01 per share, which occurred on
April 3, 1997.


                                      F-19
<PAGE>   56
<TABLE>
<CAPTION>
1999                                                                             Income           Shares     Per Share Amount
-----------------------------------------------------------------------------------------------------------------------------
<S>                                                                         <C>                   <C>        <C>
BASIC EARNINGS PER SHARE
  Amounts available to common shareholders                                  $         467          139.9     $        3.34
                                                                                                             ----------------
DILUTED EARNINGS PER SHARE
  Impact of options and contingently issuable shares                                    -            0.3
                                                                            ----------------------------
  Amounts available to common shareholders plus assumed conversions         $         467          140.2     $        3.33
=============================================================================================================================
</TABLE>


<TABLE>
<CAPTION>
1998                                                                             Income           Shares     Per Share Amount
-----------------------------------------------------------------------------------------------------------------------------
<S>                                                                         <C>                   <C>        <C>
BASIC EARNINGS PER SHARE
  Amounts available to common shareholders                                  $         386          140.0     $        2.76
                                                                                                             ----------------
DILUTED EARNINGS PER SHARE
  Impact of options and contingently issuable shares                                    -            0.2
                                                                            ----------------------------
  Amounts available to common shareholders plus assumed conversions         $         386          140.2     $        2.75
=============================================================================================================================
</TABLE>


<TABLE>
<CAPTION>
1997                                                                             Income           Shares     Per Share Amount
-----------------------------------------------------------------------------------------------------------------------------
<S>                                                                         <C>                   <C>        <C>
PRO FORMA BASIC EARNINGS PER SHARE
  Amounts available to common shareholders                                  $         306          134.0     $        2.28
                                                                                                             ----------------
PRO FORMA DILUTED EARNINGS PER SHARE
  Impact of options and contingently issuable shares                                    -            0.1
                                                                            ----------------------------
  Amounts available to common shareholders plus assumed conversions         $         306          134.1     $        2.28
=============================================================================================================================
</TABLE>

If earnings per share were calculated based upon 140 million weighted average
shares outstanding for the 1997 period presented (representing the weighted
average shares outstanding at the time of the IPO, May 22, 1997), earnings per
share would have been $2.18.


11.  STOCK COMPENSATION PLANS

In 1997, the Company adopted the 1997 Hartford Life, Inc. Incentive Stock Plan
(the "Plan"). Under the Plan, options granted may be either non-qualified
options or incentive stock options qualifying under Section 422A of the Internal
Revenue Code, stock appreciation rights, performance shares or restricted stock,
or any combination of the foregoing. The aggregate number of shares of Class A
Common Stock which may be awarded in any one year shall be subject to an annual
limit. The maximum number of shares of Class A Common Stock which may be granted
under the Plan in each year shall be 1.5% of the total issued and outstanding
shares of Hartford Life Class A and Class B Common Stock and treasury stock as
reported in the Annual Report on Form 10-K of the Company for the preceding year
plus unused portions of such limit from prior years.

In addition, no more than 5 million shares of Class A Common Stock shall be
cumulatively available for awards of incentive stock options under the Plan, and
no more than 20% of the total number of shares on a cumulative basis shall be
available for restricted stock and performance shares awards. Performance shares
awards of common stock granted under the Plan become payable upon the attainment
of specific performance goals achieved over a three year period.

All options granted have an exercise price equal to the market price of the
Company's stock on the date of grant and an option's maximum term is ten years.
Certain non-performance based options become exercisable upon the attainment of
specified market price appreciation of the Company's common shares or at seven
years after the date of grant, while the remaining non-performance based options
become exercisable over a three year period commencing with the date of grant.


                                      F-20
<PAGE>   57
During the second quarter of 1997, the Company established the Hartford Life,
Inc. Employee Stock Purchase Plan (ESPP). Under this plan, eligible employees of
Hartford Life may purchase Class A Common Stock of the Company at a 15% discount
from the lower of the market price at the beginning or end of the quarterly
offering period. The Company may sell up to 2,700,000 shares of stock to
eligible employees. The Company sold 120,694, 121,943 and 54,316 shares under
the ESPP in 1999, 1998 and 1997, respectively. The weighted average fair value
of the discount under the ESPP was $7.48 per share in 1999, $13.74 per share in
1998 and $9.63 per share in 1997.

The Company applies Accounting Principles Board Opinion No. 25 and related
interpretation in accounting for its stock based compensation plans.
Accordingly, in the measurement of compensation expense the Company utilizes the
excess of market price over exercise price, on the first date that both the
number of shares and award price are known. For the years ended December 31,
1999, 1998 and 1997, compensation expense related to the Company's two stock
based compensation plans was not material. Had compensation cost for the
Company's Incentive Stock Plan and ESPP been determined based on the fair value
at the grant dates for awards under those plans consistent with the method under
SFAS No. 123, the Company's net income and basic and diluted earnings per share
would have been reduced to the pro forma amounts indicated below:

<TABLE>
<CAPTION>
                                               1999          1998          1997
--------------------------------------------------------------------------------
<S>                                           <C>           <C>           <C>
Net income
   As reported                                $  467        $  386        $  306
   Pro forma (1)                                 456           379           304
--------------------------------------------------------------------------------
Basic earnings per share
   As reported                                $ 3.34        $ 2.76        $ 2.28
   Pro forma (1)                                3.26          2.71          2.27
--------------------------------------------------------------------------------
Diluted earnings per share
   As reported                                $ 3.33        $ 2.75        $ 2.28
   Pro forma (1)                                3.25          2.70          2.27
================================================================================
</TABLE>

(1)      The pro forma disclosures are not representative of the effects on net
         income and earnings per share in future years.

The fair value of each option grant is estimated on the date of the grant using
the Black-Scholes options-pricing model with the following weighted average
assumptions used for grants in 1999, 1998 and 1997: dividend yield of 1.0% for
1999, 1998 and 1997; expected price variability of 36% for 1999, 33% for 1998
and 29% for 1997; risk free interest rates of 5.3% for the 1999 grants, 4.9% for
the 1998 grants and 6.4% for the 1997 grants; and expected lives of five years
for 1999, 1998 and 1997.

