10-Q

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C.  20549

FORM 10-Q

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

For the Quarterly Period Ended March 31, 2013

OR

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

For the Transition Period from                 to            

Commission File No.  033-28976

RIVERSOURCE LIFE INSURANCE COMPANY

(Exact name of registrant as specified in its charter)

Minnesota	41-0823832
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

1099 Ameriprise Financial Center, Minneapolis, Minnesota	55474
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code:  (612) 671-3131

Former name, former address and former fiscal year, if changed since last report:  Not Applicable

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

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes  x    No  o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company.  See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large Accelerated Filer o	Accelerated Filer o
Non-Accelerated Filer x (Do not check if a smaller reporting company)	Smaller reporting company o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  Yes  o    No  x

Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

Class	Outstanding at May 1, 2013
Common Stock (par value $30 per share)	100,000 shares

THE REGISTRANT MEETS THE CONDITIONS SET FORTH IN GENERAL INSTRUCTIONS H(1) (a) AND (b) OF FORM 10-Q AND IS THEREFORE FILING THIS FORM WITH THE REDUCED DISCLOSURE FORMAT.

RIVERSOURCE LIFE INSURANCE COMPANY

FORM 10-Q

INDEX

Part I.	Financial Information:
	Item 1.	Financial Statements
		Consolidated Balance Sheets — March 31, 2013 and December 31, 2012	1
		Consolidated Statements of Income — Three months ended March 31, 2013 and 2012	2
		Consolidated Statements of Comprehensive Income — Three months ended March 31, 2013 and 2012	2
		Consolidated Statements of Shareholder’s Equity — Three months ended March 31, 2013 and 2012	3
		Consolidated Statements of Cash Flows — Three months ended March 31, 2013 and 2012	4
		Notes to Consolidated Financial Statements	5
	Item 2.	Management’s Narrative Analysis	29
	Item 4.	Controls and Procedures	35
Part II.	Other Information:
	Item 1.	Legal Proceedings	36
	Item 1A.	Risk Factors	36
	Item 6.	Exhibits	36
	Signatures		37
	Exhibit Index		E-1

RIVERSOURCE LIFE INSURANCE COMPANY

PART I.  FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS

CONSOLIDATED BALANCE SHEETS

(in millions, except share amounts)

	March 31, 2013		December 31, 2012
	(unaudited)
Assets
Investments:
Available-for-Sale:
Fixed maturities, at fair value (amortized cost: 2013, $22,711; 2012, $23,058)	$	25,368	$	25,932
Common stocks, at fair value (cost: 2013 and 2012, $2)	4		4
Mortgage loans, at amortized cost (less allowance for loan losses: 2013 and 2012, $26)	3,365		3,389
Policy loans	752		752
Other investments	750		743
Total investments	30,239		30,820
Cash and cash equivalents	150		336
Restricted cash	75		86
Reinsurance recoverables	2,082		2,047
Other receivables	151		203
Accrued investment income	277		291
Deferred acquisition costs	2,409		2,373
Deferred sales inducement costs	397		404
Other assets	3,521		3,793
Separate account assets	72,532		69,395
Total assets	$	111,833	$	109,748
Liabilities and Shareholder’s Equity
Liabilities:
Future policy benefits	$	29,979	$	30,670
Policy claims and other policyholders’ funds	145		132
Short-term borrowings	500		501
Line of credit with Ameriprise Financial, Inc.	150		150
Other liabilities	3,989		4,201
Separate account liabilities	72,532		69,395
Total liabilities	107,295		105,049
Shareholder’s equity:
Common stock, $30 par value; 100,000 shares authorized, issued and outstanding	3		3
Additional paid-in capital	2,462		2,462
Retained earnings	915		1,000
Accumulated other comprehensive income, net of tax	1,158		1,234
Total shareholder’s equity	4,538		4,699
Total liabilities and shareholder’s equity	$	111,833	$	109,748

See Notes to Consolidated Financial Statements.

1

RIVERSOURCE LIFE INSURANCE COMPANY

CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)

(in millions)

	Three Months Ended March 31,
	2013			2012
Revenues
Premiums	$	108		$	112
Net investment income	358			377
Policy and contract charges	416			395
Other revenues	88			77
Net realized investment gains (losses)	(1		)	3
Total revenues	969			964
Benefits and expenses
Benefits, claims, losses and settlement expenses	235			350
Interest credited to fixed accounts	198			206
Amortization of deferred acquisition costs	59			17
Other insurance and operating expenses	183			201
Total benefits and expenses	675			774
Pretax income	294			190
Income tax provision	54			19
Net income	$	240		$	171
Supplemental Disclosures:
Total other-than-temporary impairment losses on securities	$	(1	)	$	(3	)
Portion of gain recognized in other comprehensive income (before taxes)	—			2
Net impairment losses recognized in net realized investment gains (losses)	$	(1	)	$	(1	)

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED)

(in millions)

	Three Months Ended March 31,
	2013			2012
Net income	$	240		$	171
Other comprehensive income (loss), net of tax:
Net unrealized gains (losses) on securities:
Net unrealized securities gains (losses) arising during the period	(141		)	42
Reclassification of net securities gains included in net income	—			(2		)
Impact on deferred acquisition costs, deferred sales inducement costs, benefit reserves and reinsurance recoverables	64			(3		)
Total net unrealized gains (losses) on securities	(77		)	37
Net unrealized losses on derivatives:
Reclassification of net derivative losses included in net income	1			1
Total net unrealized losses on derivatives	1			1
Total other comprehensive income (loss), net of tax	(76		)	38
Total comprehensive income	$	164		$	209

See Notes to Consolidated Financial Statements.

2

RIVERSOURCE LIFE INSURANCE COMPANY

CONSOLIDATED STATEMENTS OF SHAREHOLDER’S EQUITY (UNAUDITED)
(in millions)

	Common Shares		Additional Paid-In Capital		Retained Earnings			Accumulated Other Comprehensive Income			Total
Balances at January 1, 2012	$	3	$	2,461	$	1,215		$	931		$	4,610
Comprehensive income:
Net income	—		—		171			—			171
Other comprehensive income, net of tax	—		—		—			38			38
Total comprehensive income											209
Cash dividend to Ameriprise Financial, Inc.	—		—		(225		)	—			(225		)
Balances at March 31, 2012	$	3	$	2,461	$	1,161		$	969		$	4,594
Balances at January 1, 2013	$	3	$	2,462	$	1,000		$	1,234		$	4,699
Comprehensive income:
Net income	—		—		240			—			240
Other comprehensive loss, net of tax	—		—		—			(76		)	(76		)
Total comprehensive income											164
Cash dividend to Ameriprise Financial, Inc.	—		—		(325		)	—			(325		)
Balances at March 31, 2013	$	3	$	2,462	$	915		$	1,158		$	4,538

See Notes to Consolidated Financial Statements.

3

 RIVERSOURCE LIFE INSURANCE COMPANY

CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

(in millions)

	Three Months Ended March 31,
	2013			2012
Cash Flows from Operating Activities
Net income	$	240		$	171
Adjustments to reconcile net income to net cash used in operating activities:
Depreciation, amortization and accretion, net	(6		)	(3		)
Deferred income tax expense (benefit)	85			(135		)
Contractholder and policyholder charges, non-cash	(69		)	(67		)
Loss from equity method investments	7			8
Net realized investment gains	(1		)	(4		)
Other-than-temporary impairments and provision for loan losses recognized in net realized investment gains (losses)	2			1
Change in operating assets and liabilities:
Deferred acquisition costs	(3		)	(50		)
Deferred sales inducement costs	10			—
Future policy benefits for traditional life, disability income and long term care insurance	52			65
Policy claims and other policyholders’ funds	13			14
Reinsurance recoverables	(33		)	(34		)
Other receivables	19			(51		)
Accrued investment income	14			17
Derivatives collateral, net	(102		)	(530		)
Other, net	(286		)	530
Net cash used in operating activities	(58		)	(68		)
Cash Flows from Investing Activities
Available-for-Sale securities:
Proceeds from sales	45			78
Maturities, sinking fund payments and calls	997			794
Purchases	(689		)	(1,016		)
Proceeds from sales, maturities and repayments of mortgage loans	178			43
Funding of mortgage loans	(148		)	(62		)
Proceeds from sales of other investments	35			31
Purchase of other investments	(67		)	(67		)
Purchase of land, buildings, equipment and software	(1		)	(3		)
Net cash provided by (used in) investing activities	350			(202		)
Cash Flows from Financing Activities
Policyholder and contractholder account values:
Considerations received	303			392
Net transfers to separate accounts	(36		)	(9		)
Surrenders and other benefits	(321		)	(335		)
Change in short-term borrowings, net	(1		)	—
Proceeds from line of credit with Ameriprise Financial, Inc.	—			100
Payments on line of credit with Ameriprise Financial, Inc.	—			(100		)
Deferred premium options, net	(98		)	(76		)
Cash dividend to Ameriprise Financial, Inc.	(325		)	(225		)
Net cash used in financing activities	(478		)	(253		)
Net decrease in cash and cash equivalents	(186		)	(523		)
Cash and cash equivalents at beginning of period	336			828
Cash and cash equivalents at end of period	$	150		$	305
Supplemental Disclosures:
Income taxes paid (received), net	$	(3	)	$	46
Interest paid on borrowings	1			1
Non-cash investing activity:
Affordable housing partnership commitments not yet remitted	10			—

See Notes to Consolidated Financial Statements.

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RIVERSOURCE LIFE INSURANCE COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

1.Basis of Presentation

RiverSource Life Insurance Company is a stock life insurance company with two wholly owned subsidiaries, RiverSource Life Insurance Co. of New York and RiverSource Tax Advantaged Investments, Inc. (“RTA”).  RiverSource Life Insurance Company is a wholly owned subsidiary of Ameriprise Financial, Inc. (“Ameriprise Financial”).

The accompanying Consolidated Financial Statements include the accounts of RiverSource Life Insurance Company and companies in which it directly or indirectly has a controlling financial interest (collectively, the “Company”). All intercompany transactions and balances have been eliminated in consolidation.

The interim financial information in this report has not been audited.  In the opinion of management, all adjustments necessary for a fair presentation of the consolidated financial position and results of operations for the interim periods have been made.   All adjustments made were of a normal recurring nature.

The accompanying Consolidated Financial Statements are prepared in accordance with U.S. generally accepted accounting principles (“GAAP”). Certain reclassifications of prior period amounts have been made to conform to the current presentation.  Results of operations reported for interim periods are not necessarily indicative of results for the entire year.  These Consolidated Financial Statements and Notes should be read in conjunction with the Consolidated Financial Statements and Notes in the Company’s Annual Report on Form 10-K for the year ended December 31, 2012, filed with the Securities and Exchange Commission on February 26, 2013.

The Company evaluated events or transactions that may have occurred after the balance sheet date for potential recognition or disclosure through the date the financial statements were issued.

2.Recent Accounting Pronouncements

Adoption of New Accounting Standards

Comprehensive Income

In February 2013, the Financial Accounting Standards Board (“FASB”) updated the accounting standard related to comprehensive income. The update requires entities to provide information about significant amounts reclassified out of accumulated other comprehensive income (“AOCI”). The standard is effective for interim and annual periods beginning after December 15, 2012 and is required to be applied prospectively. The Company adopted the standard in the first quarter of 2013. The adoption of the standard did not have any effect on the Company’s consolidated financial condition and results of operations. See Note 13 for the required disclosures.

Balance Sheet

In December 2011, the FASB updated the accounting standards to require new disclosures about offsetting assets and liabilities. The standard requires an entity to disclose both gross and net information about certain financial instruments and transactions subject to master netting arrangements (or similar agreements) or eligible for offset in the statement of financial position. The standard is effective for interim and annual periods beginning on or after January 1, 2013 on a retrospective basis. The Company adopted the standard in the first quarter of 2013. The adoption of the standard did not have any effect on the Company’s consolidated financial condition and results of operations. See Note 11 for the required disclosures.

Accounting for Costs Associated with Acquiring or Renewing Insurance Contracts

In October 2010, the FASB updated the accounting standard for deferred acquisition costs (“DAC”). Under this new standard, only the following costs incurred in the acquisition of new and renewal insurance contracts are capitalizable as DAC: (i) incremental direct costs of a successful contract acquisition, (ii) portions of employees’ compensation and benefits directly related to time spent performing acquisition activities (that is, underwriting, policy issuance and processing, medical and inspection, and contract selling) for a contract that has been acquired, (iii) other costs related to  acquisition activities that would not have been incurred had the acquisition of the contract not occurred, and (iv) advertising costs that meet the capitalization criteria in other GAAP guidance for certain direct-response marketing. All other acquisition related costs are expensed as incurred. The Company retrospectively adopted the new standard on January 1, 2012. The cumulative effect of the adoption reduced retained earnings by $1.4 billion after-tax and increased AOCI by $112 million after-tax, totaling to a $1.3 billion after-tax reduction in total equity at January 1, 2012.

5

RIVERSOURCE LIFE INSURANCE COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)

3.Variable Interest Entities

RTA, a subsidiary of RiverSource Life Insurance Company, has variable interests in affordable housing partnerships for which it is not the primary beneficiary and, therefore, does not consolidate.

RTA’s maximum exposure to loss as a result of its investments in the affordable housing partnerships is limited to the carrying values of these investments.  The carrying values are reflected in other investments and were $410 million and $409 million as of March 31, 2013 and December 31, 2012, respectively.  RTA has no obligation to provide financial or other support to the affordable housing partnerships in addition to liabilities already recorded for future funding commitments nor has it provided any additional support to the affordable housing partnerships.  The Company had liabilities of $123 million and $144 million recorded in other liabilities as of March 31, 2013 and December 31, 2012, respectively, related to the future funding commitments for affordable housing partnerships.

4.Investments

Available-for-Sale securities distributed by type were as follows:

	March 31, 2013
Description of Securities	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value		Noncredit OTTI(1)
	(in millions)
Fixed maturities:
Corporate debt securities	$	14,725	$	2,005	$	(10	)	$	16,720	$	2
Residential mortgage backed securities	3,419		210		(52		)	3,577		(21		)
Commercial mortgage backed securities	2,578		248		(1		)	2,825		—
State and municipal obligations	967		178		(28		)	1,117		—
Asset backed securities	797		72		(2		)	867		—
Foreign government bonds and obligations	184		30		—			214		—
U.S. government and agencies obligations	41		7		—			48		—
Total fixed maturities	22,711		2,750		(93		)	25,368		(19		)
Common stocks	2		2		—			4		1
Total	$	22,713	$	2,752	$	(93	)	$	25,372	$	(18	)

	December 31, 2012
Description of Securities	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value		Noncredit OTTI(1)
	(in millions)
Fixed maturities:
Corporate debt securities	$	14,881	$	2,167	$	(7	)	$	17,041	$	—
Residential mortgage backed securities	3,446		233		(58		)	3,621		(24		)
Commercial mortgage backed securities	2,717		287		—			3,004		—
State and municipal obligations	976		180		(34		)	1,122		—
Asset backed securities	808		66		(3		)	871		—
Foreign government bonds and obligations	188		36		—			224		—
U.S. government and agencies obligations	42		7		—			49		—
Total fixed maturities	23,058		2,976		(102		)	25,932		(24		)
Common stocks	2		2		—			4		1
Total	$	23,060	$	2,978	$	(102	)	$	25,936	$	(23	)

(1)Represents the amount of other-than-temporary impairment (“OTTI”) losses in accumulated other comprehensive income.  Amount includes unrealized gains and losses on impaired securities subsequent to the initial impairment measurement date.  These amounts are included in gross unrealized gains and losses as of the end of the period.

At both March 31, 2013 and December 31, 2012, fixed maturity securities comprised approximately 84% of the Company’s total investments.  Rating agency designations are based on the availability of ratings from Nationally Recognized Statistical Rating Organizations (“NRSROs”), including Moody’s Investors Service (“Moody’s”), Standard & Poor’s Ratings Services (“S&P”) and Fitch Ratings Ltd. (“Fitch”).  The Company uses the median of available ratings from Moody’s, S&P and Fitch, or if fewer than three ratings are available, the lower rating is used. When ratings from Moody’s, S&P and Fitch are unavailable, the Company may utilize ratings from other NRSROs or rate the securities internally. At March 31, 2013 and

6

RIVERSOURCE LIFE INSURANCE COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)

December 31, 2012, approximately $1.4 billion and $1.5 billion, respectively, of securities were internally rated by Columbia Management Investment Advisers, LLC using criteria similar to those used by NRSROs.

A summary of fixed maturity securities by rating was as follows:

	March 31, 2013						December 31, 2012
Ratings	Amortized Cost		FairValue		Percent of Total Fair Value		Amortized Cost		FairValue		Percent of Total Fair Value
	(in millions, except percentages)
AAA	$	5,405	$	5,846	23	%	$	5,680	$	6,198	24	%
AA	1,173		1,381		5		1,102		1,273		5
A	4,338		4,944		20		4,262		4,849		19
BBB	10,269		11,670		46		10,409		12,019		46
Below investment grade	1,526		1,527		6		1,605		1,593		6
Total fixed maturities	$	22,711	$	25,368	100	%	$	23,058	$	25,932	100	%

At March 31, 2013 and December 31, 2012, approximately 34% and 32%, respectively, of the securities rated AAA were GNMA, FNMA and FHLMC mortgage backed securities.  No holdings of any other issuer were greater than 10% of total equity.

The following tables provide information about Available-for-Sale securities with gross unrealized losses and the length of time that individual securities have been in a continuous unrealized loss position:

	March 31, 2013
	Less than 12 months						12 months or more						Total
Description of Securities	Number of Securities	Fair Value		Unrealized Losses			Number of Securities	Fair Value		Unrealized Losses			Number of Securities	Fair Value		Unrealized Losses
	(in millions, except number of securities)
Corporate debt securities	50	$	546	$	(7	)	5	$	49	$	(3	)	55	$	595	$	(10	)
Residential mortgage backed securities	16	320		(5		)	51	250		(47		)	67	570		(52		)
State and municipal obligations	—	—		—			2	105		(28		)	2	105		(28		)
Asset backed securities	2	12		—			4	59		(2		)	6	71		(2		)
Commercial mortgage backed securities	6	48		(1		)	—	—		—			6	48		(1		)
Total	74	$	926	$	(13	)	62	$	463	$	(80	)	136	$	1,389	$	(93	)

	December 31, 2012
	Less than 12 months						12 months or more						Total
Description of Securities	Number of Securities	Fair Value		Unrealized Losses			Number of Securities	Fair Value		Unrealized Losses			Number of Securities	Fair Value		Unrealized Losses
	(in millions, except number of securities)
Corporate debt securities	50	$	477	$	(4	)	6	$	70	$	(3	)	56	$	547	$	(7	)
Residential mortgage backed securities	6	107		—			56	293		(58		)	62	400		(58		)
State and municipal obligations	—	—		—			2	100		(34		)	2	100		(34		)
Asset backed securities	1	10		—			5	86		(3		)	6	96		(3		)
Total	57	$	594	$	(4	)	69	$	549	$	(98	)	126	$	1,143	$	(102	)

As part of the Company’s ongoing monitoring process, management determined that a majority of the gross unrealized losses on its Available-for-Sale securities are attributable to movement in credit spreads primarily related to non-agency residential mortgage backed securities purchased prior to 2008.

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RIVERSOURCE LIFE INSURANCE COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)

The following table presents a rollforward of the cumulative amounts recognized in the Consolidated Statements of Income for other-than-temporary impairments related to credit losses on securities for which a portion of the securities’ total other-than-temporary impairments was recognized in other comprehensive income:

	Three Months Ended March 31,
	2013			2012
	(in millions)
Beginning balance	$	87		$	106
Credit losses for which an other-than-temporary impairment was previously recognized	1			1
Reductions for securities sold during the period (realized)	(13		)	(2		)
Ending balance	$	75		$	105

The change in net unrealized securities gains (losses) in other comprehensive income includes three components, net of tax: (i) unrealized gains (losses) that arose from changes in the market value of securities that were held during the period; (ii) (gains) losses that were previously unrealized, but have been recognized in current period net income due to sales of Available-for-Sale securities and due to the reclassification of noncredit other-than-temporary impairment losses to credit losses and (iii) other items primarily consisting of adjustments in asset and liability balances, such as DAC, deferred sales inducement costs (“DSIC”), benefit reserves and reinsurance recoverables, to reflect the expected impact on their carrying values had the unrealized gains (losses) been realized as of the respective balance sheet dates.

The following table presents a rollforward of the net unrealized securities gains on Available-for-Sale securities included in accumulated other comprehensive income:

	NetUnrealizedSecuritiesGains			DeferredIncome Tax			Accumulated OtherComprehensive Income Related to Net Unrealized Securities Gains
	(in millions)
Balance at January 1, 2012	$	1,472		$	(515	)	$	957
Net unrealized securities gains arising during the period(1)	65			(23		)	42
Reclassification of net securities gains included in net income	(3		)	1			(2		)
Impact on DAC, DSIC, benefit reserves and reinsurance recoverables	(5		)	2			(3		)
Balance at March 31, 2012	$	1,529		$	(535	)	$	994	(2)
Balance at January 1, 2013	$	1,930		$	(675	)	$	1,255
Net unrealized securities losses arising during the period(1)	(217		)	76			(141		)
Reclassification of net securities losses included in net income	1			(1		)	—
Impact on DAC, DSIC, benefit reserves and reinsurance recoverables	98			(34		)	64
Balance at March 31, 2013	$	1,812		$	(634	)	$	1,178	(2)

(1)Includes other-than-temporary impairment losses on Available-for-Sale securities related to factors other than credit that were recognized in other comprehensive income during the period.

(2)Includes $(12) million and $(18) million of noncredit related impairments on securities and net unrealized securities losses on previously impaired securities at March 31, 2013 and 2012, respectively.

Net realized gains and losses on Available-for-Sale securities, determined using the specific identification method, recognized in net realized investment gains (losses) were as follows:

	Three Months Ended March 31,
	2013			2012
	(in millions)
Gross realized investment gains	$	—		$	4
Other-than-temporary impairments	(1		)	(1		)
Total	$	(1	)	$	3

Other-than-temporary impairments for the three months ended March 31, 2013 and 2012 primarily related to credit losses on non-agency residential mortgage backed securities.

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RIVERSOURCE LIFE INSURANCE COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)

Available-for-Sale securities by contractual maturity at March 31, 2013 were as follows:

	Amortized Cost		Fair Value
	(in millions)
Due within one year	$	1,547	$	1,581
Due after one year through five years	4,099		4,437
Due after five years through 10 years	6,716		7,627
Due after 10 years	3,555		4,454
	15,917		18,099
Residential mortgage backed securities	3,419		3,577
Commercial mortgage backed securities	2,578		2,825
Asset backed securities	797		867
Common stocks	2		4
Total	$	22,713	$	25,372

Actual maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations.  Residential mortgage backed securities, commercial mortgage backed securities and asset backed securities are not due at a single maturity date.  As such, these securities, as well as common stocks, were not included in the maturities distribution.

Net investment income is summarized as follows:

	Three Months Ended March 31,
	2013		2012
	(in millions)
Income on fixed maturities	$	309	$	342
Income on mortgage loans	51		35
Other investments	6		6
	366		383
Less: investment expenses	8		6
Total	$	358	$	377

5.Financing Receivables

The Company’s financing receivables include commercial and residential mortgage loans, syndicated loans and policy loans.  Syndicated loans are reflected in other investments.  Policy loans do not exceed the cash surrender value of the policy at origination.  As there is minimal risk of loss related to policy loans, the Company does not record an allowance for loan losses for policy loans.

Allowance for Loan Losses

The following tables present a rollforward of the allowance for loan losses for the three months ended and the ending balance of the allowance for loan losses by impairment method and type of loan:

	March 31, 2013						March 31, 2012
	Commercial Mortgage Loans		Syndicated Loans		Total		Commercial Mortgage Loans		Syndicated Loans			Total
	(in millions)
Beginning balance	$	26	$	4	$	30	$	32	$	5		$	37
Charge-offs	—		—		—		—		(1		)	(1		)
Provisions	—		—		—		—		—			—
Ending balance	$	26	$	4	$	30	$	32	$	4		$	36
Individually evaluated for impairment	$	5	$	—	$	5	$	9	$	—		$	9
Collectively evaluated for impairment	21		4		25		23		4			27

9

RIVERSOURCE LIFE INSURANCE COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)

The recorded investment in financing receivables by impairment method and type of loan was as follows:

	March 31, 2013
	Commercial Mortgage Loans		Residential Mortgage Loans		Syndicated Loans		Total
	(in millions)
Individually evaluated for impairment	$	46	$	—	$	2	$	48
Collectively evaluated for impairment	2,455		890		292		3,637
Total	$	2,501	$	890	$	294	$	3,685

	December 31, 2012
	Commercial Mortgage Loans		Residential Mortgage Loans		Syndicated Loans		Total
	(in millions)
Individually evaluated for impairment	$	39	$	—	$	—	$	39
Collectively evaluated for impairment	2,442		934		303		3,679
Total	$	2,481	$	934	$	303	$	3,718

As of March 31, 2013 and December 31, 2012, the Company’s recorded investment in financing receivables individually evaluated for impairment for which there was no related allowance for loan losses was $12 million and $10 million, respectively.

Residential mortgage loans are presented net of unamortized discount of $72 million and $80 million as of March 31, 2013 and December 31, 2012, respectively.

Purchases and sales of syndicated loans were as follows:

	Three Months Ended March 31,
	2013		2012
	(in millions)
Purchases	$	22	$	29
Sales	1		—

Credit Quality Information

Nonperforming loans, which are generally loans 90 days or more past due, were $10 million and $4 million as of March 31, 2013 and December 31, 2012, respectively.  All other loans were considered to be performing.

Commercial Mortgage Loans

The Company reviews the credit worthiness of the borrower and the performance of the underlying properties in order to determine the risk of loss on commercial mortgage loans.  Based on this review, the commercial mortgage loans are assigned an internal risk rating, which management updates as necessary. Commercial mortgage loans which management has assigned its highest risk rating were 2% of total commercial mortgage loans at both March 31, 2013 and December 31, 2012. Loans with the highest risk rating represent distressed loans which the Company has identified as impaired or expects to become delinquent or enter into foreclosure within the next six months. In addition, the Company reviews the concentrations of credit risk by region and property type.

10

RIVERSOURCE LIFE INSURANCE COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)

Concentrations of credit risk of commercial mortgage loans by U.S. region were as follows:

	Loans				Percentage
	March 31, 2013		December 31, 2012		March 31, 2013		December 31, 2012
	(in millions)
South Atlantic	$	644	$	625	26	%	25	%
Pacific	575		565		23		23
Mountain	266		262		11		11
East North Central	255		255		10		10
West North Central	205		216		8		9
Middle Atlantic	196		198		8		8
West South Central	162		159		6		6
New England	130		135		5		5
East South Central	68		66		3		3
	2,501		2,481		100	%	100	%
Less: allowance for loan losses	26		26
Total	$	2,475	$	2,455

Concentrations of credit risk of commercial mortgage loans by property type were as follows:

	Loans				Percentage
	March 31, 2013		December 31, 2012		March 31, 2013		December 31, 2012
	(in millions)
Retail	$	853	$	822	34	%	33	%
Office	590		597		24		24
Industrial	439		449		18		18
Apartments	423		415		17		17
Hotel	35		36		1		1
Mixed use	33		42		1		2
Other	128		120		5		5
	2,501		2,481		100	%	100	%
Less: allowance for loan losses	26		26
Total	$	2,475	$	2,455

Residential Mortgage Loans

In October 2012, the Company purchased $954 million of residential mortgage loans at fair value from an affiliate, Ameriprise Bank, FSB.  The purchase price takes into account the credit quality of the loan portfolio resulting in no allowance for loan losses recorded at purchase. The Company considers the credit worthiness of borrowers (FICO score), collateral characteristics such as loan-to-value (“LTV”) and geographic concentration to determine when an amount for an allowance for loan losses for residential mortgage loans is appropriate.  At a minimum, management updates FICO scores and LTV ratios semiannually.  As of March 31, 2013 and December 31, 2012, no allowance for loan losses was recorded.

As of March 31, 2013 and December 31, 2012, approximately 4% and 3%, respectively, of residential mortgage loans had FICO scores below 640.  At March 31, 2013 and December 31, 2012, approximately 1% and 7%, respectively, of the Company’s residential mortgage loans had LTV ratios greater than 90%.  The Company’s most significant geographic concentration for residential mortgage loans is in California representing 38% of the portfolio as of both March 31, 2013 and December 31, 2012.  No other state represents more than 10% of the total residential mortgage loan portfolio.

Syndicated Loans

The Company’s syndicated loan portfolio is diversified across industries and issuers.  The primary credit indicator for syndicated loans is whether the loans are performing in accordance with the contractual terms of the syndication. Total nonperforming syndicated loans at both March 31, 2013 and December 31, 2012 were $2 million.

11

RIVERSOURCE LIFE INSURANCE COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)

Troubled Debt Restructurings

The following table presents the number of loans restructured by the Company during the three months ended March 31 and their recorded investment at March 31:

	2013			2012
	Number of Loans	Recorded Investment		Number of Loans	Recorded Investment
	(in millions, except number of loans)
Residential mortgage loans	2	$	—	—	$	—
Syndicated loans	—	—		1	1
Total	2	$	—	1	$	1

The troubled debt restructurings did not have a material impact to the Company’s allowance for loan losses or income recognized for the three months ended March 31, 2013 and 2012. There are no material commitments to lend additional funds to borrowers whose loans have been restructured.

6.Deferred Acquisition Costs and Deferred Sales Inducement Costs

The balances of and changes in DAC were as follows:

	2013			2012
	(in millions)
Balance at January 1	$	2,373		$	2,413
Capitalization of acquisition costs	62			67
Amortization	(59		)	(17		)
Impact of change in net unrealized securities losses (gains)	33			(19		)
Balance at March 31	$	2,409		$	2,444

The balances of and changes in DSIC were as follows:

	2013			2012
	(in millions)
Balance at January 1	$	404		$	464
Capitalization of sales inducement costs	2			2
Amortization	(12		)	(2		)
Impact of change in net unrealized securities losses (gains)	3			(4		)
Balance at March 31	$	397		$	460

7.Future Policy Benefits, Policy Claims and Other Policyholders’ Funds and Separate Account Liabilities

Future policy benefits and policy claims and other policyholders’ funds consisted of the following:

	March 31, 2013		December 31, 2012
	(in millions)
Fixed annuities	$	15,905	$	16,075
Equity indexed annuity (“EIA”) accumulated host values	29		31
EIA embedded derivatives	3		2
Variable annuity fixed sub-accounts	4,832		4,843
Variable annuity guaranteed minimum withdrawal benefits (“GMWB”)	319		799
Variable annuity guaranteed minimum accumulation benefits (“GMAB”)	23		103
Other variable annuity guarantees	13		13
Total annuities	21,124		21,866
Variable universal life (“VUL”)/universal life (“UL”) insurance	2,767		2,760
Indexed universal life (“IUL”) accumulated host values	74		59
IUL embedded derivatives	61		45
VUL/UL insurance additional liabilities	296		294
Other life, disability income and long term care insurance	5,657		5,646
Total future policy benefits	29,979		30,670
Policy claims and other policyholders’ funds	145		132
Total future policy benefits and policy claims and other policyholders’ funds	$	30,124	$	30,802

12

RIVERSOURCE LIFE INSURANCE COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)

Separate account liabilities consisted of the following:

	March 31, 2013		December 31, 2012
	(in millions)
Variable annuity variable sub-accounts	$	66,121	$	63,302
VUL insurance variable sub-accounts	6,368		6,051
Other insurance variable sub-accounts	43		42
Total	$	72,532	$	69,395

8.Variable Annuity and Insurance Guarantees

The majority of the variable annuity contracts offered by the Company contain guaranteed minimum death benefit (“GMDB”) provisions.  The Company also offers variable annuities with death benefit provisions that gross up the amount payable by a certain percentage of contract earnings, which are referred to as gain gross-up (“GGU”) benefits.  In addition, the Company offers contracts with GMWB and GMAB provisions.  The Company previously offered contracts containing guaranteed minimum income benefit (“GMIB”) provisions.

Certain UL policies offered by the Company provide secondary guarantee benefits.  The secondary guarantee ensures that, subject to specified conditions, the policy will not terminate and will continue to provide a death benefit even if there is insufficient policy value to cover the monthly deductions and charges.

