8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of

the Securities Exchange Act of 1934

                May 2, 2006                

Date of Report (Date of earliest event reported)

                  Lincoln National Corporation              

(Exact name of registrant as specified in its charter)

Indiana	1-6028	35-1140070
(State or other jurisdiction	(Commission	(IRS Employer
of incorporation)	File Number)	Identification No.)

1500 Market Street, West Tower, Suite 3900, Philadelphia, Pennsylvania 19102-2112

(Address of principal executive offices) (Zip Code)

(215) 448-1400

(Registrant’s telephone number, including area code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

[ ]	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
[ ]	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
[ ]	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
[ ]	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02. Results of Operations and Financial Condition.

On May 2, 2006, the registrant issued a press release announcing its financial results for the quarter ended March 31, 2006, a copy of which is attached as Exhibit 99.1 and is incorporated herein by reference, and the registrant’s statistical supplement for the quarter ended March 31, 2006 is attached as Exhibit 99.2 and is incorporated herein by reference.

The information, including exhibits attached hereto, furnished under this Item 2.02 shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that Section. The information in this Current Report shall not be incorporated by reference into any registration statement or other document pursuant to the Securities Act of 1933, as amended, except as otherwise expressly stated in such filing.

Item 9.01. Financial Statements and Exhibits

(c)   Exhibits.

The following exhibits are being furnished with this Form 8-K.

Exhibit Number	Description
99.1	Press release dated May 2, 2006, announcing Lincoln National Corporation’s financial results for the quarter ended March 31, 2006.
99.2	Lincoln National Corporation Statistical Supplement for the Quarter Ended March 31, 2006.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

LINCOLN NATIONAL CORPORATION
By	/s/ Douglas N. Miller
Name:	Douglas N. Miller
Title:	Vice President and
	Chief Accounting Officer

Date: May 2, 2006

EXHIBIT INDEX

Exhibit Number	Description
99.1	Press release dated May 2, 2006, announcing Lincoln National Corporation’s financial results for the quarter ended March 31, 2006.
99.2	Lincoln National Corporation Statistical Supplement for the Quarter Ended March 31, 2006.

EX-99.1

NEWS RELEASE

Lincoln Financial Group Reports First Quarter 2006 Earnings

Strong Organic Growth Characterizes Quarter

PHILADELPHIA, May 2, 2006 - Lincoln National Corporation (NYSE:LNC) today reported net income of $221.2 million, or $1.24 per diluted share for the first quarter of 2006. By comparison, net income for the first quarter of 2005 was $178.9 million, or $1.01 per diluted share.

Income from operations for the first quarter of 2006 was $221.8 million, or $1.25 per diluted share, compared with $172.5 million, or $0.98 per diluted share, in the first quarter of 2005. Return on equity (ROE), based on income from operations, for the quarter was 14.9%. The attached table defines and reconciles income from operations and ROE, non-GAAP measures, to net income and ROE calculated in accordance with GAAP.

Consolidated domestic retail deposits, which include annuities, mutual funds, life insurance and other personal wealth accumulation products, reached a record $7.0 billion, up 12% over the first quarter of 2005. Lincoln reported consolidated retail net flows for the quarter of $2.7 billion, up 3% from the prior year quarter. Institutional deposits were $4.8 billion for the quarter with $3.6 billion in net flows, both up over 150% from the 2005 quarter. Consolidated assets under management grew to $183 billion.

“Despite a crowded field of competitors in the retirement and asset management marketplace, Lincoln continued to capture marketshare through industry-leading products, top-tier investment management performance, and wholesaling excellence,” said Jon A. Boscia, chairman and chief executive officer of Lincoln Financial Group.

Lincoln Retirement

First quarter income from operations for the Lincoln Retirement segment was $123.1 million versus $98.6 million for the same period a year ago. The current quarter’s

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results were driven by a 17% increase in account value versus the prior year period and contained approximately $9 million, after tax, of favorable items, primarily related to higher than expected investment income and hedge performance.

In the quarter, record variable annuity deposits of $2.4 billion fueled record gross deposits and net flows of $2.9 billion and $858 million, respectively. The company’s multi-manager variable annuity, Lincoln Choice Plus^SM, posted a 38% increase in deposits over the first quarter of 2005, while Lincoln’s single-manager variable annuity, American Legacy^®, increased 17%, as both achieved record sales in the current quarter.

“Consecutive quarters of strong deposits and net flows lifted account values and related revenues, which were also aided by favorable equity markets and outperformance in our variable annuities’ sub-accounts, relative to the S&P 500 index” said Boscia.

Life Insurance

Life Insurance income from operations was $82.2 million, compared to $67.7 million in the first quarter of 2005. The 2006 quarter benefited from approximately $3 million of net positive items, including favorable mortality and better than expected investment income. The prior year quarter was impacted by approximately $4 million, after tax, of unfavorable mortality and negative unlocking of deferred acquisition costs (DAC).

First year premiums from retail life insurance increased 14% in the quarter as compared to the prior year quarter, driven by strong universal life sales. Premiums in the 2005 quarter were negatively impacted by competitive market conditions and Lincoln’s proactive stance against participating in the sale of investor-owned life insurance products.

“Lincoln’s differentiated and expanded wholesaling model continued to gain traction. As an example, life sales in the wirehouse channel were up 31% over the first quarter of 2005,” said Boscia.

Investment Management

Investment Management reported income from operations of $20.3 million for the quarter, compared with $7.4 million for the same period a year ago. In the current quarter, earnings benefited from a 43% increase in third-party advisory fee revenue over the first quarter of 2005 and, together with enhanced expense management, contributed to margin expansion.

Strength in both the retail and institutional businesses over the quarter boosted total deposits to $8.6 billion and net flows to $5.0 billion. Retail deposits were $3.8 billion, marking five consecutive quarters of retail deposits in excess of $3 billion.

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“With most of Delaware’s recent talent-related expenses behind them and as third-party assets under management grew almost 50% over the prior year period, the segment's earnings potential was evident this quarter,” said Boscia.

Lincoln UK

For the first quarter, the UK segment’s income from operations was $10.7 million, which compares with $10.0 million in the first quarter of 2005. Current quarter results reflect the positive impact of equity markets, as the FTSE 100 index ended the quarter up 22% compared to a year ago, offsetting the natural run-off in the block of business.

Corporate and Other

Corporate and Other recorded an operating loss for the first quarter of $14.5 million, versus $11.2 million in the first quarter of 2005. Distribution losses were $9.8 million in the first quarter of 2006 versus $13.6 million a year ago, benefiting from increased operating efficiency. In the 2006 quarter, the Corporate and Other results benefited from approximately $3 million of favorable expense-related items. The first quarter of 2005 included a positive $5.8 million adjustment from a reduction in the deferred tax asset valuation allowance previously established in the company’s Barbados subsidiary.

Capital and Share Repurchase

     As of March 31, 2006, the book value of Lincoln National Corporation common stock, excluding accumulated other comprehensive income, was $34.37, compared with $30.85 a year ago. Book value, including accumulated other comprehensive income, was $35.99, compared with $34.74 a year ago. Although Lincoln did not repurchase shares in the first quarter of 2006, the company entered into an accelerated share repurchase program on April 3, 2006, and as a result, retired approximately 8 million shares on April 10, 2006. The program is expected to be completed in the third quarter of 2006 and the total number of shares repurchased will be between approximately 8 and 9 million.

Lincoln Financial Group and Jefferson Pilot Financial Merger

Lincoln and Jefferson Pilot completed the merger on April 3, 2006. Upon closing, Lincoln issued approximately 112 million shares of common stock and funded the $1.8 billion in cash through its bridge loan facility. Since the close of the merger, Lincoln has raised $1 billion in senior debt and $275 million in capital securities to refinance a majority of the funds borrowed under its bridge loan facility.

“A central pillar of our integration plan is to minimize distractions in product delivery, customer service, and product platforms, setting the stage for revenue synergies and organic growth,” said Boscia. “The resilient results in the first quarter are evidence that we are on track.”

Dennis Glass, president and chief operating officer for Lincoln, added, “As we move from integrating operations to executing on a single platform, I am excited about our ability to drive growth and shareholder returns through our combined product portfolio and enhanced distribution platform. I look forward to carrying this quarter’s strong results into our first quarter as a unified company.”

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Lincoln National Corporation will discuss the company’s first quarter results with investors in a conference call beginning at 11:00 a.m. (ET) on Wednesday, May 3, 2006. The company will also post its first quarter 2006 statistical supplement on its Web site, www.LFG.com. Included as an addendum to Lincoln’s statistical supplement, a summary of Jefferson Pilot’s first quarter 2006 financial results will be posted on www.LFG.com.

Lincoln Financial Group is the marketing name for Lincoln National Corporation (NYSE:LNC) and its affiliates. With headquarters in Philadelphia, Lincoln Financial Group had consolidated assets of $128 billion as of March 31, 2006, and had annual consolidated revenues of $5.5 billion in 2005. As of April 3, 2006, the company offers: annuities; life, group life and disability insurance; 401(k) and 403(b) plans; savings plans; mutual funds; managed accounts; institutional investments; and comprehensive financial planning and advisory services. Company affiliates include: Lincoln Financial Distributors, which provides wholesaling and marketing support; Lincoln Financial Advisors, a national network of financial planners, agents, and registered representatives; Delaware Investments, the marketing name for Delaware Management Holdings, Inc. and its subsidiaries; Lincoln Financial Media, which owns and operates three television stations, 18 radio stations, and the Lincoln Financial Sports production and syndication business; and Lincoln UK. For more information please visit www.LFG.com.

Contacts:	Jim Sjoreen	Laurel O’Brien
	215 448-1420	215 255-1520
	Investor Relations	Media Relations
	investorrelations@LFG.com	mediarelations@LFG.com

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Definition of Income (Loss) from Operations and ROE

Income (loss) from operations and ROE, as used in the earnings release, are non-GAAP financial measures and are not substitutes for net income (loss) and ROE, calculated using GAAP measures. Income (loss) from operations represents after tax results excluding, as applicable, realized gains or losses on investments and derivatives, cumulative effect of accounting changes, restructuring charges, reserve changes on business sold through reinsurance, gain on sale of subsidiaries and book of business and loss on early retirement of debt. The earnings used to calculate ROE, as used in the earnings release, are income (loss) from operations. Income (loss) from operations is an internal measure used by the company in the management of its operations. Management believes that this performance measure explains the results of the company's ongoing operations in a manner that allows for a better understanding of the underlying trends in the company's current business because the excluded items are either unpredictable and/or not related to decisions regarding the underlying businesses.

	For the Quarter
($ in millions, except per share data)	Ended March 31,
	2006			2005
Net Income	$	221.2		$	178.9
Less:
Net realized loss on investments		(4.4	)		(4.6	)
Restructuring charges		(0.2	)		(1.3	)
Net gain on reinsurance
derivative/trading account securities		3.8			2.8
Reserve development and related amortization
on business sold through reinsurance		0.2			0.2
Gain on sale of subsidiaries/ businesses		__			9.3
Income from Operations	$	221.8		$	172.5
Earnings per share (diluted)
Net Income	$	1.24		$	1.01
Income from Operations	$	1.25		$	0.98
Average Equity
(Excluding accumulated other comprehensive income)	$	5,954.9		$	5,338.8
Return on Equity
Net Income		14.9	%		13.4	%
Income from Operations		14.9	%		12.9	%

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LINCOLN NATIONAL CORPORATION

DIGEST OF EARNINGS

	For the Quarter Ended March 31
	2006		2005
Revenue	$	1,417,009,388	$	1,313,239,197
Net Income	$	221,225,418	$	178,935,777
EPS - Basic	$	1.27	$	1.03
EPS - Diluted	$	1.24	$	1.01
Avg. Shares - Basic		174,577,421		173,695,598
Avg. Shares - Diluted		177,929,653		176,628,890

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Forward-Looking Statements—Cautionary Language

Certain statements made in this report and in other written or oral statements made by Lincoln or on Lincoln’s behalf are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 (“PSLRA”). A forward-looking statement is a statement that is not a historical fact and, without limitation, includes any statement that may predict, forecast, indicate or imply future results, performance or achievements, and may contain words like: “believe”, “anticipate”, “expect”, “estimate”, “project”, “will”, “shall” and other words or phrases with similar meaning in connection with a discussion of future operating or financial performance. In particular, these include statements relating to future actions, prospective services or products, future performance or results of current and anticipated services or products, sales efforts, expenses, the outcome of contingencies such as legal proceedings, operations, trends or financial results. Lincoln claims the protection afforded by the safe harbor for forward-looking statements provided by the PSLRA.

Forward-looking statements involve risks and uncertainties that may cause actual results to differ materially from the results contained in the forward-looking statements. Risks and uncertainties that may cause actual results to vary materially, some of which are described within the forward-looking statements include, among others:

·       Problems arising with the ability to successfully integrate our and Jefferson-Pilot Corporation’s businesses, which may affect our ability to operate as effectively and efficiently as expected or to achieve the expected synergies from the merger or to achieve such synergies within our expected timeframe;

· Legislative, regulatory or tax changes, both domestic and foreign, that affect the cost of, or demand for, Lincoln’s products, the required amount of reserves and/or surplus, or otherwise affect our ability to conduct business, including changes to statutory reserves and/or risk-based capital requirements related to secondary guarantees under universal life and variable annuity products such as Actuarial Guideline 38; restrictions on revenue sharing and 12b-1 payments; and the potential for U.S. Federal tax reform;

· The initiation of legal or regulatory proceedings against Lincoln or its subsidiaries and the outcome of any legal or regulatory proceedings, such as: (a) adverse actions related to present or past business practices common in businesses in which Lincoln and its subsidiaries compete; (b) adverse decisions in significant actions including, but not limited to, actions brought by federal and state authorities, and extra-contractual and class action damage cases; (c) new decisions that result in changes in law; and (d) unexpected trial court rulings;

· Changes in interest rates causing a reduction of investment income, the margins of Lincoln’s fixed annuity and life insurance businesses and demand for Lincoln’s products;

· A decline in the equity markets causing a reduction in the sales of Lincoln’s products, a reduction of asset fees that Lincoln charges on various investment and insurance products, an acceleration of amortization of deferred acquisition costs, the value of business acquired, deferred sales inducements and deferred front-end loads and an increase in liabilities related to guaranteed benefit features of Lincoln’s variable annuity products;

· Ineffectiveness of Lincoln’s various hedging strategies used to offset the impact of declines in the equity markets;

· A deviation in actual experience regarding future persistency, mortality, morbidity, interest rates or equity market returns from Lincoln’s assumptions used in pricing its products, in establishing related insurance reserves, and in the amortization of intangibles that may result in an increase in reserves and a decrease in net income;

· Changes in accounting principles generally accepted in the United States (“GAAP”) that may result in unanticipated changes to Lincoln’s net income;

· Lowering of one or more of Lincoln’s debt ratings issued by nationally recognized statistical rating organizations, and the adverse impact such action may have on Lincoln’s ability to raise capital and on its liquidity and financial condition;

· Lowering of one or more of the insurer financial strength ratings of Lincoln’s insurance subsidiaries, and the adverse impact such action may have on the premium writings, policy retention, and profitability of its insurance subsidiaries;

· Significant credit, accounting, fraud or corporate governance issues that may adversely affect the value of certain investments in the portfolios of Lincoln’s companies requiring that Lincoln realize losses on such investments;

· The impact of acquisitions and divestitures, restructurings, product withdrawals and other unusual items, including Lincoln’s ability to integrate acquisitions and to obtain the anticipated results and synergies from acquisitions;

· The adequacy and collectibility of reinsurance that Lincoln has purchased;

· Acts of terrorism or war that may adversely affect Lincoln’s businesses and the cost and availability of reinsurance;

· Competitive conditions, including pricing pressures, new product offerings and the emergence of new competitors, that may affect the level of premiums and fees that Lincoln can charge for its products;

· The unknown impact on Lincoln’s business resulting from changes in the demographics of Lincoln’s client base, as aging baby-boomers move from the asset-accumulation stage to the asset-distribution stage of life;

· Loss of key management, portfolio managers in the Investment Management segment, financial planners or wholesalers; and

· Changes in general economic or business conditions, both domestic and foreign, that may be less favorable than expected and may affect foreign exchange rates, premium levels, claims experience, the level of pension benefit costs and funding, and investment results.

The risks included here are not exhaustive. Other sections of this report and Lincoln’s annual reports on Form 10-K, current reports on Form 8-K and other documents filed with the SEC include additional factors which could impact Lincoln’s business and financial performance. Moreover, Lincoln operates in a rapidly changing and competitive environment. New risk factors emerge from time to time and it is not possible for management to predict all such risk factors.

Further, it is not possible to assess the impact of all risk factors on Lincoln’s business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. Given these risks and uncertainties, investors should not place undo reliance on forward-looking statements as a prediction of actual results. In addition, Lincoln disclaims any obligation to update any forward-looking statements to reflect events or circumstances that occur after the date of this report.

 

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EX-99.2

This document is dated May 2, 2006. It may not be accurate after such date and LNC does not undertake to update or keep it accurate after such date.

Lincoln Financial Group
Statistical Report
First Quarter
2006
Table of Contents
Notes
Financial Highlights	1 - 6
Ten-Year Summary	7
Quarterly Summary	8
Consolidated Statements of Income	9 - 10
Consolidating Statements of Income from Operations	11 - 12
Five-Year Comparative Balance Sheet	13
Quarterly Balance Sheet	14
Consolidating Balance Sheets	15 - 16
Lincoln Retirement
Income Statement & Operational Data	17 - 18
Account Value Roll Forward	19 - 20
Annuity Account Values	21 - 22
Life Insurance
Income Statements	23 - 24
Operational Data	25
Account Value Roll Forward	26 - 27
Investment Management
Income Statements	28 - 29
Assets Under Management Roll Forward	30 - 31
Lincoln UK
Income Statements	32 - 33
Operational Data	34
Other Operations	35
Restructuring Charges	36
Consolidated
Domestic Retail Deposits / Account Balances	37
Total Domestic Net Flows	37
Assets Managed	38
Investment Data	39
Common Stock / Debt Information	40
Jefferson-Pilot Data
Financial Highlights	41
Performance Measures	42
Consolidated Condensed Statements of Income	43
Quarterly Consolidated Statements of Income	44
Consolidated Balance Sheets	45
Quarterly Consolidated Balance Sheets	46

3/31/2006			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, 30A, 31A, 37A, 38A) have been presented excluding the investment assets managed by the London-based international investment unit to provide more consistent comparisons between periods.
*	Value of business acquired on the balance sheet was referred to as present value of in-force in our previous statistical supplements.
*	Certain reclassifications have been made to the prior periods presented to conform to the December 31, 2005 presentation.
Subsequent Events
On April 3, 2006, we completed our merger with Jefferson-Pilot Corporation (“Jefferson-Pilot”). Jefferson-Pilot’s results of operations will be included in our results of operations beginning with the second quarter of 2006. As a result of the merger, we offer fixed and variable universal life, fixed and equity indexed annuities, variable annuities, 401(k) and 403(b) offerings, and group life, disability and dental insurance products. We also operate television and radio stations.
We paid $1.8 billion in cash and issued approximately 112 million shares of our common stock to the former holders of Jefferson-Pilot common stock in connection with the merger. The purchase price is estimated to be $7.5 billion, and the estimated fair value of Jefferson-Pilot’s net assets is assumed to be $4.3 billion.
We financed the cash portion of the merger consideration by borrowing $1.8 billion under the credit agreement that we entered into with a group of banks in December 2005 (the “Bridge Facility”). In April 2006, we issued $500 million of Floating Rate Senior Notes due April 2009, $500 million of 6.15% Senior Notes due April 2036 and $275 million of our 6.75% junior subordinated debentures due 2066. We used the net proceeds of approximately $1.3 billion to repay a portion of the borrowings under the Bridge Facility.
On April 3, 2006, we entered into an agreement to purchase a variable number of shares of our common stock from a third party broker-dealer, using an accelerated stock buyback program for an aggregate purchase price of $500 million. The number of shares to be repurchased under this arrangement will be between approximately 8 million but not more than approximately 9 million shares, based on the volume weighted average share price of our common stock over the program’s duration.
Certain financial information of Jefferson-Pilot for the three month periods ended March 31, 2006 and 2005 has been included on pages 41 through 46 of this statistical supplement.

3/31/2006										PAGE 1
Financial Highlights
Unaudited [Millions of Dollars, except Common Share Data]
	For the Quarter Ended March 31
	2006			2005
	Amount			Amount			Change			% Change
Income from Operations - By Segment
Lincoln Retirement	$	123.1		$	98.6		$	24.5			24.8	%
Life Insurance		82.2			67.7			14.5			21.4	%
Investment Management		20.3			7.4			12.9			174.9	%
Lincoln UK		10.7			10.0			0.7			7.0	%
Corporate & Other		(14.6	)		(11.3	)		(3.3	)		-29.2	%
Total Income from Operations		221.8			172.5			49.3			28.6	%
Realized losses on investments and derivatives		(4.4	)		(4.6	)		0.2			4.2	%
Net gain on reinsurance
derivative/trading account securities		3.8			2.8			1.0			33.4	%
Gain on sale of subsidiaries/ businesses		-			9.3			(9.3	)		-100.0	%
Reserve development/ amortization of related deferred gain		0.2			0.2			-			-
Restructuring charges		(0.2	)		(1.3	)		1.1			83.7	%
Net Income	$	221.2		$	178.9		$	42.3			23.6	%
Earnings per share (diluted)
Income from Operations	$	1.25		$	0.98		$	0.27			27.7	%
Realized losses on investments and derivatives		(0.03	)		(0.03	)		-
Net gain on reinsurance
derivative/trading account securities		0.02			0.02			-
Gain on sale of subsidiaries/ businesses		-			0.05			(0.05	)		-100.0	%
Restructuring charges		-			(0.01	)		0.01			100.0	%
Net Income	$	1.24		$	1.01		$	0.23			22.8	%
Operating Revenue- By Segment
Lincoln Retirement	$	586.7		$	538.5		$	48.1			8.9	%
Life Insurance		515.0			484.2			30.9			6.4	%
Investment Management		162.6			130.4			32.3			24.8	%
Lincoln UK		69.5			74.6			(5.2	)		-6.9	%
Corporate & Other		83.9			73.8			10.1			13.7	%
Total Operating Revenue		1,417.8			1,301.5			116.2			8.9	%
Realized losses on investments		(10.5	)		(8.7	)		(1.8	)		-20.1	%
Gains on derivatives		3.5			1.5			2.1			138.2	%
Gain on reinsurance derivative/trading
account securities		5.9			4.4			1.5			33.9	%
Gain on sale of subsidiaries/ businesses		-			14.2			(14.2	)		-100.0	%
Amortization of deferred gain-reserve development		0.3			0.3			-			-
Total Revenue	$	1,417.0		$	1,313.2		$	103.8			7.9	%

3/31/2006								PAGE 2
Financial Highlights
Unaudited [Billions of Dollars]
Operational Data by Segment	For the Quarter Ended March 31
	2006		2005
	Amount		Amount		Change			% Change
Lincoln Retirement
Gross Deposits	$	2.888	$	2.639	$	0.249			9.4	%
Net Flows		0.858		0.776		0.082			10.6	%
Account Values (Gross)		75.902		65.048		10.854			16.7	%
Account Values (Net of Reinsurance)		73.700		62.757		10.943			17.4	%
Life Insurance Segment
First Year Premium- Retail (in millions)	$	203.711	$	179.344	$	24.366			13.6	%
First Year Premium- COLI (in millions)		19.649		24.804		(5.155	)		-20.8	%
First Year Premium- Total (in millions)		223.360		204.148		19.211			9.4	%
In-force		329.388		308.976		20.411			6.6	%
Account Values		15.655		14.466		1.189			8.2	%
Investment Management Segment
Retail Deposits	$	3.781	$	3.381	$	0.400			11.8	%
Retail Net Flows		1.452		1.579		(0.126	)		-8.0	%
Institutional In-flows		4.783		1.787		2.996			167.7	%
Institutional Net Flows		3.551		1.217		2.334			191.8	%
Total Deposits and In-flows		8.564		5.168		3.396			65.7	%
Total Net Flows		5.004		2.796		2.208			79.0	%
Assets Under Management- Retail and Inst'l		86.021		58.022		28.000			48.3	%
Assets Under Management - Insurance-related Assets		43.430		44.210		(0.779	)		-1.8	%
Assets Under Management - Total Segment		129.452		102.231		27.220			26.6	%
Consolidated
Domestic Retail Deposits	$	6.990	$	6.249	$	0.740			11.8	%
Domestic Retail Account Balances		129.328		104.936		24.392			23.2	%
Domestic Retail Net Flows		2.664		2.593		0.071			2.7	%
Domestic Deposits		11.740		8.021		3.719			46.4	%
Domestic Net Flows		6.241		3.851		2.390			62.1	%
Assets Under Management		182.959		145.487		37.472			25.8	%

3/31/2006										PAGE 3
Financial Highlights
Unaudited [Millions of Dollars, except Common Share Data]
	For the Quarter Ended March 31
	2006			2005
	Amount			Amount			Change			% Change
Balance Sheet Assets - End of Period	$	128,393.9		$	116,352.2		$	12,041.7			10.3	%
Shareholders' Equity
Beg of Period (including AOCI)	$	6,384.4		$	6,175.6		$	208.8
End of Period (including AOCI)		6,338.2			6,042.9			295.2
End of Period (excluding AOCI)		6,053.2			5,365.8			687.4
Average Equity (excluding AOCI)		5,954.9			5,338.8			616.1
Return on Equity
Net Income/Average Equity (excluding AOCI)		14.9	%		13.4	%		1.5	%
Inc from Operations/Average Equity (excluding AOCI)		14.9	%		12.9	%		2.0	%
Return on Capital
Inc from Operations/Average Capital		12.9	%		10.8	%		2.1	%
Common Stock Outstanding
Average for the Period - Diluted		177.9			176.6			1.3			0.7	%
End of Period - Assuming Conv of Pref.		176.1			173.9			2.2			1.3	%
End of Period - Diluted		178.5			176.5			1.9			1.1	%
Book Value (including AOCI)	$	35.99		$	34.74		$	1.25			3.6	%
Book Value (excluding AOCI)	$	34.37		$	30.85		$	3.52			11.4	%
Cash Returned to Shareholders
Share Repurchase - dollar amount	$	-			34.6			(34.6	)
Dividends Declared to Shareholders		67.5			63.7			3.7
Total Cash Returned to Shareholders	$	67.5		$	98.4		$	(30.9	)
Share Repurchase - number of shares		-			0.755			(0.755	)
Dividend Declared on Common Stock - per share	$	0.380		$	0.365		$	0.015			4.1	%
		For the Quarter Ended March 31
		2006			2005
		Amount			Amount
Comprehensive Income (Loss)
Net Income	$	221.2		$	178.9
Foreign Currency Translation		6.3			(7.8	)
Net Unrealized Losses on Securities		(276.4	)		(240.0	)
Gains (Losses) on Derivatives		27.8			(6.3	)
Minimum Pension Liability Adjustment		(0.6	)		0.6
Comprehensive Loss	$	(21.6	)	$	(74.6	)

3/31/2006										PAGE 4
Financial Highlights
Unaudited [Millions of Dollars]
	For the Quarter Ended March 31
	2006			2005
	Amount			Amount			Change			% Change
Condensed Consolidated Statements of Income
Revenue:
Insurance Premiums and Fees	$	554.1		$	489.4		$	64.7			13.2	%
Investment Advisory Fees		84.9			59.4			25.5			43.0	%
Net Investment Income		678.3			659.8			18.5			2.8	%
Realized Losses on Investments		(10.5	)		(8.7	)		(1.8	)		-20.1	%
Gains on Derivatives		3.5			1.5			2.1			138.2	%
Gain on Reinsurance Derivative/Trading
Account Securities		5.9			4.4			1.5			34.7	%
Gain on Sale of Subsidiaries/ Businesses		-			14.2			(14.2	)		-100.0	%
Amortization of Deferred Gain on
Indemnity Reinsurance		19.1			19.3			(0.2	)		-0.9	%
Other Revenue		81.6			74.0			7.6			10.2	%
Total Revenue		1,417.0			1,313.2			103.8			7.9	%
Benefits and Expenses:
Benefits		584.4			572.6			11.7			2.0	%
Underwriting, Acquisition,
Insurance and Other Expenses		517.8			502.8			15.0			3.0	%
Total Benefits and Expenses		1,102.1			1,075.4			26.7			2.5	%
Income before Federal Taxes		314.9			237.8			77.1			32.4	%
Federal Income Taxes		93.6			58.9			34.8			59.1	%
Net Income	$	221.2		$	178.9		$	42.3			23.6	%

3/31/2006										PAGE 5
Financial Highlights
Unaudited [Millions of Dollars]
	As of
	March			December
	2006			2005
	Amount			Amount			Change			% Change
Condensed Consolidated Balance Sheets
Assets:
Investments:
Available for Sale Securities:
Fixed Maturities	$	32,892.8		$	33,443.2		$	(550.4	)		-1.6	%
Equities		176.0			144.7			31.3			21.6	%
Trading Securities		3,190.1			3,246.0			(56.0	)		-1.7	%
Mortgage Loans on Real Estate		3,586.2			3,662.6			(76.5	)		-2.1	%
Real Estate		180.4			182.7			(2.3	)		-1.3	%
Policy Loans		1,860.4			1,862.2			(1.9	)		-0.1	%
Other Long-Term Investments		687.5			626.9			60.6			9.7	%
Total Investments		42,573.2			43,168.4			(595.2	)		-1.4	%
Deferred Acquisition Costs		4,371.2			4,092.2			279.0			6.8	%
Value of Business Acquired		984.4			998.9			(14.5	)		-1.5	%
Goodwill		1,194.4			1,194.2			0.1			0.0	%
Other Assets		11,286.5			11,586.9			(300.4	)		-2.6	%
Assets Held in Separate Accounts		67,984.2			63,746.8			4,237.4			6.6	%
Total Assets	$	128,393.9		$	124,787.6		$	3,606.3			2.9	%
Liabilities and Shareholders' Equity
Liabilities:
Insurance and Investment Contract Liabilities	$	47,000.5		$	47,222.8		$	(222.3	)		-0.5	%
Other Liabilities		7,071.0			7,433.6			(362.6	)		-4.9	%
Liabilities Related to Separate Accounts		67,984.2			63,746.8			4,237.4			6.6	%
Total Liabilities		122,055.7			118,403.2			3,652.5			3.1	%
Shareholders' Equity:
Net Unrealized Gains on Securities
and Derivatives		255.4			503.9			(248.5	)		-49.3	%
Minimum Pension Liability Adjustment		(60.1	)		(59.5	)		(0.6	)		-0.9	%
Foreign Currency Translation Adjustment		89.7			83.4			6.3			7.5	%
Other Shareholders' Equity		6,053.2			5,856.6			196.6			3.4	%
Total Shareholders' Equity		6,338.2			6,384.4			(46.2	)		-0.7	%
Total Liabilities and Shareholders' Equity	$	128,393.9		$	124,787.6		$	3,606.3			2.9	%

3/31/2006										PAGE 6
Financial Highlights
Unaudited [Millions of Dollars]
	For the Three Months Ended March 31
	2006			2005
	Amount			Amount			Change			% Change
Roll Forward of Deferred Acquisition Costs
Balance at beginning of period	$	4,092.2		$	3,445.0		$	647.3			18.8	%
Deferral		235.1			203.5			31.6			15.5	%
Amortization		(144.5	)		(132.8	)		(11.7	)		8.8	%
Included in Total Benefits and Expenses		90.6			70.7			20.0			28.2	%
Adjustment related to realized (gains) losses
on available-for-sale securities		(10.9	)		(11.7	)		0.8			6.9	%
Adjustment related to unrealized (gains) losses
on available-for-sale securities		194.2			215.7			(21.5	)		-10.0	%
Foreign currency translation adjustment		5.1			(7.0	)		12.0			NM
Balance at end of period	$	4,371.2		$	3,712.7		$	658.5			17.7	%
Roll Forward of Value of Business Acquired
Balance at beginning of period	$	998.9		$	1,095.2		$	(96.3	)		-8.8	%
Amortization		(17.2	)		(18.9	)		1.7			-9.2	%
Foreign currency translation adjustment		2.7			(3.3	)		5.9			NM
Balance at end of period	$	984.4		$	1,073.1		$	(88.6	)		-8.3	%
Roll Forward of Deferred Front-End Load*
Balance at beginning of period	$	723.6		$	764.1		$	(40.5	)		-5.3	%
Deferral		21.7			22.6			(0.8	)		-3.7	%
Amortization		(21.4	)		(25.2	)		3.8			-15.1	%
Included in Income from Operations		0.3			(2.7	)		3.0			110.9	%
Foreign currency translation adjustment		3.8			(5.2	)		8.9			NM
Balance at end of period	$	727.7		$	756.2		$	(28.6	)		-3.8	%
* Included in Insurance and Investment Contract Liabilities on the Balance Sheet

