0001193125-14-140651.txt : 20140411 0001193125-14-140651.hdr.sgml : 20140411 20140411165106 ACCESSION NUMBER: 0001193125-14-140651 CONFORMED SUBMISSION TYPE: 485BPOS PUBLIC DOCUMENT COUNT: 4 FILED AS OF DATE: 20140411 DATE AS OF CHANGE: 20140411 EFFECTIVENESS DATE: 20140428 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Metropolitan Life Separate Account UL CENTRAL INDEX KEY: 0000858997 IRS NUMBER: 135581829 STATE OF INCORPORATION: NY FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 485BPOS SEC ACT: 1933 Act SEC FILE NUMBER: 033-57320 FILM NUMBER: 14760588 BUSINESS ADDRESS: STREET 1: METROPOLITAN LIFE INSURANCE COMPANY STREET 2: 200 PARK AVENUE CITY: NEW YORK STATE: NY ZIP: 10166 BUSINESS PHONE: 2125788717 MAIL ADDRESS: STREET 1: METROPOLITAN LIFE INSURANCE COMPANY STREET 2: 200 PARK AVENUE CITY: NEW YORK STATE: NY ZIP: 10166 FORMER COMPANY: FORMER CONFORMED NAME: METROPOLITAN LIFE SEPARATE ACCOUNT UL DATE OF NAME CHANGE: 19920703 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Metropolitan Life Separate Account UL CENTRAL INDEX KEY: 0000858997 IRS NUMBER: 135581829 STATE OF INCORPORATION: NY FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 485BPOS SEC ACT: 1940 Act SEC FILE NUMBER: 811-06025 FILM NUMBER: 14760589 BUSINESS ADDRESS: STREET 1: METROPOLITAN LIFE INSURANCE COMPANY STREET 2: 200 PARK AVENUE CITY: NEW YORK STATE: NY ZIP: 10166 BUSINESS PHONE: 2125788717 MAIL ADDRESS: STREET 1: METROPOLITAN LIFE INSURANCE COMPANY STREET 2: 200 PARK AVENUE CITY: NEW YORK STATE: NY ZIP: 10166 FORMER COMPANY: FORMER CONFORMED NAME: METROPOLITAN LIFE SEPARATE ACCOUNT UL DATE OF NAME CHANGE: 19920703 0000858997 S000004219 Metropolitan Life Separate Account UL C000011872 MetFlex Flexible Premium Variable Life 485BPOS 1 d632302d485bpos.txt METFLEX POST-EFFECTIVE AMENDMENT NO. 27 AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON APRIL 11, 2014 REGISTRATION NOS. 033-57320 811-06025 ================================================================================ U.S. SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM N-6 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 POST-EFFECTIVE AMENDMENT NO. 27 [X] AND/OR REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 AMENDMENT NO. 67 [X] METROPOLITAN LIFE SEPARATE ACCOUNT UL (EXACT NAME OF REGISTRANT) METROPOLITAN LIFE INSURANCE COMPANY (NAME OF DEPOSITOR) 200 PARK AVENUE NEW YORK, NY 10166 (ADDRESS OF DEPOSITOR'S PRINCIPAL EXECUTIVE OFFICES) ----------------- RICARDO A. ANZALDUA, ESQ. EXECUTIVE VICE PRESIDENT AND GENERAL COUNSEL METROPOLITAN LIFE INSURANCE COMPANY 1095 AVENUE OF THE AMERICAS NEW YORK, NY 10036 (NAME AND ADDRESS OF AGENT FOR SERVICE) COPY TO: W. THOMAS CONNER, ESQUIRE REED SMITH LLP 1301 K STREET, NW, SUITE 1100 WASHINGTON, D.C. 20005 It is proposed that this filing will become effective (check appropriate box) [_] immediately upon filing pursuant to paragraph (b) [X] on April 28, 2014 pursuant to paragraph (b) [_] 60 days after filing pursuant to paragraph (a)(1) [_] on (date) pursuant to paragraph (a)(1) of Rule 485 [_] this post-effective amendment designates a new effective date for a previously filed post-effective amendment Title of Securities Being Registered: Interests in Metropolitan Life Separate Account UL, which funds certain Variable Universal Life Insurance Policies. ================================================================================ METROPOLITAN LIFE INSURANCE COMPANY METROPOLITAN LIFE SEPARATE ACCOUNT UL METFLEX FLEXIBLE PREMIUM VARIABLE LIFE INSURANCE POLICIES SUPPLEMENT DATED APRIL 28, 2014 TO PROSPECTUS DATED APRIL 28, 2014 This supplement is prepared for owners of MetFlex C and MetFlex policies issued prior to January 1, 2009. It describes certain differences in the charges imposed under your Policy and the charges described in the Fee Table of the current MetFlex Exec prospectus. You should read and retain this supplement. METFLEX C POLICIES For MetFlex C Policies issued on or after May 1, 1996 and before August 1, 2000, the current sales charge imposed in Policy years 1 to 10 is up to 9% of the annual target premium paid, and the current administrative charge imposed is up to 1.05% of the annual target premium paid. For MetFlex C Policies issued before January 1, 2009, the current charge for cost of insurance for coverage under the term benefit ranges from $0.03 to $13.93 per $1,000 of the term insurance amount. The maximum charge for cost of insurance for coverage under both the base Policy and the term benefit ranges from $0.09 to $30.45 per $1,000 of term insurance amount. For MetFlex C Policies, the current mortality and expense risk charge is 0.48% in Policy years 1 to 9, 0.36% in Policy years 10 to 20, and 0.30% thereafter. For MetFlex C Policies issued on or after November 5, 2001 and before February 1, 2004 with the Enhanced Cash Surrender Value Rider, if you request a full cash withdrawal in the first seven Policy years, we will refund the amounts shown in Table B below: TABLE B
PORTION OF COST OF TERM INSURANCE CHARGES DEDUCTED PORTION OF DURING POLICY YEAR OF POLICY YEAR OF CUMULATIVE PREMIUM FULL CASH WITHDRAWAL FULL CASH WITHDRAWAL CHARGES TO BE REFUNDED* TO BE REFUNDED -------------------- ----------------------- -------------------------- 1 100% 75% 2 90% 50% 3 75% 25% 4 60% None 5 45% None 6 30% None 7 15% None 8 and later None None
* The percent shown is applied to the cumulative sales, tax, and administrative charges deducted from your premium. METFLEX POLICIES For MetFlex Policies issued on or after September 1, 1993 and before January 1, 2009, there is no current sales charge and the maximum sales charge imposed is 1.0% of annual target premium paid in all Policy years. The current administrative charge is up to 1.05% of annual target premium paid in any Policy year and the maximum administrative charge is up to 1.05% of all premiums paid in all Policy years. For MetFlex Policies issued before January 1, 2009, the maximum cost of term insurance charge ranges from $0.09 to $30.45 per $1,000 of the term insurance amount. The current mortality and expense risk charge is 0.60% in Policy years 1 to 9 and 0.30% thereafter. PROSPECTUS FOR METFLEX, A FLEXIBLE PREMIUM VARIABLE LIFE INSURANCE POLICY ("POLICY") ISSUED BY METROPOLITAN LIFE INSURANCE COMPANY ("METLIFE") APRIL 28, 2014 This prospectus provides you with important information about MetLife's MetFlex Policies. However, this prospectus is not the Policy. The Policy, rather, is a separate written agreement that MetLife issues to you. The Policy is designed to provide: .. Life insurance coverage .. Flexible premium payments .. A choice among three death benefit options .. A method of financing certain deferred compensation plans, post-retirement benefits and payroll deduction programs You may allocate premium payments to and transfer cash value among a fixed interest account ("Fixed Account") and the Metropolitan Life Separate Account UL investment divisions which invest in the following corresponding fund ("Fund") portfolios: AIM Variable Insurance Funds (Invesco Variable Insurance Funds) --------------------------------------------------------------- INVESCO V.I. COMSTOCK FUND--SERIES II INVESCO V.I. GOVERNMENT SECURITIES FUND--SERIES II INVESCO V.I. INTERNATIONAL GROWTH FUND--SERIES I AllianceBernstein Variable Products Series Fund, Inc. ----------------------------------------------------- GLOBAL THEMATIC GROWTH PORTFOLIO--CLASS B INTERMEDIATE BOND PORTFOLIO--CLASS B INTERNATIONAL VALUE PORTFOLIO--CLASS A American Century Variable Portfolios, Inc.--Class I --------------------------------------------------- VP CAPITAL APPRECIATION FUND American Funds Insurance Series(R)--Class 2 ------------------------------------------- AMERICAN FUNDS GROWTH FUND AMERICAN FUNDS HIGH-INCOME BOND FUND AMERICAN FUNDS INTERNATIONAL FUND AMERICAN FUNDS U.S. GOVERNMENT/AAA-RATED SECURITIES FUND Dreyfus Variable Investment Fund--Service Shares ------------------------------------------------ INTERNATIONAL VALUE PORTFOLIO Fidelity(R) Variable Insurance Products --------------------------------------- ASSET MANAGER: GROWTH(R) PORTFOLIO--SERVICE CLASS CONTRAFUND(R) PORTFOLIO--SERVICE CLASS EQUITY-INCOME PORTFOLIO--SERVICE CLASS FREEDOM 2010 PORTFOLIO--INITIAL CLASS FREEDOM 2015 PORTFOLIO--INITIAL CLASS FREEDOM 2020 PORTFOLIO--INITIAL CLASS FREEDOM 2025 PORTFOLIO--INITIAL CLASS FREEDOM 2030 PORTFOLIO--INITIAL CLASS HIGH INCOME PORTFOLIO--INITIAL CLASS INVESTMENT GRADE BOND PORTFOLIO--SERVICE CLASS MID CAP PORTFOLIO--SERVICE CLASS 2 Franklin Templeton Variable Insurance Products Trust ---------------------------------------------------- FRANKLIN MUTUAL GLOBAL DISCOVERY VIP FUND--CLASS 2 TEMPLETON FOREIGN VIP FUND--CLASS 1 TEMPLETON GLOBAL BOND VIP FUND--CLASS 1 Goldman Sachs Variable Insurance Trust--Institutional Shares ------------------------------------------------------------ GOLDMAN SACHS SMALL CAP EQUITY INSIGHTS FUND Janus Aspen Series ------------------ BALANCED PORTFOLIO--SERVICE SHARES ENTERPRISE PORTFOLIO--SERVICE SHARES FORTY PORTFOLIO--SERVICE SHARES JANUS PORTFOLIO--INSTITUTIONAL SHARES OVERSEAS PORTFOLIO--SERVICE SHARES Legg Mason Partners Variable Equity Trust ----------------------------------------- LEGG MASON INVESTMENT COUNSEL VARIABLE SOCIAL AWARENESS PORTFOLIO Met Investors Series Trust -------------------------- CLARION GLOBAL REAL ESTATE PORTFOLIO--CLASS A MORGAN STANLEY MID CAP GROWTH PORTFOLIO-- CLEARBRIDGE AGGRESSIVE GROWTH PORTFOLIO-- CLASS A CLASS A OPPENHEIMER GLOBAL EQUITY PORTFOLIO--CLASS A HARRIS OAKMARK INTERNATIONAL PORTFOLIO--CLASS A PIMCO INFLATION PROTECTED BOND PORTFOLIO-- INVESCO MID CAP VALUE PORTFOLIO--CLASS A CLASS A INVESCO SMALL CAP GROWTH PORTFOLIO--CLASS B PIMCO TOTAL RETURN PORTFOLIO--CLASS A JPMORGAN SMALL CAP VALUE PORTFOLIO--CLASS A PIONEER FUND PORTFOLIO--CLASS A LORD ABBETT BOND DEBENTURE PORTFOLIO--CLASS A T. ROWE PRICE LARGE CAP VALUE PORTFOLIO--CLASS A METLIFE ASSET ALLOCATION 100 PORTFOLIO--CLASS B THIRD AVENUE SMALL CAP VALUE PORTFOLIO--CLASS B MFS(R) EMERGING MARKETS EQUITY PORTFOLIO--CLASS WMC LARGE CAP RESEARCH PORTFOLIO--CLASS A B MFS(R) RESEARCH INTERNATIONAL PORTFOLIO--CLASS B