A summary of the status of non-qualified options included in the Company's
incentive stock plan as of December 31, 1999, 1998 and 1997 and changes during
the year ended December 31, 1999 and through the period ended December 31, 1997
is presented below:

<TABLE>
<CAPTION>
                                                 1999                           1998                            1997
                                       --------------------------   -----------------------------    --------------------------
                                                     Weighted                       Weighted                       Weighted
                                                      Average                        Average                        Average
                                         Shares    Exercise Price     Shares       Exercise Price    Shares      Exercise Price
-----------------------------------------------------------------   -----------------------------    --------------------------
<S>                                    <C>         <C>              <C>            <C>               <C>         <C>
Outstanding at beginning of year        1,766,397    $   40.96          422,512      $   31.54           --         $     --
Granted                                   621,615        51.83        1,376,375          43.74         450,377          31.52
Exercised                                 (45,063)       35.88          (15,483)         31.10           --              --
Cancelled/Expired                         (69,447)       42.40          (17,007)         40.24         (27,865)         31.31
                                       ----------                    ----------                       --------
Outstanding at end of year              2,273,502    $   43.99        1,766,397      $   40.96         422,512      $   31.54
-----------------------------------------------------------------------------------------------------------------------------
Exercisable at end of year                903,605    $   39.69          504,562      $   37.72         136,532      $   31.14
Weighted average fair value of
   options granted                     $    19.41                    $    15.13                       $  10.93
=============================================================================================================================
</TABLE>


The following table summarizes information about stock options outstanding and
exercisable as of December 31, 1999:

<TABLE>
<CAPTION>
                                         Options Outstanding                                   Options Exercisable
                    ------------------------------------------------------------    ---------------------------------------
                    Number Outstanding     Weighted Average                         Number Outstanding
    Range of        as of December 31,         Remaining        Weighted Average    as of December 31,     Weighted Average
Exercise Prices            1999            Contractual Life      Exercise Price            1999             Exercise Price
---------------     ------------------     ----------------     ----------------    -------------------    ----------------
<S>                 <C>                    <C>                  <C>                 <C>                    <C>
$30.06 - $45.00          1,593,987                8.3              $   40.02             841,554              $   38.73
$45.75 - $59.38            679,515                9.0                  53.31              62,051                  52.67
-----------------------------------------------------------------------------------------------------------------------
$30.06 - $59.38          2,273,502                8.5              $   43.99             903,605              $   39.69
-----------------------------------------------------------------------------------------------------------------------
</TABLE>


                                      F-21
<PAGE>   58
12.  POSTRETIREMENT BENEFIT AND SAVINGS PLANS

(a) PENSION PLANS

Hartford Life's employees are included in The Hartford's non-contributory
defined benefit pension plans. These plans provide pension benefits that are
based on years of service and the employee's compensation during the last ten
years of employment. The Company's funding policy is to contribute annually an
amount between the minimum funding requirements set forth in the Employee
Retirement Income Security Act of 1974, as amended, and the maximum amount that
can be deducted for U.S. federal income tax purposes. Generally, pension costs
are funded through the purchase of the Company's group pension contracts. The
cost to the Company was approximately $10 in 1999, $9 in 1998 and $7 in 1997.

The Company also provides, through The Hartford, certain health care and life
insurance benefits for eligible retired employees. A substantial portion of the
Company's employees may become eligible for these benefits upon retirement. The
Company's contribution for health care benefits will depend on the retiree's
date of retirement and years of service. In addition, the plan has a defined
dollar cap which limits average Company contributions. The Company has prefunded
a portion of the health care and life insurance obligations through trust funds
where such prefunding can be accomplished on a tax effective basis.
Postretirement health care and life insurance benefits expense, allocated by The
Hartford, was not material to the results of operations for 1999, 1998 and 1997.

The assumed rate in the per capita cost of health care (the health care trend
rate) was 7.1% for 1999, decreasing ratably to 5.0% in the year 2003. Increasing
or decreasing the health care trend rates by one percent per year would have an
immaterial impact on the accumulated postretirement benefit obligation and the
annual expense. To the extent that the actual experience differs from the
inherent assumptions, the effect will be amortized over the average future
service of covered employees.

(b) INVESTMENT AND SAVINGS PLAN

Substantially all U.S. employees of the Company are eligible to participate in
The Hartford's Investment and Savings Plan. Under this plan, designated
contributions, which may be invested in Class A Common Stock of Hartford Life or
certain other investments, are matched, up to 3% of compensation, by the
Company. In addition, the Company allocates 0.5% of base salary to the plan for
each eligible employee. Matching Company contributions are used to acquire
Hartford Life Class A Common Stock. The cost to Hartford Life for the
above-mentioned plan was approximately $6 in both 1999 and 1998, and $5 in 1997.


13.  REINSURANCE

Hartford Life cedes insurance to other insurers in order to limit its maximum
losses. Such transfer does not relieve Hartford Life of its primary liability.
Failure of reinsurers to honor their obligations could result in losses to
Hartford Life. Hartford Life reduces this risk by evaluating the financial
condition of reinsurers and monitoring for possible concentrations of credit
risk. Hartford Life has no significant reinsurance related concentrations of
credit risk.

The Company records a receivable for the portion of reinsured benefits paid and
insurance liabilities. Reinsurance recoveries on ceded reinsurance contracts
were $168, $119 and $205 for the years ended December 31, 1999, 1998 and 1997,
respectively. Hartford Life also assumes insurance from other insurers.

The effect of reinsurance on premiums and other considerations is summarized as
follows:

<TABLE>
<CAPTION>
                                                For the years ended December 31,
                                              -----------------------------------
                                                1999          1998          1997
---------------------------------------------------------------------------------
<S>                                           <C>           <C>           <C>
Direct premiums and other considerations      $ 4,068       $ 3,946       $ 3,352
Reinsurance assumed                               154            98           165
Reinsurance ceded                                (243)         (211)         (354)
---------------------------------------------------------------------------------
   PREMIUMS AND OTHER CONSIDERATIONS          $ 3,979       $ 3,833       $ 3,163
=================================================================================
</TABLE>

In 1998, the Company recaptured an in force block of Corporate Owned Life
Insurance (COLI) business previously ceded to MBL Assurance Co. of New Jersey
(MBL Life). The transaction was consummated through an assignment of a
reinsurance arrangement between Hartford Life and MBL Life to a Hartford Life
subsidiary. Hartford Life originally assumed the life insurance block in 1992
from Mutual Benefit Life, which was placed in court-supervised rehabilitation in
1991, and reinsured a portion of those policies back to MBL Life. This recapture
was effective January 1, 1998 and resulted in a decrease in ceded premiums and
other considerations of $163 in 1998. Additionally, this transaction resulted in
a decrease in reinsurance recoverables of $4.8 billion, which was exchanged for
the fair value of assets comprised of $4.3 billion in policy loans and $443 in
other assets.