The following table provides information related to variable annuity guarantees for which the Company has established additional liabilities:

	March 31, 2013							December 31, 2012
Variable Annuity Guarantees by Benefit Type (1)	Total Contract Value		Contract Value in Separate Accounts		Net Amount at Risk(2)		Weighted Average Attained Age	Total Contract Value		Contract Value in Separate Accounts		Net Amount at Risk(2)		Weighted Average Attained Age
	(in millions, except age)
GMDB:
Return of premium	$	48,049	$	46,289	$	41	63	$	45,697	$	43,942	$	61	63
Five/six-year reset	11,382		8,874		78		63	11,233		8,722		115		63
One-year ratchet	7,552		7,126		61		65	7,367		6,933		106		65
Five-year ratchet	1,681		1,627		2		61	1,616		1,563		3		61
Other	978		952		48		68	912		885		62		68
Total — GMDB	$	69,642	$	64,868	$	230	63	$	66,825	$	62,045	$	347	63
GGU death benefit	$	990	$	939	$	104	63	$	958	$	907	$	93	63
GMIB	$	432	$	406	$	56	66	$	425	$	399	$	72	66
GMWB:
GMWB	$	3,980	$	3,962	$	15	66	$	3,898	$	3,880	$	34	66
GMWB for life	30,330		30,199		140		65	28,588		28,462		263		64
Total — GMWB	$	34,310	$	34,161	$	155	65	$	32,486	$	32,342	$	297	64
GMAB	$	3,936	$	3,924	$	2	57	$	3,773	$	3,762	$	5	57

(1)Individual variable annuity contracts may have more than one guarantee and therefore may be included in more than one benefit type.  Variable annuity contracts for which the death benefit equals the account value are not shown in this table.

(2)Represents the current guaranteed benefit amount in excess of the current contract value.  GMIB, GMWB and GMAB benefits are subject to waiting periods and payment periods specified in the contract.

13

RIVERSOURCE LIFE INSURANCE COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)

Changes in additional liabilities for variable annuity and insurance guarantees were as follows:

	GMDB & GGU			GMIB			GMWB			GMAB			UL
	(in millions)
Balance at January 1, 2012	$	5		$	9		$	1,377		$	237		$	111
Incurred claims	—			(2		)	(624		)	(119		)	17
Paid claims	(2		)	—			—			—			(4		)
Balance at March 31, 2012	$	3		$	7		$	753		$	118		$	124
Balance at January 1, 2013	$	4		$	9		$	799		$	103		$	155
Incurred claims	1			—			(480		)	(80		)	17
Paid claims	(1		)	—			—			—			(3		)
Balance at March 31, 2013	$	4		$	9		$	319		$	23		$	169

The liabilities for guaranteed benefits are supported by general account assets.

The following table summarizes the distribution of separate account balances by asset type for variable annuity contracts providing guaranteed benefits:

	March 31,		December 31,
	2013		2012
	(in millions)
Mutual funds:
Equity	$	33,375	$	32,054
Bond	26,477		26,165
Other	4,209		3,991
Total mutual funds	$	64,061	$	62,210

9.Short-term Borrowings

The Company enters into repurchase agreements in exchange for cash which it accounts for as secured borrowings.  The Company has pledged Available-for-Sale securities consisting of agency residential mortgage backed securities and commercial mortgage backed securities to collateralize its obligation under the repurchase agreements. The fair value of the securities pledged is recorded in investments and was $208 million and $518 million at March 31, 2013 and December 31, 2012, respectively. The amount of the Company’s liability including accrued interest as of March 31, 2013 and December 31, 2012 was $200 million and $501 million, respectively.  The weighted average annualized interest rate on the repurchase agreements held as of both March 31, 2013 and December 31, 2012 was 0.4%.

RiverSource Life Insurance Company is a member of the Federal Home Loan Bank (“FHLB”) of Des Moines which provides access to collateralized borrowings. The Company has pledged Available-for-Sale securities consisting of commercial mortgage backed securities to collateralize its obligation under these borrowings. The fair value of the securities pledged is recorded in investments and was $389 million at March 31, 2013. The amount of the Company’s liability including accrued interest as of March 31, 2013 was $300 million.  The weighted average annualized interest rate on the FHLB advances held as of March 31, 2013 was 0.3%.

10.Fair Values of Assets and Liabilities

GAAP defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date; that is, an exit price.  The exit price assumes the asset or liability is not exchanged subject to a forced liquidation or distressed sale.

Valuation Hierarchy

The Company categorizes its fair value measurements according to a three-level hierarchy.  The hierarchy prioritizes the inputs used by the Company’s valuation techniques.  A level is assigned to each fair value measurement based on the lowest level input that is significant to the fair value measurement in its entirety.  The three levels of the fair value hierarchy are defined as follows:

Level 1Unadjusted quoted prices for identical assets or liabilities in active markets that are accessible at the measurement date.

Level 2Prices or valuations based on observable inputs other than quoted prices in active markets for identical assets and liabilities.

Level 3Prices or valuations that require inputs that are both significant to the fair value measurement and unobservable.

14

RIVERSOURCE LIFE INSURANCE COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)

The following tables present the balances of assets and liabilities measured at fair value on a recurring basis:

	March 31, 2013
	Level 1		Level 2		Level 3		Total
	(in millions)
Assets
Available-for-Sale securities:
Fixed maturities:
Corporate debt securities	$	—	$	15,067	$	1,653	$	16,720
Residential mortgage backed securities	—		3,569		8		3,577
Commercial mortgage backed securities	—		2,657		168		2,825
State and municipal obligations	—		1,117		—		1,117
Asset backed securities	—		707		160		867
Foreign government bonds and obligations	—		214		—		214
U.S. government and agencies obligations	10		38		—		48
Total Available-for-Sale securities: Fixed maturities	10		23,369		1,989		25,368
Common stocks	2		2		—		4
Cash equivalents	—		137		—		137
Other assets:
Interest rate derivative contracts	—		1,937		—		1,937
Equity derivative contracts	339		867		—		1,206
Foreign currency derivative contracts	—		7		—		7
Total other assets	339		2,811		—		3,150
Separate account assets	—		72,532		—		72,532
Total assets at fair value	$	351	$	98,851	$	1,989	$	101,191
Liabilities
Future policy benefits:
EIA embedded derivatives	$	—	$	3	$	—	$	3
IUL embedded derivatives	—		61		—		61
GMWB and GMAB embedded derivatives	—		—		266		266
Total future policy benefits	—		64		266		330		(1)
Other liabilities:
Interest rate derivative contracts	—		1,421		—		1,421
Equity derivative contracts	141		1,768		—		1,909
Foreign currency derivative contracts	—		1		—		1
Total other liabilities	141		3,190		—		3,331
Total liabilities at fair value	$	141	$	3,254	$	266	$	3,661

(1)The Company’s adjustment for nonperformance risk resulted in a $295 million cumulative decrease to the embedded derivative liability.

15

RIVERSOURCE LIFE INSURANCE COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)

	December 31, 2012
	Level 1		Level 2		Level 3		Total
	(in millions)
Assets
Available-for-Sale securities:
Fixed maturities:
Corporate debt securities	$	—	$	15,387	$	1,654	$	17,041
Residential mortgage backed securities	—		3,598		23		3,621
Commercial mortgage backed securities	—		2,834		170		3,004
State and municipal obligations	—		1,122		—		1,122
Asset backed securities	—		715		156		871
Foreign government bonds and obligations	—		224		—		224
U.S. government and agencies obligations	10		39		—		49
Total Available-for-Sale securities: Fixed maturities	10		23,919		2,003		25,932
Common stocks	2		2		—		4
Cash equivalents	—		264		—		264
Other assets:
Interest rate derivative contracts	—		2,191		—		2,191
Equity derivative contracts	285		936		—		1,221
Foreign currency derivative contracts	—		6		—		6
Total other assets	285		3,133		—		3,418
Separate account assets	—		69,395		—		69,395
Total assets at fair value	$	297	$	96,713	$	2,003	$	99,013
Liabilities
Future policy benefits:
EIA embedded derivatives	$	—	$	2	$	—	$	2
IUL embedded derivatives	—		45		—		45
GMWB and GMAB embedded derivatives	—		—		833		833
Total future policy benefits	—		47		833		880		(1)
Other liabilities:
Interest rate derivative contracts	—		1,486		—		1,486
Equity derivative contracts	258		1,535		—		1,793
Total other liabilities	258		3,021		—		3,279
Total liabilities at fair value	$	258	$	3,068	$	833	$	4,159

(1)The Company’s adjustment for nonperformance risk resulted in a $389 million cumulative decrease to the embedded derivative liability.

16

RIVERSOURCE LIFE INSURANCE COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)

The following tables provide a summary of changes in Level 3 assets and liabilities measured at fair value on a recurring basis:

	Available-for-Sale Securities: Fixed Maturities															Future Policy
	Corporate Debt Securities			Residential Mortgage Backed Securities			Commercial Mortgage Backed Securities			Asset Backed Securities			Total			Benefits:GMWB and GMAB Embedded Derivatives
	(in millions)
Balance, January 1, 2013	$	1,654		$	23		$	170		$	156		$	2,003		$	(833	)
Total gains (losses) included in:
Net income	—			—			—			1			1		(1)	618		(2)
Other comprehensive income	—			—			(2		)	4			2			—
Purchases	54			—			—			—			54			—
Sales	—			—			—			—			—			—
Issues	—			—			—			—			—			(50		)
Settlements	(55		)	—			—			(1		)	(56		)	(1		)
Transfers into Level 3	—			—			—			—			—			—
Transfers out of Level 3	—			(15		)	—			—			(15		)	—
Balance, March 31, 2013	$	1,653		$	8		$	168		$	160		$	1,989		$	(266	)
Changes in unrealized gains (losses) relating to assets and liabilities held at March 31, 2013 included in:
Net investment income	$	—		$	—		$	—		$	1		$	1		$	—
Benefits, claims, losses and settlement expenses	—			—			—			—			—			609

(1)Represents a $1 million gain included in net investment income in the Consolidated Statements of Income.

(2)Included in benefits, claims, losses and settlement expenses in the Consolidated Statements of Income.

	Available-for-Sale Securities: Fixed Maturities																	Future Policy Benefits:
	Corporate Debt Securities			Residential Mortgage Backed Securities			Commercial Mortgage Backed Securities		Asset Backed Securities		Other Structured Investments		Total			Common Stock		GMWB and GMAB Embedded Derivatives
	(in millions)
Balance, January 1, 2012	$	1,342		$	58		$	16	$	133	$	14	$	1,563		$	—	$	(1,585	)
Total gains (losses) included in:
Net income	—			(2		)	—		—		—		(2		)(1)	—		784		(2)
Other comprehensive income	4			5			—		—		1		10			—		—
Purchases	98			24			—		—		—		122			1		—
Sales	—			—			—		—		—		—			—		—
Issues	—			—			—		—		—		—			—		(39		)
Settlements	(51		)	(3		)	—		—		—		(54		)	—		—
Transfers into Level 3	—			—			—		7		—		7			—		—
Transfers out of Level 3	—			—			—		—		—		—			—		—
Balance, March 31, 2012	$	1,393		$	82		$	16	$	140	$	15	$	1,646		$	1	$	(840	)
Changes in unrealized gains (losses) relating to assets and liabilities held at March 31, 2012 included in:
Net realized investment gains (losses)	$	—		$	2		$	—	$	—	$	—	$	2		$	—	$	—
Benefits, claims, losses and settlement expenses	—			—			—		—		—		—			—		769

(1)    Represents a $2 million loss included in net realized investment gains in the Consolidated Statements of Income.

(2)    Included in benefits, claims, losses and settlement expenses in the Consolidated Statements of Income.

17

RIVERSOURCE LIFE INSURANCE COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)

The impact to pretax income of the Company’s adjustment for nonperformance risk on the fair value of its GMWB and GMAB embedded derivatives was $(65) million and $(115) million, net of DAC and DSIC amortization, for the three months ended March 31, 2013 and 2012, respectively.

Securities transferred from Level 3 primarily represent securities with fair values that are now obtained from a third party pricing service with observable inputs.  Securities transferred to Level 3 represent securities with fair values that are now based on a single non-binding broker quote.  The Company recognizes transfers between levels of the fair value hierarchy as of the beginning of the quarter in which each transfer occurred.  For assets and liabilities held at the end of the reporting periods that are measured at fair value on a recurring basis, there were no transfers between Level 1 and Level 2.

The following tables provide a summary of the significant unobservable inputs used in the fair value measurements developed by the Company or reasonably available to the Company of Level 3 assets and liabilities:

	March 31, 2013
	Fair Value		Valuation Technique	Unobservable Input	Range (Weighted Average)
	(in millions)
Corporate debt securities (private placements)	$	1,625	Discounted cash flow	Yield/spread to U.S. Treasuries	1.1% – 6.0% (2.0%)
GMWB and GMAB embedded derivatives	$	266	Discounted cash flow	Utilization of guaranteed withdrawals(1)	0.0% – 56.4%
				Surrender rate	0.0% – 56.3%
				Market volatility(2)	5.2% – 20.2%
				Nonperformance risk(3)	93 bps

	December 31, 2012
	Fair Value		Valuation Technique	Unobservable Input	Range (Weighted Average)
	(in millions)
Corporate debt securities (private placements)	$	1,624	Discounted cash flow	Yield/spread to U.S. Treasuries	1.1% – 8.5% (2.2%)
GMWB and GMAB embedded derivatives	$	833	Discounted cash flow	Utilization of guaranteed withdrawals(1)	0.0% – 56.4%
				Surrender rate	0.0% – 56.3%
				Market volatility(2)	5.6% – 21.2%
				Nonperformance risk(3)	97 bps

(1)The utilization of the guaranteed withdrawals represents the percentage of policyholders that will begin withdrawing in any given year.

(2)Market volatility is implied volatility of fund of funds.

(3)The nonperformance risk is the spread added to the observable interest rates used in the valuation of the embedded derivative.

Level 3 measurements not included in the table above are obtained from non-binding broker quotes where unobservable inputs are not reasonably available to the Company.

Sensitivity of Fair Value Measurements to Changes in Unobservable Inputs

Significant increases (decreases) in the yield/spread to U.S. Treasuries used in the fair value measurement of Level 3 corporate debt securities in isolation would result in a significantly lower (higher) fair value measurement.

Significant increases (decreases) in utilization and volatility used in the fair value measurement of the GMWB and GMAB embedded derivatives in isolation would result in a significantly higher (lower) fair value measurement. Significant increases (decreases) in surrender rate and nonperformance risk used in the fair value measurement of the GMWB and GMAB embedded derivatives in isolation would result in a significantly lower (higher) fair value measurement. Utilization of guaranteed withdrawals and surrender rates vary with the type of rider, the duration of the policy, the age of the contractholder, the distribution system and whether the value of the guaranteed benefit exceeds the contract accumulation value.

18

RIVERSOURCE LIFE INSURANCE COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)

Determination of Fair Value

The Company uses valuation techniques consistent with the market and income approaches to measure the fair value of its assets and liabilities.  The Company’s market approach uses prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities.  The Company’s income approach uses valuation techniques to convert future projected cash flows to a single discounted present value amount.  When applying either approach, the Company maximizes the use of observable inputs and minimizes the use of unobservable inputs.

The following is a description of the valuation techniques used to measure fair value and the general classification of these instruments pursuant to the fair value hierarchy.

Assets

Cash Equivalents

Cash equivalents include highly liquid investments with original maturities of 90 days or less. Cash equivalents are classified as Level 2 and measured at amortized cost, which is a reasonable estimate of fair value because of the short time between the purchase of the instrument and its expected realization.

Available-for-Sale Securities

When available, the fair value of securities is based on quoted prices in active markets.  If quoted prices are not available, fair values are obtained from third party pricing services, non-binding broker quotes, or other model-based valuation techniques.  Level 1 securities include U.S. Treasuries.  Level 2 securities include corporate bonds, residential mortgage backed securities, commercial mortgage backed securities, municipal bonds, asset backed securities and U.S. agency and foreign government securities.  The fair value of these Level 2 securities is based on a market approach with prices obtained from third party pricing services.  Observable inputs used to value these securities can include, but are not limited to, reported trades, benchmark yields, issuer spreads and non-binding broker quotes.  Level 3 securities primarily include certain corporate bonds, non-agency residential mortgage backed securities, commercial mortgage backed securities and asset backed securities.  The fair value of corporate bonds, non-agency residential mortgage backed securities, commercial mortgage backed securities and certain asset backed securities classified as Level 3 is typically based on a single non-binding broker quote. The underlying inputs used for some of the non-binding broker quotes are not readily available to the Company.

In consideration of the above, management is responsible for the fair values recorded on the financial statements. Prices received from third party pricing services are subjected to exception reporting that identifies investments with significant daily price movements as well as no movements.  The Company reviews the exception reporting and resolves the exceptions through reaffirmation of the price or recording an appropriate fair value estimate.  The Company also performs subsequent transaction testing.  The Company performs annual due diligence of third party pricing services.  The Company’s due diligence procedures include assessing the vendor’s valuation qualifications, control environment, analysis of asset-class specific valuation methodologies, and understanding of sources of market observable assumptions and unobservable assumptions, if any, employed in the valuation methodology.  The Company also considers the results of its exception reporting controls and any resulting price challenges that arise.

Separate Account Assets

The fair value of assets held by separate accounts is determined by the net asset value (“NAV”) of the funds in which those separate accounts are invested.  The NAV represents the exit price for the separate account.  Separate account assets are classified as Level 2 as they are traded in principal-to-principal markets with little publicly released pricing information.

Other Assets

Derivatives that are measured using quoted prices in active markets, such as derivatives that are exchange-traded, are classified as Level 1 measurements.  The fair value of derivatives that are traded in less active over-the-counter  (“OTC”) markets are generally measured using pricing models with market observable inputs such as interest rates and equity index levels.  These measurements are classified as Level 2 within the fair value hierarchy and include swaps and the majority of options.  The counterparties’ nonperformance risk associated with uncollateralized derivative assets was immaterial at March 31, 2013 and December 31, 2012.  See Note 11 and Note 12 for further information on the credit risk of derivative instruments and related collateral.

19

RIVERSOURCE LIFE INSURANCE COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)

Liabilities

Future Policy Benefits

The Company values the embedded derivative liability attributable to the provisions of certain variable annuity riders using internal valuation models.  These models calculate fair value by discounting expected cash flows from benefits plus margins for profit, risk and expenses less embedded derivative fees.  The projected cash flows used by these models include observable capital market assumptions and incorporate significant unobservable inputs related to contractholder behavior assumptions, implied volatility and margins for risk, profit and expenses that the Company believes an exit market participant would expect.  The fair value of these embedded derivatives also reflects a current estimate of the Company’s nonperformance risk specific to these liabilities.  Given the significant unobservable inputs to this valuation, these measurements are classified as Level 3.  The embedded derivative liability attributable to these provisions is recorded in future policy benefits.

The Company’s Corporate Actuarial Department calculates the fair value of the GMWB and GMAB embedded derivatives on a monthly basis. During this process, control checks are performed to validate the completeness of the data. Actuarial management approves various components of the valuation along with the final results. The change in the fair value of the embedded derivatives is reviewed monthly with senior management. The Level 3 inputs into the valuation are consistent with the pricing assumptions and updated as experience develops.  Significant unobservable inputs that reflect policyholder behavior are reviewed quarterly along with other valuation assumptions.

The Company uses various Black-Scholes calculations to determine the fair value of the embedded derivative liability associated with the provisions of its EIA and IUL products.  The inputs to these calculations are primarily market observable and include interest rates, volatilities and equity index levels.  As a result, these measurements are classified as Level 2.

Other Liabilities

Derivatives that are measured using quoted prices in active markets, such as derivatives that are exchange-traded, are classified as Level 1 measurements.  The fair value of derivatives that are traded in less active OTC markets are generally measured using pricing models with market observable inputs such as interest rates and equity index levels.  These measurements are classified as Level 2 within the fair value hierarchy and include swaps and the majority of options. The Company’s nonperformance risk associated with uncollateralized derivative liabilities was immaterial at March 31, 2013 and December 31, 2012.  See Note 11 and Note 12 for further information on the credit risk of derivative instruments and related collateral.

During the reporting periods, there were no material assets or liabilities measured at fair value on a nonrecurring basis.

The following tables provide the carrying value and the estimated fair value of financial instruments that are not reported at fair value.  All other financial instruments that are reported at fair value have been included above in the table with balances of assets and liabilities measured at fair value on a recurring basis.

	March 31, 2013
	Carrying		Fair Value
	Value		Level 1		Level 2		Level 3		Total
	(in millions)
Financial Assets
Mortgage loans, net	$	3,365	$	—	$	—	$	3,553	$	3,553
Policy loans	752		—		—		686		686
Other investments	314		—		284		37		321
Restricted cash	75		75		—		—		75
Financial Liabilities
Future policy benefits	$	14,548	$	—	$	—	$	15,578	$	15,578
Separate account liabilities	375		—		375		—		375
Line of credit with Ameriprise Financial	150		—		—		150		150
Short-term borrowings	500		—		500		—		500
Other liabilities	123		—		—		121		121

20

RIVERSOURCE LIFE INSURANCE COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)

	December 31, 2012
	Carrying		Fair Value
	Value		Level 1		Level 2		Level 3		Total
	(in millions)
Financial Assets
Mortgage loans, net	$	3,389	$	—	$	—	$	3,568	$	3,568
Policy loans	752		—		—		725		725
Other investments	309		—		292		24		316
Restricted cash	86		86		—		—		86
Financial Liabilities
Future policy benefits	$	14,701	$	—	$	—	$	15,982	$	15,982
Separate account liabilities	360		—		360		—		360
Line of credit with Ameriprise Financial	150		—		—		150		150
Short-term borrowings	501		—		500		—		500
Other liabilities	144		—		—		142		142

Mortgage Loans, Net

The fair value of commercial mortgage loans, except those with significant credit deterioration, is determined by discounting contractual cash flows using discount rates that reflect current pricing for loans with similar remaining maturities and characteristics including LTV ratio, occupancy rate, refinance risk, debt-service coverage, location, and property condition.  For commercial mortgage loans with significant credit deterioration, fair value is determined using the same adjustments as above with an additional adjustment for the Company’s estimate of the amount recoverable on the loan.

The fair value of residential mortgage loans is determined by discounting estimated cash flows and incorporating adjustments for prepayment, administration expenses, loss severity and credit loss estimates, with discount rates based on the Company’s estimate of current market conditions.

Given the significant unobservable inputs to the valuation of mortgage loans, these measurements are classified as Level 3.

Policy Loans

The fair value of policy loans is determined using discounted cash flows and are classified as Level 3 as the discount rate used may be adjusted for the underlying performance of individual policies.

Other Investments

Other investments primarily consist of syndicated loans and an investment in FHLB.  The fair value of syndicated loans is obtained from a third party service or non-binding broker quotes.  Syndicated loans that are priced by multiple non-binding broker quotes are classified as Level 2 and syndicated loans priced using a single non-binding broker quote are classified as Level 3.  The fair value of the investment in FHLB is approximated by the carrying value and classified as Level 3 due to restrictions on transfer or lack of liquidity.

Restricted Cash

Restricted cash is generally set aside for specific business transactions and restrictions are specific to the Company and do not transfer to third party market participants; therefore, the carrying amount is a reasonable estimate of fair value. The fair value of restricted cash is classified as Level 1.

Future Policy Benefits

The fair value of fixed annuities, in deferral status, is determined by discounting cash flows using a risk neutral discount rate with adjustments for profit margin, expense margin, early policy surrender behavior, a provision for adverse deviation from estimated early policy surrender behavior and the Company’s nonperformance risk specific to these liabilities.  The fair value of other liabilities including non-life contingent fixed annuities in payout status, EIA host contracts and the fixed portion of a small number of variable annuity contracts classified as investment contracts is determined in a similar manner.  Given the use of significant unobservable inputs to these valuations, the measurements are classified as Level 3.

21

RIVERSOURCE LIFE INSURANCE COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)

Separate Account Liabilities

Certain separate account liabilities are classified as investment contracts and are carried at an amount equal to the related separate account assets.  The NAV of the related separate account assets represents the exit price for the separate account liabilities. Separate account liabilities are classified as Level 2 as they are traded in principal-to-principal markets with little publicly released pricing information. A nonperformance adjustment is not included as the related separate account assets act as collateral for these liabilities and minimize nonperformance risk.

Line of Credit with Ameriprise Financial

The fair value of the line of credit is determined by discounting cash flows with an adjustment for the Company’s nonperformance risk specific to this liability.  The fair value of the line of credit is classified as Level 3.

Short-term borrowings

The fair value of short-term borrowings is obtained from a third party pricing service. A nonperformance adjustment is not included as collateral requirements for these borrowings minimize the nonperformance risk.  The fair value of short-term borrowings is classified as Level 2.

Other Liabilities

Other liabilities consist of future funding commitments to affordable housing partnerships.  The fair value of these future funding commitments is determined by discounting cash flows and is classified as Level 3 as the discount rate is adjusted.

11.Offsetting Assets and Liabilities

Certain financial instruments and derivative instruments are eligible for offset in the Consolidated Balance Sheets under U.S. GAAP. The Company’s derivative instruments and repurchase agreements are subject to master netting arrangements and collateral arrangements and meet the U.S. GAAP guidance to qualify for offset. A master netting arrangement with a counterparty creates a right of offset for amounts due to and from that same counterparty that is enforceable in the event of a default or bankruptcy. The Company’s policy is to recognize amounts subject to master netting arrangements on a gross basis on the Consolidated Balance Sheets.

The following tables present the gross and net information about the Company’s assets subject to master netting arrangements:

	March 31, 2013
			Gross		Amounts
	Gross		Amounts		of Assets		Gross Amounts Not Offset
	Amounts of		Offset in the		Presented in		in the Consolidated Balance Sheets
	Recognized		Consolidated		the Consolidated		Financial			Cash			Securities			Net
	Assets		Balance Sheets		Balance Sheets		Instruments(1)			Collateral			Collateral			Amount
	(in millions)
Derivatives:
OTC	$	3,056	$	—	$	3,056	$	(2,630	)	$	(150	)	$	(241	)	$	35
Exchange-traded	94		—		94		—			—			—			94
Total derivatives	$	3,150	$	—	$	3,150	$	(2,630	)	$	(150	)	$	(241	)	$	129

	December 31, 2012
			Gross		Amounts
	Gross		Amounts		of Assets		Gross Amounts Not Offset
	Amounts of		Offset in the		Presented in		in the Consolidated Balance Sheets
	Recognized		Consolidated		the Consolidated		Financial			Cash			Securities			Net
	Assets		Balance Sheets		Balance Sheets		Instruments(1)			Collateral			Collateral			Amount
	(in millions)
Derivatives:
OTC	$	3,322	$	—	$	3,322	$	(2,676	)	$	(262	)	$	(355	)	$	29
Exchange-traded	96		—		96		—			—			—			96
Total derivatives	$	3,418	$	—	$	3,418	$	(2,676	)	$	(262	)	$	(355	)	$	125

(1)Represents the amount of assets that could be offset by liabilities with the same counterparty under master netting or similar arrangements that management elects not to offset on the Consolidated Balance Sheets.

22

RIVERSOURCE LIFE INSURANCE COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)

The following tables present the gross and net information about the Company’s liabilities subject to master netting arrangements:

	March 31, 2013
			Gross		Amounts
	Gross		Amounts		of Liabilities		Gross Amounts Not Offset
	Amounts of		Offset in the		Presented in		in the Consolidated Balance Sheets
	Recognized		Consolidated		the Consolidated		Financial			Cash			Securities			Net
	Liabilities		Balance Sheets		Balance Sheets		Instruments(1)			Collateral			Collateral			Amount
	(in millions)
OTC derivatives	$	3,331	$	—	$	3,331	$	(2,630	)	$	(67	)	$	(634	)	$	—
Repurchase agreements	200		—		200		—			—			(200		)	—
Total	$	3,531	$	—	$	3,531	$	(2,630	)	$	(67	)	$	(834	)	$	—

	December 31, 2012
			Gross		Amounts
	Gross		Amounts		of Liabilities		Gross Amounts Not Offset
	Amounts of		Offset in the		Presented in		in the Consolidated Balance Sheets
	Recognized		Consolidated		the Consolidated		Financial			Cash			Securities			Net
	Liabilities		Balance Sheets		Balance Sheets		Instruments(1)			Collateral			Collateral			Amount
	(in millions)
OTC derivatives	$	3,279	$	—	$	3,279	$	(2,676	)	$	(67	)	$	(532	)	$	4
Repurchase agreements	501		—		501		—			—			(501		)	—
Total	$	3,780	$	—	$	3,780	$	(2,676	)	$	(67	)	$	(1,033	)	$	4

(1)Represents the amount of liabilities that could be offset by assets with the same counterparty under master netting or similar arrangements that management elects not to offset on the Consolidated Balance Sheets.

In the tables above, the amounts of assets or liabilities presented in the Consolidated Balance Sheets are offset first by financial instruments that have the right of offset under master netting or similar arrangements, then any remaining amount is reduced by the amount of cash and securities collateral.  The actual amounts of collateral may be greater than amounts presented in the tables.

The Company’s freestanding derivative instruments are reflected in other assets and other liabilities.  Repurchase agreements are reflected in short-term borrowings.  See Note 12 for additional disclosures related to the Company’s derivative instruments and Note 9 for additional disclosures related to the Company’s repurchase agreements.

12.Derivatives and Hedging Activities

Derivative instruments enable the Company to manage its exposure to various market risks.  The value of such instruments is derived from an underlying variable or multiple variables, including equity and interest rate indices or prices.  The Company primarily enters into derivative agreements for risk management purposes related to the Company’s products and operations.

The Company’s freestanding derivatives are recorded at fair value and are reflected in other assets or other liabilities. The Company’s freestanding derivative instruments are all subject to master netting arrangements. The Company’s policy on the recognition of derivatives on the Consolidated Balance Sheets is to not offset fair value amounts recognized for derivatives and collateral arrangements executed with the same counterparty under the same master netting arrangement. See Note 11 for additional information regarding the estimated fair value of the Company’s freestanding derivatives after considering the effect of master netting arrangements and collateral.

In April 2012, the Financial Stability Oversight Council approved the final rule and interpretive guidance that provides the framework it will follow to determine if a nonbank financial company is a Systemically Important Financial Institution. The framework includes a three-stage process to help narrow down the pool of nonbank financial companies for review and possible designation. Stage 1 criteria include having at least $50 billion in assets and meeting one of five additional quantitative measures. One of the five thresholds is $3.5 billion of derivative liabilities after considering the effects of master netting arrangements and cash collateral held with the same counterparty. The following table presents the Company’s derivative liabilities as defined by the rule:

	March 31, 2013		December 31, 2012
	(in millions)
Fair value of OTC derivative liabilities after application of master netting agreements and cash collateral	$	634	$	536
Fair value of embedded derivative liabilities	330		880
Fair value of derivative liabilities after application of master netting agreements and cash collateral	$	964	$	1,416

23

RIVERSOURCE LIFE INSURANCE COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)

The Company currently uses derivatives as economic hedges and accounting hedges.  The following table presents the balance sheet location and the gross fair value of derivative instruments, including embedded derivatives:

		Asset					Liability
Derivatives not designated as hedging instruments	Balance Sheet Location	March 31, 2013		December 31, 2012		Balance Sheet Location	March 31, 2013		December 31, 2012
		(in millions)					(in millions)
GMWB and GMAB
Interest rate contracts	Other assets	$	1,937	$	2,191	Other liabilities	$	1,421	$	1,486
Equity contracts	Other assets	1,192		1,215		Other liabilities	1,904		1,792
Foreign currency contracts	Other assets	7		6		Other liabilities	1		—
Embedded derivatives(1)	Not applicable	—		—		Future policy benefits	266		833
Total GMWB and GMAB		3,136		3,412			3,592		4,111
Other derivatives:
Equity
EIA embedded derivatives	Not applicable	—		—		Future policy benefits	3		2
IUL	Other assets	14		6		Other liabilities	5		1
IUL embedded derivatives	Not applicable	—		—		Future policy benefits	61		45
Total other		14		6			69		48
Total derivatives		$	3,150	$	3,418		$	3,661	$	4,159

(1)The fair values of GMWB and GMAB embedded derivatives fluctuate based on changes in equity, interest rate and credit markets.

See Note 10 for additional information regarding the Company’s fair value measurement of derivative instruments.

The following table presents a summary of the impact of derivatives not designated as hedging instruments on the Consolidated Statements of Income for the three months ended March 31:

		Amount of Gain (Loss) on Derivatives
Derivatives not designated	Location of Gain (Loss) on	Recognized in Income
as hedging instruments	Derivatives Recognized in Income	2013			2012
		(in millions)
GMWB and GMAB
Interest rate contracts	Benefits, claims, losses and settlement expenses	$	(132	)	$	(225	)
Equity contracts	Benefits, claims, losses and settlement expenses	(492		)	(695		)
Credit contracts	Benefits, claims, losses and settlement expenses	—			(3		)
Foreign currency contracts	Benefits, claims, losses and settlement expenses	5			4
Embedded derivatives(1)	Benefits, claims, losses and settlement expenses	567			745
Total GMWB and GMAB		(52		)	(174		)
Other derivatives:
Equity
EIA	Interest credited to fixed accounts	1			1
EIA embedded derivatives	Interest credited to fixed accounts	(1		)	—
IUL	Interest credited to fixed accounts	4			—
IUL embedded derivatives	Interest credited to fixed accounts	3			—
Total other		7			1
Total derivatives		$	(45	)	$	(173	)

(1)The fair values of GMWB and GMAB embedded derivatives fluctuate based on changes in equity, interest rate and credit markets.

