This document is dated February 13, 2006. It may not be accurate after such date and LNC does not undertake to update or keep it accurate after such date.

12/31/2005 ii

NOTES

Definitions and Presentation

"Income from Operations," "Operating Revenue," and "Return on Capital" are non-GAAP financial measures and do not replace GAAP net income (loss) and revenues. Detailed reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measure are included in this statistical supplement.

* We exclude the after-tax effects of the following items from GAAP net income to arrive at income from operations:

*	Realized gains and losses on investments and derivatives,
*	Restructuring charges,
*	Gains and losses related to reinsurance embedded derivatives/trading account securities,
*	The cumulative effect of accounting changes,
*	Reserve changes on business sold through reinsurance net of related deferred gain amortization,
*	Gains and losses on the sale of subsidiaries and blocks of business,
*	Loss on early retirement of debt, including subordinated debt

* Operating revenue represents revenue excluding the following, as applicable:

*	Realized gains or losses on investments and derivatives,
*	Gains and losses related to reinsurance embedded derivatives/trading account securities,
*	Gains and losses on the sale of subsidiaries and blocks of business,
*	Deferred gain amortization related to reserve changes on business sold through reinsurance,

* Return on capital measures the effectiveness of LNC's use of its total capital, which includes equity (excluding accumulated other comprehensive income), debt and junior subordinated debentures issued to affiliated trusts. Return on capital is calculated by dividing income from operations (after adding back interest expense) by average capital. The difference between return on capital and return on shareholders' equity represents the effect of leveraging on LNC's consolidated results.

Income from operations, operating revenue, and return on capital are internal measures used by LNC in the management of its operations. Management believes that these performance measures explain the results of operations of LNC's ongoing operations in a manner that allows for a better understanding of the underlying trends in LNC's current business because the excluded items are either unpredictable and/or not related to decisions regarding the underlying businesses.

*	Certain operating and statistical measures are included in this report to provide supplemental data regarding the performance of LNC’s current business. These measures include deposits, sales, net flows, first year premium, inforce, spread, and assets under management.
*	On September 24, 2004, LNC completed the sale of its London-based international investment unit to its management. Certain metrics pages (2 and 14A) have been presented excluding the investment assets managed by the London-based international investment unit to provide more consistent comparisons between periods.
*	Certain reclassifications have been made to the prior periods presented to conform to the December 31, 2005 presentation.

Accounting Changes

* Effective January 1, 2004 LNC Implemented Statement of Position 03-1, "Accounting and reporting by Insurance Enterprises for certain nontraditional long-duration contracts and for Separate Accounts" ("the SOP"). Among other things, the SOP establishes standards for computing reserves for products with guaranteed benefits such as GMDB and for certain riders for Universal Life contracts. The effects of implementing the SOP, including any related effects on DAC from changes in estimated gross profits resulting from implementing the provisions of the SOP were recorded as a cumulative effect adjustment of $24.5 million in the first quarter of 2004.

12/31/2005										PAGE 1
Financial Highlights
Unaudited [Millions of Dollars, except Common Share Data]
	For the Quarter Ended						For the Year Ended
	December 31						December 31
	2005			2004			2005			2004
	Amount			Amount			Amount			Amount
Income from Operations - By Segment
Lincoln Retirement	$	117.3		$	100.5		$	471.5		$	414.6
Life Insurance		80.2			74.0			298.9			280.3
Investment Management		14.6			5.2			36.0			43.6
Lincoln UK		13.5			16.6			43.4			43.5
Corporate & Other		6.7			(6.3	)		1.8			(57.2	)
Total Income from Operations		232.3			189.9			851.6			724.8
Realized gains (losses) on investments and derivatives		(6.1	)		4.3			(14.5	)		(37.4	)
Net gain (loss) on reinsurance
derivative/trading account securities		-			(0.8	)		3.0			(0.6	)
Gain on sale of subsidiaries/ businesses		-			0.4			9.3			61.9
Reserve development/ amortization of related deferred gain		0.2			0.2			0.9			0.9
Loss on early retirement of subordinated debt		-			(4.1	)		-			(4.1	)
Restructuring charges		(1.1	)		(0.0	)		(19.1	)		(13.9	)
Cumulative effect of accounting change		-			-			-			(24.5	)
Net Income	$	225.3		$	189.9		$	831.1		$	707.0
Earnings per share (diluted)
Income from Operations	$	1.31		$	1.07		$	4.83		$	4.05
Realized gains (losses) on investments and derivatives		(0.03	)		0.02			(0.08	)		(0.21	)
Net gain (loss) on reinsurance
derivative/trading account securities		-			-			0.02			-
Gain on sale of subsidiaries/ businesses		-			-			0.05			0.35
Reserve development/ amortization of related deferred gain		-			-			-			-
Loss on early retirement of subordinated debt		-			(0.02	)		-			(0.02	)
Restructuring charges		-			-			(0.11	)		(0.08	)
Cumulative effect of accounting change		-			-			-			(0.14	)
Net Income	$	1.28		$	1.07		$	4.72		$	3.95
Operating Revenue- By Segment
Lincoln Retirement	$	573.3		$	539.4		$	2,258.0		$	2,128.0
Life Insurance		519.6			503.7			1,993.5			1,952.9
Investment Management		152.7			127.7			567.8			534.9
Lincoln UK		62.5			89.3			318.4			342.2
Corporate & Other		89.2			81.1			352.1			335.1
Total Operating Revenue		1,397.4			1,341.2			5,489.8			5,293.2
Realized gains (losses) on investments		(9.6	)		7.2			(21.7	)		(45.7	)
Gains (losses) on derivatives		0.2			(0.4	)		(0.5	)		(11.6	)
Gain (loss) on reinsurance
derivative/trading account securities		0.0			(1.4	)		4.7			(1.0	)
Gain on sale of subsidiaries/ businesses		-			0.6			14.2			135.0
Amortization of deferred gain-reserve development		0.3			0.3			1.3			1.3
Total Revenue	$	1,388.4		$	1,347.5		$	5,487.9		$	5,371.3

12/31/2005							PAGE 2
Financial Highlights
Unaudited [Billions of Dollars]
	For the Quarter Ended				For the Year Ended
Operational Data by Segment	December 31				December 31
	2005		2004		2005		2004
	Amount		Amount		Amount		Amount
Lincoln Retirement
Gross Deposits	$	2.639	$	2.387	$	10.310	$	9.020
Net Flows		0.621		0.794		2.887		2.922
Account Values (Gross)		72.462		64.788		72.462		64.788
Account Values (Net of Reinsurance)		70.229		62.491		70.229		62.491
Life Insurance Segment
First Year Premium- Retail (in millions)	$	262.644	$	231.160	$	845.428	$	812.565
First Year Premium- COLI (in millions)		13.113		20.376		70.481		73.657
First Year Premium- Total (in millions)		275.757		251.537		915.910		886.222
In-force		324.369		304.579		324.369		304.579
Account Values		15.368		14.382		15.368		14.382
Investment Management Segment
Retail Deposits	$	3.158	$	2.519	$	14.056	$	8.992
Retail Net Flows		1.347		1.170		7.098		3.136
Institutional In-flows		4.217		2.750		14.633		11.289
Institutional Net Flows		1.930		2.095		8.861		7.178
Total Deposits and In-flows		7.375		5.269		28.689		20.281
Total Net Flows		3.277		3.265		15.959		10.314
Assets Under Management- Retail and Inst'l		77.093		56.029		77.093		56.029
Assets Under Management - Insurance-related Assets		44.483		43.980		44.483		43.980
Assets Under Management - Total Segment		121.576		100.009		121.576		100.009
Consolidated
Domestic Retail Deposits	$	6.188	$	5.290	$	25.494	$	19.280
Domestic Retail Account Balances		122.004		103.784		122.004		103.784
Domestic Retail Net Flows		2.348		2.527		11.207		7.335
Domestic Deposits		10.386		8.038		40.041		30.479
Domestic Net Flows		4.368		4.622		20.238		14.545
Assets Under Management		171.718		144.340		171.718		144.340
Operational Data (excluding Assets Managed by
Delaware's London-based International Investment Unit)
Investment Management Segment
Retail Deposits	$	3.158	$	2.519	$	14.056	$	8.987
Retail Net Flows		1.347		1.170		7.098		3.160
Institutional In-flows		4.217		2.750		14.633		6.637
Institutional Net Flows		1.930		2.095		8.861		3.884
Total Deposits and In-flows		7.375		5.269		28.689		15.624
Total Net Flows		3.277		3.265		15.959		7.045
Assets Under Management- Retail and Inst'l		77.093		56.029		77.093		56.029
Assets Under Management - Insurance-related Assets		44.483		43.980		44.483		43.980
Assets Under Management - Total Segment		121.576		100.009		121.576		100.009
Consolidated
Domestic Retail Deposits	$	6.188	$	5.290	$	25.494	$	19.274
Domestic Retail Account Balances		122.004		103.784		122.004		103.784
Domestic Retail Net Flows		2.348		2.527		11.207		7.359
Domestic Deposits		10.386		8.038		40.041		25.823
Domestic Net Flows		4.368		4.622		20.238		11.274
Assets Under Management		171.718		144.340		171.718		144.340