                                      F-22
<PAGE>   59
14.  INCOME TAX

Hartford Life and The Hartford have entered into a tax sharing agreement under
which each member in the consolidated U.S. federal income tax return will make
payments between them such that, with respect to any period, the amount of taxes
to be paid by the Company, subject to certain adjustments, generally will be
determined as though the Company were filing separate federal, state and local
income tax returns.

As long as The Hartford continues to own at least 80% of the combined voting
power and 80% of the value of the outstanding capital stock of the Company, the
Company will be included for federal income tax purposes in the affiliated group
of which The Hartford is the common parent. It is the intention of The Hartford
and its non-life subsidiaries to file a single consolidated federal income tax
return. The life insurance companies filed a separate consolidated federal
income tax return for 1998 and 1997 and intend to file a separate consolidated
federal income tax return for 1999. The Company's effective tax rate was 32%,
34% and 36% in 1999, 1998 and 1997, respectively.

Income tax expense (benefit) is as follows:

<TABLE>
<CAPTION>
                                              For the years ended December 31,
                                           -------------------------------------
                                            1999            1998            1997
--------------------------------------------------------------------------------
<S>                                        <C>             <C>             <C>
Current                                    $ (41)          $ 299           $ 169
Deferred                                     260            (100)              5
--------------------------------------------------------------------------------
   INCOME TAX EXPENSE                      $ 219           $ 199           $ 174
================================================================================
</TABLE>


A reconciliation of the tax provision at the U.S. federal statutory rate to the
provision (benefit) for income taxes is as follows:

<TABLE>
<CAPTION>
                                                     For the years ended December 31,
                                                     --------------------------------
                                                       1999        1998        1997
-------------------------------------------------------------------------------------
<S>                                                   <C>         <C>         <C>
Tax provision at the U.S. federal statutory rate      $ 240       $ 205       $ 168
Tax-exempt income                                       (17)         (9)       --
Other                                                    (4)          3           6
-----------------------------------------------------------------------------------
   TOTAL                                              $ 219       $ 199       $ 174
===================================================================================
</TABLE>

Deferred tax assets (liabilities) include the following as of December 31:

<TABLE>
<CAPTION>
                                                                         1999        1998
-----------------------------------------------------------------------------------------
<S>                                                                     <C>         <C>
Tax basis deferred policy acquisition costs                             $ 754       $ 767
Financial statement deferred policy acquisition costs and reserves         10          95
Employee benefits                                                          25          21
Net unrealized capital (gains) losses on securities                       184        (142)
Investments and other                                                    (451)       (285)
-----------------------------------------------------------------------------------------
    TOTAL                                                               $ 522       $ 456
=========================================================================================
</TABLE>

Hartford Life had a current tax receivable of $40 as of December 31, 1999 and a
current tax payable of $71 as of December 31, 1998.

Prior to the Tax Reform Act of 1984, the Life Insurance Company Income Tax Act
of 1959 permitted the deferral from taxation of a portion of statutory income
under certain circumstances. In these situations, the deferred income was
accumulated in a "Policyholders' Surplus Account" and, based on current tax law,
will be taxable in the future only under conditions which management considers
to be remote; therefore, no federal income taxes have been provided on the
balance in this account, which for tax return purposes was $104 as of December
31, 1999.


                                      F-23
<PAGE>   60
15.  RELATED PARTY TRANSACTIONS

Transactions of the Company with HA&I and its affiliates relate principally to
tax settlements, reinsurance, insurance coverage, rental and service fees,
payment of dividends and capital contributions. In addition, certain affiliated
insurance companies purchased group annuity contracts from the Company to fund
pension costs and claim annuities to settle casualty claims. Substantially all
general insurance expenses related to the Company, including rent and employee
benefit plan expenses, are initially paid by The Hartford. Direct expenses are
allocated to the Company using specific identification, and indirect expenses
are allocated using other applicable methods. Indirect expenses include those
for corporate areas which, depending on type, are allocated based on either a
percentage of direct expenses or on utilization. Indirect expenses allocated to
the Company by The Hartford were $72 in both 1999 and 1998, and $59 in 1997.
Included in other liabilities are $15 and $54 due to The Hartford as of December
31, 1999 and 1998, respectively.


16.  COMMITMENTS AND CONTINGENT LIABILITIES

(a) LITIGATION

Hartford Life is involved in pending and threatened litigation in the normal
course of its business in which claims for alleged economic and punitive damages
have been asserted. Some of these cases have been filed as purported class
actions and some cases have been filed in certain jurisdictions that permit
punitive damage awards disproportionate to the actual damages incurred. Although
there can be no assurances, at the present time the Company does not anticipate
that the ultimate liability arising from such pending or threatened litigation,
after consideration of provisions made for estimated losses and costs of
defense, will have a material adverse effect on the financial condition or
operating results of the Company.

(b) GUARANTY FUNDS

Under insurance guaranty fund laws in each state, the District of Columbia and
Puerto Rico, insurers licensed to do business can be assessed by state insurance
guaranty associations for certain obligations of insolvent insurance companies
to policyholders and claimants. Recent regulatory actions against certain large
life insurers encountering financial difficulty have prompted various state
insurance guaranty associations to begin assessing life insurance companies for
the deemed losses. Most of these laws do provide, however, that an assessment
may be excused or deferred if it would threaten an insurer's solvency and
further provide annual limits on such assessments. Part of the assessments paid
by the Company's insurance subsidiaries pursuant to these laws may be used as
credits for a portion of the Company's insurance subsidiaries' premium taxes.
The Company paid guaranty fund assessments of approximately $2, $9 and $15 in
1999, 1998 and 1997, respectively, of which $1, $4 and $5, respectively, were
estimated to be creditable against premium taxes.