2 Metropolitan Series Fund ------------------------ BAILLIE GIFFORD INTERNATIONAL STOCK PORTFOLIO-- METLIFE ASSET ALLOCATION 80 PORTFOLIO--CLASS B CLASS A METLIFE MID CAP STOCK INDEX PORTFOLIO--CLASS A BARCLAYS AGGREGATE BOND INDEX PORTFOLIO-- METLIFE STOCK INDEX PORTFOLIO--CLASS A CLASS A MFS(R) TOTAL RETURN PORTFOLIO--CLASS B BLACKROCK BOND INCOME PORTFOLIO--CLASS A MFS(R) VALUE PORTFOLIO--CLASS A BLACKROCK CAPITAL APPRECIATION PORTFOLIO-- MSCI EAFE(R) INDEX PORTFOLIO--CLASS A CLASS A NEUBERGER BERMAN GENESIS PORTFOLIO--CLASS A BLACKROCK MONEY MARKET PORTFOLIO--CLASS A RUSSELL 2000(R) INDEX PORTFOLIO--CLASS A FRONTIER MID CAP GROWTH PORTFOLIO--CLASS A T. ROWE PRICE LARGE CAP GROWTH PORTFOLIO-- JENNISON GROWTH PORTFOLIO--CLASS A CLASS A LOOMIS SAYLES SMALL CAP CORE PORTFOLIO--CLASS A T. ROWE PRICE SMALL CAP GROWTH PORTFOLIO-- MET/ARTISAN MID CAP VALUE PORTFOLIO--CLASS B CLASS A METLIFE ASSET ALLOCATION 20 PORTFOLIO--CLASS B WMC BALANCED PORTFOLIO--CLASS A METLIFE ASSET ALLOCATION 40 PORTFOLIO--CLASS B WMC CORE EQUITY OPPORTUNITIES PORTFOLIO-- METLIFE ASSET ALLOCATION 60 PORTFOLIO--CLASS B CLASS A
MFS(R) Variable Insurance Trust--Service Class ---------------------------------------------- MFS(R) GLOBAL EQUITY SERIES MFS(R) NEW DISCOVERY SERIES MFS(R) Variable Insurance Trust II--Service Class ------------------------------------------------- MFS(R) HIGH YIELD PORTFOLIO Oppenheimer Variable Account Funds--Non-Service Shares ------------------------------------------------------ OPPENHEIMER MAIN STREET SMALL CAP FUND(R)/VA PIMCO Variable Insurance Trust--Administrative Class ---------------------------------------------------- PIMCO ALL ASSET PORTFOLIO PIMCO COMMODITYREALRETURN(R) STRATEGY PORTFOLIO PIMCO LONG-TERM U.S. GOVERNMENT PORTFOLIO PIMCO LOW DURATION PORTFOLIO Pioneer Variable Contracts Trust--Class I ----------------------------------------- PIONEER MID CAP VALUE VCT PORTFOLIO Putnam Variable Trust--Class IB ------------------------------- PUTNAM VT INTERNATIONAL VALUE FUND Royce Capital Fund--Investment Class ------------------------------------ ROYCE MICRO-CAP PORTFOLIO ROYCE SMALL-CAP PORTFOLIO The Universal Institutional Funds, Inc.--Class I ------------------------------------------------ EMERGING MARKETS DEBT PORTFOLIO EMERGING MARKETS EQUITY PORTFOLIO Wells Fargo Variable Trust--Class 2 ----------------------------------- VT TOTAL RETURN BOND FUND 3 Certain Funds and/or Portfolios have been subject to a merger, substitution or other change. Please see Appendix A--"Additional Information Regarding the Funds." Separate prospectuses for the Metropolitan Series Fund, the Met Investors Series Trust, AIM Variable Insurance Funds (Invesco Variable Insurance Funds), the AllianceBernstein Variable Products Series Fund, Inc., American Century Variable Portfolios, Inc., American Funds Insurance Series(R), the Dreyfus Variable Investment Fund, Fidelity(R) Variable Insurance Products, the Franklin Templeton Variable Insurance Products Trust, the Goldman Sachs Variable Insurance Trust, the Janus Aspen Series, the Legg Mason Partners Variable Equity Trust, the MFS(R) Variable Insurance Trust, MFS(R) Variable Insurance Trust II, the Oppenheimer Variable Account Funds, the PIMCO Variable Insurance Trust, the Pioneer Variable Contracts Trust, the Putnam Variable Trust, the Royce Capital Fund, The Universal Institutional Funds, Inc. and the Wells Fargo Variable Trust (each a "Fund") are available from us by calling 1-908-253-1400. They describe in greater detail an investment in the portfolios listed above. Before purchasing a Policy, read the information in this prospectus and in the prospectus for each Fund. Keep these prospectuses for future reference. We do not guarantee how any of the portfolios will perform. Since the Fixed Account is not registered under the federal securities laws, this Prospectus contains only limited information about the Fixed Account. The Policy gives you more information on the operation of the Fixed Account. Policies issued in your state may provide different features and benefits from, and impose different costs than, those described in this Prospectus. Your actual Policy and any endorsements are the controlling documents. You should read the Policy carefully for any variations in your state. Neither the Securities and Exchange Commission ("SEC") nor any state securities authority has approved or disapproved of these securities, nor have they determined if this Prospectus is accurate or complete. Any representation otherwise is a criminal offense. This Prospectus does not constitute an offering in any jurisdiction where such offering may not lawfully be made. Interests in the Separate Account, the Fixed Account and the Portfolios are not deposits, obligations of, or insured or guaranteed by, the U.S. Government, any bank or other depository institution including the Federal Deposit Insurance Corporation ("FDIC"), the Federal Reserve Board or any other agency or entity or person. We do not authorize any representations about this offering other than as contained in this Prospectus or its supplements or in our authorized supplemental sales material. 4 TABLE OF CONTENTS
PAGE IN THIS SUBJECT PROSPECTUS ------- ---------- Contacting Us............................................... 6 Summary of Benefits and Risks............................... 6 Policy Benefits............................................ 6 Risks of a Policy.......................................... 7 Fee Tables.................................................. 9 Transaction Fees........................................... 9 Periodic Charges Other Than Portfolio Operating Expenses... 11 Portfolio Operating Expenses............................... 12 MetLife..................................................... 21 The Fixed Account.......................................... 21 Separate Account UL........................................ 22 The Funds.................................................. 23 The Portfolio Share Classes that We Offer................ 32 Substitution of Portfolios............................... 32 Voting Rights............................................ 32 Issuing a Policy............................................ 32 Payment and Allocation of Premiums.......................... 33 Paying Premiums............................................ 34 Maximum and Minimum Premium Payments....................... 34 Allocating Net Premiums.................................... 35 Insurance Proceeds.......................................... 35 Death Benefit Options...................................... 36 Minimum Death Benefit...................................... 37 Specified Face Amount...................................... 38 Income Plans............................................... 39 Cash Value, Transfers and Withdrawals....................... 40 Cash Value................................................. 40 Cash Value Transfers....................................... 40 Surrender and Withdrawal Privileges........................ 44 Benefit at Final Date...................................... 45 Loan Privileges............................................. 46 Optional Rider Benefits..................................... 47 Term Benefit............................................... 47 Charges and Deductions...................................... 48 Important Information Applicable to all Policy Charges and Deductions............................................... 48 Charges Deducted From Premiums............................. 49 Charges Included in the Monthly Deduction.................. 50 Charges for Certain Optional Rider Benefits................ 51 Variations in Charges...................................... 51 Portfolio Company Charges.................................. 52 Other Charges.............................................. 52 Policy Termination and Reinstatement........................ 52 Federal Tax Matters......................................... 53 Rights We Reserve........................................... 57 Other Policy Provisions..................................... 58 Sales of Policies........................................... 60 Legal Proceedings........................................... 63 Restrictions on Financial Transactions...................... 64 Financial Statements........................................ 64 Appendix A.................................................. 65