3/31/2006																												PAGE 7
Ten-Year Summary
Unaudited [Millions of Dollars, except Common Share Data]
For the Year Ended December 31	2005			2004			2003			2002			2001			2000			1999			1998			1997			1996
Operating Revenue
Lincoln Retirement	$	2,258.0		$	2,128.0		$	1,985.1		$	1,985.5		$	2,033.1		$	2,138.9		$	2,128.0		$	2,050.6		$	1,959.5		$	1,759.5
Life Insurance		1,993.5			1,952.9			1,906.1			1,881.7			1,897.5			1,836.4			1,762.6			1,379.5			541.5			527.6
Investment Management		567.8			534.9			474.0			418.5			454.9			517.6			515.0			508.7			447.5			400.6
Lincoln UK		318.4			342.2			274.5			275.4			278.2			430.6			443.6			438.6			425.2			393.3
Corporate & Other		352.1			335.1			284.2			355.0			1,815.9			1,951.9			1,951.6			1,690.6			1,402.2			1,560.0
Total Operating Revenue		5,489.8			5,293.2			4,923.9			4,916.1			6,479.6			6,875.4			6,800.7			6,068.0			4,775.9			4,641.1
Realized gains (losses) on investments
and derivatives		(23.3	)		(61.3	)		(19.8	)		(271.5	)		(114.5	)		(28.3	)		3.0			19.0			122.6			92.5
Net gain on reinsurance derivative/trading
account securities		5.9			3.1			4.7			-			-			-			-			-			-			-
Gain (loss) on sale of subsidiaries/ businesses		14.2			135.0			-			(8.3	)		12.8			-			-			-			-			-
Mark to market adjustment on reclassification
from AFS to trading account securities		-			-			371.5			-			-			-			-			-			-			-
Amortization of deferred gain-reserve development		1.3			1.3			3.6			(0.8	)		-			-			-			-			-			-
Total Revenue	$	5,487.9		$	5,371.3		$	5,283.9		$	4,635.5		$	6,378.0		$	6,847.1		$	6,803.7		$	6,087.1		$	4,898.5		$	4,733.6
Income from Operations
Lincoln Retirement	$	471.5		$	414.6		$	331.9		$	183.4		$	316.2		$	358.1		$	299.4		$	262.4		$	223.0		$	174.6
Life Insurance		298.9			280.3			264.5			269.0			275.3			256.7			212.0			149.2			39.9			41.2
Investment Management		36.0			43.6			34.5			1.8			(6.1	)		25.0			61.0			43.9			18.1			18.6
Lincoln UK		43.4			43.5			43.6			34.6			58.1			59.2			(13.9	)		70.9			(108.3	)		66.0
Corporate & Other		1.8			(57.2	)		(81.8	)		(57.2	)		1.0			(16.0	)		(83.1	)		4.0			(223.3	)		(1.7	)
Operating Income from Cont Oper		851.6			724.8			592.8			431.6			644.4			683.0			475.5			530.4			(50.6	)		298.8
Discontinued Operations		-			-			-			-			-			-			-			-			110.1			135.3
Income from Operations		851.6			724.8			592.8			431.6			644.4			683.0			475.5			530.4			59.4			434.1
Realized gains (losses) on investments and derivatives		(14.5	)		(37.4	)		(12.6	)		(176.4	)		(73.5	)		(17.5	)		3.8			13.7			72.9			57.6
Net gain (loss) on reinsurance
derivative/trading account securities		3.0			(0.6	)		2.7			-			-			-			-			-			-			-
Gain (loss) on sale of subsidiaries/ businesses		9.3			61.9			-			(9.4	)		15.0			-			-			-			-			-
Mark to market adjustment on reclassification
from AFS to trading account securities		-			-			241.5			-			-			-			-			-			-			-
Restructuring charges		(19.1	)		(13.9	)		(35.0	)		2.0			(24.7	)		(80.2	)		(18.9	)		(34.3	)		-			-
Loss on early retirement of subordinated debt		-			(4.1	)		(3.7	)		-			-			-			-			-			-			-
Reserve development/ amortization of related
deferred gain		0.9			0.9			(18.5	)		(199.1	)		-			-			-			-			-			-
Cumulative effect of accounting change		-			(24.5	)		(255.2	)		-			(15.6	)		-			-
Discontinued operations included in
income from operations		-			-			-			-			-			-			-			-			(110.1	)		(135.3	)
Income from Continuing Operations		831.1			707.0			511.9			48.8			545.7			585.3			460.4			509.8			22.2			356.4
Discontinued Operations included
in Income from Operations		-			-			-			-			-			-			-			-			911.8			157.2
Net Income	$	831.1		$	707.0		$	511.9		$	48.8		$	545.7		$	585.3		$	460.4		$	509.8		$	934.0		$	513.6
OTHER DATA
Assets	$	124,787.6		$	116,219.3		$	106,744.9		$	93,184.6		$	98,041.6		$	99,870.6		$	103,095.7		$	93,836.3		$	77,174.7		$	71,713.4
Shareholders' Equity
Including AOCI	$	6,384.4		$	6,175.6		$	5,811.6		$	5,347.5		$	5,303.8		$	4,980.6		$	4,263.9		$	5,387.9		$	4,982.9		$	4,470.0
Excluding AOCI		5,856.6			5,244.9			4,942.6			4,612.9			5,130.6			4,946.6			4,699.5			4,785.5			4,500.7			3,990.6
Average Equity (excluding AOCI)		5,512.2			5,075.5			4,756.7			4,983.3			5,057.1			4,831.4			4,786.2			4,636.3			4,172.7			3,851.7
Common Shares Outstanding (millions)
End of Period - Diluted		176.9			176.1			180.7			178.5			189.3			193.2			197.0			203.4			204.7			209.5
Average for the Period - Diluted		176.1			179.0			179.4			184.6			191.5			193.0			200.4			203.3			208.0			208.0
Per Share Data (Diluted)
Net Income from Continuing Operations	$	4.72		$	3.95		$	2.85		$	0.26		$	2.85		$	3.03		$	2.30		$	2.51		$	0.11		$	1.71
Net Income		4.72			3.95			2.85			0.26			2.85			3.03			2.30			2.51			4.49			2.47
Income (Loss) from Continuing Operations		4.83			4.05			3.30			2.34			3.37			3.54			2.37			2.61			(0.24	)		1.44
Income from Operations		4.83			4.05			3.30			2.34			3.37			3.54			2.37			2.61			0.29			2.09
Shareholders' Equity Per Share
Shareholders' Equity (Including AOCI)	$	36.69		$	35.53		$	32.56		$	30.10		$	28.32		$	26.05		$	21.76		$	26.59		$	24.63		$	21.50
Shareholders' Equity (Excluding AOCI)		33.66			30.17			27.69			25.97			27.39			25.88			23.98			23.62			22.25			19.19
Dividends Declared (Common Stock)		1.475			1.415			1.355			1.295			1.235			1.175			1.115			1.055			0.995			0.935
Return on Equity
Net Income/Average Equity		15.1	%		13.9	%		10.8	%		1.0	%		10.8	%		12.1	%		9.6	%		11.0	%		22.4	%		13.3	%
Inc from Operations/Average Equity		15.4	%		14.3	%		12.5	%		8.7	%		12.7	%		14.1	%		9.9	%		11.4	%		1.4	%		11.3	%
Market Value of Common Stock
High for the Year	$	54.41		$	50.38		$	41.32		$	53.65		$	52.75		$	56.38		$	57.50		$	49.44		$	39.06		$	28.50
Low for the Year		41.59			40.06			24.73			25.15			38.00			22.63			36.00			33.50			24.50			20.38
Close for the Year		53.03			46.68			40.37			31.58			48.57			47.31			40.00			40.91			39.06			26.25

3/31/2006																									PAGE 8
Quarterly Summary
Unaudited [Millions of Dollars, except Common Share Data]
	Mar			Jun			Sep			Dec			Mar			Jun			Sep			Dec			Mar
For the Quarter Ended	2004			2004			2004			2004			2005			2005			2005			2005			2006
Operating Revenue
Lincoln Retirement	$	528.0		$	534.4		$	526.2		$	539.4		$	538.5		$	573.0		$	573.1		$	573.3		$	586.7
Life Insurance		483.4			484.8			481.1			503.7			484.2			497.3			492.4			519.6			515.0
Investment Management		135.2			139.0			133.0			127.7			130.4			138.0			146.8			152.7			162.6
Lincoln UK		76.1			81.0			95.8			89.3			74.6			78.4			102.8			62.5			69.5
Corporate & Other		56.1			105.5			92.4			81.1			73.8			95.2			93.8			89.2			83.9
Total Operating Revenue		1,278.8			1,344.7			1,328.5			1,341.2			1,301.5			1,382.0			1,409.0			1,397.4			1,417.8
Realized gains (losses) on investments and derivatives		(15.9	)		(20.6	)		(27.5	)		6.7			(7.2	)		(4.0	)		(1.6	)		(9.3	)		(6.9	)
Net gain (loss) on reinsurance
derivative/trading account securities		(4.2	)		10.3			(5.6	)		(1.4	)		4.4			(5.1	)		5.3			0.0			5.9
Gain on sale of subsidiaries/ businesses		-			24.1			110.3			0.6			14.2			-			-			-			-
Amortization of deferred gain-reserve development		0.3			0.3			0.3			0.3			0.3			0.3			0.3			0.3			0.3
Total Revenue	$	1,259.0		$	1,358.7		$	1,406.1		$	1,347.5		$	1,313.2		$	1,373.2		$	1,413.1		$	1,388.4		$	1,417.0
Income from Operations
Lincoln Retirement	$	102.2		$	101.8		$	110.2		$	100.5		$	98.6		$	119.4		$	136.2		$	117.3		$	123.1
Life Insurance		74.8			76.2			55.4			74.0			67.7			75.8			75.1			80.2			82.2
Investment Management		12.5			13.4			12.5			5.2			7.4			3.9			10.2			14.6			20.3
Lincoln UK		6.2			10.7			10.1			16.6			10.0			10.3			9.6			13.5			10.7
Corporate & Other		(20.3	)		(20.7	)		(9.9	)		(6.3	)		(11.3	)		9.2			(2.9	)		6.7			(14.6	)
Income from Operations		175.3			181.4			178.2			189.9			172.5			218.6			228.2			232.3			221.8
Realized gains (losses) on investments and derivatives		(10.3	)		(13.4	)		(17.9	)		4.3			(4.6	)		(2.7	)		(1.1	)		(6.1	)		(4.4	)
Net gain (loss) on reinsurance
derivative/trading account securities		(2.7	)		6.7			(3.7	)		(0.8	)		2.8			(3.3	)		3.5			0.0			3.8
Gain on sale of subsidiaries/ businesses		-			15.6			45.9			0.4			9.3			-			-			-			-
Reserve development/ amortization of related deferred gain		0.2			0.2			0.2			0.2			0.2			0.2			0.2			0.2			0.2
Restructuring charges		(7.5	)		(3.5	)		(2.9	)		(0.0	)		(1.3	)		(15.0	)		(1.8	)		(1.1	)		(0.2	)
Loss on early retirement of debt		-			-			-			(4.1	)		-			-			-			-			-
Income Before Cumulative Effect of
Accounting Change		155.0			187.0			199.7			189.9			178.9			197.9			228.9			225.3			221.2
Cumulative effect of accounting change, net of tax		(24.5	)		(0.0	)		-			-			-			-			-			-			-
Net Income	$	130.5		$	187.0		$	199.7		$	189.9		$	178.9		$	197.9		$	228.9		$	225.3		$	221.2
OTHER DATA
Assets	$	109,869.9		$	109,317.9		$	110,377.1		$	116,219.3		$	116,352.2		$	118,953.4		$	122,104.6		$	124,787.6		$	128,393.9
Shareholders' Equity
Beg of Period (including AOCI)	$	5,811.6		$	6,143.5		$	5,518.9		$	5,970.8		$	6,175.6		$	6,042.9		$	6,363.5		$	6,284.4		$	6,384.4
End of Period (including AOCI)		6,143.5			5,518.9			5,970.8			6,175.6			6,042.9			6,363.5			6,284.4			6,384.4			6,338.2
End of Period (excluding AOCI)		5,004.2			5,023.6			5,109.8			5,244.9			5,365.8			5,448.3			5,663.5			5,856.6			6,053.2
Average Equity (excluding AOCI)		5,016.8			5,024.6			5,075.7			5,185.0			5,338.8			5,392.3			5,559.8			5,757.7			5,954.9
Common Shares Outstanding
Average for the Period - Diluted		181.2			180.3			177.7			176.7			176.6			175.4			175.8			176.6			177.9
End of Period - Diluted		181.4			178.8			177.1			176.1			176.5			174.8			176.3			176.9			178.5
Per Share Data (Diluted)
Net Income	$	0.72		$	1.04		$	1.12		$	1.07		$	1.01		$	1.13		$	1.30		$	1.28		$	1.24
Income from Operations		0.97			1.00			1.00			1.07			0.98			1.25			1.30			1.31			1.25
Shareholders' Equity Per Share
Shareholders' Equity (including AOCI)	$	34.36		$	31.32		$	34.15		$	35.53		$	34.74		$	36.86		$	36.23		$	36.69		$	35.99
Shareholders' Equity (excluding AOCI)		27.99			28.51			29.23			30.17			30.85			31.56			32.65			33.66			34.37
Dividends Declared (Common Stock)		0.350			0.350			0.350			0.365			0.365			0.365			0.365			0.380			0.380
Return on Equity
Net Income/Average Equity		10.4	%		14.9	%		15.7	%		14.6	%		13.4	%		14.7	%		16.5	%		15.7	%		14.9	%
Inc from Operations/Average Equity		14.0	%		14.4	%		14.0	%		14.7	%		12.9	%		16.2	%		16.4	%		16.1	%		14.9	%
Market Value of Common Stock
Highest Price	$	48.87		$	50.38		$	47.50		$	48.70		$	49.42		$	47.77		$	52.42		$	54.41		$	57.97
Lowest Price		40.06			43.26			41.90			40.79			44.36			41.59			46.59			46.94			52.00
Closing Price		47.32			47.25			47.00			46.68			45.14			46.92			52.02			53.03			54.59

3/31/2006													PAGE 9
Consolidated Statements of Income
Unaudited [Millions of Dollars]
For the Year Ended December 31	2001			2002			2003			2004			2005
Revenue
Premiums	$	1,704.0		$	315.9		$	281.0		$	298.9		$	308.4
Surrender charges		101.5			87.8			84.7			78.7			73.3
Mortality assessments		533.3			530.3			550.5			558.3			568.3
Expense assessments		880.1			792.7			782.3			949.3			1,120.6
Investment advisory fees		197.2			183.3			205.0			252.5			279.0
Amortization of deferred gain		20.4			75.2			72.3			87.0			75.7
Amortization of deferred gain-reserve development		-			(0.8	)		3.6			1.3			1.3
Other revenue and fees		328.7			299.5			309.7			364.4			362.3
Net investment income		2,708.7			2,631.9			2,638.5			2,704.1			2,702.3
Earnings in unconsolidated affiliates		5.7			(0.6	)		-			-			-
Realized gains (losses) on investments		(105.2	)		(272.7	)		(16.7	)		(45.7	)		(21.7	)
Gains (losses) on derivatives		(9.3	)		1.2			(2.5	)		(11.6	)		(0.5	)
Net gain (loss) on reinsurance
derivative/trading account securities		-			-			4.1			(1.0	)		4.7
Gain on sale of subsidiaries/ businesses		12.8			(8.3	)		-			135.0			14.2
Mark-to-market adjustment on reclassification
from AFS to trading account securities		-			-			371.5			-			-
Total Revenue		6,378.0			4,635.5			5,283.9			5,371.3			5,487.9
Benefits and Expenses
Ins. benefits paid or provided:
Policy benefits		1,820.0			861.0			697.8			696.2			761.6
Div accum & div to policyholders		83.7			76.0			81.6			77.4			77.7
Interest credited to policy bal.		1,506.0			1,617.1			1,617.0			1,570.6			1,570.1
Reserve developments on reins. business sold		-			305.4			32.1			-			-
Def. sales inducements net of amortization		(12.1	)		(12.6	)		(14.1	)		(40.6	)		(43.9	)
Total insurance benefits		3,397.7			2,846.9			2,414.4			2,303.7			2,365.6
Underwriting, acquisition,
insurance and other expenses:
Commissions and other volume related expenses		1,045.2			836.1			904.6			1,133.1			1,287.2
Operating and administrative expenses		1,114.5			928.0			894.4			897.4			914.1
Restructuring charges		38.0			(2.2	)		53.8			21.4			29.5
Taxes, licenses and fees		122.9			106.8			107.4			103.6			95.3
Foreign exchange		(1.4	)		0.3			(0.0	)		-			-
Subtotal		2,319.1			1,869.0			1,960.2			2,155.5			2,326.1
DAC deferral net of amortization		(334.2	)		(268.0	)		(321.6	)		(354.1	)		(442.1	)
VOBA amortization		113.1			136.5			80.2			120.3			67.2
Other intangibles amortization		12.1			8.2			7.9			9.7			7.8
Total underwriting, acquisition,
insurance and other expenses		2,110.1			1,745.8			1,726.8			1,931.5			1,959.0
Goodwill amortization		43.4			-			-			-			-
Interest		121.0			96.6			89.5			94.1			88.7
Loss on early retirement of debt								5.6			6.3
Total Benefits and Expenses		5,672.1			4,689.3			4,236.3			4,335.6			4,413.3
Income (Loss) Before Federal Income Tax and
Cumulative Effect of Accounting Change		705.9			(53.8	)		1,047.6			1,035.7			1,074.6
Federal income taxes		144.7			(102.6	)		280.4			304.1			243.6
Income Before Cumulative Effect of
Accounting Change		561.2			48.8			767.2			731.5			831.1
Cumulative effect of accounting change		(15.6	)		-			(255.2	)		(24.5	)		-
Net Income	$	545.7		$	48.8		$	511.9		$	707.0		$	831.1
Roll Forward of Deferred Acquisition Costs
Balance at beginning of period	$	3,070.5		$	2,866.8		$	2,939.7		$	3,147.1		$	3,445.0
Deferral		701.0			612.4			639.6			844.8			903.2
Amortization		(366.8	)		(344.4	)		(318.0	)		(490.8	)		(461.1	)
Included in Total Benefits and Expenses		334.2			268.0			321.6			354.1			442.1
Adjustment related to realized (gains) losses
on available-for-sale securities		112.9			115.0			(50.2	)		(45.7	)		(48.5	)
Adjustment related to unrealized (gains) losses
on available-for-sale securities		(187.2	)		(338.5	)		(126.1	)		(14.8	)		313.1
Foreign currency translation adjustment		(16.0	)		56.9			62.1			42.9			(59.5	)
Disposition of business		(425.9	)		-			-			-			-
Other		(21.7	)		(28.4	)		-			(38.7	)		-
Balance at end of period	$	2,866.7		$	2,939.9		$	3,147.1		$	3,445.0		$	4,092.2
Roll Forward of Value of Business Acquired
Balance at beginning of period	$	1,483.3		$	1,362.5		$	1,250.1		$	1,196.5		$	1,095.2
Amortization		(113.1	)		(136.5	)		(80.2	)		(120.3	)		(67.2	)
Foreign currency translation adjustment		(7.0	)		24.1			26.6			19.6			(29.0	)
Other		(0.7	)		-			-			(0.6	)		-
Balance at end of period	$	1,362.5		$	1,250.1		$	1,196.5		$	1,095.2		$	998.9
Roll Forward of Deferred Front-End Load*
Balance at beginning of period	$	550.6		$	589.7		$	656.8		$	750.6		$	764.1
Deferral		107.5			102.5			102.5			104.6			89.1
Amortization		(57.8	)		(75.7	)		(54.4	)		(122.8	)		(85.8	)
Included in Income from Operations		49.7			26.8			48.1			(18.2	)		3.3
Foreign currency translation adjustment		(10.6	)		40.2			45.8			31.7			(43.9	)
Balance at end of period	$	589.7		$	656.8		$	750.6		$	764.1		$	723.6
* Included in Insurance and Investment Contract Liabilities on the Balance Sheet

3/31/2006																									PAGE 10
Consolidated Statements of Income
Unaudited [Millions of Dollars]
For the Quarter Ended	Mar			Jun			Sep			Dec			Mar			Jun			Sep			Dec			Mar
	2004			2004			2004			2004			2005			2005			2005			2005			2006
Revenue
Premiums	$	75.6		$	74.0		$	70.6		$	78.7		$	70.4		$	72.6		$	83.1		$	82.4		$	78.3
Surrender charges		20.2			19.2			18.2			21.1			20.1			16.6			18.7			18.0			18.8
Mortality assessments		137.9			140.1			139.8			140.4			142.3			142.1			138.8			145.1			146.2
Expense assessments		225.5			230.9			234.5			258.5			256.6			268.1			287.3			308.5			310.9
Investment advisory fees		62.7			66.4			67.4			56.0			59.4			66.9			73.6			79.0			84.9
Amortization of deferred gain		17.9			17.9			32.1			19.1			18.9			18.9			18.9			18.9			18.8
Amortization of deferred gain-reserve development		0.3			0.3			0.3			0.3			0.3			0.3			0.3			0.3			0.3
Other revenue and fees		61.4			112.9			96.6			93.4			74.0			93.2			117.7			77.3			81.6
Net investment income		677.5			683.1			669.4			674.1			659.8			703.6			670.8			668.1			678.3
Realized gains (losses) on investments		(12.0	)		(17.8	)		(23.0	)		7.2			(8.7	)		(0.6	)		(2.7	)		(9.6	)		(10.5	)
Gains (losses) on derivatives		(3.8	)		(2.8	)		(4.5	)		(0.4	)		1.5			(3.4	)		1.2			0.2			3.5
Gain (loss) on reinsurance
derivative/trading account securities		(4.2	)		10.3			(5.6	)		(1.4	)		4.4			(5.1	)		5.3			0.0			5.9
Gain (loss) on sale of subsidiaries/ businesses		-			24.1			110.3			0.6			14.2			-			-			-			-
Mark-to-market adjustment on reclassification
from AFS to trading account securities		-			-			-			-			-			-			-			-			-
Total Revenue		1,259.0			1,358.7			1,406.1			1,347.5			1,313.2			1,373.2			1,413.1			1,388.4			1,417.0
Benefits and Expenses
Ins. benefits paid or provided:
Policy benefits		183.5			184.1			157.3			171.4			174.1			194.8			213.2			179.5			185.7
Div accum & div to policyholders		18.5			18.6			16.7			23.6			18.4			18.4			17.3			23.6			17.4
Interest credited to policy bal.		390.4			390.4			392.5			397.4			389.5			391.8			394.2			394.7			391.8
Def. sales inducements net of amortization		(9.0	)		(9.8	)		(10.4	)		(11.5	)		(9.4	)		(11.7	)		(11.5	)		(11.3	)		(10.5	)
Total insurance benefits		583.3			583.3			556.1			580.9			572.6			593.3			613.2			586.5			584.4
Underwriting, acquisition,
insurance and other expenses:
Commissions and other volume related expenses		278.9			277.7			245.1			331.3			285.0			312.2			332.8			357.2			333.7
Operating and administrative expenses		187.4			252.3			264.6			193.1			212.4			235.2			249.1			217.3			200.2
Restructuring charges		11.5			5.3			4.5			0.1			1.9			23.2			2.7			1.7			0.3
Taxes, licenses and fees		29.5			27.2			25.6			21.3			30.9			23.1			24.1			17.2			33.4
Subtotal		507.4			562.6			539.8			545.8			530.2			593.7			608.8			593.4			567.6
DAC deferral net of amortization		(89.9	)		(93.9	)		(85.4	)		(84.9	)		(70.7	)		(92.3	)		(153.8	)		(125.4	)		(90.6	)
VOBA amortization		24.8			20.5			50.8			24.2			18.9			16.5			18.2			13.6			17.2
Other intangibles amortization		2.0			2.0			2.0			3.8			1.9			1.9			2.0			2.0			2.0
Total underwriting, acquisition,
insurance and other expenses		444.3			491.2			507.1			488.9			480.4			519.8			475.2			483.6			496.1
Interest		22.8			24.7			24.4			22.2			22.4			22.1			21.7			22.4			21.7
Loss on early retirement of debt		-			-			-			6.3			-			-			-			-			-
Total Benefits and Expenses		1,050.4			1,099.1			1,087.7			1,098.4			1,075.4			1,135.2			1,110.1			1,092.5			1,102.1
Income Before Federal Income Tax and
Cumulative Effect of Accounting Change		208.6			259.6			318.4			249.1			237.8			238.0			303.0			295.9			314.9
Federal income taxes		53.7			72.6			118.7			59.2			58.9			40.1			74.0			70.6			93.6
Income Before Cumulative Effect of
Accounting Change		155.0			187.0			199.7			189.9			178.9			197.9			228.9			225.3			221.2
Cumulative effect of accounting change		(24.5	)		(0.0	)		-			-			-			-			-			-			-
Net Income	$	130.5		$	187.0		$	199.7		$	189.9		$	178.9		$	197.9		$	228.9		$	225.3		$	221.2
Roll Forward of Deferred Acquisition Costs
Balance at beginning of period	$	3,147.1		$	2,999.0		$	3,521.4		$	3,326.8		$	3,445.0		$	3,712.7		$	3,554.5		$	3,904.0		$	4,092.2
Deferral		198.7			201.8			206.2			238.1			203.5			215.0			229.9			253.5			235.1
Amortization		(108.8	)		(108.0	)		(120.8	)		(153.2	)		(132.8	)		(122.7	)		(76.1	)		(128.1	)		(144.5	)
Included in Total Benefits and Expenses		89.9			93.9			85.4			84.9			70.7			92.3			153.8			125.4			90.6
Adjustment related to realized (gains) losses
on available-for-sale securities		(17.6	)		(6.0	)		(6.2	)		(15.8	)		(11.7	)		(14.3	)		(13.8	)		(8.7	)		(10.9	)
Adjustment related to unrealized (gains) losses
on available-for-sale securities		(201.1	)		442.7			(271.2	)		14.7			215.7			(204.8	)		217.4			84.7			194.2
Foreign currency translation adjustment		19.9			(8.4	)		(2.5	)		33.8			(7.0	)		(31.4	)		(8.0	)		(13.2	)		5.1
Other		(39.2	)		0.2			(0.2	)		0.5			(0.0	)		-			-			-			-
Balance at end of period	$	2,999.0		$	3,521.4		$	3,326.8		$	3,445.0		$	3,712.7		$	3,554.5		$	3,904.0		$	4,092.2		$	4,371.2
Roll Forward of Value of Business Acquired
Balance at beginning of period	$	1,198.0		$	1,180.0		$	1,155.8		$	1,103.9		$	1,095.2		$	1,073.1		$	1,041.7		$	1,019.4		$	998.9
Amortization		(24.8	)		(20.5	)		(50.8	)		(24.2	)		(18.9	)		(16.5	)		(18.2	)		(13.6	)		(17.2	)
Foreign currency translation adjustment		7.4			(3.7	)		(1.1	)		15.6			(3.3	)		(14.8	)		(4.1	)		(6.9	)		2.7
Other		(0.6	)		-			-			-			-			-			-			-			-
Balance at end of period	$	1,180.0		$	1,155.8		$	1,103.9		$	1,095.2		$	1,073.1		$	1,041.7		$	1,019.4		$	998.9		$	984.4
Roll Forward of Deferred Front-End Load*
Balance at beginning of period	$	750.6		$	768.5		$	764.7		$	744.4		$	764.1		$	756.2		$	731.4		$	721.2		$	723.6
Deferral		25.0			25.8			25.2			28.6			22.6			22.0			20.8			23.7			21.7
Amortization		(21.8	)		(23.3	)		(43.7	)		(34.0	)		(25.2	)		(23.6	)		(25.0	)		(11.9	)		(21.4	)
Included in Income from Operations		3.1			2.4			(18.5	)		(5.3	)		(2.7	)		(1.5	)		(4.2	)		11.8			0.3
Foreign currency translation adjustment		14.7			(6.2	)		(1.8	)		25.0			(5.2	)		(23.3	)		(5.9	)		(9.5	)		3.8
Balance at end of period	$	768.5		$	764.7		$	744.4		$	764.1		$	756.2		$	731.4		$	721.2		$	723.6		$	727.7
* Included in Insurance and Investment Contract Liabilities on the Balance Sheet

3/31/2006																					PAGE 11
Consolidating Statements of Income from Operations
Unaudited [Millions of Dollars]
													Investment
For the Quarter Ended March 31	Lincoln Retirement						Life Insurance						Management						Lincoln UK
	Mar			Mar			Mar			Mar			Mar			Mar			Mar		Mar
	2006			2005			2006			2005			2006			2005			2006		2005
Operating Revenue
Premiums	$	10.3		$	10.5		$	51.2		$	45.6		$	-		$	-		$	16.5	$	14.6
Surrender charges		7.6			7.4			10.3			12.0			0.8			0.7			-		-
Mortality assessments		-			-			138.4			133.3			-			-			7.8		9.0
Expense assessments		212.3			164.6			52.8			48.8			19.8			16.6			25.7		26.6
Investment advisory fees		-			-			-			-			110.0			84.2			-		-
Other revenue and fees		(2.5	)		(1.4	)		8.7			8.2			19.1			16.0			2.4		4.1
Net investment income		358.9			357.4			253.6			236.3			12.9			12.9			17.0		20.3
Total Operating Revenue		586.7			538.5			515.0			484.2			162.6			130.4			69.5		74.6
Operating Expenses
Ins. benefits paid or provided:
Policy benefits		50.9			52.4			107.5			97.4			-			-			25.4		25.1
Div accum & div to policyholders		-			-			17.4			18.4			-			-			-		-
Interest credited to policy bal.		200.6			204.7			150.1			145.8			7.1			6.8			-		-
Def. sales inducements net of amortization		(10.5	)		(9.4	)		-			-			-			-			-		-
Total insurance benefits		241.0			247.8			275.0			261.6			7.1			6.8			25.4		25.1
Underwriting, acquisition,
insurance and other expenses:
Commissions and other volume related expenses		173.0			149.7			87.4			77.2			16.7			14.8			0.9		0.6
Operating and administrative expenses		56.1			56.8			35.0			40.7			104.5			96.4			22.7		25.4
Taxes, licenses and fees		3.7			3.9			15.2			14.7			4.8			3.0			0.0		-
Subtotal		232.8			210.4			137.5			132.6			125.9			114.2			23.6		25.9
DAC deferral net of amortization		(56.3	)		(49.4	)		(35.9	)		(25.2	)		(2.7	)		(3.3	)		3.5		7.1
VOBA amortization		2.7			2.4			13.9			15.5			-			-			0.5		1.0
Other intangibles amortization		-			-			-			-			2.0			1.9			-		-
Total underwriting, acquisition,
insurance and other expenses		179.2			163.3			115.6			122.9			125.2			112.8			27.6		34.0
Total Operating Expenses		420.2			411.1			390.6			384.5			132.3			119.6			52.9		59.2
Income from Operations before federal taxes		166.5			127.4			124.4			99.7			30.3			10.7			16.5		15.5
Federal income taxes		43.3			28.8			42.2			32.0			10.0			3.3			5.8		5.4
Income from Operations	$	123.1		$	98.6		$	82.2		$	67.7		$	20.3		$	7.4		$	10.7	$	10.0