12/31/2005										PAGE 3
Financial Highlights
Unaudited [Millions of Dollars, except Common Share Data]
	For the Quarter Ended						For the Year Ended
	December 31						December 31
	2005			2004			2005			2004
	Amount			Amount			Amount			Amount
Balance Sheet Assets - End of Period	$	124,787.6		$	116,219.3		$	124,787.6		$	116,219.3
Shareholders' Equity
Beg of Period (including AOCI)	$	6,284.4		$	5,970.8		$	6,175.6		$	5,811.6
End of Period (including AOCI)		6,384.4			6,175.6			6,384.4			6,175.6
End of Period (excluding AOCI)		5,856.6			5,244.9			5,856.6			5,244.9
Average Equity (excluding AOCI)		5,757.7			5,185.0			5,512.2			5,075.5
Return on Equity
Net Income/Average Equity (excluding AOCI)		15.7	%		14.6	%		15.1	%		13.9	%
Inc from Operations/Average Equity (excluding AOCI)		16.1	%		14.7	%		15.4	%		14.3	%
Return on Capital
Inc from Operations/Average Capital		13.5	%		12.1	%		12.9	%		11.7	%
Common Stock Outstanding
Average for the Period - Diluted		176.6			176.7			176.1			179.0
End of Period - Assuming Conv of Pref.		174.0			173.8			174.0			173.8
End of Period - Diluted		176.9			176.1			176.9			176.1
Book Value (including AOCI)	$	36.69		$	35.53		$	36.69		$	35.53
Book Value (excluding AOCI)	$	33.66		$	30.17		$	33.66		$	30.17
Cash Returned to Shareholders
Share Repurchase - dollar amount	$	-		$	64.0		$	103.6		$	350.2
Dividends Declared to Shareholders		66.6			63.8			257.7			250.1
Total Cash Returned to Shareholders	$	66.6		$	127.8		$	361.3		$	600.3
Share Repurchase - number of shares		-			1.379			2.331			7.612
Dividend Declared on Common Stock - per share	$	0.380		$	0.365		$	1.475		$	1.415
		For the Quarter Ended						For the Year Ended
		December 31						December 31
		2005			2004			2005			2004
		Amount			Amount			Amount			Amount
Comprehensive Income (Loss)
Net Income	$	225.3		$	189.9		$	831.1		$	707.0
Foreign Currency Translation		(16.1	)		37.4			(70.9	)		45.3
Net Unrealized Gains (Losses) on Securities		(72.4	)		42.8			(326.3	)		29.8
Losses on Derivatives		(1.5	)		(5.8	)		(6.7	)		(8.1	)
Minimum Pension Liability Adjustment		(2.9	)		(4.8	)		1.0			(5.4	)
Comprehensive Income	$	132.3		$	259.5		$	428.2		$	768.6

12/31/2005										PAGE 4
Consolidated Statements of Income
Unaudited [Millions of Dollars]
	For the Quarter Ended December 31						For the Year Ended December 31
	2005			2004			2005			2004
Revenue
Premiums	$	82.4		$	78.7		$	308.4		$	298.9
Surrender charges		18.0			21.1			73.3			78.7
Mortality assessments		145.1			140.4			568.3			558.3
Expense assessments		308.5			258.5			1,120.6			949.3
Investment advisory fees		79.0			56.0			279.0			252.5
Amortization of deferred gain		18.9			19.1			75.7			87.0
Amortization of deferred gain-reserve development		0.3			0.3			1.3			1.3
Other revenue and fees		77.3			93.4			362.3			364.4
Net investment income		668.1			674.1			2,702.3			2,704.1
Realized gains (losses) on investments		(9.6	)		7.2			(21.7	)		(45.7	)
Gains (losses) on derivatives		0.2			(0.4	)		(0.5	)		(11.6	)
Net gain (loss) on reinsurance
derivative/trading account securities		0.0			(1.4	)		4.7			(1.0	)
Gain on sale of subsidiaries/ businesses		-			0.6			14.2			135.0
Total Revenue		1,388.4			1,347.5			5,487.9			5,371.3
Benefits and Expenses
Ins. benefits paid or provided:
Policy benefits		179.5			171.4			761.6			696.2
Div accum & div to policyholders		23.6			23.6			77.7			77.4
Interest credited to policy bal.		394.7			397.4			1,570.1			1,570.6
Def. sales inducements net of amortization		(11.3	)		(11.5	)		(43.9	)		(40.6	)
Total insurance benefits		586.5			580.9			2,365.6			2,303.7
Underwriting, acquisition,
insurance and other expenses:
Commissions and other volume related expenses		357.2			331.3			1,287.2			1,133.1
Operating and administrative expenses		217.3			193.1			914.1			897.4
Restructuring charges		1.7			0.1			29.5			21.4
Taxes, licenses and fees		17.2			21.3			95.3			103.6
Subtotal		593.4			545.8			2,326.1			2,155.5
DAC deferral net of amortization		(125.4	)		(84.9	)		(442.1	)		(354.1	)
PVIF amortization		13.6			24.2			67.2			120.3
Other intangibles amortization		2.0			3.8			7.8			9.7
Total underwriting, acquisition,
insurance and other expenses		483.6			488.9			1,959.0			1,931.5
Interest		22.4			22.2			88.7			94.1
Loss on early retirement of debt					6.3						6.3
Total Benefits and Expenses		1,092.5			1,098.4			4,413.3			4,335.6
Income (Loss) Before Federal Income Tax and
Cumulative Effect of Accounting Change		295.9			249.1			1,074.6			1,035.7
Federal income taxes		70.6			59.2			243.6			304.1
Income Before Cumulative Effect of
Accounting Change		225.3			189.9			831.1			731.5
Cumulative effect of accounting change		-			-			-			(24.5	)
Net Income	$	225.3		$	189.9		$	831.1		$	707.0
Roll Forward of Deferred Acquisition Costs
Balance at beginning of period	$	3,904.0		$	3,326.8		$	3,445.0		$	3,147.1
Deferral		253.5			238.1			903.2			844.8
Amortization		(128.1	)		(153.2	)		(461.1	)		(490.8	)
Included in Total Benefits and Expenses		125.4			84.9			442.1			354.1
Adjustment related to realized (gains) losses
on available-for-sale securities		(8.7	)		(15.8	)		(48.5	)		(45.7	)
Adjustment related to unrealized (gains) losses
on available-for-sale securities		84.7			14.7			313.1			(14.8	)
Foreign currency translation adjustment		(13.2	)		33.8			(59.5	)		42.9
Other		-			0.5			-			(38.7	)
Balance at end of period	$	4,092.2		$	3,445.0		$	4,092.2		$	3,445.0
Roll Forward of Present Value of In-Force
Balance at beginning of period	$	1,019.4		$	1,103.9		$	1,095.2		$	1,196.5
Amortization		(13.6	)		(24.2	)		(67.2	)		(120.3	)
Foreign currency translation adjustment		(6.9	)		15.6			(29.0	)		19.6
Other		-			-			-			(0.6	)
Balance at end of period	$	998.9		$	1,095.2		$	998.9		$	1,095.2
Roll Forward of Deferred Front-End Load*
Balance at beginning of period	$	721.2		$	744.4		$	764.1		$	750.6
Deferral		23.7			28.6			89.1			104.6
Amortization		(11.9	)		(34.0	)		(85.8	)		(122.8	)
Included in Income from Operations		11.8			(5.3	)		3.3			(18.2	)
Foreign currency translation adjustment		(9.5	)		25.0			(43.9	)		31.7
Balance at end of period	$	723.6		$	764.1		$	723.6		$	764.1
* Included in Insurance and Investment Contract Liabilities on the Balance Sheet