5 CONTACTING US [SIDEBAR:YOU CAN CONTACT US AT OUR DESIGNATED OFFICE.] You can communicate all of your requests, instructions and notifications to us by contacting us in writing at our Designated Office. We may require that certain requests, instructions and notifications be made on forms that we provide. These include: changing your beneficiary; taking a Policy loan; changing your death benefit option; taking a partial withdrawal; surrendering your Policy; making transfer requests (including elections with respect to the systematic investment strategies); or changing your premium allocations. Our Designated Office is MetLife--SBR, 501 Route 22, Bridgewater, NJ 08807. We may name additional or alternate Designated Offices. If we do, we will notify you in writing. SUMMARY OF BENEFITS AND RISKS This summary gives an overview of the Policy and is qualified by the more detailed information in the balance of this Prospectus and the Policy. MetLife issues the Policies. We offer the Policies to employers, employer sponsored plans, or other organizations or individuals associated with such employers, plans or organizations. We designed the Policies for financing nonqualified deferred compensation plans, other post-employment benefits, certain employer sponsored payroll deduction programs or other purposes. POLICY BENEFITS PREMIUM PAYMENT FLEXIBILITY. The Policy allows flexibility in making premium payments. The Policy will remain in force as long as the cash surrender value is large enough to cover one monthly deduction, regardless of whether or not premium payments have been made. CASH VALUE. Your cash value in the Policy reflects your premium payments, the charges we deduct, interest we credit if you have cash value in our fixed interest account, any investment experience you have in our Separate Account, as well as your loan and withdrawal activity. TRANSFERS AND SYSTEMATIC INVESTMENT STRATEGIES. You may transfer cash value among the funding options, subject to certain limits, including restrictions on frequent transfers (see "Cash Value, Transfers and Withdrawals"). You may also choose among four systematic investment strategies: the Equity Generator/SM/, the Equalizer/SM/, the Allocator/SM/, and the Rebalancer/SM/. SPECIFIED FACE AMOUNT OF INSURANCE. Within certain limits, you may choose your specified face amount of insurance when the Policy is issued. You may also change the amount at any time after the first Policy year, subject to our rules and procedures. DEATH BENEFIT OPTIONS. Generally, you have a choice among three options. These range from an amount equal to the specified face amount to an amount equal to the specified face amount plus the policy cash value at the date of death. INCOME PLANS. The insurance proceeds can be paid under a variety of income plans that are available under the Policy. 6 SURRENDERS, PARTIAL WITHDRAWALS AND LOANS. Within certain limits, you may take partial withdrawals and loans from the Policy. You may also surrender your Policy for its cash surrender value. TAX ADVANTAGES. In general, you will not pay income taxes on any cash value that accrues in your Policy prior to a distribution. If you meet certain requirements, favorable distribution rules will apply. The death benefit may be subject to Federal and state estate taxes, but your beneficiary will generally not be subject to income tax on the death benefit. In the case of employer-owned life insurance as defined in Section 101(j) of the Internal Revenue Code, the amount of the death benefit excludable from gross income is limited to premiums paid unless the Policy falls within certain specified exceptions and a notice and consent requirement is satisfied before the Policy is issued. As with any taxation matter, you should consult with and rely on the advice of your own tax advisor. TERM RIDER. This rider provides coverage on the insured to age 95. The amount of sales charge you pay will be less if coverage is obtained through this rider rather than as part of the Policy. The current charges for the cost of insurance are lower for coverage under the term rider than under the base Policy. For details, see "Optional Rider Benefits--Term Benefit." OTHER OPTIONAL RIDER BENEFITS. You may be eligible for certain other benefits provided by rider, subject to certain underwriting requirements and the payment of additional premiums. We will deduct any charges for the rider(s) (other than the charge for the interim term insurance rider) as part of the monthly deduction. RISKS OF A POLICY This Prospectus discusses the risks associated with purchasing the Policy. Prospectuses for the Funds discuss the risks associated with investment in the Fund described therein. Each of the Separate Account UL investment divisions that is available to you under the Policy invests solely in a corresponding "Portfolio" of a Fund. INVESTMENT RISK. MetLife does not guarantee the investment performance of the variable investment options and you should consider your risk tolerance before selecting any of these options. You will be subject to the risk that investment performance will be unfavorable and that your cash value will decrease. In addition, we deduct Policy fees and charges from your Policy's cash value, which can significantly reduce your Policy's cash value. During times of poor investment performance, these deductions may have an even greater impact on your Policy's cash value. It is possible to lose your full investment and your Policy could terminate without value, unless you pay additional premiums. If you allocate cash value to the Fixed Account, then we credit such cash value with a declared rate of interest. You assume the risk that the rate may decrease, although it will never be lower than the guaranteed minimum annual effective rate of 2.5% (4% for Policies issued prior to February 24, 2012). SURRENDER AND WITHDRAWAL RISKS. The Policies are designed to provide lifetime insurance protection. They are not offered primarily as an investment, and are not suitable as a short-term savings vehicle. You should purchase the Policy only if you have the financial ability to keep it in force for a substantial period of time. You should not purchase the Policy if you intend to surrender all or part of the Policy's cash value in the near future. 7 RISK OF POLICY TERMINATION. Your Policy may terminate without value if you have paid an insufficient amount of premiums or if the investment experience of the investment divisions is poor. If your cash surrender value is not enough to pay the monthly deduction, your Policy will terminate without value unless you make a premium payment sufficient to cover two monthly deductions within the 61-day grace period. If your Policy does terminate, your insurance coverage will terminate (although you will be given an opportunity to reinstate your coverage if you satisfy certain requirements). Lapse of a policy on which there is an outstanding loan may have adverse tax consequences. POLICY CHARGE AND EXPENSE INCREASE. We have the right to increase certain Policy charges. TAX LAW RISKS. We anticipate that the Policy should generally be deemed a life insurance contract under Federal tax law. The insurance proceeds payable upon death of the insured under the Policy will never be less than the minimum amount required for the Policy to be treated as life insurance under Section 7702 of the Internal Revenue Code, as in effect on the date the Policy was issued. The guidance, however, is not entirely clear in certain circumstances, for example, with respect to Policies issued on a substandard risk basis. In general, you should not be deemed to be in receipt of any portion of your Policy's cash value until there is an actual distribution from the Policy. Although the beneficiary generally should not have to pay Federal income tax on the insurance proceeds, other taxes, such as estate taxes, may apply. In the case of employer-owned life insurance as defined in Section 101(j), the amount of the death benefit excludable from gross income is limited to premiums paid unless the Policy falls within certain specified exceptions and a notice and consent requirement is satisfied before the Policy is issued. If you pay more than a certain amount of premiums, you may cause your Policy to become a "modified endowment contract." If it does, you will pay income taxes on loans and other amounts we pay out to you (except for payment of insurance proceeds), to the extent of any gains in your Policy (which is generally the excess of cash value over the premiums paid). In this case, an additional 10% tax penalty may also apply. If the Policy is not a modified endowment contract, distributions generally will be treated first as a return of basis or investment in the contract and then as taxable income. Moreover, loans will generally not be treated as distributions. Finally, neither distributions nor loans from a Policy that is not a modified endowment contract are subject to the 10% penalty tax. If your Policy is part of an equity split dollar arrangement under the economic benefit regime, there is a risk that some portion of the cash value may be taxed prior to any Policy distribution. Tax laws, regulations, and interpretations have often been changed in the past and such changes continue to be proposed. As with any taxation matter, you should consult with and rely on the advice of your own tax advisor. 8 FEE TABLES The following tables describe the fees and expenses that you will pay when buying, owning, and surrendering the Policy. The charges set forth in the first two tables may vary by group, based on anticipated variations in our costs or risks associated with the group or individuals in the group that the charge was intended to cover. Our variations in the charges will be made in accordance with our established and uniformly applied administrative procedures. Any variations in charges will be reasonable and will not be unfairly discriminatory to the interests of any Policy owner. In addition to the following tables, certain charges that we don't currently impose (but which we have the right to impose on your Policy in the future) are described under "Charges and Deductions--Other Charges," further back in this Prospectus. In certain cases, we have the right to increase our charges for new Policies, as well as for Policies already outstanding. The maximum charges in such cases are shown in the far right-hand columns of each of the first three tables below. TRANSACTION FEES This table describes the fees and expenses that you will pay at the time that you buy the Policy, surrender the Policy, or transfer cash value among the variable investment options or the Fixed Account.