3/31/2006																PAGE 12
Consolidating Statements of Income from Operations
Unaudited [Millions of Dollars]
	Corporate and						Consolidating
For the Quarter Ended March 31	Other Operations						Adjustments						Consolidated *
	Mar			Mar			Mar			Mar			Mar			Mar
	2006			2005			2006			2005			2006			2005
Operating Revenue
Premiums	$	0.3		$	(0.3	)	$	-		$	-		$	78.3		$	70.4
Surrender charges		-			-			-			-			18.8			20.1
Mortality assessments		-			-			-			-			146.2			142.3
Expense assessments		0.3			-			-			-			310.9			256.6
Investment advisory fees		-			-			(25.1	)		(24.8	)		84.9			59.4
Amortization of deferred gain		18.8			18.9			-			-			18.8			18.9
Other revenue and fees		192.8			191.3			(139.0	)		(144.2	)		81.6			74.0
Net investment income		36.6			34.0			(0.8	)		(1.0	)		678.3			659.8
Total Operating Revenue		248.8			243.8			(164.8	)		(170.0	)		1,417.8			1,301.5
Operating Expenses
Ins. benefits paid or provided:
Policy benefits		2.0			(0.8	)		-			-			185.7			174.1
Div accum & div to policyholders		-			-			-			-			17.4			18.4
Interest credited to policy bal.		33.9			32.1			-			-			391.8			389.5
Def. sales inducements net of amortization		-			-			-			-			(10.5	)		(9.4	)
Total insurance benefits		35.9			31.3			-			-			584.4			572.6
Underwriting, acquisition,
insurance and other expenses:
Commissions and other volume related expenses		119.6			121.7			(63.8	)		(78.9	)		333.7			285.0
Operating and administrative expenses		82.7			83.8			(100.5	)		(90.4	)		200.4			212.6
Taxes, licenses and fees		9.6			9.3			-			-			33.4			30.9
Subtotal		211.9			214.7			(164.3	)		(169.3	)		567.4			528.5
DAC deferral net of amortization		0.8			0.1			-			-			(90.6	)		(70.7	)
VOBA amortization		-			-			-			-			17.2			18.9
Other intangibles amortization		-			-			-			-			2.0			1.9
Total underwriting, acquisition,
insurance and other expenses		212.7			214.8			(164.3	)		(169.3	)		495.9			478.7
Interest		22.0			22.9			(0.5	)		(0.7	)		21.5			22.2
Foreign exchange adjustment		-			-			-			-			-			-
Total Operating Expenses		270.6			269.1			(164.8	)		(170.0	)		1,101.8			1,073.5
Income (Loss) from Operations before federal taxes		(21.8	)		(25.2	)								315.9			228.0
Federal income taxes		(7.2	)		(14.0	)								94.1			55.5
Income (Loss) from Operations	$	(14.6	)	$	(11.3	)							$	221.8		$	172.5
* See page 1 for a reconciliation of Income from Operations to consolidated Net Income

3/31/2006													PAGE 13
Five Year Comparative Balance Sheet
Unaudited [Millions of Dollars except Common Share Data]
	As of December 31,
ASSETS	2001			2002			2003			2004			2005
Investments
Corporate bonds	$	23,105.1		$	25,934.7		$	25,868.5		$	26,889.0		$	25,860.7
U.S. government bonds		410.5			513.6			225.8			163.0			161.8
Foreign government bonds		1,174.7			1,110.2			1,194.6			1,285.9			1,203.3
Mortgage backed securities		3,524.7			5,015.5			5,195.6			6,090.5			5,951.2
State and municipal bonds		44.7			114.4			152.8			166.0			128.8
Preferred stocks-redeemable		85.9			79.0			132.2			106.1			137.4
Common stocks		319.3			228.0			98.4			69.8			55.9
Preferred stocks-equity		151.2			109.2			100.7			91.3			88.8
Total AFS Securities		28,816.1			33,104.7			32,968.6			34,861.7			33,587.9
Trading securities		-			-			3,120.1			3,237.4			3,246.0
Mortgage loans		4,535.5			4,205.5			4,195.0			3,856.9			3,662.6
Real estate		267.9			279.7			112.9			191.4			182.7
Policy loans		1,939.7			1,945.6			1,924.4			1,870.6			1,862.2
Other long-term investments		553.8			464.4			456.7			489.3			626.9
Total Investments		36,113.1			39,999.9			42,777.6			44,507.3			43,168.4
Invest in unconsol affiliates		8.1			-			-			-			-
Cash and invested cash		3,095.5			1,690.5			1,711.2			1,661.7			2,311.7
Premiums and fees receivable		400.1			212.9			352.1			232.9			343.2
Accrued investment income		563.5			536.7			522.7			525.1			526.4
Federal income taxes recoverable		55.5			317.7			45.9			-			-
Amounts recoverable from reinsurers		6,030.4			7,280.0			7,839.2			7,067.5			6,926.3
Deferred acquisition costs		2,866.8			2,939.7			3,147.1			3,445.0			4,092.2
Value of business acquired		1,362.5			1,250.1			1,196.5			1,095.2			998.9
Other intangible assets		68.6			73.0			79.1			106.4			143.3
Goodwill		1,211.8			1,233.2			1,234.7			1,195.9			1,194.2
Other		1,432.4			1,472.5			1,273.5			1,177.7			1,336.1
Assets held in separate accounts		44,833.4			36,178.3			46,565.2			55,204.6			63,746.8
Total Assets	$	98,041.6		$	93,184.6		$	106,744.9		$	116,219.3		$	124,787.6
LIABILITIES and SHAREHOLDERS' EQUITY
Liabilities
Insurance and Investment Contract Liabilities:
Reserves	$	20,454.9		$	22,639.3		$	23,549.8		$	23,242.1		$	23,609.2
Unpaid claims		1,087.5			778.4			1,058.4			1,080.3			1,040.8
Unearned premiums		66.9			141.2			104.5			5.8			2.1
Premium deposit funds		18,585.0			20,518.8			21,769.3			22,215.1			21,713.3
Participating policyholders' funds		100.2			156.7			155.1			145.3			111.2
Other policyholders' funds		562.7			610.9			680.9			714.0			746.1
Total Ins and Inv Contr Liabilities		40,857.2			44,845.3			47,318.1			47,402.5			47,222.8
Federal income tax liabilities		-			-			-			77.6			19.8
Short-term debt		350.2			153.0			44.0			214.4			119.9
Long-term debt		861.8			1,119.2			1,117.5			1,048.6			999.0
Junior subordinated debentures issued to affiliated trusts		474.7			392.7			341.3			339.8			334.0
Embedded derivative - modco		-			-			352.3			375.3			292.2
Other liabilities		4,216.1			4,171.5			4,270.1			4,467.8			4,832.8
Deferred gain on indemnity reinsurance		1,144.5			977.1			924.8			913.0			836.0
Liability related to separate accounts		44,833.4			36,178.3			46,565.2			55,204.6			63,746.8
Total Liabilities		92,737.8			87,837.2			100,933.2			110,043.7			118,403.2
Unrealized gains		217.2			781.6			815.1			836.9			503.9
Foreign currency		(8.0	)		50.8			109.0			154.3			83.4
Minimum pension liability adjustment		(36.0	)		(97.8	)		(55.1	)		(60.5	)		(59.5	)
Shareholders' equity- other		5,130.6			4,612.9			4,942.6			5,244.9			5,856.6
Total Shareholders' Equity		5,303.8			5,347.5			5,811.6			6,175.6			6,384.4
Total Liabilities
and Shareholders' Equity	$	98,041.6		$	93,184.6		$	106,744.9		$	116,219.3		$	124,787.6
Shareholders' Equity Per Share
Book Value, Excluding AOCI	$	27.39		$	25.97		$	27.69		$	30.17		$	33.66
Common shares outstanding (in millions)		187.3			177.6			178.5			173.8			174.0

3/31/2006																									PAGE 14
Quarterly Balance Sheet
Unaudited [Millions of Dollars, except Common Share Data]
	Mar			Jun			Sep			Dec			Mar			Jun			Sep			Dec			Mar
	2004			2004			2004			2004			2005			2005			2005			2005			2006
ASSETS
Investments
Corporate bonds	$	26,209.2		$	25,638.1		$	26,750.0		$	26,889.0		$	26,305.9		$	26,757.7		$	26,453.6		$	25,860.7		$	25,418.0
U.S. government bonds		234.2			156.3			162.9			163.0			165.7			174.4			158.3			161.8			173.4
Foreign government bonds		1,321.0			1,223.8			1,233.8			1,285.9			1,296.7			1,248.0			1,195.0			1,203.3			1,169.7
Mortgage backed securities		5,617.0			5,524.1			5,793.4			6,090.5			6,193.8			6,503.0			6,237.1			5,951.2			5,868.8
State and municipal bonds		164.1			164.8			168.8			166.0			156.3			160.8			157.9			128.8			126.0
Preferred stocks - redeemable		120.9			100.7			113.9			106.1			106.5			131.2			123.0			137.4			136.9
Common stocks		97.4			92.3			86.5			69.8			65.2			64.2			62.2			55.9			61.0
Preferred stocks-equity		100.2			90.5			91.6			91.3			89.6			90.3			89.4			88.8			115.0
Total AFS Securities		33,864.1			32,990.5			34,400.8			34,861.7			34,379.6			35,129.6			34,476.5			33,587.9			33,068.8
Trading securities		3,191.3			3,087.9			3,223.6			3,237.4			3,206.5			3,345.1			3,287.0			3,246.0			3,190.1
Mortgage loans		3,988.5			3,865.4			3,831.3			3,856.9			3,805.7			3,750.6			3,696.2			3,662.6			3,586.2
Real estate		104.8			104.3			135.1			191.4			213.4			209.8			196.6			182.7			180.4
Policy loans		1,876.7			1,871.3			1,871.9			1,870.6			1,860.5			1,866.9			1,856.4			1,862.2			1,860.4
Other long-term investments		476.3			442.9			463.8			489.3			516.5			561.3			572.3			626.9			687.5
Total Investments		43,501.7			42,362.5			43,926.6			44,507.3			43,982.2			44,863.3			44,085.0			43,168.4			42,573.2
Cash and invested cash		2,255.5			2,213.7			1,996.0			1,661.7			1,499.1			1,658.9			1,601.9			2,311.7			1,974.0
Premiums and fees receivable		337.5			265.2			248.8			232.9			299.3			222.8			332.6			343.2			363.2
Accrued investment income		547.9			543.7			573.2			525.1			557.6			537.5			565.2			526.4			532.1
Federal income taxes recoverable		-			204.0			-			-			5.0			-			-			-			67.2
Amount recoverable from reinsurers		7,865.7			7,138.7			7,031.9			7,067.5			7,336.5			7,241.6			7,211.0			6,926.3			6,899.4
Deferred acquisition costs		2,999.0			3,521.4			3,326.8			3,445.0			3,712.7			3,554.5			3,904.0			4,092.2			4,371.2
Value of business acquired		1,180.0			1,155.8			1,103.9			1,095.2			1,073.1			1,041.7			1,019.4			998.9			984.4
Other intangible assets		85.8			93.6			98.7			106.4			113.8			124.4			134.0			143.3			151.8
Goodwill		1,235.2			1,235.0			1,195.0			1,195.9			1,195.7			1,194.8			1,194.6			1,194.2			1,194.4
Other		1,303.7			1,240.5			1,218.4			1,177.7			1,190.0			1,273.9			1,245.5			1,336.1			1,298.7
Assets held in separate accounts		48,557.9			49,343.7			49,657.9			55,204.6			55,387.2			57,240.0			60,811.5			63,746.8			67,984.2
Total Assets	$	109,869.9		$	109,317.9		$	110,377.1		$	116,219.3		$	116,352.2		$	118,953.4		$	122,104.6		$	124,787.6		$	128,393.9
LIABILITIES and SHAREHOLDERS' EQUITY
Liabilities
Insurance and Inv Contract Liabilities:
Reserves	$	23,704.6		$	23,165.1		$	23,010.1		$	23,242.1		$	23,498.2		$	23,555.6		$	23,690.2		$	23,609.2		$	23,734.5
Unpaid claims		1,076.8			1,083.5			1,067.0			1,080.3			1,164.9			1,114.2			1,037.7			1,040.8			979.0
Unearned premiums		104.3			9.3			7.5			5.8			3.1			1.9			1.2			2.1			2.3
Premium deposit funds		21,827.4			22,017.0			22,218.9			22,215.1			22,026.0			22,075.8			21,932.7			21,713.3			21,448.6
Participating policyholders' funds		171.1			165.9			165.2			145.3			128.1			146.3			123.3			111.2			89.5
Other policyholders' funds		688.1			698.5			703.4			714.0			716.1			717.6			740.2			746.1			746.6
Total Ins and Inv Contr Liabilities		47,572.3			47,139.3			47,172.2			47,402.5			47,536.4			47,611.5			47,525.3			47,222.8			47,000.5
Federal income taxes		108.1			-			83.8			77.6			-			160.8			31.5			19.8			-
Short-term debt		38.0			30.0			0.0			214.4			194.0			222.5			165.1			119.9			10.6
Long-term debt		1,317.7			1,313.7			1,315.4			1,048.6			1,046.6			1,000.6			999.5			999.0			998.5
Junior subordinated debentures issued to
affiliated trusts		344.7			337.6			341.1			339.8			336.6			338.7			335.9			334.0			332.3
Embedded derivative - modco		440.6			252.6			365.5			375.3			313.5			420.3			314.1			292.2			192.0
Other liabilities		4,440.4			4,493.6			4,537.9			4,467.8			4,601.3			4,721.1			4,782.1			4,832.8			4,720.7
Deferred gain on indemnity reinsurance		906.6			888.4			932.4			913.0			893.7			874.5			855.2			836.0			816.9
Liab related to separate accounts		48,557.9			49,343.7			49,657.9			55,204.6			55,387.2			57,240.0			60,811.5			63,746.8			67,984.2
Total Liabilities		103,726.4			103,799.0			104,406.3			110,043.7			110,309.3			112,590.0			115,820.2			118,403.2			122,055.7
Unrealized gains on investments		1,038.0			412.0			780.1			822.9			582.9			851.2			569.0			496.6			220.2
Gains - derivatives		29.0			18.5			19.8			14.0			7.7			11.9			8.9			7.3			35.2
Foreign currency		128.9			120.8			116.9			154.3			146.5			109.4			99.6			83.4			89.7
Minimum pension liability		(56.6	)		(56.0	)		(55.8	)		(60.5	)		(60.0	)		(57.3	)		(56.6	)		(59.5	)		(60.1	)
Shareholders' equity- other		5,004.2			5,023.6			5,109.8			5,244.9			5,365.8			5,448.3			5,663.5			5,856.6			6,053.2
Total Shareholders' Equity		6,143.5			5,518.9			5,970.8			6,175.6			6,042.9			6,363.5			6,284.4			6,384.4			6,338.2
Total Liabilities
and Shareholders' Equity	$	109,869.9		$	109,317.9		$	110,377.1		$	116,219.3		$	116,352.2		$	118,953.4		$	122,104.6		$	124,787.6		$	128,393.9
Shareholders' Equity Per Share
Book Value, Excluding AOCI	$	27.99		$	28.51		$	29.23		$	30.17		$	30.85		$	31.56		$	32.65		$	33.66		$	34.37
Common shares outstanding (in millions)		178.8			176.2			174.8			173.8			173.9			172.6			173.5			174.0			176.1

3/31/2006																			PAGE 15
Consolidating Balance Sheets
Unaudited [Millions of Dollars]
													Investment
	Lincoln Retirement						Life Insurance						Management				Lincoln UK
ASSETS	Mar			Dec			Mar			Dec			Mar		Dec		Mar		Dec
	2006			2005			2006			2005			2006		2005		2006		2005
Investments
Corporate bonds	$	12,348.1		$	12,688.1		$	8,787.8		$	9,038.9		$	527.2	$	515.9	$	629.3	$	646.7
U.S. government bonds		11.1			11.3			87.3			71.0			-		-		-		-
Foreign government bonds		266.9			275.9			173.1			176.6			6.6		6.8		325.7		302.2
Asset/mortgage backed securities		3,225.2			3,277.3			1,856.9			1,901.1			97.1		91.9		-		-
State and municipal bonds		65.6			67.2			41.7			42.7			1.1		1.1		-		-
Preferred stocks-redeemable		63.2			61.2			27.3			28.4			-		-		-		-
Common stocks		2.8			-			0.5			0.0			-		-		43.4		43.0
Preferred stocks-equity		41.7			42.2			14.3			14.2			2.6		2.7		-		-
Total AFS Securities		16,024.7			16,423.1			10,989.0			11,273.0			634.6		618.4		998.4		991.9
Trading Securities		1,098.8			1,130.6			-			-			-		-		-		-
Mortgage loans		1,649.1			1,720.6			1,613.5			1,621.4			42.1		44.1		0.0		0.0
Real estate		-			-			-			-			-		-		0.2		0.2
Policy loans		428.5			431.7			1,427.9			1,426.0			-		-		4.0		4.4
Allocated investments		3,687.7			3,645.9			1,687.2			1,545.0			165.5		159.5		-		-
Other long-term investments		153.1			155.0			2.8			3.3			-		-		-		-
Total Investments		23,041.9			23,507.0			15,720.4			15,868.8			842.3		822.1		1,002.6		996.6
Notes receivable from LNC		361.2			423.3			96.2			56.8			11.1		76.3		-		-
Cash and invested cash		(93.6	)		(113.3	)		(2.2	)		(40.7	)		68.9		95.3		230.1		245.5
Premium and fees receivable		(0.2	)		(0.0	)		15.4			32.3			64.3		56.7		-		-
Accrued investment income		235.6			236.5			194.2			179.2			9.2		8.2		23.0		20.2
Amount recoverable from reinsurers		910.2			937.2			1,299.3			1,273.0			-		-		62.2		59.9
Deferred acquisition costs		1,614.2			1,480.5			2,102.4			1,970.0			166.5		154.5		487.9		486.3
Value of business acquired		73.3			76.0			651.9			665.8			-		-		259.3		257.2
Other intangible assets		139.9			129.4			-			-			11.9		13.9		-		-
Goodwill		64.1			64.1			855.1			855.1			260.8		260.8		14.4		14.3
Other		133.6			183.0			480.8			507.9			144.9		127.3		132.0		113.9
Assets held in separate accounts		51,440.1			48,182.0			2,643.0			2,482.7			6,147.6		5,762.5		7,753.5		7,319.6
Total Assets	$	77,920.5		$	75,105.6		$	24,056.5		$	23,850.9		$	7,727.4	$	7,377.6	$	9,965.0	$	9,513.3
		Corporate and						Consolidating
		Other Operations						Adjustments										Consolidated
ASSETS		Mar			Dec			Mar			Dec							Mar		Dec
		2006			2005			2006			2005							2006		2005
Investments
Corporate bonds	$	3,125.6		$	2,971.1		$	-		$	-						$	25,418.0	$	25,860.7
U.S. government bonds		74.9			79.5			-			-							173.4		161.8
Foreign government bonds		397.3			441.8			-			-							1,169.7		1,203.3
Asset/mortgage backed securities		689.6			680.9			-			-							5,868.8		5,951.2
State and municipal bonds		17.4			17.7			-			-							126.0		128.8
Preferred stocks-redeemable		46.4			47.9			-			-							136.9		137.4
Common stocks		14.2			13.0			-			-							61.0		55.9
Preferred stocks-equity		56.5			29.6			-			-							115.0		88.8
Total AFS Securities		4,421.9			4,281.4			-			-							33,068.8		33,587.9
Trading securities		2,091.3			2,115.4			-			-							3,190.1		3,246.0
Mortgage loans		281.4			276.5			-			-							3,586.2		3,662.6
Real estate		180.2			182.5			-			-							180.4		182.7
Policy loans		-			0.0			-			-							1,860.4		1,862.2
Allocated investments		(5,540.5	)		(5,350.5	)		-			-							-		-
Other long-term investments		531.6			468.6			-			-							687.5		626.9
Total Investments		1,965.9			1,974.0			(0.0	)		(0.0	)						42,573.2		43,168.4
Investments In Consolidated Subs		6,246.2			6,077.7			(6,246.2	)		(6,077.7	)						-		-
Notes receivable from LNC		(408.9	)		(521.6	)		(59.6	)		(34.8	)						-		-
Cash and invested cash		1,770.8			2,124.9			-			-							1,974.0		2,311.7
Premium and fees receivable		283.7			254.3			-			-							363.2		343.2
Accrued investment income		70.1			82.2			-			-							532.1		526.4
Federal income tax recoverable		-			-			67.2			-							67.2		-
Amount recoverable from reinsurers		4,627.7			4,656.2			-			-							6,899.4		6,926.3
Deferred acquisition costs		0.2			1.0			-			-							4,371.2		4,092.2
Value of business acquired		-			-			-			-							984.4		998.9
Other intangible assets		-			-			-			-							151.8		143.3
Goodwill		-			-			-			-							1,194.4		1,194.2
Other		418.7			414.8			(11.2	)		(10.9	)						1,298.7		1,336.1
Assets held in separate accounts		-			-			-			-							67,984.2		63,746.8
Total Assets	$	14,974.3		$	15,063.7		$	(6,249.9	)	$	(6,123.5	)					$	128,393.9	$	124,787.6

3/31/2006																				PAGE 16
Consolidating Balance Sheets
Unaudited [Millions of Dollars]
													Investment
	Lincoln Retirement						Life Insurance						Management				Lincoln UK
LIABILITIES and SHAREHOLDERS' EQUITY	Mar			Dec			Mar			Dec			Mar		Dec		Mar			Dec
	2006			2005			2006			2005			2006		2005		2006			2005
Liabilities
Insurance and Inv Contract Liabilities:
Reserves	$	2,203.3		$	2,251.7		$	16,285.2		$	16,149.7		$	-	$	-	$	1,329.4		$	1,332.0
Unpaid claims		26.5			29.0			134.5			129.5			-		-		45.4			44.8
Unearned premiums		-			-			-			-			-		-		-			-
Premium deposit funds		20,553.3			20,816.8			19.0			17.3			740.1		739.9		30.5			31.9
Participating policyholders' funds		-			-			89.5			111.2			-		-		-			-
Other policyholders' funds		-			-			741.6			741.1			-		-		-			-
Total Insurance and Inv Contract Liabilities		22,783.1			23,097.6			17,269.7			17,148.9			740.1		739.9		1,405.3			1,408.6
Federal income taxes		294.3			284.3			94.5			92.9			17.6		11.8		89.2			86.9
Notes payable to LNC		24.9			0.8			-			-			-		-		-			-
Embedded derivative - modco		19.6			40.5			0.8			2.8			-		-		-			-
Other liabilities		183.1			154.2			433.7			498.8			286.5		308.3		237.7			209.8
Deferred gain on indemnity reinsurance		-			-			-			-			-		-		-			-
Liability related to separate accounts		51,440.1			48,182.0			2,643.0			2,482.7			6,147.6		5,762.5		7,753.5			7,319.6
Total Liabilities		74,745.2			71,759.4			20,441.6			20,226.0			7,191.8		6,822.5		9,485.7			9,025.0
Net unrealized gains (losses) on securities		131.2			274.3			51.4			140.6			0.5		2.1		37.8			45.2
Net gains (losses) on derivatives		(0.8	)		1.2			5.6			5.9			-		-		-			-
Foreign currency translation adjustment		-			-			-			-			-		-		72.0			65.8
Minimum pension liability adjustment		-			-			-			(0.1	)		0.5		0.5		(53.8	)		(53.3	)
Other shareholders' equity		3,044.9			3,070.7			3,557.9			3,478.4			534.7		552.4		423.3			430.6
Shareholders' Equity		3,175.3			3,346.2			3,614.8			3,624.9			535.7		555.1		479.3			488.3
Total Liabilities and Shareholders' Equity	$	77,920.5		$	75,105.6		$	24,056.5		$	23,850.9		$	7,727.4	$	7,377.6	$	9,965.0		$	9,513.3
		Corporate and						Consolidating
		Other Operations						Adjustments										Consolidated
LIABILITIES and SHAREHOLDERS' EQUITY		Mar			Dec			Mar			Dec							Mar			Dec
		2006			2005			2006			2005							2006			2005
Liabilities
Insurance and Inv Contract Liabilities:
Reserves	$	3,916.6		$	3,875.9		$	-		$	-						$	23,734.5		$	23,609.2
Unpaid claims		772.7			837.5			-			-							979.0			1,040.8
Unearned premiums		2.3			2.1			-			-							2.3			2.1
Premium deposit funds		105.7			107.4			-			-							21,448.6			21,713.3
Participating policyholders' funds		-			-			-			-							89.5			111.2
Other policyholders' funds		5.0			5.0			-			-							746.6			746.1
Total Insurance and Inv Contract Liabilities		4,802.3			4,827.8			-			-							47,000.5			47,222.8
Federal income taxes		(562.7	)		(456.2	)		67.1			-							-			19.8
Short-term debt		10.6			119.9			-			-							10.6			119.9
Long-term debt		998.5			999.0			-			-							998.5			999.0
Junior subordinated debentures issued to affiliated trusts		332.3			334.0			-			-							332.3			334.0
Notes payable to LNC		34.7			33.9			(59.6	)		(34.8	)						-			-
Embedded derivative - modco		171.7			248.9			-			-							192.0			292.2
Other liabilities		3,590.9			3,672.6			(11.2	)		(10.9	)						4,720.7			4,832.8
Deferred gain on indemnity reinsurance		816.9			836.0			-			-							816.9			836.0
Liability related to separate accounts		-			-			-			-							67,984.2			63,746.8
Total Liabilities		10,195.2			10,615.9			(3.8	)		(45.7	)						122,055.7			118,403.2
Net unrealized gains (losses) on securities		1.1			35.8			(1.8	)		(1.4	)						220.2			496.6
Gains (losses) on derivatives		30.3			0.2			-			-							35.2			7.3
Foreign currency translation adjustment		10.1			10.1			7.5			7.5							89.7			83.4
Minimum pension liability adjustment		(6.7	)		(6.7	)		-			-							(60.1	)		(59.5	)
Other shareholders' equity		4,744.2			4,408.3			(6,251.8	)		(6,083.9	)						6,053.2			5,856.6
Shareholders' Equity		4,779.1			4,447.8			(6,246.0	)		(6,077.8	)						6,338.2			6,384.4
Total Liabilities and Shareholders' Equity	$	14,974.3		$	15,063.7		$	(6,249.9	)	$	(6,123.5	)					$	128,393.9		$	124,787.6

3/31/2006													PAGE 17
Lincoln Retirement
Income Statements & Operational Data
Unaudited [Millions of Dollars]
For the Year Ended December 31	2001			2002			2003			2004			2005
Operating Revenue
Premiums	$	77.5		$	47.4		$	21.9		$	33.0		$	45.7
Surrender charges		31.2			31.2			28.9			25.0			27.4
Expense assessments		508.6			446.2			441.9			580.5			727.1
Other revenue and fees		16.7			3.3			8.7			(6.3	)		(6.2	)
Net investment income		1,399.1			1,457.5			1,483.7			1,495.9			1,463.9
Total Operating Revenue		2,033.1			1,985.5			1,985.1			2,128.0			2,258.0
Operating Expenses
Benefits paid or provided:
Benefits		263.9			314.1			181.5			189.9			223.0
Interest credited to policy bal.		863.8			903.8			867.7			836.0			819.0
Def. sales inducements net of amortization		(12.1	)		(12.6	)		(14.1	)		(40.6	)		(43.9	)
Total insurance benefits		1,115.7			1,205.3			1,035.1			985.2			998.1
Underwriting, acquisition,
insurance and other expenses:
Commissions and other volume-related expenses		386.0			385.4			386.0			586.7			626.3
Operating and administrative expenses		231.8			231.3			226.2			231.8			259.2
Taxes, licenses and fees		13.7			11.5			17.7			14.6			10.5
Subtotal		631.6			628.2			630.0			833.1			895.9
DAC deferral net of amortization		(103.4	)		(73.6	)		(103.0	)		(247.9	)		(275.8	)
VOBA amortization		14.7			31.8			9.5			20.0			16.6
Total underwriting, acquisition,
insurance and other expenses		542.9			586.3			536.5			605.2			636.7
Goodwill amortization		1.2			-			-			-			-
Total Operating Expenses		1,659.8			1,791.7			1,571.6			1,590.5			1,634.8
Operating income before federal taxes		373.3			193.9			413.5			537.6			623.2
Federal income taxes		57.1			10.5			81.6			123.0			151.7
Income from Operations	$	316.2		$	183.4		$	331.9		$	414.6		$	471.5
Effective tax rate		15.3	%		5.4	%		19.7	%		22.9	%		24.3	%
Average capital	$	1,831.4		$	2,339.6		$	2,400.3		$	2,589.1		$	2,797.1
Return on average capital		17.3	%		7.8	%		13.8	%		16.0	%		16.9	%
Roll Forward of Deferred Acquisition Costs
Balance at beginning of period	$	812.5		$	894.3		$	824.7		$	854.6		$	1,040.4
Deferral		227.8			229.0			223.4			421.9			455.3
Amortization		(124.4	)		(155.4	)		(120.4	)		(174.0	)		(179.5	)
Included in Total Benefits and Expenses		103.4			73.6			103.0			247.9			275.8
Adjustment related to realized (gains) losses
on available-for-sale securities		68.2			73.0			(18.7	)		(28.3	)		(33.5	)
Adjustment related to unrealized (gains) losses
on available-for-sale securities		(90.0	)		(201.3	)		(54.3	)		8.3			197.7
Other*		0.2			(14.8	)								-
Cumulative effect of accounting change		-			-			-			(42.3	)		-
Balance at end of period	$	894.3		$	824.7		$	854.6		$	1,040.4		$	1,480.5
Roll Forward of Value of Business Acquired
Balance at beginning of period	$	169.2		$	154.5		$	122.7		$	113.2		$	92.6
Amortization		(14.7	)		(31.8	)		(9.5	)		(20.0	)		(16.6	)
Cumulative effect of accounting change		-			-			-			(0.6	)		-
Balance at end of period	$	154.5		$	122.7		$	113.2		$	92.6		$	76.0
*Includes the transfer of the Legacy Life block of business to the Life Insurance segment in the first quarter of 2002.