12/31/2005																						PAGE 5
Consolidating Statements of Income from Operations
Unaudited [Millions of Dollars]
													Investment
For the Quarter Ended December 31	Lincoln Retirement						Life Insurance						Management						Lincoln UK
	Dec			Dec			Dec			Dec			Dec			Dec			Dec			Dec
	2005			2004			2005			2004			2005			2004			2005			2004
Operating Revenue
Premiums	$	9.2		$	9.9		$	57.8		$	53.6		$	-		$	-		$	15.4		$	14.9
Surrender charges		5.9			6.4			11.6			14.2			0.5			0.5			-			-
Mortality assessments		-			-			137.8			130.5			-			-			7.3			9.8
Expense assessments		199.6			157.1			62.3			58.0			17.6			15.5			29.1			28.3
Investment advisory fees		-			-			-			-			103.5			82.8			-			-
Other revenue and fees		(1.9	)		(2.0	)		8.9			8.1			17.8			16.7			(7.1	)		16.0
Net investment income		360.6			368.0			241.2			239.4			13.2			12.3			17.8			20.2
Total Operating Revenue		573.3			539.4			519.6			503.7			152.7			127.7			62.5			89.3
Operating Expenses
Ins. benefits paid or provided:
Policy benefits		49.9			43.4			102.1			106.4			-			-			27.5			21.3
Div accum & div to policyholders		-			-			23.6			23.6			-			-			-			-
Interest credited to policy bal.		202.9			210.4			150.2			147.1			7.1			6.8			-			-
Def. sales inducements net of amortization		(11.3	)		(11.5	)		-			-			-			-			-			-
Total insurance benefits		241.6			242.2			275.9			277.2			7.1			6.8			27.5			21.3
Underwriting, acquisition,
insurance and other expenses:
Commissions and other volume related expenses		162.8			156.7			109.2			99.4			15.9			11.7			0.1			1.0
Operating and administrative expenses		69.8			59.6			43.3			42.9			109.5			100.2			24.2			14.1
Taxes, licenses and fees		1.5			2.5			14.7			12.5			2.8			3.1			0.0			-
Subtotal		234.0			218.8			167.3			154.7			128.2			114.9			24.3			15.1
Net DAC (deferral) amortization		(58.0	)		(49.0	)		(56.1	)		(54.0	)		(3.9	)		(3.9	)		(7.4	)		21.9
PVIF amortization		2.4			2.3			13.8			16.4			-			-			(2.5	)		5.6
Other intangibles amortization		-			-			-			-			2.0			3.8			-			-
Total underwriting, acquisition,
insurance and other expenses		178.4			172.1			124.9			117.1			126.3			114.8			14.3			42.5
Total Operating Expenses		420.0			414.3			400.8			394.3			133.3			121.7			41.8			63.8
Income from Operations before federal taxes		153.4			125.1			118.8			109.5			19.4			6.0			20.7			25.5
Federal income taxes		36.1			24.7			38.6			35.5			4.8			0.8			7.2			8.9
Income from Operations	$	117.3		$	100.5		$	80.2		$	74.0		$	14.6		$	5.2		$	13.5		$	16.6

12/31/2005																PAGE 5A
Consolidating Statements of Income from Operations
Unaudited [Millions of Dollars]
	Corporate and						Consolidating
For the Quarter Ended December 31	Other Operations						Adjustments						Consolidated *
	Dec			Dec			Dec			Dec			Dec			Dec
	2005			2004			2005			2004			2005			2004
Operating Revenue
Premiums	$	-		$	0.3		$	-		$	-		$	82.4		$	78.7
Surrender charges		-			-			-			-			18.0			21.1
Mortality assessments		-			-			-			-			145.1			140.4
Expense assessments		-			(0.5	)		-			-			308.5			258.5
Investment advisory fees		-			-			(24.5	)		(26.8	)		79.0			56.0
Amortization of deferred gain		18.9			19.1			-			-			18.9			19.1
Other revenue and fees		220.7			172.4			(161.1	)		(117.7	)		77.3			93.4
Net investment income		36.5			34.8			(1.3	)		(0.6	)		668.1			674.1
Total Operating Revenue		276.1			226.2			(186.9	)		(145.1	)		1,397.4			1,341.2
Operating Expenses
Ins. benefits paid or provided:
Policy benefits		(0.0	)		0.4			-			-			179.5			171.4
Div accum & div to policyholders		-			-			-			-			23.6			23.6
Interest credited to policy bal.		34.5			33.1			-			-			394.7			397.4
Def. sales inducements net of amortization		-			-			-			-			(11.3	)		(11.5	)
Total insurance benefits		34.4			33.4			-			-			586.5			580.9
Underwriting, acquisition,
insurance and other expenses:
Commissions and other volume related expenses		137.8			87.7			(68.6	)		(25.2	)		357.2			331.3
Operating and administrative expenses		88.4			95.8			(117.3	)		(119.3	)		217.9			193.2
Taxes, licenses and fees		(1.7	)		3.3			-			-			17.2			21.3
Subtotal		224.5			186.9			(185.9	)		(144.5	)		592.3			545.9
Net DAC (deferral) amortization		0.1			0.1			-			-			(125.4	)		(84.9	)
PVIF amortization		-			-			-			-			13.6			24.2
Other intangibles amortization		-			-			-			-			2.0			3.8
Total underwriting, acquisition,
insurance and other expenses		224.6			186.9			(185.9	)		(144.5	)		482.5			489.0
Interest		22.9			22.8			(1.0	)		(0.6	)		21.8			22.1
Foreign exchange adjustment		-			(0.0	)		-			-			-			(0.0	)
Total Operating Expenses		281.8			243.1			(186.9	)		(145.1	)		1,090.9			1,092.0
Income (Loss) from Operations before federal taxes		(5.7	)		(16.9	)								306.5			249.2
Federal income taxes		(12.5	)		(10.6	)								74.3			59.3
Income (Loss) from Operations	$	6.7		$	(6.3	)							$	232.3		$	189.9
* See page 1 for a reconciliation of Income from Operations to consolidated Net Income

12/31/2005																						PAGE 6
Consolidating Statements of Income from Operations
Unaudited [Millions of Dollars]
													Investment
For the Year Ended December 31	Lincoln Retirement						Life Insurance						Management						Lincoln UK
	Dec			Dec			Dec			Dec			Dec			Dec			Dec			Dec
	2005			2004			2005			2004			2005			2004			2005			2004
Operating Revenue
Premiums	$	45.7		$	33.0		$	198.7		$	194.0		$	-		$	-		$	63.3		$	70.3
Surrender charges		27.4			25.0			43.6			51.8			2.3			1.9			-			-
Mortality assessments		-			-			533.6			518.7			-			-			34.8			39.5
Expense assessments		727.1			580.5			213.1			208.6			68.9			56.8			111.5			103.9
Investment advisory fees		-			-			-			-			377.8			358.3			-			-
Other revenue and fees		(6.2	)		(6.3	)		34.0			31.4			65.8			66.2			30.3			52.8
Net investment income		1,463.9			1,495.9			970.7			948.4			53.0			51.7			78.6			75.7
Total Operating Revenue		2,258.0			2,128.0			1,993.5			1,952.9			567.8			534.9			318.4			342.2
Operating Expenses
Ins. benefits paid or provided:
Policy benefits		223.0			189.9			422.3			404.1			-			-			116.0			100.4
Div accum & div to policyholders		-			-			77.7			77.4			-			-			-			-
Interest credited to policy bal.		819.0			836.0			590.2			579.7			27.9			26.9			-			-
Def. sales inducements net of amortization		(43.9	)		(40.6	)		-			-			-			-			-			-
Total insurance benefits		998.1			985.2			1,090.3			1,061.2			27.9			26.9			116.0			100.4
Underwriting, acquisition,
insurance and other expenses:
Commissions and other volume related expenses		626.3			586.7			362.6			331.1			60.1			53.0			2.3			2.9
Operating and administrative expenses		259.2			231.8			176.4			168.6			430.3			392.9			98.3			81.0
Taxes, licenses and fees		10.5			14.6			53.9			49.1			10.7			17.0			0.0			-
Subtotal		895.9			833.1			592.9			548.9			501.1			462.9			100.6			83.9
Net DAC (deferral) amortization		(275.8	)		(247.9	)		(191.9	)		(152.2	)		(19.8	)		(27.1	)		45.1			72.8
PVIF amortization		16.6			20.0			60.6			82.2			-			-			(10.1	)		18.1
Other intangibles amortization		-			-			-			-			7.8			9.7			-			-
Total underwriting, acquisition,
insurance and other expenses		636.7			605.2			461.6			478.9			489.0			445.5			135.7			174.8
Total Operating Expenses		1,634.8			1,590.5			1,551.9			1,540.0			516.9			472.5			251.7			275.2
Income from Operations before federal taxes		623.2			537.6			441.6			412.9			50.9			62.4			66.7			67.0
Federal income taxes		151.7			123.0			142.7			132.6			14.9			18.9			23.4			23.4
Income from Operations	$	471.5		$	414.6		$	298.9		$	280.3		$	36.0		$	43.6		$	43.4		$	43.5