The Company holds derivative instruments that either do not qualify or are not designated for hedge accounting treatment.  These derivative instruments are used as economic hedges of equity, interest rate and credit risk related to various products and transactions of the Company.

Certain annuity contracts contain GMWB or GMAB provisions, which guarantee the right to make limited partial withdrawals each contract year regardless of the volatility inherent in the underlying investments or guarantee a minimum accumulation value of consideration received at the beginning of the contract period, after a specified holding period, respectively.  The Company economically hedges the exposure related to non-life contingent GMWB and GMAB provisions

24

RIVERSOURCE LIFE INSURANCE COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)

primarily using various futures, options, interest rate swaptions, interest rate swaps, total return swaps, variance swaps and credit default swaps.  At March 31, 2013 and December 31, 2012, the gross notional amount of derivative contracts for the Company’s GMWB and GMAB provisions was $146.1 billion and $142.1 billion, respectively.

The deferred premium associated with certain of the above options is paid or received semi-annually over the life of the option contract.  The following is a summary of the payments the Company is scheduled to make and receive for these options:

	Premiums Payable		Premiums Receivable
	(in millions)
2013(1)	$	287	$	47
2014	344		54
2015	317		53
2016	287		46
2017	237		40
2018-2027	780		104

(1)   2013 amounts represent the amounts payable and receivable for the period from April 1, 2013 to December 31, 2013.

Actual timing and payment amounts may differ due to future contract settlements, modifications or exercises of options prior to the full premium being paid or received.

EIA and IUL products have returns tied to the performance of equity markets.  As a result of fluctuations in equity markets, the obligation incurred by the Company related to EIA and IUL products will positively or negatively impact earnings over the life of these products.  As a means of economically hedging its obligations under the provisions of these products, the Company enters into index options and futures contracts.  The gross notional amount of EIA derivative contracts was $12 million and $10 million at March 31, 2013 and December 31, 2012, respectively. The gross notional amount of IUL derivative contracts was $255 million and $200 million at March 31, 2013 and December 31, 2012, respectively.

Embedded Derivatives

Certain annuities contain GMAB and non-life contingent GMWB provisions, which are considered embedded derivatives.  In addition, the equity component of the EIA and IUL product obligations are also considered embedded derivatives.  These embedded derivatives are bifurcated from their host contracts and reported on the Consolidated Balance Sheets at fair value with changes in fair value reported in earnings.  As discussed above, the Company uses derivatives to mitigate the financial statement impact of these embedded derivatives.

Cash Flow Hedges

The Company has amounts classified in AOCI related to gains and losses associated with the effective portion of previously designated cash flow hedges.  The Company reclassifies these amounts into income as the forecasted transactions impact earnings.  During the three months ended March 31, 2013, the Company held no derivatives that were designated as cash flow hedges.

At March 31, 2013, the Company expects to reclassify $6 million of deferred loss on derivative instruments from AOCI to earnings during the next 12 months that will be recorded in net investment income.  These were originally losses on derivative instruments related to interest rate swaptions.  During the three months ended March 31, 2013 and 2012, no hedge relationships were discontinued due to forecasted transactions no longer being expected to occur according to the original hedge strategy.  For the three months ended March 31, 2013 and 2012, amounts recognized in earnings on derivative transactions that were ineffective were not material.

The following table presents a rollforward of unrealized derivative losses related to cash flow hedges included in accumulated other comprehensive income:

	2013			2012
	(in millions)
Net unrealized derivative losses at January 1	$	(21	)	$	(26	)
Reclassification of realized losses(1)	2			2
Income tax benefit	(1		)	(1		)
Net unrealized derivative losses at March 31	$	(20	)	$	(25	)

(1)Loss reclassified from AOCI to net investment income on the Consolidated Statements of Income.

25

RIVERSOURCE LIFE INSURANCE COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)

Currently, the longest period of time over which the Company is hedging exposure to the variability in future cash flows is six years and relates to interest credited on forecasted fixed premium product sales.

Credit Risk

Credit risk associated with the Company’s derivatives is the risk that a derivative counterparty will not perform in accordance with the terms of the applicable derivative contract.  To mitigate such risk, the Company has established guidelines and oversight of credit risk through a comprehensive enterprise risk management program that includes members of senior management.  Key components of this program are to require preapproval of counterparties and the use of master netting arrangements and collateral arrangements whenever practical.  See Note 11 for additional information on the Company’s credit exposure related to derivative assets.

Certain of the Company’s derivative contracts contain provisions that adjust the level of collateral the Company is required to post based on the Company’s financial strength rating (or based on the debt rating of the Company’s parent, Ameriprise Financial).  Additionally, certain of the Company’s derivative contracts contain provisions that allow the counterparty to terminate the contract if the Company does not maintain a specific financial strength rating or Ameriprise Financial’s debt does not maintain a specific credit rating (generally an investment grade rating).  If these termination provisions were to be triggered, the Company’s counterparty could require immediate settlement of any net liability position.  At March 31, 2013 and December 31, 2012, the aggregate fair value of derivative contracts in a net liability position containing such credit contingent provisions was $448 million and $364 million, respectively.  The aggregate fair value of assets posted as collateral for such instruments as of March 31, 2013 and December 31, 2012 was $448 million and $360 million, respectively.  If the credit contingent provisions of derivative contracts in a net liability position at March 31, 2013 and December 31, 2012 were triggered, the aggregate fair value of additional assets that would be required to be posted as collateral or needed to settle the instruments immediately would have been nil and $4 million, respectively.

13.  Shareholder’s Equity

The following table provides information related to amounts reclassified from AOCI for the three months ended March 31, 2013:

AOCI Reclassification	Location of Gain (Loss) Recognized in Income	AmountReclassifiedfrom AOCI
		(in millions)
Net unrealized losses on Available-for-Sale securities	Net investment income	$	1
Tax benefit	Income tax provision	(1		)
Net of tax		$	—
Losses on cash flow hedges:
Swaptions	Net investment income	$	2
Tax benefit	Income tax provision	(1		)
Net of tax		$	1

The Company made adjustments to AOCI for the impact to DAC, DSIC, benefit reserves and reinsurance recoverable on net unrealized securities gains of $64 million, net of tax. See Note 4 for additional information related to the impact of DAC, DSIC, benefit reserves and reinsurance recoverable on net unrealized securities losses included in AOCI. See Note 12 for additional information regarding the Company’s cash flow hedges.

14.Income Taxes

The Company’s effective tax rates were 18% and 10% for the three months ended March 31, 2013 and 2012, respectively.  The effective tax rates are lower than the statutory rate as a result of tax preferred items including the dividends received deduction, foreign tax credits and low income housing credits in comparison to the levels of pretax income.  The increase in the effective rate for the three months ended March 31, 2013 compared to the prior year period is the result of higher pretax income and lower dividends received deduction.

The Company is required to establish a valuation allowance for any portion of the deferred tax assets that management believes will not be realized.  Included in deferred tax assets is a significant deferred tax asset relating to capital losses that have been recognized for financial statement purposes but not yet for tax return purposes as well as future deductible capital losses realized for tax return purposes.  Under current U.S. federal income tax law, capital losses generally must be used against capital gain income within five years of the year in which the capital losses are recognized for tax purposes.

26

RIVERSOURCE LIFE INSURANCE COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)

Significant judgment is required in determining if a valuation allowance should be established, and the amount of such allowance if required.  Factors used in making this determination include estimates relating to the performance of the business including the ability to generate capital gains.  Consideration is given to, among other things in making this determination, (i) future taxable income exclusive of reversing temporary differences and carryforwards, (ii) future reversals of existing taxable temporary differences, (iii) taxable income in prior carryback years, and (iv) tax planning strategies.  Based on analysis of the Company’s tax position, management believes it is more likely than not that the results of future operations and implementation of tax planning strategies will not allow the Company to realize all of certain state net operating losses and therefore a valuation allowance of $5 million was established as of both March 31, 2013 and December 31, 2012.

As of both March 31, 2013 and December 31, 2012, the Company had $65 million of gross unrecognized tax benefits.  If recognized, approximately $8 million, net of federal tax benefits, of unrecognized tax benefits as of both March 31, 2013 and December 31, 2012 would affect the effective tax rate.

It is reasonably possible that the total amounts of unrecognized tax benefits will change in the next 12 months.   Based on the current audit position of the Company, it is estimated that the total amount of gross unrecognized tax benefits may decrease by $63 million in the next 12 months.

The Company recognizes interest and penalties related to unrecognized tax benefits as a component of the income tax provision.  The Company recognized a net increase of $2 million and a net reduction of $5 million in interest and penalties for the three months ended March 31, 2013 and 2012, respectively.  As of March 31, 2013 and December 31, 2012, the Company had a payable of $32 million and $30 million, respectively, related to accrued interest and penalties.

The Company or one or more of its subsidiaries files income tax returns as part of its inclusion in the consolidated federal income tax returns of Ameriprise Financial, in the U.S. federal jurisdiction and various state jurisdictions.  The Internal Revenue Service (“IRS”) had previously completed its field examination of the 1997 through 2007 tax returns in recent years.  However, for federal income tax purposes, these years except for 2007, continue to remain open as a consequence of certain unagreed-upon issues.  The IRS is in the process of completing the audit of the Company’s income tax returns for 2008 and 2009 and began auditing 2010 and 2011 in the fourth quarter of 2012.  The Company or certain of its subsidiaries’ state income tax returns are currently under examination by various jurisdictions for years ranging from 1997 through 2008 and remain open for the years after 2008.

15.Contingencies and Guarantees

Insurance companies have been the subject of increasing regulatory, legislative and judicial scrutiny.  Numerous state and federal regulatory agencies have commenced examinations and other inquiries of insurance companies regarding sales and marketing practices (including sales to older consumers and disclosure practices), claims handling, and unclaimed property and escheatment practices and procedures. With regard to an industry-wide investigation of unclaimed property and escheatment practices and procedures, the Company is responding to regulatory audits, market conduct examinations and other inquires (including inquiries from the States of Minnesota and New York and a multistate insurance department examination).  The Company has cooperated and will continue to cooperate with the applicable regulators regarding their inquiries.

The Company is involved in the normal course of business in a number of other legal and arbitration proceedings concerning matters arising in connection with the conduct of its business activities.  The Company believes that it is not a party to, nor are any of its properties the subject of, any pending legal, arbitration or regulatory investigation or proceeding that is likely to have a material adverse effect on its consolidated financial condition, results of operations or liquidity.  Notwithstanding the foregoing, it is possible that the outcome of any current or future legal, arbitration or regulatory proceeding could have a material impact on results of operations in any particular reporting period as the proceedings are resolved.

The Company is required by law to be a member of the guaranty fund association in every state where it is licensed to do business.  In the event of insolvency of one or more unaffiliated insurance companies, the Company could be adversely affected by the requirement to pay assessments to the guaranty fund associations.  Uncertainty and volatility in the U.S. economy and financial markets in recent years have weakened the financial condition of numerous insurers, including insurers currently in receiverships, increasing the risk of triggering guaranty fund assessments.

The Company projects its cost of future guaranty fund assessments based on estimates of insurance company insolvencies provided by the National Organization of Life and Health Insurance Guaranty Associations (“NOLHGA”) and the amount of its premiums written relative to the industry-wide premium in each state.  The Company accrues the estimated cost of future

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RIVERSOURCE LIFE INSURANCE COMPANY

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) (Continued)

guaranty fund assessments when it is considered probable that an assessment will be imposed, the event obligating the Company to pay the assessment has occurred  and the amount of the assessment can be reasonably estimated.

Executive Life Insurance Company of New York (“ELNY”) was placed into rehabilitation by a New York state court in 1991. On April 16, 2012, the court issued an order converting the rehabilitation into a liquidation proceeding under a plan submitted by the New York insurance regulator with support from NOLHGA and the industry.

During the second quarter of 2012, the Company established a liability for estimated guaranty fund assessments and a related premium tax asset, primarily associated with ELNY.  At both March 31, 2013 and December 31, 2012, the estimated liability was $26 million and the related premium tax asset was $19 million. The expected period over which the assessments will be made and the related tax credits recovered is not known.

Uncertain economic conditions, heightened and sustained volatility in the financial markets and significant financial reform legislation may increase the likelihood that clients and other persons or regulators may present or threaten legal claims or that regulators increase the scope or frequency of examinations of the Company or the insurance industry generally.

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ITEM 2.                MANAGEMENT’S NARRATIVE ANALYSIS

The following information should be read in conjunction with RiverSource Life Insurance Company’s Consolidated Financial Statements and Notes presented in Part I, Item 1.  RiverSource Life Insurance Company and its subsidiaries are referred to collectively in this Form 10-Q as the “Company”.  This narrative analysis may contain forward-looking statements that reflect the Company’s plans, estimates and beliefs.  Actual results could differ materially from those discussed in these forward-looking statements.  Factors that could cause or contribute to these differences include, but are not limited to, those discussed under “Forward-Looking Statements.”  The Company believes it is useful to read this narrative analysis in conjunction with its Annual Report on Form 10-K for the year ended December 31, 2012 filed with the Securities and Exchange Commission on February 26, 2013 (“2012 10-K”), as well as its current reports on Form 8-K and other publicly available information.

The Company follows U.S. generally accepted accounting principles (“GAAP”), and the following discussion is presented on a consolidated basis consistent with GAAP.  In addition, certain reclassifications of prior year amounts have been made to conform to the current presentation.

Management’s narrative analysis of the results of operations is presented in lieu of management’s discussion and analysis of financial condition and results of operations, pursuant to General Instructions H(2)(a) of Form 10-Q.

Overview

RiverSource Life Insurance Company is a stock life insurance company with one wholly owned stock life insurance company subsidiary, RiverSource Life Insurance Co. of New York (“RiverSource Life of NY”).  RiverSource Life Insurance Company is a wholly owned subsidiary of Ameriprise Financial, Inc. (“Ameriprise Financial”).

·RiverSource Life Insurance Company is domiciled in Minnesota and holds Certificates of Authority in American Samoa, the District of Columbia and all states except New York.  RiverSource Life Insurance Company issues insurance and annuity products.

·RiverSource Life of NY is domiciled and holds a Certificate of Authority in New York.  RiverSource Life of NY issues insurance and annuity products.

RiverSource Life Insurance Company also wholly owns RiverSource Tax Advantaged Investments, Inc. (“RTA”).  RTA is a stock company domiciled in Delaware and is a limited partner in affordable housing partnership investments.

Critical Accounting Policies

The accounting and reporting policies that the Company uses affect its Consolidated Financial Statements.  Certain of the Company’s accounting and reporting policies are critical to an understanding of the Company’s financial condition and results of operations and, in some cases, the application of these policies can be significantly affected by the estimates, judgments and assumptions made by management during the preparation of the Consolidated Financial Statements.  These accounting policies are discussed in detail in “Management’s Narrative Analysis — Critical Accounting Policies” in the Company’s 2012 10-K.

Recent Accounting Pronouncements

For information regarding recent accounting pronouncements and their expected impact on the Company’s future consolidated financial condition or results of operations, see Note 2 to the Consolidated Financial Statements.

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Consolidated Results of Operations for the Three Months Ended March 31, 2013 and 2012

The following table presents the Company’s consolidated results of operations (unaudited):

	Three Months Ended  March 31,
	2013			2012		Change
	(in millions)
Revenues
Premiums	$	108		$	112	$	(4	)	(4	)%
Net investment income	358			377		(19		)	(5	)
Policy and contract charges	416			395		21			5
Other revenue	88			77		11			14
Net realized investment gains (losses)	(1		)	3		(4		)	NM
Total revenues	969			964		5			1
Benefits and expenses
Benefits, claims, losses and settlement expenses	235			350		(115		)	(33	)
Interest credited to fixed accounts	198			206		(8		)	(4	)
Amortization of deferred acquisition costs	59			17		42			NM
Other insurance and operating expenses	183			201		(18		)	(9	)
Total benefits and expenses	675			774		(99		)	(13	)
Pretax income	294			190		104			55
Income tax provision	54			19		35			NM
Net income	$	240		$	171	$	69		40	%

NM  Not Meaningful

Overview

Net income increased $69 million or 40% compared to the prior year period.  Pretax income increased $104 million or 55% compared to the prior year period primarily reflecting the impact of market appreciation and the market impact on variable annuity guaranteed living benefits (net of hedges and the related deferred acquisition costs (“DAC”) and deferred sales inducement costs (“DSIC”) amortization), partially offset by the negative impact of the continued low interest rate environment. The market impact on variable annuity guaranteed living benefits (net of hedges and the related DAC and DSIC amortization) was an expense of $2 million for the first quarter of 2013 compared to an expense of $113 million for the prior year period.

Revenues

Total revenues increased $5 million or 1% compared to the prior year period.

Net investment income decreased $19 million or 5% compared to the prior year period reflecting a decrease in investment income on fixed maturities primarily due to lower invested assets and continued low interest rates.

Policy and contract charges increased $21 million or 5% compared to the prior year period.  The increase is primarily due to higher separate account fees driven by higher average separate account balances.

Other revenue increased $11 million or 14% compared to the prior year period reflecting higher marketing support due to higher average separate account balances.

Net realized investment losses for the three months ended March 31, 2013 were $1 million compared to net realized investment gains of $3 million in the prior year period.  In the three months ended March 31, 2013, other-than-temporary impairments recognized in earnings were $1 million which primarily related to credit losses on non-agency residential mortgage backed securities. In the three months ended March 31, 2012, net realized gains on Available-for-Sale securities due to sales, calls and tenders were $4 million offset by other-than-temporary impairments recognized in earnings of $1 million which related to credit losses on non-agency residential mortgage backed securities.

Benefits and Expenses

Total benefits and expenses decreased $99 million or 13% compared to the prior year period primarily due to a decrease in benefits, claims, losses and settlement expenses and other insurance and operating expenses partially offset by an increase in amortization of DAC.

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Benefits, claims, losses and settlement expenses decreased $115 million, or 33%, compared to the prior year period primarily due to the market impact on variable annuity guaranteed living benefits (net of hedges and the related DSIC amortization), which was an expense of $1 million in the first quarter of 2013 compared to an expense of $149 million for the first quarter of 2012 partially offset by higher reserve funding related to higher fees from variable annuity guarantees and a $23 million benefit from variable annuity model changes in the prior year period. The market impact on DSIC was a benefit of $3 million in the first quarter 2013 compared to a benefit of $6 million in the prior year period.

Amortization of DAC increased $42 million to $59 million for the three months ended March 31, 2013 compared to the prior year period primarily due to the DAC offset to the market impact on variable annuity guaranteed living benefits (net of hedges and the related DSIC amortization). The DAC offset to the market impact on variable annuity guaranteed living benefits (net of hedges and the related DSIC amortization) was an expense of $1 million for the first quarter of 2013 compared to a benefit of $36 million in the first quarter of 2012. The market impact on DAC was a benefit of $12 million for the first quarter of 2013 compared to a benefit of $20 million in the prior year period as a result of favorable equity market returns in the first quarter of 2013 compared to favorable equity and bond fund returns in the first quarter of 2012.

Other insurance and operating expenses decreased $18 million or 9% compared to the prior year period. The decrease is primarily due to a decrease in distribution expenses and allocated corporate overhead expenses.

Income Taxes

The Company’s effective tax rate was 18% for the three months ended March 31, 2013, compared to 10% for the three months ended March 31, 2012. The effective tax rate for both periods is lower than the statutory rates as a result of tax preferred items including the dividends received deduction, foreign tax credits and low income housing credits in comparison to the levels of pretax income.  The increase in the effective tax rate for the three months ended March 31, 2013 compared to the prior year period is a result of higher pretax income and lower dividends received deduction.

It is possible there will be corporate tax reform in the next few years.  While impossible to predict, corporate tax reform is likely to include a reduction in the corporate tax rate coupled with reductions in tax preferred items.  Any changes could have a material impact on the income tax expense and the deferred tax balances of the company.

Market Risk

The Company’s primary market risk exposures are interest rate, equity price and credit risk.  Equity price and interest rate fluctuations can have a significant impact on the Company’s results of operations, primarily due to the effects on asset-based fees and expenses, the “spread” income generated on its annuities and universal life (“UL”) insurance products, the value of DAC and DSIC assets, the value of liabilities for guaranteed benefits associated with its variable annuities and the value of derivatives held to hedge these benefits.

The guaranteed benefits associated with the Company’s variable annuities are guaranteed minimum withdrawal benefit (“GMWB”), guaranteed minimum accumulation benefits (“GMAB”), guaranteed minimum death benefits (“GMDB”) and guaranteed minimum income benefits (“GMIB”). Each of these guaranteed benefits guarantees payouts to the annuity holder under certain specific conditions regardless of the performance of the underlying investment assets.

The Company continues to utilize a hedging program which attempts to match the sensitivity of the assets with the sensitivity of the liabilities.  This approach works with the premise that matched sensitivities will produce a highly effective hedging result.  The Company’s comprehensive hedging program focuses mainly on first order sensitivities of assets and liabilities; Equity Market Level (Delta), Interest Rate Level (Rho) and Volatility (Vega).  Additionally, various second order sensitivities are managed.  The Company uses various index options across the term structure, interest rate swaps and swaptions, total return swaps and futures to manage the risk exposures.  The exposures are measured and monitored daily and adjustments to the hedge portfolio are made as necessary.

To evaluate interest rate and equity price risk, the Company performs sensitivity testing which measures the impact on pretax income from the sources listed below for a 12-month period following a hypothetical 100 basis point increase in interest rates or a hypothetical 10% decline in equity prices.  The interest rate risk test assumes a sudden 100 basis point parallel shift in the yield curve, with rates then staying at those levels for the next 12 months. The equity price risk test assumes a sudden 10% drop in equity prices, with equity prices then staying at those levels for the next 12 months. In estimating the values of variable annuity riders, equity indexed annuities, indexed universal life insurance and the associated hedge assets, the Company assumed no change in implied market volatility despite the 10% drop in equity prices.

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The following tables present the Company’s estimate of the impact on pretax income from these hypothetical market movements as of March 31, 2013.

	Equity Price Exposure to Pretax Income
Equity Price Decline 10%	Before Hedge Impact			Hedge Impact			Net Impact
	(in millions)
Asset-based fees and expenses	$	(75	)	$	—		$	(75	)
DAC and DSIC amortization(1) (2)	(82		)	—			(82		)
Variable annuity riders:
GMDB and GMIB(2)	(53		)	—			(53		)
GMWB	(107		)	128			21
GMAB	(46		)	57			11
DAC and DSIC amortization(3)	N/A			N/A			(7		)
Total variable annuity riders	(206		)	185			(28		)
Equity indexed annuities	1			(1		)	—
Indexed universal life insurance	5			(5		)	—
Total	$	(357	)	$	179		$	(185	)

	Interest Rate Exposure to Pretax Income
Interest Rate Increase 100 Basis Points	Before  Hedge Impact			Hedge Impact			Net Impact
	(in millions)
Asset-based fees and expenses	$	(23	)	$	—		$	(23	)
Variable annuity riders:
GMWB	583			(561		)	22
GMAB	34			(33		)	1
DAC and DSIC amortization(3)	N/A			N/A			(5		)
Total variable annuity riders	617			(594		)	18
Fixed annuities, fixed portion of variable annuities and fixed insurance products	86			—			86
Indexed universal life insurance	6			—			6
Total	$	686		$	(594	)	$	87

N/A     Not Applicable.

(1)   Market impact on DAC and DSIC amortization resulting from lower projected profits.

(2)In estimating the impact on DAC and DSIC amortization resulting from lower projected profits, the Company has not changed its assumed equity asset growth rates.  This is a significantly more conservative estimate than if the Company assumed management follows its mean reversion guideline and increased near-term rates to recover the drop in equity values over a five-year period.  The Company makes this same conservative assumption in estimating the impact from GMDB and GMIB riders.

(3)   Market impact on DAC and DSIC amortization related to variable annuity riders is modeled net of hedge impact.

The above results compare to an estimated negative net impact to pretax income of $203 million related to a 10% equity price decline and an estimated positive net impact to pretax income of $78 million related to a 100 basis point increase in interest rates as of December 31, 2012.

Net impacts shown in the above table from GMWB and GMAB riders result largely from differences between the liability valuation basis and the hedging basis. Liabilities are valued using fair value accounting principles, with key policyholder behavior assumptions loaded to provide risk margins and with discount rates increased to reflect a current market estimate of the Company’s risk of nonperformance specific to these liabilities. For variable annuity riders introduced prior to mid-2009, management elected to hedge based on best estimate policyholder behavior assumptions. For riders issued since mid-2009, management has been hedging on a basis that includes risk margins related to policyholder behavior.  The nonperformance spread risk is not hedged.

Actual results could differ materially from those illustrated above as they are based on a number of estimates and assumptions. These include assuming that implied market volatility does not change when equity prices fall by 10%, that management does not increase assumed equity asset growth rates to anticipate recovery of the drop in equity values when valuing DAC, DSIC and GMDB and GMIB liability values and that the 100 basis point increase in interest rates is a parallel shift of the yield curve. Furthermore, the Company has not tried to anticipate changes in client preferences for different types of assets or other changes in client behavior, nor has the Company tried to anticipate actions management might take to increase revenues or reduce expenses in these scenarios.

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The selection of a 100 basis point interest rate increase as well as a 10% equity price decline should not be construed as a prediction of future market events.  Impacts of larger or smaller changes in interest rates or equity prices may not be proportional to those shown for a 100 basis point increase in interest rates or a 10% decline in equity prices.

Fair Value Measurements

The Company reports certain assets and liabilities at fair value; specifically, separate account assets, derivatives, embedded derivatives, most investments and cash equivalents.  Fair value assumes the exchange of assets or liabilities occurs in orderly transactions and is not the result of a forced liquidation or distressed sale.  The Company includes actual market prices, or observable inputs, in its fair value measurements to the extent available.  Broker quotes are obtained when quotes from pricing services are not available.  The Company validates prices obtained from third parties through a variety of means such as: price variance analysis, subsequent sales testing, stale price review, price comparison across pricing vendors and due diligence reviews of vendors. See Note 10 to the Consolidated Financial Statements for additional information on the Company’s fair value measurements.

Fair Value of Liabilities and Nonperformance Risk

Companies are required to measure the fair value of liabilities at the price that would be received to transfer the liability to a market participant (an exit price).  Since there is not a market for the Company’s obligations of its variable annuity riders and indexed universal life insurance, the Company considers the assumptions participants in a hypothetical market would make to reflect an exit price.  As a result, the Company adjusts the valuation of variable annuity riders and indexed universal life insurance by updating certain contractholder assumptions, adding explicit margins to provide for profit, risk and expenses, and adjusting the rates used to discount expected cash flows to reflect a current market estimate of the Company’s nonperformance risk.  The nonperformance risk adjustment is based on broker quotes for credit default swaps that are adjusted to estimate the risk of the Company not fulfilling these liabilities.  Consistent with general market conditions, this estimate resulted in a spread over the LIBOR swap curve as of March 31, 2013.  As the Company’s estimate of this spread widens or tightens, the liability will decrease or increase.  If this nonperformance credit spread moves to a zero spread over the LIBOR swap curve, the reduction to net income would be approximately $154 million, net of DAC, DSIC and unearned revenue amortization, the reinsurance accrual and income taxes (calculated at the statutory tax rate of 35%), based on March 31, 2013 credit spreads.

Liquidity and Capital Resources

Liquidity Strategy

The liquidity requirements of the Company are generally met by funds provided by investment income, maturities and periodic repayments of investments, deposits, premiums and proceeds from sales of investments as well as capital contributions from Ameriprise Financial.  Other liquidity sources the Company has established are short-term borrowings and available lines of credit with Ameriprise Financial aggregating $1 billion.

The Company enters into short-term borrowings, which may include repurchase agreements and Federal Home Loan Bank (“FHLB”) advances to reduce reinvestment risk from higher levels of expected annuity net cash flows. Short-term borrowings allow the Company to receive cash to reinvest in longer-duration assets, while paying back the short-term debt with cash flows generated by the fixed income portfolio. The balance of repurchase agreements at March 31, 2013 and December 31, 2012 was $200 million and $501 million, respectively, which is collateralized with agency residential mortgage backed securities and commercial mortgage backed securities from the Company’s investment portfolio.  RiverSource Life Insurance Company is a member of the FHLB of Des Moines, which provides RiverSource Life Insurance Company access to collateralized borrowings.  At March 31, 2013 and December 31, 2012, the Company had borrowings of $300 million and nil, respectively, from the FHLB which is collateralized with commercial mortgage backed securities.

The outstanding balance under the lines of credit with Ameriprise Financial was $150 million at both March 31, 2013 and December 31, 2012.

The primary uses of funds are policy benefits, commissions, other product-related acquisition and sales inducement costs, operating expenses, policy loans, dividends to Ameriprise Financial and investment purchases.  The Company routinely reviews its sources and uses of funds in order to meet its ongoing obligations.

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Capital Activity

Dividends paid and received by RiverSource Life Insurance Company were as follows:

	Three Months Ended March 31,
	2013		2012
	(in millions)
Cash dividends paid to Ameriprise Financial	$	325	$	225

During the three months ended March 31, 2013 and 2012, RiverSource Life Insurance Company made a cash contribution to RTA of $15 million and $53 million, respectively, for ongoing funding commitments related to affordable housing partnership investments.

Regulatory Capital

RiverSource Life Insurance Company and RiverSource Life of NY are subject to regulatory capital requirements as follows:

	Actual Capital (a)				Regulatory Capital Requirement(b)
	March 31, 2013		December 31, 2012		December 31, 2012
	(in millions)
RiverSource Life Insurance Company	$	3,018	$	3,257	$	620
RiverSource Life Insurance Co. of New York	262		256		44

(a)Actual capital, as defined by the National Association of Insurance Commissioners for purposes of meeting regulatory capital requirements, includes statutory capital and surplus, plus certain statutory valuation reserves.

(b)Regulatory capital requirement is based on the statutory risk-based capital filing.

Contractual Commitments

There have been no material changes to the Company’s contractual obligations disclosed in the Company’s 2012 10-K.

Forward-Looking Statements

This report contains forward-looking statements that reflect the Company’s plans, estimates and beliefs.  The Company’s actual results could differ materially from those described in these forward-looking statements.  Examples of such forward-looking statements include:

·statements of the Company’s plans, intentions, expectations, objectives, or goals, including those related to the introduction, cessation, terms or pricing of new or existing products and services and the consolidated tax rate;

·other statements about future economic performance, the performance of equity markets and interest rate variations and the economic performance of the United States and of global markets; and

·statements of assumptions underlying such statements.

The words “believe,” “expect,” “anticipate,” “optimistic,” “intend,” “plan,” “aim,” “will,” “may,” “should,” “could,” “would,” “likely,” “forecast,” “on pace,” “project” and similar expressions are intended to identify forward-looking statements but are not the exclusive means of identifying such statements.  Forward-looking statements are subject to risks and uncertainties which could cause actual results to differ materially from such statements.

Such factors include, but are not limited to:

·conditions in the interest rate, credit default, equity market and foreign exchange environments, including changes in valuations, liquidity and volatility;

·changes in and the adoption of relevant accounting standards and securities rating agency standards and processes, as well as changes in the litigation and regulatory environment, including ongoing legal proceedings and regulatory actions, the frequency and extent of legal claims threatened or initiated by clients, other persons and regulators, and developments in regulation and legislation, including the rules and regulations implemented or to be implemented in connection with the Dodd-Frank Wall Street Reform and Consumer Protection Act;

·the Company’s investment management performance and consumer acceptance of the Company’s products;

·effects of competition in the financial services industry and changes in the Company’s product distribution mix and distribution channels;

·changes to the Company’s reputation that may arise from employee or Ameriprise Financial Services, Inc. advisor misconduct, legal or regulatory actions, improper management of conflicts of interest or otherwise;

·the Company’s capital structure as a subsidiary of Ameriprise Financial, including the ability of its parent to support its financial strength and ratings, as well as the opinions of rating agencies and other analysts or the Company’s regulators, distributors or policyholders and contractholders in response to any change or prospect of change in any such opinion;

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risks of default by issuers or guarantors of investments the Company owns or by counterparties to hedge derivative, insurance or reinsurance arrangements, experience deviations from the Company’s assumptions regarding such risks, the evaluations or the prospect of changes in evaluations of any such third parties published by rating agencies or other analysts and the reactions of other market participants or the Company’s regulators, distribution partners or customers in response to any such evaluation or prospect of changes in evaluation;

·experience deviations from the Company’s assumptions regarding morbidity, mortality and persistency in certain annuity and insurance products, or from assumptions regarding market returns assumed in valuing or unlocking DAC and DSIC or market volatility underlying the Company’s valuation and hedging of guaranteed living benefit annuity riders;

·successfully cross-selling insurance and annuity products and services to Ameriprise Financial’s customer base;

·the Company’s ability to effectively hedge risks relating to guaranteed benefit riders and certain other products;

·the impact of intercompany allocations to the Company from Ameriprise Financial and its affiliates;

·Ameriprise Financial’s ability to attract, recruit and retain qualified advisors and employees and its ability to distribute the Company’s products through current and future distribution channels;

·changes in capital requirements that may be indicated, required or advised by regulators or rating agencies;

·the impacts of Ameriprise Financial’s efforts to improve distribution economics and realize benefits from reengineering and tax planning;

·interruptions or other failures in the Company’s communications, technology and other operating systems, including errors or failures caused by third party service providers, interference or failures caused by third party attacks on the Company’s systems, or the failure to safeguard the privacy or confidentiality of sensitive information and data on such systems; and

·general economic and political factors, including consumer confidence in the economy, the ability and inclination of consumers generally to invest, as well as their ability and inclination to invest in financial instruments and products other than cash and cash equivalents, the costs of products and services the Company consumes in the conduct of its business, and applicable legislation and regulation and changes therein, including tax laws, tax treaties, fiscal and central government treasury policy, and policies regarding the financial services industry and regulatory rulings and pronouncements.