3/31/2006																									PAGE 18
Lincoln Retirement
Income Statements & Operational Data
Unaudited [Millions of Dollars]
For the Quarter Ended	Mar			Jun			Sep			Dec			Mar			Jun			Sep			Dec			Mar
	2004			2004			2004			2004			2005			2005			2005			2005			2006
Operating Revenue
Premiums	$	6.5		$	7.4		$	9.2		$	9.9		$	10.5		$	7.8		$	18.1		$	9.2		$	10.3
Surrender charges		5.9			6.0			6.7			6.4			7.4			6.9			7.3			5.9			7.6
Expense assessments		137.3			140.9			145.2			157.1			164.6			173.1			189.8			199.6			212.3
Other revenue and fees		(0.8	)		(2.1	)		(1.3	)		(2.0	)		(1.4	)		(1.6	)		(1.2	)		(1.9	)		(2.5	)
Net investment income		379.0			382.3			366.5			368.0			357.4			386.8			359.1			360.6			358.9
Total Operating Revenue		528.0			534.4			526.2			539.4			538.5			573.0			573.1			573.3			586.7
Operating Expenses
Benefits paid or provided:
Benefits		54.1			52.0			40.5			43.4			52.4			61.5			59.2			49.9			50.9
Interest credited to policy balances		207.8			208.0			209.9			210.4			204.7			206.4			204.9			202.9			200.6
Def. sales inducements net of amortization		(9.0	)		(9.8	)		(10.4	)		(11.5	)		(9.4	)		(11.7	)		(11.5	)		(11.3	)		(10.5	)
Total insurance benefits		252.8			250.2			240.0			242.2			247.8			256.2			252.5			241.6			241.0
Underwriting, acquisition,
insurance and other expenses:
Commissions and other volume-related expenses		141.8			146.9			141.3			156.7			149.7			153.4			160.4			162.8			173.0
Operating and administrative expenses		51.7			58.1			62.5			59.6			56.8			64.2			68.4			69.8			56.1
Taxes, licenses and fees		5.2			3.7			3.2			2.5			3.9			2.4			2.7			1.5			3.7
Subtotal		198.7			208.7			207.0			218.8			210.4			220.0			231.5			234.0			232.8
DAC deferral net of amortization		(60.4	)		(61.2	)		(77.3	)		(49.0	)		(49.4	)		(64.1	)		(104.4	)		(58.0	)		(56.3	)
VOBA amortization		3.3			2.9			11.5			2.3			2.4			2.4			9.6			2.4			2.7
Total underwriting, acquisition,
insurance and other expenses		141.6			150.4			141.1			172.1			163.3			158.3			136.7			178.4			179.2
Total Operating Expenses		394.4			400.6			381.2			414.3			411.1			414.4			389.2			420.0			420.2
Operating income before federal taxes		133.6			133.8			145.0			125.1			127.4			158.6			183.9			153.4			166.5
Federal income taxes		31.4			32.1			34.9			24.7			28.8			39.2			47.7			36.1			43.3
Income from Operations	$	102.2		$	101.8		$	110.2		$	100.5		$	98.6		$	119.4		$	136.2		$	117.3		$	123.1
Effective tax rate		23.5	%		24.0	%		24.1	%		19.7	%		22.6	%		24.7	%		25.9	%		23.5	%		26.0	%
Average capital	$	2,532.6		$	2,575.1		$	2,560.5		$	2,688.4		$	2,661.3		$	2,718.3		$	2,840.7		$	2,968.0		$	3,057.8
Return on average capital		16.1	%		15.8	%		17.2	%		14.9	%		14.8	%		17.6	%		19.2	%		15.8	%		16.1	%
Roll Forward of Deferred Acquisition Costs
Balance at beginning of period	$	854.6		$	748.7		$	1,056.2		$	984.6		$	1,040.4		$	1,214.0		$	1,174.8		$	1,380.6		$	1,480.5
Deferral		101.9			105.5			101.5			112.9			107.0			112.7			114.4			121.3			125.5
Amortization		(41.5	)		(44.4	)		(24.2	)		(63.9	)		(57.6	)		(48.6	)		(10.0	)		(63.3	)		(69.2	)
Included in Total Benefits and Expenses		60.4			61.2			77.3			49.0			49.4			64.1			104.4			58.0			56.3
Adjustment related to realized (gains) losses
on available-for-sale securities		(10.2	)		(6.0	)		(1.8	)		(10.3	)		(10.1	)		(8.4	)		(8.0	)		(7.0	)		(6.8	)
Adjustment related to unrealized (gains) losses
on available-for-sale securities		(113.9	)		252.4			(147.2	)		17.0			134.2			(94.8	)		109.5			48.9			84.2
Other		-			-
Cumulative effect of accounting change		(42.3	)		-			-			-			-			-			-			-			-
Balance at end of period	$	748.7		$	1,056.2		$	984.6		$	1,040.4		$	1,214.0		$	1,174.8		$	1,380.6		$	1,480.5		$	1,614.2
Roll Forward of Value of Business Acquired
Balance at beginning of period	$	113.2		$	109.4		$	106.4		$	94.9		$	92.6		$	90.3		$	87.9		$	78.3		$	76.0
Amortization		(3.3	)		(2.9	)		(11.5	)		(2.3	)		(2.4	)		(2.4	)		(9.6	)		(2.4	)		(2.7	)
Cumulative effect of accounting change		(0.6	)		-			-			-			-			-			-			-			-
Balance at end of period	$	109.4		$	106.4		$	94.9		$	92.6		$	90.3		$	87.9		$	78.3		$	76.0		$	73.3

3/31/2006													PAGE 19
Lincoln Retirement
Account Value Rollforward
Unaudited [Billions of Dollars]
	2001			2002			2003			2004			2005
Fixed Annuities - Balance at Beginning of Year	$	16.615		$	18.004		$	20.087		$	21.220		$	21.565
Gross Deposits		3.342			3.672			3.125			3.110			2.947
Withdrawals & deaths		(2.448	)		(2.637	)		(2.074	)		(2.227	)		(2.714	)
Net flows		0.894			1.035			1.051			0.884			0.234
Transfer from (to) var annuities		(0.428	)		0.108			(0.817	)		(1.395	)		(1.548	)
Interest credited		0.923			0.940			0.899			0.856			0.838
Fixed Annuities-Gross		18.004			20.087			21.220			21.565			21.089
Reinsurance Ceded		(1.514	)		(2.003	)		(2.353	)		(2.297	)		(2.233	)
Fixed Annuities - Balance at End of Year*	$	16.491		$	18.085		$	18.868		$	19.268		$	18.856
Variable Annuities - Balance at Beginning of Year	$	39.053		$	33.999		$	26.550		$	33.930		$	40.362
Gross Deposits		2.792			2.381			2.505			5.082			6.296
Withdrawals & deaths		(3.905	)		(3.394	)		(3.181	)		(3.797	)		(4.299	)
Net flows		(1.113	)		(1.014	)		(0.676	)		1.285			1.997
Transfer from (to) fixed annuities		0.435			(0.092	)		0.803			1.387			1.559
Invest inc & change in mkt value		(4.376	)		(6.344	)		7.253			3.760			3.683
Var Annuities - Balance at End of Year **	$	33.999		$	26.550		$	33.930		$	40.362		$	47.601
Total Annuities - Balance at Beginning of Year	$	55.668		$	52.003		$	46.637		$	55.150		$	61.927
Gross Deposits		6.134			6.053			5.630			8.192			9.244
Withdrawals & deaths		(6.353	)		(6.032	)		(5.255	)		(6.023	)		(7.013	)
Net flows		(0.219	)		0.021			0.375			2.169			2.231
Transfers		0.007			0.017			(0.014	)		(0.008	)		0.011
Interest credited & change in mkt value		(3.453	)		(5.404	)		8.152			4.616			4.521
Total Gross Annuities- Balance at End of Year		52.003			46.637			55.150			61.927			68.690
Reinsurance Ceded		(1.514	)		(2.003	)		(2.353	)		(2.297	)		(2.233	)
Total Annuities (Net of Ceded) - Balance at End of Year	$	50.490		$	44.634		$	52.797		$	59.629		$	66.457
Alliance Mutual Funds - Balance at Beg of Year***	$	0.375		$	0.639		$	0.888		$	1.856		$	2.861
Gross Deposits		0.275			0.362			0.614			0.828			1.066
Withdrawals & deaths		0.049			0.069			0.019			(0.075	)		(0.410	)
Net flows		0.324			0.432			0.632			0.753			0.656
Transfers		(0.007	)		(0.030	)		0.007			(0.031	)		(0.007	)
Interest credited & change in mkt value		(0.052	)		(0.153	)		0.330			0.282			0.262
Total Alliance Mutual Funds - Balance at End of Year	$	0.639		$	0.888		$	1.856		$	2.861		$	3.772
Total Annuities and Alliance Mutual Funds -
Balance Beginning of Year	$	56.042		$	52.642		$	47.525		$	57.006		$	64.788
Gross Deposits		6.409			6.415			6.244			9.020			10.310
Withdrawals & deaths		(6.304	)		(5.962	)		(5.236	)		(6.098	)		(7.423	)
Net flows		0.105			0.453			1.007			2.922			2.887
Transfers		(0.000	)		(0.013	)		(0.008	)		(0.039	)		0.004
Interest credited & change in mkt value		(3.505	)		(5.558	)		8.482			4.898			4.783
Total Gross Annuities and Alliance - Balance End of Year		52.642			47.525			57.006			64.788			72.462
Reinsurance Ceded		(1.514	)		(2.003	)		(2.353	)		(2.297	)		(2.233	)
Total Annuities and Alliance Mutual Funds
Balance at End of Year - (net of ceded)	$	51.128		$	45.522		$	54.653		$	62.491		$	70.229
Run-off Group Pension Accounts - Not Included above		3.060			2.844			2.947			2.906			2.737
Total Retirement Segment Account Values - (net of ceded)	$	54.189		$	48.367		$	57.600		$	65.397		$	72.966
Var Ann Under Agreement - Included above		0.438			0.298			0.310			0.266			0.216
Incremental Deposits****:
Fixed Annuities Incremental Deposits	$	3.213		$	3.600		$	3.067		$	3.046		$	2.828
Variable Annuities Incremental Deposits		1.985			2.207			2.405			4.928			6.164
Total Annuities Incremental Deposits		5.198			5.807			5.472			7.974			8.992
Total Alliance Mutual Funds Incremental Deposits		0.639			0.362			0.614			0.828			1.066
Total Annuities and Alliance Mutual Funds
Incremental Deposits	$	5.837		$	6.170		$	6.086		$	8.802		$	10.058
* 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.

3/31/2006																															PAGE 20
Lincoln Retirement
Account Value Rollforward
Unaudited [Billions of Dollars]
	Jun			Sep			Dec			Mar			Jun			Sep			Dec			Mar			Jun			Sep			Dec			Mar
	2003			2003			2003			2004			2004			2004			2004			2005			2005			2005			2005			2006
Fixed Annuities - Balance at Beginning of Quarter	$	20.612		$	20.864		$	21.132		$	21.221		$	21.281		$	21.476		$	21.633		$	21.565		$	21.375		$	21.417		$	21.319		$	21.089
Gross Deposits		0.778			0.778			0.792			0.817			0.779			0.783			0.732			0.740			0.793			0.718			0.696			0.693
Withdrawals & deaths		(0.501	)		(0.492	)		(0.557	)		(0.571	)		(0.515	)		(0.554	)		(0.587	)		(0.778	)		(0.632	)		(0.629	)		(0.676	)		(0.712	)
Net flows		0.277			0.286			0.235			0.246			0.264			0.228			0.145			(0.038	)		0.161			0.090			0.021			(0.019	)
Transfer to var annuities		(0.250	)		(0.243	)		(0.369	)		(0.399	)		(0.280	)		(0.287	)		(0.429	)		(0.359	)		(0.329	)		(0.399	)		(0.460	)		(0.446	)
Interest credited		0.226			0.225			0.223			0.213			0.211			0.215			0.216			0.207			0.210			0.212			0.209			0.205
Fixed Annuities - Gross		20.864			21.132			21.221			21.281			21.476			21.633			21.565			21.375			21.417			21.319			21.089			20.829
Reinsurance Ceded		(2.169	)		(2.264	)		(2.353	)		(2.350	)		(2.333	)		(2.316	)		(2.297	)		(2.291	)		(2.277	)		(2.257	)		(2.233	)		(2.202	)
Fixed Annuities - Balance at End of Quarter*	$	18.696		$	18.868		$	18.868		$	18.930		$	19.143		$	19.317		$	19.268		$	19.084		$	19.141		$	19.062		$	18.856		$	18.628
Variable Annuities - Balance at Beginning of Quarter	$	25.402		$	29.121		$	30.185		$	33.930		$	35.457		$	36.064		$	36.268		$	40.362		$	40.510		$	42.319		$	45.059		$	47.601
Gross Deposits		0.468			0.651			0.933			1.156			1.237			1.257			1.433			1.478			1.513			1.585			1.720			1.877
Withdrawals & deaths		(0.759	)		(0.798	)		(0.798	)		(0.930	)		(0.973	)		(0.904	)		(0.990	)		(1.012	)		(1.018	)		(1.136	)		(1.134	)		(1.263	)
Net flows		(0.291	)		(0.147	)		0.135			0.226			0.264			0.352			0.443			0.466			0.495			0.450			0.586			0.615
Transfer from fixed annuities		0.249			0.238			0.361			0.393			0.279			0.288			0.427			0.363			0.333			0.400			0.464			0.445
Invest inc & change in mkt value		3.761			0.973			3.249			0.908			0.064			(0.436	)		3.224			(0.681	)		0.981			1.890			1.493			2.164
Variable Annuities - Balance at End of Quarter **	$	29.121		$	30.185		$	33.930		$	35.457		$	36.064		$	36.268		$	40.362		$	40.510		$	42.319		$	45.059		$	47.601		$	50.825
Total Annuities - Balance at Beginning of Quarter	$	46.014		$	49.985		$	51.318		$	55.151		$	56.738		$	57.540		$	57.901		$	61.927		$	61.885		$	63.736		$	66.378		$	68.690
Gross Deposits		1.247			1.430			1.725			1.973			2.016			2.039			2.164			2.218			2.306			2.304			2.416			2.570
Withdrawals & deaths		(1.261	)		(1.290	)		(1.355	)		(1.501	)		(1.487	)		(1.459	)		(1.576	)		(1.790	)		(1.650	)		(1.764	)		(1.809	)		(1.974	)
Net flows		(0.014	)		0.139			0.370			0.472			0.528			0.581			0.588			0.428			0.657			0.539			0.607			0.596
Transfers		(0.001	)		(0.005	)		(0.008	)		(0.006	)		(0.001	)		0.001			(0.002	)		0.004			0.003			0.000			0.003			(0.001	)
Interest credited & change in mkt value		3.986			1.198			3.472			1.121			0.275			(0.221	)		3.440			(0.474	)		1.191			2.102			1.702			2.369
Total Annuities - Gross		49.985			51.318			55.151			56.738			57.540			57.901			61.927			61.885			63.736			66.378			68.690			71.654
Reinsurance Ceded		(2.169	)		(2.264	)		(2.353	)		(2.350	)		(2.333	)		(2.316	)		(2.297	)		(2.291	)		(2.277	)		(2.257	)		(2.233	)		(2.202	)
Total Annuities (Net of Ceded) - Bal at End of Quarter	$	47.817		$	49.053		$	52.798		$	54.387		$	55.207		$	55.585		$	59.630		$	59.594		$	61.460		$	64.120		$	66.457		$	69.452
Alliance Mutual Funds - Balance at Beginning of Quarter***	$	1.072		$	1.336		$	1.524		$	1.856		$	2.162		$	2.335		$	2.430		$	2.861		$	3.163		$	3.432		$	3.672		$	3.772
Gross Deposits		0.116			0.148			0.154			0.251			0.187			0.167			0.223			0.421			0.222			0.200			0.223			0.318
Withdrawals & deaths		(0.002	)		(0.011	)		0.012			(0.011	)		(0.015	)		(0.032	)		(0.017	)		(0.074	)		(0.022	)		(0.107	)		(0.208	)		(0.056	)
Net flows		0.113			0.138			0.165			0.240			0.172			0.135			0.206			0.347			0.201			0.093			0.014			0.262
Transfers		(0.001	)		0.006			0.004			0.007			(0.013	)		(0.025	)		0.000			0.002			(0.006	)		(0.000	)		(0.003	)		0.005
Interest credited & change in mkt value		0.151			0.045			0.162			0.060			0.013			(0.014	)		0.225			(0.048	)		0.075			0.147			0.088			0.209
Total Alliance Mutual Funds - Balance at End of Quarter	$	1.336		$	1.524		$	1.856		$	2.162		$	2.335		$	2.430		$	2.861		$	3.163		$	3.432		$	3.672		$	3.772		$	4.248
Total Annuities and Alliance Mutual Funds -
Balance at Beginning of Quarter	$	47.086		$	51.321		$	52.842		$	57.007		$	58.900		$	59.875		$	60.331		$	64.788		$	65.048		$	67.168		$	70.050		$	72.462
Gross Deposits		1.363			1.578			1.879			2.223			2.203			2.207			2.387			2.639			2.529			2.504			2.639			2.888
Withdrawals & deaths		(1.263	)		(1.301	)		(1.343	)		(1.512	)		(1.503	)		(1.490	)		(1.593	)		(1.863	)		(1.671	)		(1.871	)		(2.018	)		(2.030	)
Net flows		0.099			0.277			0.536			0.712			0.701			0.716			0.794			0.776			0.857			0.633			0.621			0.858
Transfers		(0.002	)		0.001			(0.004	)		0.001			(0.014	)		(0.024	)		(0.002	)		0.006			(0.003	)		0.000			0.000			0.005
Interest credited & change in mkt value		4.137			1.243			3.634			1.181			0.288			(0.235	)		3.665			(0.522	)		1.266			2.249			1.790			2.578
Total Gross Annuities and Alliance Mutual Funds -
Balance at End of Quarter		51.321			52.842			57.007			58.900			59.875			60.331			64.788			65.048			67.168			70.050			72.462			75.902
Reinsurance Ceded		(2.169	)		(2.264	)		(2.353	)		(2.350	)		(2.333	)		(2.316	)		(2.297	)		(2.291	)		(2.277	)		(2.257	)		(2.233	)		(2.202	)
Total Annuities and Alliance Mutual Funds
Balance at End of Quarter (net of ceded)	$	49.152		$	50.577		$	54.654		$	56.550		$	57.542		$	58.016		$	62.491		$	62.757		$	64.892		$	67.793		$	70.229		$	73.700
Run-off Group Pension Accounts - Not Included Above		2.888			2.888			2.947			2.943			2.910			2.857			2.906			2.886			2.883			2.877			2.737			2.753
Total Retirement Segment Account Values - (net of ceded)	$	52.040		$	53.466		$	57.601		$	59.493		$	60.452		$	60.872		$	65.397		$	65.643		$	67.775		$	70.669		$	72.966		$	76.453
Var Ann Under Agreement - Included above		0.301			0.296			0.310			0.301			0.283			0.261			0.266			0.244			0.232			0.226			0.216			0.208
Incremental Deposits****:
Fixed Annuities Incremental Deposits	$	0.768		$	0.767		$	0.779		$	0.795		$	0.767		$	0.767		$	0.718		$	0.719		$	0.779		$	0.689		$	0.642		$	0.680
Variable Annuities Incremental Deposits		0.444			0.628			0.899			1.120			1.194			1.212			1.402			1.443			1.476			1.558			1.687			1.851
Total Annuities Incremental Deposits		1.212			1.394			1.679			1.914			1.961			1.979			2.120			2.162			2.256			2.247			2.328			2.531
Total Alliance Mutual Funds Incremental Deposits		0.116			0.148			0.154			0.251			0.187			0.167			0.223			0.421			0.222			0.200			0.223			0.318
Total Annuities and Alliance Mutual Funds Incremental Deposits	$	1.328		$	1.543		$	1.833		$	2.165		$	2.148		$	2.146		$	2.342		$	2.582		$	2.478		$	2.447		$	2.551		$	2.849
* 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.

3/31/2006													PAGE 21
Lincoln Retirement
Account Values
Unaudited [Billions of Dollars]
	2001			2002			2003			2004			2005
Fixed Annuities - excluding fixed portion of variable contracts
Deposits	$	1.712		$	1.844		$	1.415		$	1.026		$	0.681
Withdrawals		(1.604	)		(1.473	)		(0.934	)		(1.119	)		(1.456	)
Net Flows	$	0.108		$	0.371		$	0.481		$	(0.093	)	$	(0.776	)
Gross Fixed Contract Account Values				$	10.475		$	11.440		$	11.820		$	11.519
Reinsurance Ceded					(2.003	)		(2.353	)		(2.297	)		(2.233	)
Net Fixed Contract Account Values				$	8.473		$	9.087		$	9.522		$	9.286
Fixed Portion of Variable Contracts
Deposits	$	1.630		$	1.828		$	1.710		$	2.085		$	2.267
Withdrawals		(0.844	)		(1.164	)		(1.140	)		(1.108	)		(1.257	)
Net Flows	$	0.786		$	0.664		$	0.570		$	0.977		$	1.010
Fixed Portion of Variable Contract Account Values				$	9.612		$	9.781		$	9.746		$	9.570
Variable Annuities - including fixed portion of variable contracts
Deposits	$	4.422		$	4.208		$	4.215		$	7.166		$	8.563
Withdrawals		(4.748	)		(4.558	)		(4.320	)		(4.904	)		(5.556	)
Net Flows	$	(0.326	)	$	(0.350	)	$	(0.106	)	$	2.262		$	3.007
Variable Contract Account Values				$	36.162		$	43.711		$	50.108		$	57.171
Average Daily Variable Annuity Account Values	$	35.054		$	30.026		$	29.002		$	36.018		$	42.816
Alliance Mutual Funds Contracts
Deposits	$	0.275		$	0.362		$	0.614		$	0.828		$	1.066
Withdrawals		0.049			0.069			0.019			(0.075	)		(0.410	)
Net Flows	$	0.324		$	0.432		$	0.632		$	0.753		$	0.656
Alliance Mutual Funds Contract Account Values*	$	0.639		$	0.888		$	1.856		$	2.861		$	3.772
Average Daily Alliance Mutual Funds Acct Vals*	$	0.519		$	0.800		$	1.371		$	2.304		$	3.401
* 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)		7.38	%		6.98	%		6.41	%		6.28	%		6.07	%
Interest credited to policyholders		5.33	%		4.87	%		4.25	%		3.92	%		3.81	%
Spread (2) (3)		2.05	%		2.11	%		2.16	%		2.37	%		2.26	%
(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 8 bps in 2005, 20 bps in 2004, 6 bps in 2003 and 7 bps in 2002.
(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 the full year.

3/31/2006																															PAGE 22
Lincoln Retirement
Account Values
Unaudited [Billions of Dollars]
	Jun			Sep			Dec			Mar			Jun			Sep			Dec			Mar			Jun			Sep			Dec			Mar
	2003			2003			2003			2004			2004			2004			2004			2005			2005			2005			2005			2006
Fixed Annuities - excluding fixed portion of variable contracts
Deposits	$	0.356		$	0.344		$	0.347		$	0.365		$	0.249		$	0.220		$	0.192		$	0.198		$	0.180		$	0.145		$	0.158		$	0.162
Withdrawals		(0.235	)		(0.238	)		(0.253	)		(0.269	)		(0.261	)		(0.286	)		(0.302	)		(0.454	)		(0.303	)		(0.326	)		(0.374	)		(0.376	)
Net Flows	$	0.121		$	0.106		$	0.094		$	0.096		$	(0.013	)	$	(0.066	)	$	(0.110	)	$	(0.256	)	$	(0.123	)	$	(0.182	)	$	(0.216	)	$	(0.214	)
Gross Fixed Contract Account Values	$	11.001		$	11.226		$	11.440		$	11.649		$	11.755		$	11.811		$	11.820		$	11.684		$	11.681		$	11.618		$	11.519		$	11.421
Reinsurance Ceded		(2.169	)		(2.264	)		(2.353	)		(2.350	)		(2.333	)		(2.316	)		(2.297	)		(2.291	)		(2.277	)		(2.257	)		(2.233	)		(2.202	)
Net Fixed Contract Account Values	$	8.832		$	8.962		$	9.087		$	9.299		$	9.422		$	9.495		$	9.522		$	9.392		$	9.404		$	9.360		$	9.286		$	9.219
Fixed Portion of Variable Contracts
Deposits	$	0.422		$	0.434		$	0.445		$	0.452		$	0.530		$	0.563		$	0.540		$	0.541		$	0.613		$	0.574		$	0.539		$	0.531
Withdrawals		(0.266	)		(0.254	)		(0.304	)		(0.302	)		(0.253	)		(0.268	)		(0.284	)		(0.324	)		(0.329	)		(0.302	)		(0.302	)		(0.335	)
Net Flows	$	0.156		$	0.180		$	0.141		$	0.151		$	0.277		$	0.294		$	0.255		$	0.218		$	0.284		$	0.271		$	0.237		$	0.195
Fixed Portion of Variable Contract Account Values	$	9.864		$	9.906		$	9.781		$	9.631		$	9.721		$	9.822		$	9.746		$	9.691		$	9.736		$	9.702		$	9.570		$	9.409
Variable Annuities - including fixed portion of variable contracts
Deposits	$	0.891		$	1.086		$	1.378		$	1.608		$	1.767		$	1.819		$	1.972		$	2.020		$	2.126		$	2.159		$	2.258		$	2.408
Withdrawals		(1.026	)		(1.052	)		(1.102	)		(1.232	)		(1.226	)		(1.172	)		(1.274	)		(1.336	)		(1.347	)		(1.438	)		(1.436	)		(1.598	)
Net Flows	$	(0.135	)	$	0.034		$	0.276		$	0.376		$	0.541		$	0.647		$	0.698		$	0.684		$	0.780		$	0.721		$	0.823		$	0.810
Variable Contract Account Values	$	38.985		$	40.091		$	43.711		$	45.088		$	45.785		$	46.090		$	50.108		$	50.202		$	52.056		$	54.760		$	57.171		$	60.233
Average Daily Variable Annuity Account Values	$	27.933		$	30.016		$	32.158		$	35.116		$	35.354		$	35.334		$	38.269		$	40.378		$	41.010		$	44.099		$	45.828		$	49.521
Alliance Mutual Fund Contracts
Deposits	$	0.116		$	0.148		$	0.154		$	0.251		$	0.187		$	0.167		$	0.223		$	0.421		$	0.222		$	0.200		$	0.223		$	0.318
Withdrawals		(0.002	)		(0.011	)		0.012			(0.011	)		(0.015	)		(0.032	)		(0.017	)		(0.074	)		(0.022	)		(0.107	)		(0.208	)		(0.056	)
Net Flows	$	0.113		$	0.138		$	0.165		$	0.240		$	0.172		$	0.135		$	0.206		$	0.347		$	0.201		$	0.093		$	0.014		$	0.262
Alliance Mutual Funds Contract Account Values *	$	1.336		$	1.524		$	1.856		$	2.162		$	2.335		$	2.430		$	2.861		$	3.163		$	3.432		$	3.672		$	3.772		$	4.248
Average Alliance Mutual Funds Account Values*	$	1.262		$	1.474		$	1.739		$	2.044		$	2.211		$	2.341		$	2.620		$	3.038		$	3.270		$	3.592		$	3.728		$	4.032
* 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)		6.49	%		6.42	%		6.13	%		6.43	%		6.34	%		6.14	%		6.23	%		6.05	%		6.06	%		6.04	%		6.13	%		6.19	%
Interest credited to policyholders		4.29	%		4.20	%		4.09	%		3.97	%		3.93	%		3.90	%		3.87	%		3.82	%		3.81	%		3.80	%		3.79	%		3.78	%
Spread (2)(3)		2.20	%		2.22	%		2.04	%		2.46	%		2.41	%		2.24	%		2.36	%		2.23	%		2.25	%		2.24	%		2.34	%		2.40	%
(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 13 bps in the 1st quarter of 2006, 11 bps in the 4th quarter of 2005, 4 bps in the 3rd quarter of 2005, 9 bps in the 2nd quarter of 2005, 8 bps in the 1st quarter of 2005, 17 bps in the 4th quarter of 2004, 19 bps in the 3rd quarter of 2004, 38 bps in the 2nd quarter of 2004 and 7 bps in the first quarter of 2004.
(3) 1st quarter 2004 includes income from contingent interest received, which contributed $13 million to net investment income or 27 bps to the yield and spread.

3/31/2006													PAGE 23
Life Insurance Segment
Income Statements
Unaudited [Millions of Dollars]
For the Year Ended December 31	2001			2002			2003			2004			2005
Operating Revenue
Premiums	$	212.4		$	203.8		$	194.9		$	194.0		$	198.7
Surrender charges		66.1			54.1			53.6			51.8			43.6
Mortality assessments		499.4			501.5			516.7			518.7			533.6
Expense assessments		191.4			199.5			201.8			208.6			213.1
Other revenue and fees		17.9			23.7			28.0			31.4			34.0
Net investment income		910.2			899.1			911.1			948.4			970.7
Total Operating Revenue		1,897.5			1,881.7			1,906.1			1,952.9			1,993.5
Operating Expenses
Benefits paid or provided:
Benefits		418.6			427.4			416.0			404.0			422.4
Div accum & div to policyholders		78.5			76.0			81.6			77.4			77.7
Interest credited to policy bal.		569.9			598.6			598.2			579.7			590.2
Total insurance benefits		1,067.0			1,101.9			1,095.8			1,061.2			1,090.3
Underwriting, acquisition,
insurance and other expenses:
Commissions and other volume-related expenses		318.4			330.2			350.1			331.1			362.6
Operating and administrative expenses		166.8			162.2			166.2			168.6			176.4
Taxes, licenses and fees		49.2			53.2			62.2			49.1			53.9
Subtotal		534.5			545.6			578.5			548.9			592.9
DAC deferral net of amortization		(229.8	)		(230.7	)		(235.2	)		(152.2	)		(191.9	)
VOBA amortization		75.9			73.9			81.4			82.2			60.6
Total underwriting, acquisition,
insurance and other expenses		380.5			388.8			424.7			478.9			461.6
Goodwill amortization		23.7			-			-			-			-
Total Operating Expenses		1,471.2			1,490.8			1,520.6			1,540.0			1,551.9
Operating income before federal taxes		426.3			390.9			385.5			412.9			441.6
Federal income taxes		151.0			121.9			120.9			132.6			142.7
Income from Operations	$	275.3		$	269.0		$	264.5		$	280.3		$	298.9
Effective Tax Rate		35.4	%		31.2	%		31.4	%		32.1	%		32.3	%
Average capital	$	2,734.4		$	2,846.3		$	2,849.9		$	3,036.1		$	3,415.4
Return on average capital		10.1	%		9.4	%		9.3	%		9.2	%		8.8	%
Roll Forward of Deferred Acquisition Costs
Balance at beginning of period	$	1,079.3		$	1,265.7		$	1,424.5		$	1,578.3		$	1,691.9
Deferral		324.8			336.5			370.8			365.2			396.9
Amortization		(95.0	)		(105.8	)		(135.5	)		(213.0	)		(205.0	)
Included in Total Operating Expenses		229.8			230.7			235.2			152.2			191.9
Adjustment related to realized (gains) losses
on available-for-sale securities		43.0			39.7			(31.9	)		(16.1	)		(14.6	)
Adjustment related to unrealized (gains) losses
on available-for-sale securities		(89.0	)		(130.9	)		(49.5	)		(25.6	)		100.7
Other*		2.5			19.3			-			3.2			-
Balance at end of period	$	1,265.7		$	1,424.5		$	1,578.3		$	1,691.9		$	1,970.0
Roll Forward of Value of Business Acquired
Balance at beginning of period	$	1,040.5		$	963.9		$	890.0		$	808.6		$	726.5
Amortization		(75.9	)		(73.9	)		(81.4	)		(82.2	)		(60.6	)
Other		(0.7	)		-			-			-			-
Balance at end of period	$	963.9		$	890.0		$	808.6		$	726.5		$	665.8
Roll Forward of Deferred Front-End Loads**
Balance at beginning of period	$	133.0		$	179.7		$	228.6		$	292.7		$	326.6
Deferral		74.1			85.8			92.1			98.0			84.9
Amortization		(27.4	)		(37.0	)		(27.9	)		(64.1	)		(50.9	)
Included in Income from Operations		46.7			48.9			64.1			33.9			33.9
Balance at end of period	$	179.7		$	228.6		$	292.7		$	326.6		$	360.5
*Includes the transfer of the Legacy Life block of business from the Lincoln Retirement segment in the first quarter of 2002. 2004 reflects the DAC unlocking resulting from the implementation of SOP 03-1.
** Included in Insurance and Investment Contract Liabilities on the Balance Sheet.