12/31/2005																PAGE 6A
Consolidating Statements of Income from Operations
Unaudited [Millions of Dollars]
	Corporate and						Consolidating
For the Year Ended December 31	Other Operations						Adjustments						Consolidated *
	Dec			Dec			Dec			Dec			Dec			Dec
	2005			2004			2005			2004			2005			2004
Operating Revenue
Premiums	$	0.7		$	1.6		$	-		$	-		$	308.4		$	298.9
Surrender charges		-			-			-			-			73.3			78.7
Mortality assessments		-			-			-			-			568.3			558.3
Expense assessments		-			(0.5	)		-			-			1,120.6			949.3
Investment advisory fees		-			-			(98.8	)		(105.8	)		279.0			252.5
Amortization of deferred gain		75.7			87.0			-			-			75.7			87.0
Other revenue and fees		803.0			629.9			(564.7	)		(409.6	)		362.3			364.4
Net investment income		140.4			134.4			(4.2	)		(1.8	)		2,702.3			2,704.1
Total Operating Revenue		1,019.8			852.3			(667.7	)		(517.2	)		5,489.8			5,293.2
Operating Expenses
Ins. benefits paid or provided:
Policy benefits		0.3			1.9			-			-			761.6			696.2
Div accum & div to policyholders		-			-			-			-			77.7			77.4
Interest credited to policy bal.		133.0			128.0			-			-			1,570.1			1,570.6
Def. sales inducements net of amortization		-			-			-			-			(43.9	)		(40.6	)
Total insurance benefits		133.3			129.9			-			-			2,365.6			2,303.7
Underwriting, acquisition,
insurance and other expenses:
Commissions and other volume related expenses		501.3			317.2			(265.3	)		(157.8	)		1,287.2			1,133.1
Operating and administrative expenses		350.5			380.9			(399.2	)		(357.6	)		915.5			897.5
Taxes, licenses and fees		20.1			22.8			-			-			95.3			103.6
Subtotal		872.0			720.9			(664.5	)		(515.4	)		2,298.0			2,134.3
Net DAC (deferral) amortization		0.4			0.4			-			-			(442.1	)		(354.1	)
PVIF amortization		-			-			-			-			67.2			120.3
Other intangibles amortization		-			-			-			-			7.8			9.7
Total underwriting, acquisition,
insurance and other expenses		872.4			721.3			(664.5	)		(515.4	)		1,930.9			1,910.2
Interest		90.5			95.9			(3.2	)		(1.8	)		87.3			94.0
Foreign Exchange		-			-			-			-			-			-
Total Operating Expenses		1,096.2			947.0			(667.7	)		(517.2	)		4,383.8			4,307.9
Income (Loss) from Operations before federal taxes		(76.4	)		(94.7	)		-			-			1,106.1			985.2
Federal income taxes		(78.1	)		(37.4	)		-			-			254.5			260.5
Income (Loss) from Operations	$	1.8		$	(57.2	)	$	-		$	-		$	851.6		$	724.8
* See page 1 for a reconciliation of Income from Operations to consolidated Net Income

12/31/2005				PAGE 7
Comparative Balance Sheet
Unaudited [Millions of Dollars except Common Share Data]
ASSETS	2005			2004
Investments
Corporate bonds	$	25,860.7		$	26,889.0
U.S. government bonds		161.8			163.0
Foreign government bonds		1,203.3			1,285.9
Mortgage backed securities		5,951.2			6,090.5
State and municipal bonds		128.8			166.0
Preferred stocks-redeemable		137.4			106.1
Common stocks		55.9			69.8
Preferred stocks-equity		88.8			91.3
Total AFS Securities		33,587.9			34,861.7
Trading securities		3,246.0			3,237.4
Mortgage loans		3,662.6			3,856.9
Real estate		182.7			191.4
Policy loans		1,862.2			1,870.6
Other long-term investments		626.9			489.3
Total Investments		43,168.4			44,507.3
Cash and invested cash		2,311.7			1,661.7
Premiums and fees receivable		343.2			232.9
Accrued investment income		526.4			525.1
Amounts recoverable from reinsurers		6,926.3			7,067.5
Deferred acquisition costs		4,092.2			3,445.0
Other intangible assets		143.3			106.4
Present value of in-force		998.9			1,095.2
Goodwill		1,194.2			1,195.9
Other		1,336.0			1,177.6
Assets held in separate accounts		63,746.8			55,204.6
Total Assets	$	124,787.6		$	116,219.3
LIABILITIES and SHAREHOLDERS' EQUITY
Liabilities
Insurance and Investment Contract Liabilities:
Reserves	$	23,609.2		$	23,242.1
Unpaid claims		1,040.8			1,080.3
Unearned premiums		2.1			5.8
Premium deposit funds		21,713.3			22,215.1
Participating policyholders' funds		111.2			145.3
Other policyholders' funds		746.1			714.0
Total Ins and Inv Contr Liabilities		47,222.8			47,402.5
Federal income tax liabilities		19.8			77.6
Short-term debt		119.9			214.4
Long-term debt		999.0			1,048.6
Junior subordinated debentures issued to affiliated trusts		334.0			339.8
Embedded derivative - modco		292.2			375.3
Other liabilities		4,832.8			4,467.8
Deferred gain on indemnity reinsurance		836.0			913.0
Liability related to separate accounts		63,746.8			55,204.6
Total Liabilities		118,403.2			110,043.7
Unrealized gains		503.9			836.9
Foreign currency		83.4			154.3
Minimum pension liability adjustment		(59.5	)		(60.5	)
Shareholders' equity- other		5,856.6			5,244.9
Total Shareholders' Equity		6,384.4			6,175.6
Total Liabilities
and Shareholders' Equity	$	124,787.6		$	116,219.3
Shareholders' Equity Per Share
Book Value, Excluding AOCI	$	33.66		$	30.17
Common shares outstanding (in millions)		174.0			173.8

12/31/2005																			PAGE 8
Consolidating Balance Sheets
Unaudited [Millions of Dollars]
													Investment
	Lincoln Retirement						Life Insurance						Management				Lincoln UK
ASSETS	Dec			Dec			Dec			Dec			Dec		Dec		Dec		Dec
	2005			2004			2005			2004			2005		2004		2005		2004
Investments
Corporate bonds	$	12,688.1		$	13,504.1		$	9,038.9		$	8,887.9		$	515.9	$	533.3	$	646.7	$	739.2
U.S. government bonds		11.3			11.9			71.0			63.8			-		-		-		-
Foreign government bonds		275.9			304.5			176.6			184.7			6.8		6.8		302.2		337.6
Asset/mortgage backed securities		3,277.3			3,332.3			1,901.1			1,739.5			91.9		99.6		-		-
State and municipal bonds		67.2			95.3			42.7			52.4			1.1		1.2		-		-
Preferred stocks-redeemable		61.2			37.6			28.4			25.7			-		-		-		-
Common stocks		-			0.2			0.0			0.2			-		-		43.0		46.4
Preferred stocks-equity		42.2			43.1			14.2			14.8			2.7		2.7		-		-
Total AFS Securities		16,423.1			17,329.1			11,273.0			10,968.9			618.4		643.7		991.9		1,123.3
Trading Securities		1,130.6			1,169.6			-			-			-		-		-		-
Mortgage loans		1,720.6			1,936.3			1,621.4			1,554.2			44.1		62.6		0.0		0.1
Real estate		-			-			-			-			-		-		0.2		0.2
Policy loans		431.7			438.7			1,426.0			1,426.0			-		-		4.4		5.9
Allocated investments		3,645.9			3,891.1			1,545.0			1,442.7			159.5		139.9		-		-
Other long-term investments		155.0			61.8			3.3			9.1			-		-		-		-
Total Investments		23,507.0			24,826.6			15,868.8			15,400.9			822.1		846.3		996.6		1,129.5
Notes receivable from LNC		423.3			107.8			56.8			130.7			76.3		44.4		-		-
Cash and invested cash		(113.3	)		(73.9	)		(40.7	)		18.0			95.3		51.1		245.5		282.9
Premium and fees receivable		(0.0	)		0.2			32.3			25.8			56.7		45.4		-		-
Accrued investment income		236.5			243.3			179.2			173.8			8.2		8.6		20.2		22.1
Amount recoverable from reinsurers		937.2			1,030.7			1,273.0			1,183.4			-		-		59.9		-
Deferred acquisition costs		1,480.5			1,040.4			1,970.0			1,691.9			154.5		120.4		486.3		590.9
Other intangible assets		129.4			85.5			-			-			13.9		20.9		-		-
Present value of in-force		76.0			92.6			665.8			726.5			-		-		257.2		276.1
Goodwill		64.1			64.1			855.1			855.1			260.8		260.8		14.3		15.9
Other		183.0			145.2			507.9			468.0			127.3		96.4		113.9		80.3
Assets held in separate accounts		48,182.0			40,990.1			2,482.7			2,131.1			5,762.5		4,897.2		7,319.6		7,186.2
Total Assets	$	75,105.6		$	68,552.7		$	23,850.9		$	22,805.0		$	7,377.6	$	6,391.5	$	9,513.3	$	9,583.9
		Corporate and						Consolidating
		Other Operations						Adjustments										Consolidated
ASSETS		Dec			Dec			Dec			Dec							Dec		Dec
		2005			2004			2005			2004							2005		2004
Investments
Corporate bonds	$	2,971.1		$	3,224.5		$	-		$	-						$	25,860.7	$	26,889.0
U.S. government bonds		79.5			87.4			-			-							161.8		163.0
Foreign government bonds		441.8			452.3			-			-							1,203.3		1,285.9
Asset/mortgage backed securities		680.9			919.0			-			-							5,951.2		6,090.5
State and municipal bonds		17.7			17.1			-			-							128.8		166.0
Preferred stocks-redeemable		47.9			42.8			-			-							137.4		106.1
Common stocks		13.0			22.9			-			-							55.9		69.8
Preferred stocks-equity		29.6			30.7			-			-							88.8		91.3
Total AFS Securities		4,281.4			4,796.7			-			-							33,587.9		34,861.7
Trading securities		2,115.4			2,067.8			-			-							3,246.0		3,237.4
Mortgage loans		276.5			303.6			-			-							3,662.6		3,856.9
Real estate		182.5			191.1			-			-							182.7		191.4
Policy loans		-			-			-			-							1,862.2		1,870.6
Allocated investments		(5,350.5	)		(5,473.7	)		-			-							-		-
Other long-term investments		468.6			418.4			-			-							626.9		489.3
Total Investments		1,974.0			2,304.0			(0.0	)		(0.0	)						43,168.4		44,507.3
Investments In Consolidated Subs		6,077.7			5,545.6			(6,077.7	)		(5,545.6	)						-		-
Notes receivable from LNC		(521.6	)		(152.9	)		(34.8	)		(130.0	)						-		-
Cash and invested cash		2,124.9			1,383.6			-			-							2,311.7		1,661.7
Premium and fees receivable		254.3			161.5			-			-							343.2		232.9
Accrued investment income		82.2			77.4			-			-							526.4		525.1
Amount recoverable from reinsurers		4,656.2			4,853.5			-			-							6,926.3		7,067.5
Deferred acquisition costs		1.0			1.4			-			-							4,092.2		3,445.0
Other intangible assets		-			-			-			-							143.3		106.4
Present value of in-force		-			-			-			-							998.9		1,095.2
Goodwill		-			-			-			-							1,194.2		1,195.9
Other		414.8			398.8			(10.9	)		(11.0	)						1,336.1		1,177.7
Assets held in separate accounts		-			-			-			-							63,746.8		55,204.6
Total Assets	$	15,063.7		$	14,572.8		$	(6,123.5	)	$	(5,686.7	)					$	124,787.6	$	116,219.3

