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Derivative Instruments (Tables)

6 Months Ended

Jun. 30, 2012

Notes to Financial Statements [Abstract]

Outstanding derivative instruments with off-balance-sheet risks

				As of June 30, 2012						As of December 31, 2011
				Notional		Fair Value				Notional		Fair Value
				Amounts		Asset		Liability		Amounts		Asset		Liability
Qualifying Hedges
Cash flow hedges:
	Interest rate contracts⁽¹⁾			$	3,418	$	190	$	-	$	2,512	$	130	$	-
	Foreign currency contracts⁽¹⁾				420		37		-		340		38		-
		Total cash flow hedges			3,838		227		-		2,852		168		-
Fair value hedges:
	Interest rate contracts⁽¹⁾				1,175		325		-		1,675		319		-
	Equity collar⁽¹⁾				9		-		-		-		-		-
		Total fair value hedges			1,184		325		-		1,675		319		-
Non-Qualifying Hedges
Interest rate contracts⁽¹⁾					36,599		777		-		30,232		568		-
Foreign currency contracts⁽¹⁾					196		-		-		4		-		-
Equity market contracts⁽¹⁾					19,182		2,071		-		16,401		2,096		-
Credit contracts⁽¹⁾					46		(1)		-		48		-		-
Credit contracts⁽²⁾					148		-		11		148		-		16
Embedded derivatives:
	Indexed annuity contracts⁽³⁾				-		-		431		-		-		399
	Guaranteed living benefits ("GLB")
		reserves⁽³⁾			-		-		1,926		-		-		2,217
	Reinsurance related ⁽⁴⁾				-		-		185		-		-		168
			Total derivative instruments	$	61,193	$	3,399	$	2,553	$	51,360	$	3,151	$	2,800

Maturity of the notional amounts of derivative financial instruments

			Remaining Life as of June 30, 2012
			Less Than		1 – 5		6 – 10		11 – 30		Over 30
			1 Year		Years		Years		Years		Years		Total
Interest rate contracts⁽¹⁾			$	3,389	$	11,942	$	14,478	$	10,169	$	1,213	$	41,191
Foreign currency contracts⁽²⁾				196		179		130		111		-		616
Equity market contracts				9,978		3,305		5,881		24		3		19,191
Credit contracts				40		155		-		-		-		195
	Total derivative instruments
		with notional amounts	$	13,603	$	15,581	$	20,489	$	10,304	$	1,216	$	61,193

Change in our unrealized gain on derivative instruments in accumulated OCI

						For the Six
						Months Ended
						June 30,
						2012		2011
Unrealized Gain (Loss) on Derivative Instruments
Balance as of beginning-of-year						$	119	$	(15)
Other comprehensive income (loss):
	Cumulative effect from adoption of new accounting standards						-		3
	Unrealized holding gains (losses) arising during the year:
		Cash flow hedges:
			Interest rate contracts				38		(41)
			Foreign currency contracts				(3)		5
		Fair value hedges:
			Interest rate contracts				2		2
	Change in foreign currency exchange rate adjustment						2		(14)
	Change in DAC, VOBA, DSI and DFEL						4		-
	Income tax benefit (expense)						(16)		18
	Less:
		Reclassification adjustment for gains (losses) included in net income (loss):
			Cash flow hedges:
				Interest rate contracts⁽¹⁾			(11)		(5)
				Interest rate contracts⁽²⁾			-		1
				Foreign currency contracts⁽¹⁾			2		(7)
			Fair value hedges:
				Interest rate contracts⁽²⁾			2		2
		Associated amortization of DAC, VOBA, DSI and DFEL					1		1
		Income tax benefit (expense)					2		3
					Balance as of end-of-period	$	150	$	(37)

Gains (losses) on derivative instruments recorded within income (loss) from continuing operations

				For the Three				For the Six
				Months Ended				Months Ended
				June 30,				June 30,
				2012		2011		2012		2011
Qualifying Hedges
Cash flow hedges:
	Interest rate contracts⁽¹⁾			$	(4)	$	(4)	$	(11)	$	(5)
	Foreign currency contracts⁽¹⁾				-		(1)		2		1
		Total cash flow hedges			(4)		(5)		(9)		(4)
Fair value hedges:
	Interest rate contracts⁽²⁾				11		13		23		25
Non-Qualifying Hedges
Interest rate contracts⁽¹⁾					(16)		(10)		(18)		(16)
Interest rate contracts⁽³⁾					622		88		208		27
Foreign currency contracts⁽³⁾					-		(1)		(4)		(5)
Equity market contracts⁽³⁾					241		64		(430)		(135)
Equity market contracts⁽⁴⁾					26		(15)		(109)		(34)
Credit contracts⁽¹⁾					(1)		-		(2)		-
Credit contracts⁽³⁾					1		(1)		6		3
Embedded derivatives:
	Indexed annuity contracts⁽³⁾				23		6		(80)		54
	GLB reserves⁽³⁾				(862)		(160)		291		130
	Reinsurance related⁽³⁾				(27)		(28)		(18)		(18)
	AFS securities⁽¹⁾				-		-		-		1
			Total derivative instruments	$	14	$	(49)	$	(142)	$	28