(c) LEASES

The rent paid to Hartford Fire for space occupied by the Company was $15, $14
and $13 in 1999, 1998 and 1997, respectively. Future minimum rental commitments
are as follows:

<TABLE>
<S>                                                                  <C>
2000                                                                 $        25
2001                                                                          24
2002                                                                          24
2003                                                                          22
2004                                                                          22
Thereafter                                                                   110
--------------------------------------------------------------------------------
    TOTAL                                                            $       227
================================================================================
</TABLE>

Hartford Life's principal executive offices are located in Simsbury,
Connecticut. Rental expense is recognized on a level basis over the term of the
primary sublease for the facility located in Simsbury, Connecticut, which
expires on December 31, 2009, and amounted to approximately $16 in each of the
years ended December 31, 1999, 1998 and 1997.

(d) TAX MATTERS

Hartford Life's federal income tax returns are routinely audited by the Internal
Revenue Service. The Company's 1996 - 1997 federal income tax returns are
currently under audit by the Internal Revenue Service. Management believes that
sufficient provision has been made in the financial statements for issues that
may result from tax examinations and other tax related matters for all open tax
years.


                                      F-24
<PAGE>   61
17.      SEGMENT INFORMATION

Hartford Life is organized into four reportable operating segments: Investment
Products, Individual Life, Employee Benefits and Corporate Owned Life Insurance
(COLI). Investment Products offers individual fixed and variable annuities,
mutual funds, retirement plan services and other investment products, structured
settlement contracts and other special purpose annuity contracts. Individual
Life sells a variety of life insurance products, including variable life,
universal life, interest sensitive whole life and term life insurance. Employee
Benefits sells group insurance products, including group life and group
disability insurance as well as other products, including stop loss and
supplementary medical coverage to employers and employer sponsored plans,
accidental death and dismemberment, travel accident, long-term care insurance
and other special risk coverages to employers and associations. COLI primarily
offers variable products used by employers to fund non-qualified benefits or
other postemployment benefit obligations as well as leveraged COLI. The Company
includes in "Other" corporate items not directly allocable to any of its
reportable operating segments, principally interest expense, as well as its
international operations.

The accounting policies of the reportable operating segments are the same as
those described in the summary of significant accounting policies in Note 2.
Hartford Life evaluates performance of its segments based on revenues, net
income and the segment's return on allocated capital. The Company charges direct
operating expenses to the appropriate segment and allocates the majority of
indirect expenses to the segments based on an intercompany expense arrangement.
Intersegment revenues are not significant and primarily occur between corporate
and the operating segments. These amounts include interest income on allocated
surplus and the allocation of net realized capital gains and losses through net
investment income utilizing the duration of the segment's investment portfolios.
The Company's revenues are primarily derived from customers within the United
States. The Company's long-lived assets primarily consist of deferred policy
acquisition costs and deferred tax assets from within the United States. The
following tables present summarized financial information concerning the
Company's segments.

<TABLE>
<CAPTION>
                                     Investment    Individual   Employee
1999                                  Products       Life       Benefits    COLI          Other        Total
-----------------------------------------------------------------------------------------------------------------
<S>                                  <C>           <C>          <C>        <C>           <C>         <C>
Total revenues                       $  2,041       $  584       $2,024    $   831       $   56      $  5,536
Net investment income                     708          172          195        431           56         1,562
Amortization of deferred
   policy acquisition costs               430          129            9          -            -           568
Income tax expense (benefit)              173           38           23         17          (32)          219
Net income (loss)                         330           71           79         30          (43)          467
Assets                                107,256        6,629        3,640     20,158        1,350       139,033
-----------------------------------------------------------------------------------------------------------------
</TABLE>


<TABLE>
<CAPTION>

                                    Investment     Individual     Employee
1998                                 Products         Life        Benefits       COLI        Other      Total
-------------------------------------------------------------------------------------------------------------------
<S>                                 <C>            <C>            <C>          <C>          <C>        <C>
Total revenues                       $ 1,784        $  567        $1,809       $ 1,567      $   61     $  5,788
Net investment income                    739           189           180           793          54        1,955
Amortization of deferred
   policy acquisition costs              326           108             7             -           -          441
Income tax expense (benefit)             145            36            27            12         (21)         199
Net income (loss)                        266            65            71            24         (40)         386
Assets                                87,706         5,404         3,068        22,631       3,213      122,022
-------------------------------------------------------------------------------------------------------------------
</TABLE>


<TABLE>
<CAPTION>
                                    Investment      Individual      Employee
1997                                 Products          Life         Benefits       COLI          Other        Total
------------------------------------------------------------------------------------------------------------------------
<S>                                 <C>             <C>             <C>           <C>           <C>         <C>
Total revenues                       $ 1,510         $  510         $1,700        $   980       $   (1)     $  4,699
Net investment income                    739            171            162            429           35         1,536
Amortization of deferred
   policy acquisition costs              250             87              6              -            2           345
Income tax expense (benefit)             112             31             32             15          (16)          174
Net income (loss)                        202             56             58             27          (37)          306
Assets                                72,799          5,151          2,355         17,800        2,875       100,980
------------------------------------------------------------------------------------------------------------------------
</TABLE>


                                      F-25
<PAGE>   62
18.  QUARTERLY RESULTS FOR 1999 AND 1998  (UNAUDITED)

<TABLE>
<CAPTION>
                                                                           Three Months Ended
                                          -------------------------------------------------------------------------------------
                                              March 31,              June 30,           September 30,         December 31,
                                          -------------------------------------------------------------------------------------
                                           1999       1998       1999       1998       1999       1998       1999       1998
-------------------------------------------------------------------------------------------------------------------------------
<S>                                       <C>        <C>        <C>        <C>        <C>        <C>        <C>        <C>
Revenues                                  $1,335     $1,404     $1,357     $1,155     $1,420     $1,287     $1,424     $1,942
Benefits, claims and expenses              1,178      1,275      1,187      1,013      1,253      1,135      1,232      1,780
Net income                                   106         84        114         94        119        100        128        108
-------------------------------------------------------------------------------------------------------------------------------

Basic earnings per share                  $ 0.76     $ 0.60     $ 0.81     $ 0.67     $ 0.85     $ 0.71     $ 0.91     $ 0.77
Diluted earnings per share                $ 0.76     $ 0.60     $ 0.81     $ 0.67     $ 0.85     $ 0.71     $ 0.91     $ 0.77
-------------------------------------------------------------------------------------------------------------------------------