12/31/2005																				PAGE 9
Consolidating Balance Sheets
Unaudited [Millions of Dollars]
													Investment
	Lincoln Retirement						Life Insurance						Management				Lincoln UK
LIABILITIES and SHAREHOLDERS' EQUITY	Dec			Dec			Dec			Dec			Dec		Dec		Dec			Dec
	2005			2004			2005			2004			2005		2004		2005			2004
Liabilities
Insurance and Inv Contract Liabilities:
Reserves	$	2,251.7		$	2,268.9		$	16,149.7		$	15,411.7		$	-	$	-	$	1,332.0		$	1,491.8
Unpaid claims		29.0			38.4			129.5			158.0			-		-		44.8			51.9
Unearned premiums		-			-			-			-			-		-		-			-
Premium deposit funds		20,816.8			21,336.8			17.3			17.1			739.9		716.0		31.9			29.7
Participating policyholders' funds		-			-			111.2			145.3			-		-		-			-
Other policyholders' funds		-			-			741.1			706.1			-		-		-			-
Total Insurance and Inv Contract Liabilities		23,097.6			23,644.0			17,148.9			16,438.2			739.9		716.0		1,408.6			1,573.5
Federal income taxes		284.3			387.0			92.9			208.3			11.8		6.2		86.9			58.6
Notes payable to LNC		0.8			51.4			-			-			-		-		-			-
Embedded derivative - modco		40.5			80.5			2.8			2.5			-		-		-			-
Other liabilities		154.2			157.1			498.8			520.8			308.3		227.5		209.8			215.0
Deferred gain on indemnity reinsurance		-			-			-			-			-		-		-			-
Liability related to separate accounts		48,182.0			40,990.1			2,482.7			2,131.1			5,762.5		4,897.2		7,319.6			7,186.2
Total Liabilities		71,759.4			65,310.1			20,226.0			19,300.9			6,822.5		5,846.9		9,025.0			9,033.4
Net unrealized gains (losses) on securities		274.3			474.8			140.6			244.2			2.1		3.1		45.2			36.2
Net gains (losses) on derivatives		1.2			4.8			5.9			7.7			-		-		-			-
Foreign currency translation adjustment		-			-			-			-			-		-		65.8			136.4
Minimum pension liability adjustment		-			-			-			-			0.5		-		(53.3	)		(48.6	)
Other shareholders' equity		3,070.7			2,762.9			3,478.4			3,252.3			552.4		541.5		430.6			426.6
Shareholders' Equity		3,346.2			3,242.5			3,624.9			3,504.1			555.1		544.6		488.3			550.6
Total Liabilities and Shareholders' Equity	$	75,105.6		$	68,552.7		$	23,850.9		$	22,805.0		$	7,377.6	$	6,391.5	$	9,513.3		$	9,583.9
		Corporate and						Consolidating
		Other Operations						Adjustments										Consolidated
LIABILITIES and SHAREHOLDERS' EQUITY		Dec			Dec			Dec			Dec							Dec			Dec
		2005			2004			2005			2004							2005			2004
Liabilities
Insurance and Inv Contract Liabilities:
Reserves	$	3,875.9		$	4,069.7		$	-		$	-						$	23,609.2		$	23,242.1
Unpaid claims		837.5			832.0			-			-							1,040.8			1,080.3
Unearned premiums		2.1			5.7			-			-							2.1			5.8
Premium deposit funds		107.4			115.6			-			-							21,713.3			22,215.1
Participating policyholders' funds		-			-			-			-							111.2			145.3
Other policyholders' funds		5.0			7.9			-			-							746.1			714.0
Total Insurance and Inv Contract Liabilities		4,827.8			5,030.9			-			-							47,222.8			47,402.5
Federal income taxes		(456.2	)		(583.3	)		-			0.8							19.8			77.6
Short-term debt		119.9			214.4			-			-							119.9			214.4
Long-term debt		999.0			1,048.6			-			-							999.0			1,048.6
Junior subordinated debentures issued to affiliated trusts		334.0			339.8			-			-							334.0			339.8
Notes payable to LNC		33.9			78.6			(34.8	)		(130.0	)						-			-
Embedded derivative - modco		248.9			292.3			-			-							292.2			375.3
Other liabilities		3,672.6			3,358.4			(10.9	)		(11.0	)						4,832.8			4,467.8
Deferred gain on indemnity reinsurance		836.0			913.0			-			-							836.0			913.0
Liability related to separate accounts		(0.0	)		-			-			-							63,746.8			55,204.6
Total Liabilities		10,615.9			10,692.7			(45.7	)		(140.3	)						118,403.2			110,043.7
Net unrealized gains (losses) on securities		35.8			64.4			(1.4	)		-							496.6			822.9
Gains (losses) on derivatives		0.2			1.6			-			-							7.3			14.0
Foreign currency translation adjustment		10.1			10.4			7.5			7.5							83.4			154.3
Minimum pension liability adjustment		(6.7	)		(11.9	)		-			-							(59.5	)		(60.5	)
Other shareholders' equity		4,408.3			3,815.5			(6,083.9	)		(5,553.9	)						5,856.6			5,244.9
Shareholders' Equity		4,447.8			3,880.1			(6,077.8	)		(5,546.4	)						6,384.4			6,175.6
Total Liabilities and Shareholders' Equity	$	15,063.7		$	14,572.8		$	(6,123.5	)	$	(5,686.7	)					$	124,787.6		$	116,219.3