3/31/2006																									PAGE 24
Life Insurance Segment
Income Statements
Unaudited [Millions of Dollars]
For the Quarter Ended	Mar			Jun			Sep			Dec			Mar			Jun			Sep			Dec			Mar
	2004			2004			2004			2004			2005			2005			2005			2005			2006
Operating Revenue
Premiums	$	47.9		$	48.3		$	44.3		$	53.6		$	45.6		$	47.9		$	47.5		$	57.8		$	51.2
Surrender charges		13.8			12.7			11.1			14.2			12.0			9.1			10.8			11.6			10.3
Mortality assessments		128.5			129.6			130.1			130.5			133.3			132.7			129.8			137.8			138.4
Expense assessments		49.8			51.0			49.8			58.0			48.8			50.2			51.8			62.3			52.8
Other revenue and fees		7.8			8.2			7.3			8.1			8.2			8.2			8.6			8.9			8.7
Net investment income		235.7			234.9			238.4			239.4			236.3			249.2			244.1			241.2			253.6
Total Operating Revenue		483.4			484.8			481.1			503.7			484.2			497.3			492.4			519.6			515.0
Operating Expenses
Benefits paid or provided:
Benefits		97.4			104.4			95.8			106.4			97.4			105.0			117.9			102.0			107.5
Div accum & div to policyholders		18.5			18.6			16.7			23.6			18.4			18.4			17.3			23.6			17.4
Interest credited to policy bal.		144.8			143.9			143.8			147.1			145.8			145.2			149.0			150.2			150.1
Total insurance benefits		260.7			267.0			256.3			277.2			261.6			268.6			284.3			275.8			275.0
Underwriting, acquisition,
insurance and other expenses:
Commissions and other-volume related expenses		78.0			73.0			80.7			99.4			77.2			83.5			92.6			109.2			87.4
Operating and administrative expenses		38.5			40.7			46.5			42.9			40.7			42.2			50.3			43.3			35.0
Taxes, licenses and fees		12.4			11.5			12.8			12.5			14.7			12.5			11.9			14.7			15.2
Subtotal		128.9			125.2			140.0			154.7			132.6			138.2			154.8			167.3			137.5
DAC deferral net of amortization		(35.0	)		(37.3	)		(25.9	)		(54.0	)		(25.2	)		(34.0	)		(76.6	)		(56.1	)		(35.9	)
VOBA amortization		18.5			17.5			29.8			16.4			15.5			12.5			18.9			13.8			13.9
Total underwriting, acquisition,
insurance and other expenses		112.4			105.4			144.0			117.1			122.9			116.7			97.1			124.9			115.6
Total Operating Expenses		373.1			372.4			400.3			394.3			384.5			385.3			381.3			400.8			390.6
Operating income before federal taxes		110.3			112.4			80.7			109.5			99.7			112.0			111.1			118.8			124.4
Federal income taxes		35.5			36.2			25.4			35.5			32.0			36.2			36.0			38.6			42.2
Income from Operations	$	74.8		$	76.2		$	55.4		$	74.0		$	67.7		$	75.8		$	75.1		$	80.2		$	82.2
Effective Tax Rate		32.2	%		32.2	%		31.4	%		32.4	%		32.1	%		32.3	%		32.4	%		32.5	%		33.9	%
Average capital	$	2,927.4		$	2,993.5		$	3,086.4		$	3,137.0		$	3,300.3		$	3,417.8		$	3,432.9		$	3,510.7		$	3,518.1
Return on average capital		10.2	%		10.2	%		7.2	%		9.4	%		8.2	%		8.9	%		8.8	%		9.1	%		9.3	%
Roll Forward of Deferred Acquisition Costs
Balance at beginning of period	$	1,578.3		$	1,534.8		$	1,734.8		$	1,646.4		$	1,691.9		$	1,786.7		$	1,714.8		$	1,884.1		$	1,970.0
Deferral		83.7			81.1			90.8			109.7			85.0			91.1			102.0			118.9			95.8
Amortization		(48.7	)		(43.8	)		(64.9	)		(55.7	)		(59.8	)		(57.0	)		(25.3	)		(62.8	)		(59.9	)
Included in Total Operating Expenses		35.0			37.3			25.9			54.0			25.2			34.0			76.6			56.1			35.9
Adjustment related to realized (gains) losses
on available-for-sale securities		(3.8	)		(2.4	)		(4.8	)		(5.0	)		(2.0	)		(5.9	)		(5.4	)		(1.3	)		(3.7	)
Adjustment related to unrealized (gains) losses
on available-for-sale securities		(77.6	)		165.0			(109.3	)		(3.7	)		71.6			(100.1	)		98.1			31.1			100.2
Other*		3.0			0.2			(0.1	)		0.2			-			-			-			-			-
Balance at end of period	$	1,534.8		$	1,734.8		$	1,646.4		$	1,691.9		$	1,786.7		$	1,714.8		$	1,884.1		$	1,970.0		$	2,102.4
Roll Forward of Value of Business Acquired
Balance at beginning of period	$	808.6		$	790.1		$	772.6		$	742.8		$	726.5		$	710.9		$	698.5		$	679.6		$	665.8
Amortization		(18.5	)		(17.5	)		(29.8	)		(16.4	)		(15.5	)		(12.5	)		(18.9	)		(13.8	)		(13.9	)
Balance at end of period	$	790.1		$	772.6		$	742.8		$	726.5		$	710.9		$	698.5		$	679.6		$	665.8		$	651.9
Roll Forward of Deferred Front-End Loads**
Balance at beginning of period	$	292.7		$	301.5		$	312.2		$	316.4		$	326.6		$	327.9		$	331.5		$	355.4		$	360.5
Deferral		22.8			24.1			23.8			27.3			21.1			20.9			19.9			23.0			20.7
Amortization		(14.0	)		(13.4	)		(19.6	)		(17.1	)		(19.7	)		(17.3	)		4.0			(17.9	)		(18.0	)
Included in Income from Operations		8.9			10.7			4.2			10.2			1.4			3.6			23.9			5.1			2.7
Balance at end of period	$	301.5		$	312.2		$	316.4		$	326.6		$	327.9		$	331.5		$	355.4		$	360.5		$	363.2
*First quarter of 2004 reflects the DAC unlocking resulting from the implementation of SOP 03-1.
** Included in Insurance and Investment Contract Liabilities on the Balance Sheet

3/31/2006									PAGE 25
Life Insurance Segment
Operational Data
Unaudited [Millions of Dollars]
For the Year Ended December 31	2001		2002		2003		2004		2005
First Year Premiums by Product (Millions)
Universal Life
Excluding MoneyGuard	$	184.7	$	356.9	$	417.0	$	401.1	$	438.4
MoneyGuard		107.9		138.4		224.7		244.5		226.0
Total		292.7		495.3		641.6		645.6		664.4
Variable Universal Life		228.6		134.5		79.4		84.8		106.6
Whole Life		26.3		30.3		34.4		41.2		40.7
Term		30.8		32.3		40.2		41.0		33.8
Total Retail		578.4		692.3		795.7		812.6		845.4
Corporate Owned Life Insurance (COLI)		47.3		88.1		125.6		73.7		70.5
Total	$	625.6	$	780.4	$	921.3	$	886.2	$	915.9
First Year Premiums by Distribution (Millions)
Lincoln Financial Advisors	$	196.1	$	201.7	$	223.5	$	209.3	$	183.1
Lincoln Financial Distributors		413.0		556.3		631.9		623.7		676.2
Other*		16.6		22.4		65.8		53.2		56.6
Total by Distribution	$	625.6	$	780.4	$	921.3	$	886.2	$	915.9
Life Insurance In-Force (Billions)
Universal Life & Other	$	121.168	$	126.016	$	129.623	$	132.120	$	136.519
Term Insurance		113.226		127.880		151.717		172.459		187.850
Total Life Segment In-Force	$	234.394	$	253.896	$	281.340	$	304.579	$	324.369

For the Quarter Ended	Jun		Sep		Dec		Mar		Jun		Sep		Dec		Mar		Jun		Sep		Dec		Mar
	2003		2003		2003		2004		2004		2004		2004		2005		2005		2005		2005		2006
First Year Premiums by Product (Millions)
Universal Life
Excluding      MoneyGuard	$	93.8	$	114.2	$	124.5	$	95.7	$	100.7	$	90.1	$	114.5	$	87.1	$	104.1	$	102.9	$	144.4	$	108.6
MoneyGuard		48.9		58.2		71.4		56.2		61.1		60.7		66.6		49.4		53.4		60.7		62.5		51.5
Total		142.7		172.3		195.9		151.9		161.8		150.8		181.1		136.4		157.4		163.6		206.9		160.1
Variable Universal Life		14.1		16.6		24.4		22.5		17.7		17.2		27.5		25.9		23.8		23.4		33.4		27.1
Whole Life		7.1		8.5		12.3		10.8		7.6		9.7		13.1		7.8		8.3		10.2		14.4		8.3
Term		9.6		10.5		10.9		10.5		10.6		10.4		9.4		9.2		8.6		8.0		8.0		8.3
Total Retail		173.5		208.0		243.5		195.6		197.8		188.1		231.2		179.3		198.1		205.3		262.6		203.7
Corporate Owned Life Insurance (COLI)		61.8		23.7		29.6		14.2		9.9		29.2		20.4		24.8		10.2		22.3		13.1		19.6
Total	$	235.3	$	231.7	$	273.1	$	209.8	$	207.6	$	217.3	$	251.5	$	204.1	$	208.4	$	227.6	$	275.8	$	223.4
First Year Premiums by Distribution (Millions)
Lincoln Financial Advisors	$	46.8	$	66.2	$	68.5	$	47.7	$	47.2	$	48.2	$	66.1	$	43.1	$	44.3	$	45.6	$	50.1	$	41.5
Lincoln Financial Distributors		148.3		156.8		195.2		151.4		152.9		152.0		167.4		149.7		153.5		173.0		200.0		158.2
Other*		40.2		8.7		9.4		10.6		7.5		17.1		18.0		11.3		10.6		9.0		25.7		23.7
Total by Distribution	$	235.3	$	231.7	$	273.1	$	209.8	$	207.6	$	217.3	$	251.5	$	204.1	$	208.4	$	227.6	$	275.8	$	223.4
Insurance In-Force (Billions)
Universal Life & Other	$	127.276	$	127.855	$	129.623	$	129.669	$	130.294	$	130.989	$	132.120	$	132.436	$	133.347	$	134.483	$	136.519	$	137.562
Term Insurance		139.191		145.480		151.717		157.338		162.953		167.979		172.459		176.541		180.659		184.334		187.850		191.825
Total Segment In-Force	$	266.467	$	273.335	$	281.340	$	287.007	$	293.247	$	298.967	$	304.579	$	308.976	$	314.005	$	318.817	$	324.369	$	329.388
*Other consists of distribution arrangements with third-party intermediaries.

3/31/2006													PAGE 26
Life Insurance Segment
Life Insurance Account Value Rollforward
Unaudited [Billions of Dollars]
	2001			2002			2003			2004			2005
Universal Life-Bal Beg-of-Year	$	6.976		$	7.508		$	8.211		$	9.030		$	9.648
Deposits		1.043			1.332			1.532			1.433			1.432
Withdrawals & deaths		(0.319	)		(0.426	)		(0.437	)		(0.474	)		(0.422	)
Net flows		0.724			0.906			1.095			0.959			1.010
Policyholder assessments		(0.598	)		(0.648	)		(0.702	)		(0.753	)		(0.804	)
Interest credited		0.405			0.428			0.427			0.413			0.418
Acq of new business/transfers between segments		-			0.018			-			-			-
Universal Life-Bal End of Year (1)	$	7.508		$	8.211		$	9.030		$	9.648		$	10.271
Variable Universal Life-Bal Beg-of-Year	$	1.808		$	1.746		$	1.690		$	2.195		$	2.520
Deposits		0.584			0.504			0.448			0.560			0.535
Withdrawals & deaths		(0.251	)		(0.193	)		(0.208	)		(0.315	)		(0.242	)
Net flows		0.332			0.311			0.240			0.245			0.294
Policyholder assessments		(0.170	)		(0.186	)		(0.191	)		(0.194	)		(0.202	)
Invest inc & chg in mkt value		(0.225	)		(0.313	)		0.457			0.273			0.249
Acq of new business/transfers between segments		-			0.132			-			-			-
Variable Universal Life -Bal end of year	$	1.746		$	1.690		$	2.195		$	2.520		$	2.861
Interest Sensitive Whole Life - Bal Beg-of-Year	$	2.062		$	2.123		$	2.186		$	2.195		$	2.214
Deposits		0.307			0.301			0.279			0.250			0.272
Withdrawals & deaths		(0.200	)		(0.199	)		(0.236	)		(0.207	)		(0.220	)
Net flows		0.107			0.103			0.043			0.043			0.052
Policyholder assessments		(0.164	)		(0.167	)		(0.159	)		(0.149	)		(0.176	)
Interest credited		0.118			0.127			0.125			0.126			0.146
Int Sensitive Whole Life-Bal End -of -Year	$	2.123		$	2.186		$	2.195		$	2.214		$	2.236
Total Segment- Life Insurance Account Values
Bal Beg-of-Year	$	10.847		$	11.377		$	12.086		$	13.420		$	14.382
Deposits		1.934			2.138			2.259			2.243			2.240
Withdrawals & deaths		(0.771	)		(0.818	)		(0.881	)		(0.996	)		(0.884	)
Net flows		1.163			1.320			1.377			1.247			1.356
Policyholder assessments		(0.931	)		(1.002	)		(1.053	)		(1.096	)		(1.182	)
Invest inc & change in market value		0.299			0.241			1.009			0.812			0.813
Acq of new business/transfers between segments		-			0.150			-			-			-
Total Segment -Bal end of year	$	11.377		$	12.086		$	13.420		$	14.382		$	15.368
Life Product Spread Information (2)
Interest Sensitive Products
Net investment income (3)(4)		7.63	%		7.30	%		6.97	%		6.67	%		6.32	%
Interest credited to policyholders		5.86	%		5.77	%		5.36	%		4.85	%		4.69	%
Spread (3)(4)		1.77	%		1.53	%		1.61	%		1.81	%		1.63	%
Traditional Products
Net investment income (3)(4)		7.49	%		7.42	%		6.99	%		6.90	%		6.43	%
(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 2001, 2002, 2003, 2004 and 2005, interest sensitive products represented 86%, 87%, 88%, 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 7 bps in 2005, 20 bps in 2004, 3 bps in 2003, 4 bps in 2002, and 6 bps in 2001. The impact for traditional products was 6 bps in 2005, 18 bps in 2004, 6 bpsin 2003, 5 bps in 2002, and 13 bps in 2001.
(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.

3/31/2006																															PAGE 27
Life Insurance Segment
Life Insurance Account Value Roll Forward
Unaudited [Billions of Dollars]
	Jun			Sep			Dec			Mar			Jun			Sep			Dec			Mar			Jun			Sep			Dec			Mar
	2003			2003			2003			2004			2004			2004			2004			2005			2005			2005			2005			2006
Universal Life-Bal Beg-of-Quarter	$	8.359		$	8.542		$	8.782		$	9.030		$	9.175		$	9.308		$	9.444		$	9.648		$	9.764		$	9.902		$	10.053		$	10.271
Deposits		0.350			0.426			0.440			0.342			0.345			0.333			0.413			0.321			0.333			0.349			0.429			0.353
Withdrawals & deaths		(0.101	)		(0.117	)		(0.113	)		(0.117	)		(0.128	)		(0.112	)		(0.117	)		(0.115	)		(0.101	)		(0.103	)		(0.105	)		(0.116	)
Net flows		0.249			0.309			0.327			0.225			0.217			0.221			0.296			0.207			0.233			0.246			0.324			0.236
Policyholder assessments		(0.171	)		(0.178	)		(0.185	)		(0.183	)		(0.187	)		(0.188	)		(0.196	)		(0.194	)		(0.198	)		(0.200	)		(0.213	)		(0.214	)
Interest credited		0.106			0.108			0.106			0.103			0.102			0.103			0.105			0.103			0.103			0.105			0.107			0.106
Universal Life-Bal End-of-Quarter (1)	$	8.542		$	8.782		$	9.030		$	9.175		$	9.308		$	9.444		$	9.648		$	9.764		$	9.902		$	10.053		$	10.271		$	10.400
Variable Universal Life-Bal Beg of Quarter	$	1.689		$	1.930		$	1.991		$	2.195		$	2.249		$	2.277		$	2.275		$	2.520		$	2.500		$	2.587		$	2.734		$	2.861
Deposits		0.114			0.093			0.123			0.106			0.108			0.156			0.192			0.130			0.131			0.138			0.136			0.133
Withdrawals & deaths		(0.050	)		(0.048	)		(0.074	)		(0.073	)		(0.042	)		(0.089	)		(0.111	)		(0.069	)		(0.062	)		(0.065	)		(0.045	)		(0.066	)
Net flows		0.064			0.045			0.049			0.032			0.066			0.067			0.081			0.061			0.068			0.073			0.091			0.067
Policyholder assessments		(0.048	)		(0.046	)		(0.049	)		(0.048	)		(0.048	)		(0.048	)		(0.050	)		(0.049	)		(0.049	)		(0.050	)		(0.054	)		(0.052	)
Invest inc & chg in mkt value		0.225			0.062			0.204			0.070			0.011			(0.021	)		0.214			(0.031	)		0.067			0.125			0.089			0.152
Variable Universal Life -Bal End-of-Quarter	$	1.930		$	1.991		$	2.195		$	2.249		$	2.277		$	2.275		$	2.520		$	2.500		$	2.587		$	2.734		$	2.861		$	3.028
Interest Sensitive Whole Life - Bal Beg-of-Quarter	$	2.185		$	2.191		$	2.185		$	2.195		$	2.182		$	2.185		$	2.193		$	2.214		$	2.201		$	2.202		$	2.213		$	2.236
Deposits		0.062			0.067			0.098			0.054			0.055			0.059			0.082			0.061			0.062			0.066			0.083			0.049
Withdrawals & deaths		(0.050	)		(0.066	)		(0.073	)		(0.063	)		(0.047	)		(0.047	)		(0.050	)		(0.068	)		(0.055	)		(0.048	)		(0.048	)		(0.056	)
Net flows		0.012			0.001			0.026			(0.009	)		0.008			0.012			0.032			(0.007	)		0.007			0.018			0.035			(0.006	)
Policyholder assessments		(0.038	)		(0.039	)		(0.047	)		(0.036	)		(0.036	)		(0.036	)		(0.041	)		(0.045	)		(0.043	)		(0.043	)		(0.045	)		(0.038	)
Interest credited		0.032			0.032			0.031			0.032			0.031			0.032			0.030			0.039			0.037			0.036			0.034			0.034
Int Sensitive Whole Life-Bal End-of-Quarter	$	2.191		$	2.185		$	2.195		$	2.182		$	2.185		$	2.193		$	2.214		$	2.201		$	2.202		$	2.213		$	2.236		$	2.227
Total Segment- Life Insurance Account Values
Bal Beg-of-Quarter	$	12.233		$	12.663		$	12.958		$	13.420		$	13.606		$	13.770		$	13.912		$	14.382		$	14.466		$	14.691		$	15.001		$	15.368
Deposits		0.526			0.586			0.661			0.501			0.507			0.548			0.686			0.512			0.527			0.553			0.648			0.535
Withdrawals & deaths		(0.202	)		(0.231	)		(0.259	)		(0.254	)		(0.217	)		(0.248	)		(0.278	)		(0.252	)		(0.218	)		(0.216	)		(0.198	)		(0.238	)
Net flows		0.324			0.355			0.402			0.248			0.291			0.300			0.408			0.260			0.309			0.337			0.450			0.297
Policyholder assessments		(0.257	)		(0.262	)		(0.280	)		(0.267	)		(0.271	)		(0.272	)		(0.287	)		(0.287	)		(0.290	)		(0.293	)		(0.312	)		(0.303	)
Invest inc & change in market value		0.363			0.202			0.341			0.205			0.145			0.114			0.348			0.111			0.206			0.266			0.230			0.293
Total Segment -Bal End-of-Quarter	$	12.663		$	12.958		$	13.420		$	13.606		$	13.770		$	13.912		$	14.382		$	14.466		$	14.691		$	15.001		$	15.368		$	15.655
Life Product Spread Information (2)
Interest Sensitive Products
Net investment income (3)(4)(5)		7.09	%		6.90	%		6.73	%		6.84	%		6.70	%		6.62	%		6.50	%		6.32	%		6.35	%		6.35	%		6.26	%		6.47	%
Interest credited to policyholders		5.43	%		5.37	%		5.12	%		4.97	%		4.89	%		4.79	%		4.80	%		4.75	%		4.65	%		4.70	%		4.66	%		4.64	%
Spread (3)(4)		1.65	%		1.53	%		1.61	%		1.87	%		1.81	%		1.83	%		1.69	%		1.57	%		1.71	%		1.65	%		1.60	%		1.83	%
Traditional Products
Net investment income (3)(4)		7.13	%		6.99	%		6.72	%		7.33	%		6.61	%		6.97	%		6.60	%		6.43	%		6.50	%		6.40	%		6.36	%		6.48	%
(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 March 31, 2006, interest sensitive products represented 89% 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 7 bps in the 1st quarter of 2006, 11 bps in the 4th quarter of 2005, 4 bps in the 3rd quarter of 2005, 12 bps in the 2nd quarter of 2005, 0 bps in the 1st quarter of 2005, 13 bps in the 4th quarter of 2004, 29 bps in the 3rd quarter of 2004, 32 bps in the 2nd quarter of 2004, and 7 bps in the 1st quarter of 2004. There was an impact on traditional products of 6 bps in the 1st quarter of 2006, 0 bps in the 4th quarter of 2005, 6 bps in the 3rd quarter of 2005, 12 bps in the 2nd quarter of 2005, 5 bps in the 1st quarter of 2005, 7 bps in the 4th quarter of 2004, 59 bps in the 3rd quarter of 2004, 5 bps in the 2nd quarter of 2004, and 0 bps in the 1st quarter of 2004.
(4) First quarter 2004 includes income from contingent interest received, which contributed $6.5 million to net investment income or 25 bps to the yield and spread on Interest Sensitive Products and $2.4 million to net investment income or 72 bps to the yield and spread on Traditional Products.
(5) The net investment income and spread for the first quarter of 2006 includes 17 basis points of incremental yield from special investments.

3/31/2006													PAGE 28
Investment Management
Income Statements
Unaudited [Millions of Dollars]
For the Year Ended December 31	2001			2002			2003			2004			2005
Operating Revenue
Investment advisory fees - External	$	197.2		$	183.3		$	205.0		$	252.5		$	279.0
Investment advisory fees - Insurance-related assets		105.0			97.7			101.2			105.8			98.8
Other revenue and fees		51.7			46.5			72.8			66.2			65.8
Surrender charges		2.2			2.4			2.3			1.9			2.3
Expense assessments		45.3			38.1			42.8			56.8			68.9
Net investment income		53.6			50.5			49.9			51.7			53.0
Operating Revenue		454.9			418.5			474.0			534.9			567.8
Operating Expenses
Interest credited to policy bal.		38.7			31.3			26.4			26.9			27.9
Underwriting, acquisition,
insurance and other expenses:
Commissions and other volume-related expenses		31.6			35.5			42.2			53.0			60.1
Operating and administrative expenses		344.6			335.5			368.7			392.9			430.3
DAC deferral net of amortization		(4.7	)		(9.2	)		(22.8	)		(27.1	)		(19.8	)
Taxes, licenses and fees		16.8			13.0			10.3			17.0			10.7
Subtotal		388.2			374.9			398.4			435.8			481.2
Other intangibles amortization		10.8			8.2			7.9			9.7			7.8
Total underwriting, acquisition,
insurance and other expenses		399.0			383.2			406.3			445.5			489.0
Goodwill amortization		16.2			-			-			-			-
Total Operating Expenses		454.0			414.4			432.7			472.5			516.9
Operating income before federal taxes		0.9			4.1			41.3			62.4			50.9
Federal income taxes		7.0			2.2			6.8			18.9			14.9
Income (Loss) from Operations	$	(6.1	)	$	1.8		$	34.5		$	43.6		$	36.0
Effective tax rate		NM			54.8	%		16.5	%		30.2	%		29.3	%
Average capital (securities at cost)	$	557.0		$	581.2		$	602.4		$	610.9		$	544.9
Return on average capital		(1.1	%)		0.3	%		5.7	%		7.1	%		6.6	%
Roll Forward of Deferred Acquisition Costs
Balance at beginning of period	$	81.1		$	85.6		$	90.8		$	91.8		$	120.4
Deferral		35.6			42.0			42.0			51.4			48.2
Amortization		(30.8	)		(32.9	)		(19.2	)		(24.3	)		(28.3	)
Included in Total Benefits and Expenses		4.7			9.2			22.8			27.1			19.8
Adjustment related to realized (gains) losses
on available-for-sale securities		1.6			2.3			0.5			(1.3	)		(0.4	)
Adjustment related to unrealized (gains) losses
on available-for-sale securities		(1.8	)		(6.3	)		(22.2	)		2.7			14.6
Balance at end of period	$	85.6		$	90.8		$	91.8		$	120.4		$	154.5

3/31/2006																									PAGE 29
Investment Management
Income Statements
Unaudited [Millions of Dollars]
For the Quarter Ended	Mar			Jun			Sep			Dec			Mar			Jun			Sep			Dec			Mar
	2004			2004			2004			2004			2005			2005			2005			2005			2006
Operating Revenue
Investment advisory fees - External	$	62.7		$	66.4		$	67.4		$	56.0		$	59.4		$	66.9		$	73.6		$	79.0		$	84.9
Investment advisory fees - Insurance-related assets		26.5			26.1			26.4			26.8			24.8			24.6			24.9			24.5			25.1
Other revenue and fees		19.1			16.7			13.7			16.7			16.0			14.9			17.1			17.8			19.1
Surrender charges		0.5			0.5			0.4			0.5			0.7			0.5			0.6			0.5			0.8
Expense assessments		14.1			14.7			12.5			15.5			16.6			16.8			17.9			17.6			19.8
Net investment income		12.2			14.6			12.7			12.3			12.9			14.2			12.7			13.2			12.9
Operating Revenue		135.2			139.0			133.0			127.7			130.4			138.0			146.8			152.7			162.6
Operating Expenses
Interest credited to policy bal.		6.6			6.7			6.9			6.8			6.8			7.0			7.0			7.1			7.1
Underwriting, acquisition,
insurance and other expenses:
Commissions and other volume-related expenses		14.0			14.4			12.9			11.7			14.8			13.0			16.4			15.9			16.7
Operating and administrative expenses		96.1			98.5			98.1			100.2			96.4			111.5			112.8			109.5			104.5
DAC deferral net of amortization		(5.6	)		(8.1	)		(9.5	)		(3.9	)		(3.3	)		(2.7	)		(9.9	)		(3.9	)		(2.7	)
Taxes, licenses and fees		3.9			5.5			4.6			3.1			3.0			2.3			2.7			2.8			4.8
Subtotal		108.5			110.3			106.0			111.0			110.9			124.1			122.0			124.2			123.3
Other intangibles amortization		2.0			2.0			2.0			3.8			1.9			1.9			2.0			2.0			2.0
Total underwriting, acquisition,
insurance and other expenses		110.4			112.3			108.0			114.8			112.8			126.0			124.0			126.2			125.2
Total Operating Expenses		117.0			118.9			114.8			121.7			119.6			133.0			131.0			133.3			132.3
Operating income before federal taxes		18.2			20.1			18.2			6.0			10.7			5.0			15.7			19.4			30.3
Federal income taxes		5.6			6.7			5.7			0.8			3.3			1.2			5.6			4.8			10.0
Income from Operations	$	12.5		$	13.4		$	12.5		$	5.2		$	7.4		$	3.9		$	10.2		$	14.6		$	20.3
Effective tax rate		31.1	%		33.4	%		31.3	%		13.6	%		31.2	%		23.1	%		35.4	%		24.9	%		33.0	%
Average capital (securities at cost)	$	634.2		$	634.8		$	627.2		$	547.3		$	548.0		$	542.5		$	540.1		$	549.0		$	543.5
Return on average capital		7.9	%		8.4	%		8.0	%		3.8	%		5.4	%		2.8	%		7.5	%		10.6	%		14.9	%
Roll Forward of Deferred Acquisition Costs
Balance at beginning of period	$	91.8		$	84.2		$	120.1		$	115.3		$	120.4		$	133.8		$	126.7		$	146.2		$	154.5
Deferral		11.7			13.4			12.5			13.8			12.2			10.6			12.8			12.6			13.3
Amortization		(6.1	)		(5.3	)		(3.0	)		(10.0	)		(8.9	)		(7.8	)		(2.9	)		(8.6	)		(10.6	)
Included in Total Benefits and Expenses		5.6			8.1			9.5			3.9			3.3			2.7			9.9			3.9			2.7
Adjustment related to realized (gains) losses
on available-for-sale securities		(3.6	)		2.4			0.4			(0.5	)		0.4			(0.0	)		(0.4	)		(0.4	)		(0.3	)
Adjustment related to unrealized (gains) losses
on available-for-sale securities		(9.6	)		25.4			(14.8	)		1.7			9.8			(9.9	)		9.9			4.8			9.7
Balance at end of period	$	84.2		$	120.1		$	115.3		$	120.4		$	133.8		$	126.7		$	146.2		$	154.5		$	166.5

3/31/2006													PAGE 30
Investment Management
Assets Under Management Rollforward
Unaudited [Billions of Dollars]
	2001			2002			2003			2004			2005
Retail Fixed - Bal Beg-of-Period	$	6.605		$	7.118		$	7.631		$	8.186		$	8.257
Fund Sales		0.876			1.218			1.792			1.882			2.483
Redemptions		(1.051	)		(1.182	)		(1.442	)		(1.520	)		(1.476	)
Net Money Market		(0.046	)		(0.050	)		(0.028	)		(0.113	)		(0.060	)
Transfers		0.405			0.206			(0.168	)		(0.212	)		(0.082	)
Net Flows		0.184			0.192			0.154			0.037			0.865
Market		0.330			0.321			0.401			0.290			0.079
Transfer of Assets Under Administration(1)		-			-			-			(0.256	)		(0.001	)
Balance end of period	$	7.118		$	7.631		$	8.186		$	8.257		$	9.199
Retail Equity - Bal Beg-of-Period	$	21.525		$	17.990		$	14.917		$	20.887		$	26.130
Fund Sales		2.817			4.477			3.791			7.110			11.573
Redemptions		(2.838	)		(3.690	)		(2.830	)		(4.054	)		(5.138	)
Transfers		(0.538	)		(0.173	)		0.156			0.042			(0.203	)
Net Flows		(0.560	)		0.614			1.117			3.099			6.233
Market		(2.975	)		(3.688	)		4.854			3.256			3.114
Sale of subsidiary/Transfer of Assets Under
Administration (1) (2)		-			-			-			(1.112	)		(0.003	)
Balance at end of period	$	17.990		$	14.917		$	20.887		$	26.130		$	35.474
Total Retail - Bal Beg-of-Period	$	28.130		$	25.108		$	22.547		$	29.073		$	34.387
Retail Sales-Annuities		1.701			2.751			2.151			2.757			2.957
Retail Sales-Mutual Funds		1.523			1.829			2.315			3.235			4.860
Retail Sales-Managed Acct. & Other		0.469			1.115			1.116			2.999			6.239
Total Retail Sales		3.693			5.695			5.583			8.992			14.056
Redemptions		(3.889	)		(4.873	)		(4.272	)		(5.574	)		(6.613	)
Net Money Market		(0.046	)		(0.050	)		(0.028	)		(0.113	)		(0.060	)
Transfers		(0.133	)		0.033			(0.012	)		(0.170	)		(0.285	)
Net Flows		(0.375	)		0.806			1.271			3.136			7.098
Market		(2.646	)		(3.366	)		5.255			3.546			3.193
Sale of subsidiary/Transfer of Assets Under
Administration (1) (2)		-			-			-			(1.368	)		(0.004	)
Balance at end of period(1) (2)	$	25.108		$	22.547		$	29.073		$	34.387		$	44.673
Institutional Fixed - Bal Beg-of-Period	$	6.111		$	5.489		$	7.237		$	8.399		$	9.960
Inflows		0.643			2.281			1.937			5.134			4.277
Withdrawals/Terminations		(1.229	)		(1.146	)		(1.226	)		(0.593	)		(1.300	)
Transfers		0.017			0.004			0.005			0.009			0.000
Net Flows (2)		(0.569	)		1.139			0.716			4.549			2.977
Market		(0.053	)		0.608			0.447			0.135			0.104
Sale of Subsidiary (2)		-			-			-			(3.124	)		-
Balance at end of period (2)	$	5.489		$	7.237		$	8.399		$	9.960		$	13.042
Institutional Equity - Bal Beg-of-Period	$	19.114		$	17.815		$	16.711		$	25.322		$	11.682
Inflows		3.183			2.913			3.922			6.155			10.356
Withdrawals/Terminations		(2.879	)		(1.991	)		(2.178	)		(3.583	)		(4.520	)
Transfers		0.035			0.045			0.018			0.057			0.048
Net Flows		0.338			0.967			1.762			2.629			5.884
Market		(1.637	)		(2.071	)		6.849			2.394			1.813
Sale of Subsidiary (2)		-			-			-			(18.664	)		-
Balance at end of period	$	17.815		$	16.711		$	25.322		$	11.682		$	19.379
Total Institutional - Bal Beg-of-Period	$	25.225		$	23.305		$	23.948		$	33.722		$	21.643
Inflows		3.826			5.194			5.859			11.289			14.633
Withdrawals/Terminations		(4.109	)		(3.137	)		(3.404	)		(4.176	)		(5.820	)
Transfers		0.052			0.050			0.023			0.066			0.048
Net Flows		(0.231	)		2.106			2.478			7.178			8.861
Market		(1.690	)		(1.463	)		7.296			2.530			1.917
Sale of Subsidiary (2)		-			-			-			(21.787	)		-
Balance at end of period	$	23.305		$	23.948		$	33.722		$	21.643		$	32.420
Total Retail/Institutional - At end of period	$	48.412		$	46.495		$	62.794		$	56.029		$	77.093
Insurance-related Assets - At end of period	$	38.119		$	41.104		$	43.024		$	43.980		$	44.483
Total Retail/Inst - Net Flows	$	(0.606	)	$	2.912		$	3.749		$	10.314		$	15.959
Total Assets Under Management
At end of period	$	86.531		$	87.599		$	105.818		$	100.009		$	121.576
Subadvised Assets, included in Assets Under Management above
Retail	$	3.330		$	2.460		$	3.750		$	10.740		$	17.162
Institutional		0.030			0.020			0.030			3.740			4.782
Total Subadvised Assets	$	3.360		$	2.480		$	3.780		$	14.480		$	21.945
(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, 2004 had net outflows of assets under management of approximately $1.052 billion.
(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 30A 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.