WHEN CHARGE CURRENT AMOUNT MAXIMUM AMOUNT CHARGE IS DEDUCTED DEDUCTED WE CAN DEDUCT --------------------------------------------------------------------------------- Sales Charge/1,2/ On payment of POLICY YEARS 1 TO 10, POLICY YEARS 1 TO 10, premium up to 6.5% of annual up to 9% of annual target premium paid target premium paid POLICY YEARS 11 AND POLICY YEARS 11 AND LATER, up to 3% of LATER, same as annual target Current Amount for premium paid those years 0% on premiums 0% on premiums paid in excess of paid in excess of annual target annual target premium in all Policy premium in all Policy years years --------------------------------------------------------------------------------- Charge for average On payment of 2.25% of each Same as Current expected state and premium premium payment Amount local taxes attributable to premiums --------------------------------------------------------------------------------- Charge for expected On payment of 1.2% of each Same as Current federal taxes premium premium payment Amount attributable to premiums ---------------------------------------------------------------------------------
9
WHEN CHARGE CURRENT AMOUNT MAXIMUM AMOUNT CHARGE IS DEDUCTED DEDUCTED WE CAN DEDUCT --------------------------------------------------------------------------------------------- Administrative On payment of POLICY YEARS 1 TO 10, Up to 1.05% of Charge/1/ premium up to 0.55% of annual annual target target premium paid premium paid in all Policy years POLICY YEARS 11 AND LATER, up to 1.05% of 0.05% of premiums annual target paid in excess of premium paid annual target premium in all Policy 0.05% on premiums years paid in excess of annual target premium in all Policy years --------------------------------------------------------------------------------------------- Transfer Fee On transfer of cash Not currently $25 per transfer, and value among charged none for transfers investment divisions under Systematic or to or from the Investment Fixed Account Strategies --------------------------------------------------------------------------------------------- Interim Term On payment of first Highest: $13.93 per Highest: $24.65 per Insurance Benefit/3/ premium if rider is $1,000 of term $1,000 of term (applies only if you elected insurance amount insurance amount elected rider at issue) Lowest: $0.03 per Lowest: $0.04 per Highest and Lowest $1,000 of term $1,000 of term Charge Among All insurance amount insurance amount Possible Insureds Charge for male, $0.152 per $1,000 of $0.271 per $1,000 of issue age 47, term insurance term insurance nonsmoker, amount amount Guaranteed Issue underwriting class --------------------------------------------------------------------------------------------- Enhanced Cash On premium 0.25% of each Same as Current Surrender Value payments made premium payment Amount Rider/4/ during the first five made during the first Policy years five Policy years --------------------------------------------------------------------------------------------- Underwriting Charge On face amount Not currently Up to $3 per $1,000 (applies only if you increase charged of increase request an increase in your specified face amount)
-------- /1/ See "Charges and Deductions--Annual Target Premium" for a detailed discussion of the determination of the annual target premium. /2/ For Policies issued with the Refund of Sales Charge Rider, if you request a full cash withdrawal during the first five Policy years, we will refund any sales charges deducted within 365 days prior to the date the request is received at our Designated Office. This rider is not available in New Jersey. /3/ This charge varies based on individual characteristics of the insured or of individuals in the group that the charge was intended to cover, and may not be representative of the charge that you will pay. You can obtain more information about the charges that would apply by contacting your insurance sales representative. If you would like, we will provide you with an illustration of the impact of these and other charges under the Policy based on various assumptions. /4/ For Policies issued with the Enhanced Cash Surrender Value Rider on or after February 1, 2004, if you request a full cash withdrawal during the first ten Policy years, we will refund (a) part of the cumulative charges we have deducted from your premium payments and (b) part of the cost of term insurance we have deducted in the current Policy year, as shown in Table A below. However, we will not pay this refund if the full cash withdrawal is related to an exchange pursuant to Section 1035 of the Internal Revenue Code. This rider is subject to state approval. 10 TABLE A
PORTION OF COST OF TERM INSURANCE CHARGES DEDUCTED PORTION OF DURING POLICY YEAR OF POLICY YEAR OF CUMULATIVE PREMIUM FULL CASH WITHDRAWAL FULL CASH WITHDRAWAL CHARGES TO BE REFUNDED* TO BE REFUNDED ----------------------------------------------------------------------- 1 100% 95% ----------------------------------------------------------------------- 2 95% 85% ----------------------------------------------------------------------- 3 90% 75% ----------------------------------------------------------------------- 4 85% 65% ----------------------------------------------------------------------- 5 80% 55% ----------------------------------------------------------------------- 6 75% 45% ----------------------------------------------------------------------- 7 70% 35% ----------------------------------------------------------------------- 8 65% 25% ----------------------------------------------------------------------- 9 60% 15% ----------------------------------------------------------------------- 10 55% 5% ----------------------------------------------------------------------- 11 and later None None -----------------------------------------------------------------------
* The percent shown is applied to the cumulative sales, tax, and administrative charges deducted from your premium. PERIODIC CHARGES OTHER THAN PORTFOLIO OPERATING EXPENSES These tables describe other fees and expenses that you will pay periodically during the time that you own the Policy not including the fees and expenses of the Portfolios. PERIODIC CHARGES
WHEN CHARGE CURRENT AMOUNT MAXIMUM AMOUNT CHARGE IS DEDUCTED DEDUCTED WE CAN DEDUCT ----------------------------------------------------------------------------------------------------------- Cost of Term Insurance On each monthly Highest: $35.30 per Highest: $35.30 per for coverage under base anniversary of the Policy $1,000 of term insurance $1,000 of term insurance policy /1, 2/ amount amount Highest and Lowest Charge Among All Possible Lowest: $0.02 per $1,000 Lowest: $0.04 per $1,000 Insureds of term insurance amount of term insurance amount Charge for male, issue $0.152 per $1,000 of term $0.271 per $1,000 of term age 47, nonsmoker, insurance amount insurance amount Guaranteed Issue underwriting class ----------------------------------------------------------------------------------------------------------- Cost of Term Insurance On each monthly Highest: $26.48 per Highest: $35.30 per for coverage under the anniversary of the Policy $1,000 of term insurance $1,000 of term insurance term benefit /1, 2/ amount amount Highest and Lowest Charge Lowest: $0.02 per $1,000 Lowest: $0.04 per $1,000 Among All Possible of term insurance amount of term insurance amount Insureds Charge for male, issue $0.114 per $1,000 of term $0.271 per $1,000 of term age 47, nonsmoker, insurance amount insurance amount Guaranteed Issue underwriting class
11
WHEN CHARGE CURRENT AMOUNT MAXIMUM AMOUNT CHARGE IS DEDUCTED DEDUCTED WE CAN DEDUCT ----------------------------------------------------------------------------------------------------------- ----------------------------------------------------------------------------------------------------------- Mortality and Expense On each monthly Effective annual rate of Effective annual rate up Risk Charge /3/ anniversary of the Policy 0.40% of the cash value to 0.90% in the Separate Account. We intend to reduce this charge after Policy year 9 to 0.20% and after Policy year 20 to 0.10%. ----------------------------------------------------------------------------------------------------------- Loan Interest Spread/ 4/ Annually (or on loan Annual rate of 0.25% of Annual rate of 2% of the termination, if earlier) the loan amount loan amount
-------- /1/ The cost of term insurance charge varies based on anticipated variations in our costs or risks associated with the group or individuals in the group that the charge was intended to cover. See "Charges and Deductions--Cost of Term Insurance" for a more detailed discussion of factors affecting this charge. For Policies issued before January 1, 2009, the maximum cost of insurance charge ranges from $0.09 to $30.45 per $1,000 of term insurance amount. /2/ This charge varies based on individual characteristics of the insured or of individuals in the group that the charge was intended to cover, and may not be representative of the charge that you will pay. You can obtain more information about the charges that would apply by contacting your insurance sales representative. If you would like, we will provide you with an illustration of the impact of these and other charges under the Policy, based on various assumptions. /3/ We are waiving the following amounts of the Mortality and Expense Risk Charge: 0.08% for the investment division investing in the WMC Large Cap Research Portfolio; and an amount equal to the underlying portfolio expenses that are in excess of 0.91% for the investment division investing in the Pioneer Fund Portfolio (Class A), in excess of 1.34% for the investment division investing in the Met/Artisan Mid Cap Value Portfolio (Class B), in excess of 1.15% for the investment division investing in the Third Avenue Small Cap Value Portfolio (Class B), and in excess of 0.62% for the investment division investing in the Oppenheimer Global Equity Portfolio (Class A). /4/ We charge interest on Policy loans but credit you with interest on the amount of the cash value we hold as collateral for the loan. The loan interest spread is the excess of the interest rate we charge over the interest rate we credit. PORTFOLIO OPERATING EXPENSES Each of the Funds pays an investment management fee to its investment manager. Each of the Funds also incurs other direct expenses (see the applicable Fund Prospectus and the Statement of Additional Information referred to therein for each Fund). You bear indirectly your proportionate share of the fees and expenses of the Portfolios of each Fund that correspond to the Separate Account investment divisions you are using. Most of the Funds offer various classes of shares, each of which has a different level of expenses, only one of which is available under a Policy. The available class of each Portfolio is specified in the expense table below and on the front cover pages of the Prospectus. The first table below shows the lowest and highest fees and expenses charged by any of the Portfolios for the fiscal year ended December 31, 2013.
LOWEST HIGHEST ----------------------------------------------------------------- Total Annual Portfolio Operating Expenses (expenses that are deducted from Portfolio assets, including management fees, distribution (Rule 12b-1) fees and other expenses) 0.27% 1.71% -----------------------------------------------------------------
12 The table below describes the annual operating expenses for each Portfolio for the year ended December 31, 2013 as a percentage of the Portfolio's average daily net assets for the year.