Weighted average common shares
   outstanding                             139.9      140.0      139.9      140.0      140.0      140.0       140.0      139.9
Weighted average common shares
   outstanding and dilutive potential
   common shares                           140.3      140.1      140.2      140.3      140.3      140.2       140.1      140.2
-------------------------------------------------------------------------------------------------------------------------------
</TABLE>

                                      F-26
<PAGE>   63
                      HARTFORD LIFE, INC. AND SUBSIDIARIES

                                   SCHEDULE I

          SUMMARY OF INVESTMENTS - OTHER THAN INVESTMENTS IN AFFILIATES

<TABLE>
<CAPTION>
(In millions)                                                                     As of December 31, 1999
                                                                        ----------------------------------------------
                                                                                                     Amount at which
                                                                                                     shown on Balance
                          Type of Investment                               Cost        Fair Value          Sheet
----------------------------------------------------------------------------------------------------------------------
<S>                                                                     <C>            <C>           <C>
FIXED MATURITIES
  Bonds and Notes
     U.S. Government and Government agencies and authorities
       (guaranteed and sponsored)                                        $   228         $   229          $   229
     U.S. Government and Government agencies and authorities
       (guaranteed and sponsored) - asset backed                           1,333           1,298            1,298
     States, municipalities and political subdivisions                     1,346           1,273            1,273
     Foreign governments                                                     347             339              339
     Public utilities                                                        991             957              957
     All other corporate, including international                          6,539           6,283            6,283
     All other corporate - asset backed                                    4,914           4,767            4,767
     Short-term investments                                                1,346           1,346            1,346
  Certificates of deposit                                                    510             497              497
  Redeemable preferred stock                                                  48              46               46
----------------------------------------------------------------------------------------------------------------------
       TOTAL FIXED MATURITIES                                             17,602          17,035           17,035
======================================================================================================================
EQUITY SECURITIES
  Common Stocks
     Industrial and miscellaneous                                            130             153              153
----------------------------------------------------------------------------------------------------------------------
       TOTAL EQUITY SECURITIES                                               130             153              153
======================================================================================================================
       TOTAL FIXED MATURITIES AND EQUITY SECURITIES                       17,732          17,188           17,188
======================================================================================================================
POLICY LOANS                                                               4,222           4,222            4,222
----------------------------------------------------------------------------------------------------------------------
OTHER INVESTMENTS
  Mortgage loans on real estate                                              200             200              200
  Other invested assets                                                      154             187              176
----------------------------------------------------------------------------------------------------------------------
       TOTAL OTHER INVESTMENTS                                               354             387              376
======================================================================================================================
       TOTAL INVESTMENTS                                                 $22,308         $21,797          $21,786
======================================================================================================================
</TABLE>

                                      S-1
<PAGE>   64
                      HARTFORD LIFE, INC. AND SUBSIDIARIES

                                   SCHEDULE II

             CONDENSED FINANCIAL INFORMATION OF HARTFORD LIFE, INC.
                                  (REGISTRANT)

<TABLE>
<CAPTION>
(In millions)                                                                                  As of December 31,
                                                                                           -------------------------
CONDENSED BALANCE SHEETS                                                                      1999        1998
--------------------------------------------------------------------------------------------------------------------
<S>                                                                                        <C>           <C>
ASSETS
   Fixed maturities, available for sale, at fair value
     (amortized cost of $1 and $2)                                                           $    1      $    2
   Investment in subsidiaries                                                                 3,209       3,393
   Other assets                                                                                  17           4
--------------------------------------------------------------------------------------------------------------------
     TOTAL ASSETS                                                                             3,227       3,399
====================================================================================================================

LIABILITIES AND STOCKHOLDERS' EQUITY
  Long-term debt                                                                                650         650
  Company obligated mandatorily redeemable preferred
      securities of subsidiary trust holding solely parent
      junior subordinated debentures                                                            250         250
  Other liabilities                                                                              21           6
--------------------------------------------------------------------------------------------------------------------
     TOTAL LIABILITIES                                                                          921         906
     TOTAL STOCKHOLDERS' EQUITY                                                               2,306       2,493
====================================================================================================================
     TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                                              $3,227      $3,399
====================================================================================================================
</TABLE>


<TABLE>
<CAPTION>
(In millions)
                                                                        For the years ended December 31,
                                                                        -------------------------------------
CONDENSED STATEMENTS OF INCOME                                           1999         1998        1997
-------------------------------------------------------------------------------------------------------------
<S>                                                                     <C>           <C>         <C>
  Earnings of subsidiaries                                               $753         $643        $538
  Interest expense                                                         67           58          58
-------------------------------------------------------------------------------------------------------------
     INCOME BEFORE INCOME TAX EXPENSE                                     686          585         480
  Income tax expense                                                      219          199         174
-------------------------------------------------------------------------------------------------------------
     NET INCOME                                                          $467         $386        $306
=============================================================================================================
</TABLE>

The financial information of Hartford Life, Inc. (parent company of Hartford
Life) should be read in conjunction with the Consolidated Financial Statements
and Notes to Consolidated Financial Statements.

                                      S-2
<PAGE>   65
                      HARTFORD LIFE, INC. AND SUBSIDIARIES

                                   SCHEDULE II

       CONDENSED FINANCIAL INFORMATION OF HARTFORD LIFE, INC. (CONTINUED)
                                  (REGISTRANT)

<TABLE>
<CAPTION>
(In millions)

CONDENSED STATEMENTS OF CASH FLOWS                                       For the years ended December 31,
                                                                      ---------------------------------------
                                                                        1999            1998           1997
-------------------------------------------------------------------------------------------------------------
<S>                                                                   <C>              <C>            <C>
OPERATING ACTIVITIES
   Net income                                                          $ 467           $ 386          $ 306
   Undistributed earnings of subsidiaries                               (420)           (348)          (279)
   Change in other assets and liabilities                                  3               -            (11)
-------------------------------------------------------------------------------------------------------------
     CASH PROVIDED BY OPERATING ACTIVITIES                                50              38             16
=============================================================================================================
INVESTING ACTIVITIES
   Sales (purchases) of investments                                        1              (2)             -
   Capital contribution to subsidiary                                      -            (190)          (180)
-------------------------------------------------------------------------------------------------------------
     CASH PROVIDED BY (USED FOR) INVESTING ACTIVITIES                      1            (192)          (180)
=============================================================================================================
FINANCING ACTIVITIES
   Decrease in allocated advances from parent                              -               -           (893)
   (Decrease) increase in short-term debt                                  -             (50)            50
   Proceeds from issuance of long-term debt                                -               -            650
   Proceeds from issuance of company obligated mandatorily
       redeemable preferred securities of subsidiary trust
       holding solely parent junior subordinated debentures                -             250              -
   Dividends paid                                                        (50)            (38)          (329)
   Net proceeds from the sale of common stock                              -               -            687
   Net issuance of common stock                                           (1)             (8)            (1)
-------------------------------------------------------------------------------------------------------------
     CASH (USED FOR) PROVIDED BY FINANCING ACTIVITIES                    (51)            154            164
=============================================================================================================
   Net change in cash                                                      -               -              -
   Cash - beginning of year                                                -               -              -
-------------------------------------------------------------------------------------------------------------
     CASH - END OF YEAR                                                $   -           $   -          $   -
=============================================================================================================
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
NET CASH ACTIVITY DURING THE YEAR FOR:
   Interest expense paid                                               $  65           $  54          $  55
   Tax refund received                                                 $  24           $  20          $  17