12/31/2005										PAGE 10
Lincoln Retirement
Account Value Rollforward
Unaudited [Billions of Dollars]
	Fourth Quarter						Full Year
	2005			2004			2005			2004
Fixed Annuities - Balance at Beginning of Period	$	21.319		$	21.633		$	21.565		$	21.220
Gross Deposits		0.696			0.732			2.947			3.110
Withdrawals & deaths		(0.676	)		(0.587	)		(2.714	)		(2.227	)
Net flows		0.021			0.145			0.234			0.884
Transfer from (to) var annuities		(0.460	)		(0.429	)		(1.548	)		(1.395	)
Interest credited		0.209			0.216			0.838			0.856
Fixed Annuities-Gross		21.089			21.565			21.089			21.565
Reinsurance Ceded		(2.233	)		(2.297	)		(2.233	)		(2.297	)
Fixed Annuities - Balance at End of Period*	$	18.856		$	19.268		$	18.856		$	19.268
Variable Annuities - Balance at Beginning of Period	$	45.059		$	36.268		$	40.362		$	33.930
Gross Deposits		1.720			1.433			6.296			5.082
Withdrawals & deaths		(1.134	)		(0.990	)		(4.299	)		(3.797	)
Net flows		0.586			0.443			1.997			1.285
Transfer from (to) fixed annuities		0.464			0.427			1.559			1.387
Invest inc & change in mkt value		1.493			3.224			3.683			3.760
Var Annuities - Balance at End of Period**	$	47.601		$	40.362		$	47.601		$	40.362
Total Annuities - Balance at Beginning of Period	$	66.378		$	57.901		$	61.927		$	55.150
Gross Deposits		2.416			2.164			9.244			8.192
Withdrawals & deaths		(1.809	)		(1.576	)		(7.013	)		(6.023	)
Net flows		0.607			0.588			2.231			2.169
Transfers		0.003			(0.002	)		0.011			(0.008	)
Interest credited & change in mkt value		1.702			3.440			4.521			4.616
Total Gross Annuities- Balance at End of Period		68.690			61.927			68.690			61.927
Reinsurance Ceded		(2.233	)		(2.297	)		(2.233	)		(2.297	)
Total Annuities (Net of Ceded) - Balance at End of Period	$	66.457		$	59.630		$	66.457		$	59.629
Alliance Mutual Funds - Balance at Beg of Period***	$	3.672		$	2.430		$	2.861		$	1.856
Gross Deposits		0.223			0.223			1.066			0.828
Withdrawals & deaths		(0.208	)		(0.017	)		(0.410	)		(0.075	)
Net flows		0.014			0.206			0.656			0.753
Transfers		(0.003	)		0.000			(0.007	)		(0.031	)
Interest credited & change in mkt value		0.088			0.225			0.262			0.282
Total Alliance Mutual Funds - Balance at End of Period	$	3.772		$	2.861		$	3.772		$	2.861
Total Annuities and Alliance Mutual Funds -
Balance Beginning of Period	$	70.050		$	60.331		$	64.788		$	57.006
Gross Deposits		2.639			2.387			10.310			9.020
Withdrawals & deaths		(2.018	)		(1.593	)		(7.423	)		(6.098	)
Net flows		0.621			0.794			2.887			2.922
Transfers		0.000			(0.002	)		0.004			(0.039	)
Interest credited & change in mkt value		1.790			3.665			4.783			4.898
Total Gross Annuities and Alliance -         Balance End of Period		72.462			64.788			72.462			64.788
Reinsurance Ceded		(2.233	)		(2.297	)		(2.233	)		(2.297	)
Total Annuities and Alliance Mutual Funds
Balance at End of Period - (net of ceded)	$	70.229		$	62.491		$	70.229		$	62.491
Run-off Group Pension Accounts - Not Included above		2.737			2.906			2.737			2.906
Total Retirement Segment Account Values - (net of ceded)	$	72.966		$	65.397		$	72.966		$	65.397
Var Ann Under Agreement - Included above		0.216			0.266			0.216			0.266
Incremental Deposits****:
Fixed Annuities Incremental Deposits	$	0.642		$	0.718		$	2.828		$	3.046
Variable Annuities Incremental Deposits		1.687			1.402			6.164			4.928
Total Annuities Incremental Deposits		2.328			2.120			8.992			7.974
Total Alliance Mutual Funds Incremental Deposits		0.223			0.223			1.066			0.828
Total Annuities and Alliance Mutual Funds
Incremental Deposits	$	2.551		$	2.342		$	10.058		$	8.802

* Includes Fixed Annuity products offered under the Alliance program and the fixed portion of variable annuities.

** Excludes the fixed portion of variable annuities.

*** Represents amounts attributable to Alliance program mutual fund net flows. Alliance program mutual fund account values are not included in the separate accounts reported on our balance sheet.

**** Incremental Deposits represent gross deposits reduced by transfers from other Lincoln Retirement products.

12/31/2005										PAGE 11
Lincoln Retirement
Account Values
Unaudited [Billions of Dollars]
	Fourth Quarter						Full Year
	2005			2004			2005			2004
Fixed Annuities - excluding fixed portion of variable contracts
Deposits	$	0.158		$	0.192		$	0.681		$	1.026
Withdrawals		(0.374	)		(0.302	)		(1.456	)		(1.119	)
Net Flows	$	(0.216	)	$	(0.110	)	$	(0.776	)	$	(0.093	)
Gross Fixed Contract Account Values	$	11.519		$	11.820		$	11.519		$	11.820
Reinsurance Ceded		(2.233	)		(2.297	)		(2.233	)		(2.297	)
Net Fixed Contract Account Values	$	9.286		$	9.522		$	9.286		$	9.522
Fixed Portion of Variable Contracts
Deposits	$	0.539		$	0.540		$	2.267		$	2.085
Withdrawals		(0.302	)		(0.284	)		(1.257	)		(1.108	)
Net Flows	$	0.237		$	0.255		$	1.010		$	0.977
Fixed Portion of Variable Contract Account Values	$	9.570		$	9.746		$	9.570		$	9.746
Variable Annuities - including fixed portion of variable contracts
Deposits	$	2.258		$	1.972		$	8.563		$	7.166
Withdrawals		(1.436	)		(1.274	)		(5.556	)		(4.904	)
Net Flows	$	0.823		$	0.698		$	3.007		$	2.262
Variable Contract Account Values	$	57.171		$	50.108		$	57.171		$	50.108
Average Daily Variable Annuity Account Values	$	45.828		$	38.269		$	42.816		$	36.018
Alliance Mutual Funds Contracts
Deposits	$	0.223		$	0.223		$	1.066		$	0.828
Withdrawals		(0.208	)		(0.017	)		(0.410	)		(0.075	)
Net Flows	$	0.014		$	0.206		$	0.656		$	0.753
Alliance Mutual Funds Contract Account Values*	$	3.772		$	2.861		$	3.772		$	2.861
Average Daily Alliance Mutual Funds Acct Vals*	$	3.728		$	2.620		$	3.401		$	2.304
* Alliance program mutual fund account values are not included in the separate accounts reported on our balance sheet
Total Annuity Product Spread Information (1)
Net investment income (2) (3)		6.13	%		6.23	%		6.07	%		6.28	%
Interest credited to policyholders		3.79	%		3.87	%		3.81	%		3.92	%
Spread (2) (3)		2.34	%		2.36	%		2.26	%		2.37	%

(1) For the annuity products spread, the yield on earning assets is calculated as net investment income on fixed product investment portfolios divided by average earning assets. The average crediting rate is calculated using interest credited on annuity products less bonus credits and excess DCA interest, divided by average fixed account values net of co-insured account values. Fixed account values reinsured under modified co-insurance agreements are included in account values for this calculation since assets (and therefore margin) are retained under these agreements.

(2) The net investment income and spread reported above includes earnings from commercial mortgage loan prepayment and bond make-whole premiums.  The impact of these premiums on investment income and spread was 11 bps and 17 bps for the 4th quarters of 2005 and 2004, respectively, and 8 bps and 20 bps in for the full year 2005 and 2004, respectively.

(3) 2004 includes income from contingent interest received, which contributed $13 million to net investment income or 6 bps to the yield and spread for for the full year.

12/31/2005							PAGE 12
Life Insurance Segment
Operational Data
Unaudited [Millions of Dollars]
	Fourth Quarter				Full Year
	2005		2004		2005		2004
First Year Premiums by Product (Millions)
Universal Life
Excluding MoneyGuard	$	144.4	$	114.5	$	438.4	$	401.1
MoneyGuard		62.5		66.6		226.0		244.5
Total		206.9		181.1		664.4		645.6
Variable Universal Life		33.4		27.5		106.6		84.8
Whole Life		14.4		13.1		40.7		41.2
Term		8.0		9.4		33.8		41.0
Total Retail		262.6		231.2		845.4		812.6
Corporate Owned Life Insurance (COLI)		13.1		20.4		70.5		73.7
Total	$	275.8	$	251.5	$	915.9	$	886.2
First Year Premiums by Distribution (Millions)
Lincoln Financial Advisors	$	50.1	$	66.1	$	183.1	$	209.3
Lincoln Financial Distributors		200.0		167.4		676.2		623.7
Other*		25.7		18.0		56.6		53.2
Total by Distribution	$	275.8	$	251.5	$	915.9	$	886.2
Life Insurance In-Force (Billions)
Universal Life & Other	$	136.519	$	132.120	$	136.519	$	132.120
Term Insurance		187.850		172.459		187.850		172.459
Total Life Segment In-Force	$	324.369	$	304.579	$	324.369	$	304.579
*Other consists of distribution arrangements with third-party intermediaries.