Gains (losses) on derivative instruments designated as cash flow hedges

		For the Three				For the Six
		Months Ended				Months Ended
		June 30,				June 30,
		2012		2011		2012		2011
Gain (loss) recognized as a component of OCI with
	the offset to net investment income	$	(6)	$	(4)	$	(10)	$	(4)

Gains (losses) on derivative instruments designated as fair value hedges

		For the Three				For the Six
		Months Ended				Months Ended
		June 30,				June 30,
		2012		2011		2012		2011
Gain (loss) recognized as a component of OCI with
	the offset to interest expense	$	1	$	1	$	2	$	2

Open credit default swap liabilities

As of June 30, 2012

Credit

Reason

Nature

Rating of

Number

Maximum

for

Underlying

Fair

Potential

Maturity

Entering

Recourse

Obligation⁽¹⁾

Instruments

Value⁽²⁾

Payout

12/20/2012⁽³⁾

⁽⁵⁾

⁽⁶⁾

BBB+

12/20/2016⁽⁴⁾

⁽⁵⁾

⁽⁶⁾

BBB

(8)

03/20/2017⁽⁴⁾

⁽⁵⁾

⁽⁶⁾

BBB

(3)

(11)

148

As of December 31, 2011

Credit

Reason

Nature

Rating of

Number

Maximum

for

Underlying

Fair

Potential

Maturity

Entering

Recourse

Obligation⁽¹⁾

Instruments

Value⁽²⁾

Payout

12/20/2012⁽³⁾

⁽⁵⁾

⁽⁶⁾

BBB+

12/20/2016⁽⁴⁾

⁽⁵⁾

⁽⁶⁾

BBB+

(12)

03/20/2017⁽⁴⁾

⁽⁵⁾

⁽⁶⁾

BBB

(4)

(16)

148

Collateral support agreements

				As of			As of
			June 30,			December 31,
				2012			2011
Maximum potential payout				$	148		$	148
Less:
	Counterparty thresholds				-			-
		Maximum collateral potentially required to post		$	148		$	148

	As of June 30, 2012				As of December 31, 2011
	Collateral		Collateral		Collateral		Collateral
	Posted by		Posted by		Posted by		Posted by
S&P	Counter-		LNC		Counter-		LNC
Credit	Party		(Held by		Party		(Held by
Rating of	(Held by		Counter-		(Held by		Counter-
Counterparty	LNC)		Party)		LNC)		Party)

AA	$	43	$	-	$	35	$	-
AA-		121		-		219		-
A+		908		-		848		-
A		845		(109)		1,681		(120)
A-		1,529		-		387		-
	$	3,446	$	(109)	$	3,170	$	(120)

- Definition

Tabular disclosure of credit derivatives which includes information by sellers of credit derivatives, about each credit derivative, or each group of similar credit derivatives, including (a) the nature of the credit derivative - its term, how it arose, the events or circumstances that would require the seller to perform under the credit derivative, and the current status of the payment/performance risk of the credit derivative; (b) the maximum potential amount of future payments (undiscounted) the seller could be required to make under the credit derivative; (c) the current fair value of the credit derivative; and (d) the nature of any recourse provisions under the credit derivative, and any assets held either as collateral or by third parties. A credit derivative is a derivative instrument (1) in which one or more of its underlyings are related to the credit risk of a specified entity (or a group of entities) or an index based on the credit risk of a group of entities and (2) that exposes the seller to potential loss from credit-risk-related events specified in the contract. Examples of credit derivatives within the scope of this paragraph include, but are not limited to, credit default swaps, credit spread options, and credit index products; also includes a hybrid instrument that has an embedded credit derivative (for example, but not limited to, a credit-linked note).

+ References+ Details

- Definition

Tabular disclosure of the location and amount of gains and losses reported in the statement of financial performance, or when applicable, the statement of financial position. For example, (a) gains and losses recognized in the income statement on derivative instruments designated and qualifying as hedging instruments in fair value hedges and related hedged items designated and qualifying in fair value hedges and (b) gains and losses initially recognized in other comprehensive income on derivative instruments designated and qualifying as cash flow hedges.

+ References+ Details

- Definition

Tabular disclosure of the location and fair value amounts of derivative instruments (and nonderivative instruments that are designated and qualify as hedging instruments) reported in the statement of financial position.

+ References+ Details

- Definition

Tabular disclosure of pertinent information about a derivative or group of derivatives on a disaggregated basis, such as for individual instruments, or small groups of similar instruments. May include a combination of the type of instrument, risks being hedged, notional amount, hedge designation, related hedged item, inception date, maturity date, or other relevant item.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Accounting Standards Codification

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-Publisher FASB

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+ Details