The Company cautions the reader that the foregoing list of factors is not exhaustive.  There may also be other risks that the Company is unable to predict at this time that may cause actual results to differ materially from those in forward-looking statements.  Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date on which they are made.  The Company undertakes no obligation to update publicly or revise any forward-looking statements.

The foregoing list of factors should be read in conjunction with the “Risk Factors” discussion as Part I, Item 1A in the Company’s 2012 10-K.

ITEM 4.  CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

The Company maintains disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) designed to provide reasonable assurance that the information required to be reported in the Exchange Act filings is recorded, processed, summarized and reported within the time periods specified in and pursuant to Securities and Exchange Commission regulations, including controls and procedures designed to ensure that this information is accumulated and communicated to the Company’s management, including its principal executive officer and chief financial officer, as appropriate, to allow timely decisions regarding the required disclosure.  It should be noted that, because of inherent limitations, the Company’s disclosure controls and procedures, however well designed and operated, can provide only reasonable, and not absolute, assurance that the objectives of the disclosure controls and procedures are met.

The Company’s management, under the supervision and with the participation of the Company’s principal executive officer and chief financial officer, evaluated the effectiveness of the disclosure controls and procedures as of the end of the period covered by this report.  Based upon that evaluation, the Company’s principal executive officer and chief financial officer have concluded that the Company’s disclosure controls and procedures were effective at a reasonable level of assurance as of March 31, 2013.

Changes in Internal Control over Financial Reporting

There have not been any changes in RiverSource Life Insurance Company’s internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the fiscal quarter to which this report relates that have materially affected, or are reasonably likely to materially affect, RiverSource Life Insurance Company’s internal control over financial reporting.

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PART II.               OTHER INFORMATION

ITEM 1.      LEGAL PROCEEDINGS

The information set forth in Note 15 to the Consolidated Financial Statements in Part I, Item 1 is incorporated herein by reference.

ITEM 1A.   RISK FACTORS

There have been no material changes in the risk factors provided in Part I, Item 1A of RiverSource Life Insurance Company’s 2012 10-K.

ITEM 6.      EXHIBITS

The list of exhibits required to be filed as exhibits to this report are listed on page E-1 hereof, under “Exhibit Index,” which is incorporated herein by reference.

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RIVERSOURCE LIFE INSURANCE COMPANY

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, thereunto duly authorized.

	RIVERSOURCE LIFE INSURANCE COMPANY
	(Registrant)
Date: May 1, 2013	By	/s/ John R. Woerner
		John R. Woerner
		Chairman and President
Date: May 1, 2013	By	/s/ Brian J. McGrane
		Brian J. McGrane
		Executive Vice President and Chief Financial Officer

37

RIVERSOURCE LIFE INSURANCE COMPANY

EXHIBIT INDEX

The following exhibits are filed as part of this Quarterly Report:

Exhibit	Description
3.1	Copy of Certificate of Incorporation of IDS Life Insurance Company, filed as Exhibit 3.1 to Post-Effective Amendment No. 5 to Registration Statement No. 33-28976, is incorporated by reference.
3.1.1	Copy of Certificate of Amendment of Certificate of Incorporation of IDS Life Insurance Company dated June 22, 2006, filed as Exhibit 3.1 to Form 8-K filed on January 5, 2007, is incorporated by reference.
3.2	Copy of Amended and Restated By-Laws of RiverSource Life Insurance Company dated June 22, 2006, filed as Exhibit 27(f)(2) to Post-Effective Amendment No. 28 to Registration Statement No. 333-69777, is incorporated by reference.
31.1*	Certification of John R. Woerner, Chairman and President, pursuant to Rule 13a-14(a) promulgated under the Securities Exchange Act of 1934, as amended.
31.2*	Certification of Brian J. McGrane, Chief Financial Officer, pursuant to Rule 13a-14(a) promulgated under the Securities Exchange Act of 1934, as amended.
32*	Certification of John R. Woerner, Chairman and President, and Brian J. McGrane, Chief Financial Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101*	The following materials from RiverSource Life Insurance Company’s Quarterly Report on Form 10-Q for the period ended March 31, 2013, formatted in XBRL: (i) Consolidated Balance Sheets at March 31, 2013 and December 31, 2012; (ii) Consolidated Statements of Income for the three months ended March 31, 2013 and 2012; (iii) Consolidated Statements of Comprehensive Income for the three months ended March 31, 2013 and 2012; (iv) Consolidated Statements of Shareholder’s Equity for the three months ended March 31, 2013 and 2012; (v) Consolidated Statements of Cash Flows for the three months ended March 31, 2013 and 2012; and (vi) Notes to the Consolidated Financial Statements.

*Filed electronically herewith.

E-1

EX-31.1

Exhibit 31.1

CERTIFICATION

I, John R. Woerner, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of RiverSource Life Insurance Company;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:   May 1, 2013

/s/ John R. Woerner
Name:	John R. Woerner
Title:	Chairman and President

EX-31.2

Exhibit 31.2

CERTIFICATION

I, Brian J. McGrane, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of RiverSource Life Insurance Company;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date:   May 1, 2013

/s/ Brian J. McGrane
Name:	Brian J. McGrane
Title:	Chief Financial Officer

EX-32

Exhibit 32

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED

PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report on Form 10-Q of RiverSource Life Insurance Company (the “Company”) for the quarterly period ended March 31, 2013, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), John R. Woerner, as Chairman and President of the Company, and Brian J. McGrane, Chief Financial Officer of the Company, each hereby certifies, pursuant to 18 U.S.C.  Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

(1)The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/  John R. Woerner
Name:	John R. Woerner
Title:	Chairman and President
Date:	May 1, 2013
/s/  Brian J. McGrane
Name:	Brian J. McGrane
Title:	Chief Financial Officer
Date:	May 1, 2013

XML

Investments (Details 5) (USD $) In Millions, unless otherwise specified	Mar. 31, 2013	Dec. 31, 2012
Amortized Cost
Due within one year	$ 1,547
Due after one year through five years	4,099
Due after five years through 10 years	6,716
Due after 10 years	3,555
Total having single maturity dates	15,917
Total	22,713	23,060
Fair Value
Due within one year	1,581
Due after one year through five years	4,437
Due after five years through 10 years	7,627
Due after 10 years	4,454
Total having single maturity dates	18,099
Total	25,372	25,936
Residential mortgage backed securities
Amortized Cost
Without single maturity dates	3,419
Total	3,419	3,446
Fair Value
Without single maturity dates	3,577
Total	3,577	3,621
Commercial mortgage backed securities
Amortized Cost
Without single maturity dates	2,578
Total	2,578	2,717
Fair Value
Without single maturity dates	2,825
Total	2,825	3,004
Asset backed securities
Amortized Cost
Without single maturity dates	797
Total	797	808
Fair Value
Without single maturity dates	867
Total	867	871
Common stocks
Amortized Cost
Without single maturity dates	2
Total	2	2
Fair Value
Without single maturity dates	4
Total	$ 4	$ 4

XML

Offsetting Assets and Liabilities (Details) (USD $) In Millions, unless otherwise specified	Mar. 31, 2013	Dec. 31, 2012
Derivatives:
Gross Amounts of Recognized Assets	$ 3,150	$ 3,418
Gross Amounts Not Offset in the Consolidated Balance Sheets
Financial Instruments	(2,630)	(2,676)
Cash Collateral	(150)	(262)
Securities Collateral	(241)	(355)
Net Amount	129	125
OTC derivatives
Derivatives:
Gross Amounts of Recognized Assets	3,056	3,322
Gross Amounts Not Offset in the Consolidated Balance Sheets
Financial Instruments	(2,630)	(2,676)
Cash Collateral	(150)	(262)
Securities Collateral	(241)	(355)
Net Amount	35	29
Exchange-traded derivatives
Derivatives:
Gross Amounts of Recognized Assets	94	96
Gross Amounts Not Offset in the Consolidated Balance Sheets
Net Amount	$ 94	$ 96

XML

Variable Annuity and Insurance Guarantees (Details 3) (USD $) In Millions, unless otherwise specified	Mar. 31, 2013	Dec. 31, 2012
Mutual funds
Variable Annuity and Insurance Guarantees
Total mutual funds	$ 64,061	$ 62,210
Equity
Variable Annuity and Insurance Guarantees
Total mutual funds	33,375	32,054
Bond
Variable Annuity and Insurance Guarantees
Total mutual funds	26,477	26,165
Other
Variable Annuity and Insurance Guarantees
Total mutual funds	$ 4,209	$ 3,991

XML

Offsetting Assets and Liabilities (Details 2) (USD $) In Millions, unless otherwise specified	Mar. 31, 2013	Dec. 31, 2012
Total
Gross Amounts of Recognized Liabilities	$ 3,531	$ 3,780
Gross Amounts Not Offset in the Consolidated Balance Sheets
Financial Instruments	(2,630)	(2,676)
Cash Collateral	(67)	(67)
Securities Collateral	(834)	(1,033)
Net Amount		4
Repurchase agreements
Gross Amounts of Recognized Liabilities	200	501
Gross Amounts Not Offset in the Consolidated Balance Sheets
Securities Collateral	(200)	(501)
OTC derivatives
Derivatives
Gross Amounts of Recognized Liabilities	3,331	3,279
Gross Amounts Not Offset in the Consolidated Balance Sheets
Financial Instruments	(2,630)	(2,676)
Cash Collateral	(67)	(67)
Securities Collateral	(634)	(532)
Net Amount		$ 4

XML

Variable Annuity and Insurance Guarantees (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended	12 Months Ended
	Mar. 31, 2013	Dec. 31, 2012
GMDB:
Variable Annuity and Insurance Guarantees
Total Contract Value	$ 69,642	$ 66,825
Contract Value in Separate Accounts	64,868	62,045
Net Amount at Risk	230	347
Weighted Average Attained Age	63 years	63 years
GMDB: | Return of premium
Variable Annuity and Insurance Guarantees
Total Contract Value	48,049	45,697
Contract Value in Separate Accounts	46,289	43,942
Net Amount at Risk	41	61
Weighted Average Attained Age	63 years	63 years
GMDB: | Five/six-year reset
Variable Annuity and Insurance Guarantees
Total Contract Value	11,382	11,233
Contract Value in Separate Accounts	8,874	8,722
Net Amount at Risk	78	115
Weighted Average Attained Age	63 years	63 years
GMDB: | One-year ratchet
Variable Annuity and Insurance Guarantees
Total Contract Value	7,552	7,367
Contract Value in Separate Accounts	7,126	6,933
Net Amount at Risk	61	106
Weighted Average Attained Age	65 years	65 years
GMDB: | Five-year ratchet
Variable Annuity and Insurance Guarantees
Total Contract Value	1,681	1,616
Contract Value in Separate Accounts	1,627	1,563
Net Amount at Risk	2	3
Weighted Average Attained Age	61 years	61 years
GMDB: | Other
Variable Annuity and Insurance Guarantees
Total Contract Value	978	912
Contract Value in Separate Accounts	952	885
Net Amount at Risk	48	62
Weighted Average Attained Age	68 years	68 years
GGU death benefit
Variable Annuity and Insurance Guarantees
Total Contract Value	990	958
Contract Value in Separate Accounts	939	907
Net Amount at Risk	104	93
Weighted Average Attained Age	63 years	63 years
GMIB
Variable Annuity and Insurance Guarantees
Total Contract Value	432	425
Contract Value in Separate Accounts	406	399
Net Amount at Risk	56	72
Weighted Average Attained Age	66 years	66 years
GMWB:
Variable Annuity and Insurance Guarantees
Total Contract Value	34,310	32,486
Contract Value in Separate Accounts	34,161	32,342
Net Amount at Risk	155	297
Weighted Average Attained Age	65 years	64 years
GMWB: | GMWB
Variable Annuity and Insurance Guarantees
Total Contract Value	3,980	3,898
Contract Value in Separate Accounts	3,962	3,880
Net Amount at Risk	15	34
Weighted Average Attained Age	66 years	66 years
GMWB: | GMWB for life
Variable Annuity and Insurance Guarantees
Total Contract Value	30,330	28,588
Contract Value in Separate Accounts	30,199	28,462
Net Amount at Risk	140	263
Weighted Average Attained Age	65 years	64 years
GMAB
Variable Annuity and Insurance Guarantees
Total Contract Value	3,936	3,773
Contract Value in Separate Accounts	3,924	3,762
Net Amount at Risk	$ 2	$ 5
Weighted Average Attained Age	57 years	57 years

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Recent Accounting Pronouncements (Details) (USD $) In Millions, unless otherwise specified	Mar. 31, 2013	Dec. 31, 2012	Mar. 31, 2012	Dec. 31, 2011	Jan. 02, 2012 Adoption of Accounting Standards Update 2010-26 Financial Services-Insurance (Topic 944) Cumulative effect of change in accounting policies, net of tax
Recent Accounting Pronouncements
Retained earnings	$ (915)	$ (1,000)			$ 1,400
Accumulated other comprehensive income, net of tax	1,158	1,234			112
Total shareholder's equity	$ (4,538)	$ (4,699)	$ (4,594)	$ (4,610)	$ 1,300

XML

Derivatives and Hedging Activities (Details 2) (USD $) In Millions, unless otherwise specified	Mar. 31, 2013	Dec. 31, 2012
Derivatives and Hedging Activities
Asset	$ 3,150	$ 3,418
Derivatives not designated as hedging instruments
Derivatives and Hedging Activities
Asset	3,150	3,418
Liability	3,661	4,159
Derivatives not designated as hedging instruments | GMWB and GMAB
Derivatives and Hedging Activities
Asset	3,136	3,412
Liability	3,592	4,111
Derivatives not designated as hedging instruments | GMWB and GMAB | Interest rate contracts
Derivatives and Hedging Activities
Asset	1,937	2,191
Liability	1,421	1,486
Derivatives not designated as hedging instruments | GMWB and GMAB | Equity contracts
Derivatives and Hedging Activities
Asset	1,192	1,215
Liability	1,904	1,792
Derivatives not designated as hedging instruments | GMWB and GMAB | Foreign currency contracts
Derivatives and Hedging Activities
Asset	7	6
Liability	1
Derivatives not designated as hedging instruments | GMWB and GMAB | Embedded derivatives
Derivatives and Hedging Activities
Liability	266	833
Derivatives not designated as hedging instruments | EIA embedded derivatives | Equity contracts
Derivatives and Hedging Activities
Liability	3	2
Derivatives not designated as hedging instruments | IUL | Equity contracts
Derivatives and Hedging Activities
Asset	14	6
Liability	5	1
Derivatives not designated as hedging instruments | IUL embedded derivatives | Equity contracts
Derivatives and Hedging Activities
Liability	61	45
Derivatives not designated as hedging instruments | Other derivatives
Derivatives and Hedging Activities
Asset	14	6
Liability	$ 69	$ 48

XML

Deferred Acquisition Costs and Deferred Sales Inducement Costs (Tables)

3 Months Ended

Mar. 31, 2013

Deferred Acquisition Costs and Deferred Sales Inducement Costs

Schedule of balances of and changes in DAC

	2013			2012
	(in millions)
Balance at January 1	$	2,373		$	2,413
Capitalization of acquisition costs	62			67
Amortization	(59		)	(17		)
Impact of change in net unrealized securities losses (gains)	33			(19		)
Balance at March 31	$	2,409		$	2,444

Schedule of balances of and changes in DSIC

	2013			2012
	(in millions)
Balance at January 1	$	404		$	464
Capitalization of sales inducement costs	2			2
Amortization	(12		)	(2		)
Impact of change in net unrealized securities losses (gains)	3			(4		)
Balance at March 31	$	397		$	460

XML

Fair Values of Assets and Liabilities (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended	12 Months Ended
	Mar. 31, 2013	Dec. 31, 2012
Assets
Available-for-Sale securities: Fixed maturities	$ 25,368	$ 25,932
Common stocks	4	4
Separate account assets	72,532	69,395
Liabilities
Future policy benefits	29,979	30,670
Cumulative decrease to the embedded derivative liability	295	389
Recurring basis | Level 1
Assets
Available-for-Sale securities: Fixed maturities	10	10
Common stocks	2	2
Other assets	339	285
Total assets at fair value	351	297
Liabilities
Other liabilities	141	258
Total liabilities at fair value	141	258
Recurring basis | Level 1 | Equity derivative contracts
Assets
Other assets	339	285
Liabilities
Other liabilities	141	258
Recurring basis | Level 1 | U.S. government and agencies obligations
Assets
Available-for-Sale securities: Fixed maturities	10	10
Recurring basis | Level 2
Assets
Available-for-Sale securities: Fixed maturities	23,369	23,919
Common stocks	2	2
Cash equivalents	137	264
Other assets	2,811	3,133
Separate account assets	72,532	69,395
Total assets at fair value	98,851	96,713
Liabilities
Future policy benefits	64	47
Other liabilities	3,190	3,021
Total liabilities at fair value	3,254	3,068
Recurring basis | Level 2 | Interest rate derivative contracts
Assets
Other assets	1,937	2,191
Liabilities
Other liabilities	1,421	1,486
Recurring basis | Level 2 | Equity derivative contracts
Assets
Other assets	867	936
Liabilities
Other liabilities	1,768	1,535
Recurring basis | Level 2 | Foreign currency derivative contracts
Assets
Other assets	7	6
Liabilities
Other liabilities	1
Recurring basis | Level 2 | EIA embedded derivatives
Liabilities
Future policy benefits	3	2
Recurring basis | Level 2 | IUL embedded derivatives
Liabilities
Future policy benefits	61	45
Recurring basis | Level 2 | Corporate debt securities
Assets
Available-for-Sale securities: Fixed maturities	15,067	15,387
Recurring basis | Level 2 | Residential mortgage backed securities
Assets
Available-for-Sale securities: Fixed maturities	3,569	3,598
Recurring basis | Level 2 | Commercial mortgage backed securities
Assets
Available-for-Sale securities: Fixed maturities	2,657	2,834
Recurring basis | Level 2 | State and municipal obligations
Assets
Available-for-Sale securities: Fixed maturities	1,117	1,122
Recurring basis | Level 2 | Asset backed securities
Assets
Available-for-Sale securities: Fixed maturities	707	715
Recurring basis | Level 2 | Foreign government bonds and obligations
Assets
Available-for-Sale securities: Fixed maturities	214	224
Recurring basis | Level 2 | U.S. government and agencies obligations
Assets
Available-for-Sale securities: Fixed maturities	38	39
Recurring basis | Level 3
Assets
Available-for-Sale securities: Fixed maturities	1,989	2,003
Total assets at fair value	1,989	2,003
Liabilities
Future policy benefits	266	833
Total liabilities at fair value	266	833
Recurring basis | Level 3 | GMWB and GMAB embedded derivatives
Liabilities
Future policy benefits	266	833
Recurring basis | Level 3 | Corporate debt securities
Assets
Available-for-Sale securities: Fixed maturities	1,653	1,654
Recurring basis | Level 3 | Residential mortgage backed securities
Assets
Available-for-Sale securities: Fixed maturities	8	23
Recurring basis | Level 3 | Commercial mortgage backed securities
Assets
Available-for-Sale securities: Fixed maturities	168	170
Recurring basis | Level 3 | Asset backed securities
Assets
Available-for-Sale securities: Fixed maturities	160	156
Recurring basis | Total
Assets
Available-for-Sale securities: Fixed maturities	25,368	25,932
Common stocks	4	4
Cash equivalents	137	264
Other assets	3,150	3,418
Separate account assets	72,532	69,395
Total assets at fair value	101,191	99,013
Liabilities
Future policy benefits	330	880
Other liabilities	3,331	3,279
Total liabilities at fair value	3,661	4,159
Recurring basis | Total | Interest rate derivative contracts
Assets
Other assets	1,937	2,191
Liabilities
Other liabilities	1,421	1,486
Recurring basis | Total | Equity derivative contracts
Assets
Other assets	1,206	1,221
Liabilities
Other liabilities	1,909	1,793
Recurring basis | Total | Foreign currency derivative contracts
Assets
Other assets	7	6
Liabilities
Other liabilities	1
Recurring basis | Total | EIA embedded derivatives
Liabilities
Future policy benefits	3	2
Recurring basis | Total | IUL embedded derivatives
Liabilities
Future policy benefits	61	45
Recurring basis | Total | GMWB and GMAB embedded derivatives
Liabilities
Future policy benefits	266	833
Recurring basis | Total | Corporate debt securities
Assets
Available-for-Sale securities: Fixed maturities	16,720	17,041
Recurring basis | Total | Residential mortgage backed securities
Assets
Available-for-Sale securities: Fixed maturities	3,577	3,621
Recurring basis | Total | Commercial mortgage backed securities
Assets
Available-for-Sale securities: Fixed maturities	2,825	3,004
Recurring basis | Total | State and municipal obligations
Assets
Available-for-Sale securities: Fixed maturities	1,117	1,122
Recurring basis | Total | Asset backed securities
Assets
Available-for-Sale securities: Fixed maturities	867	871
Recurring basis | Total | Foreign government bonds and obligations
Assets
Available-for-Sale securities: Fixed maturities	214	224
Recurring basis | Total | U.S. government and agencies obligations
Assets
Available-for-Sale securities: Fixed maturities	$ 48	$ 49

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Financing Receivables (Details 2) (USD $)																																											0 Months Ended		1 Months Ended
	Mar. 31, 2013	Dec. 31, 2012	Mar. 31, 2012	Dec. 31, 2011	Mar. 31, 2013 Syndicated Loans	Dec. 31, 2012 Syndicated Loans	Mar. 31, 2013 Commercial Mortgage Loans	Dec. 31, 2012 Commercial Mortgage Loans	Mar. 31, 2013 Commercial Mortgage Loans Retail	Dec. 31, 2012 Commercial Mortgage Loans Retail	Mar. 31, 2013 Commercial Mortgage Loans Office	Dec. 31, 2012 Commercial Mortgage Loans Office	Mar. 31, 2013 Commercial Mortgage Loans Industrial	Dec. 31, 2012 Commercial Mortgage Loans Industrial	Mar. 31, 2013 Commercial Mortgage Loans Apartments	Dec. 31, 2012 Commercial Mortgage Loans Apartments	Mar. 31, 2013 Commercial Mortgage Loans Hotel	Dec. 31, 2012 Commercial Mortgage Loans Hotel	Mar. 31, 2013 Commercial Mortgage Loans Mixed Use	Dec. 31, 2012 Commercial Mortgage Loans Mixed Use	Mar. 31, 2013 Commercial Mortgage Loans Other	Dec. 31, 2012 Commercial Mortgage Loans Other	Mar. 31, 2013 Commercial Mortgage Loans South Atlantic	Dec. 31, 2012 Commercial Mortgage Loans South Atlantic	Mar. 31, 2013 Commercial Mortgage Loans Pacific	Dec. 31, 2012 Commercial Mortgage Loans Pacific	Mar. 31, 2013 Commercial Mortgage Loans Mountain	Dec. 31, 2012 Commercial Mortgage Loans Mountain	Mar. 31, 2013 Commercial Mortgage Loans East North Central	Dec. 31, 2012 Commercial Mortgage Loans East North Central	Mar. 31, 2013 Commercial Mortgage Loans West North Central	Dec. 31, 2012 Commercial Mortgage Loans West North Central	Mar. 31, 2013 Commercial Mortgage Loans Middle Atlantic	Dec. 31, 2012 Commercial Mortgage Loans Middle Atlantic	Mar. 31, 2013 Commercial Mortgage Loans West South Central	Dec. 31, 2012 Commercial Mortgage Loans West South Central	Mar. 31, 2013 Commercial Mortgage Loans New England	Dec. 31, 2012 Commercial Mortgage Loans New England	Mar. 31, 2013 Commercial Mortgage Loans East South Central	Dec. 31, 2012 Commercial Mortgage Loans East South Central	Mar. 31, 2013 Residential Mortgage Loans item	Dec. 31, 2012 Residential Mortgage Loans	Mar. 31, 2013 Residential Mortgage Loans Ameriprise Bank, FSB	Dec. 31, 2012 Residential Mortgage Loans Ameriprise Bank, FSB	Oct. 31, 2012 Residential Mortgage Loans Ameriprise Bank, FSB
Financing Receivables
Percentage of loans with highest risk rating							2.00%	2.00%
Loans, gross	$ 3,685,000,000	$ 3,718,000,000					$ 2,501,000,000	$ 2,481,000,000	$ 853,000,000	$ 822,000,000	$ 590,000,000	$ 597,000,000	$ 439,000,000	$ 449,000,000	$ 423,000,000	$ 415,000,000	$ 35,000,000	$ 36,000,000	$ 33,000,000	$ 42,000,000	$ 128,000,000	$ 120,000,000	$ 644,000,000	$ 625,000,000	$ 575,000,000	$ 565,000,000	$ 266,000,000	$ 262,000,000	$ 255,000,000	$ 255,000,000	$ 205,000,000	$ 216,000,000	$ 196,000,000	$ 198,000,000	$ 162,000,000	$ 159,000,000	$ 130,000,000	$ 135,000,000	$ 68,000,000	$ 66,000,000
Less: allowance for loan losses	30,000,000	30,000,000	36,000,000	37,000,000			26,000,000	26,000,000
Total loans							2,475,000,000	2,455,000,000
Percent of Loans							100.00%	100.00%	34.00%	33.00%	24.00%	24.00%	18.00%	18.00%	17.00%	17.00%	1.00%	1.00%	1.00%	2.00%	5.00%	5.00%	26.00%	25.00%	23.00%	23.00%	11.00%	11.00%	10.00%	10.00%	8.00%	9.00%	8.00%	8.00%	6.00%	6.00%	5.00%	5.00%	3.00%	3.00%
Purchase of loans from affiliate																																													954,000,000
Allowance for loan losses on purchase of loans from affiliate																																											0	0	0
Percentage of residential mortgage loans below specified FICO scores																																									4.00%	3.00%
Percentage of residential mortgage loans above specified LTV ratios																																									1.00%	7.00%
Specified FICO Score																																									640
Specified LTV Ratios																																									90.00%
Percentage of total loan portfolio represented by state of California																																									38.00%	38.00%
Nonperforming loans	$ 10,000,000	$ 4,000,000			$ 2,000,000	$ 2,000,000

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Investments (Details 3) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2013 item	Mar. 31, 2012	Dec. 31, 2012 item
Number of Securities
Less than 12 months (number of positions)	74		57
12 months or more (number of positions)	62		69
Total (number of positions)	136		126
Fair Value
Less than 12 months	$ 926		$ 594
12 months or more	463		549
Total	1,389		1,143
Unrealized Losses
Less than 12 months	(13)		(4)
12 months or more	(80)		(98)
Total	(93)		(102)
Rollforward of the cumulative amounts recognized in the Consolidated Statements of Income for other-than-temporary impairments related to credit losses on securities
Beginning balance	87	106
Credit losses for which an other-than-temporary impairment was previously recognized	1	1
Reductions for securities sold during the period (realized)	(13)	(2)
Ending balance	75	105
Corporate debt securities
Number of Securities
Less than 12 months (number of positions)	50		50
12 months or more (number of positions)	5		6
Total (number of positions)	55		56
Fair Value
Less than 12 months	546		477
12 months or more	49		70
Total	595		547
Unrealized Losses
Less than 12 months	(7)		(4)
12 months or more	(3)		(3)
Total	(10)		(7)
Residential mortgage backed securities
Number of Securities
Less than 12 months (number of positions)	16		6
12 months or more (number of positions)	51		56
Total (number of positions)	67		62
Fair Value
Less than 12 months	320		107
12 months or more	250		293
Total	570		400
Unrealized Losses
Less than 12 months	(5)
12 months or more	(47)		(58)
Total	(52)		(58)
State and municipal obligations
Number of Securities
12 months or more (number of positions)	2		2
Total (number of positions)	2		2
Fair Value
12 months or more	105		100
Total	105		100
Unrealized Losses
12 months or more	(28)		(34)
Total	(28)		(34)
Asset backed securities
Number of Securities
Less than 12 months (number of positions)	2		1
12 months or more (number of positions)	4		5
Total (number of positions)	6		6
Fair Value
Less than 12 months	12		10
12 months or more	59		86
Total	71		96
Unrealized Losses
12 months or more	(2)		(3)
Total	(2)		(3)
Commercial mortgage backed securities
Number of Securities
Less than 12 months (number of positions)	6
Total (number of positions)	6
Fair Value
Less than 12 months	48
Total	48
Unrealized Losses
Less than 12 months	(1)
Total	$ (1)

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Fair Values of Assets and Liabilities (Details 3) (Discounted cash flow, USD $) In Millions, unless otherwise specified	3 Months Ended	12 Months Ended
	Mar. 31, 2013	Dec. 31, 2012
GMWB and GMAB embedded derivatives
Fair values of assets and liabilities
Fair Value	$ 266	$ 833
Nonperformance risk (as a percent)	0.93%	0.97%
GMWB and GMAB embedded derivatives | Minimum
Fair values of assets and liabilities
Utilization of guaranteed withdrawals (as a percent)	0.00%	0.00%
Surrender rate (as a percent)	0.00%	0.00%
Market volatility (as a percent)	5.20%	5.60%
GMWB and GMAB embedded derivatives | Maximum
Fair values of assets and liabilities
Utilization of guaranteed withdrawals (as a percent)	56.40%	56.40%
Surrender rate (as a percent)	56.30%	56.30%
Market volatility (as a percent)	20.20%	21.20%
Corporate debt securities (private placements)
Fair values of assets and liabilities
Fair Value	$ 1,625	$ 1,624
Corporate debt securities (private placements) | Minimum
Fair values of assets and liabilities
Yield/spread to U.S. Treasuries (as a percent)	1.10%	1.10%
Corporate debt securities (private placements) | Maximum
Fair values of assets and liabilities
Yield/spread to U.S. Treasuries (as a percent)	6.00%	8.50%
Corporate debt securities (private placements) | Weighted Average
Fair values of assets and liabilities
Yield/spread to U.S. Treasuries (as a percent)	2.00%	2.20%

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Shareholder's Equity (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2013	Mar. 31, 2012
Amounts Reclassified from AOCI
Net investment income	$ 358	$ 377
Income tax benefit	(54)	(19)
Net income	240	171
Net unrealized losses on Available-for-Sale securities
Amounts Reclassified from AOCI
Adjustments to AOCI for the impact to DAC, DSIC, benefit reserves and reinsurance recoverable on net unrealized securities gains, net of tax	64
Net unrealized losses on Available-for-Sale securities | Amount Reclassified from AOCI
Amounts Reclassified from AOCI
Net investment income	1
Income tax benefit	(1)
Losses on cash flow hedges: | Amount Reclassified from AOCI
Amounts Reclassified from AOCI
Net investment income	2
Income tax benefit	(1)
Net income	$ 1

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Variable Annuity and Insurance Guarantees (Details 2) (USD $) In Millions, unless otherwise specified	3 Months Ended					3 Months Ended
	Mar. 31, 2013 GMDB & GGU	Mar. 31, 2012 GMDB & GGU	Mar. 31, 2012 GMIB	Mar. 31, 2013 GMIB	Dec. 31, 2012 GMIB	Mar. 31, 2013 GMWB	Mar. 31, 2012 GMWB	Mar. 31, 2013 GMAB	Mar. 31, 2012 GMAB	Mar. 31, 2013 UL	Mar. 31, 2012 UL
Changes in additional liabilities for variable annuity and insurance guarantees
Balance at the beginning of the period	$ 4	$ 5	$ 9	$ 9	$ 9	$ 799	$ 1,377	$ 103	$ 237	$ 155	$ 111
Incurred claims	1		(2)			(480)	(624)	(80)	(119)	17	17
Paid claims	(1)	(2)								(3)	(4)
Balance at the end of the period	$ 4	$ 3	$ 7	$ 9	$ 9	$ 319	$ 753	$ 23	$ 118	$ 169	$ 124

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Recent Accounting Pronouncements

3 Months Ended

Mar. 31, 2013

Recent Accounting Pronouncements

Recent Accounting Pronouncements

2. Recent Accounting Pronouncements

Adoption of New Accounting Standards

Comprehensive Income

In February 2013, the Financial Accounting Standards Board (“FASB”) updated the accounting standard related to comprehensive income. The update requires entities to provide information about significant amounts reclassified out of accumulated other comprehensive income (“AOCI”). The standard is effective for interim and annual periods beginning after December 15, 2012 and is required to be applied prospectively. The Company adopted the standard in the first quarter of 2013. The adoption of the standard did not have any effect on the Company’s consolidated financial condition and results of operations. See Note 13 for the required disclosures.