--------------------------------------------------------------------------------- DISTRIBU- TION FEE WAIVER NET AND/OR ACQUIRED TOTAL AND/OR TOTAL MANAGE- SERVICE FUND ANNUAL EXPENSE ANNUAL MENT (12B-1) OTHER FEES AND OPERATING REIMBUR- OPERATING FEE FEES EXPENSES EXPENSES EXPENSES SEMENT EXPENSES --------------------------------------------------------------------------------- AIM VARIABLE INSURANCE FUNDS (INVESCO VARIABLE INSURANCE FUNDS) --------------------------------------------------------------------------------- Invesco V.I. Comstock Fund-- Series II 0.56% 0.25% 0.28% -- 1.09% 0.06% 1.03% --------------------------------------------------------------------------------- Invesco V.I. Government Securities Fund-- Series II 0.46% 0.25% 0.30% -- 1.01% -- 1.01% --------------------------------------------------------------------------------- Invesco V.I. International Growth Fund-- Series I 0.71% -- 0.31% 0.01% 1.03% 0.01% 1.02% --------------------------------------------------------------------------------- ALLIANCE BERNSTEIN VARIABLE PRODUCTS SERIES FUND, INC. --------------------------------------------------------------------------------- Global Thematic Growth Portfolio-- Class B 0.75% 0.25% 0.23% -- 1.23% -- 1.23% --------------------------------------------------------------------------------- Intermediate Bond Portfolio-- Class B 0.45% 0.25% 0.32% -- 1.02% -- 1.02% --------------------------------------------------------------------------------- International Value Portfolio-- Class A 0.75% -- 0.07% -- 0.82% -- 0.82% --------------------------------------------------------------------------------- AMERICAN CENTURY VARIABLE PORTFOLIOS, INC.--CLASS I --------------------------------------------------------------------------------- VP Capital Appreciation Fund 0.99% -- 0.01% -- 1.00% -- 1.00% --------------------------------------------------------------------------------- AMERICAN FUNDS INSURANCE SERIES(R)-- CLASS 2 --------------------------------------------------------------------------------- American Funds Growth Fund 0.33% 0.25% 0.02% -- 0.60% -- 0.60% ---------------------------------------------------------------------------------
13
----------------------------------------------------------------------------------- DISTRIBU- TION FEE WAIVER NET AND/OR ACQUIRED TOTAL AND/OR TOTAL MANAGE- SERVICE FUND ANNUAL EXPENSE ANNUAL MENT (12B-1) OTHER FEES AND OPERATING REIMBUR- OPERATING FEE FEES EXPENSES EXPENSES EXPENSES SEMENT EXPENSES ----------------------------------------------------------------------------------- American Funds High- Income Bond Fund 0.46% 0.25% 0.02% -- 0.73% -- 0.73% ----------------------------------------------------------------------------------- American Funds International Fund 0.49% 0.25% 0.05% -- 0.79% -- 0.79% ----------------------------------------------------------------------------------- American Funds U.S. Government/ AAA-Rated Securities Fund 0.33% 0.25% 0.02% -- 0.60% -- 0.60% ----------------------------------------------------------------------------------- DREYFUS VARIABLE INVESTMENT FUND-- SERVICE SHARES ----------------------------------------------------------------------------------- International Value Portfolio 1.00% 0.25% 0.25% -- 1.50% -- 1.50% ----------------------------------------------------------------------------------- FIDELITY(R) VARIABLE INSURANCE PRODUCTS ----------------------------------------------------------------------------------- Asset Manager: Growth(R) Portfolio-- Service Class 0.55% 0.10% 0.18% -- 0.83% -- 0.83% ----------------------------------------------------------------------------------- Contrafund(R) Portfolio-- Service Class 0.55% 0.10% 0.09% -- 0.74% -- 0.74% ----------------------------------------------------------------------------------- Equity-Income Portfolio-- Service Class 0.45% 0.10% 0.10% 0.02% 0.67% -- 0.67% ----------------------------------------------------------------------------------- Freedom 2010 Portfolio-- Initial Class -- -- -- 0.55% 0.55% -- 0.55% ----------------------------------------------------------------------------------- Freedom 2015 Portfolio-- Initial Class -- -- -- 0.57% 0.57% -- 0.57% ----------------------------------------------------------------------------------- Freedom 2020 Portfolio-- Initial Class -- -- -- 0.58% 0.58% -- 0.58% ----------------------------------------------------------------------------------- Freedom 2025 Portfolio-- Initial Class -- -- -- 0.62% 0.62% -- 0.62% ----------------------------------------------------------------------------------- Freedom 2030 Portfolio-- Initial Class -- -- -- 0.64% 0.64% -- 0.64% ----------------------------------------------------------------------------------- High Income Portfolio-- Initial Class 0.56% -- 0.12% -- 0.68% -- 0.68% -----------------------------------------------------------------------------------
14
----------------------------------------------------------------------------------- DISTRIBU- TION FEE WAIVER NET AND/OR ACQUIRED TOTAL AND/OR TOTAL MANAGE- SERVICE FUND ANNUAL EXPENSE ANNUAL MENT (12B-1) OTHER FEES AND OPERATING REIMBUR- OPERATING FEE FEES EXPENSES EXPENSES EXPENSES SEMENT EXPENSES ----------------------------------------------------------------------------------- Investment Grade Bond Portfolio-- Service Class 0.31% 0.10% 0.11% -- 0.52% -- 0.52% ----------------------------------------------------------------------------------- Mid Cap Portfolio-- Service Class 2 0.55% 0.25% 0.09% -- 0.89% -- 0.89% ----------------------------------------------------------------------------------- FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST ----------------------------------------------------------------------------------- Franklin Mutual Global Discovery VIP Fund--Class 2 0.80% 0.25% 0.17% -- 1.22% -- 1.22% ----------------------------------------------------------------------------------- Templeton Foreign VIP Fund--Class 1 0.64% -- 0.14% -- 0.78% -- 0.78% ----------------------------------------------------------------------------------- Templeton Global Bond VIP Fund-- Class 1 0.46% -- 0.05% -- 0.51% -- 0.51% ----------------------------------------------------------------------------------- GOLDMAN SACHS VARIABLE INSURANCE TRUST-- INSTITUTIONAL SHARES ----------------------------------------------------------------------------------- Goldman Sachs Small Cap Equity Insights Fund 0.75% -- 0.23% -- 0.98% 0.16% 0.82% ----------------------------------------------------------------------------------- JANUS ASPEN SERIES ----------------------------------------------------------------------------------- Balanced Portfolio-- Service Shares 0.55% 0.25% 0.04% -- 0.84% -- 0.84% ----------------------------------------------------------------------------------- Enterprise Portfolio-- Service Shares 0.64% 0.25% 0.05% -- 0.94% -- 0.94% ----------------------------------------------------------------------------------- Forty Portfolio-- Service Shares 0.49% 0.25% 0.07% -- 0.81% -- 0.81% ----------------------------------------------------------------------------------- Janus Portfolio-- Institutional Shares 0.49% -- 0.05% -- 0.54% -- 0.54% ----------------------------------------------------------------------------------- Overseas Portfolio-- Service Shares 0.44% 0.25% 0.07% -- 0.76% -- 0.76% -----------------------------------------------------------------------------------
15
----------------------------------------------------------------------------------- DISTRIBU- TION FEE WAIVER NET AND/OR ACQUIRED TOTAL AND/OR TOTAL MANAGE- SERVICE FUND ANNUAL EXPENSE ANNUAL MENT (12B-1) OTHER FEES AND OPERATING REIMBUR- OPERATING FEE FEES EXPENSES EXPENSES EXPENSES SEMENT EXPENSES ----------------------------------------------------------------------------------- LEGG MASON PARTNERS VARIABLE EQUITY TRUST ----------------------------------------------------------------------------------- Legg Mason Investment Counsel Variable Social Awareness Portfolio 0.71% -- 0.18% -- 0.89% 0.00% 0.89% ----------------------------------------------------------------------------------- MET INVESTORS SERIES TRUST ----------------------------------------------------------------------------------- Clarion Global Real Estate Portfolio-- Class A 0.60% -- 0.05% -- 0.65% -- 0.65% ----------------------------------------------------------------------------------- ClearBridge Aggressive Growth Portfolio-- Class A 0.59% -- 0.02% -- 0.61% 0.00% 0.61% ----------------------------------------------------------------------------------- Harris Oakmark International Portfolio-- Class A 0.77% -- 0.06% -- 0.83% 0.02% 0.81% ----------------------------------------------------------------------------------- Invesco Mid Cap Value Portfolio-- Class A 0.65% -- 0.05% 0.08% 0.78% 0.02% 0.76% ----------------------------------------------------------------------------------- Invesco Small Cap Growth Portfolio-- Class B 0.85% 0.25% 0.02% -- 1.12% 0.02% 1.10% ----------------------------------------------------------------------------------- JPMorgan Small Cap Value Portfolio-- Class A 0.77% -- 0.06% 0.04% 0.87% 0.09% 0.78% ----------------------------------------------------------------------------------- Lord Abbett Bond Debenture Portfolio-- Class A 0.51% -- 0.03% -- 0.54% -- 0.54% ----------------------------------------------------------------------------------- MetLife Asset Allocation 100 Portfolio-- Class B 0.07% 0.25% 0.01% 0.70% 1.03% -- 1.03% ----------------------------------------------------------------------------------- MFS(R) Emerging Markets Equity Portfolio-- Class B 0.87% 0.25% 0.15% -- 1.27% 0.01% 1.26% -----------------------------------------------------------------------------------
16
----------------------------------------------------------------------------------- DISTRIBU- TION FEE WAIVER NET AND/OR ACQUIRED TOTAL AND/OR TOTAL MANAGE- SERVICE FUND ANNUAL EXPENSE ANNUAL MENT (12B-1) OTHER FEES AND OPERATING REIMBUR- OPERATING FEE FEES EXPENSES EXPENSES EXPENSES SEMENT EXPENSES ----------------------------------------------------------------------------------- MFS(R) Research International Portfolio-- Class B 0.68% 0.25% 0.07% -- 1.00% 0.06% 0.94% ----------------------------------------------------------------------------------- Morgan Stanley Mid Cap Growth Portfolio-- Class A 0.64% -- 0.05% -- 0.69% 0.01% 0.68% ----------------------------------------------------------------------------------- Oppenheimer Global Equity Portfolio-- Class A 0.67% -- 0.08% -- 0.75% 0.03% 0.72% ----------------------------------------------------------------------------------- PIMCO Inflation Protected Bond Portfolio-- Class A 0.47% -- 0.08% -- 0.55% 0.00% 0.55% ----------------------------------------------------------------------------------- PIMCO Total Return Portfolio-- Class A 0.48% -- 0.03% -- 0.51% -- 0.51% ----------------------------------------------------------------------------------- Pioneer Fund Portfolio-- Class A 0.65% -- 0.05% -- 0.70% 0.04% 0.66% ----------------------------------------------------------------------------------- T. Rowe Price Large Cap Value Portfolio-- Class A 0.57% -- 0.02% -- 0.59% -- 0.59% ----------------------------------------------------------------------------------- Third Avenue Small Cap Value Portfolio-- Class B 0.73% 0.25% 0.03% -- 1.01% 0.02% 0.99% ----------------------------------------------------------------------------------- WMC Large Cap Research Portfolio-- Class A 0.59% -- 0.03% -- 0.62% 0.05% 0.57% ----------------------------------------------------------------------------------- METROPOLITAN SERIES FUND ----------------------------------------------------------------------------------- Baillie Gifford International Stock Portfolio-- Class A 0.79% -- 0.08% -- 0.87% 0.12% 0.75% ----------------------------------------------------------------------------------- Barclays Aggregate Bond Index Portfolio-- Class A 0.25% -- 0.03% -- 0.28% 0.01% 0.27% ----------------------------------------------------------------------------------- BlackRock Bond Income Portfolio-- Class A 0.33% -- 0.02% -- 0.35% 0.00% 0.35% -----------------------------------------------------------------------------------
17