3/31/2006													PAGE 30A
Investment Management (excluding Assets Managed by
Delaware's London-based International Investment Unit)
Assets Under Management Rollforward
Unaudited [Billions of Dollars]
	2001			2002			2003			2004			2005
Retail Fixed - Bal Beg-of-Period	$	6.604		$	7.118		$	7.631		$	8.186		$	8.257
Fund Sales		0.876			1.218			1.792			1.882			2.483
Redemptions		(1.051	)		(1.182	)		(1.442	)		(1.520	)		(1.476	)
Net Money Market		(0.046	)		(0.050	)		(0.028	)		(0.113	)		(0.060	)
Transfers		0.405			0.206			(0.168	)		(0.212	)		(0.082	)
Net Flows		0.184			0.192			0.154			0.037			0.865
Market		0.330			0.321			0.401			0.290			0.079
Transfer of Assets Under Administration (1)		-			-			-			(0.256	)		(0.001	)
Balance end of period	$	7.118		$	7.631		$	8.186		$	8.257		$	9.199
Retail Equity - Bal Beg-of-Period	$	21.525		$	17.990		$	14.624		$	20.564		$	26.130
Fund Sales		2.817			4.182			3.780			7.105			11.573
Redemptions		(2.838	)		(3.684	)		(2.765	)		(4.024	)		(5.138	)
Transfers		(0.538	)		(0.173	)		0.156			0.042			(0.203	)
Net Flows		(0.560	)		0.325			1.171			3.123			6.233
Market		(2.975	)		(3.691	)		4.769			3.236			3.114
Transfer of Assets Under Administration (1)		-			-			-			(0.793	)		(0.003	)
Balance at end of period	$	17.990		$	14.624		$	20.564		$	26.130		$	35.474
Total Retail - Bal Beg-of-Period	$	28.129		$	25.108		$	22.255		$	28.750		$	34.387
Retail Sales-Annuities		1.701			2.456			2.140			2.752			2.957
Retail Sales-Mutual Funds		1.523			1.829			2.315			3.235			4.860
Retail Sales-Managed Acct. & Other		0.469			1.115			1.116			2.999			6.239
Total Retail Sales		3.693			5.399			5.572			8.987			14.056
Redemptions		(3.889	)		(4.867	)		(4.207	)		(5.544	)		(6.613	)
Net Money Market		(0.046	)		(0.050	)		(0.028	)		(0.113	)		(0.060	)
Transfers		(0.133	)		0.033			(0.012	)		(0.170	)		(0.285	)
Net Flows		(0.375	)		0.517			1.325			3.160			7.098
Market		(2.646	)		(3.370	)		5.171			3.526			3.193
Transfer of Assets Under Administration (1)		-			-			-			(1.049	)		(0.004	)
Balance at end of period	$	25.108		$	22.255		$	28.750		$	34.387		$	44.673
Institutional Fixed - Bal Beg-of-Period	$	3.590		$	3.377		$	5.147		$	5.981		$	9.960
Inflows		0.388			2.177			1.540			4.356			4.277
Withdrawals/Terminations		(0.586	)		(0.541	)		(0.635	)		(0.452	)		(1.300	)
Transfers		0.017			0.004			(0.126	)		0.009			0.000
Net Flows		(0.181	)		1.640			0.779			3.913			2.977
Market		(0.032	)		0.130			0.055			0.067			0.104
Balance at end of period	$	3.377		$	5.147		$	5.981		$	9.960		$	13.042
Institutional Equity - Bal Beg-of-Period	$	9.664		$	8.185		$	7.201		$	10.318		$	11.682
Inflows		1.555			1.532			1.780			2.281			10.356
Withdrawals/Terminations		(2.334	)		(1.333	)		(1.161	)		(2.428	)		(4.520	)
Transfers		0.035			0.045			0.034			0.118			0.048
Net Flows		(0.744	)		0.245			0.653			(0.029	)		5.884
Market		(0.735	)		(1.229	)		2.463			1.393			1.813
Balance at end of period	$	8.185		$	7.201		$	10.318		$	11.682		$	19.379
Total Institutional - Bal Beg-of-Period	$	13.255		$	11.562		$	12.348		$	16.299		$	21.643
Inflows		1.943			3.709			3.320			6.637			14.633
Withdrawals/Terminations		(2.920	)		(1.874	)		(1.796	)		(2.880	)		(5.820	)
Transfers		0.052			0.050			(0.092	)		0.127			0.048
Net Flows		(0.925	)		1.885			1.433			3.884			8.861
Market		(0.767	)		(1.099	)		2.518			1.459			1.917
Balance at end of period	$	11.562		$	12.348		$	16.299		$	21.643		$	32.420
Total Retail/Institutional - At end of period	$	36.670		$	34.603		$	45.049		$	56.029		$	77.093
Insurance-related Assets - At end of period	$	38.119		$	41.104		$	43.024		$	43.980		$	44.483
Total Retail/Inst - Net Flows	$	(1.301	)	$	2.402		$	2.757		$	7.045		$	15.959
Total Assets Under Management
At end of period	$	74.789		$	75.707		$	88.072		$	100.009		$	121.576
Subadvised Assets, included in Assets Under Management above
Retail	$	3.330		$	2.460		$	3.750		$	10.740		$	17.162
Institutional		0.030			0.020			0.030			3.740			4.782
Total Subadvised Assets	$	3.360		$	2.480		$	3.780		$	14.480		$	21.945
(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, 2004 had net outflows of assets under management of approximately $1.052 billion.
(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.

3/31/2006																																		PAGE 31
Investment Management
Assets Under Management Roll Forward
Unaudited [Billions of Dollars]
	Jun			Sep			Dec			Mar			Jun			Sep			Dec			Mar			Jun			Sep			Dec			Mar
	2003			2003			2003			2004			2004			2004			2004			2005			2005			2005			2005			2006
Retail Fixed - Bal-Beg-of-Qtr	$	7.907		$	8.190		$	8.083		$	8.186		$	8.313		$	8.152		$	8.060		$	8.257		$	8.501		$	8.823		$	9.061		$	9.199
Fund Sales		0.469			0.443			0.456			0.513			0.452			0.425			0.493			0.608			0.612			0.602			0.661			0.597
Redemptions		(0.318	)		(0.435	)		(0.361	)		(0.418	)		(0.462	)		(0.341	)		(0.299	)		(0.373	)		(0.325	)		(0.346	)		(0.432	)		(0.475	)
Net Money Market		(0.006	)		(0.008	)		(0.014	)		(0.036	)		0.012			(0.069	)		(0.020	)		(0.026	)		(0.015	)		(0.010	)		(0.010	)		(0.043	)
Transfers		(0.055	)		(0.086	)		(0.088	)		(0.035	)		(0.019	)		(0.119	)		(0.040	)		0.104			(0.107	)		0.023			(0.102	)		0.034
Net Flows		0.090			(0.087	)		(0.008	)		0.024			(0.017	)		(0.104	)		0.134			0.314			0.166			0.268			0.117			0.113
Market		0.193			(0.020	)		0.111			0.103			(0.144	)		0.207			0.125			(0.068	)		0.156			(0.030	)		0.021			0.022
Transfer of Assets Under Administration(1)																	(0.194	)		(0.062	)		(0.001	)		-			-			-			-
Balance at End-of-Qtr	$	8.190		$	8.083		$	8.186		$	8.313		$	8.152		$	8.060		$	8.257		$	8.501		$	8.823		$	9.061		$	9.199		$	9.334
Retail Equity - Bal-Beg-of-Qtr	$	14.286		$	16.906		$	17.961		$	20.887		$	22.546		$	23.223		$	22.620		$	26.130		$	26.970		$	29.898		$	33.449		$	35.474
Fund Sales		0.813			1.051			1.210			1.938			1.666			1.480			2.026			2.773			3.421			2.882			2.497			3.184
Redemptions		(0.612	)		(0.706	)		(0.710	)		(0.992	)		(1.028	)		(1.081	)		(0.953	)		(1.325	)		(1.305	)		(1.198	)		(1.310	)		(1.762	)
Transfers		0.011			0.112			0.092			(0.002	)		(0.004	)		0.085			(0.037	)		(0.183	)		0.049			(0.111	)		0.042			(0.083	)
Net Flows		0.213			0.457			0.592			0.944			0.634			0.485			1.036			1.265			2.166			1.573			1.229			1.339
Market		2.408			0.598			2.334			0.715			0.044			(0.188	)		2.685			(0.423	)		0.763			1.979			0.796			2.677
Sale of Subsidiary/Transfer of Assets Under
Administration (1) (2)		-			-			-			-			-			(0.901	)		(0.211	)		(0.003	)		-			-			-			-
Balance at End-of-Qtr	$	16.906		$	17.961		$	20.887		$	22.546		$	23.223		$	22.620		$	26.130		$	26.970		$	29.898		$	33.449		$	35.474		$	39.490
Total Retail - Bal-Beg-of-Qtr	$	22.193		$	25.096		$	26.044		$	29.073		$	30.859		$	31.375		$	30.680		$	34.387		$	35.471		$	38.720		$	42.509		$	44.673
Retail Sales-Annuities		0.528			0.573			0.562			0.753			0.668			0.600			0.737			0.735			0.655			0.752			0.815			0.918
Retail Sales-Mutual Funds		0.558			0.644			0.663			0.905			0.729			0.680			0.922			1.336			1.255			1.159			1.110			1.094
Retail Sales-Managed Acct. & Other		0.196			0.277			0.441			0.793			0.721			0.625			0.860			1.310			2.123			1.573			1.232			1.769
Total Retail Sales		1.282			1.494			1.666			2.451			2.117			1.905			2.519			3.381			4.034			3.484			3.158			3.781
Redemptions		(0.930	)		(1.141	)		(1.071	)		(1.409	)		(1.491	)		(1.422	)		(1.252	)		(1.697	)		(1.630	)		(1.545	)		(1.741	)		(2.237	)
Net Money Market		(0.006	)		(0.008	)		(0.014	)		(0.036	)		0.012			(0.069	)		(0.020	)		(0.026	)		(0.015	)		(0.010	)		(0.010	)		(0.043	)
Transfers		(0.044	)		0.025			0.004			(0.037	)		(0.022	)		(0.034	)		(0.077	)		(0.079	)		(0.058	)		(0.089	)		(0.060	)		(0.049	)
Net Flows		0.302			0.370			0.584			0.969			0.617			0.381			1.170			1.579			2.331			1.841			1.347			1.452
Market		2.601			0.578			2.444			0.818			(0.101	)		0.019			2.810			(0.491	)		0.919			1.948			0.817			2.699
Sale of Subsidiary/Transfer of Assets Under
Administration (1) (2)		-			-			-			-			-			(1.095	)		(0.273	)		(0.004	)		-			-			-			-
Balance at End-of-Qtr	$	25.096		$	26.044		$	29.073		$	30.859		$	31.375		$	30.680		$	34.387		$	35.471		$	38.720		$	42.509		$	44.673		$	48.824
Institutional Fixed - Bal-Beg-of-Qtr	$	7.605		$	7.753		$	8.077		$	8.399		$	9.028		$	9.906		$	7.906		$	9.960		$	11.002		$	11.769		$	12.219		$	13.042
Inflows		0.126			0.556			0.663			0.806			1.281			0.947			2.100			1.211			1.289			0.840			0.937			2.874
Withdrawals/Terminations		(0.188	)		(0.226	)		(0.503	)		(0.218	)		(0.135	)		(0.163	)		(0.077	)		(0.130	)		(0.742	)		(0.296	)		(0.132	)		(0.309	)
Transfers		0.003			(0.000	)		(0.000	)		0.005			0.002			0.001			0.001			0.000			0.001			0.001			(0.001	)		0.009
Net Flows		(0.059	)		0.330			0.160			0.593			1.148			0.784			2.024			1.082			0.548			0.545			0.803			2.574
Market		0.207			(0.006	)		0.163			0.036			(0.271	)		0.339			0.031			(0.040	)		0.219			(0.095	)		0.019			(0.087	)
Sale of Subsidiary (2)		-			-			-			-			-			(3.124	)		-			-			-			-			-			-
Balance at End-of-Qtr	$	7.753		$	8.077		$	8.399		$	9.028		$	9.906		$	7.906		$	9.960		$	11.002		$	11.769		$	12.219		$	13.042		$	15.529
Institutional Equity - Bal-Beg-of-Qtr	$	15.920		$	19.607		$	21.008		$	25.322		$	27.188		$	28.362		$	10.490		$	11.682		$	11.549		$	15.474		$	17.760		$	19.379
Inflows		0.727			1.386			1.315			1.817			2.049			1.638			0.650			0.576			4.563			1.937			3.280			1.909
Withdrawals/Terminations		(0.381	)		(0.921	)		(0.419	)		(0.762	)		(1.161	)		(1.053	)		(0.607	)		(0.473	)		(1.000	)		(0.888	)		(2.160	)		(0.934	)
Transfers		0.002			0.003			0.005			0.012			0.006			0.010			0.029			0.033			(0.003	)		0.012			0.006			0.003
Net Flows		0.348			0.469			0.901			1.068			0.895			0.595			0.072			0.135			3.560			1.061			1.127			0.977
Market		3.339			0.932			3.413			0.798			0.280			0.196			1.120			(0.269	)		0.365			1.225			0.492			1.313
Sale of Subsidiary (2)		-			-			-			-			-			(18.664	)		-			-			-			-			-			-
Balance at End-of-Qtr	$	19.607		$	21.008		$	25.322		$	27.188		$	28.362		$	10.490		$	11.682		$	11.549		$	15.474		$	17.760		$	19.379		$	21.669
Total Institutional - Bal-Beg-of-Qtr	$	23.526		$	27.360		$	29.085		$	33.722		$	36.216		$	38.268		$	18.396		$	21.643		$	22.551		$	27.243		$	29.979		$	32.420
Inflows		0.853			1.943			1.978			2.623			3.331			2.584			2.750			1.787			5.852			2.777			4.217			4.783
Withdrawals/Terminations		(0.568	)		(1.147	)		(0.922	)		(0.980	)		(1.296	)		(1.216	)		(0.684	)		(0.603	)		(1.742	)		(1.183	)		(2.292	)		(1.243	)
Transfers		0.005			0.003			0.005			0.017			0.008			0.011			0.030			0.033			(0.002	)		0.012			0.005			0.012
Net Flows		0.289			0.799			1.061			1.661			2.043			1.379			2.095			1.217			4.108			1.606			1.930			3.551
Market		3.546			0.926			3.576			0.834			0.009			0.535			1.151			(0.308	)		0.584			1.130			0.511			1.226
Sale of Subsidiary (2)		-			-			-			-			-			(21.787	)		-			-			-			-			-			-
Balance at End-of-Qtr	$	27.360		$	29.085		$	33.722		$	36.216		$	38.268		$	18.396		$	21.643		$	22.551		$	27.243		$	29.979		$	32.420		$	37.197
Total Retail/Inst - At End-of-Qtr	$	52.456		$	55.129		$	62.794		$	67.075		$	69.643		$	49.076		$	56.029		$	58.022		$	65.963		$	72.488		$	77.093		$	86.021
Insurance-related Assets-End-of-Qtr	$	43.857		$	42.984		$	43.024		$	44.006		$	42.528		$	44.047		$	43.980		$	44.210		$	45.219		$	44.503		$	44.483		$	43.430
Total Retail/Inst - Net Flows	$	0.591		$	1.169		$	1.645		$	2.629		$	2.660		$	1.760		$	3.265		$	2.796		$	6.439		$	3.447		$	3.277		$	5.004
Total Assets Under Management
At End-of-Qtr	$	96.313		$	98.113		$	105.818		$	111.081		$	112.172		$	93.123		$	100.009		$	102.231		$	111.182		$	116.992		$	121.576		$	129.452
Subadvised Assets, included in Assets Under Management above
Retail	$	2.970		$	3.240		$	3.750		$	4.000		$	4.290		$	8.830		$	10.740		$	12.178		$	13.712		$	15.905		$	17.162		$	19.127
Institutional		0.030			0.020			0.030			0.030			0.030			3.070			3.740			3.921			4.221			4.641			4.782			5.274
Total Subadvised Assets	$	3.000		$	3.260		$	3.780		$	4.030		$	4.320		$	11.900		$	14.480		$	16.100		$	17.933		$	20.545		$	21.945		$	24.400
(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 31A 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.

3/31/2006																															PAGE 31A
Investment Management (excluding Assets
Managed by Delaware's London-based International Investment Unit)
Assets Under Management Roll Forward
Unaudited [Billions of Dollars]
	Jun			Sep			Dec			Mar			Jun			Sep			Dec			Mar			Jun			Sep			Dec			Mar
	2003			2003			2003			2004			2004			2004			2004			2005			2005			2005			2005			2006
Retail Fixed - Bal-Beg-of-Qtr	$	7.907		$	8.190		$	8.083		$	8.186		$	8.313		$	8.152		$	8.060		$	8.257		$	8.501		$	8.823		$	9.061		$	9.199
Fund Sales		0.469			0.443			0.456			0.513			0.452			0.425			0.493			0.608			0.612			0.602			0.661			0.597
Redemptions		(0.318	)		(0.435	)		(0.361	)		(0.418	)		(0.462	)		(0.341	)		(0.299	)		(0.373	)		(0.325	)		(0.346	)		(0.432	)		(0.475	)
Net Money Market		(0.006	)		(0.008	)		(0.014	)		(0.036	)		0.012			(0.069	)		(0.020	)		(0.026	)		(0.015	)		(0.010	)		(0.010	)		(0.043	)
Transfers		(0.055	)		(0.086	)		(0.088	)		(0.035	)		(0.019	)		(0.119	)		(0.040	)		0.104			(0.107	)		0.023			(0.102	)		0.034
Net Flows		0.090			(0.087	)		(0.008	)		0.024			(0.017	)		(0.104	)		0.134			0.314			0.166			0.268			0.117			0.113
Market		0.193			(0.020	)		0.111			0.103			(0.144	)		0.207			0.125			(0.068	)		0.156			(0.030	)		0.021			0.022
Transfer of Assets Under Administration (1)		-			-			-			-			-			(0.194	)		(0.062	)		(0.001	)		-			-			-			-
Balance at End-of-Qtr	$	8.190		$	8.083		$	8.186		$	8.313		$	8.152		$	8.060		$	8.257		$	8.501		$	8.823		$	9.061		$	9.199		$	9.334
Retail Equity - Bal-Beg-of-Qtr	$	14.048		$	16.622		$	17.673		$	20.564		$	22.225		$	22.906		$	22.620		$	26.130		$	26.970		$	29.898		$	33.449		$	35.474
Fund Sales		0.812			1.048			1.208			1.936			1.664			1.478			2.026			2.773			3.421			2.882			2.497			3.184
Redemptions		(0.608	)		(0.698	)		(0.694	)		(0.979	)		(1.019	)		(1.074	)		(0.953	)		(1.325	)		(1.305	)		(1.198	)		(1.310	)		(1.762	)
Transfers		0.011			0.112			0.092			(0.002	)		(0.004	)		0.085			(0.037	)		(0.183	)		0.049			(0.111	)		0.042			(0.083	)
Net Flows		0.214			0.462			0.606			0.956			0.641			0.490			1.036			1.265			2.166			1.573			1.229			1.339
Market		2.359			0.589			2.285			0.706			0.039			(0.194	)		2.685			(0.423	)		0.763			1.979			0.796			2.677
Transfer of Assets Under Administration (1)		-			-			-			-			-			(0.582	)		(0.211	)		(0.003	)		-			-			-			-
Balance at End-of-Qtr	$	16.622		$	17.673		$	20.564		$	22.225		$	22.906		$	22.620		$	26.130		$	26.970		$	29.898		$	33.449		$	35.474		$	39.490
Total Retail - Bal-Beg-of-Qtr	$	21.955		$	24.812		$	25.756		$	28.750		$	30.538		$	31.057		$	30.680		$	34.387		$	35.471		$	38.720		$	42.509		$	44.673
Retail Sales-Annuities		0.526			0.570			0.560			0.751			0.666			0.598			0.737			0.735			0.655			0.752			0.815			0.918
Retail Sales-Mutual Funds		0.558			0.644			0.663			0.905			0.729			0.680			0.922			1.336			1.255			1.159			1.110			1.094
Retail Sales-Managed Acct. & Other		0.196			0.277			0.441			0.793			0.721			0.625			0.860			1.310			2.123			1.573			1.232			1.769
Total Retail Sales		1.280			1.491			1.664			2.449			2.115			1.903			2.519			3.381			4.034			3.484			3.158			3.781
Redemptions		(0.926	)		(1.133	)		(1.055	)		(1.396	)		(1.481	)		(1.415	)		(1.252	)		(1.697	)		(1.630	)		(1.545	)		(1.741	)		(2.237	)
Net Money Market		(0.006	)		(0.008	)		(0.014	)		(0.036	)		0.012			(0.069	)		(0.020	)		(0.026	)		(0.015	)		(0.010	)		(0.010	)		(0.043	)
Transfers		(0.044	)		0.025			0.004			(0.037	)		(0.022	)		(0.034	)		(0.077	)		(0.079	)		(0.058	)		(0.089	)		(0.060	)		(0.049	)
Net Flows		0.304			0.375			0.598			0.980			0.624			0.386			1.170			1.579			2.331			1.841			1.347			1.452
Market		2.552			0.569			2.396			0.808			(0.105	)		0.013			2.810			(0.491	)		0.919			1.948			0.817			2.699
Transfer of Assets Under Administration (1)		-			-			-			-			-			(0.776	)		(0.273	)		(0.004	)		-			-			-			-
Balance at End-of-Qtr	$	24.812		$	25.756		$	28.750		$	30.538		$	31.057		$	30.680		$	34.387		$	35.471		$	38.720		$	42.509		$	44.673		$	48.824
Institutional Fixed - Bal-Beg-of-Qtr	$	5.530		$	5.481		$	5.834		$	5.981		$	6.501		$	6.980		$	7.906		$	9.960		$	11.002		$	11.769		$	12.219		$	13.042
Inflows		0.120			0.516			0.351			0.655			0.776			0.825			2.100			1.211			1.289			0.840			0.937			2.874
Withdrawals/Terminations		(0.152	)		(0.089	)		(0.236	)		(0.138	)		(0.109	)		(0.127	)		(0.077	)		(0.130	)		(0.742	)		(0.296	)		(0.132	)		(0.309	)
Transfers		(0.099	)		(0.056	)		0.028			0.005			0.002			0.001			0.001			0.000			0.001			0.001			(0.001	)		0.009
Net Flows		(0.132	)		0.371			0.143			0.521			0.669			0.699			2.024			1.082			0.548			0.545			0.803			2.574
Market		0.083			(0.019	)		0.004			(0.001	)		(0.191	)		0.227			0.031			(0.040	)		0.219			(0.095	)		0.019			(0.087	)
Balance at End-of-Qtr	$	5.481		$	5.834		$	5.981		$	6.501		$	6.980		$	7.906		$	9.960		$	11.002		$	11.769		$	12.219		$	13.042		$	15.529
Institutional Equity - Bal-Beg-of-Qtr	$	7.041		$	8.462		$	8.826		$	10.318		$	10.713		$	10.435		$	10.490		$	11.682		$	11.549		$	15.474		$	17.760		$	19.379
Inflows		0.347			0.571			0.524			0.552			0.596			0.484			0.650			0.576			4.563			1.937			3.280			1.909
Withdrawals/Terminations		(0.232	)		(0.516	)		(0.231	)		(0.501	)		(0.959	)		(0.361	)		(0.607	)		(0.473	)		(1.000	)		(0.888	)		(2.160	)		(0.934	)
Transfers		0.002			0.003			0.021			(0.012	)		0.073			0.029			0.029			0.033			(0.003	)		0.012			0.006			0.003
Net Flows		0.116			0.059			0.314			0.038			(0.290	)		0.152			0.072			0.135			3.560			1.061			1.127			0.977
Market		1.305			0.305			1.178			0.357			0.012			(0.096	)		1.120			(0.269	)		0.365			1.225			0.492			1.313
Balance at End-of-Qtr	$	8.462		$	8.826		$	10.318		$	10.713		$	10.435		$	10.490		$	11.682		$	11.549		$	15.474		$	17.760		$	19.379		$	21.669
Total Institutional - Bal-Beg-of-Qtr	$	12.571		$	13.943		$	14.660		$	16.299		$	17.215		$	17.414		$	18.396		$	21.643		$	22.551		$	27.243		$	29.979		$	32.420
Inflows		0.466			1.088			0.874			1.206			1.372			1.309			2.750			1.787			5.852			2.777			4.217			4.783
Withdrawals/Terminations		(0.385	)		(0.604	)		(0.466	)		(0.640	)		(1.068	)		(0.488	)		(0.684	)		(0.603	)		(1.742	)		(1.183	)		(2.292	)		(1.243	)
Transfers		(0.098	)		(0.053	)		0.049			(0.007	)		0.075			0.030			0.030			0.033			(0.002	)		0.012			0.005			0.012
Net Flows		(0.016	)		0.430			0.457			0.560			0.379			0.851			2.095			1.217			4.108			1.606			1.930			3.551
Market		1.388			0.287			1.182			0.356			(0.179	)		0.131			1.151			(0.308	)		0.584			1.130			0.511			1.226
Balance at End-of-Qtr	$	13.943		$	14.660		$	16.299		$	17.215		$	17.414		$	18.396		$	21.643		$	22.551		$	27.243		$	29.979		$	32.420		$	37.197
Total Retail/Inst - At End-of-Qtr	$	38.755		$	40.416		$	45.049		$	47.753		$	48.471		$	49.076		$	56.029		$	58.022		$	65.963		$	72.488		$	77.093		$	86.021
Insurance-related Assets-End-of-Qtr	$	43.857		$	42.984		$	43.024		$	44.006		$	42.528		$	44.047		$	43.980		$	44.210		$	45.219		$	44.503		$	44.483		$	43.430
Total Retail/Inst - Net Flows	$	0.288		$	0.805		$	1.055		$	1.540		$	1.003		$	1.236		$	3.265		$	2.796		$	6.439		$	3.447		$	3.277		$	5.004
Total Assets Under Management
At End-of-Qtr	$	82.612		$	83.400		$	88.072		$	91.759		$	91.000		$	93.123		$	100.009		$	102.231		$	111.182		$	116.992		$	121.576		$	129.452
Subadvised Assets, included in Assets Under Management above
Retail	$	2.970		$	3.240		$	3.750		$	4.000		$	4.290		$	8.830		$	10.740		$	12.178		$	13.712		$	15.905		$	17.162		$	19.127
Institutional		0.030			0.020			0.030			0.030			0.030			3.070			3.740			3.921			4.221			4.641			4.782			5.274
Total Subadvised Assets	$	3.000		$	3.260		$	3.780		$	4.030		$	4.320		$	11.900		$	14.480		$	16.100		$	17.933		$	20.545		$	21.945		$	24.400
(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.

3/31/2006													PAGE 32
Lincoln UK
Income Statements
Unaudited [Millions of Dollars]
For the Year Ended December 31	2001			2002			2003			2004			2005
Operating Revenue
Premiums	$	46.1		$	50.6		$	62.2		$	70.3		$	63.3
Mortality assessments		33.9			32.4			35.7			39.5			34.8
Expense assessments		134.8			105.3			93.9			103.9			111.5
Other revenue and fees		(1.4	)		24.9			18.6			52.8			30.3
Net investment income		64.8			62.1			64.1			75.7			78.6
Total Operating Revenue		278.2			275.4			274.5			342.2			318.4
Operating Expenses
Benefits paid or provided		83.4			84.2			98.6			100.4			116.0
Underwriting, acquisition,
insurance and other expenses:
Commissions and other volume-related expenses		10.8			6.1			3.8			2.9			2.3
Operating and administrative expenses		82.5			77.0			78.3			81.0			98.3
Subtotal		93.2			83.1			82.1			83.9			100.6
DAC deferral net of amortization		31.7			46.5			39.1			72.8			45.1
VOBA amortization		22.5			30.8			(10.7	)		18.1			(10.1	)
Total underwriting, acquisition,
insurance and other expenses		147.4			160.5			110.4			174.8			135.7
Goodwill amortization		0.6			-			-			-			-
Total Operating Expenses		231.5			244.7			209.0			275.2			251.7
Operating income before federal taxes		46.8			30.7			65.5			67.0			66.7
Federal income taxes		(11.3	)		(3.9	)		21.9			23.4			23.4
Income from Operations	$	58.1		$	34.6		$	43.6		$	43.5		$	43.4
Effective tax rate		(24.2	%)		(12.8	%)		33.4	%		35.0	%		35.0	%
Average capital	$	593.8		$	549.9		$	478.9		$	435.4		$	446.8
Return on average capital		9.8	%		6.3	%		9.1	%		10.0	%		9.7	%
Roll Forward of Deferred Acquisition Costs
Balance at beginning of period				$	587.3		$	597.6		$	620.6		$	590.8
Deferral					3.4			3.5			6.3			2.8
Amortization					(50.0	)		(42.5	)		(79.1	)		(47.9	)
Included in Total Operating Expenses					(46.5	)		(39.1	)		(72.8	)		(45.1	)
Foreign currency translation adjustment					56.8			62.1			42.9			(59.5	)
Balance at end of period				$	597.6		$	620.6		$	590.8		$	486.3
Roll Forward of Value of Business Acquired
Balance at beginning of period				$	244.0		$	237.3		$	274.7		$	276.2
Amortization					(30.8	)		10.7			(18.1	)		10.1
Foreign currency translation adjustment					24.1			26.7			19.6			(29.0	)
Balance at end of period				$	237.3		$	274.7		$	276.2		$	257.2
Roll Forward of Deferred Front-End Load*
Balance at beginning of period	$	417.6		$	410.0		$	428.2		$	457.9		$	437.5
Deferral		33.4			16.7			10.4			6.6			4.2
Amortization		(30.4	)		(38.7	)		(26.4	)		(58.7	)		(34.8	)
Included in Income from Operations		3.0			(22.0	)		(16.0	)		(52.1	)		(30.6	)
Foreign currency translation adjustment		(10.6	)		40.2			45.8			31.7			(43.9	)
Balance at end of period	$	410.0		$	428.2		$	457.9		$	437.5		$	363.1
* Included in Insurance and Investment Contract Liabilities on the Balance Sheet

3/31/2006																									PAGE 33
Lincoln UK
Income Statements
Unaudited [Millions of Dollars]
For the Quarter Ended	Mar			Jun			Sep			Dec			Mar			Jun			Sep			Dec			Mar
	2004			2004			2004			2004			2005			2005			2005			2005			2006
Operating Revenue
Premiums	$	18.1		$	19.6		$	17.7		$	14.9		$	14.6		$	16.4		$	16.9		$	15.4		$	16.5
Mortality assessments		9.6			10.4			9.7			9.8			9.0			9.4			9.0			7.3			7.8
Expense assessments		24.2			24.4			27.0			28.3			26.6			27.9			27.9			29.1			25.7
Other revenue and fees		5.8			8.3			22.8			16.0			4.1			5.2			28.1			(7.1	)		2.4
Net investment income		18.5			18.3			18.7			20.2			20.3			19.6			20.9			17.8			17.0
Total Operating Revenue		76.1			81.0			95.8			89.3			74.6			78.4			102.8			62.5			69.5
Operating Expenses
Benefits paid or provided		29.0			28.8			21.4			21.3			25.1			27.9			35.5			27.5			25.4
Underwriting, acquisition,
insurance and other expenses:
Commissions and other volume-related expenses		0.6			0.6			0.7			1.0			0.6			0.7			0.9			0.1			0.9
Operating and administrative expenses		23.0			22.3			21.6			14.1			25.4			23.8			24.9			24.2			22.7
Subtotal		23.5			22.9			22.4			15.1			25.9			24.5			25.8			24.3			23.6
DAC deferral net of amortization		11.0			12.6			27.2			21.9			7.1			8.4			37.0			(7.4	)		3.5
VOBA amortization		3.0			0.1			9.4			5.6			1.0			1.7			(10.2	)		(2.5	)		0.5
Total underwriting, acquisition,
insurance and other expenses		37.6			35.7			59.0			42.5			34.0			34.7			52.7			14.3			27.6
Total Operating Expenses		66.6			64.5			80.3			63.8			59.2			62.6			88.1			41.8			52.9
Operating income before federal income taxes		9.5			16.5			15.5			25.5			15.5			15.9			14.7			20.7			16.5
Federal income taxes		3.3			5.8			5.4			8.9			5.4			5.6			5.1			7.2			5.8
Income from Operations	$	6.2		$	10.7		$	10.1		$	16.6		$	10.0		$	10.3		$	9.6		$	13.5		$	10.7
Effective tax rate on
Income from Operations		35.0	%		35.0	%		35.0	%		35.0	%		35.0	%		35.0	%		35.0	%		35.0	%		35.0	%
Average capital	$	447.9		$	421.2		$	432.5		$	439.9		$	440.2		$	446.4		$	452.7		$	447.8		$	427.0
Return on average capital		5.5	%		10.2	%		9.3	%		15.1	%		9.1	%		9.2	%		8.4	%		12.0	%		10.1	%
Roll Forward of Deferred Acquisition Costs
Balance at beginning of period	$	620.7		$	629.6		$	608.6		$	578.9		$	590.9		$	576.9		$	537.0		$	492.0		$	486.3
Deferral		1.5			1.8			1.4			1.6			0.7			0.7			0.7			0.7			0.5
Amortization		(12.5	)		(14.4	)		(28.6	)		(23.5	)		(7.8	)		(9.1	)		(37.7	)		6.7			(4.0	)
Included in Total Operating Expenses		(11.0	)		(12.6	)		(27.2	)		(21.9	)		(7.1	)		(8.4	)		(37.0	)		7.4			(3.5	)
Foreign currency translation adjustment		19.9			(8.4	)		(2.5	)		33.8			(7.0	)		(31.4	)		(8.0	)		(13.2	)		5.1
Balance at end of period	$	629.6		$	608.6		$	578.9		$	590.9		$	576.9		$	537.0		$	492.0		$	486.3		$	487.9
Roll Forward of Value of Business Acquired
Balance at beginning of period	$	276.1		$	280.5		$	276.7		$	266.2		$	276.1		$	271.9		$	255.3		$	261.5		$	257.2
Amortization		(3.0	)		(0.1	)		(9.4	)		(5.6	)		(1.0	)		(1.7	)		10.2			2.5			(0.5	)
Foreign currency translation adjustment		7.4			(3.7	)		(1.1	)		15.6			(3.3	)		(14.8	)		(4.1	)		(6.9	)		2.7
Balance at end of period	$	280.5		$	276.7		$	266.2		$	276.1		$	271.9		$	255.3		$	261.5		$	257.2		$	259.3
Roll Forward of Deferred Front-End Load
Balance at beginning of period	$	457.9		$	466.9		$	452.5		$	428.0		$	437.5		$	428.3		$	399.8		$	365.8		$	363.1
Deferral		2.1			1.7			1.4			1.3			1.5			1.1			0.9			0.7			1.0
Amortization		(7.8	)		(9.9	)		(24.1	)		(16.8	)		(5.5	)		(6.2	)		(29.0	)		6.0			(3.4	)
Included in Income from Operations		(5.7	)		(8.2	)		(22.7	)		(15.5	)		(4.0	)		(5.1	)		(28.1	)		6.7			(2.4	)
Foreign currency translation adjustment		14.7			(6.2	)		(1.8	)		25.0			(5.2	)		(23.3	)		(5.9	)		(9.5	)		3.8
Balance at end of period	$	466.9		$	452.5		$	428.0		$	437.5		$	428.3		$	399.8		$	365.8		$	363.1		$	364.5