Balance Sheet

In December 2011, the FASB updated the accounting standards to require new disclosures about offsetting assets and liabilities. The standard requires an entity to disclose both gross and net information about certain financial instruments and transactions subject to master netting arrangements (or similar agreements) or eligible for offset in the statement of financial position. The standard is effective for interim and annual periods beginning on or after January 1, 2013 on a retrospective basis. The Company adopted the standard in the first quarter of 2013. The adoption of the standard did not have any effect on the Company’s consolidated financial condition and results of operations. See Note 11 for the required disclosures.

Accounting for Costs Associated with Acquiring or Renewing Insurance Contracts

In October 2010, the FASB updated the accounting standard for deferred acquisition costs (“DAC”). Under this new standard, only the following costs incurred in the acquisition of new and renewal insurance contracts are capitalizable as DAC: (i) incremental direct costs of a successful contract acquisition, (ii) portions of employees’ compensation and benefits directly related to time spent performing acquisition activities (that is, underwriting, policy issuance and processing, medical and inspection, and contract selling) for a contract that has been acquired, (iii) other costs related to  acquisition activities that would not have been incurred had the acquisition of the contract not occurred, and (iv) advertising costs that meet the capitalization criteria in other GAAP guidance for certain direct-response marketing. All other acquisition related costs are expensed as incurred. The Company retrospectively adopted the new standard on January 1, 2012. The cumulative effect of the adoption reduced retained earnings by $1.4 billion after-tax and increased AOCI by $112 million after-tax, totaling to a $1.3 billion after-tax reduction in total equity at January 1, 2012.

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Income Taxes (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2013	Mar. 31, 2012	Dec. 31, 2012
Income Taxes
Effective tax rate (as a percent)	18.00%	10.00%
Maximum period for recognizing capital losses	5 years
Valuation Allowance	$ 5		$ 5
Gross unrecognized tax benefits	65		65
Unrecognized tax benefits, net of federal tax benefits that would affect the effective tax rate if recognized	8		8
Estimated decrease in amount of unrecognized tax benefits in next 12 months	63
Net increase (decrease) in interest and penalties	2	(5)
Payable (receivable) related to accrued interest and penalties	$ 32		$ 30

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Financing Receivables (Details 3) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2013 item	Mar. 31, 2012 item
Troubled Debt Restructurings
Number of Loans	2	1
Recorded Investment		$ 1
Commitments to lend additional funds to borrowers for restructured loans	0
Residential Mortgage Loans
Troubled Debt Restructurings
Number of Loans	2
Syndicated Loans
Troubled Debt Restructurings
Number of Loans		1
Recorded Investment		$ 1

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Offsetting Assets and Liabilities (Tables)

3 Months Ended

Mar. 31, 2013

Offsetting Assets and Liabilities

Schedule of gross and net information about the Company's assets subject to master netting arrangements

	March 31, 2013
			Gross		Amounts
	Gross		Amounts		of Assets		Gross Amounts Not Offset
	Amounts of		Offset in the		Presented in		in the Consolidated Balance Sheets
	Recognized		Consolidated		the Consolidated		Financial			Cash			Securities			Net
	Assets		Balance Sheets		Balance Sheets		Instruments(1)			Collateral			Collateral			Amount
	(in millions)
Derivatives:
OTC	$	3,056	$	—	$	3,056	$	(2,630	)	$	(150	)	$	(241	)	$	35
Exchange-traded	94		—		94		—			—			—			94
Total derivatives	$	3,150	$	—	$	3,150	$	(2,630	)	$	(150	)	$	(241	)	$	129

	December 31, 2012
			Gross		Amounts
	Gross		Amounts		of Assets		Gross Amounts Not Offset
	Amounts of		Offset in the		Presented in		in the Consolidated Balance Sheets
	Recognized		Consolidated		the Consolidated		Financial			Cash			Securities			Net
	Assets		Balance Sheets		Balance Sheets		Instruments(1)			Collateral			Collateral			Amount
	(in millions)
Derivatives:
OTC	$	3,322	$	—	$	3,322	$	(2,676	)	$	(262	)	$	(355	)	$	29
Exchange-traded	96		—		96		—			—			—			96
Total derivatives	$	3,418	$	—	$	3,418	$	(2,676	)	$	(262	)	$	(355	)	$	125

(1) Represents the amount of assets that could be offset by liabilities with the same counterparty under master netting or similar arrangements that management elects not to offset on the Consolidated Balance Sheets.

Schedule of gross and net information about the Company's liabilities subject to master netting arrangements

	March 31, 2013
			Gross		Amounts
	Gross		Amounts		of Liabilities		Gross Amounts Not Offset
	Amounts of		Offset in the		Presented in		in the Consolidated Balance Sheets
	Recognized		Consolidated		the Consolidated		Financial			Cash			Securities			Net
	Liabilities		Balance Sheets		Balance Sheets		Instruments(1)			Collateral			Collateral			Amount
	(in millions)
OTC derivatives	$	3,331	$	—	$	3,331	$	(2,630	)	$	(67	)	$	(634	)	$	—
Repurchase agreements	200		—		200		—			—			(200		)	—
Total	$	3,531	$	—	$	3,531	$	(2,630	)	$	(67	)	$	(834	)	$	—

	December 31, 2012
			Gross		Amounts
	Gross		Amounts		of Liabilities		Gross Amounts Not Offset
	Amounts of		Offset in the		Presented in		in the Consolidated Balance Sheets
	Recognized		Consolidated		the Consolidated		Financial			Cash			Securities			Net
	Liabilities		Balance Sheets		Balance Sheets		Instruments(1)			Collateral			Collateral			Amount
	(in millions)
OTC derivatives	$	3,279	$	—	$	3,279	$	(2,676	)	$	(67	)	$	(532	)	$	4
Repurchase agreements	501		—		501		—			—			(501		)	—
Total	$	3,780	$	—	$	3,780	$	(2,676	)	$	(67	)	$	(1,033	)	$	4

(1) Represents the amount of liabilities that could be offset by assets with the same counterparty under master netting or similar arrangements that management elects not to offset on the Consolidated Balance Sheets.

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Fair Values of Assets and Liabilities (Tables)

3 Months Ended

Mar. 31, 2013

Fair Values of Assets and Liabilities

Schedule of balances of assets and liabilities measured at fair value on a recurring basis

	March 31, 2013
	Level 1		Level 2		Level 3		Total
	(in millions)
Assets
Available-for-Sale securities:
Fixed maturities:
Corporate debt securities	$	—	$	15,067	$	1,653	$	16,720
Residential mortgage backed securities	—		3,569		8		3,577
Commercial mortgage backed securities	—		2,657		168		2,825
State and municipal obligations	—		1,117		—		1,117
Asset backed securities	—		707		160		867
Foreign government bonds and obligations	—		214		—		214
U.S. government and agencies obligations	10		38		—		48
Total Available-for-Sale securities: Fixed maturities	10		23,369		1,989		25,368
Common stocks	2		2		—		4
Cash equivalents	—		137		—		137
Other assets:
Interest rate derivative contracts	—		1,937		—		1,937
Equity derivative contracts	339		867		—		1,206
Foreign currency derivative contracts	—		7		—		7
Total other assets	339		2,811		—		3,150
Separate account assets	—		72,532		—		72,532
Total assets at fair value	$	351	$	98,851	$	1,989	$	101,191
Liabilities
Future policy benefits:
EIA embedded derivatives	$	—	$	3	$	—	$	3
IUL embedded derivatives	—		61		—		61
GMWB and GMAB embedded derivatives	—		—		266		266
Total future policy benefits	—		64		266		330		(1)
Other liabilities:
Interest rate derivative contracts	—		1,421		—		1,421
Equity derivative contracts	141		1,768		—		1,909
Foreign currency derivative contracts	—		1		—		1
Total other liabilities	141		3,190		—		3,331
Total liabilities at fair value	$	141	$	3,254	$	266	$	3,661

(1) The Company’s adjustment for nonperformance risk resulted in a $295 million cumulative decrease to the embedded derivative liability.

	December 31, 2012
	Level 1		Level 2		Level 3		Total
	(in millions)
Assets
Available-for-Sale securities:
Fixed maturities:
Corporate debt securities	$	—	$	15,387	$	1,654	$	17,041
Residential mortgage backed securities	—		3,598		23		3,621
Commercial mortgage backed securities	—		2,834		170		3,004
State and municipal obligations	—		1,122		—		1,122
Asset backed securities	—		715		156		871
Foreign government bonds and obligations	—		224		—		224
U.S. government and agencies obligations	10		39		—		49
Total Available-for-Sale securities: Fixed maturities	10		23,919		2,003		25,932
Common stocks	2		2		—		4
Cash equivalents	—		264		—		264
Other assets:
Interest rate derivative contracts	—		2,191		—		2,191
Equity derivative contracts	285		936		—		1,221
Foreign currency derivative contracts	—		6		—		6
Total other assets	285		3,133		—		3,418
Separate account assets	—		69,395		—		69,395
Total assets at fair value	$	297	$	96,713	$	2,003	$	99,013
Liabilities
Future policy benefits:
EIA embedded derivatives	$	—	$	2	$	—	$	2
IUL embedded derivatives	—		45		—		45
GMWB and GMAB embedded derivatives	—		—		833		833
Total future policy benefits	—		47		833		880		(1)
Other liabilities:
Interest rate derivative contracts	—		1,486		—		1,486
Equity derivative contracts	258		1,535		—		1,793
Total other liabilities	258		3,021		—		3,279
Total liabilities at fair value	$	258	$	3,068	$	833	$	4,159

(1) The Company’s adjustment for nonperformance risk resulted in a $389 million cumulative decrease to the embedded derivative liability.

Summary of changes in Level 3 assets and liabilities measured at fair value on a recurring basis

	Available-for-Sale Securities: Fixed Maturities															Future Policy
	Corporate Debt Securities			Residential Mortgage Backed Securities			Commercial Mortgage Backed Securities			Asset Backed Securities			Total			Benefits:GMWB and GMAB Embedded Derivatives
	(in millions)
Balance, January 1, 2013	$	1,654		$	23		$	170		$	156		$	2,003		$	(833	)
Total gains (losses) included in:
Net income	—			—			—			1			1		(1)	618		(2)
Other comprehensive income	—			—			(2		)	4			2			—
Purchases	54			—			—			—			54			—
Sales	—			—			—			—			—			—
Issues	—			—			—			—			—			(50		)
Settlements	(55		)	—			—			(1		)	(56		)	(1		)
Transfers into Level 3	—			—			—			—			—			—
Transfers out of Level 3	—			(15		)	—			—			(15		)	—
Balance, March 31, 2013	$	1,653		$	8		$	168		$	160		$	1,989		$	(266	)
Changes in unrealized gains (losses) relating to assets and liabilities held at March 31, 2013 included in:
Net investment income	$	—		$	—		$	—		$	1		$	1		$	—
Benefits, claims, losses and settlement expenses	—			—			—			—			—			609

(1) Represents a $1 million gain included in net investment income in the Consolidated Statements of Income.

(2) Included in benefits, claims, losses and settlement expenses in the Consolidated Statements of Income.

	Available-for-Sale Securities: Fixed Maturities																	Future Policy Benefits:
	Corporate Debt Securities			Residential Mortgage Backed Securities			Commercial Mortgage Backed Securities		Asset Backed Securities		Other Structured Investments		Total			Common Stock		GMWB and GMAB Embedded Derivatives
	(in millions)
Balance, January 1, 2012	$	1,342		$	58		$	16	$	133	$	14	$	1,563		$	—	$	(1,585	)
Total gains (losses) included in:
Net income	—			(2		)	—		—		—		(2		)(1)	—		784		(2)
Other comprehensive income	4			5			—		—		1		10			—		—
Purchases	98			24			—		—		—		122			1		—
Sales	—			—			—		—		—		—			—		—
Issues	—			—			—		—		—		—			—		(39		)
Settlements	(51		)	(3		)	—		—		—		(54		)	—		—
Transfers into Level 3	—			—			—		7		—		7			—		—
Transfers out of Level 3	—			—			—		—		—		—			—		—
Balance, March 31, 2012	$	1,393		$	82		$	16	$	140	$	15	$	1,646		$	1	$	(840	)
Changes in unrealized gains (losses) relating to assets and liabilities held at March 31, 2012 included in:
Net realized investment gains (losses)	$	—		$	2		$	—	$	—	$	—	$	2		$	—	$	—
Benefits, claims, losses and settlement expenses	—			—			—		—		—		—			—		769

(1)    Represents a $2 million loss included in net realized investment gains in the Consolidated Statements of Income.

(2)    Included in benefits, claims, losses and settlement expenses in the Consolidated Statements of Income.

Significant unobservable inputs used in the fair value measurements

	March 31, 2013
	Fair Value		Valuation Technique	Unobservable Input	Range (Weighted Average)
	(in millions)
Corporate debt securities (private placements)	$	1,625	Discounted cash flow	Yield/spread to U.S. Treasuries	1.1% – 6.0% (2.0%)
GMWB and GMAB embedded derivatives	$	266	Discounted cash flow	Utilization of guaranteed withdrawals(1)	0.0% – 56.4%
				Surrender rate	0.0% – 56.3%
				Market volatility(2)	5.2% – 20.2%
				Nonperformance risk(3)	93 bps

	December 31, 2012
	Fair Value		Valuation Technique	Unobservable Input	Range (Weighted Average)
	(in millions)
Corporate debt securities (private placements)	$	1,624	Discounted cash flow	Yield/spread to U.S. Treasuries	1.1% – 8.5% (2.2%)
GMWB and GMAB embedded derivatives	$	833	Discounted cash flow	Utilization of guaranteed withdrawals(1)	0.0% – 56.4%
				Surrender rate	0.0% – 56.3%
				Market volatility(2)	5.6% – 21.2%
				Nonperformance risk(3)	97 bps

(1) The utilization of the guaranteed withdrawals represents the percentage of policyholders that will begin withdrawing in any given year.

(2) Market volatility is implied volatility of fund of funds.

(3) The nonperformance risk is the spread added to the observable interest rates used in the valuation of the embedded derivative.

Schedule of carrying value and the estimated fair value of financial instruments that are not reported at fair value

	March 31, 2013
	Carrying		Fair Value
	Value		Level 1		Level 2		Level 3		Total
	(in millions)
Financial Assets
Mortgage loans, net	$	3,365	$	—	$	—	$	3,553	$	3,553
Policy loans	752		—		—		686		686
Other investments	314		—		284		37		321
Restricted cash	75		75		—		—		75
Financial Liabilities
Future policy benefits	$	14,548	$	—	$	—	$	15,578	$	15,578
Separate account liabilities	375		—		375		—		375
Line of credit with Ameriprise Financial	150		—		—		150		150
Short-term borrowings	500		—		500		—		500
Other liabilities	123		—		—		121		121

	December 31, 2012
	Carrying		Fair Value
	Value		Level 1		Level 2		Level 3		Total
	(in millions)
Financial Assets
Mortgage loans, net	$	3,389	$	—	$	—	$	3,568	$	3,568
Policy loans	752		—		—		725		725
Other investments	309		—		292		24		316
Restricted cash	86		86		—		—		86
Financial Liabilities
Future policy benefits	$	14,701	$	—	$	—	$	15,982	$	15,982
Separate account liabilities	360		—		360		—		360
Line of credit with Ameriprise Financial	150		—		—		150		150
Short-term borrowings	501		—		500		—		500
Other liabilities	144		—		—		142		142

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Derivatives and Hedging Activities (Details) (USD $)	3 Months Ended
	Mar. 31, 2013 item	Dec. 31, 2012
Net Derivative Liabilities
Additional quantitative measures to determine SIFI status	5
Fair value of derivatives after application of master netting agreements and cash collateral	$ 964,000,000	$ 1,416,000,000
Minimum
Net Derivative Liabilities
Threshold assets to determine the SIFI status	50,000,000,000
Additional quantitative measures to be met for the SIFI status	1
Threshold derivative liabilities to determine the SIFI status	3,500,000,000
OTC derivative
Net Derivative Liabilities
Fair value of derivatives after application of master netting agreements and cash collateral	634,000,000	536,000,000
Embedded derivatives
Net Derivative Liabilities
Fair value of embedded derivative liabilities	$ 330,000,000	$ 880,000,000

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Deferred Acquisition Costs and Deferred Sales Inducement Costs (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2013	Mar. 31, 2012
Balances of and changes in DAC
Balance at the beginning of the period	$ 2,373	$ 2,413
Capitalization of acquisition costs	62	67
Amortization	(59)	(17)
Impact of change in net unrealized securities losses (gains)	33	(19)
Balance at the end of the period	2,409	2,444
Balances of and changes in DSIC
Balance at the beginning of the period	404	464
Capitalization of sales inducement costs	2	2
Amortization	(12)	(2)
Impact of change in net unrealized securities losses (gains)	3	(4)
Balance at the end of the period	$ 397	$ 460

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Derivatives and Hedging Activities (Tables)

3 Months Ended

Mar. 31, 2013

Derivatives and Hedging Activities

Schedule of derivative liabilities as defined by the rule of guidance by FSOC

	March 31, 2013		December 31, 2012
	(in millions)
Fair value of OTC derivative liabilities after application of master netting agreements and cash collateral	$	634	$	536
Fair value of embedded derivative liabilities	330		880
Fair value of derivative liabilities after application of master netting agreements and cash collateral	$	964	$	1,416

Schedule of balance sheet location and gross fair value of derivative instruments, including embedded derivatives

		Asset					Liability
Derivatives not designated as hedging instruments	Balance Sheet Location	March 31, 2013		December 31, 2012		Balance Sheet Location	March 31, 2013		December 31, 2012
		(in millions)					(in millions)
GMWB and GMAB
Interest rate contracts	Other assets	$	1,937	$	2,191	Other liabilities	$	1,421	$	1,486
Equity contracts	Other assets	1,192		1,215		Other liabilities	1,904		1,792
Foreign currency contracts	Other assets	7		6		Other liabilities	1		—
Embedded derivatives(1)	Not applicable	—		—		Future policy benefits	266		833
Total GMWB and GMAB		3,136		3,412			3,592		4,111
Other derivatives:
Equity
EIA embedded derivatives	Not applicable	—		—		Future policy benefits	3		2
IUL	Other assets	14		6		Other liabilities	5		1
IUL embedded derivatives	Not applicable	—		—		Future policy benefits	61		45
Total other		14		6			69		48
Total derivatives		$	3,150	$	3,418		$	3,661	$	4,159

(1) The fair values of GMWB and GMAB embedded derivatives fluctuate based on changes in equity, interest rate and credit markets.

Schedule of impact of derivatives not designated as hedging instruments on the Consolidated Statements of Income

		Amount of Gain (Loss) on Derivatives
Derivatives not designated	Location of Gain (Loss) on	Recognized in Income
as hedging instruments	Derivatives Recognized in Income	2013			2012
		(in millions)
GMWB and GMAB
Interest rate contracts	Benefits, claims, losses and settlement expenses	$	(132	)	$	(225	)
Equity contracts	Benefits, claims, losses and settlement expenses	(492		)	(695		)
Credit contracts	Benefits, claims, losses and settlement expenses	—			(3		)
Foreign currency contracts	Benefits, claims, losses and settlement expenses	5			4
Embedded derivatives(1)	Benefits, claims, losses and settlement expenses	567			745
Total GMWB and GMAB		(52		)	(174		)
Other derivatives:
Equity
EIA	Interest credited to fixed accounts	1			1
EIA embedded derivatives	Interest credited to fixed accounts	(1		)	—
IUL	Interest credited to fixed accounts	4			—
IUL embedded derivatives	Interest credited to fixed accounts	3			—
Total other		7			1
Total derivatives		$	(45	)	$	(173	)

(1) The fair values of GMWB and GMAB embedded derivatives fluctuate based on changes in equity, interest rate and credit markets.

Schedule of payments the entity has to make and receive for the options related to minimum guaranteed benefits

	Premiums Payable		Premiums Receivable
	(in millions)
2013(1)	$	287	$	47
2014	344		54
2015	317		53
2016	287		46
2017	237		40
2018-2027	780		104

(1)   2013 amounts represent the amounts payable and receivable for the period from April 1, 2013 to December 31, 2013.

Summary of unrealized derivative losses included in accumulated other comprehensive income related to cash flow hedges

	2013			2012
	(in millions)
Net unrealized derivative losses at January 1	$	(21	)	$	(26	)
Reclassification of realized losses(1)	2			2
Income tax benefit	(1		)	(1		)
Net unrealized derivative losses at March 31	$	(20	)	$	(25	)

(1) Loss reclassified from AOCI to net investment income on the Consolidated Statements of Income.

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Shareholder's Equity (Tables)

3 Months Ended

Mar. 31, 2013

Shareholder's Equity

Schedule of information related to amounts reclassified from AOCI

AOCI Reclassification	Location of Gain (Loss) Recognized in Income	AmountReclassifiedfrom AOCI
		(in millions)
Net unrealized losses on Available-for-Sale securities	Net investment income	$	1
Tax benefit	Income tax provision	(1		)
Net of tax		$	—
Losses on cash flow hedges:
Swaptions	Net investment income	$	2
Tax benefit	Income tax provision	(1		)
Net of tax		$	1

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Basis of Presentation

3 Months Ended

Mar. 31, 2013

Basis of Presentation

Basis of Presentation

1. Basis of Presentation

RiverSource Life Insurance Company is a stock life insurance company with two wholly owned subsidiaries, RiverSource Life Insurance Co. of New York and RiverSource Tax Advantaged Investments, Inc. (“RTA”).  RiverSource Life Insurance Company is a wholly owned subsidiary of Ameriprise Financial, Inc. (“Ameriprise Financial”).

The accompanying Consolidated Financial Statements include the accounts of RiverSource Life Insurance Company and companies in which it directly or indirectly has a controlling financial interest (collectively, the “Company”). All intercompany transactions and balances have been eliminated in consolidation.

The interim financial information in this report has not been audited.  In the opinion of management, all adjustments necessary for a fair presentation of the consolidated financial position and results of operations for the interim periods have been made.   All adjustments made were of a normal recurring nature.

The accompanying Consolidated Financial Statements are prepared in accordance with U.S. generally accepted accounting principles (“GAAP”). Certain reclassifications of prior period amounts have been made to conform to the current presentation.  Results of operations reported for interim periods are not necessarily indicative of results for the entire year.  These Consolidated Financial Statements and Notes should be read in conjunction with the Consolidated Financial Statements and Notes in the Company’s Annual Report on Form 10-K for the year ended December 31, 2012, filed with the Securities and Exchange Commission on February 26, 2013.

The Company evaluated events or transactions that may have occurred after the balance sheet date for potential recognition or disclosure through the date the financial statements were issued.

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Basis of Presentation (Details)	Mar. 31, 2013 item
Basis of Presentation
Number of wholly owned subsidiaries	2

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Investments (Details 6) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2013	Mar. 31, 2012
Net investment income
Income on fixed maturities	$ 309	$ 342
Income on mortgage loans	51	35
Other investments	6	6
Gross investment income	366	383
Less: investment expenses	8	6
Total	$ 358	$ 377

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Fair Values of Assets and Liabilities (Details 4) (USD $) In Millions, unless otherwise specified	Mar. 31, 2013	Dec. 31, 2012
Financial Assets
Mortgage loans, net	$ 3,365	$ 3,389
Policy loans	752	752
Restricted cash	75	86
Financial Liabilities
Future policy benefits	29,979	30,670
Separate account liabilities	72,532	69,395
Line of credit with Ameriprise Financial	150	150
Carrying Value
Financial Assets
Mortgage loans, net	3,365	3,389
Policy loans	752	752
Other investments	314	309
Restricted cash	75	86
Financial Liabilities
Future policy benefits	14,548	14,701
Separate account liabilities	375	360
Line of credit with Ameriprise Financial	150	150
Short-term borrowings	500	501
Other liabilities	123	144
Fair Value | Level 1
Financial Assets
Restricted cash	75	86
Fair Value | Level 2
Financial Assets
Other investments	284	292
Financial Liabilities
Separate account liabilities	375	360
Short-term borrowings	500	500
Fair Value | Level 3
Financial Assets
Mortgage loans, net	3,553	3,568
Policy loans	686	725
Other investments	37	24
Financial Liabilities
Future policy benefits	15,578	15,982
Line of credit with Ameriprise Financial	150	150
Other liabilities	121	142
Fair Value | Total
Financial Assets
Mortgage loans, net	3,553	3,568
Policy loans	686	725
Other investments	321	316
Restricted cash	75	86
Financial Liabilities
Future policy benefits	15,578	15,982
Separate account liabilities	375	360
Line of credit with Ameriprise Financial	150	150
Short-term borrowings	500	500
Other liabilities	$ 121	$ 142

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CONSOLIDATED BALANCE SHEETS (USD $) In Millions, unless otherwise specified	Mar. 31, 2013	Dec. 31, 2012
Available-for-Sale:
Fixed maturities, at fair value (amortized cost: 2013, $22,711; 2012, $23,058)	$ 25,368	$ 25,932
Common stocks, at fair value (cost: 2013 and 2012, $2)	4	4
Mortgage loans, at amortized cost (less allowance for loan losses: 2013 and 2012, $26)	3,365	3,389
Policy loans	752	752
Other investments	750	743
Total investments	30,239	30,820
Cash and cash equivalents	150	336
Restricted cash	75	86
Reinsurance recoverables	2,082	2,047
Other receivables	151	203
Accrued investment income	277	291
Deferred acquisition costs	2,409	2,373
Deferred sales inducement costs	397	404
Other assets	3,521	3,793
Separate account assets	72,532	69,395
Total assets	111,833	109,748
Liabilities:
Future policy benefits	29,979	30,670
Policy claims and other policyholders' funds	145	132
Short-term borrowings	500	501
Line of credit with Ameriprise Financial, Inc.	150	150
Other liabilities	3,989	4,201
Separate account liabilities	72,532	69,395
Total liabilities	107,295	105,049
Shareholder's equity:
Common stock, $30 par value; 100,000 shares authorized, issued and outstanding	3	3
Additional paid-in capital	2,462	2,462
Retained earnings	915	1,000
Accumulated other comprehensive income, net of tax	1,158	1,234
Total shareholder's equity	4,538	4,699
Total liabilities and shareholder's equity	$ 111,833	$ 109,748

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Future Policy Benefits, Policy Claims and Other Policyholders' Funds and Separate Account Liabilities (Details) (USD $) In Millions, unless otherwise specified	Mar. 31, 2013	Dec. 31, 2012
Future Policy Benefits, Policy Claims and Other Policyholders' Funds and Separate Account Liabilities
Total future policy benefits	$ 29,979	$ 30,670
Policy claims and other policyholders' funds	145	132
Total future policy benefits and policy claims and other policyholders' funds	30,124	30,802
Separate account liabilities
Variable annuity variable sub-accounts	66,121	63,302
VUL insurance variable sub-accounts	6,368	6,051
Other insurance variable sub-accounts	43	42
Total	72,532	69,395
Fixed annuities
Future Policy Benefits, Policy Claims and Other Policyholders' Funds and Separate Account Liabilities
Total future policy benefits	15,905	16,075
Equity indexed annuity ("EIA") accumulated host values
Future Policy Benefits, Policy Claims and Other Policyholders' Funds and Separate Account Liabilities
Total future policy benefits	29	31
EIA embedded derivatives
Future Policy Benefits, Policy Claims and Other Policyholders' Funds and Separate Account Liabilities
Total future policy benefits	3	2
Variable annuity fixed sub-accounts
Future Policy Benefits, Policy Claims and Other Policyholders' Funds and Separate Account Liabilities
Total future policy benefits	4,832	4,843
Variable annuity guaranteed minimum withdrawal benefits ("GMWB")
Future Policy Benefits, Policy Claims and Other Policyholders' Funds and Separate Account Liabilities
Total future policy benefits	319	799
Variable annuity guaranteed minimum accumulation benefits ("GMAB")
Future Policy Benefits, Policy Claims and Other Policyholders' Funds and Separate Account Liabilities
Total future policy benefits	23	103
Other variable annuity guarantees
Future Policy Benefits, Policy Claims and Other Policyholders' Funds and Separate Account Liabilities
Total future policy benefits	13	13
Total annuities
Future Policy Benefits, Policy Claims and Other Policyholders' Funds and Separate Account Liabilities
Total future policy benefits	21,124	21,866
Variable universal life ("VUL")/universal life ("UL") insurance
Future Policy Benefits, Policy Claims and Other Policyholders' Funds and Separate Account Liabilities
Total future policy benefits	2,767	2,760
Indexed universal life ("IUL") accumulated host values
Future Policy Benefits, Policy Claims and Other Policyholders' Funds and Separate Account Liabilities
Total future policy benefits	74	59
IUL embedded derivatives
Future Policy Benefits, Policy Claims and Other Policyholders' Funds and Separate Account Liabilities
Total future policy benefits	61	45
VUL/UL insurance additional liabilities
Future Policy Benefits, Policy Claims and Other Policyholders' Funds and Separate Account Liabilities
Total future policy benefits	296	294
Other life, disability income and long term care insurance
Future Policy Benefits, Policy Claims and Other Policyholders' Funds and Separate Account Liabilities
Total future policy benefits	$ 5,657	$ 5,646

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CONSOLIDATED STATEMENTS OF SHAREHOLDER'S EQUITY (USD $) In Millions, unless otherwise specified	Total	Common Shares	Additional Paid-In Capital	Retained Earnings	Accumulated Other Comprehensive Income	Comprehensive Income
Balances at Dec. 31, 2011	$ 4,610	$ 3	$ 2,461	$ 1,215	$ 931
Comprehensive income:
Net income	171			171		171
Other comprehensive income (loss), net of tax	38				38	38
Total comprehensive income	209					209
Cash dividend to Ameriprise Financial, Inc.	(225)			(225)
Balances at Mar. 31, 2012	4,594	3	2,461	1,161	969
Balances at Dec. 31, 2012	4,699	3	2,462	1,000	1,234
Comprehensive income:
Net income	240			240		240
Other comprehensive income (loss), net of tax	(76)				(76)	(76)
Total comprehensive income	164					164
Cash dividend to Ameriprise Financial, Inc.	(325)			(325)
Balances at Mar. 31, 2013	$ 4,538	$ 3	$ 2,462	$ 915	$ 1,158

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Derivatives and Hedging Activities (Details 4) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2013	Mar. 31, 2012
Cash Flow Hedges
Derivatives designated as cash flow hedges	$ 0
Deferred loss on derivative instruments expected to be reclassified from accumulated other comprehensive income to earnings during the next 12 months	6
Rollforward of unrealized derivative losses included in accumulated other comprehensive income related to cash flow hedges
Net unrealized derivative losses at the beginning of the period	(21)	(26)
Reclassification of realized losses	2	2
Income tax benefit	(1)	(1)
Net unrealized derivative losses at the end of the period	(20)	(25)
Longest period of time over which the entity hedges exposure to the variability in future cash flows	6 years
2013
Summary of option premiums payable and receivable
Premiums Payable	287
Premiums Receivable	47
2014
Summary of option premiums payable and receivable
Premiums Payable	344
Premiums Receivable	54
2015
Summary of option premiums payable and receivable
Premiums Payable	317
Premiums Receivable	53
2016
Summary of option premiums payable and receivable
Premiums Payable	287
Premiums Receivable	46
2017
Summary of option premiums payable and receivable
Premiums Payable	237
Premiums Receivable	40
2018-2027
Summary of option premiums payable and receivable
Premiums Payable	780
Premiums Receivable	$ 104

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Investments (Details) (USD $) In Millions, unless otherwise specified	Mar. 31, 2013	Dec. 31, 2012
Investments
Amortized Cost	$ 22,713	$ 23,060
Gross Unrealized Gains	2,752	2,978
Gross Unrealized Losses	(93)	(102)
Fair Value	25,372	25,936
Noncredit OTTI	(18)	(23)
Corporate debt securities
Investments
Amortized Cost	14,725	14,881
Gross Unrealized Gains	2,005	2,167
Gross Unrealized Losses	(10)	(7)
Fair Value	16,720	17,041
Noncredit OTTI	2
Residential mortgage backed securities
Investments
Amortized Cost	3,419	3,446
Gross Unrealized Gains	210	233
Gross Unrealized Losses	(52)	(58)
Fair Value	3,577	3,621
Noncredit OTTI	(21)	(24)
Commercial mortgage backed securities
Investments
Amortized Cost	2,578	2,717
Gross Unrealized Gains	248	287
Gross Unrealized Losses	(1)
Fair Value	2,825	3,004
State and municipal obligations
Investments
Amortized Cost	967	976
Gross Unrealized Gains	178	180
Gross Unrealized Losses	(28)	(34)
Fair Value	1,117	1,122
Asset backed securities
Investments
Amortized Cost	797	808
Gross Unrealized Gains	72	66
Gross Unrealized Losses	(2)	(3)
Fair Value	867	871
Foreign government bonds and obligations
Investments
Amortized Cost	184	188
Gross Unrealized Gains	30	36
Fair Value	214	224
U.S. government and agencies obligations
Investments
Amortized Cost	41	42
Gross Unrealized Gains	7	7
Fair Value	48	49
Total fixed maturities
Investments
Amortized Cost	22,711	23,058
Gross Unrealized Gains	2,750	2,976
Gross Unrealized Losses	(93)	(102)
Fair Value	25,368	25,932
Noncredit OTTI	(19)	(24)
Common stocks
Investments
Amortized Cost	2	2
Gross Unrealized Gains	2	2
Fair Value	4	4
Noncredit OTTI	$ 1	$ 1

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Contingencies and Guarantees

3 Months Ended

Mar. 31, 2013

Contingencies and Guarantees

Contingencies and Guarantees

15. Contingencies and Guarantees

Insurance companies have been the subject of increasing regulatory, legislative and judicial scrutiny.  Numerous state and federal regulatory agencies have commenced examinations and other inquiries of insurance companies regarding sales and marketing practices (including sales to older consumers and disclosure practices), claims handling, and unclaimed property and escheatment practices and procedures. With regard to an industry-wide investigation of unclaimed property and escheatment practices and procedures, the Company is responding to regulatory audits, market conduct examinations and other inquires (including inquiries from the States of Minnesota and New York and a multistate insurance department examination).  The Company has cooperated and will continue to cooperate with the applicable regulators regarding their inquiries.