--------------------------------------------------------------------------------- DISTRIBU- TION FEE WAIVER NET AND/OR ACQUIRED TOTAL AND/OR TOTAL MANAGE- SERVICE FUND ANNUAL EXPENSE ANNUAL MENT (12B-1) OTHER FEES AND OPERATING REIMBUR- OPERATING FEE FEES EXPENSES EXPENSES EXPENSES SEMENT EXPENSES --------------------------------------------------------------------------------- BlackRock Capital Appreciation Portfolio-- Class A 0.69% -- 0.02% -- 0.71% 0.01% 0.70% --------------------------------------------------------------------------------- BlackRock Money Market Portfolio-- Class A 0.33% -- 0.02% -- 0.35% 0.02% 0.33% --------------------------------------------------------------------------------- Frontier Mid Cap Growth Portfolio-- Class A 0.72% -- 0.03% -- 0.75% 0.01% 0.74% --------------------------------------------------------------------------------- Jennison Growth Portfolio-- Class A 0.60% -- 0.02% -- 0.62% 0.07% 0.55% --------------------------------------------------------------------------------- Loomis Sayles Small Cap Core Portfolio-- Class A 0.90% -- 0.05% 0.12% 1.07% 0.07% 1.00% --------------------------------------------------------------------------------- Met/Artisan Mid Cap Value Portfolio-- Class B 0.81% 0.25% 0.02% -- 1.08% -- 1.08% --------------------------------------------------------------------------------- MetLife Asset Allocation 20 Portfolio-- Class B 0.09% 0.25% 0.02% 0.52% 0.88% 0.01% 0.87% --------------------------------------------------------------------------------- MetLife Asset Allocation 40 Portfolio-- Class B 0.07% 0.25% 0.01% 0.57% 0.90% -- 0.90% --------------------------------------------------------------------------------- MetLife Asset Allocation 60 Portfolio-- Class B 0.06% 0.25% -- 0.62% 0.93% -- 0.93% --------------------------------------------------------------------------------- MetLife Asset Allocation 80 Portfolio-- Class B 0.06% 0.25% 0.01% 0.66% 0.98% -- 0.98% --------------------------------------------------------------------------------- MetLife Mid Cap Stock Index Portfolio-- Class A 0.25% -- 0.05% 0.02% 0.32% 0.00% 0.32% --------------------------------------------------------------------------------- MetLife Stock Index Portfolio-- Class A 0.25% -- 0.02% -- 0.27% 0.01% 0.26% --------------------------------------------------------------------------------- MFS(R) Total Return Portfolio-- Class B 0.55% 0.25% 0.04% -- 0.84% -- 0.84% --------------------------------------------------------------------------------- MFS(R) Value Portfolio-- Class A 0.70% -- 0.02% -- 0.72% 0.14% 0.58% ---------------------------------------------------------------------------------
18
----------------------------------------------------------------------------------- DISTRIBU- TION FEE WAIVER NET AND/OR ACQUIRED TOTAL AND/OR TOTAL MANAGE- SERVICE FUND ANNUAL EXPENSE ANNUAL MENT (12B-1) OTHER FEES AND OPERATING REIMBUR- OPERATING FEE FEES EXPENSES EXPENSES EXPENSES SEMENT EXPENSES ----------------------------------------------------------------------------------- MSCI EAFE(R) Index Portfolio-- Class A 0.30% -- 0.10% 0.01% 0.41% 0.00% 0.41% ----------------------------------------------------------------------------------- Neuberger Berman Genesis Portfolio-- Class A 0.80% -- 0.03% -- 0.83% 0.01% 0.82% ----------------------------------------------------------------------------------- Russell 2000(R) Index Portfolio-- Class A 0.25% -- 0.06% 0.11% 0.42% 0.00% 0.42% ----------------------------------------------------------------------------------- T. Rowe Price Large Cap Growth Portfolio-- Class A 0.60% -- 0.03% -- 0.63% 0.01% 0.62% ----------------------------------------------------------------------------------- T. Rowe Price Small Cap Growth Portfolio-- Class A 0.48% -- 0.04% -- 0.52% -- 0.52% ----------------------------------------------------------------------------------- WMC Balanced Portfolio-- Class A 0.46% -- 0.05% -- 0.51% 0.00% 0.51% ----------------------------------------------------------------------------------- WMC Core Equity Opportunities Portfolio-- Class A 0.70% -- 0.02% -- 0.72% 0.11% 0.61% ----------------------------------------------------------------------------------- MFS(R) VARIABLE INSURANCE TRUST-- SERVICE CLASS ----------------------------------------------------------------------------------- MFS(R) Global Equity Series 1.00% 0.25% 0.31% -- 1.56% 0.16% 1.40% ----------------------------------------------------------------------------------- MFS(R) New Discovery Series 0.90% 0.25% 0.06% -- 1.21% -- 1.21% ----------------------------------------------------------------------------------- MFS(R) VARIABLE INSURANCE TRUST II-- SERVICE CLASS ----------------------------------------------------------------------------------- MFS(R) High Yield Portfolio 0.70% 0.25% 0.06% -- 1.01% 0.01% 1.00% ----------------------------------------------------------------------------------- OPPENHEIMER VARIABLE ACCOUNT FUNDS-- NON-SERVICE SHARES ----------------------------------------------------------------------------------- Oppenheimer Main Street Small Cap Fund(R)/VA 0.68% -- 0.13% -- 0.81% 0.01% 0.80% -----------------------------------------------------------------------------------
19
----------------------------------------------------------------------------------- DISTRIBU- TION FEE WAIVER NET AND/OR ACQUIRED TOTAL AND/OR TOTAL MANAGE- SERVICE FUND ANNUAL EXPENSE ANNUAL MENT (12B-1) OTHER FEES AND OPERATING REIMBUR- OPERATING FEE FEES EXPENSES EXPENSES EXPENSES SEMENT EXPENSES ----------------------------------------------------------------------------------- PIMCO VARIABLE INSURANCE TRUST-- ADMINISTRATIVE CLASS ----------------------------------------------------------------------------------- PIMCO All Asset Portfolio 0.43% 0.15% -- 0.76% 1.34% 0.12% 1.22% ----------------------------------------------------------------------------------- PIMCO Commodity RealReturn(R) Strategy Portfolio 0.74% 0.15% 0.08% 0.12% 1.09% 0.12% 0.97% ----------------------------------------------------------------------------------- PIMCO Long- Term U.S. Government Portfolio 0.48% 0.15% 0.03% -- 0.66% -- 0.66% ----------------------------------------------------------------------------------- PIMCO Low Duration Portfolio 0.50% 0.15% -- -- 0.65% -- 0.65% ----------------------------------------------------------------------------------- PIONEER VARIABLE CONTRACTS TRUST-- CLASS I ----------------------------------------------------------------------------------- Pioneer Mid Cap Value VCT Portfolio 0.65% -- 0.06% -- 0.71% -- 0.71% ----------------------------------------------------------------------------------- PUTNAM VARIABLE TRUST-- CLASS IB ----------------------------------------------------------------------------------- Putnam VT International Value Fund 0.70% 0.25% 0.23% -- 1.18% -- 1.18% ----------------------------------------------------------------------------------- ROYCE CAPITAL FUND-- INVESTMENT CLASS ----------------------------------------------------------------------------------- Royce Micro- Cap Portfolio 1.25% -- 0.07% 0.02% 1.34% -- 1.34% ----------------------------------------------------------------------------------- Royce Small- Cap Portfolio 1.00% -- 0.05% -- 1.05% -- 1.05% ----------------------------------------------------------------------------------- THE UNIVERSAL INSTITUTIONAL FUNDS, INC.-- CLASS I ----------------------------------------------------------------------------------- Emerging Markets Debt Portfolio 0.75% -- 0.31% -- 1.06% -- 1.06% ----------------------------------------------------------------------------------- Emerging Markets Equity Portfolio 1.25% -- 0.46% -- 1.71% 0.29% 1.42% -----------------------------------------------------------------------------------
20
------------------------------------------------------------------------------- DISTRIBU- TION FEE WAIVER NET AND/OR ACQUIRED TOTAL AND/OR TOTAL MANAGE- SERVICE FUND ANNUAL EXPENSE ANNUAL MENT (12B-1) OTHER FEES AND OPERATING REIMBUR- OPERATING FEE FEES EXPENSES EXPENSES EXPENSES SEMENT EXPENSES ------------------------------------------------------------------------------- WELLS FARGO VARIABLE TRUST -- CLASS 2 ------------------------------------------------------------------------------- VT Total Return Bond Fund 0.40% 0.25% 0.28% 0.01% 0.94% 0.03% 0.91% -------------------------------------------------------------------------------
The information shown in the table above was provided by the Portfolios and we have not independently verified that information. Net Total Annual Operating Expenses shown in the table reflect any current fee waiver or expense reimbursement arrangement that will remain in effect for a period of at least one year from the date of the Portfolio's 2014 prospectus. "0.00%" in the Fee Waiver and/or Expense Reimbursement column indicates that there is such an arrangement in effect for the Portfolio, but that the expenses of the Portfolio are below the level that would trigger the waiver or reimbursement. Fee waiver and expense reimbursement arrangements with a duration of less than one year, or arrangements that may be terminated without the consent of the Portfolio's board of directors or trustees, are not shown. Certain Portfolios that have "Acquired Fund Fees and Expenses" are "funds of funds." A fund of funds invests substantially all of its assets in other underlying funds. Because the Portfolio invests in other funds, it will bear its pro rata portion of the operating expenses of those underlying funds, including the management fee. Additional information about the management fees and expenses of the Funds can be obtained in Funds' prospectuses and Statements of Additional Information. FOR INFORMATION CONCERNING COMPENSATION PAID FOR THE SALE OF THE POLICIES, SEE "SALE OF POLICIES." METLIFE Metropolitan Life Insurance Company ("MetLife") is a wholly-owned subsidiary of MetLife, Inc., a publicly traded company. Our main office is located at 200 Park Avenue, New York, New York 10166. MetLife has the legal obligation to pay all benefits and other amounts to which you are entitled under the terms of your Policy. THE FIXED ACCOUNT The Fixed Account is part of our general assets that are not in any legally segregated separate accounts. Amounts in the Fixed Account are credited with interest at an effective annual rate of 2.5% (4% for Policies issued prior to February 24, 2012). We may also credit excess interest on such amounts. Different excess interest rates may apply to different amounts based upon when such amounts were allocated to the Fixed Account. 21 Any partial amounts we remove from the Fixed Account (such as any portion of your Policy's monthly deduction that is allocable to the Fixed Account) will be taken from the most recently allocated amounts first. Any excess interest rate will be credited for at least 12 months before a new rate is credited. We can delay transfers, withdrawals, surrender and payment of Policy loans from the Fixed Account for up to 6 months. Since the Fixed Account is not registered under the federal securities laws, this Prospectus contains only limited information about the Fixed Account. The Policy gives you more information on the operation of the Fixed Account. SEPARATE ACCOUNT UL The Separate Account receives premium payments from the Policy described in this Prospectus and other variable life insurance policies that we issue. The assets in the Separate Account legally belong to us, but they are held solely for the benefit of investors in the Separate Account and no one else, including our other creditors. Income and realized and unrealized capital gains and losses of the Separate Account are credited to the Separate Account without regard to any of our other income or capital gains and losses. We will keep an amount in the Separate Account that at least equals the value of our commitments to policy owners that are based on their investments in the Separate Account. We can also keep charges that we deduct and other excess amounts in the Separate Account or we can transfer the excess out of the Separate Account. We are obligated to pay the death benefit under the Policy even if that amount exceeds the Policy's cash value in the Separate Account. The amount of the death benefit that exceeds the Policy's cash value in the Separate Account is paid from our general account. Death benefits paid from the general account are subject to the financial strength and claims-paying ability of the Company. For other life insurance policies and annuity contracts that we issue, we pay all amounts owed under the policies and contracts from the general account. MetLife is regulated as an insurance company under state law, which generally imposes restrictions on the amount and type of investments in the general account. However, there is no guarantee that we will be able to meet our claims-paying obligations. There are risks to purchasing any insurance product. The investment