SUPPLEMENTAL DISCLOSURE OF NONCASH FINANCING ACTIVITIES:
   Capital contribution                                                $   -           $   -          $  12
   Capital contribution to subsidiaries                                $   -           $   -          $  46
</TABLE>

                                       S-3
<PAGE>   66
                      HARTFORD LIFE, INC. AND SUBSIDIARIES

                                  SCHEDULE III

                       SUPPLEMENTARY INSURANCE INFORMATION
              FOR THE YEARS ENDED DECEMBER 31, 1999, 1998 AND 1997

(In millions)

<TABLE>
<CAPTION>

                               Deferred                         Other
                                Policy                         Policy-       Premiums             Net
                             Acquisition     Future Policy     holder        and Other         Investment      Net Realized
          Segment               Costs          Benefits        Funds       Considerations        Income       Capital Losses
-----------------------------------------------------------------------------------------------------------------------------
<S>                          <C>             <C>              <C>          <C>                 <C>            <C>
1999
Investment Products             $3,165          $2,882        $ 8,987          $1,333            $  708             $  -
Individual Life                  1,013             331          2,415             412               172                -
Employee Benefits                   32           2,698            207           1,829               195                -
Corporate Owned Life
   Insurance                         -             321          5,244             400               431                -
Other                                -               4             20               5                56               (5)

-----------------------------------------------------------------------------------------------------------------------------
  CONSOLIDATED OPERATIONS       $4,210          $6,236        $16,873          $3,979            $1,562             $ (5)
=============================================================================================================================

1998
Investment Products             $2,860          $2,470        $ 9,226          $1,045            $  739             $  -
Individual Life                    958             567          2,307             378               189                -
Employee Benefits                   24           2,455            114           1,629               180                -
Corporate Owned Life
   Insurance                         -             225          8,097             774               793                -
Other                                -               -             23               7                54                -

-----------------------------------------------------------------------------------------------------------------------------
  CONSOLIDATED OPERATIONS       $3,842          $5,717        $19,767          $3,833            $1,955             $  -
=============================================================================================================================

1997
Investment Products             $2,479          $2,028        $ 9,621          $  771            $  739             $  -
Individual Life                    861             566          2,180             339               171                -
Employee Benefits                   21           2,261             84           1,538               162                -
Corporate Owned Life
   Insurance                         -              56          9,259             551               429                -
Other                                -              28             (5)            (36)               35                -
-----------------------------------------------------------------------------------------------------------------------------
  CONSOLIDATED OPERATIONS       $3,361          $4,939        $21,139          $3,163            $1,536             $  -
=============================================================================================================================
</TABLE>


<TABLE>
<CAPTION>
                              Benefits,       Amortization
                             Claims and       of Deferred
                                Claim            Policy
                             Adjustment       Acquisition    Dividends to           Other
          Segment             Expenses            Costs      Policyholders         Expenses*
--------------------------------------------------------------------------------------------
<S>                          <C>              <C>            <C>                  <C>
1999
Investment Products            $  668              $430            $  -           $  440
Individual Life                   258               129               -               88
Employee Benefits               1,507                 9               -              406
Corporate Owned Life
   Insurance                      621                 -             104               59
Other                               -                 -               -              131

--------------------------------------------------------------------------------------------
  CONSOLIDATED OPERATIONS      $3,054              $568            $104           $1,124
============================================================================================

1998
Investment Products            $  671              $326            $  -           $  376
Individual Life                   269               108               1               88
Employee Benefits               1,335                 7               -              369
Corporate Owned Life
   Insurance                      924                 -             329              278
Other                              28                 -               -               94

--------------------------------------------------------------------------------------------
  CONSOLIDATED OPERATIONS      $3,227              $441            $330           $1,205
============================================================================================

1997
Investment Products            $  677              $250            $  -           $  269
Individual Life                   251                87               1               84
Employee Benefits               1,301                 6               -              303
Corporate Owned Life
   Insurance                      439                 -             240              259
Other                               3                 2               -               47
--------------------------------------------------------------------------------------------
  CONSOLIDATED OPERATIONS      $2,671              $345            $241           $  962
============================================================================================
</TABLE>

* Includes interest expense.

                                      S-4
<PAGE>   67
                      HARTFORD LIFE, INC. AND SUBSIDIARIES

                                   SCHEDULE IV

                                   REINSURANCE

<TABLE>
<CAPTION>
                                                                                    Assumed
                                                                      Ceded to       From                      Percentage of
                                                        Gross          Other         Other          Net       Amount Assumed
(In millions)                                           Amount       Companies     Companies       Amount         to Net
----------------------------------------------------------------------------------------------------------------------------
<S>                                                    <C>           <C>           <C>            <C>         <C>
FOR THE YEAR ENDED DECEMBER 31, 1999

   Life insurance in force                             $515,119      $126,909       $14,903       $403,113         3.7%
----------------------------------------------------------------------------------------------------------------------------

   PREMIUMS AND OTHER CONSIDERATIONS
     Life insurance and annuities                      $  2,902      $    167       $    54       $  2,789         1.9%
     Accident and health insurance                        1,166            76           100          1,190         8.4%
----------------------------------------------------------------------------------------------------------------------------
       TOTAL PREMIUMS AND OTHER CONSIDERATIONS         $  4,068      $    243       $   154       $  3,979         3.9%
============================================================================================================================