The Company is involved in the normal course of business in a number of other legal and arbitration proceedings concerning matters arising in connection with the conduct of its business activities.  The Company believes that it is not a party to, nor are any of its properties the subject of, any pending legal, arbitration or regulatory investigation or proceeding that is likely to have a material adverse effect on its consolidated financial condition, results of operations or liquidity.  Notwithstanding the foregoing, it is possible that the outcome of any current or future legal, arbitration or regulatory proceeding could have a material impact on results of operations in any particular reporting period as the proceedings are resolved.

The Company is required by law to be a member of the guaranty fund association in every state where it is licensed to do business.  In the event of insolvency of one or more unaffiliated insurance companies, the Company could be adversely affected by the requirement to pay assessments to the guaranty fund associations.  Uncertainty and volatility in the U.S. economy and financial markets in recent years have weakened the financial condition of numerous insurers, including insurers currently in receiverships, increasing the risk of triggering guaranty fund assessments.

The Company projects its cost of future guaranty fund assessments based on estimates of insurance company insolvencies provided by the National Organization of Life and Health Insurance Guaranty Associations (“NOLHGA”) and the amount of its premiums written relative to the industry-wide premium in each state.  The Company accrues the estimated cost of future guaranty fund assessments when it is considered probable that an assessment will be imposed, the event obligating the Company to pay the assessment has occurred  and the amount of the assessment can be reasonably estimated.

Executive Life Insurance Company of New York (“ELNY”) was placed into rehabilitation by a New York state court in 1991. On April 16, 2012, the court issued an order converting the rehabilitation into a liquidation proceeding under a plan submitted by the New York insurance regulator with support from NOLHGA and the industry.

During the second quarter of 2012, the Company established a liability for estimated guaranty fund assessments and a related premium tax asset, primarily associated with ELNY.  At both March 31, 2013 and December 31, 2012, the estimated liability was $26 million and the related premium tax asset was $19 million. The expected period over which the assessments will be made and the related tax credits recovered is not known.

Uncertain economic conditions, heightened and sustained volatility in the financial markets and significant financial reform legislation may increase the likelihood that clients and other persons or regulators may present or threaten legal claims or that regulators increase the scope or frequency of examinations of the Company or the insurance industry generally.

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Investments (Details 2) (USD $)	Mar. 31, 2013 item	Dec. 31, 2012
Investments
Amortized Cost	$ 22,713,000,000	$ 23,060,000,000
Fair Value	25,372,000,000	25,936,000,000
Percentage of GNMA, FNMA and FHLMC securities rated AAA	34.00%	32.00%
Number of holdings of other than GNMA, FNMA and FHLMC having greater than 10% of total equity	0
Holdings of Issuer Other Than GNMA, FNMA and FHLMC as Percentage of Shareholders Equity, Maximum	10.00%
AAA
Investments
Amortized Cost	5,405,000,000	5,680,000,000
Fair Value	5,846,000,000	6,198,000,000
Percent of Total Fair Value	23.00%	24.00%
AA
Investments
Amortized Cost	1,173,000,000	1,102,000,000
Fair Value	1,381,000,000	1,273,000,000
Percent of Total Fair Value	5.00%	5.00%
A
Investments
Amortized Cost	4,338,000,000	4,262,000,000
Fair Value	4,944,000,000	4,849,000,000
Percent of Total Fair Value	20.00%	19.00%
BBB
Investments
Amortized Cost	10,269,000,000	10,409,000,000
Fair Value	11,670,000,000	12,019,000,000
Percent of Total Fair Value	46.00%	46.00%
Below investment grade
Investments
Amortized Cost	1,526,000,000	1,605,000,000
Fair Value	1,527,000,000	1,593,000,000
Percent of Total Fair Value	6.00%	6.00%
Total fixed maturities
Investments
Fixed maturity securities as percentage of the entity's total investments	84.00%	84.00%
Amount of securities internally rated	1,400,000,000	1,500,000,000
Amortized Cost	22,711,000,000	23,058,000,000
Fair Value	$ 25,368,000,000	$ 25,932,000,000
Percent of Total Fair Value	100.00%	100.00%

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Financing Receivables (Tables)

3 Months Ended

Mar. 31, 2013

Financing Receivables

Rollforward of the allowance for loan losses

	March 31, 2013						March 31, 2012
	Commercial Mortgage Loans		Syndicated Loans		Total		Commercial Mortgage Loans		Syndicated Loans			Total
	(in millions)
Beginning balance	$	26	$	4	$	30	$	32	$	5		$	37
Charge-offs	—		—		—		—		(1		)	(1		)
Provisions	—		—		—		—		—			—
Ending balance	$	26	$	4	$	30	$	32	$	4		$	36
Individually evaluated for impairment	$	5	$	—	$	5	$	9	$	—		$	9
Collectively evaluated for impairment	21		4		25		23		4			27

Schedule of recorded investment in financing receivables by impairment method and type of loan

	March 31, 2013
	Commercial Mortgage Loans		Residential Mortgage Loans		Syndicated Loans		Total
	(in millions)
Individually evaluated for impairment	$	46	$	—	$	2	$	48
Collectively evaluated for impairment	2,455		890		292		3,637
Total	$	2,501	$	890	$	294	$	3,685

	December 31, 2012
	Commercial Mortgage Loans		Residential Mortgage Loans		Syndicated Loans		Total
	(in millions)
Individually evaluated for impairment	$	39	$	—	$	—	$	39
Collectively evaluated for impairment	2,442		934		303		3,679
Total	$	2,481	$	934	$	303	$	3,718

Schedule of purchases and sales of loans

	Three Months Ended March 31,
	2013		2012
	(in millions)
Purchases	$	22	$	29
Sales	1		—

Schedule of concentrations of credit risk of commercial mortgage loans by U.S. region

	Loans				Percentage
	March 31, 2013		December 31, 2012		March 31, 2013		December 31, 2012
	(in millions)
South Atlantic	$	644	$	625	26	%	25	%
Pacific	575		565		23		23
Mountain	266		262		11		11
East North Central	255		255		10		10
West North Central	205		216		8		9
Middle Atlantic	196		198		8		8
West South Central	162		159		6		6
New England	130		135		5		5
East South Central	68		66		3		3
	2,501		2,481		100	%	100	%
Less: allowance for loan losses	26		26
Total	$	2,475	$	2,455

Schedule of concentrations of credit risk of commercial mortgage loans by property type

	Loans				Percentage
	March 31, 2013		December 31, 2012		March 31, 2013		December 31, 2012
	(in millions)
Retail	$	853	$	822	34	%	33	%
Office	590		597		24		24
Industrial	439		449		18		18
Apartments	423		415		17		17
Hotel	35		36		1		1
Mixed use	33		42		1		2
Other	128		120		5		5
	2,501		2,481		100	%	100	%
Less: allowance for loan losses	26		26
Total	$	2,475	$	2,455

Schedule of troubled debt restructurings

	2013			2012
	Number of Loans	Recorded Investment		Number of Loans	Recorded Investment
	(in millions, except number of loans)
Residential mortgage loans	2	$	—	—	$	—
Syndicated loans	—	—		1	1
Total	2	$	—	1	$	1

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CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2013	Mar. 31, 2012
Cash Flows from Operating Activities
Net income	$ 240	$ 171
Adjustments to reconcile net income to net cash used in operating activities:
Depreciation, amortization and accretion, net	(6)	(3)
Deferred income tax expense (benefit)	85	(135)
Contractholder and policyholder charges, non-cash	(69)	(67)
Loss from equity method investments	7	8
Net realized investment gains	(1)	(4)
Other-than-temporary impairments and provision for loan losses recognized in net realized investment gains (losses)	2	1
Change in operating assets and liabilities:
Deferred acquisition costs	(3)	(50)
Deferred sales inducement costs	10
Future policy benefits for traditional life, disability income and long term care insurance	52	65
Policy claims and other policyholders' funds	13	14
Reinsurance recoverables	(33)	(34)
Other receivables	19	(51)
Accrued investment income	14	17
Derivatives collateral, net	(102)	(530)
Other, net	(286)	530
Net cash used in operating activities	(58)	(68)
Available-for-Sale securities:
Proceeds from sales	45	78
Maturities, sinking fund payments and calls	997	794
Purchases	(689)	(1,016)
Proceeds from sales, maturities and repayments of mortgage loans	178	43
Funding of mortgage loans	(148)	(62)
Proceeds from sales of other investments	35	31
Purchase of other investments	(67)	(67)
Purchase of land, buildings, equipment and software	(1)	(3)
Net cash provided by (used in) investing activities	350	(202)
Policyholder and contractholder account values:
Considerations received	303	392
Net transfers to separate accounts	(36)	(9)
Surrenders and other benefits	(321)	(335)
Change in short-term borrowings, net	(1)
Proceeds from line of credit with Ameriprise Financial, Inc.		100
Payments on line of credit with Ameriprise Financial, Inc.		(100)
Deferred premium options, net	(98)	(76)
Cash dividend to Ameriprise Financial, Inc.	(325)	(225)
Net cash used in financing activities	(478)	(253)
Net decrease in cash and cash equivalents	(186)	(523)
Cash and cash equivalents at beginning of period	336	828
Cash and cash equivalents at end of period	150	305
Supplemental Disclosures:
Income taxes paid (received), net	(3)	46
Interest paid on borrowings	1	1
Non-cash investing activity:
Affordable housing partnership commitments not yet remitted	$ 10

XML

CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $) In Millions, except Share data, unless otherwise specified	Mar. 31, 2013	Dec. 31, 2012
CONSOLIDATED BALANCE SHEETS
Fixed maturities, amortized cost	$ 22,711	$ 23,058
Common stocks, cost	2	2
Mortgage loans, allowance for loan losses	$ 26	$ 26
Common stock, par value (in dollars per share)	$ 30	$ 30
Common stock, shares authorized (in shares)	100,000	100,000
Common stock, shares issued (in shares)	100,000	100,000
Common stock, shares outstanding (in shares)	100,000	100,000

XML

Fair Values of Assets and Liabilities

3 Months Ended

Mar. 31, 2013

Fair Values of Assets and Liabilities

Fair Values of Assets and Liabilities

10. Fair Values of Assets and Liabilities

GAAP defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date; that is, an exit price.  The exit price assumes the asset or liability is not exchanged subject to a forced liquidation or distressed sale.

Valuation Hierarchy

The Company categorizes its fair value measurements according to a three-level hierarchy.  The hierarchy prioritizes the inputs used by the Company’s valuation techniques.  A level is assigned to each fair value measurement based on the lowest level input that is significant to the fair value measurement in its entirety.  The three levels of the fair value hierarchy are defined as follows:

Level 1 Unadjusted quoted prices for identical assets or liabilities in active markets that are accessible at the measurement date.

Level 2 Prices or valuations based on observable inputs other than quoted prices in active markets for identical assets and liabilities.

Level 3 Prices or valuations that require inputs that are both significant to the fair value measurement and unobservable.

The following tables present the balances of assets and liabilities measured at fair value on a recurring basis:

	March 31, 2013
	Level 1		Level 2		Level 3		Total
	(in millions)
Assets
Available-for-Sale securities:
Fixed maturities:
Corporate debt securities	$	—	$	15,067	$	1,653	$	16,720
Residential mortgage backed securities	—		3,569		8		3,577
Commercial mortgage backed securities	—		2,657		168		2,825
State and municipal obligations	—		1,117		—		1,117
Asset backed securities	—		707		160		867
Foreign government bonds and obligations	—		214		—		214
U.S. government and agencies obligations	10		38		—		48
Total Available-for-Sale securities: Fixed maturities	10		23,369		1,989		25,368
Common stocks	2		2		—		4
Cash equivalents	—		137		—		137
Other assets:
Interest rate derivative contracts	—		1,937		—		1,937
Equity derivative contracts	339		867		—		1,206
Foreign currency derivative contracts	—		7		—		7
Total other assets	339		2,811		—		3,150
Separate account assets	—		72,532		—		72,532
Total assets at fair value	$	351	$	98,851	$	1,989	$	101,191
Liabilities
Future policy benefits:
EIA embedded derivatives	$	—	$	3	$	—	$	3
IUL embedded derivatives	—		61		—		61
GMWB and GMAB embedded derivatives	—		—		266		266
Total future policy benefits	—		64		266		330		(1)
Other liabilities:
Interest rate derivative contracts	—		1,421		—		1,421
Equity derivative contracts	141		1,768		—		1,909
Foreign currency derivative contracts	—		1		—		1
Total other liabilities	141		3,190		—		3,331
Total liabilities at fair value	$	141	$	3,254	$	266	$	3,661

(1) The Company’s adjustment for nonperformance risk resulted in a $295 million cumulative decrease to the embedded derivative liability.

	December 31, 2012
	Level 1		Level 2		Level 3		Total
	(in millions)
Assets
Available-for-Sale securities:
Fixed maturities:
Corporate debt securities	$	—	$	15,387	$	1,654	$	17,041
Residential mortgage backed securities	—		3,598		23		3,621
Commercial mortgage backed securities	—		2,834		170		3,004
State and municipal obligations	—		1,122		—		1,122
Asset backed securities	—		715		156		871
Foreign government bonds and obligations	—		224		—		224
U.S. government and agencies obligations	10		39		—		49
Total Available-for-Sale securities: Fixed maturities	10		23,919		2,003		25,932
Common stocks	2		2		—		4
Cash equivalents	—		264		—		264
Other assets:
Interest rate derivative contracts	—		2,191		—		2,191
Equity derivative contracts	285		936		—		1,221
Foreign currency derivative contracts	—		6		—		6
Total other assets	285		3,133		—		3,418
Separate account assets	—		69,395		—		69,395
Total assets at fair value	$	297	$	96,713	$	2,003	$	99,013
Liabilities
Future policy benefits:
EIA embedded derivatives	$	—	$	2	$	—	$	2
IUL embedded derivatives	—		45		—		45
GMWB and GMAB embedded derivatives	—		—		833		833
Total future policy benefits	—		47		833		880		(1)
Other liabilities:
Interest rate derivative contracts	—		1,486		—		1,486
Equity derivative contracts	258		1,535		—		1,793
Total other liabilities	258		3,021		—		3,279
Total liabilities at fair value	$	258	$	3,068	$	833	$	4,159

(1) The Company’s adjustment for nonperformance risk resulted in a $389 million cumulative decrease to the embedded derivative liability.

The following tables provide a summary of changes in Level 3 assets and liabilities measured at fair value on a recurring basis:

	Available-for-Sale Securities: Fixed Maturities															Future Policy
	Corporate Debt Securities			Residential Mortgage Backed Securities			Commercial Mortgage Backed Securities			Asset Backed Securities			Total			Benefits:GMWB and GMAB Embedded Derivatives
	(in millions)
Balance, January 1, 2013	$	1,654		$	23		$	170		$	156		$	2,003		$	(833	)
Total gains (losses) included in:
Net income	—			—			—			1			1		(1)	618		(2)
Other comprehensive income	—			—			(2		)	4			2			—
Purchases	54			—			—			—			54			—
Sales	—			—			—			—			—			—
Issues	—			—			—			—			—			(50		)
Settlements	(55		)	—			—			(1		)	(56		)	(1		)
Transfers into Level 3	—			—			—			—			—			—
Transfers out of Level 3	—			(15		)	—			—			(15		)	—
Balance, March 31, 2013	$	1,653		$	8		$	168		$	160		$	1,989		$	(266	)
Changes in unrealized gains (losses) relating to assets and liabilities held at March 31, 2013 included in:
Net investment income	$	—		$	—		$	—		$	1		$	1		$	—
Benefits, claims, losses and settlement expenses	—			—			—			—			—			609

(1) Represents a $1 million gain included in net investment income in the Consolidated Statements of Income.

(2) Included in benefits, claims, losses and settlement expenses in the Consolidated Statements of Income.

	Available-for-Sale Securities: Fixed Maturities																	Future Policy Benefits:
	Corporate Debt Securities			Residential Mortgage Backed Securities			Commercial Mortgage Backed Securities		Asset Backed Securities		Other Structured Investments		Total			Common Stock		GMWB and GMAB Embedded Derivatives
	(in millions)
Balance, January 1, 2012	$	1,342		$	58		$	16	$	133	$	14	$	1,563		$	—	$	(1,585	)
Total gains (losses) included in:
Net income	—			(2		)	—		—		—		(2		)(1)	—		784		(2)
Other comprehensive income	4			5			—		—		1		10			—		—
Purchases	98			24			—		—		—		122			1		—
Sales	—			—			—		—		—		—			—		—
Issues	—			—			—		—		—		—			—		(39		)
Settlements	(51		)	(3		)	—		—		—		(54		)	—		—
Transfers into Level 3	—			—			—		7		—		7			—		—
Transfers out of Level 3	—			—			—		—		—		—			—		—
Balance, March 31, 2012	$	1,393		$	82		$	16	$	140	$	15	$	1,646		$	1	$	(840	)
Changes in unrealized gains (losses) relating to assets and liabilities held at March 31, 2012 included in:
Net realized investment gains (losses)	$	—		$	2		$	—	$	—	$	—	$	2		$	—	$	—
Benefits, claims, losses and settlement expenses	—			—			—		—		—		—			—		769

(1)    Represents a $2 million loss included in net realized investment gains in the Consolidated Statements of Income.

(2)    Included in benefits, claims, losses and settlement expenses in the Consolidated Statements of Income.

The impact to pretax income of the Company’s adjustment for nonperformance risk on the fair value of its GMWB and GMAB embedded derivatives was $(65) million and $(115) million, net of DAC and DSIC amortization, for the three months ended March 31, 2013 and 2012, respectively.

Securities transferred from Level 3 primarily represent securities with fair values that are now obtained from a third party pricing service with observable inputs.  Securities transferred to Level 3 represent securities with fair values that are now based on a single non-binding broker quote.  The Company recognizes transfers between levels of the fair value hierarchy as of the beginning of the quarter in which each transfer occurred.  For assets and liabilities held at the end of the reporting periods that are measured at fair value on a recurring basis, there were no transfers between Level 1 and Level 2.

The following tables provide a summary of the significant unobservable inputs used in the fair value measurements developed by the Company or reasonably available to the Company of Level 3 assets and liabilities:

	March 31, 2013
	Fair Value		Valuation Technique	Unobservable Input	Range (Weighted Average)
	(in millions)
Corporate debt securities (private placements)	$	1,625	Discounted cash flow	Yield/spread to U.S. Treasuries	1.1% – 6.0% (2.0%)
GMWB and GMAB embedded derivatives	$	266	Discounted cash flow	Utilization of guaranteed withdrawals(1)	0.0% – 56.4%
				Surrender rate	0.0% – 56.3%
				Market volatility(2)	5.2% – 20.2%
				Nonperformance risk(3)	93 bps

	December 31, 2012
	Fair Value		Valuation Technique	Unobservable Input	Range (Weighted Average)
	(in millions)
Corporate debt securities (private placements)	$	1,624	Discounted cash flow	Yield/spread to U.S. Treasuries	1.1% – 8.5% (2.2%)
GMWB and GMAB embedded derivatives	$	833	Discounted cash flow	Utilization of guaranteed withdrawals(1)	0.0% – 56.4%
				Surrender rate	0.0% – 56.3%
				Market volatility(2)	5.6% – 21.2%
				Nonperformance risk(3)	97 bps

(1) The utilization of the guaranteed withdrawals represents the percentage of policyholders that will begin withdrawing in any given year.

(2) Market volatility is implied volatility of fund of funds.

(3) The nonperformance risk is the spread added to the observable interest rates used in the valuation of the embedded derivative.

Level 3 measurements not included in the table above are obtained from non-binding broker quotes where unobservable inputs are not reasonably available to the Company.

Sensitivity of Fair Value Measurements to Changes in Unobservable Inputs

Significant increases (decreases) in the yield/spread to U.S. Treasuries used in the fair value measurement of Level 3 corporate debt securities in isolation would result in a significantly lower (higher) fair value measurement.

Significant increases (decreases) in utilization and volatility used in the fair value measurement of the GMWB and GMAB embedded derivatives in isolation would result in a significantly higher (lower) fair value measurement. Significant increases (decreases) in surrender rate and nonperformance risk used in the fair value measurement of the GMWB and GMAB embedded derivatives in isolation would result in a significantly lower (higher) fair value measurement. Utilization of guaranteed withdrawals and surrender rates vary with the type of rider, the duration of the policy, the age of the contractholder, the distribution system and whether the value of the guaranteed benefit exceeds the contract accumulation value.

Determination of Fair Value

The Company uses valuation techniques consistent with the market and income approaches to measure the fair value of its assets and liabilities.  The Company’s market approach uses prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities.  The Company’s income approach uses valuation techniques to convert future projected cash flows to a single discounted present value amount.  When applying either approach, the Company maximizes the use of observable inputs and minimizes the use of unobservable inputs.

The following is a description of the valuation techniques used to measure fair value and the general classification of these instruments pursuant to the fair value hierarchy.

Assets

Cash Equivalents

Cash equivalents include highly liquid investments with original maturities of 90 days or less. Cash equivalents are classified as Level 2 and measured at amortized cost, which is a reasonable estimate of fair value because of the short time between the purchase of the instrument and its expected realization.

Available-for-Sale Securities

When available, the fair value of securities is based on quoted prices in active markets.  If quoted prices are not available, fair values are obtained from third party pricing services, non-binding broker quotes, or other model-based valuation techniques.  Level 1 securities include U.S. Treasuries.  Level 2 securities include corporate bonds, residential mortgage backed securities, commercial mortgage backed securities, municipal bonds, asset backed securities and U.S. agency and foreign government securities.  The fair value of these Level 2 securities is based on a market approach with prices obtained from third party pricing services.  Observable inputs used to value these securities can include, but are not limited to, reported trades, benchmark yields, issuer spreads and non-binding broker quotes.  Level 3 securities primarily include certain corporate bonds, non-agency residential mortgage backed securities, commercial mortgage backed securities and asset backed securities.  The fair value of corporate bonds, non-agency residential mortgage backed securities, commercial mortgage backed securities and certain asset backed securities classified as Level 3 is typically based on a single non-binding broker quote. The underlying inputs used for some of the non-binding broker quotes are not readily available to the Company.

In consideration of the above, management is responsible for the fair values recorded on the financial statements. Prices received from third party pricing services are subjected to exception reporting that identifies investments with significant daily price movements as well as no movements.  The Company reviews the exception reporting and resolves the exceptions through reaffirmation of the price or recording an appropriate fair value estimate.  The Company also performs subsequent transaction testing.  The Company performs annual due diligence of third party pricing services.  The Company’s due diligence procedures include assessing the vendor’s valuation qualifications, control environment, analysis of asset-class specific valuation methodologies, and understanding of sources of market observable assumptions and unobservable assumptions, if any, employed in the valuation methodology.  The Company also considers the results of its exception reporting controls and any resulting price challenges that arise.

Separate Account Assets

The fair value of assets held by separate accounts is determined by the net asset value (“NAV”) of the funds in which those separate accounts are invested.  The NAV represents the exit price for the separate account.  Separate account assets are classified as Level 2 as they are traded in principal-to-principal markets with little publicly released pricing information.

Other Assets

Derivatives that are measured using quoted prices in active markets, such as derivatives that are exchange-traded, are classified as Level 1 measurements.  The fair value of derivatives that are traded in less active over-the-counter  (“OTC”) markets are generally measured using pricing models with market observable inputs such as interest rates and equity index levels.  These measurements are classified as Level 2 within the fair value hierarchy and include swaps and the majority of options.  The counterparties’ nonperformance risk associated with uncollateralized derivative assets was immaterial at March 31, 2013 and December 31, 2012.  See Note 11 and Note 12 for further information on the credit risk of derivative instruments and related collateral.

Liabilities

Future Policy Benefits

The Company values the embedded derivative liability attributable to the provisions of certain variable annuity riders using internal valuation models.  These models calculate fair value by discounting expected cash flows from benefits plus margins for profit, risk and expenses less embedded derivative fees.  The projected cash flows used by these models include observable capital market assumptions and incorporate significant unobservable inputs related to contractholder behavior assumptions, implied volatility and margins for risk, profit and expenses that the Company believes an exit market participant would expect.  The fair value of these embedded derivatives also reflects a current estimate of the Company’s nonperformance risk specific to these liabilities.  Given the significant unobservable inputs to this valuation, these measurements are classified as Level 3.  The embedded derivative liability attributable to these provisions is recorded in future policy benefits.

The Company’s Corporate Actuarial Department calculates the fair value of the GMWB and GMAB embedded derivatives on a monthly basis. During this process, control checks are performed to validate the completeness of the data. Actuarial management approves various components of the valuation along with the final results. The change in the fair value of the embedded derivatives is reviewed monthly with senior management. The Level 3 inputs into the valuation are consistent with the pricing assumptions and updated as experience develops.  Significant unobservable inputs that reflect policyholder behavior are reviewed quarterly along with other valuation assumptions.

The Company uses various Black-Scholes calculations to determine the fair value of the embedded derivative liability associated with the provisions of its EIA and IUL products.  The inputs to these calculations are primarily market observable and include interest rates, volatilities and equity index levels.  As a result, these measurements are classified as Level 2.

Other Liabilities

Derivatives that are measured using quoted prices in active markets, such as derivatives that are exchange-traded, are classified as Level 1 measurements.  The fair value of derivatives that are traded in less active OTC markets are generally measured using pricing models with market observable inputs such as interest rates and equity index levels.  These measurements are classified as Level 2 within the fair value hierarchy and include swaps and the majority of options. The Company’s nonperformance risk associated with uncollateralized derivative liabilities was immaterial at March 31, 2013 and December 31, 2012.  See Note 11 and Note 12 for further information on the credit risk of derivative instruments and related collateral.

During the reporting periods, there were no material assets or liabilities measured at fair value on a nonrecurring basis.

The following tables provide the carrying value and the estimated fair value of financial instruments that are not reported at fair value.  All other financial instruments that are reported at fair value have been included above in the table with balances of assets and liabilities measured at fair value on a recurring basis.

	March 31, 2013
	Carrying		Fair Value
	Value		Level 1		Level 2		Level 3		Total
	(in millions)
Financial Assets
Mortgage loans, net	$	3,365	$	—	$	—	$	3,553	$	3,553
Policy loans	752		—		—		686		686
Other investments	314		—		284		37		321
Restricted cash	75		75		—		—		75
Financial Liabilities
Future policy benefits	$	14,548	$	—	$	—	$	15,578	$	15,578
Separate account liabilities	375		—		375		—		375
Line of credit with Ameriprise Financial	150		—		—		150		150
Short-term borrowings	500		—		500		—		500
Other liabilities	123		—		—		121		121

	December 31, 2012
	Carrying		Fair Value
	Value		Level 1		Level 2		Level 3		Total
	(in millions)
Financial Assets
Mortgage loans, net	$	3,389	$	—	$	—	$	3,568	$	3,568
Policy loans	752		—		—		725		725
Other investments	309		—		292		24		316
Restricted cash	86		86		—		—		86
Financial Liabilities
Future policy benefits	$	14,701	$	—	$	—	$	15,982	$	15,982
Separate account liabilities	360		—		360		—		360
Line of credit with Ameriprise Financial	150		—		—		150		150
Short-term borrowings	501		—		500		—		500
Other liabilities	144		—		—		142		142

Mortgage Loans, Net

The fair value of commercial mortgage loans, except those with significant credit deterioration, is determined by discounting contractual cash flows using discount rates that reflect current pricing for loans with similar remaining maturities and characteristics including LTV ratio, occupancy rate, refinance risk, debt-service coverage, location, and property condition.  For commercial mortgage loans with significant credit deterioration, fair value is determined using the same adjustments as above with an additional adjustment for the Company’s estimate of the amount recoverable on the loan.

The fair value of residential mortgage loans is determined by discounting estimated cash flows and incorporating adjustments for prepayment, administration expenses, loss severity and credit loss estimates, with discount rates based on the Company’s estimate of current market conditions.

Given the significant unobservable inputs to the valuation of mortgage loans, these measurements are classified as Level 3.

Policy Loans

The fair value of policy loans is determined using discounted cash flows and are classified as Level 3 as the discount rate used may be adjusted for the underlying performance of individual policies.

Other Investments

Other investments primarily consist of syndicated loans and an investment in FHLB.  The fair value of syndicated loans is obtained from a third party service or non-binding broker quotes.  Syndicated loans that are priced by multiple non-binding broker quotes are classified as Level 2 and syndicated loans priced using a single non-binding broker quote are classified as Level 3.  The fair value of the investment in FHLB is approximated by the carrying value and classified as Level 3 due to restrictions on transfer or lack of liquidity.

Restricted Cash

Restricted cash is generally set aside for specific business transactions and restrictions are specific to the Company and do not transfer to third party market participants; therefore, the carrying amount is a reasonable estimate of fair value. The fair value of restricted cash is classified as Level 1.

Future Policy Benefits

The fair value of fixed annuities, in deferral status, is determined by discounting cash flows using a risk neutral discount rate with adjustments for profit margin, expense margin, early policy surrender behavior, a provision for adverse deviation from estimated early policy surrender behavior and the Company’s nonperformance risk specific to these liabilities.  The fair value of other liabilities including non-life contingent fixed annuities in payout status, EIA host contracts and the fixed portion of a small number of variable annuity contracts classified as investment contracts is determined in a similar manner.  Given the use of significant unobservable inputs to these valuations, the measurements are classified as Level 3.

Separate Account Liabilities

Certain separate account liabilities are classified as investment contracts and are carried at an amount equal to the related separate account assets.  The NAV of the related separate account assets represents the exit price for the separate account liabilities. Separate account liabilities are classified as Level 2 as they are traded in principal-to-principal markets with little publicly released pricing information. A nonperformance adjustment is not included as the related separate account assets act as collateral for these liabilities and minimize nonperformance risk.

Line of Credit with Ameriprise Financial

The fair value of the line of credit is determined by discounting cash flows with an adjustment for the Company’s nonperformance risk specific to this liability.  The fair value of the line of credit is classified as Level 3.

Short-term borrowings

The fair value of short-term borrowings is obtained from a third party pricing service. A nonperformance adjustment is not included as collateral requirements for these borrowings minimize the nonperformance risk.  The fair value of short-term borrowings is classified as Level 2.

Other Liabilities

Other liabilities consist of future funding commitments to affordable housing partnerships.  The fair value of these future funding commitments is determined by discounting cash flows and is classified as Level 3 as the discount rate is adjusted.

XML

Document and Entity Information	3 Months Ended
	Mar. 31, 2013	May 01, 2013
Document and Entity Information
Entity Registrant Name	RIVERSOURCE LIFE INSURANCE CO
Entity Central Index Key	0000727892
Document Type	10-Q
Document Period End Date	Mar. 31, 2013
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Current Reporting Status	Yes
Entity Filer Category	Non-accelerated Filer
Entity Common Stock, Shares Outstanding		100,000
Document Fiscal Year Focus	2013
Document Fiscal Period Focus	Q1

XML

Offsetting Assets and Liabilities

3 Months Ended

Mar. 31, 2013

Offsetting Assets and Liabilities

Offsetting Assets and Liabilities

11. Offsetting Assets and Liabilities

Certain financial instruments and derivative instruments are eligible for offset in the Consolidated Balance Sheets under U.S. GAAP. The Company’s derivative instruments and repurchase agreements are subject to master netting arrangements and collateral arrangements and meet the U.S. GAAP guidance to qualify for offset. A master netting arrangement with a counterparty creates a right of offset for amounts due to and from that same counterparty that is enforceable in the event of a default or bankruptcy. The Company’s policy is to recognize amounts subject to master netting arrangements on a gross basis on the Consolidated Balance Sheets.