adviser to certain of the Portfolios offered with the Policy or with other variable life insurance policies issued through the Separate Account may be regulated as Commodity Pool Operators. While it does not concede that the Separate Account is a commodity pool, MetLife has claimed an exclusion from the definition of the term "commodity pool operator" under the Commodities Exchange Act ("CEA"), and is not subject to registration or regulation as a pool operator under the CEA. [SIDEBAR: EACH SEPARATE ACCOUNT INVESTMENT DIVISION INVESTS IN A CORRESPONDING PORTFOLIO OF A FUND.] The Separate Account has subdivisions, called "investment divisions." Each investment division invests its assets exclusively in shares of a corresponding Portfolio of a Fund. We can add new investment divisions to or eliminate investment divisions from the Separate Account. You can designate how you would like your net premiums and cash value to be allocated among the available investment divisions and our Fixed Account. Amounts you allocate to each investment division receive the investment experience of the investment division, and you bear this investment risk. 22 THE FUNDS [SIDEBAR: YOU SHOULD CAREFULLY REVIEW THE INVESTMENT OBJECTIVES, STRATEGIES, AND RISKS OF EACH PORTFOLIO WHICH ARE DESCRIBED IN THE PROSPECTUS FOR EACH FUND YOU HAVE ALSO RECEIVED.] Each of the Funds is a "series" type of mutual fund, which is registered as an open-end management investment company under the Investment Company Act of 1940 (the "1940 Act"). Each Fund is divided into Portfolios, each of which represents a different class of stock in which a corresponding investment division of the Separate Account invests. PROSPECTUSES FOR THE FUNDS ARE AVAILABLE BY CALLING 1-908-253-1400 OR THROUGH YOUR REGISTERED REPRESENTATIVE. You should read each Fund prospectus carefully. They contain information about each Fund and its Portfolios, including the investment objectives, strategies, risks and investment advisers that are associated with each Portfolio. Some of the Portfolios have names and investment objectives that are very similar to certain publicly available mutual funds that are managed by the same money managers. These Portfolios are not those publicly available mutual funds and will not have the same performance. Different performance will result from such factors as different implementation of investment policies, different cash flows into and out of the Portfolios, different fees and different sizes. CERTAIN PAYMENTS WE RECEIVE WITH REGARD TO THE PORTFOLIOS. An investment adviser (other than our affiliate MetLife Advisers, LLC) or sub-adviser of a Portfolio or its affiliates, may make payments to us and/or certain of our affiliates. These payments may be used for a variety of purposes, including payment for expenses for certain administrative, marketing and support services with respect to the Policies and, in MetLife's role as intermediary, with respect to the Portfolios. We and our affiliates may profit from these payments. These payments may be derived, in whole or in part, from the advisory fee deducted from Portfolio assets. Policy owners, through their indirect investment in the Portfolios, bear the costs of these advisory fees (see the Fund prospectuses for more information). The amount of the payments we receive is based on a percentage of assets of the Portfolio attributable to the Policies and certain other variable insurance products that we and our affiliates issue. These percentages differ and some advisers or sub-advisers (or other affiliates) may pay us more than others. These percentages currently range up to .50%. Additionally, an investment adviser (other than our affiliate MetLife Advisers, LLC) or sub-adviser of a Portfolio or its affiliates may provide us with wholesaling services that assist in the distribution of the Policies and may pay us and/or certain of our affiliates amounts to participate in sales meetings. These amounts may be significant and may provide the adviser or sub-adviser (or their affiliate) with increased access to persons involved in the distribution of the Policies. We, and certain of our affiliated insurance companies, have joint ownership interests in our affiliated investment adviser MetLife Advisers, LLC, which is organized as a limited liability company. Our ownership interests in MetLife Advisers, LLC entitle us to profit distributions if the adviser makes a profit with respect to the advisory fees it receives from a Portfolio. We will benefit accordingly from assets allocated to the Portfolios to the extent they result in profits to the adviser. (See "Fee Tables--Portfolio Operating Expenses" for information on the management fees paid to the adviser and the Statement of Additional Information for the Funds for information on the management fees paid by the adviser to sub-advisers.) 23 Certain Funds have adopted a Distribution Plan under Rule 12b-1 of the Investment Company Act of 1940. A Fund's 12b-1 Plan, if any, is described in more detail in each Fund's prospectus. (See also "Fee Tables--Portfolio Operating Expenses.") Any payments we receive pursuant to those 12b-1 Plans are paid to us or our distributor. Payments under a Fund's 12b-1 Plan decrease the Portfolio's investment return. SELECTION OF THE PORTFOLIOS. We select the Portfolios offered through this Policy based on a number of criteria, including asset class coverage, the strength of the adviser's or subadviser's reputation and tenure, brand recognition, performance, and the capability and qualification of each investment firm. Another factor we consider during the selection process is whether the Portfolio's adviser or subadviser is one of our affiliates or whether the Portfolio, its adviser, its subadviser(s), or an affiliate will make payments to us or our affiliates. For additional information on these arrangements, see "Certain Payments We Receive with Regard to the Portfolios" above. In this regard, the profit distributions we receive from our affiliated investment advisers are a component of the total revenue that we consider in configuring the features and investment choices available in the variable insurance products that we and our affiliated insurance companies issue. Since we and our affiliated insurance companies may benefit more from the allocation of assets to Portfolios advised by our affiliates than those that are not, we may be more inclined to offer Portfolios advised by our affiliates in the variable insurance products we issue. In some cases, we may include Portfolios based on recommendations made by selling firms through which the Policy is sold. These selling firms may receive payments from the Portfolios they recommend and may benefit accordingly from the allocation of cash value to such Portfolios. We review the Portfolios periodically and may remove a Portfolio or limit its availability to new premium payments or transfers of cash value if we determine that the Portfolio no longer meets one or more of the selection criteria, and/or if the Portfolio has not attracted significant allocations from owners. We make certain payments to American Funds Distributors, Inc., principal underwriter for the American Funds Insurance Series. (See "Sales of Policies.") WE DO NOT PROVIDE INVESTMENT ADVICE AND DO NOT RECOMMEND OR ENDORSE ANY PARTICULAR PORTFOLIO. YOU BEAR THE RISK OF ANY DECLINE IN THE CASH VALUE OF YOUR POLICY RESULTING FROM THE PERFORMANCE OF THE PORTFOLIOS YOU HAVE CHOSEN. As of the end of each Valuation Period (see "Valuation Period" description below in "Other Policy Provisions--When Your Requests Become Effective"), we purchase and redeem Fund shares for the Separate Account at their net asset value without any sales or redemption charges. These purchases and redemptions reflect the amount of any of the following transactions that take effect at the end of the Valuation Period: .. The allocation of net premiums to the Separate Account. .. Dividends and distributions on Fund shares, which are reinvested as of the dates paid (which reduces the value of each share of the Fund and increases the number of Fund shares outstanding, but has no effect on the cash value in the Separate Account). .. Policy loans and loan repayments allocated to the Separate Account. .. Transfers to and among investment divisions. .. Withdrawals and surrenders taken from the Separate Account. 24 The adviser, any sub-adviser and investment objective of each Portfolio are as follows: AIM VARIABLE INSURANCE FUNDS (INVESCO VARIABLE INSURANCE FUNDS) ---------------------------------------------------------------------------------------------------- INVESTMENT ADVISER/ PORTFOLIO INVESTMENT OBJECTIVE SUBADVISER ---------------------------------------------------------------------------------------------------- Invesco V.I. Comstock Fund--Series II Seeks capital growth and income Invesco Advisers, Inc. through investments in equity securities, including common stocks, preferred stocks and securities convertible into common and preferred stocks. ---------------------------------------------------------------------------------------------------- Invesco V.I. Government Securities Seeks total return, comprised of Invesco Advisers, Inc. Fund--Series II current income and capital appreciation. ---------------------------------------------------------------------------------------------------- Invesco V.I. International Growth Seeks long-term growth of capital. Invesco Advisers, Inc. Fund--Series I ---------------------------------------------------------------------------------------------------- ALLIANCEBERNSTEIN VARIABLE PRODUCTS SERIES FUND, INC. ---------------------------------------------------------------------------------------------------- INVESTMENT ADVISER/ PORTFOLIO INVESTMENT OBJECTIVE SUBADVISER ---------------------------------------------------------------------------------------------------- Global Thematic Growth Seeks long-term growth of capital. AllianceBernstein L.P. Portfolio--Class B ---------------------------------------------------------------------------------------------------- ---------------------------------------------------------------------------------------------------- Intermediate Bond Portfolio--Class B Seeks to generate income and price AllianceBernstein L.P. appreciation without assuming what the Adviser considers undue risk. ---------------------------------------------------------------------------------------------------- ---------------------------------------------------------------------------------------------------- International Value Portfolio--Class A Seeks long-term growth of capital. AllianceBernstein L.P. ---------------------------------------------------------------------------------------------------- AMERICAN CENTURY VARIABLE PORTFOLIOS, INC.--CLASS I ---------------------------------------------------------------------------------------------------- INVESTMENT ADVISER/ PORTFOLIO INVESTMENT OBJECTIVE SUBADVISER ---------------------------------------------------------------------------------------------------- VP Capital Appreciation Fund Seeks capital growth. American Century Investment Management, Inc. ---------------------------------------------------------------------------------------------------- AMERICAN FUNDS INSURANCE SERIES(R)--CLASS 2 ---------------------------------------------------------------------------------------------------- INVESTMENT ADVISER/ PORTFOLIO INVESTMENT OBJECTIVE SUBADVISER ---------------------------------------------------------------------------------------------------- American Funds Growth Fund Seeks growth of capital. Capital Research and Management Company ---------------------------------------------------------------------------------------------------- ---------------------------------------------------------------------------------------------------- American Funds High-Income Bond Fund Seeks a high level of current income. Capital Research and Its secondary objective is capital Management Company appreciation. ---------------------------------------------------------------------------------------------------- ---------------------------------------------------------------------------------------------------- American Funds International Fund Seeks long-term growth of capital. Capital Research and Management Company ---------------------------------------------------------------------------------------------------- ---------------------------------------------------------------------------------------------------- American Funds U.S. Seeks a high level of current income Capital Research and Government/AAA-Rated Securities Fund consistent with preservation of Management Company capital. ----------------------------------------------------------------------------------------------------