FOR THE YEAR ENDED DECEMBER 31, 1998

   Life insurance in force                             $515,688      $194,092       $11,659       $333,255         3.5%
----------------------------------------------------------------------------------------------------------------------------

   PREMIUMS AND OTHER CONSIDERATIONS
     Life insurance and annuities                      $  2,839      $    151       $    62       $  2,750         2.3%
     Accident and health insurance                        1,107            60            36          1,083         3.3%
----------------------------------------------------------------------------------------------------------------------------
       TOTAL PREMIUMS AND OTHER CONSIDERATIONS         $  3,946      $    211       $    98       $  3,833         2.6%
============================================================================================================================

FOR THE YEAR ENDED DECEMBER 31, 1997

   Life insurance in force                             $396,736      $172,928       $42,729       $266,537        16.0%
----------------------------------------------------------------------------------------------------------------------------

   PREMIUMS AND OTHER CONSIDERATIONS
     Life insurance and annuities                      $  2,340      $    273       $    58       $  2,125         2.7%
     Accident and health insurance                        1,012            81           107          1,038        10.3%
----------------------------------------------------------------------------------------------------------------------------
       TOTAL PREMIUMS AND OTHER CONSIDERATIONS         $  3,352      $    354       $   165       $  3,163         5.2%
============================================================================================================================
</TABLE>

                                      S-5
<PAGE>   68
                      HARTFORD LIFE, INC. AND SUBSIDIARIES

                                   SCHEDULE V

                        VALUATION AND QUALIFYING ACCOUNTS

<TABLE>
<CAPTION>
                                                               Additions               Deductions
                                                        -------------------------      ----------
                                                        Charged to
                                            Balance     Costs and     Translation     Write-offs/        Balance
(In millions)                              January 1,   Expenses       Adjustment    Payments/Other    December 31,
--------------------------------------------------------------------------------------------------------------------
<S>                                        <C>          <C>           <C>            <C>               <C>
   1999
Accumulated depreciation of plant,
   property and equipment                    $ 137        $ 19           $  -            $ (2)            $ 154

   1998
Accumulated depreciation of plant,
   property and equipment                    $ 112        $ 34           $  -            $ (9)            $ 137

   1997
Accumulated depreciation of plant,
   property and equipment                    $ 101        $ 17           $  -            $ (6)            $ 112

--------------------------------------------------------------------------------------------------------------------
</TABLE>

                                      S-6
<PAGE>   69
                                   SIGNATURES

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

                                       HARTFORD LIFE, INC.

                                       By: /s/ Mary Jane B. Fortin
                                          -------------------------------------
                                       Mary Jane B. Fortin
                                       Vice President and Chief
                                       Accounting Officer

Date: March 24, 2000

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

<TABLE>
<CAPTION>
               SIGNATURE                                           TITLE                                          DATE
               ---------                                           -----                                          ----
<S>                                                   <C>                                                   <C>
/s/ Ramani Ayer                                                  Chairman                                    March 24, 2000
----------------------------------------
Ramani Ayer

/s/ Lowndes A. Smith                                   President, Chief Executive Officer                    March 24, 2000
----------------------------------------                       and Director
Lowndes A. Smith

/s/ Thomas M. Marra                                      Chief Operating Officer                             March 24, 2000
----------------------------------------                       and Director
Thomas M. Marra

/s/ David T. Foy                                           Senior Vice President                             March 24, 2000
----------------------------------------                and Chief Financial Officer
David T. Foy

/s/ Mary Jane B. Fortin                                       Vice President                                 March 24, 2000
----------------------------------------               and Chief Accounting Officer
Mary Jane B. Fortin

/s/ Gail Deegan                                                  Director                                    March 24, 2000
----------------------------------------
Gail Deegan

/s/ Donald R. Frahm                                              Director                                    March 24, 2000
----------------------------------------
Donald R. Frahm

/s/ Paul G. Kirk, Jr.                                            Director                                    March 24, 2000
----------------------------------------
Paul G. Kirk, Jr.

/s/ Robert E. Patricelli                                         Director                                    March 24, 2000
----------------------------------------
Robert E. Patricelli

/s/ Robert W. Selander                                           Director                                    March 24, 2000
----------------------------------------
Robert W. Selander

/s/ H. Patrick Swygert                                           Director                                    March 24, 2000
----------------------------------------
H. Patrick Swygert

/s/ Gordon I. Ulmer                                              Director                                    March 24, 2000
----------------------------------------
Gordon I. Ulmer

/s/ David K. Zwiener                                             Director                                    March 24, 2000
----------------------------------------
David K. Zwiener
</TABLE>

                                      II-1
<PAGE>   70
                      HARTFORD LIFE, INC. AND SUBSIDIARIES
                                    FORM 10-K
                   FOR THE FISCAL YEAR ENDED DECEMBER 31, 1998
                                 EXHIBITS INDEX
<TABLE>
<CAPTION>
EXHIBIT #
---------
<S>                 <C>
    3.01            Amended and Restated Certificate of Incorporation of Hartford Life, Inc. ("Hartford Life"
                    or the "Company") was filed as Exhibit 3.1 to the Company's Registration Statement on Form
                    S-1 dated February 10, 1997 (Registration No. 333-21459) and is incorporated herein by
                    reference.

    3.02            Amended and Restated By-Laws of the Company, amended effective December 18, 1997 was filed
                    as Exhibit 3.02 to the Company's Form 10-K filed for the fiscal year ended December 31,
                    1997 and is incorporated herein by reference.

    4.01            Amended and Restated Certificate of Incorporation and By-Laws of the Company (included as
                    Exhibits 3.01 and 3.02, respectively).

    4.02            Senior Indenture, dated as of May 19, 1997, between the Company and Citibank, N.A., as
                    trustee, with respect to the Company's 6.90% Notes due June 15, 2004, 7.10% Notes due June
                    15, 2007, and 7.65% Debentures due June 15, 2027, was filed as Exhibit 4.3 to the
                    Company's Registration Statement on Form S-3 (Amendment No. 2) dated May 23, 1997, and is
                    incorporated herein by reference.

    4.03            Subordinated Indenture between Hartford Life and Wilmington Trust Company, as Trustee,
                    dated as of June 1, 1998, was filed as Exhibit 4.03 to the Company's Form 10-K for the
                    fiscal year ended December 31, 1998 and is incorporated herein by reference.