The following tables present the gross and net information about the Company’s assets subject to master netting arrangements:

	March 31, 2013
			Gross		Amounts
	Gross		Amounts		of Assets		Gross Amounts Not Offset
	Amounts of		Offset in the		Presented in		in the Consolidated Balance Sheets
	Recognized		Consolidated		the Consolidated		Financial			Cash			Securities			Net
	Assets		Balance Sheets		Balance Sheets		Instruments(1)			Collateral			Collateral			Amount
	(in millions)
Derivatives:
OTC	$	3,056	$	—	$	3,056	$	(2,630	)	$	(150	)	$	(241	)	$	35
Exchange-traded	94		—		94		—			—			—			94
Total derivatives	$	3,150	$	—	$	3,150	$	(2,630	)	$	(150	)	$	(241	)	$	129

	December 31, 2012
			Gross		Amounts
	Gross		Amounts		of Assets		Gross Amounts Not Offset
	Amounts of		Offset in the		Presented in		in the Consolidated Balance Sheets
	Recognized		Consolidated		the Consolidated		Financial			Cash			Securities			Net
	Assets		Balance Sheets		Balance Sheets		Instruments(1)			Collateral			Collateral			Amount
	(in millions)
Derivatives:
OTC	$	3,322	$	—	$	3,322	$	(2,676	)	$	(262	)	$	(355	)	$	29
Exchange-traded	96		—		96		—			—			—			96
Total derivatives	$	3,418	$	—	$	3,418	$	(2,676	)	$	(262	)	$	(355	)	$	125

(1) Represents the amount of assets that could be offset by liabilities with the same counterparty under master netting or similar arrangements that management elects not to offset on the Consolidated Balance Sheets.

The following tables present the gross and net information about the Company’s liabilities subject to master netting arrangements:

	March 31, 2013
			Gross		Amounts
	Gross		Amounts		of Liabilities		Gross Amounts Not Offset
	Amounts of		Offset in the		Presented in		in the Consolidated Balance Sheets
	Recognized		Consolidated		the Consolidated		Financial			Cash			Securities			Net
	Liabilities		Balance Sheets		Balance Sheets		Instruments(1)			Collateral			Collateral			Amount
	(in millions)
OTC derivatives	$	3,331	$	—	$	3,331	$	(2,630	)	$	(67	)	$	(634	)	$	—
Repurchase agreements	200		—		200		—			—			(200		)	—
Total	$	3,531	$	—	$	3,531	$	(2,630	)	$	(67	)	$	(834	)	$	—

	December 31, 2012
			Gross		Amounts
	Gross		Amounts		of Liabilities		Gross Amounts Not Offset
	Amounts of		Offset in the		Presented in		in the Consolidated Balance Sheets
	Recognized		Consolidated		the Consolidated		Financial			Cash			Securities			Net
	Liabilities		Balance Sheets		Balance Sheets		Instruments(1)			Collateral			Collateral			Amount
	(in millions)
OTC derivatives	$	3,279	$	—	$	3,279	$	(2,676	)	$	(67	)	$	(532	)	$	4
Repurchase agreements	501		—		501		—			—			(501		)	—
Total	$	3,780	$	—	$	3,780	$	(2,676	)	$	(67	)	$	(1,033	)	$	4

(1) Represents the amount of liabilities that could be offset by assets with the same counterparty under master netting or similar arrangements that management elects not to offset on the Consolidated Balance Sheets.

In the tables above, the amounts of assets or liabilities presented in the Consolidated Balance Sheets are offset first by financial instruments that have the right of offset under master netting or similar arrangements, then any remaining amount is reduced by the amount of cash and securities collateral.  The actual amounts of collateral may be greater than amounts presented in the tables.

The Company’s freestanding derivative instruments are reflected in other assets and other liabilities.  Repurchase agreements are reflected in short-term borrowings.  See Note 12 for additional disclosures related to the Company’s derivative instruments and Note 9 for additional disclosures related to the Company’s repurchase agreements.

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CONSOLIDATED STATEMENTS OF INCOME (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2013	Mar. 31, 2012
Revenues
Premiums	$ 108	$ 112
Net investment income	358	377
Policy and contract charges	416	395
Other revenues	88	77
Net realized investment gains (losses)	(1)	3
Total revenues	969	964
Benefits and expenses
Benefits, claims, losses and settlement expenses	235	350
Interest credited to fixed accounts	198	206
Amortization of deferred acquisition costs	59	17
Other insurance and operating expenses	183	201
Total benefits and expenses	675	774
Pretax income	294	190
Income tax provision	54	19
Net income	240	171
Supplemental Disclosures:
Total other-than-temporary impairment losses on securities	(1)	(3)
Portion of gain recognized in other comprehensive income (before taxes)		2
Net impairment losses recognized in net realized investment gains (losses)	$ (1)	$ (1)

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Financing Receivables

3 Months Ended

Mar. 31, 2013

Financing Receivables

Financing Receivables

5. Financing Receivables

The Company’s financing receivables include commercial and residential mortgage loans, syndicated loans and policy loans.  Syndicated loans are reflected in other investments.  Policy loans do not exceed the cash surrender value of the policy at origination.  As there is minimal risk of loss related to policy loans, the Company does not record an allowance for loan losses for policy loans.

Allowance for Loan Losses

The following tables present a rollforward of the allowance for loan losses for the three months ended and the ending balance of the allowance for loan losses by impairment method and type of loan:

	March 31, 2013						March 31, 2012
	Commercial Mortgage Loans		Syndicated Loans		Total		Commercial Mortgage Loans		Syndicated Loans			Total
	(in millions)
Beginning balance	$	26	$	4	$	30	$	32	$	5		$	37
Charge-offs	—		—		—		—		(1		)	(1		)
Provisions	—		—		—		—		—			—
Ending balance	$	26	$	4	$	30	$	32	$	4		$	36
Individually evaluated for impairment	$	5	$	—	$	5	$	9	$	—		$	9
Collectively evaluated for impairment	21		4		25		23		4			27

The recorded investment in financing receivables by impairment method and type of loan was as follows:

	March 31, 2013
	Commercial Mortgage Loans		Residential Mortgage Loans		Syndicated Loans		Total
	(in millions)
Individually evaluated for impairment	$	46	$	—	$	2	$	48
Collectively evaluated for impairment	2,455		890		292		3,637
Total	$	2,501	$	890	$	294	$	3,685

	December 31, 2012
	Commercial Mortgage Loans		Residential Mortgage Loans		Syndicated Loans		Total
	(in millions)
Individually evaluated for impairment	$	39	$	—	$	—	$	39
Collectively evaluated for impairment	2,442		934		303		3,679
Total	$	2,481	$	934	$	303	$	3,718

As of March 31, 2013 and December 31, 2012, the Company’s recorded investment in financing receivables individually evaluated for impairment for which there was no related allowance for loan losses was $12 million and $10 million, respectively.

Residential mortgage loans are presented net of unamortized discount of $72 million and $80 million as of March 31, 2013 and December 31, 2012, respectively.

Purchases and sales of syndicated loans were as follows:

	Three Months Ended March 31,
	2013		2012
	(in millions)
Purchases	$	22	$	29
Sales	1		—

Credit Quality Information

Nonperforming loans, which are generally loans 90 days or more past due, were $10 million and $4 million as of March 31, 2013 and December 31, 2012, respectively.  All other loans were considered to be performing.

Commercial Mortgage Loans

The Company reviews the credit worthiness of the borrower and the performance of the underlying properties in order to determine the risk of loss on commercial mortgage loans.  Based on this review, the commercial mortgage loans are assigned an internal risk rating, which management updates as necessary. Commercial mortgage loans which management has assigned its highest risk rating were 2% of total commercial mortgage loans at both March 31, 2013 and December 31, 2012. Loans with the highest risk rating represent distressed loans which the Company has identified as impaired or expects to become delinquent or enter into foreclosure within the next six months. In addition, the Company reviews the concentrations of credit risk by region and property type.

Concentrations of credit risk of commercial mortgage loans by U.S. region were as follows:

	Loans				Percentage
	March 31, 2013		December 31, 2012		March 31, 2013		December 31, 2012
	(in millions)
South Atlantic	$	644	$	625	26	%	25	%
Pacific	575		565		23		23
Mountain	266		262		11		11
East North Central	255		255		10		10
West North Central	205		216		8		9
Middle Atlantic	196		198		8		8
West South Central	162		159		6		6
New England	130		135		5		5
East South Central	68		66		3		3
	2,501		2,481		100	%	100	%
Less: allowance for loan losses	26		26
Total	$	2,475	$	2,455

Concentrations of credit risk of commercial mortgage loans by property type were as follows:

	Loans				Percentage
	March 31, 2013		December 31, 2012		March 31, 2013		December 31, 2012
	(in millions)
Retail	$	853	$	822	34	%	33	%
Office	590		597		24		24
Industrial	439		449		18		18
Apartments	423		415		17		17
Hotel	35		36		1		1
Mixed use	33		42		1		2
Other	128		120		5		5
	2,501		2,481		100	%	100	%
Less: allowance for loan losses	26		26
Total	$	2,475	$	2,455

Residential Mortgage Loans

In October 2012, the Company purchased $954 million of residential mortgage loans at fair value from an affiliate, Ameriprise Bank, FSB.  The purchase price takes into account the credit quality of the loan portfolio resulting in no allowance for loan losses recorded at purchase. The Company considers the credit worthiness of borrowers (FICO score), collateral characteristics such as loan-to-value (“LTV”) and geographic concentration to determine when an amount for an allowance for loan losses for residential mortgage loans is appropriate.  At a minimum, management updates FICO scores and LTV ratios semiannually.  As of March 31, 2013 and December 31, 2012, no allowance for loan losses was recorded.

As of March 31, 2013 and December 31, 2012, approximately 4% and 3%, respectively, of residential mortgage loans had FICO scores below 640.  At March 31, 2013 and December 31, 2012, approximately 1% and 7%, respectively, of the Company’s residential mortgage loans had LTV ratios greater than 90%.  The Company’s most significant geographic concentration for residential mortgage loans is in California representing 38% of the portfolio as of both March 31, 2013 and December 31, 2012.  No other state represents more than 10% of the total residential mortgage loan portfolio.

Syndicated Loans

The Company’s syndicated loan portfolio is diversified across industries and issuers.  The primary credit indicator for syndicated loans is whether the loans are performing in accordance with the contractual terms of the syndication. Total nonperforming syndicated loans at both March 31, 2013 and December 31, 2012 were $2 million.

Troubled Debt Restructurings

The following table presents the number of loans restructured by the Company during the three months ended March 31 and their recorded investment at March 31:

	2013			2012
	Number of Loans	Recorded Investment		Number of Loans	Recorded Investment
	(in millions, except number of loans)
Residential mortgage loans	2	$	—	—	$	—
Syndicated loans	—	—		1	1
Total	2	$	—	1	$	1

The troubled debt restructurings did not have a material impact to the Company’s allowance for loan losses or income recognized for the three months ended March 31, 2013 and 2012. There are no material commitments to lend additional funds to borrowers whose loans have been restructured.

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Investments

3 Months Ended

Mar. 31, 2013

Investments.

Investments

4. Investments

Available-for-Sale securities distributed by type were as follows:

	March 31, 2013
Description of Securities	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value		Noncredit OTTI(1)
	(in millions)
Fixed maturities:
Corporate debt securities	$	14,725	$	2,005	$	(10	)	$	16,720	$	2
Residential mortgage backed securities	3,419		210		(52		)	3,577		(21		)
Commercial mortgage backed securities	2,578		248		(1		)	2,825		—
State and municipal obligations	967		178		(28		)	1,117		—
Asset backed securities	797		72		(2		)	867		—
Foreign government bonds and obligations	184		30		—			214		—
U.S. government and agencies obligations	41		7		—			48		—
Total fixed maturities	22,711		2,750		(93		)	25,368		(19		)
Common stocks	2		2		—			4		1
Total	$	22,713	$	2,752	$	(93	)	$	25,372	$	(18	)

	December 31, 2012
Description of Securities	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value		Noncredit OTTI(1)
	(in millions)
Fixed maturities:
Corporate debt securities	$	14,881	$	2,167	$	(7	)	$	17,041	$	—
Residential mortgage backed securities	3,446		233		(58		)	3,621		(24		)
Commercial mortgage backed securities	2,717		287		—			3,004		—
State and municipal obligations	976		180		(34		)	1,122		—
Asset backed securities	808		66		(3		)	871		—
Foreign government bonds and obligations	188		36		—			224		—
U.S. government and agencies obligations	42		7		—			49		—
Total fixed maturities	23,058		2,976		(102		)	25,932		(24		)
Common stocks	2		2		—			4		1
Total	$	23,060	$	2,978	$	(102	)	$	25,936	$	(23	)

(1) Represents the amount of other-than-temporary impairment (“OTTI”) losses in accumulated other comprehensive income.  Amount includes unrealized gains and losses on impaired securities subsequent to the initial impairment measurement date.  These amounts are included in gross unrealized gains and losses as of the end of the period.

At both March 31, 2013 and December 31, 2012, fixed maturity securities comprised approximately 84% of the Company’s total investments.  Rating agency designations are based on the availability of ratings from Nationally Recognized Statistical Rating Organizations (“NRSROs”), including Moody’s Investors Service (“Moody’s”), Standard & Poor’s Ratings Services (“S&P”) and Fitch Ratings Ltd. (“Fitch”).  The Company uses the median of available ratings from Moody’s, S&P and Fitch, or if fewer than three ratings are available, the lower rating is used. When ratings from Moody’s, S&P and Fitch are unavailable, the Company may utilize ratings from other NRSROs or rate the securities internally. At March 31, 2013 and December 31, 2012, approximately $1.4 billion and $1.5 billion, respectively, of securities were internally rated by Columbia Management Investment Advisers, LLC using criteria similar to those used by NRSROs.

A summary of fixed maturity securities by rating was as follows:

	March 31, 2013						December 31, 2012
Ratings	Amortized Cost		FairValue		Percent of Total Fair Value		Amortized Cost		FairValue		Percent of Total Fair Value
	(in millions, except percentages)
AAA	$	5,405	$	5,846	23	%	$	5,680	$	6,198	24	%
AA	1,173		1,381		5		1,102		1,273		5
A	4,338		4,944		20		4,262		4,849		19
BBB	10,269		11,670		46		10,409		12,019		46
Below investment grade	1,526		1,527		6		1,605		1,593		6
Total fixed maturities	$	22,711	$	25,368	100	%	$	23,058	$	25,932	100	%

At March 31, 2013 and December 31, 2012, approximately 34% and 32%, respectively, of the securities rated AAA were GNMA, FNMA and FHLMC mortgage backed securities.  No holdings of any other issuer were greater than 10% of total equity.

The following tables provide information about Available-for-Sale securities with gross unrealized losses and the length of time that individual securities have been in a continuous unrealized loss position:

	March 31, 2013
	Less than 12 months						12 months or more						Total
Description of Securities	Number of Securities	Fair Value		Unrealized Losses			Number of Securities	Fair Value		Unrealized Losses			Number of Securities	Fair Value		Unrealized Losses
	(in millions, except number of securities)
Corporate debt securities	50	$	546	$	(7	)	5	$	49	$	(3	)	55	$	595	$	(10	)
Residential mortgage backed securities	16	320		(5		)	51	250		(47		)	67	570		(52		)
State and municipal obligations	—	—		—			2	105		(28		)	2	105		(28		)
Asset backed securities	2	12		—			4	59		(2		)	6	71		(2		)
Commercial mortgage backed securities	6	48		(1		)	—	—		—			6	48		(1		)
Total	74	$	926	$	(13	)	62	$	463	$	(80	)	136	$	1,389	$	(93	)

	December 31, 2012
	Less than 12 months						12 months or more						Total
Description of Securities	Number of Securities	Fair Value		Unrealized Losses			Number of Securities	Fair Value		Unrealized Losses			Number of Securities	Fair Value		Unrealized Losses
	(in millions, except number of securities)
Corporate debt securities	50	$	477	$	(4	)	6	$	70	$	(3	)	56	$	547	$	(7	)
Residential mortgage backed securities	6	107		—			56	293		(58		)	62	400		(58		)
State and municipal obligations	—	—		—			2	100		(34		)	2	100		(34		)
Asset backed securities	1	10		—			5	86		(3		)	6	96		(3		)
Total	57	$	594	$	(4	)	69	$	549	$	(98	)	126	$	1,143	$	(102	)

As part of the Company’s ongoing monitoring process, management determined that a majority of the gross unrealized losses on its Available-for-Sale securities are attributable to movement in credit spreads primarily related to non-agency residential mortgage backed securities purchased prior to 2008.

The following table presents a rollforward of the cumulative amounts recognized in the Consolidated Statements of Income for other-than-temporary impairments related to credit losses on securities for which a portion of the securities’ total other-than-temporary impairments was recognized in other comprehensive income:

	Three Months Ended March 31,
	2013			2012
	(in millions)
Beginning balance	$	87		$	106
Credit losses for which an other-than-temporary impairment was previously recognized	1			1
Reductions for securities sold during the period (realized)	(13		)	(2		)
Ending balance	$	75		$	105

The change in net unrealized securities gains (losses) in other comprehensive income includes three components, net of tax: (i) unrealized gains (losses) that arose from changes in the market value of securities that were held during the period; (ii) (gains) losses that were previously unrealized, but have been recognized in current period net income due to sales of Available-for-Sale securities and due to the reclassification of noncredit other-than-temporary impairment losses to credit losses and (iii) other items primarily consisting of adjustments in asset and liability balances, such as DAC, deferred sales inducement costs (“DSIC”), benefit reserves and reinsurance recoverables, to reflect the expected impact on their carrying values had the unrealized gains (losses) been realized as of the respective balance sheet dates.

The following table presents a rollforward of the net unrealized securities gains on Available-for-Sale securities included in accumulated other comprehensive income:

	NetUnrealizedSecuritiesGains			DeferredIncome Tax			Accumulated OtherComprehensive Income Related to Net Unrealized Securities Gains
	(in millions)
Balance at January 1, 2012	$	1,472		$	(515	)	$	957
Net unrealized securities gains arising during the period(1)	65			(23		)	42
Reclassification of net securities gains included in net income	(3		)	1			(2		)
Impact on DAC, DSIC, benefit reserves and reinsurance recoverables	(5		)	2			(3		)
Balance at March 31, 2012	$	1,529		$	(535	)	$	994	(2)
Balance at January 1, 2013	$	1,930		$	(675	)	$	1,255
Net unrealized securities losses arising during the period(1)	(217		)	76			(141		)
Reclassification of net securities losses included in net income	1			(1		)	—
Impact on DAC, DSIC, benefit reserves and reinsurance recoverables	98			(34		)	64
Balance at March 31, 2013	$	1,812		$	(634	)	$	1,178	(2)

(1) Includes other-than-temporary impairment losses on Available-for-Sale securities related to factors other than credit that were recognized in other comprehensive income during the period.

(2) Includes $(12) million and $(18) million of noncredit related impairments on securities and net unrealized securities losses on previously impaired securities at March 31, 2013 and 2012, respectively.

Net realized gains and losses on Available-for-Sale securities, determined using the specific identification method, recognized in net realized investment gains (losses) were as follows:

	Three Months Ended March 31,
	2013			2012
	(in millions)
Gross realized investment gains	$	—		$	4
Other-than-temporary impairments	(1		)	(1		)
Total	$	(1	)	$	3

Other-than-temporary impairments for the three months ended March 31, 2013 and 2012 primarily related to credit losses on non-agency residential mortgage backed securities.

Available-for-Sale securities by contractual maturity at March 31, 2013 were as follows:

	Amortized Cost		Fair Value
	(in millions)
Due within one year	$	1,547	$	1,581
Due after one year through five years	4,099		4,437
Due after five years through 10 years	6,716		7,627
Due after 10 years	3,555		4,454
	15,917		18,099
Residential mortgage backed securities	3,419		3,577
Commercial mortgage backed securities	2,578		2,825
Asset backed securities	797		867
Common stocks	2		4
Total	$	22,713	$	25,372

Actual maturities may differ from contractual maturities because issuers may have the right to call or prepay obligations.  Residential mortgage backed securities, commercial mortgage backed securities and asset backed securities are not due at a single maturity date.  As such, these securities, as well as common stocks, were not included in the maturities distribution.

Net investment income is summarized as follows:

	Three Months Ended March 31,
	2013		2012
	(in millions)
Income on fixed maturities	$	309	$	342
Income on mortgage loans	51		35
Other investments	6		6
	366		383
Less: investment expenses	8		6
Total	$	358	$	377

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Investments (Tables)

3 Months Ended

Mar. 31, 2013

Investments.

Schedule of available-for-sale securities distributed by type

	March 31, 2013
Description of Securities	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value		Noncredit OTTI(1)
	(in millions)
Fixed maturities:
Corporate debt securities	$	14,725	$	2,005	$	(10	)	$	16,720	$	2
Residential mortgage backed securities	3,419		210		(52		)	3,577		(21		)
Commercial mortgage backed securities	2,578		248		(1		)	2,825		—
State and municipal obligations	967		178		(28		)	1,117		—
Asset backed securities	797		72		(2		)	867		—
Foreign government bonds and obligations	184		30		—			214		—
U.S. government and agencies obligations	41		7		—			48		—
Total fixed maturities	22,711		2,750		(93		)	25,368		(19		)
Common stocks	2		2		—			4		1
Total	$	22,713	$	2,752	$	(93	)	$	25,372	$	(18	)

	December 31, 2012
Description of Securities	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value		Noncredit OTTI(1)
	(in millions)
Fixed maturities:
Corporate debt securities	$	14,881	$	2,167	$	(7	)	$	17,041	$	—
Residential mortgage backed securities	3,446		233		(58		)	3,621		(24		)
Commercial mortgage backed securities	2,717		287		—			3,004		—
State and municipal obligations	976		180		(34		)	1,122		—
Asset backed securities	808		66		(3		)	871		—
Foreign government bonds and obligations	188		36		—			224		—
U.S. government and agencies obligations	42		7		—			49		—
Total fixed maturities	23,058		2,976		(102		)	25,932		(24		)
Common stocks	2		2		—			4		1
Total	$	23,060	$	2,978	$	(102	)	$	25,936	$	(23	)

(1) Represents the amount of other-than-temporary impairment (“OTTI”) losses in accumulated other comprehensive income.  Amount includes unrealized gains and losses on impaired securities subsequent to the initial impairment measurement date.  These amounts are included in gross unrealized gains and losses as of the end of the period.

Schedule of fixed maturity securities by rating

	March 31, 2013						December 31, 2012
Ratings	Amortized Cost		FairValue		Percent of Total Fair Value		Amortized Cost		FairValue		Percent of Total Fair Value
	(in millions, except percentages)
AAA	$	5,405	$	5,846	23	%	$	5,680	$	6,198	24	%
AA	1,173		1,381		5		1,102		1,273		5
A	4,338		4,944		20		4,262		4,849		19
BBB	10,269		11,670		46		10,409		12,019		46
Below investment grade	1,526		1,527		6		1,605		1,593		6
Total fixed maturities	$	22,711	$	25,368	100	%	$	23,058	$	25,932	100	%

Schedule of available-for-sale securities with gross unrealized losses and the length of time that individual securities have been in a continuous unrealized loss position

	March 31, 2013
	Less than 12 months						12 months or more						Total
Description of Securities	Number of Securities	Fair Value		Unrealized Losses			Number of Securities	Fair Value		Unrealized Losses			Number of Securities	Fair Value		Unrealized Losses
	(in millions, except number of securities)
Corporate debt securities	50	$	546	$	(7	)	5	$	49	$	(3	)	55	$	595	$	(10	)
Residential mortgage backed securities	16	320		(5		)	51	250		(47		)	67	570		(52		)
State and municipal obligations	—	—		—			2	105		(28		)	2	105		(28		)
Asset backed securities	2	12		—			4	59		(2		)	6	71		(2		)
Commercial mortgage backed securities	6	48		(1		)	—	—		—			6	48		(1		)
Total	74	$	926	$	(13	)	62	$	463	$	(80	)	136	$	1,389	$	(93	)

	December 31, 2012
	Less than 12 months						12 months or more						Total
Description of Securities	Number of Securities	Fair Value		Unrealized Losses			Number of Securities	Fair Value		Unrealized Losses			Number of Securities	Fair Value		Unrealized Losses
	(in millions, except number of securities)
Corporate debt securities	50	$	477	$	(4	)	6	$	70	$	(3	)	56	$	547	$	(7	)
Residential mortgage backed securities	6	107		—			56	293		(58		)	62	400		(58		)
State and municipal obligations	—	—		—			2	100		(34		)	2	100		(34		)
Asset backed securities	1	10		—			5	86		(3		)	6	96		(3		)
Total	57	$	594	$	(4	)	69	$	549	$	(98	)	126	$	1,143	$	(102	)

Schedule of rollforward of the cumulative amounts recognized in the consolidated statements of income for other-than-temporary impairments related to credit losses

	Three Months Ended March 31,
	2013			2012
	(in millions)
Beginning balance	$	87		$	106
Credit losses for which an other-than-temporary impairment was previously recognized	1			1
Reductions for securities sold during the period (realized)	(13		)	(2		)
Ending balance	$	75		$	105

Other Comprehensive Income Available-for-Sale Securities Disclosure

	NetUnrealizedSecuritiesGains			DeferredIncome Tax			Accumulated OtherComprehensive Income Related to Net Unrealized Securities Gains
	(in millions)
Balance at January 1, 2012	$	1,472		$	(515	)	$	957
Net unrealized securities gains arising during the period(1)	65			(23		)	42
Reclassification of net securities gains included in net income	(3		)	1			(2		)
Impact on DAC, DSIC, benefit reserves and reinsurance recoverables	(5		)	2			(3		)
Balance at March 31, 2012	$	1,529		$	(535	)	$	994	(2)
Balance at January 1, 2013	$	1,930		$	(675	)	$	1,255
Net unrealized securities losses arising during the period(1)	(217		)	76			(141		)
Reclassification of net securities losses included in net income	1			(1		)	—
Impact on DAC, DSIC, benefit reserves and reinsurance recoverables	98			(34		)	64
Balance at March 31, 2013	$	1,812		$	(634	)	$	1,178	(2)

(1) Includes other-than-temporary impairment losses on Available-for-Sale securities related to factors other than credit that were recognized in other comprehensive income during the period.

(2) Includes $(12) million and $(18) million of noncredit related impairments on securities and net unrealized securities losses on previously impaired securities at March 31, 2013 and 2012, respectively.

Schedule of net realized gains and losses on available-for-sale securities

	Three Months Ended March 31,
	2013			2012
	(in millions)
Gross realized investment gains	$	—		$	4
Other-than-temporary impairments	(1		)	(1		)
Total	$	(1	)	$	3

Schedule of available-for-sale securities by contractual maturity

	Amortized Cost		Fair Value
	(in millions)
Due within one year	$	1,547	$	1,581
Due after one year through five years	4,099		4,437
Due after five years through 10 years	6,716		7,627
Due after 10 years	3,555		4,454
	15,917		18,099
Residential mortgage backed securities	3,419		3,577
Commercial mortgage backed securities	2,578		2,825
Asset backed securities	797		867
Common stocks	2		4
Total	$	22,713	$	25,372

Schedule of net investment income

	Three Months Ended March 31,
	2013		2012
	(in millions)
Income on fixed maturities	$	309	$	342
Income on mortgage loans	51		35
Other investments	6		6
	366		383
Less: investment expenses	8		6
Total	$	358	$	377

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Derivatives and Hedging Activities

3 Months Ended

Mar. 31, 2013

Derivatives and Hedging Activities

Derivatives and Hedging Activities

12. Derivatives and Hedging Activities

Derivative instruments enable the Company to manage its exposure to various market risks.  The value of such instruments is derived from an underlying variable or multiple variables, including equity and interest rate indices or prices.  The Company primarily enters into derivative agreements for risk management purposes related to the Company’s products and operations.

The Company’s freestanding derivatives are recorded at fair value and are reflected in other assets or other liabilities. The Company’s freestanding derivative instruments are all subject to master netting arrangements. The Company’s policy on the recognition of derivatives on the Consolidated Balance Sheets is to not offset fair value amounts recognized for derivatives and collateral arrangements executed with the same counterparty under the same master netting arrangement. See Note 11 for additional information regarding the estimated fair value of the Company’s freestanding derivatives after considering the effect of master netting arrangements and collateral.

In April 2012, the Financial Stability Oversight Council approved the final rule and interpretive guidance that provides the framework it will follow to determine if a nonbank financial company is a Systemically Important Financial Institution. The framework includes a three-stage process to help narrow down the pool of nonbank financial companies for review and possible designation. Stage 1 criteria include having at least $50 billion in assets and meeting one of five additional quantitative measures. One of the five thresholds is $3.5 billion of derivative liabilities after considering the effects of master netting arrangements and cash collateral held with the same counterparty. The following table presents the Company’s derivative liabilities as defined by the rule:

	March 31, 2013		December 31, 2012
	(in millions)
Fair value of OTC derivative liabilities after application of master netting agreements and cash collateral	$	634	$	536
Fair value of embedded derivative liabilities	330		880
Fair value of derivative liabilities after application of master netting agreements and cash collateral	$	964	$	1,416

The Company currently uses derivatives as economic hedges and accounting hedges.  The following table presents the balance sheet location and the gross fair value of derivative instruments, including embedded derivatives:

		Asset					Liability
Derivatives not designated as hedging instruments	Balance Sheet Location	March 31, 2013		December 31, 2012		Balance Sheet Location	March 31, 2013		December 31, 2012
		(in millions)					(in millions)
GMWB and GMAB
Interest rate contracts	Other assets	$	1,937	$	2,191	Other liabilities	$	1,421	$	1,486
Equity contracts	Other assets	1,192		1,215		Other liabilities	1,904		1,792
Foreign currency contracts	Other assets	7		6		Other liabilities	1		—
Embedded derivatives(1)	Not applicable	—		—		Future policy benefits	266		833
Total GMWB and GMAB		3,136		3,412			3,592		4,111
Other derivatives:
Equity
EIA embedded derivatives	Not applicable	—		—		Future policy benefits	3		2
IUL	Other assets	14		6		Other liabilities	5		1
IUL embedded derivatives	Not applicable	—		—		Future policy benefits	61		45
Total other		14		6			69		48
Total derivatives		$	3,150	$	3,418		$	3,661	$	4,159

(1) The fair values of GMWB and GMAB embedded derivatives fluctuate based on changes in equity, interest rate and credit markets.

See Note 10 for additional information regarding the Company’s fair value measurement of derivative instruments.

The following table presents a summary of the impact of derivatives not designated as hedging instruments on the Consolidated Statements of Income for the three months ended March 31:

		Amount of Gain (Loss) on Derivatives
Derivatives not designated	Location of Gain (Loss) on	Recognized in Income
as hedging instruments	Derivatives Recognized in Income	2013			2012
		(in millions)
GMWB and GMAB
Interest rate contracts	Benefits, claims, losses and settlement expenses	$	(132	)	$	(225	)
Equity contracts	Benefits, claims, losses and settlement expenses	(492		)	(695		)
Credit contracts	Benefits, claims, losses and settlement expenses	—			(3		)
Foreign currency contracts	Benefits, claims, losses and settlement expenses	5			4
Embedded derivatives(1)	Benefits, claims, losses and settlement expenses	567			745
Total GMWB and GMAB		(52		)	(174		)
Other derivatives:
Equity
EIA	Interest credited to fixed accounts	1			1
EIA embedded derivatives	Interest credited to fixed accounts	(1		)	—
IUL	Interest credited to fixed accounts	4			—
IUL embedded derivatives	Interest credited to fixed accounts	3			—
Total other		7			1
Total derivatives		$	(45	)	$	(173	)

(1) The fair values of GMWB and GMAB embedded derivatives fluctuate based on changes in equity, interest rate and credit markets.

The Company holds derivative instruments that either do not qualify or are not designated for hedge accounting treatment.  These derivative instruments are used as economic hedges of equity, interest rate and credit risk related to various products and transactions of the Company.

Certain annuity contracts contain GMWB or GMAB provisions, which guarantee the right to make limited partial withdrawals each contract year regardless of the volatility inherent in the underlying investments or guarantee a minimum accumulation value of consideration received at the beginning of the contract period, after a specified holding period, respectively.  The Company economically hedges the exposure related to non-life contingent GMWB and GMAB provisions primarily using various futures, options, interest rate swaptions, interest rate swaps, total return swaps, variance swaps and credit default swaps.  At March 31, 2013 and December 31, 2012, the gross notional amount of derivative contracts for the Company’s GMWB and GMAB provisions was $146.1 billion and $142.1 billion, respectively.