12/31/2005													PAGE 13
Life Insurance Segment
Life Insurance Account Value Rollforward
Unaudited [Billions of Dollars]
	Fourth Quarter						Full Year
	2005			2004			2005			2004
Universal Life-Bal Beg-of-Period	$	10.053		$	9.444		$	9.648		$	9.030
Deposits		0.429			0.413			1.432			1.433
Withdrawals & deaths		(0.105	)		(0.117	)		(0.422	)		(0.474	)
Net flows		0.324			0.296			1.010			0.959
Policyholder assessments		(0.213	)		(0.196	)		(0.804	)		(0.753	)
Interest credited		0.107			0.105			0.418			0.413
Universal Life-Bal End of Period (1)	$	10.271		$	9.648		$	10.271		$	9.648
Variable Universal Life-Bal Beg-of-Period	$	2.734		$	2.275		$	2.520		$	2.195
Deposits		0.136			0.192			0.535			0.560
Withdrawals & deaths		(0.045	)		(0.111	)		(0.242	)		(0.315	)
Net flows		0.091			0.081			0.294			0.245
Policyholder assessments		(0.054	)		(0.050	)		(0.202	)		(0.194	)
Invest inc & chg in mkt value		0.089			0.214			0.249			0.273
Variable Universal Life -Bal end of Period	$	2.861		$	2.520		$	2.861		$	2.520
Interest Sensitive Whole Life - Bal Beg-of-Period	$	2.213		$	2.193		$	2.214		$	2.195
Deposits		0.083			0.082			0.272			0.250
Withdrawals & deaths		(0.048	)		(0.050	)		(0.220	)		(0.207	)
Net flows		0.035			0.032			0.052			0.043
Policyholder assessments		(0.045	)		(0.041	)		(0.176	)		(0.149	)
Interest credited		0.034			0.030			0.146			0.126
Int Sensitive Whole Life-Bal End -of -Period	$	2.236		$	2.214		$	2.236		$	2.214
Total Segment- Life Insurance Account Values
Bal Beg-of-Period	$	15.001		$	13.912		$	14.382		$	13.420
Deposits		0.648			0.686			2.240			2.243
Withdrawals & deaths		(0.198	)		(0.278	)		(0.884	)		(0.996	)
Net flows		0.450			0.408			1.356			1.247
Policyholder assessments		(0.312	)		(0.287	)		(1.182	)		(1.096	)
Invest inc & change in market value		0.230			0.348			0.813			0.812
Total Segment -Bal end of year	$	15.368		$	14.382		$	15.368		$	14.382
Life Product Spread Information (2)
Interest Sensitive Products
Net investment income (3)(4)		6.26	%		6.50	%		6.32	%		6.67	%
Interest credited to policyholders		4.66	%		4.80	%		4.69	%		4.85	%
Spread (3)(4)		1.60	%		1.69	%		1.63	%		1.81	%
Traditional Products
Net investment income (3)(4)		6.36	%		6.60	%		6.43	%		6.90	%
(1) Includes fixed investment option of VUL products.
(2) Interest Sensitive Products - For the life products spread, the yield on earning assets is calculated as net investment income on fixed product investment portfolios divided by average earning assets. The average crediting rate is calculated using interest credited on life products divided by average fixed account values. Traditional Products - the yield on earning assets is calculated as net investment income on non-par investment portfolios divided by average earning assets. As of year ends 2004 and 2005, interest sensitive products represented 88% and 89%, respectively, of total interest sensitive and traditional non-par earning assets.
(3) The net investment income and spread reported above includes earnings from commercial mortgage loan prepayment and bond make-whole premiums.  The impact of these premiums on investment income and spread for interest sensitive products was 11 bps and 13 bps for the 4th quarter of 2005 and 2004, respectively, and 7 bps and 20 bps for the full year of 2005 and 2004, respectively. The impact for traditional products was 7 bps for the 4th quarter of 2004 and 6 bps and 18 bps for the full year of 2005 and 2004, respectively. There was no impact for the 4th quarter of 2005.
(4) 2004 includes income from contingent interest received, which contributed $6.5 million to net investment income or 6 bps to the yield and spread on Interest Sensitive Products and $2.4 million to net investment income or 17 bps to the yield and spread on Traditional Products.

12/31/2005										PAGE 14
Investment Management
Assets Under Management Rollforward
Unaudited [Billions of Dollars]
	Fourth Quarter						Full Year
	2005			2004			2005			2004
Retail Fixed - Bal Beg-of-Period	$	9.061		$	8.060		$	8.257		$	8.186
Fund Sales		0.661			0.493			2.483			1.882
Redemptions		(0.432	)		(0.299	)		(1.476	)		(1.520	)
Net Money Market		(0.010	)		(0.020	)		(0.060	)		(0.113	)
Transfers		(0.102	)		(0.040	)		(0.082	)		(0.212	)
Net Flows		0.117			0.134			0.865			0.037
Market		0.021			0.125			0.079			0.290
Transfer of Assets Under Administration(1)		-			(0.062	)		(0.001	)		(0.256	)
Balance end of period	$	9.199		$	8.257		$	9.199		$	8.257
Retail Equity - Bal Beg-of-Period	$	33.449		$	22.620		$	26.130		$	20.887
Fund Sales		2.497			2.026			11.573			7.110
Redemptions		(1.310	)		(0.953	)		(5.138	)		(4.054	)
Transfers		0.042			(0.037	)		(0.203	)		0.042
Net Flows		1.229			1.036			6.233			3.099
Market		0.796			2.685			3.114			3.256
Sale of subsidiary/Transfer of Assets Under
Administration (1) (2)		-			(0.211	)		(0.003	)		(1.112	)
Balance at end of period	$	35.474		$	26.130		$	35.474		$	26.130
Total Retail - Bal Beg-of-Period	$	42.509		$	30.680		$	34.387		$	29.073
Retail Sales-Annuities		0.815			0.737			2.957			2.757
Retail Sales-Mutual Funds		1.110			0.922			4.860			3.235
Retail Sales-Managed Acct. & Other		1.232			0.860			6.239			2.999
Total Retail Sales		3.158			2.519			14.056			8.992
Redemptions		(1.741	)		(1.252	)		(6.613	)		(5.574	)
Net Money Market		(0.010	)		(0.020	)		(0.060	)		(0.113	)
Transfers		(0.060	)		(0.077	)		(0.285	)		(0.170	)
Net Flows		1.347			1.170			7.098			3.136
Market		0.817			2.810			3.193			3.546
Sale of subsidiary/Transfer of Assets Under
Administration (1) (2)		-			(0.273	)		(0.004	)		(1.368	)
Balance at end of period(1) (2)	$	44.673		$	34.387		$	44.673		$	34.387
Institutional Fixed - Bal Beg-of-Period	$	12.219		$	7.906		$	9.960		$	8.399
Inflows		0.937			2.100			4.277			5.134
Withdrawals/Terminations		(0.132	)		(0.077	)		(1.300	)		(0.593	)
Transfers		(0.001	)		0.001			0.000			0.009
Net Flows (2)		0.803			2.024			2.977			4.549
Market		0.019			0.031			0.104			0.135
Sale of Subsidiary (2)		-			-			-			(3.124	)
Balance at end of period (2)	$	13.042		$	9.960		$	13.042		$	9.960
Institutional Equity - Bal Beg-of-Period	$	17.760		$	10.490		$	11.682		$	25.322
Inflows		3.280			0.650			10.356			6.155
Withdrawals/Terminations		(2.160	)		(0.607	)		(4.520	)		(3.583	)
Transfers		0.006			0.029			0.048			0.057
Net Flows		1.127			0.072			5.884			2.629
Market		0.492			1.120			1.813			2.394
Sale of Subsidiary (2)		-			-			-			(18.664	)
Balance at end of period	$	19.379		$	11.682		$	19.379		$	11.682
Total Institutional - Bal Beg-of-Period	$	29.979		$	18.396		$	21.643		$	33.722
Inflows		4.217			2.750			14.633			11.289
Withdrawals/Terminations		(2.292	)		(0.684	)		(5.820	)		(4.176	)
Transfers		0.005			0.030			0.048			0.066
Net Flows		1.930			2.095			8.861			7.178
Market		0.511			1.151			1.917			2.530
Sale of Subsidiary (2)		-			-			-			(21.787	)
Balance at end of period	$	32.420		$	21.643		$	32.420		$	21.643
Total Retail/Institutional - At end of period	$	77.093		$	56.029		$	77.093		$	56.029
Insurance-related Assets - At end of period	$	44.483		$	43.980		$	44.483		$	43.980
Total Retail/Inst - Net Flows	$	3.277		$	3.265		$	15.959		$	10.314
Total Assets Under Management
At end of period	$	121.576		$	100.009		$	121.576		$	100.009
Subadvised Assets, included in Assets Under Management above
Retail	$	17.162		$	10.740		$	17.162		$	10.740
Institutional		4.782			3.740			4.782			3.740
Total Subadvised Assets	$	21.945		$	14.480		$	21.945		$	14.480
(1) Retail assets under management include assets under administration related to the mutual fund-based 401(k) business. In the third quarter of 2004, this business was outsourced to Bisys. As a result, the third and fourth quarter of 2004 had net outflows of assets under administration of approximately $0.776 billion and $0.273 billion, respectively.
(2) In the third quarter of 2004, the Investment Management segment sold its London-based international investment unit. Assets under management transferred as a result of the sale were $22.1 billion. See page 16A for assets under management without the London-based international investment unit. In addition, the London-based international investment unit began subadvising certain retail and institutional assets in the third quarter of 2004.