* Included in Insurance and Investment Contract Liabilities on the Balance Sheet

3/31/2006																									PAGE 34
Lincoln UK
Operational Data
Unaudited [Billions of Dollars]
For the Year Ended December 31													2001			2002			2003			2004			2005
Unit Linked Assets - Beg-of-Year													$	6.441		$	5.607		$	5.079		$	6.390		$	7.186
Deposits														0.481			0.453			0.392			0.378			0.389
Withdrawals (incl. chgs) & Deaths														(0.529	)		(0.519	)		(0.614	)		(0.712	)		(0.728	)
Net Flows														(0.048	)		(0.066	)		(0.222	)		(0.335	)		(0.339	)
Inv Inc & Chg in Mkt Val														(0.617	)		(1.004	)		0.918			0.648			1.243
Foreign Currency Adjustment														(0.169	)		0.542			0.616			0.482			(0.770	)
Unit Linked Assets - end of year													$	5.607		$	5.079		$	6.390		$	7.186		$	7.320
Individual Life In-force													$	20.878		$	18.896		$	20.393		$	20.378		$	17.521
Exchange Rate - Dollars to Pounds
For-the-Period														1.441			1.503			1.638			1.834			1.821
End-of-Period														1.456			1.610			1.786			1.919			1.719
For the Quarter Ended		Mar			Jun			Sep			Dec			Mar			Jun			Sep			Dec			Mar
		2004			2004			2004			2004			2005			2005			2005			2005			2006
Unit Linked Assets
Balance-Beg-of-Quarter	$	6.390		$	6.528		$	6.476		$	6.468		$	7.186		$	7.173		$	6.903		$	7.180		$	7.320
Deposits		0.083			0.085			0.102			0.108			0.075			0.070			0.088			0.156			0.069
Withdrawals (incl. chgs) & Deaths		(0.172	)		(0.177	)		(0.175	)		(0.188	)		(0.175	)		(0.183	)		(0.192	)		(0.178	)		(0.186	)
Net Flows		(0.090	)		(0.092	)		(0.074	)		(0.080	)		(0.100	)		(0.113	)		(0.104	)		(0.023	)		(0.118	)
Inv Inc & Chg in Mkt Val		0.020			0.127			0.091			0.411			0.171			0.233			0.492			0.347			0.479
Foreign Currency Adjustment		0.207			(0.087	)		(0.025	)		0.387			(0.085	)		(0.390	)		(0.111	)		(0.184	)		0.072
Unit Linked Assets - End-of-Quarter	$	6.528		$	6.476		$	6.468		$	7.186		$	7.173		$	6.903		$	7.180		$	7.320		$	7.754
Individual Life In-force	$	20.522		$	19.846		$	19.380		$	20.378		$	19.820		$	18.479		$	18.175		$	17.521		$	17.744
Exchange Rate - Dollars to Pounds
For-the-Quarter		1.836			1.814			1.813			1.875			1.904			1.855			1.779			1.747			1.754
End-of-Quarter		1.844			1.819			1.812			1.919			1.896			1.792			1.764			1.719			1.737

3/31/2006																									PAGE 35
Other Operations
Unaudited [Millions of Dollars]
For the Year Ended December 31													2001			2002			2003			2004			2005
Operating Revenue by Source:
Lincoln Financial Advisors													$	360.7		$	318.0		$	316.9		$	383.6		$	514.0
Lincoln Financial Distributors														113.4			127.3			140.9			245.2			290.7
Total Distribution														474.0			445.4			457.8			628.8			804.7
Reinsurance														1,699.4			-			-			-			-
Amortization of deferred gain on indemnity      reinsurance*														20.4			75.2			72.3			87.0			75.7
Other [Including
Consolidating Adjustments]														(377.9	)		(165.6	)		(245.8	)		(380.7	)		(528.3	)
Total Operating Revenue													$	1,815.9		$	355.0		$	284.2		$	335.1		$	352.1
Income (Loss) from Operations by Source:
Lincoln Financial Advisors													$	(20.1	)	$	(31.4	)	$	(33.2	)	$	(17.8	)	$	(13.2	)
Lincoln Financial Distributors														(33.2	)		(35.2	)		(33.4	)		(23.7	)		(22.8	)
Total Distribution														(53.3	)		(66.6	)		(66.6	)		(41.5	)		(36.1	)
Reinsurance														128.8			-			-			-			-
Amortization of deferred gain on indemnity        reinsurance*														12.9			48.9			47.0			56.5			49.2
LNC Financing														(77.9	)		(43.0	)		(56.7	)		(61.0	)		(57.6	)
Other Corporate (1)														(9.5	)		3.5			(5.4	)		(11.3	)		46.3
Income (Loss) from Operations													$	1.0		$	(57.2	)	$	(81.8	)	$	(57.2	)	$	1.8
		Mar			Jun			Sep			Dec			Mar			Jun			Sep			Dec			Mar
For the Quarter Ended		2004			2004			2004			2004			2005			2005			2005			2005			2006
Operating Revenue by Source:
Lincoln Financial Advisors	$	92.0		$	96.0		$	91.7		$	103.9		$	128.1		$	125.2		$	124.5		$	136.2		$	121.4
Lincoln Financial Distributors		57.5			58.4			59.9			69.4			63.5			68.9			73.2			85.1			72.4
Total Distribution		149.6			154.4			151.6			173.2			191.6			194.1			197.7			221.3			193.8
Amortization of deferred gain on
indemnity reinsurance*		17.9			17.9			32.1			19.1			18.9			18.9			18.9			18.9			18.8
Other [Including
Consolidating Adjustments]		(111.3	)		(66.8	)		(91.2	)		(111.3	)		(136.7	)		(117.8	)		(122.8	)		(151.0	)		(128.6	)
Total Operating Revenue	$	56.1		$	105.5		$	92.4		$	81.1		$	73.8		$	95.2		$	93.8		$	89.2		$	83.9
Income from Operations by Source:
Lincoln Financial Advisors	$	(8.7	)	$	(5.3	)	$	(3.5	)	$	(0.3	)	$	(7.6	)	$	(4.4	)	$	(4.4	)	$	3.2		$	(3.8	)
Lincoln Financial Distributors		(4.6	)		(6.4	)		(6.3	)		(6.3	)		(6.0	)		(5.4	)		(7.9	)		(3.5	)		(6.0	)
Total Distribution		(13.3	)		(11.8	)		(9.8	)		(6.6	)		(13.6	)		(9.8	)		(12.3	)		(0.3	)		(9.8	)
Amortization of deferred gain on
indemnity reinsurance*		11.6			11.7			20.8			12.4			12.3			12.3			12.3			12.3			12.2
LNC Financing		(14.6	)		(15.7	)		(16.0	)		(14.6	)		(14.6	)		(14.5	)		(14.2	)		(14.4	)		(14.0	)
Other Corporate (1)		(4.0	)		(4.8	)		(5.0	)		2.5			4.7			21.1			11.3			9.1			(3.0	)
Income(Loss) from Operations	$	(20.3	)	$	(20.7	)	$	(9.9	)	$	(6.3	)	$	(11.3	)	$	9.2		$	(2.9	)	$	6.7		$	(14.6	)

* 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 $5.7 million in the 1st quarter of 2005, $23.5 million in the 2nd quarter of 2005, $13.3 million in the 3rd quarter of 2005, $4.3 million in the 4th quarter of 2005, $46.8 million for the full year 2005 and $4.4 million in the 4th quarter of 2004.

3/31/2006																									PAGE 36
Restructuring Charges (After-tax)
Unaudited [Millions of Dollars]
For the Year Ended December 31													2001			2002			2003			2004			2005
Lincoln Retirement													$	(1.3	)	$	(1.0	)	$	(13.1	)	$	(3.5	)	$	(11.3	)
Life Insurance														(3.5	)		-			(12.7	)		(3.1	)		(3.1	)
Investment Management														(0.4	)		0.3			(4.6	)		(0.8	)		0.2
Lincoln UK														-			1.7			-			-			-
Corporate & Other														(19.5	)		1.1			(4.7	)		(6.4	)		(4.9	)
Total													$	(24.7	)	$	2.0		$	(35.0	)	$	(13.9	)	$	(19.1	)
For the Quarter Ended		Mar			Jun			Sep			Dec			Mar			Jun			Sep			Dec			Mar
		2004			2004			2004			2004			2005			2005			2005			2005			2006
Lincoln Retirement	$	(1.2	)	$	(1.2	)	$	(1.7	)	$	0.5		$	(0.4	)	$	(10.0	)	$	(0.2	)	$	(0.7	)	$	(0.2	)
Life Insurance		(1.8	)		(0.4	)		(0.6	)		(0.4	)		(0.6	)		(2.4	)		(0.1	)		0.0			(0.0	)
Investment Management		(1.0	)		(0.0	)		(0.0	)		0.2			-			0.2			-			-			-
Lincoln UK		-			-			-			-			-			-			-			-			-
Corporate & Other		(3.6	)		(1.9	)		(0.7	)		(0.3	)		(0.2	)		(2.8	)		(1.5	)		(0.4	)		-
Total	$	(7.5	)	$	(3.5	)	$	(2.9	)	$	(0.0	)	$	(1.3	)	$	(15.0	)	$	(1.8	)	$	(1.1	)	$	(0.2	)

3/31/2006																									PAGE 37
Consolidated Domestic Deposits/Account Balances
Unaudited [Billions of Dollars]
													2001			2002			2003			2004			2005
Deposits - For the Year
Lincoln Retirement - Fixed Annuities													$	3.342		$	3.672		$	3.125		$	3.110		$	2.947
Lincoln Retirement - Variable Products(1)														3.067			2.743			3.119			5.910			7.362
Lincoln Retirement - Life Insurance														0.012			-			-			-			-
Life Insurance Segment - Life Insurance														1.934			2.138			2.259			2.243			2.240
Inv Mgmt - Annuities														1.701			2.751			2.151			2.757			2.957
Inv Mgmt - Mutual Funds														1.523			1.829			2.315			3.235			4.860
Inv Mgmt - Managed Acct. & Other														0.469			1.115			1.116			2.999			6.239
Consolidating Adjustments														(0.608	)		(1.576	)		(0.864	)		(0.975	)		(1.111	)
Total Gross Retail Deposits														11.439			12.671			13.222			19.280			25.494
Investment Management Segment- Instit.														3.826			5.194			5.859			11.289			14.633
Consolidating Adjustments														(0.207	)		(0.232	)		(0.150	)		(0.089	)		(0.086	)
Total Gross Deposits													$	15.058		$	17.634		$	18.931		$	30.479		$	40.041
Account Balances - End of Year
Lincoln Retirement - Fixed Annuities													$	16.491		$	18.085		$	18.868		$	19.268		$	18.856
Lincoln Retirement - Variable Products(1)														34.638			27.438			35.786			43.223			51.373
Lincoln Retirement - Life Insurance														0.149			-			-			-			-
Life Insurance Segment - Life Insurance														11.377			12.086			13.420			14.382			15.368
Inv Mgmt - Annuities														11.835			9.981			12.691			14.494			16.103
Inv Mgmt - Mutual Funds														11.554			10.296			12.614			13.251			15.679
Inv Mgmt - Managed Acct. & Other														1.719			2.270			3.768			6.642			12.893
Consolidating Adjustments														(6.676	)		(5.123	)		(6.553	)		(7.476	)		(8.269	)
Total Retail Account Balances														81.088			75.033			90.593			103.784			122.004
Investment Management Segment- Instit.														23.305			23.948			33.722			21.643			32.420
Consolidating Adjustments														(1.211	)		(0.924	)		(1.183	)		(1.248	)		(1.166	)
Total Account Balances													$	103.181		$	98.057		$	123.132		$	124.179		$	153.258
		Mar			Jun			Sep			Dec			Mar			Jun			Sep			Dec			Mar
		2004			2004			2004			2004			2005			2005			2005			2005			2006
Deposits - For the Quarter
Lincoln Retirement - Fixed Annuities	$	0.817		$	0.779		$	0.783		$	0.732		$	0.740		$	0.793		$	0.718		$	0.696		$	0.693
Lincoln Retirement - Variable Products(1)		1.407			1.424			1.424			1.655			1.899			1.736			1.785			1.942			2.195
Life Insurance Segment - Life Insurance		0.501			0.507			0.548			0.686			0.512			0.527			0.553			0.648			0.535
Inv Mgmt - Annuities		0.753			0.668			0.600			0.737			0.735			0.655			0.752			0.815			0.918
Inv Mgmt - Mutual Funds		0.905			0.729			0.680			0.922			1.336			1.255			1.159			1.110			1.094
Inv Mgmt - Managed Acct. & Other		0.793			0.721			0.625			0.860			1.310			2.123			1.573			1.232			1.769
Consolidating Adjustments		(0.271	)		(0.180	)		(0.223	)		(0.302	)		(0.282	)		(0.230	)		(0.343	)		(0.255	)		(0.214	)
Total Gross Retail Deposits		4.905			4.648			4.436			5.290			6.249			6.859			6.197			6.188			6.990
Investment Management Segment- Instit.		2.623			3.331			2.584			2.750			1.787			5.852			2.777			4.217			4.783
Consolidating Adjustments		(0.020	)		(0.035	)		(0.033	)		(0.002	)		(0.015	)		(0.034	)		(0.017	)		(0.020	)		(0.032	)
Total Gross Deposits	$	7.509		$	7.945		$	6.988		$	8.038		$	8.021		$	12.677		$	8.958		$	10.386		$	11.740
Account Balances - End of Quarter
Lincoln Retirement - Fixed Annuities	$	18.930		$	19.143		$	19.317		$	19.268		$	19.084		$	19.141		$	19.062		$	18.856		$	18.628
Lincoln Retirement - Variable Products(1)		37.619			38.398			38.698			43.223			43.673			45.751			48.731			51.373			55.072
Life Insurance Segment - Life Insurance		13.606			13.770			13.912			14.382			14.466			14.691			15.001			15.368			15.655
Inv Mgmt - Annuities		13.294			13.355			13.074			14.494			14.356			14.844			15.658			16.103			17.136
Inv Mgmt - Mutual Funds		13.199			12.971			12.234			13.251			13.478			14.385			15.173			15.679			16.583
Inv Mgmt - Managed Acct. & Other		4.366			5.051			5.374			6.642			7.638			9.492			11.679			12.893			15.109
Consolidating Adjustments		(6.881	)		(6.829	)		(7.216	)		(7.476	)		(7.758	)		(8.025	)		(7.967	)		(8.269	)		(8.855	)
Total Retail Account Balances		94.133			95.860			95.393			103.784			104.936			110.278			117.337			122.004			129.328
Investment Management Segment- Instit.		36.216			38.268			18.396			21.643			22.551			27.243			29.979			32.420			37.197
Consolidating Adjustments		(1.176	)		(1.168	)		(1.140	)		(1.248	)		(1.166	)		(1.198	)		(1.163	)		(1.166	)		(1.199	)
Total Account Balances	$	129.173		$	132.961		$	112.649		$	124.179		$	126.321		$	136.323		$	146.154		$	153.258		$	165.326

Total Domestic Net Flows
Unaudited [Billions of Dollars]
For the Year												2001			2002			2003			2004			2005
Lincoln Retirement(1)												$	0.105		$	0.453		$	1.007		$	2.922		$	2.887
Life Insurance Segment													1.163			1.320			1.377			1.247			1.356
Investment Management Segment- Retail													(0.375	)		0.806			1.271			3.136			7.098
Consolidating Adjustments													0.035			(0.082	)		0.064			0.030			(0.133	)
Total Retail Net Flows													0.927			2.496			3.719			7.335			11.207
Investment Management Segment- Institutional													(0.231	)		2.106			2.478			7.178			8.861
Consolidating Adjustments													(0.015	)		0.005			(0.002	)		0.031			0.170
Total Net Flows												$	0.681		$	4.608		$	6.195		$	14.545		$	20.238
		Mar			Jun			Sep			Dec		Mar			Jun			Sep			Dec			Mar
For the Quarter		2004			2004			2004			2004		2005			2005			2005			2005			2006
Lincoln Retirement(1)	$	0.712		$	0.701		$	0.716		$	0.794	$	0.776		$	0.857		$	0.633		$	0.621		$	0.858
Life Insurance Segment		0.248			0.291			0.300			0.408		0.260			0.309			0.337			0.450			0.297
Investment Management Segment- Retail		0.969			0.617			0.381			1.170		1.579			2.331			1.841			1.347			1.452
Consolidating Adjustments		(0.096	)		0.060			(0.089	)		0.154		(0.021	)		0.006			(0.049	)		(0.069	)		0.057
Total Retail Net Flows		1.832			1.669			1.308			2.527		2.593			3.504			2.762			2.348			2.664
Investment Management Segment- Instit.		1.661			2.043			1.379			2.095		1.217			4.108			1.606			1.930			3.551
Consolidating Adjustments		0.038			(0.001	)		(0.006	)		0.000		0.040			0.008			0.031			0.090			0.026
Total Net Flows	$	3.530		$	3.710		$	2.682		$	4.622	$	3.851		$	7.619		$	4.399		$	4.368		$	6.241
(1) Includes amounts attributable to Alliance program mutual fund net flows. Account values for the Alliance program are not included in the separate accounts reported on our balance sheet.
Amounts for the Investment Management segment exclude amounts reported as Assets Under Management - Insurance-related Assets.

3/31/2006																															PAGE 37A
Consolidated Domestic Deposits/Account Balances (excluding Assets  < /font>
Managed by Delaware's London-based International Investment Unit)  < /font>
Unaudited [Billions of Dollars]
																						2001			2002			2003			2004			2005
Deposits - For the Year
Lincoln Retirement - Fixed Annuities																						$	3.342		$	3.672		$	3.125		$	3.110		$	2.947
Lincoln Retirement - Variable Products(1)																							3.067			2.743			3.119			5.910			7.362
Lincoln Retirement - Life Insurance																							0.012			-			-			-			-
Life Insurance Segment - Life Insurance																							1.934			2.138			2.259			2.243			2.240
Inv Mgmt - Annuities																							1.701			2.456			2.140			2.752			2.957
Inv Mgmt - Mutual Funds																							1.523			1.829			2.315			3.235			4.860
Inv Mgmt - Managed Acct. & Other																							0.469			1.115			1.116			2.999			6.239
Consolidating Adjustments																							(0.608	)		(1.576	)		(0.864	)		(0.975	)		(1.111	)
Total Gross Retail Deposits																							11.439			12.376			13.210			19.274			25.494
Investment Management Segment- Instit.																							1.943			3.709			3.320			6.637			14.633
Consolidating Adjustments																							(0.207	)		(0.232	)		(0.150	)		(0.089	)		(0.086	)
Total Gross Deposits																						$	13.175		$	13.175		$	16.380		$	25.822		$	40.041
Account Balances - End of Year
Lincoln Retirement - Fixed Annuities																						$	16.491		$	18.085		$	18.868		$	19.268		$	18.856
Lincoln Retirement - Variable Products(1)																							34.638			27.438			35.786			43.223			51.373
Lincoln Retirement - Life Insurance																							0.149			-			-			-			-
Life Insurance Segment - Life Insurance																							11.377			12.086			13.420			14.382			15.368
Inv Mgmt - Annuities																							11.835			9.688			12.368			14.494			16.103
Inv Mgmt - Mutual Funds																							11.554			10.296			12.614			13.251			15.679
Inv Mgmt - Managed Acct. & Other																							1.719			2.270			3.768			6.642			12.893
Consolidating Adjustments																							(6.676	)		(5.123	)		(6.553	)		(7.476	)		(8.269	)
Total Retail Account Balances																							81.088			74.741			90.271			103.784			122.004
Investment Management Segment- Instit.																							11.562			12.348			16.299			21.643			32.420
Consolidating Adjustments																							(1.211	)		(0.924	)		(1.183	)		(1.248	)		(1.166	)
Total Account Balances																						$	91.439		$	86.165		$	105.387		$	124.179		$	153.258
		Jun			Sep			Dec			Mar			Jun			Sep			Dec			Mar			Jun			Sep			Dec			Mar
		2003			2003			2003			2004			2004			2004			2004			2005			2005			2005			2005			2006
Deposits - For the Quarter
Lincoln Retirement - Fixed Annuities	$	0.778		$	0.778		$	0.792		$	0.817		$	0.779		$	0.783		$	0.732		$	0.740		$	0.793		$	0.718		$	0.696		$	0.693
Lincoln Retirement - Variable Products(1)		0.584			0.800			1.087			1.407			1.424			1.424			1.655			1.899			1.736			1.785			1.942			2.195
Life Insurance Segment - Life Insurance		0.526			0.586			0.661			0.501			0.507			0.548			0.686			0.512			0.527			0.553			0.648			0.535
Inv Mgmt - Annuities		0.526			0.570			0.560			0.751			0.666			0.598			0.737			0.735			0.655			0.752			0.815			0.918
Inv Mgmt - Mutual Funds		0.558			0.644			0.663			0.905			0.729			0.680			0.922			1.336			1.255			1.159			1.110			1.094
Inv Mgmt - Managed Acct. & Other		0.196			0.277			0.441			0.793			0.721			0.625			0.860			1.310			2.123			1.573			1.232			1.769
Consolidating Adjustments		(0.211	)		(0.288	)		(0.193	)		(0.271	)		(0.180	)		(0.223	)		(0.302	)		(0.282	)		(0.230	)		(0.343	)		(0.255	)		(0.214	)
Total Gross Retail Deposits		2.958			3.367			4.010			4.903			4.646			4.435			5.290			6.249			6.859			6.197			6.188			6.990
Investment Management Segment- Instit.		0.466			1.088			0.874			1.206			1.372			1.309			2.750			1.787			5.852			2.777			4.217			4.783
Consolidating Adjustments		(0.025	)		(0.025	)		(0.047	)		(0.020	)		(0.035	)		(0.033	)		(0.002	)		(0.015	)		(0.034	)		(0.017	)		(0.020	)		(0.032	)
Total Gross Deposits	$	3.400		$	4.430		$	4.837		$	6.090		$	5.983		$	5.711		$	8.038		$	8.021		$	12.677		$	8.958		$	10.386		$	11.740
Account Balances - End of Quarter
Lincoln Retirement - Fixed Annuities	$	18.696		$	18.868		$	18.868		$	18.930		$	19.143		$	19.317		$	19.268		$	19.084		$	19.141		$	19.062		$	18.856		$	18.628
Lincoln Retirement - Variable Products(1)		30.457			31.709			35.786			37.619			38.398			38.698			43.223			43.673			45.751			48.731			51.373			55.072
Life Insurance Segment - Life Insurance		12.663			12.958			13.420			13.606			13.770			13.912			14.382			14.466			14.691			15.001			15.368			15.655
Inv Mgmt - Annuities		10.718			11.104			12.368			12.973			13.037			13.074			14.494			14.356			14.844			15.658			16.103			17.136
Inv Mgmt - Mutual Funds		11.356			11.615			12.614			13.199			12.971			12.234			13.251			13.478			14.385			15.173			15.679			16.583
Inv Mgmt - Managed Acct. & Other		2.737			3.037			3.768			4.366			5.051			5.374			6.642			7.638			9.492			11.679			12.893			15.109
Consolidating Adjustments		(5.628	)		(5.792	)		(6.553	)		(6.881	)		(6.829	)		(7.216	)		(7.476	)		(7.758	)		(8.025	)		(7.967	)		(8.269	)		(8.855	)
Total Retail Account Balances		80.999			83.499			90.271			93.812			95.542			95.393			103.784			104.936			110.278			117.337			122.004			129.328
Investment Management Segment- Instit.		13.943			14.660			16.299			17.215			17.414			18.396			21.643			22.551			27.243			27.243			32.420			37.197
Consolidating Adjustments		(1.049	)		(1.044	)		(1.183	)		(1.176	)		(1.168	)		(1.140	)		(1.248	)		(1.166	)		(1.198	)		(1.163	)		(1.166	)		(1.199	)
Total Account Balances	$	93.894		$	97.115		$	105.387		$	109.851		$	111.789		$	112.649		$	124.179		$	126.321		$	136.323		$	143.417		$	153.258		$	165.326

Total Domestic Net Flows (excluding Assets
Managed by Delaware's London-based International Investment Unit)
For the Year																					2001			2002			2003			2004			2005
Lincoln Retirement(1)																						0.105			0.453			1.007			2.922			2.887
Life Insurance Segment																						1.163			1.320			1.377			1.247			1.356
Investment Management Segment- Retail																						(0.375	)		0.517			1.325			3.160			7.098
Consolidating Adjustments																						0.035			(0.082	)		0.064			0.030			(0.133	)
Total Retail Net Flows																						0.927			2.207			3.773			7.359			11.207
Investment Management Segment- Institutional																						(0.925	)		1.885			1.433			3.884			8.861
Consolidating Adjustments																						(0.015	)		0.005			(0.002	)		0.031			0.170
Total Net Flows																					$	(0.013	)	$	4.097		$	5.203		$	11.274		$	20.238
		Jun			Sep			Dec			Mar			Jun			Sep			Dec		Mar			Jun			Sep			Dec			Mar
For the Quarter		2003			2003			2003			2004			2004			2004			2004		2005			2005			2005			2005			2006
Lincoln Retirement(1)	$	0.099		$	0.277		$	0.536		$	0.712		$	0.701		$	0.716		$	0.794	$	0.776		$	0.857		$	0.633		$	0.621		$	0.858
Life Insurance Segment		0.324			0.355			0.402			0.248			0.291			0.300			0.408		0.260			0.309			0.337			0.450			0.297
Investment Management Segment- Retail		0.304			0.375			0.598			0.980			0.624			0.386			1.170		1.579			2.331			1.841			1.347			1.452
Consolidating Adjustments		(0.003	)		(0.038	)		(0.058	)		(0.096	)		0.060			(0.089	)		0.154		(0.021	)		0.006			(0.049	)		(0.069	)		0.057
Total Retail Net Flows		0.725			0.970			1.478			1.843			1.676			1.313			2.527		2.593			3.504			2.762			2.348			2.664
Investment Management Segment- Instit.		(0.016	)		0.430			0.457			0.560			0.379			0.850			2.095		1.217			4.108			1.606			1.930			3.551
Consolidating Adjustments		0.009			0.035			(0.017	)		0.038			(0.001	)		(0.006	)		0.000		0.040			0.008			0.031			0.090			0.026
Total Net Flows	$	0.718		$	1.435		$	1.918		$	2.441		$	2.054		$	2.157		$	4.622	$	3.851		$	7.619		$	4.399		$	4.368		$	6.241

(1) Includes amounts attributable to Alliance program mutual fund net flows. Account values for the Alliance program are not included in the separate accounts reported on our balance sheet.

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.

Amounts for the Investment Management segment exclude amounts reported as Assets Under Management - Insurance-related Assets.

3/31/2006																	PAGE 38
Consolidated Investment Data - Assets Managed
Unaudited [Billions of Dollars]
For the Year Ended December 31									2001		2002		2003		2004		2005
Assets Managed by Source
LNC's Investments and Cash
Fixed maturity securities - available for sale									$	28.346	$	32.767	$	32.769	$	34.701	$	33.443
Equity securities - available for sale										0.470		0.337		0.199		0.161		0.145
Trading securities										-		-		3.120		3.237		3.246
Other investments										7.297		6.895		6.689		6.408		6.334
Total LNC Investments										36.113		40.000		42.778		44.507		43.168
Separate accounts										44.833		36.178		46.565		55.205		63.747
Cash and invested cash										3.095		1.691		1.711		1.662		2.312
Total LNC										84.042		77.869		91.054		101.374		109.227
Non-affiliate assets managed										38.421		38.052		49.587		42.966		62.491
Total Assets Managed									$	122.463	$	115.921	$	140.641	$	144.340	$	171.718
Assets Managed by Advisor
Investment Management segment									$	48.412	$	46.495	$	62.794	$	56.029	$	77.093
(See page 30 for additional detail)
DLIA-Corp										38.119		41.104		43.024		43.980		44.483
(Assets managed internally-see page 30)
Lincoln UK										6.847		6.351		7.668		8.599		8.562
Policy Loans (within business units)										1.940		1.946		1.924		1.871		1.862
Non-LNC Affiliates										27.145		20.026		25.231		33.862		39.718
Total Assets Managed									$	122.463	$	115.921	$	140.641	$	144.340	$	171.718
		Mar		Jun		Sep		Dec		Mar		Jun		Sep		Dec		Mar
For the Quarter Ended		2004		2004		2004		2004		2005		2005		2005		2005		2006
Assets Managed by Source
LNC's Investments and Cash:
Fixed maturity securities -
available for sale	$	33.667	$	32.808	$	34.223	$	34.701	$	34.225	$	34.975	$	34.325	$	33.443	$	32.893
Equity securities - available for sale		0.198		0.183		0.178		0.161		0.155		0.155		0.152		0.145		0.176
Trading securities		3.191		3.088		3.224		3.237		3.207		3.345		3.287		3.246		3.190
Other investments		6.446		6.284		6.302		6.408		6.396		6.389		6.322		6.334		6.314
Total LNC Investments		43.502		42.362		43.927		44.507		43.982		44.863		44.085		43.168		42.573
Separate accounts		48.558		49.344		49.658		55.205		55.387		57.240		60.812		63.747		67.984
Cash and invested cash		2.256		2.214		1.996		1.662		1.499		1.659		1.602		2.312		1.974
Total LNC		94.315		93.920		95.580		101.374		100.868		103.762		106.498		109.227		112.531
Non-affiliate assets managed		54.977		57.361		37.060		42.966		44.618		52.199		58.473		62.491		70.428
Total Assets Managed	$	149.292	$	151.281	$	132.640	$	144.340	$	145.487	$	155.961	$	164.972	$	171.718	$	182.959
Assets Managed by Advisor
Investment Management segment	$	67.075	$	69.643	$	49.076	$	56.029	$	58.022	$	65.963	$	72.488	$	77.093	$	86.021
(See page 31 for additional detail)
DLIA-Corp		44.006		42.528		44.047		43.980		44.210		45.219		44.503		44.483		43.430
(Assets managed internally-see page 31)
Lincoln UK		7.837		7.763		7.768		8.599		8.578		8.278		8.518		8.562		8.986
Policy Loans (within business units)		1.877		1.871		1.872		1.871		1.860		1.867		1.856		1.862		1.860
Non-LNC Affiliates		28.497		29.476		29.877		33.862		32.816		34.635		37.605		39.718		42.661
Total Assets Managed	$	149.292	$	151.281	$	132.640	$	144.340	$	145.487	$	155.961	$	164.972	$	171.718	$	182.959

3/31/2006																					PAGE 38A
Consolidated Investment Data - Assets Managed (excluding Assets& #160;
Managed by Delaware's London-based International Investment Unit)&# 160;
Unaudited [Billions of Dollars]
For the Year Ended December 31															2001		2002		2003		2004		2005
Assets Managed by Source
LNC's Investments and Cash
Fixed maturity securities - available for sale															$	28.346	$	32.767	$	32.769	$	34.701	$	33.443
Equity securities - available for sale																0.470		0.337		0.199		0.161		0.145
Trading securities																-		-		3.120		3.237		3.246
Other investments																7.297		6.895		6.689		6.408		6.334
Total LNC Investments																36.113		40.000		42.778		44.507		43.168
Separate accounts																44.833		36.178		46.565		55.205		63.747
Cash and invested cash																3.095		1.691		1.711		1.662		2.312
Total LNC																84.042		77.869		91.054		101.374		109.227
Non-affiliate assets managed																26.679		26.159		31.842		42.966		62.491
Total Assets Managed															$	110.721	$	104.028	$	122.896	$	144.340	$	171.718
Assets Managed by Advisor
Investment Management segment															$	36.670	$	34.602	$	45.049	$	56.029	$	77.093
(See page 30A for additional detail)
DLIA-Corp																38.119		41.104		43.024		43.980		44.483
(Assets managed internally-see page 30A)
Lincoln UK																6.847		6.351		7.668		8.599		8.562
Policy Loans (within business units)																1.940		1.946		1.924		1.871		1.862
Non-LNC Affiliates																27.145		20.026		25.231		33.862		39.718
Total Assets Managed															$	110.721	$	104.028	$	122.896	$	144.340	$	171.718
		Jun		Sep		Dec		Mar		Jun		Sep		Dec		Mar		Jun		Sep		Dec		Mar
For the Quarter Ended		2003		2003		2003		2004		2004		2004		2004		2005		2005		2005		2005		2006
Assets Managed by Source
LNC's Investments and Cash:
Fixed maturity securities -
available for sale	$	35.355	$	35.384	$	32.769	$	33.667	$	32.808	$	34.223	$	34.701	$	34.225	$	34.975	$	34.325	$	33.443	$	32.893
Equity securities - available for sale		0.257		0.243		0.199		0.198		0.183		0.178		0.161		0.155		0.155		0.152		0.145		0.176
Trading securities		-		-		3.120		3.191		3.088		3.224		3.237		3.207		3.345		3.287		3.246		3.190
Other investments		6.980		6.796		6.689		6.446		6.284		6.302		6.408		6.396		6.389		6.322		6.334		6.314
Total LNC Investments		42.592		42.423		42.778		43.502		42.362		43.927		44.507		43.982		44.863		44.085		43.168		42.573
Separate accounts		39.943		41.283		46.565		48.558		49.344		49.658		55.205		55.387		57.240		60.812		63.747		67.984
Cash and invested cash		1.946		1.961		1.711		2.256		2.214		1.996		1.662		1.499		1.659		1.602		2.312		1.974
Total LNC		84.480		85.667		91.054		94.315		93.920		95.580		101.374		100.868		103.762		106.498		109.227		112.531
Non-affiliate assets managed		29.216		30.463		31.842		35.655		36.190		37.060		42.966		44.618		52.199		58.473		62.491		70.428
Total Assets Managed	$	113.696	$	116.131	$	122.896	$	129.970	$	130.110	$	132.641	$	144.340	$	145.486	$	155.961	$	164.972	$	171.718	$	182.959
Assets Managed by Advisor
Investment Management segment	$	38.755	$	40.416	$	45.049	$	47.753	$	48.471	$	49.076	$	56.029	$	58.022	$	65.963	$	72.488	$	77.093	$	86.021
(See page 31A for additional detail)
DLIA-Corp		43.857		42.984		43.024		44.006		42.528		44.047		43.980		44.210		45.219		44.503		44.483		43.430
(Assets managed internally-see page 31A)
Lincoln UK		6.726		6.887		7.668		7.837		7.763		7.768		8.599		8.578		8.278		8.518		8.562		8.986
Policy Loans (within business units)		1.920		1.910		1.924		1.877		1.871		1.872		1.871		1.860		1.867		1.856		1.862		1.860
Non-LNC Affiliates		22.439		23.933		25.231		28.497		29.476		29.878		33.862		32.816		34.635		37.605		39.718		42.661
Total Assets Managed	$	113.696	$	116.131	$	122.896	$	129.970	$	130.110	$	132.641	$	144.340	$	145.486	$	155.961	$	164.972	$	171.718	$	182.959

NOTE: 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.