The deferred premium associated with certain of the above options is paid or received semi-annually over the life of the option contract.  The following is a summary of the payments the Company is scheduled to make and receive for these options:

	Premiums Payable		Premiums Receivable
	(in millions)
2013(1)	$	287	$	47
2014	344		54
2015	317		53
2016	287		46
2017	237		40
2018-2027	780		104

(1)   2013 amounts represent the amounts payable and receivable for the period from April 1, 2013 to December 31, 2013.

Actual timing and payment amounts may differ due to future contract settlements, modifications or exercises of options prior to the full premium being paid or received.

EIA and IUL products have returns tied to the performance of equity markets.  As a result of fluctuations in equity markets, the obligation incurred by the Company related to EIA and IUL products will positively or negatively impact earnings over the life of these products.  As a means of economically hedging its obligations under the provisions of these products, the Company enters into index options and futures contracts.  The gross notional amount of EIA derivative contracts was $12 million and $10 million at March 31, 2013 and December 31, 2012, respectively. The gross notional amount of IUL derivative contracts was $255 million and $200 million at March 31, 2013 and December 31, 2012, respectively.

Embedded Derivatives

Certain annuities contain GMAB and non-life contingent GMWB provisions, which are considered embedded derivatives.  In addition, the equity component of the EIA and IUL product obligations are also considered embedded derivatives.  These embedded derivatives are bifurcated from their host contracts and reported on the Consolidated Balance Sheets at fair value with changes in fair value reported in earnings.  As discussed above, the Company uses derivatives to mitigate the financial statement impact of these embedded derivatives.

Cash Flow Hedges

The Company has amounts classified in AOCI related to gains and losses associated with the effective portion of previously designated cash flow hedges.  The Company reclassifies these amounts into income as the forecasted transactions impact earnings.  During the three months ended March 31, 2013, the Company held no derivatives that were designated as cash flow hedges.

At March 31, 2013, the Company expects to reclassify $6 million of deferred loss on derivative instruments from AOCI to earnings during the next 12 months that will be recorded in net investment income.  These were originally losses on derivative instruments related to interest rate swaptions.  During the three months ended March 31, 2013 and 2012, no hedge relationships were discontinued due to forecasted transactions no longer being expected to occur according to the original hedge strategy.  For the three months ended March 31, 2013 and 2012, amounts recognized in earnings on derivative transactions that were ineffective were not material.

The following table presents a rollforward of unrealized derivative losses related to cash flow hedges included in accumulated other comprehensive income:

	2013			2012
	(in millions)
Net unrealized derivative losses at January 1	$	(21	)	$	(26	)
Reclassification of realized losses(1)	2			2
Income tax benefit	(1		)	(1		)
Net unrealized derivative losses at March 31	$	(20	)	$	(25	)

(1) Loss reclassified from AOCI to net investment income on the Consolidated Statements of Income.

Currently, the longest period of time over which the Company is hedging exposure to the variability in future cash flows is six years and relates to interest credited on forecasted fixed premium product sales.

Credit Risk

Credit risk associated with the Company’s derivatives is the risk that a derivative counterparty will not perform in accordance with the terms of the applicable derivative contract.  To mitigate such risk, the Company has established guidelines and oversight of credit risk through a comprehensive enterprise risk management program that includes members of senior management.  Key components of this program are to require preapproval of counterparties and the use of master netting arrangements and collateral arrangements whenever practical.  See Note 11 for additional information on the Company’s credit exposure related to derivative assets.

Certain of the Company’s derivative contracts contain provisions that adjust the level of collateral the Company is required to post based on the Company’s financial strength rating (or based on the debt rating of the Company’s parent, Ameriprise Financial).  Additionally, certain of the Company’s derivative contracts contain provisions that allow the counterparty to terminate the contract if the Company does not maintain a specific financial strength rating or Ameriprise Financial’s debt does not maintain a specific credit rating (generally an investment grade rating).  If these termination provisions were to be triggered, the Company’s counterparty could require immediate settlement of any net liability position.  At March 31, 2013 and December 31, 2012, the aggregate fair value of derivative contracts in a net liability position containing such credit contingent provisions was $448 million and $364 million, respectively.  The aggregate fair value of assets posted as collateral for such instruments as of March 31, 2013 and December 31, 2012 was $448 million and $360 million, respectively.  If the credit contingent provisions of derivative contracts in a net liability position at March 31, 2013 and December 31, 2012 were triggered, the aggregate fair value of additional assets that would be required to be posted as collateral or needed to settle the instruments immediately would have been nil and $4 million, respectively.

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Variable Annuity and Insurance Guarantees

3 Months Ended

Mar. 31, 2013

Variable Annuity and Insurance Guarantees

Variable Annuity and Insurance Guarantees

8. Variable Annuity and Insurance Guarantees

The majority of the variable annuity contracts offered by the Company contain guaranteed minimum death benefit (“GMDB”) provisions.  The Company also offers variable annuities with death benefit provisions that gross up the amount payable by a certain percentage of contract earnings, which are referred to as gain gross-up (“GGU”) benefits.  In addition, the Company offers contracts with GMWB and GMAB provisions.  The Company previously offered contracts containing guaranteed minimum income benefit (“GMIB”) provisions.

Certain UL policies offered by the Company provide secondary guarantee benefits.  The secondary guarantee ensures that, subject to specified conditions, the policy will not terminate and will continue to provide a death benefit even if there is insufficient policy value to cover the monthly deductions and charges.

The following table provides information related to variable annuity guarantees for which the Company has established additional liabilities:

	March 31, 2013							December 31, 2012
Variable Annuity Guarantees by Benefit Type (1)	Total Contract Value		Contract Value in Separate Accounts		Net Amount at Risk(2)		Weighted Average Attained Age	Total Contract Value		Contract Value in Separate Accounts		Net Amount at Risk(2)		Weighted Average Attained Age
	(in millions, except age)
GMDB:
Return of premium	$	48,049	$	46,289	$	41	63	$	45,697	$	43,942	$	61	63
Five/six-year reset	11,382		8,874		78		63	11,233		8,722		115		63
One-year ratchet	7,552		7,126		61		65	7,367		6,933		106		65
Five-year ratchet	1,681		1,627		2		61	1,616		1,563		3		61
Other	978		952		48		68	912		885		62		68
Total — GMDB	$	69,642	$	64,868	$	230	63	$	66,825	$	62,045	$	347	63
GGU death benefit	$	990	$	939	$	104	63	$	958	$	907	$	93	63
GMIB	$	432	$	406	$	56	66	$	425	$	399	$	72	66
GMWB:
GMWB	$	3,980	$	3,962	$	15	66	$	3,898	$	3,880	$	34	66
GMWB for life	30,330		30,199		140		65	28,588		28,462		263		64
Total — GMWB	$	34,310	$	34,161	$	155	65	$	32,486	$	32,342	$	297	64
GMAB	$	3,936	$	3,924	$	2	57	$	3,773	$	3,762	$	5	57

(1) Individual variable annuity contracts may have more than one guarantee and therefore may be included in more than one benefit type.  Variable annuity contracts for which the death benefit equals the account value are not shown in this table.

(2) Represents the current guaranteed benefit amount in excess of the current contract value.  GMIB, GMWB and GMAB benefits are subject to waiting periods and payment periods specified in the contract.

Changes in additional liabilities for variable annuity and insurance guarantees were as follows:

	GMDB & GGU			GMIB			GMWB			GMAB			UL
	(in millions)
Balance at January 1, 2012	$	5		$	9		$	1,377		$	237		$	111
Incurred claims	—			(2		)	(624		)	(119		)	17
Paid claims	(2		)	—			—			—			(4		)
Balance at March 31, 2012	$	3		$	7		$	753		$	118		$	124
Balance at January 1, 2013	$	4		$	9		$	799		$	103		$	155
Incurred claims	1			—			(480		)	(80		)	17
Paid claims	(1		)	—			—			—			(3		)
Balance at March 31, 2013	$	4		$	9		$	319		$	23		$	169

The liabilities for guaranteed benefits are supported by general account assets.

The following table summarizes the distribution of separate account balances by asset type for variable annuity contracts providing guaranteed benefits:

	March 31,		December 31,
	2013		2012
	(in millions)
Mutual funds:
Equity	$	33,375	$	32,054
Bond	26,477		26,165
Other	4,209		3,991
Total mutual funds	$	64,061	$	62,210

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Derivatives and Hedging Activities (Details 5) (USD $) In Millions, unless otherwise specified	Mar. 31, 2013	Dec. 31, 2012
Derivatives liabilities, credit risk related contingent features
Aggregate fair value of all derivative instruments in a net liability position containing such credit risk features	$ 448	$ 364
Aggregate fair value of assets posted as collateral	448	360
Additional fair value of assets needed to settle derivative liabilities	$ 0	$ 4

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Deferred Acquisition Costs and Deferred Sales Inducement Costs

3 Months Ended

Mar. 31, 2013

Deferred Acquisition Costs and Deferred Sales Inducement Costs

Deferred Acquisition Costs and Deferred Sales Inducement Costs

6. Deferred Acquisition Costs and Deferred Sales Inducement Costs

The balances of and changes in DAC were as follows:

	2013			2012
	(in millions)
Balance at January 1	$	2,373		$	2,413
Capitalization of acquisition costs	62			67
Amortization	(59		)	(17		)
Impact of change in net unrealized securities losses (gains)	33			(19		)
Balance at March 31	$	2,409		$	2,444

The balances of and changes in DSIC were as follows:

	2013			2012
	(in millions)
Balance at January 1	$	404		$	464
Capitalization of sales inducement costs	2			2
Amortization	(12		)	(2		)
Impact of change in net unrealized securities losses (gains)	3			(4		)
Balance at March 31	$	397		$	460

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Future Policy Benefits, Policy Claims and Other Policyholders' Funds and Separate Account Liabilities

3 Months Ended

Mar. 31, 2013

Future Policy Benefits, Policy Claims and Other Policyholders' Funds and Separate Account Liabilities

Future Policy Benefits, Policy Claims and Other Policyholders' Funds and Separate Account Liabilities

7. Future Policy Benefits, Policy Claims and Other Policyholders’ Funds and Separate Account Liabilities

Future policy benefits and policy claims and other policyholders’ funds consisted of the following:

	March 31, 2013		December 31, 2012
	(in millions)
Fixed annuities	$	15,905	$	16,075
Equity indexed annuity (“EIA”) accumulated host values	29		31
EIA embedded derivatives	3		2
Variable annuity fixed sub-accounts	4,832		4,843
Variable annuity guaranteed minimum withdrawal benefits (“GMWB”)	319		799
Variable annuity guaranteed minimum accumulation benefits (“GMAB”)	23		103
Other variable annuity guarantees	13		13
Total annuities	21,124		21,866
Variable universal life (“VUL”)/universal life (“UL”) insurance	2,767		2,760
Indexed universal life (“IUL”) accumulated host values	74		59
IUL embedded derivatives	61		45
VUL/UL insurance additional liabilities	296		294
Other life, disability income and long term care insurance	5,657		5,646
Total future policy benefits	29,979		30,670
Policy claims and other policyholders’ funds	145		132
Total future policy benefits and policy claims and other policyholders’ funds	$	30,124	$	30,802

Separate account liabilities consisted of the following:

	March 31, 2013		December 31, 2012
	(in millions)
Variable annuity variable sub-accounts	$	66,121	$	63,302
VUL insurance variable sub-accounts	6,368		6,051
Other insurance variable sub-accounts	43		42
Total	$	72,532	$	69,395

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Short-term Borrowings

3 Months Ended

Mar. 31, 2013

Short-term Borrowings

Short-term Borrowings

9. Short-term Borrowings

The Company enters into repurchase agreements in exchange for cash which it accounts for as secured borrowings.  The Company has pledged Available-for-Sale securities consisting of agency residential mortgage backed securities and commercial mortgage backed securities to collateralize its obligation under the repurchase agreements. The fair value of the securities pledged is recorded in investments and was $208 million and $518 million at March 31, 2013 and December 31, 2012, respectively. The amount of the Company’s liability including accrued interest as of March 31, 2013 and December 31, 2012 was $200 million and $501 million, respectively.  The weighted average annualized interest rate on the repurchase agreements held as of both March 31, 2013 and December 31, 2012 was 0.4%.

RiverSource Life Insurance Company is a member of the Federal Home Loan Bank (“FHLB”) of Des Moines which provides access to collateralized borrowings. The Company has pledged Available-for-Sale securities consisting of commercial mortgage backed securities to collateralize its obligation under these borrowings. The fair value of the securities pledged is recorded in investments and was $389 million at March 31, 2013. The amount of the Company’s liability including accrued interest as of March 31, 2013 was $300 million.  The weighted average annualized interest rate on the FHLB advances held as of March 31, 2013 was 0.3%.

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Contingencies and Guarantees (Details) (Future guaranty fund assessments, USD $) In Millions, unless otherwise specified	3 Months Ended	12 Months Ended
	Mar. 31, 2013	Dec. 31, 2012
Future guaranty fund assessments
Commitments and Contingencies
Liability related to guaranty fund assessments	$ 26	$ 26
Premium tax asset	$ 19	$ 19

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Variable Interest Entities (Details) (Variable interests in affordable housing partnerships, RTA, USD $) In Millions, unless otherwise specified	Mar. 31, 2013	Dec. 31, 2012
Variable interests in affordable housing partnerships | RTA
Variable Interest Entities
Carrying values of investments reflected in other investments	$ 410	$ 409
Obligation to provide financial or other support to the affordable housing partnerships	0
Liabilities related to the future funding commitments recorded in other liabilities	$ 123	$ 144

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Fair Values of Assets and Liabilities (Details 2) (USD $) In Millions, unless otherwise specified	3 Months Ended											3 Months Ended
	Mar. 31, 2013	Mar. 31, 2012	Mar. 31, 2013 GMWB and GMAB Embedded Derivatives	Mar. 31, 2012 GMWB and GMAB Embedded Derivatives	Mar. 31, 2013 Corporate Debt Securities	Mar. 31, 2012 Corporate Debt Securities	Mar. 31, 2013 Residential Mortgage Backed Securities	Mar. 31, 2012 Residential Mortgage Backed Securities	Mar. 31, 2013 Commercial Mortgage Backed Securities	Mar. 31, 2012 Commercial Mortgage Backed Securities	Dec. 31, 2011 Commercial Mortgage Backed Securities	Mar. 31, 2013 Asset Backed Securities	Mar. 31, 2012 Asset Backed Securities	Mar. 31, 2012 Other Structured Investments	Mar. 31, 2013 Available-for-Sale Securities: Fixed Maturities	Mar. 31, 2012 Available-for-Sale Securities: Fixed Maturities	Mar. 31, 2012 Common Stock
Available-for-Sale securities:
Balance at the beginning of the period					$ 1,654	$ 1,342	$ 23	$ 58	$ 170	$ 16	$ 16	$ 156	$ 133	$ 14	$ 2,003	$ 1,563
Net income								(2)				1			1	(2)
Other comprehensive income						4		5	(2)			4		1	2	10
Purchases					54	98		24							54	122	1
Settlements					(55)	(51)		(3)				(1)			(56)	(54)
Transfers into Level 3													7			7
Transfers out of Level 3							(15)								(15)
Balance at the end of the period					1,653	1,393	8	82	168	16	16	160	140	15	1,989	1,646	1
Future Policy Benefits:
Balance at the beginning of the period			(833)	(1,585)
Net income			618	784
Issues			50	(39)
Settlements			(1)
Balance at the end of the period			(266)	(840)
Changes in unrealized gains (losses) relating to assets and liabilities held at the end of the period included in:
Net investment income												1			1
Net realized investment gains (losses)								2								2
Benefits, claims, losses and settlement expenses			609	769
Loss included in net realized investment gains (losses)		2
Gain included in net investment income	1
Cumulative embedded derivative liability			$ (65)	$ (115)

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Income Taxes

3 Months Ended

Mar. 31, 2013

Income Taxes

Income Taxes

14. Income Taxes

The Company’s effective tax rates were 18% and 10% for the three months ended March 31, 2013 and 2012, respectively.  The effective tax rates are lower than the statutory rate as a result of tax preferred items including the dividends received deduction, foreign tax credits and low income housing credits in comparison to the levels of pretax income.  The increase in the effective rate for the three months ended March 31, 2013 compared to the prior year period is the result of higher pretax income and lower dividends received deduction.

The Company is required to establish a valuation allowance for any portion of the deferred tax assets that management believes will not be realized.  Included in deferred tax assets is a significant deferred tax asset relating to capital losses that have been recognized for financial statement purposes but not yet for tax return purposes as well as future deductible capital losses realized for tax return purposes.  Under current U.S. federal income tax law, capital losses generally must be used against capital gain income within five years of the year in which the capital losses are recognized for tax purposes.

Significant judgment is required in determining if a valuation allowance should be established, and the amount of such allowance if required.  Factors used in making this determination include estimates relating to the performance of the business including the ability to generate capital gains.  Consideration is given to, among other things in making this determination, (i) future taxable income exclusive of reversing temporary differences and carryforwards, (ii) future reversals of existing taxable temporary differences, (iii) taxable income in prior carryback years, and (iv) tax planning strategies.  Based on analysis of the Company’s tax position, management believes it is more likely than not that the results of future operations and implementation of tax planning strategies will not allow the Company to realize all of certain state net operating losses and therefore a valuation allowance of $5 million was established as of both March 31, 2013 and December 31, 2012.

As of both March 31, 2013 and December 31, 2012, the Company had $65 million of gross unrecognized tax benefits.  If recognized, approximately $8 million, net of federal tax benefits, of unrecognized tax benefits as of both March 31, 2013 and December 31, 2012 would affect the effective tax rate.

It is reasonably possible that the total amounts of unrecognized tax benefits will change in the next 12 months.   Based on the current audit position of the Company, it is estimated that the total amount of gross unrecognized tax benefits may decrease by $63 million in the next 12 months.

The Company recognizes interest and penalties related to unrecognized tax benefits as a component of the income tax provision.  The Company recognized a net increase of $2 million and a net reduction of $5 million in interest and penalties for the three months ended March 31, 2013 and 2012, respectively.  As of March 31, 2013 and December 31, 2012, the Company had a payable of $32 million and $30 million, respectively, related to accrued interest and penalties.

The Company or one or more of its subsidiaries files income tax returns as part of its inclusion in the consolidated federal income tax returns of Ameriprise Financial, in the U.S. federal jurisdiction and various state jurisdictions.  The Internal Revenue Service (“IRS”) had previously completed its field examination of the 1997 through 2007 tax returns in recent years.  However, for federal income tax purposes, these years except for 2007, continue to remain open as a consequence of certain unagreed-upon issues.  The IRS is in the process of completing the audit of the Company’s income tax returns for 2008 and 2009 and began auditing 2010 and 2011 in the fourth quarter of 2012.  The Company or certain of its subsidiaries’ state income tax returns are currently under examination by various jurisdictions for years ranging from 1997 through 2008 and remain open for the years after 2008.

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Future Policy Benefits, Policy Claims and Other Policyholders' Funds and Separate Account Liabilities (Tables)

3 Months Ended

Mar. 31, 2013

Future Policy Benefits, Policy Claims and Other Policyholders' Funds and Separate Account Liabilities

Schedule of future policy benefits and policy claims and other policyholders' funds

	March 31, 2013		December 31, 2012
	(in millions)
Fixed annuities	$	15,905	$	16,075
Equity indexed annuity (“EIA”) accumulated host values	29		31
EIA embedded derivatives	3		2
Variable annuity fixed sub-accounts	4,832		4,843
Variable annuity guaranteed minimum withdrawal benefits (“GMWB”)	319		799
Variable annuity guaranteed minimum accumulation benefits (“GMAB”)	23		103
Other variable annuity guarantees	13		13
Total annuities	21,124		21,866
Variable universal life (“VUL”)/universal life (“UL”) insurance	2,767		2,760
Indexed universal life (“IUL”) accumulated host values	74		59
IUL embedded derivatives	61		45
VUL/UL insurance additional liabilities	296		294
Other life, disability income and long term care insurance	5,657		5,646
Total future policy benefits	29,979		30,670
Policy claims and other policyholders’ funds	145		132
Total future policy benefits and policy claims and other policyholders’ funds	$	30,124	$	30,802

Schedule of separate account liabilities

	March 31, 2013		December 31, 2012
	(in millions)
Variable annuity variable sub-accounts	$	66,121	$	63,302
VUL insurance variable sub-accounts	6,368		6,051
Other insurance variable sub-accounts	43		42
Total	$	72,532	$	69,395

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Short-term Borrowings (Details) (USD $) In Millions, unless otherwise specified	Mar. 31, 2013	Dec. 31, 2012
Borrowings
Amount of the company's liability including accrued interest	$ 500	$ 501
Repurchase Agreements
Borrowings
Fair value of securities pledged	208	518
Amount of the company's liability including accrued interest	200	501
Weighted average annual interest rate on the FHLB advances (as a percent)	0.40%	0.40%
Federal Home Loan Bank (FHLB) Advances
Borrowings
Fair value of securities pledged	389
Amount of the company's liability including accrued interest	$ 300
Weighted average annual interest rate on the FHLB advances (as a percent)	0.30%

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Financing Receivables (Details) (USD $) In Millions, unless otherwise specified	3 Months Ended									3 Months Ended
	Mar. 31, 2012	Mar. 31, 2013	Dec. 31, 2012	Mar. 31, 2013 Commercial Mortgage Loans	Dec. 31, 2012 Commercial Mortgage Loans	Mar. 31, 2012 Commercial Mortgage Loans	Dec. 31, 2011 Commercial Mortgage Loans	Mar. 31, 2013 Residential Mortgage Loans	Dec. 31, 2012 Residential Mortgage Loans	Mar. 31, 2013 Syndicated Loans	Mar. 31, 2012 Syndicated Loans	Dec. 31, 2012 Syndicated Loans
Rollforward of the allowance for loan losses
Beginning balance	$ 37	$ 30	$ 30	$ 26	$ 26	$ 32	$ 32			$ 4	$ 5
Charge-offs	(1)										(1)
Ending balance	36	30	30	26	26	32	32			4	4
Individually evaluated for impairment	9	5		5		9
Collectively evaluated for impairment	27	25		21		23				4	4
Recorded investment in financing receivables by impairment method and type of loan
Individually evaluated for impairment		48	39	46	39					2
Collectively evaluated for impairment		3,637	3,679	2,455	2,442			890	934	292		303
Total		3,685	3,718	2,501	2,481			890	934	294		303
Recorded investment in financing receivables individually evaluated for impairment with no related allowance for loan losses		12	10
Unamortized discount								72	80
Total loans purchased										22	29
Loans sold										1
Nonperforming loans		$ 10	$ 4

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CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2013	Mar. 31, 2012
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
Net income	$ 240	$ 171
Net unrealized gains (losses) on securities:
Net unrealized securities gains (losses) arising during the period	(141)	42
Reclassification of net securities gains included in net income		(2)
Impact on deferred acquisition costs, deferred sales inducement costs, benefit reserves and reinsurance recoverables	64	(3)
Total net unrealized gains (losses) on securities	(77)	37
Net unrealized losses on derivatives:
Reclassification of net derivative losses included in net income	1	1
Total net unrealized losses on derivatives	1	1
Total other comprehensive income (loss), net of tax	(76)	38
Total comprehensive income	$ 164	$ 209

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Variable Interest Entities

3 Months Ended

Mar. 31, 2013

Variable Interest Entities

Variable Interest Entities

3. Variable Interest Entities

RTA, a subsidiary of RiverSource Life Insurance Company, has variable interests in affordable housing partnerships for which it is not the primary beneficiary and, therefore, does not consolidate.

RTA’s maximum exposure to loss as a result of its investments in the affordable housing partnerships is limited to the carrying values of these investments.  The carrying values are reflected in other investments and were $410 million and $409 million as of March 31, 2013 and December 31, 2012, respectively.  RTA has no obligation to provide financial or other support to the affordable housing partnerships in addition to liabilities already recorded for future funding commitments nor has it provided any additional support to the affordable housing partnerships.  The Company had liabilities of $123 million and $144 million recorded in other liabilities as of March 31, 2013 and December 31, 2012, respectively, related to the future funding commitments for affordable housing partnerships.

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Derivatives and Hedging Activities (Details 3) (Derivatives not designated as hedging instruments, USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2013	Mar. 31, 2012	Dec. 31, 2012
Impact of derivatives not designated as hedging instruments on the Consolidated Statements of Income
Amount of Gain (Loss) on Derivatives Recognized in Income	$ (45)	$ (173)
GMWB and GMAB
Impact of derivatives not designated as hedging instruments on the Consolidated Statements of Income
Amount of Gain (Loss) on Derivatives Recognized in Income	(52)	(174)
Gross notional amount of derivative contracts	146,100		142,100
GMWB and GMAB | Interest rate contracts
Impact of derivatives not designated as hedging instruments on the Consolidated Statements of Income
Amount of Gain (Loss) on Derivatives Recognized in Income	(132)	(225)
GMWB and GMAB | Equity contracts
Impact of derivatives not designated as hedging instruments on the Consolidated Statements of Income
Amount of Gain (Loss) on Derivatives Recognized in Income	(492)	(695)
GMWB and GMAB | Credit contracts
Impact of derivatives not designated as hedging instruments on the Consolidated Statements of Income
Amount of Gain (Loss) on Derivatives Recognized in Income		(3)
GMWB and GMAB | Foreign currency contracts
Impact of derivatives not designated as hedging instruments on the Consolidated Statements of Income
Amount of Gain (Loss) on Derivatives Recognized in Income	5	4
GMWB and GMAB | Embedded derivatives
Impact of derivatives not designated as hedging instruments on the Consolidated Statements of Income
Amount of Gain (Loss) on Derivatives Recognized in Income	567	745
EIA
Impact of derivatives not designated as hedging instruments on the Consolidated Statements of Income
Gross notional amount of derivative contracts	12		10
EIA | Equity contracts
Impact of derivatives not designated as hedging instruments on the Consolidated Statements of Income
Amount of Gain (Loss) on Derivatives Recognized in Income	1	1
EIA embedded derivatives | Equity contracts
Impact of derivatives not designated as hedging instruments on the Consolidated Statements of Income
Amount of Gain (Loss) on Derivatives Recognized in Income	(1)
IUL
Impact of derivatives not designated as hedging instruments on the Consolidated Statements of Income
Gross notional amount of derivative contracts	255		200
IUL | Equity contracts
Impact of derivatives not designated as hedging instruments on the Consolidated Statements of Income
Amount of Gain (Loss) on Derivatives Recognized in Income	4
IUL embedded derivatives | Equity contracts
Impact of derivatives not designated as hedging instruments on the Consolidated Statements of Income
Amount of Gain (Loss) on Derivatives Recognized in Income	3
Other derivatives
Impact of derivatives not designated as hedging instruments on the Consolidated Statements of Income
Amount of Gain (Loss) on Derivatives Recognized in Income	$ 7	$ 1

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Variable Annuity and Insurance Guarantees (Tables)

3 Months Ended

Mar. 31, 2013

Variable Annuity and Insurance Guarantees

Schedule of variable annuity guarantees for which the Company has established additional liabilities

	March 31, 2013							December 31, 2012
Variable Annuity Guarantees by Benefit Type (1)	Total Contract Value		Contract Value in Separate Accounts		Net Amount at Risk(2)		Weighted Average Attained Age	Total Contract Value		Contract Value in Separate Accounts		Net Amount at Risk(2)		Weighted Average Attained Age
	(in millions, except age)
GMDB:
Return of premium	$	48,049	$	46,289	$	41	63	$	45,697	$	43,942	$	61	63
Five/six-year reset	11,382		8,874		78		63	11,233		8,722		115		63
One-year ratchet	7,552		7,126		61		65	7,367		6,933		106		65
Five-year ratchet	1,681		1,627		2		61	1,616		1,563		3		61
Other	978		952		48		68	912		885		62		68
Total — GMDB	$	69,642	$	64,868	$	230	63	$	66,825	$	62,045	$	347	63
GGU death benefit	$	990	$	939	$	104	63	$	958	$	907	$	93	63
GMIB	$	432	$	406	$	56	66	$	425	$	399	$	72	66
GMWB:
GMWB	$	3,980	$	3,962	$	15	66	$	3,898	$	3,880	$	34	66
GMWB for life	30,330		30,199		140		65	28,588		28,462		263		64
Total — GMWB	$	34,310	$	34,161	$	155	65	$	32,486	$	32,342	$	297	64
GMAB	$	3,936	$	3,924	$	2	57	$	3,773	$	3,762	$	5	57

(1) Individual variable annuity contracts may have more than one guarantee and therefore may be included in more than one benefit type.  Variable annuity contracts for which the death benefit equals the account value are not shown in this table.

(2) Represents the current guaranteed benefit amount in excess of the current contract value.  GMIB, GMWB and GMAB benefits are subject to waiting periods and payment periods specified in the contract.

Schedule of changes in additional liabilities for variable annuity and insurance guarantees

	GMDB & GGU			GMIB			GMWB			GMAB			UL
	(in millions)
Balance at January 1, 2012	$	5		$	9		$	1,377		$	237		$	111
Incurred claims	—			(2		)	(624		)	(119		)	17
Paid claims	(2		)	—			—			—			(4		)
Balance at March 31, 2012	$	3		$	7		$	753		$	118		$	124
Balance at January 1, 2013	$	4		$	9		$	799		$	103		$	155
Incurred claims	1			—			(480		)	(80		)	17
Paid claims	(1		)	—			—			—			(3		)
Balance at March 31, 2013	$	4		$	9		$	319		$	23		$	169

Schedule of distribution of separate account balances by asset type for variable annuity contracts providing guaranteed benefits

	March 31,		December 31,
	2013		2012
	(in millions)
Mutual funds:
Equity	$	33,375	$	32,054
Bond	26,477		26,165
Other	4,209		3,991
Total mutual funds	$	64,061	$	62,210

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Investments (Details 4) (USD $) In Millions, unless otherwise specified	3 Months Ended
	Mar. 31, 2013	Mar. 31, 2012
Rollforward of the net unrealized securities gains (losses) on Available-for-Sale securities included in accumulated other comprehensive income
Net unrealized securities losses arising during the period	$ (141)	$ 42
Net realized gains and losses on Available-for-Sale securities
Gross realized investment gains		4
Other-than-temporary impairments	(1)	(1)
Total	(1)	3
Net Unrealized Securities Gains
Rollforward of the net unrealized securities gains (losses) on Available-for-Sale securities included in accumulated other comprehensive income
Balance at the beginning of the period	1,930	1,472
Net unrealized securities gains arising during the period		65
Net unrealized securities losses arising during the period	(217)
Reclassification of net securities (gains) losses included in net income	1	(3)
Impact on DAC, DSIC, benefit reserves and reinsurance recoverables	98	(5)
Balance at the end of the period	1,812	1,529
Deferred Income Tax
Rollforward of the net unrealized securities gains (losses) on Available-for-Sale securities included in accumulated other comprehensive income
Balance at the beginning of the period	(675)	(515)
Net unrealized securities gains arising during the period		(23)
Net unrealized securities losses arising during the period	76
Reclassification of net securities (gains) losses included in net income	(1)	1
Impact on DAC, DSIC, benefit reserves and reinsurance recoverables	(34)	2
Balance at the end of the period	(634)	(535)
Accumulated Other Comprehensive Income Related to Net Unrealized Securities Gains
Rollforward of the net unrealized securities gains (losses) on Available-for-Sale securities included in accumulated other comprehensive income
Balance at the beginning of the period	1,255	957
Net unrealized securities gains arising during the period		42
Net unrealized securities losses arising during the period	(141)
Reclassification of net securities (gains) losses included in net income		(2)
Impact on DAC, DSIC, benefit reserves and reinsurance recoverables	64	(3)
Balance at the end of the period	1,178	994
Noncredit related impairments on securities and net unrealized securities losses on previously impaired securities, included in Accumulated Other Comprehensive Income	$ (12)	$ (18)

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Shareholder's Equity

3 Months Ended

Mar. 31, 2013

Shareholder's Equity

Shareholder's Equity

13.  Shareholder’s Equity

The following table provides information related to amounts reclassified from AOCI for the three months ended March 31, 2013:

AOCI Reclassification	Location of Gain (Loss) Recognized in Income	AmountReclassifiedfrom AOCI
		(in millions)
Net unrealized losses on Available-for-Sale securities	Net investment income	$	1
Tax benefit	Income tax provision	(1		)
Net of tax		$	—
Losses on cash flow hedges:
Swaptions	Net investment income	$	2
Tax benefit	Income tax provision	(1		)
Net of tax		$	1

The Company made adjustments to AOCI for the impact to DAC, DSIC, benefit reserves and reinsurance recoverable on net unrealized securities gains of $64 million, net of tax. See Note 4 for additional information related to the impact of DAC, DSIC, benefit reserves and reinsurance recoverable on net unrealized securities losses included in AOCI. See Note 12 for additional information regarding the Company’s cash flow hedges.