12/31/2005								PAGE 14A
Investment Management (excluding Assets Managed by
Delaware's London-based International Investment Unit)
Assets Under Management Rollforward
Unaudited [Billions of Dollars]
	Full Year
			2005			2004
Retail Fixed - Bal Beg-of-Period		$	8.257		$	8.186
Fund Sales			2.483			1.882
Redemptions			(1.476	)		(1.520	)
Net Money Market			(0.060	)		(0.113	)
Transfers			(0.082	)		(0.212	)
Net Flows			0.865			0.037
Market			0.079			0.290
Transfer of Assets Under Administration (1)			(0.001	)		(0.256	)
Balance end of period		$	9.199		$	8.257
Retail Equity - Bal Beg-of-Period		$	26.130		$	20.564
Fund Sales			11.573			7.105
Redemptions			(5.138	)		(4.024	)
Transfers			(0.203	)		0.042
Net Flows			6.233			3.123
Market			3.114			3.236
Transfer of Assets Under Administration (1)			(0.003	)		(0.793	)
Balance at end of period		$	35.474		$	26.130
Total Retail - Bal Beg-of-Period		$	34.387		$	28.750
Retail Sales-Annuities			2.957			2.752
Retail Sales-Mutual Funds			4.860			3.235
Retail Sales-Managed Acct. & Other			6.239			2.999
Total Retail Sales			14.056			8.987
Redemptions			(6.613	)		(5.544	)
Net Money Market			(0.060	)		(0.113	)
Transfers			(0.285	)		(0.170	)
Net Flows			7.098			3.160
Market			3.193			3.526
Transfer of Assets Under Administration (1)			(0.004	)		(1.049	)
Balance at end of period		$	44.673		$	34.387
Institutional Fixed - Bal Beg-of-Period		$	9.960		$	5.981
Inflows			4.277			4.356
Withdrawals/Terminations			(1.300	)		(0.452	)
Transfers			0.000			0.009
Net Flows			2.977			3.913
Market			0.104			0.067
Balance at end of period		$	13.042		$	9.960
Institutional Equity - Bal Beg-of-Period		$	11.682		$	10.318
Inflows			10.356			2.281
Withdrawals/Terminations			(4.520	)		(2.428	)
Transfers			0.048			0.118
Net Flows			5.884			(0.029	)
Market			1.813			1.393
Balance at end of period		$	19.379		$	11.682
Total Institutional - Bal Beg-of-Period		$	21.643		$	16.299
Inflows			14.633			6.637
Withdrawals/Terminations			(5.820	)		(2.880	)
Transfers			0.048			0.127
Net Flows			8.861			3.884
Market			1.917			1.459
Balance at end of period		$	32.420		$	21.643
Total Retail/Institutional - At end of period		$	77.093		$	56.029
Insurance-related Assets - At end of period		$	44.483		$	43.980
Total Retail/Inst - Net Flows		$	15.959		$	7.045
Total Assets Under Management
At end of period		$	121.576		$	100.009
Subadvised Assets, included in Assets Under Management above
Retail		$	17.162		$	10.740
Institutional			4.782			3.740
Total Subadvised Assets		$	21.945		$	14.480
(1) Retail assets under management include assets under administration related to the mutual fund-based 401(k) business. In the third quarter of 2004, this business was outsourced to Bisys. As a result, the third and fourth quarter of 2004 had net outflows of assets under administration of approximately $0.776 billion and $0.273 billion, respectively.
(2) This page presents the assets under management roll-forward without the Investment Management segment's London-based international investment unit, which was sold in the third quarter of 2004 and resulted in the transfer of assets under management of $22.1 billion.

12/31/2005										PAGE 15
Lincoln UK
Operational Data
Unaudited [Billions of Dollars]
	Fourth Quarter						Full Year
	2005			2004			2005			2004
Unit Linked Assets - Beg-of-Period	$	7.180		$	6.468		$	7.186		$	6.390
Deposits		0.156			0.108			0.389			0.378
Withdrawals (incl. chgs) & Deaths		(0.178	)		(0.188	)		(0.728	)		(0.712	)
Net Flows		(0.023	)		(0.080	)		(0.339	)		(0.335	)
Inv Inc & Chg in Mkt Val		0.347			0.411			1.243			0.648
Foreign Currency Adjustment		(0.184	)		0.387			(0.770	)		0.482
Unit Linked Assets - end of Period	$	7.320		$	7.186		$	7.320		$	7.186
Individual Life In-force	$	17.521		$	20.378		$	17.521		$	20.378
Exchange Rate - Dollars to Pounds
For-the-Period		1.747			1.875			1.821			1.834
End-of-Period		1.719			1.919			1.719			1.919

12/31/2005										PAGE 16
Other Operations
Unaudited [Millions of Dollars]
	Fourth Quarter						Full Year
For the Year Ended December 31	2005			2004			2005			2004
Operating Revenue by Source:
Lincoln Financial Advisors	$	136.2		$	103.9		$	514.0		$	383.6
Lincoln Financial Distributors		85.1			69.4			290.7			245.2
Total Distribution		221.3			173.2			804.7			628.8
Amortization of deferred gain on indemnity reinsurance*		18.9			19.1			75.7			87.0
Other [Including
Consolidating Adjustments]		(151.0	)		(111.3	)		(528.3	)		(380.7	)
Total Operating Revenue	$	89.2		$	81.1		$	352.1		$	335.1
Income (Loss) from Operations by Source:
Lincoln Financial Advisors	$	3.2		$	(0.3	)	$	(13.2	)	$	(17.8	)
Lincoln Financial Distributors		(3.5	)		(6.3	)		(22.8	)		(23.7	)
Total Distribution		(0.3	)		(6.6	)		(36.1	)		(41.5	)
Amortization of deferred gain on indemnity reinsurance*		12.3			12.4			49.2			56.5
LNC Financing		(14.4	)		(14.6	)		(57.6	)		(61.0	)
Other Corporate (1)		9.1			2.5			46.3			(11.3	)
Income (Loss) from Operations	$	6.7		$	(6.3	)	$	1.8		$	(57.2	)

* Represents the amortization of deferred gain recognized on the business sold through indemnity reinsurance to Swiss Re.

⁽¹⁾ Includes a reduction of the valuation allowance on the deferred tax asset of our foreign life reinsurance subsidiary of $4.3 million and $46.8 million in fourth quarter and full year 2005, respectively and $4.4 million in the fourth quarter of 2004.

12/31/2005										PAGE 17
Consolidated Investment Data
Unaudited [Millions of Dollars]
	Fourth Quarter						Full Year
For the Year Ended December 31	2005			2004			2005			2004
Net Investment Income
Fixed maturity AFS securities	$	509.7		$	514.8		$	2,030.5		$	2,005.7
Equity AFS securities		3.3			4.4			9.6			10.9
Trading securities		48.7			49.7			193.7			193.5
Mortgage loans on real estate		75.1			73.8			287.6			350.1
Real estate		5.6			5.4			50.1			26.9
Policy loans		29.2			31.3			118.4			119.8
Invested cash		19.2			17.9			63.0			32.2
Other investments		7.0			2.4			61.1			55.3
Investment revenue		697.9			699.8			2,813.9			2,794.4
Investment expense		(29.8	)		(25.7	)		(111.6	)		(90.3	)
Net Investment Income		668.1			674.1			2,702.3			2,704.1
Gross-up of Tax Exempt Income		2.1			2.6			7.1			7.7
Adjusted Net Investment Income	$	670.2		$	676.6		$	2,709.4		$	2,711.8
Mean Invested Assets (Amortized Cost)	$	44,035.2		$	43,763.4		$	43,933.3		$	43,216.4
Ratio of Adjusted Net Invest Income
Over Mean Invested Assets		6.09	%		6.18	%		6.17	%		6.27	%
Investment Gains (Losses)
Realized Gains (Losses) on Investments	$	(6.2	)	$	3.9		$	(14.5	)	$	(30.0	)
Gains(Losses) on Derivatives		0.1			0.3			(0.0	)		(7.4	)
Incr (Decr) in Unreal Gains on Sec
Avail-for-Sale (after DAC/Tax)		(72.4	)		42.8			(326.3	)		29.8
Incr (Decr) on Derivatives		(1.5	)		(5.8	)		(6.7	)		(8.1	)
Securities Available-for-Sale
[Billions of Dollars]
Fixed Maturity Sec (Fair Value)		36.687			37.936			36.687			37.936
Fixed Maturity Sec (Amortized Cost)		35.348			35.692			35.348			35.692
Equity Securities (Fair Value)		0.147			0.163			0.147			0.163
Equity Securities (Amortized Cost)		0.139			0.148			0.139			0.148
% of Fixed Maturity Securities (Based on Fair Value)
Treasuries and AAA		23.4	%		23.5	%		23.4	%		23.5	%
AA or better		30.9	%		29.9	%		30.9	%		29.9	%
BB or less		7.4	%		7.0	%		7.4	%		7.0	%