    4.04            First Supplemental Indenture, dated as of June 29, 1998 between Hartford Life, as Issuer,
                    and Wilmington Trust Company, as Trustee, with respect to 7.2% Junior Subordinated
                    Deferrable Interest Debentures, due 2038, was filed as Exhibit 4.04 to the Company's Form
                    10-K for the fiscal year ended December 31, 1998 and is incorporated herein by reference.

    4.05            Form of Junior Subordinated Deferrable Interest Debenture, Series A, due 2038, included as
                    Exhibit A to Exhibit 4.04 filed herewith.

    4.06            Declaration of Trust of Hartford Life Capital I, dated as of June 3, 1998 between the
                    Company, as Sponsor, and Wilmington Trust Company, as Trustee, was filed as Exhibit 4.06
                    to the Company's Form 10-K for the fiscal year ended December 31, 1998 and is incorporated
                    herein by reference.

    4.07            Amended and Restated Declaration of Trust of Hartford Life Capital I, dated as of June 29,
                    1998 between the Trustee and the Sponsor, relating to the 7.2% Junior Subordinated
                    Deferrable Interest Debentures, Series A, due 2038, was filed as Exhibit 4.07 to the
                    Company's Form 10-K for the fiscal year ended December 31, 1998 and is incorporated herein
                    by reference.

    4.08            Form of Preferred Security Certificate for Hartford Capital I, included as Exhibit A-1 to
                    Exhibit 4.07 filed herewith.

    4.09            Preferred Securities Guarantee Agreement, dated as of June 29, 1998 between Hartford Life,
                    as Guarantor, and Wilmington Trust Company, as Preferred Guarantee Trustee, relating to
                    Hartford Life Capital I, was filed as Exhibit 4.09 to the Company's Form 10-K for the
                    fiscal year ended December 31, 1998 and is incorporated herein by reference.
</TABLE>

                                      II-2
<PAGE>   71
<TABLE>
<CAPTION>
<S>                 <C>
    10.01           Master Intercompany Agreement among the Company, The Hartford Financial Services Group,
                    Inc. (formerly known as ITT Hartford Group, Inc.) (The Hartford) and with respect to
                    Articles VI and XII, Hartford Fire Insurance Company, was filed as Exhibit 10.1 to the
                    Company's Form 10-Q filed for the quarterly period ended June 30, 1997 and is incorporated
                    herein by reference.

    10.02           Tax Sharing Agreement among The Hartford and its subsidiaries, including the Company, was
                    filed as Exhibit 10.2 to the Company's Form 10-Q filed for the quarterly period ended June
                    30, 1997 and is incorporated herein by reference.

    10.03           Management Agreement among Hartford Life Insurance Company and The Hartford Investment
                    Management Company, was filed as Exhibit 10.3 to the Company's Form 10-Q filed for the
                    quarterly period ended June 30, 1997 and is incorporated herein by reference.

    10.04           Management Agreement among certain subsidiaries of the Company and Hartford Investment
                    Services, Inc., was filed as Exhibit 10.4 to the Company's Form 10-Q filed for the
                    quarterly period ended June 30, 1997 and is incorporated herein by reference.

    10.05           Sublease Agreement between Hartford Fire Insurance Company and the Company, was filed as
                    Exhibit 10.5 to the Company's Form 10-Q filed for the quarterly period ended June 30, 1997
                    and is incorporated herein by reference.

    10.06*          1997 Hartford Life, Inc. Incentive Stock Plan, amended as of February 16, 2000, is
                    filed herewith.

    10.07*          1997 Hartford Life, Inc. Deferred Restricted Stock Unit Plan, as amended, was filed as
                    Exhibit 10.08 to the Company's Form 10-K for the fiscal year ended December 31, 1998 and
                    is incorporated herein by reference.

    10.08*          1997 Hartford Life, Inc. Restricted Stock Plan for Non-Employee Directors, as amended, was
                    filed as Exhibit 10.09 to the Company's Form 10-K for the fiscal year ended December 31,
                    1998 and is incorporated herein by reference.

    10.09*          The Hartford 1996 Deferred Compensation Plan was filed as Exhibit 10.18 to The Hartford's
                    Form 10-K (File No. 0-19277) for the fiscal year ended December 31, 1998 and is
                    incorporated herein by reference.

    10.10*          The Hartford 1997 Senior Executive Severance Pay Plan I, revised as of October 15, 1998,  was
                    filed as Exhibit 10.19 to The Hartford's Form 10-K (File No. 0-19277) for the fiscal year ended
                    December 31, 1998 and is incorporated herein by reference.

    10.11*          The Hartford Executive Severance Pay Plan, revised as of February 1, 1999, was filed as
                    Exhibit 10.20 to The Hartford's Form 10-K (File No. 0-19277) for the fiscal year ended
                    December 31, 1998 and is incorporated herein by reference.
</TABLE>

                                                     II-3
<PAGE>   72
<TABLE>
<CAPTION>
<S>                 <C>
    10.12*          Employment Agreement dated July 1, 1997 between the Company and The Hartford and Lowndes
                    A. Smith was filed as exhibit 10.02 to The Hartford's Form 10-Q filed for the quarterly
                    period ended September 30, 1997 and is incorporated herein by reference.

    10.13*          Form of Employment Protection Agreement between the Company and certain executive officers
                    of the Company was filed as Exhibit 10.12 to the Company's Form 10-K for the fiscal year
                    ended December 31, 1997 and is incorporated herein by reference.

    10.14           Amended and restated Credit Agreement dated as of February 9, 1998 among Hartford Life,
                    Inc., the lenders named therein and Citibank, N.A. as administrative agent was filed as
                    Exhibit 10.1 to the Company's Form 10-Q filed for the quarterly period ended March 31,
                    1998 and is incorporated herein by reference.

    12              Computation of Ratio of Earnings to Fixed Charges is filed herewith.

    21              Subsidiaries of Hartford Life, Inc. as of February 29, 2000 is filed herewith.

    23              Consent of Arthur Andersen LLP to the incorporation by reference into the Company's
                    Registration Statements on Form S-8 and Form S-3 of the Report of Arthur Andersen LLP
                    contained in this Form 10-K regarding the audited financial statements is filed herewith.

    27              Financial Data Schedule is filed herewith.
</TABLE>

     *  Management contract, compensatory plan or arrangement.

                                      II-4