3/31/2006																									PAGE 39
Consolidated Investment Data
Unaudited [Millions of Dollars]
For the Year Ended December 31													2001			2002			2003			2004			2005
Net Investment Income
Fixed maturity AFS securities													$	2,121.0		$	2,117.0		$	2,113.2		$	2,005.7		$	2,030.5
Equity AFS securities														17.6			15.4			12.3			10.9			9.6
Trading securities														-			-			46.5			193.5			193.7
Mortgage loans on real estate														374.5			356.8			338.3			350.1			287.6
Real estate														49.5			47.4			43.9			26.9			50.1
Policy loans														125.3			134.5			123.2			119.8			118.4
Invested cash														68.4			37.6			7.8			32.2			63.0
Other investments														69.4			16.3			48.8			55.3			61.1
Investment revenue														2,825.9			2,725.0			2,734.0			2,794.4			2,813.9
Investment expense														(117.1	)		(93.1	)		(95.4	)		(90.3	)		(111.6	)
Net Investment Income														2,708.7			2,631.9			2,638.5			2,704.1			2,702.3
Gross-up of Tax Exempt Income														7.2			7.5			7.7			7.7			7.1
Adjusted Net Investment Income													$	2,715.9		$	2,639.4		$	2,646.2		$	2,711.8		$	2,709.4
Mean Invested Assets (Amortized Cost)													$	37,616.9		$	38,828.5		$	41,042.8		$	43,216.4		$	43,933.3
Ratio of Adjusted Net Invest Income
Over Mean Invested Assets														7.22	%		6.80	%		6.45	%		6.27	%		6.17	%
Investment Gains (Losses)
Realized Gains (Losses) on Investments													$	(68.7	)	$	(177.2	)	$	(11.0	)	$	(30.0	)	$	(14.5	)
Gains(Losses) on Derivatives														(4.9	)		0.8			(1.6	)		(7.4	)		(0.0	)
Incr (Decr) in Unreal Gains on Sec
Avail-for-Sale (after DAC/Tax)														183.7			557.7			39.8			29.8			(326.3	)
Incr (Decr) on Derivatives														21.4			24.4			(6.3	)		(8.1	)		(6.7	)
Available-for-Sale and Trading Securities
[Billions of Dollars]
Fixed Maturity Sec (Fair Value)														28.346			32.767			35.887			37.936			36.687
Fixed Maturity Sec (Amortized Cost)														27.956			31.103			33.743			35.692			35.348
Equity Securities (Fair Value)														0.470			0.337			0.201			0.163			0.147
Equity Securities (Amortized Cost)														0.444			0.334			0.176			0.148			0.139
% of AFS Fixed Maturity Securities (Based on Fair Value)
Treasuries and AAA														17.2	%		20.1	%		22.8	%		23.5	%		23.4	%
AA or better														23.6	%		25.8	%		29.3	%		29.9	%		30.9	%
BB or less														8.3	%		6.6	%		6.8	%		7.0	%		7.4	%
		Mar			Jun			Sep			Dec			Mar			Jun			Sep			Dec			Mar
For the Quarter Ended		2004			2004			2004			2004			2005			2005			2005			2005			2006
Net Investment Income
Fixed maturity AFS securities	$	493.0		$	496.4		$	501.5		$	514.8		$	505.1		$	509.8		$	505.7		$	509.7		$	513.7
Equity AFS securities		2.4			2.0			2.2			4.4			1.8			2.0			2.4			3.3			2.1
Trading securities		47.5			48.6			47.7			49.7			47.6			48.8			48.6			48.7			49.7
Mortgage loans on real estate		100.4			92.1			83.8			73.8			70.9			70.7			70.9			75.1			67.2
Real estate		7.6			5.9			8.0			5.4			4.3			31.7			8.5			5.6			9.1
Policy loans		29.2			29.6			29.7			31.3			29.6			29.8			29.8			29.2			29.7
Invested cash		3.5			5.2			5.6			17.9			12.7			14.0			17.0			19.2			22.8
Other investments		15.0			23.8			14.0			2.4			13.5			24.2			16.4			7.0			14.6
Investment revenue		698.6			703.6			692.4			699.8			685.6			731.1			699.3			697.9			708.8
Investment expense		(21.0	)		(20.5	)		(23.0	)		(25.7	)		(25.8	)		(27.5	)		(28.5	)		(29.8	)		(30.4	)
Net Investment Income		677.5			683.1			669.4			674.1			659.8			703.6			670.8			668.1			678.3
Gross-up of Tax Exempt Income		1.7			1.6			1.7			2.6			1.6			1.6			1.8			2.1			1.5
Adjusted Net Invest Income	$	679.3		$	684.8		$	671.1		$	676.6		$	661.4		$	705.2		$	672.6		$	670.2		$	679.9
Mean Invested Assets (Amortized Cost)	$	42,615.7		$	42,987.4		$	43,499.3		$	43,763.4		$	43,851.9		$	43,806.2		$	44,040.1		$	44,035.2		$	44,363.6
Ratio of Adjusted Net Invest Inc
Over Mean Invested Assets		6.38	%		6.37	%		6.17	%		6.18	%		6.03	%		6.44	%		6.11	%		6.09	%		6.13	%
Investment Gains (Losses)
Realized Gains (Losses) on Investments		(7.9	)		(11.6	)		(14.5	)		3.9			(6.0	)		(0.2	)		(2.0	)		(6.2	)		(7.2	)
Gains (Losses) on Derivatives		(2.5	)		(1.8	)		(3.4	)		0.3			1.4			(2.5	)		0.9			0.1			2.7
Incr (Decr) in Unreal Gains on Sec
Avail-for-Sale (after DAC/Tax)		244.9			(626.0	)		368.1			42.8			(240.0	)		268.4			(282.2	)		(72.4	)		(276.4	)
Incr (Decr) on Derivatives		6.9			(10.5	)		1.3			(5.8	)		(6.3	)		4.2			(3.0	)		(1.5	)		27.8
Available-for-Sale and Trading Securities
[Billions of Dollars]
Fixed Maturity Sec (Fair Value)		36.856			35.894			37.444			37.936			37.429			38.318			37.610			36.687			36.081
Fixed Maturity Sec (Amortized Cost)		34.031			34.648			35.256			35.692			35.849			35.977			36.049			35.348			35.497
Equity Securities (Fair Value)		0.200			0.185			0.180			0.163			0.157			0.157			0.154			0.147			0.178
Equity Securities (Amortized Cost)		0.171			0.162			0.156			0.148			0.145			0.144			0.141			0.139			0.160
% of AFS Fixed Maturity Securities (Based on Fair Value)
Treasuries and AAA		23.4	%		23.3	%		23.6	%		23.5	%		24.4	%		24.8	%		24.5	%		23.4	%		23.4	%
AA or better		29.6	%		29.5	%		29.7	%		29.9	%		32.2	%		32.1	%		31.9	%		30.9	%		31.0	%
BB or less		6.9	%		7.1	%		6.9	%		7.0	%		6.2	%		6.5	%		7.3	%		7.4	%		7.5	%

3/31/2006																															PAGE 40
Common Stock / Debt Information
Unaudited [Dollars per Share, except Percentages]
For the Year Ended December 31				1995			1996			1997			1998			1999			2000			2001			2002			2003			2004			2005
Common Stock [1]
Highest Price				$	26.875		$	28.500		$	39.063		$	49.438		$	57.500		$	56.375		$	52.750		$	53.650		$	41.320		$	50.380		$	54.410
Lowest Price					17.313			20.375			24.500			33.500			36.000			22.625			38.000			25.150			24.730			40.060			41.590
Closing Price					26.875			26.250			39.063			40.907			40.000			47.313			48.570			31.580			40.370			46.680			53.030
Dividend Payout Ratio [2]					39.7	%		38.2	%		22.8	%		43.9	%		50.5	%		38.3	%		44.9	%		273.5	%		49.1	%		37.0	%		32.2	%
Yield [3]					3.4	%		3.7	%		2.7	%		2.7	%		2.9	%		2.6	%		2.6	%		4.2	%		3.5	%		3.1	%		2.8	%
Preferred Stock Dividend (Millions)				$	8.644		$	0.112		$	0.106		$	0.100		$	0.089		$	0.078		$	0.071		$	0.061		$	0.057		$	0.052		$	0.048
Debt: (End of Period)
Senior Debt Ratings
A.M. Best																				a			a			a			a-			a-			a-
Fitch					AA-			AA-			AA-			A+			A+			A+			A+			A			A			A			A
Moody's					A2			A2			A2			A2			A2			A3			A3			A3			A3			A3			A3
Standard & Poors					A			A			A			A-			A-			A-			A-			A-			A-			A-			A-
Claims Paying Ratings:
Lincoln Life - A.M. Best					A+			A+			A+			A			A			A			A			A+			A+			A+			A+
Lincoln Life - Fitch					AA+			AA+			AA+			AA+			AA+			AA			AA			AA			AA			AA			AA
Lincoln Life - Moody's					Aa3			Aa3			Aa3			Aa3			Aa3			Aa3			Aa3			Aa3			Aa3			Aa3			Aa3
Lincoln Life - Standard & Poors					AA-			AA-			AA-			AA-			AA-			AA-			AA-			AA-			AA-			AA-			AA-
First Penn - A.M. Best*					A+			A+			A+			A			A			A			A			A+			A+			A+			A+
First Penn - Fitch											AA+			AA+			AA+			AA			AA			AA			AA			AA			AA
First Penn - Moody's											A1			A1			A1			A1			A1			A1			A1			A1			A1
First Penn - Standard & Poors*					AA-			AA-			AA-			AA-			AA-			AA-			AA-			AA-			AA-			AA-			AA-
LLA of New York - A.M. Best*								A+			A+			A			A			A			A			A+			A+			A+			A+
LLA of New York - Fitch*											AA+			AA+			AA+			AA			AA			AA			AA			AA			AA
LLA of New York - Moody's								A1			A1			A1			A1			A1			A1			A1			A1			A1			A1
LLA of New York - Standard & Poors*								AA-			AA-			AA-			AA-			AA-			AA-			AA-			AA-			AA-			AA-
Ratios
Debt to Total Capitalization [4]					22.8	%		18.8	%		17.0	%		21.2	%		23.2	%		20.8	%		21.3	%		23.4	%		20.7	%		20.9	%		17.6	%
Debt to Equity [4]					29.5	%		23.1	%		20.5	%		26.9	%		30.3	%		26.3	%		27.0	%		30.5	%		26.1	%		26.5	%		21.3	%
	Jun				Sep			Dec			Mar			Jun			Sep			Dec			Mar			Jun			Sep			Dec			Mar
For the Quarter Ended		2003			2003			2003			2004			2004			2004			2004			2005			2005			2005			2005			2006
Common Stock:
Highest Price	$	37.500		$	38.640		$	41.320		$	48.870		$	50.380		$	47.500		$	48.700		$	49.420		$	47.770		$	52.420		$	54.410		$	57.970
Lowest Price		27.870			34.630			35.410			40.060			43.260			41.900			40.790			44.360			41.590			46.590			46.940			52.000
Closing Price		35.630			35.380			40.370			47.320			47.250			47.000			46.680			45.140			46.920			52.020			53.030			54.590
Yield [3]		3.8	%		3.8	%		3.5	%		3.0	%		3.0	%		3.0	%		3.1	%		3.2	%		3.1	%		2.8	%		2.9	%		2.8	%
Preferred Stock Dividend	$	0.014		$	0.016		$	0.014		$	0.013		$	0.013		$	0.013		$	0.013		$	0.012		$	0.012		$	0.012		$	0.012		$	0.011
(Millions)
Debt: (End of Period)
Senior Debt Ratings
A.M. Best		a			a			a-			a-			a-			a-			a-			a-			a-			a-			a-			a-	(5)
Fitch		A			A			A			A			A			A			A			A			A			A			A			A
Moody's		A3			A3			A3			A3			A3			A3			A3			A3			A3			A3			A3			A3
Standard & Poors		A-			A-			A-			A-			A-			A-			A-			A-			A-			A-			A-			A-	(5)
Claims Paying Ratings:
Lincoln Life - A.M. Best		A+			A+			A+			A+			A+			A+			A+			A+			A+			A+			A+			A+
Lincoln Life - Fitch		AA			AA			AA			AA			AA			AA			AA			AA			AA			AA			AA			AA
Lincoln Life - Moody's		Aa3			Aa3			Aa3			Aa3			Aa3			Aa3			Aa3			Aa3			Aa3			Aa3			Aa3			Aa3
Lincoln Life - Standard & Poors		AA-			AA-			AA-			AA-			AA-			AA-			AA-			AA-			AA-			AA-			AA-			AA-	(6)
First Penn - A.M. Best*		A+			A+			A+			A+			A+			A+			A+			A+			A+			A+			A+			A+
First Penn - Fitch		AA			AA			AA			AA			AA			AA			AA			AA			AA			AA			AA			AA
First Penn - Moody's		A1			A1			A1			A1			A1			A1			A1			A1			A1			A1			A1			A1
First Penn - Standard & Poors*		AA-			AA-			AA-			AA-			AA-			AA-			AA-			AA-			AA-			AA-			AA-			AA-
LLA of New York - A.M. Best*		A+			A+			A+			A+			A+			A+			A+			A+			A+			A+			A+			A+
LLA of New York - Fitch*		AA			AA			AA			AA			AA			AA			AA			AA			AA			AA			AA			AA
LLA of New York - Moody's		A1			A1			A1			A1			A1			A1			A1			A1			A1			A1			A1			A1	(7)
LLA of New York - Standard & Poors*		AA-			AA-			AA-			AA-			AA-			AA-			AA-			AA-			AA-			AA-			AA-			AA-	(7)
Ratios
Debt to Total Capitalization [4]		22.3	%		21.5	%		20.7	%		22.8	%		22.6	%		22.0	%		20.9	%		20.3	%		19.9	%		18.6	%		17.6	%		15.9	%
Debt to Equity [4]		28.7	%		27.5	%		26.1	%		29.5	%		29.1	%		28.1	%		26.5	%		25.5	%		24.8	%		22.9	%		21.3	%		18.9	%
* Rating based on affiliation with Lincoln Life

[1] Stock prices include the 2-for-1split in June 1999

[2] Indicated dividend divided by net income

[3] Indicated dividend divided by the closing price

[4] Equity used in calculation excludes accumulated other comprehensive income (loss). Junior subordinated debentures issued to affiliated trusts (hybrid securities) are considered 50% debt and 50% equity.

(5) On April 3, 2006, the A.M. Best and Standard & Poor's Senior Debt ratings improved to "a" and "A+," respectively.

(6) On April 3, 2006, the Lincoln Life Standard & Poor's rating improved to "AA."

(7) On April 3, 2006, the LLA of New York Moody's and Standard & Poor's ratings improved to "Aa3" and "AA," respectively.

 

3/31/2006				PAGE 41
JEFFERSON-PILOT CORPORATION AND SUBSIDIARIES
FINANCIAL HIGHLIGHTS
Unaudited Millions of Dollars
	For the Quarter Ended March 31
	2006			2005
	Amount			Amount
NET INCOME BY SOURCES
Individual Products	$	74.3		$	84.3
Annuity and Investment Products		24.7			21.7
Benefit Partners		29.5			33.8
Communications		11.2			11.0
Corporate and Other		3.2			6.9
Total reportable segment results		142.9			157.7
Realized investment gains (losses), net of taxes		(4.6	)		3.5
Net income	$	138.3		$	161.2
PERFORMANCE RATIOS (Annualized)
Return on average equity (1)		16.0	%		19.2	%
(1) Calculated as total reportable segment results divided by average equity (excluding accumulated other comprehensive income).
Net income for the three months ended March 31, 2006 includes after-tax expenses of $5 million from the implementation of Statement of Financial Accounting Standards No. 123R "Share Based Payment" and a $7 million favorable tax adjustment. Jefferson Pilot previously used the intrinsic value method under Accounting Principles Board Opinion No. 25 "Accounting for Stock Issued to Employees" to account for stock options granted to employees and directors and recognized no expense. Refer to the Notes to Financial Statement to the Jefferson-Pilot Corporation March 31, 2006 Consolidated Financial Statements included in our Current Report on Form 8-K filed May 2, 2006. The favorable tax adjustment results from resolution with the Internal Revenue Service of the 2000 through 2003 Federal income tax examination.
Net income for the three months ended March 31, 2005 includes a $19 million favorable after-tax adjustment from management actions to reduce bonuses on certain older in-force universal life insurance policies. Also included in first quarter 2005 net income are favorable after-tax adjustments of approximately $13 million that reflect Benefit Partners' active management and administrative streamlining of the acquired Canadian Life block, as well as quite favorable loss experience across all blocks.

3/31/2006				PAGE 42
JEFFERSON-PILOT CORPORATION AND SUBSIDIARIES
PERFORMANCE MEASURES
Unaudited Millions of Dollars
	For the Quarter Ended March 31
	2006			2005
	Amount			Amount
INDIVIDUAL PRODUCTS
Annualized life insurance premium sales:
Individual Markets excluding Community Banks and BOLI	$	52.1		$	57.2
Community Banks and BOLI		0.6			0.1
	$	52.7		$	57.3
Average UL policyholder fund balances	$	11,898.0		$	11,410.3
Average VUL separate account assets		1,866.9			1,663.3
	$	13,764.9		$	13,073.6
Average face amount of insurance in force:
Total	$	169,188.0		$	165,929.0
UL-Type Contracts	$	131,507.0		$	128,397.0
Average assets	$	19,815.3		$	18,870.5
ANNUITY AND INVESTMENT PRODUCTS
Fixed annuity premium sales	$	220.2		$	244.3
Variable annuity premium sales		0.1			0.1
Total	$	220.3		$	244.4
Investment product sales	$	1,665.0		$	1,297.0
Average fixed policyholder fund balances	$	9,385.4		$	9,445.5
Average separate account policyholder fund balances		268.5			311.9
Average funding agreement balances		300.0			-
	$	9,953.9		$	9,757.4
Effective investment spreads for fixed annuities and funding agreements		2.03	%		2.13	%
Effective investment spreads for fixed annuities and funding agreements, excluding gross FAS 133 impact		1.78	%		1.85	%
FAS 133 adjustment, net of DAC effect and income taxes	$	1.9		$	2.5
Fixed annuity surrenders as a % of beginning fund balance		19.1	%		12.4	%
Fixed annuity general and administrative expenses as a % of average invested assets		0.23	%		0.17	%
Average assets	$	10,730.8		$	10,523.5
BENEFIT PARTNERS
Life, Disability and Dental annualized sales	$	64.0		$	70.5
Premiums and other considerations:
Life	$	117.2		$	108.4
Disability		134.0			117.1
Dental		32.8			32.0
Other		35.0			32.0
Total	$	319.0		$	289.5
Loss ratios:
Life		71.6	%		59.6	%
Disability		63.0	%		60.2	%
Dental		78.7	%		78.9	%
Combined		68.4	%		62.3	%
Gross general and administrative expenses as a % of premium income		10.1	%		9.3	%
Total expenses as a % of premium income		24.4	%		25.3	%

3/31/2006				PAGE 43
JEFFERSON-PILOT CORPORATION AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF INCOME
Unaudited Millions of Dollars
	For the Quarter Ended March 31
	2006			2005
	Amount			Amount
REVENUE
Premiums and other considerations	$	364.4		$	331.3
Universal life and investment product charges		197.1			199.7
Net investment income		438.1			408.3
Realized investment gains (losses)		(7.1	)		5.5
Communications sales		61.4			60.5
Broker-dealer concessions and other		35.6			31.9
Total revenue		1,089.5			1,037.2
BENEFITS AND EXPENSES
Insurance and annuity benefits		612.9			537.4
Insurance commissions, net of deferrals		69.6			65.6
General and administrative expenses, net of deferrals		54.1			38.6
Insurance taxes, licenses and fees		23.3			22.7
Amortization of policy acquisition costs and
value of business acquired		79.2			77.9
Interest expense		16.6			13.8
Communications operations		38.8			37.8
Total benefits and expenses		894.5			793.8
Income before income taxes		195.0			243.4
Income taxes		56.7			82.2
Net income	$	138.3		$	161.2

3/31/06																									PAGE 44
JEFFERSON-PILOT CORPORATION AND SUBSIDIARIES
QUARTERLY CONSOLIDATED STATEMENTS OF INCOME
Unaudited Millions of Dollars
	For the Quarter Ended
	Mar			Dec			Sep			Jun			Mar			Dec			Sep			Jun			Mar
	2006			2005			2005			2005			2005			2004			2004			2004			2004
REVENUE
Premiums and other considerations	$	364.4		$	341.1		$	330.8		$	352.5		$	331.3		$	332.9		$	327.6		$	352.3		$	279.8
UL & Investment product charges		197.1			197.8			194.5			191.2			199.7			188.2			179.1			183.6			181.6
Net investment income		438.1			428.9			428.8			424.5			408.3			445.3			406.6			413.2			406.5
Realized investment gains (losses)		(7.1	)		8.6			(7.4	)		4.5			5.5			3.6			3.5			10.2			23.5
Communications sales		61.4			69.3			59.2			57.2			60.5			68.0			58.1			56.5			58.1
Broker-dealer concessions and other		35.6			34.5			33.2			33.4			31.9			30.1			27.2			31.5			35.4
Total revenue		1,089.5			1,080.2			1,039.1			1,063.2			1,037.2			1,068.1			1,002.1			1,047.2			984.8
BENEFITS AND EXPENSES
Insurance and annuity benefits		612.9			597.8			580.9			601.4			537.4			586.1			574.3			585.3			541.0
Insurance commissions, net of deferrals		69.6			65.3			64.9			67.1			65.6			61.3			62.0			67.4			59.7
General and administrative expenses, net of deferrals		54.1			43.4			47.6			47.6			38.6			49.9			48.1			47.4			37.6
Insurance taxes, licenses and fees		23.3			18.0			20.9			20.0			22.7			19.9			16.4			19.7			17.4
Amortization of policy acquisition costs and
value of business acquired		79.2			79.8			82.1			78.2			77.9			89.3			56.5			74.9			66.8
Interest expense		16.6			16.4			15.1			14.8			13.8			13.2			12.5			11.7			10.7
Communications operations		38.8			36.2			32.2			29.4			37.8			36.2			30.8			29.3			36.7
Total benefits and expenses		894.5			857.0			843.8			858.5			793.8			855.8			800.6			835.6			769.9
Income before taxes		195.0			223.2			195.3			204.7			243.4			212.2			201.5			211.6			214.9
Income taxes		56.7			73.5			64.5			67.9			82.2			66.6			67.7			69.5			73.7
Cumulative effect of change in accounting for long-duration contracts,
net of taxes		-			-			-			-			-			-			-			-			(16.6	)
Net Income	$	138.3		$	149.7		$	130.9		$	136.8		$	161.2		$	145.7		$	133.8		$	142.0		$	124.6
QUARTERLY RETURN ON EQUITY		16.0	%		16.9	%		16.2	%		16.1	%		19.2	%		17.9	%		16.9	%		17.4	%		16.2	%

3/31/2006				PAGE 45
JEFFERSON-PILOT CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
Unaudited Millions of Dollars
	For the Quarter Ended March 31
	2006			2005
	Amount			Amount
ASSETS
Cash and investments	$	27,558.1		$	28,140.6
Accrued investment income		354.8			345.0
Due from reinsurers		1,295.8			1,317.9
Deferred policy acquisition costs		2,491.7			2,346.0
Value of business acquired		495.2			476.0
Goodwill		311.9			311.9
Other assets		671.9			673.3
Assets held in separate accounts		2,573.7			2,467.6
Total assets	$	35,753.1		$	36,078.3
LIABILITIES
Policy liabilities	$	27,119.6		$	27,092.2
Debt:
Commercial paper borrowings		-			260.3
Obligations under repurchase agreements		432.4			451.6
Notes payable		599.7			599.7
Junior subordinated debentures		309.3			309.3
Income tax liabilities		456.9			537.7
Accounts payable, accruals and other liabilities		393.9			443.0
Liabilities related to separate accounts		2,573.7			2,467.6
Total liabilities		31,885.5			32,161.4
STOCKHOLDERS' EQUITY
Common stock and paid in capital		232.0			185.8
Retained earnings		3,431.5			3,293.3
Accumulated other comprehensive income:
Net unrealized gains:
Bonds, net of DAC, VOBA and taxes		(57.5	)		178.4
Equities, net of taxes		274.4			272.0
Other		(12.8	)		(12.6	)
Total accumulated other comprehensive income		204.1			437.8
Total stockholders' equity		3,867.6			3,916.9
Total liabilities and stockholders' equity	$	35,753.1		$	36,078.3

3/31/06																							PAGE 46
JEFFERSON-PILOT CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
Unaudited Millions of Dollars
	For the Quarter Ended
	Mar			Dec			Sep			Jun			Mar			Dec			Sep		Jun		Mar
	2006			2005			2005			2005			2005			2004			2004		2004		2004
ASSETS
Cash and investments	$	27,558.1		$	28,140.6		$	28,073.9		$	28,346.6		$	27,599.3		$	27,655.0		$	27,393.0	$	26,583.7	$	27,156.2
Accrued investment income		354.8			345.0			355.4			348.4			355.2			341.6			350.2		338.6		337.5
Due from reinsurers		1,295.8			1,317.9			1,305.3			1,313.8			1,321.7			1,341.4			1,333.2		1,355.9		1,321.7
Deferred policy acquisition costs		2,491.7			2,346.0			2,240.9			2,058.7			2,090.8			1,957.8			1,932.0		1,978.4		1,745.4
Value of business acquired		495.2			476.0			463.0			440.6			485.9			472.2			454.1		507.4		449.4
Goodwill, net		311.9			311.9			311.9			311.9			311.9			311.9			311.9		311.9		311.9
Other assets		671.9			673.3			659.2			653.8			661.9			651.6			679.1		685.2		633.4
Separate account assets		2,573.7			2,467.6			2,431.4			2,354.4			2,324.3			2,373.4			2,192.3		2,234.4		2,228.7
Total Assets	$	35,753.1		$	36,078.3		$	35,841.1		$	35,828.2		$	35,151.1		$	35,104.8		$	34,645.7	$	33,995.6	$	34,184.4
LIABILITIES
Policy liabilities	$	27,119.6		$	27,092.2		$	26,905.2		$	26,807.4		$	26,347.3		$	26,165.9		$	25,958.5	$	25,711.9	$	25,317.0
Debt:
Commercial paper borrowings		-			260.3			224.0			197.6			154.3			187.7			174.1		187.3		154.0
Long-term notes payable		599.7			599.7			599.7			599.7			599.7			599.6			599.6		599.6		599.6
Obligations under repurchase agreements		432.4			451.6			499.5			401.0			537.5			468.3			494.5		509.4		454.0
Junior subordinated debentures		309.3			309.3			309.3			309.3			309.3			309.3			309.3		309.3		309.3
Income tax liabilities		456.9			537.7			531.7			151.6			594.2			619.9			629.5		476.6		615.1
Accrued expenses and other liabilities		393.9			443.0			482.0			444.7			453.2			446.9			458.9		447.2		536.6
Separate account liabilities		2,573.7			2,467.6			2,431.4			2,354.4			2,324.3			2,373.4			2,192.3		2,234.4		2,228.7
Total Liabilities		31,885.5			32,161.4			31,982.9			31,265.6			31,319.8			31,170.9			30,816.7		30,475.8		30,214.2
STOCKHOLDERS' EQUITY
Common stock and paid in capital		232.0			185.8			168.3			167.9			170.5			180.6			172.4		170.6		174.8
Retained earnings		3,431.5			3,293.3			3,200.0			3,163.9			3,150.8			3,070.5			2,976.9		2,898.7		2,966.5
Accumulated other comprehensive income -
primarily net unrealized gains on securities		204.1			437.8			489.9			728.7			510.0			682.8			679.7		450.5		828.9
Total Stockholders' Equity		3,867.6			3,916.9			3,858.2			4,060.5			3,831.3			3,933.9			3,829.0		3,519.8		3,970.2
Total Liabilities and Stockholders' Equity	$	35,753.1		$	36,078.3		$	35,841.1		$	35,326.1		$	35,151.1		$	35,104.8		$	34,645.7	$	33,995.6	$	34,184.4
COMPONENTS OF EQUITY
Common stock and paid in capital	$	232.0		$	185.8		$	168.3		$	167.9		$	170.5		$	180.6		$	172.4	$	170.6	$	174.8
Retained earnings		3,431.5			3,293.3			3,200.0			3,163.9			3,150.8			3,070.5			2,976.9		2,898.7		2,966.5
Accumulated other comprehensive income
Net unrealized gains
Bonds, net of DAC, VOBA and taxes		(57.5	)		178.4			246.3			458.8			260.0			402.5			411.7		185.1		545.3
Equities, net of taxes		274.4			272.0			254.6			281.6			260.8			289.9			268.0		265.3		283.6
Other		(12.8	)		(12.6	)		(11.0	)		(11.7	)		(10.8	)		(9.7	)		-		-		-
Total accumulated other comprehensive income		204.1			437.8			489.9			728.7			510.0			682.8			679.7		450.5		828.9
Stockholders' equity	$	3,867.6		$	3,916.9		$	3,858.2		$	4,060.5		$	3,831.3		$	3,933.9		$	3,829.0	$	3,519.8	$	3,970.2