25 DREYFUS VARIABLE INVESTMENT FUND--SERVICE SHARES ------------------------------------------------------------------------------------------------------- INVESTMENT ADVISER/ PORTFOLIO INVESTMENT OBJECTIVE SUBADVISER ------------------------------------------------------------------------------------------------------- International Value Portfolio Seeks long-term capital growth. The Dreyfus Corporation ------------------------------------------------------------------------------------------------------- FIDELITY(R) VARIABLE INSURANCE PRODUCTS ------------------------------------------------------------------------------------------------------- INVESTMENT ADVISER/ PORTFOLIO INVESTMENT OBJECTIVE SUBADVISER ------------------------------------------------------------------------------------------------------- Asset Manager: Growth(R) Seeks to maximize total return by Fidelity Management & Portfolio--Service Class allocating its assets among stocks, Research Company bonds, short-term instruments, and Subadviser: FMR Co., Inc. other investments. Fidelity Investments Money Management, Inc. ------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------- Contrafund(R) Portfolio-- Service Seeks long-term capital appreciation. Fidelity Management & Class Research Company Subadviser: FMR Co., Inc. ------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------- Equity-Income Portfolio--Service Class Seeks reasonable income. The fund Fidelity Management & will also consider the potential for Research Company capital appreciation. The fund's goal Subadviser: FMR Co., Inc. is to achieve a yield which exceeds the composite yield on the securities comprising the S&P 500(R) Index. ------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------- Freedom 2010 Portfolio-- Initial Class Seeks high total return with a Strategic Advisers, Inc. secondary objective of principal preservation as the fund approaches its target date and beyond. ------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------- Freedom 2015 Portfolio-- Initial Class Seeks high total return with a Strategic Advisers, Inc. secondary objective of principal preservation as the fund approaches its target date and beyond. ------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------- Freedom 2020 Portfolio-- Initial Class Seeks high total return with a Strategic Advisers, Inc. secondary objective of principal preservation as the fund approaches its target date and beyond. ------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------- Freedom 2025 Portfolio-- Initial Class Seeks high total return with a Strategic Advisers, Inc. secondary objective of principal preservation as the fund approaches its target date and beyond. ------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------- Freedom 2030 Portfolio-- Initial Class Seeks high total return with a Strategic Advisers, Inc. secondary objective of principal preservation as the fund approaches its target date and beyond. ------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------- High Income Portfolio-- Initial Class Seeks a high level of current income, Fidelity Management & while also considering growth of Research Company capital. Subadviser: FMR Co., Inc. ------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------- Investment Grade Bond Seeks as high a level of current Fidelity Management & Portfolio--Service Class income as is consistent with the Research Company preservation of capital. Subadviser: Fidelity Investments Money Management, Inc. -------------------------------------------------------------------------------------------------------
26
--------------------------------------------------------------------------------------------------------- INVESTMENT ADVISER/ PORTFOLIO INVESTMENT OBJECTIVE SUBADVISER --------------------------------------------------------------------------------------------------------- Mid Cap Portfolio-- Service Class 2 Seeks long-term growth of capital. Fidelity Management & Research Company Subadviser: FMR Co., Inc. --------------------------------------------------------------------------------------------------------- FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST --------------------------------------------------------------------------------------------------------- INVESTMENT ADVISER/ PORTFOLIO INVESTMENT OBJECTIVE SUBADVISER --------------------------------------------------------------------------------------------------------- Franklin Mutual Global Discovery VIP Seeks capital appreciation. Franklin Mutual Advisers, Fund--Class 2 LLC --------------------------------------------------------------------------------------------------------- --------------------------------------------------------------------------------------------------------- Templeton Foreign VIP Fund--Class 1 Seeks long-term capital growth. Templeton Investment Counsel, LLC --------------------------------------------------------------------------------------------------------- --------------------------------------------------------------------------------------------------------- Templeton Global Bond VIP Fund--Class Seeks high current income, consistent Franklin Advisers, Inc. 1 with preservation of capital, with capital appreciation as a secondary consideration. --------------------------------------------------------------------------------------------------------- GOLDMAN SACHS VARIABLE INSURANCE TRUST--INSTITUTIONAL SHARES --------------------------------------------------------------------------------------------------------- INVESTMENT ADVISER/ PORTFOLIO INVESTMENT OBJECTIVE SUBADVISER --------------------------------------------------------------------------------------------------------- Goldman Sachs Small Cap Equity Seeks long-term growth of capital. Goldman Sachs Asset Insights Fund Management, L.P. --------------------------------------------------------------------------------------------------------- JANUS ASPEN SERIES --------------------------------------------------------------------------------------------------------- INVESTMENT ADVISER/ PORTFOLIO INVESTMENT OBJECTIVE SUBADVISER --------------------------------------------------------------------------------------------------------- Balanced Portfolio--Service Shares Seeks long-term capital growth, Janus Capital consistent with preservation of Management LLC capital and balanced by current income. --------------------------------------------------------------------------------------------------------- --------------------------------------------------------------------------------------------------------- Enterprise Portfolio--Service Shares Seeks long-term growth of capital. Janus Capital Management LLC --------------------------------------------------------------------------------------------------------- --------------------------------------------------------------------------------------------------------- Forty Portfolio--Service Shares Seeks long-term growth of capital. Janus Capital Management LLC --------------------------------------------------------------------------------------------------------- --------------------------------------------------------------------------------------------------------- Janus Portfolio--Institutional Shares Seeks long-term growth of capital. Janus Capital Management LLC --------------------------------------------------------------------------------------------------------- --------------------------------------------------------------------------------------------------------- Overseas Portfolio--Service Shares Seeks long-term growth of capital. Janus Capital Management LLC --------------------------------------------------------------------------------------------------------- LEGG MASON PARTNERS VARIABLE EQUITY TRUST --------------------------------------------------------------------------------------------------------- INVESTMENT ADVISER/ PORTFOLIO INVESTMENT OBJECTIVE SUBADVISER --------------------------------------------------------------------------------------------------------- Legg Mason Investment Counsel Seeks capital appreciation and Legg Mason Partners Variable Social Awareness Portfolio retention of net investment income. Fund Advisor, LLC Subadviser: Legg Mason Investment Counsel, LLC --------------------------------------------------------------------------------------------------------- MET INVESTORS SERIES TRUST --------------------------------------------------------------------------------------------------------- INVESTMENT ADVISER/ PORTFOLIO INVESTMENT OBJECTIVE SUBADVISER --------------------------------------------------------------------------------------------------------- Clarion Global Real Estate Seeks total return through investment MetLife Advisers, LLC Portfolio--Class A in real estate securities, Subadviser: CBRE emphasizing both capital appreciation Clarion Securities LLC and current income. ---------------------------------------------------------------------------------------------------------
27
------------------------------------------------------------------------------------------------------- INVESTMENT ADVISER/ PORTFOLIO INVESTMENT OBJECTIVE SUBADVISER ------------------------------------------------------------------------------------------------------- ClearBridge Aggressive Growth Seeks capital appreciation. MetLife Advisers, LLC Portfolio--Class A Subadviser: ClearBridge Investments, LLC ------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------- Harris Oakmark International Seeks long-term capital appreciation. MetLife Advisers, LLC Portfolio--Class A Subadviser: Harris Associates L.P. ------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------- Invesco Mid Cap Value Seeks high total return by investing MetLife Advisers, LLC Portfolio--Class A in equity securities of mid-sized Subadviser: Invesco companies. Advisers, Inc. ------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------- Invesco Small Cap Growth Seeks long-term growth of capital. MetLife Advisers, LLC Portfolio--Class B Subadviser: Invesco Advisers, Inc. ------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------- JPMorgan Small Cap Value Seeks long-term growth of capital. MetLife Advisers, LLC Portfolio--Class A Subadviser: J.P. Morgan Investment Management Inc. ------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------- Lord Abbett Bond Debenture Seeks high current income and the MetLife Advisers, LLC Portfolio--Class A opportunity for capital appreciation Subadviser: Lord, Abbett to produce a high total return. & Co. LLC ------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------- MetLife Asset Allocation 100 Seeks growth of capital. MetLife Advisers, LLC Portfolio--Class B ------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------- MFS(R) Emerging Markets Equity Seeks capital appreciation. MetLife Advisers, LLC Portfolio--Class B Subadviser: Massachusetts Financial Services Company ------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------- MFS(R) Research International Seeks capital appreciation. MetLife Advisers, LLC Portfolio--Class B Subadviser: Massachusetts Financial Services Company ------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------- Morgan Stanley Mid Cap Growth Seeks capital appreciation. MetLife Advisers, LLC Portfolio--Class A Subadviser: Morgan Stanley Investment Management Inc. ------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------- Oppenheimer Global Equity Seeks capital appreciation. MetLife Advisers, LLC Portfolio--Class A Subadviser: OppenheimerFunds, Inc. ------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------- PIMCO Inflation Protected Bond Seeks maximum real return, consistent MetLife Advisers, LLC Portfolio--Class A with preservation of capital and Subadviser: Pacific prudent investment management. Investment Management Company LLC ------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------- PIMCO Total Return Portfolio--Class A Seeks maximum total return, MetLife Advisers, LLC consistent with the preservation of Subadviser: Pacific capital and prudent investment Investment Management management. Company LLC ------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------- Pioneer Fund Portfolio--Class A Seeks reasonable income and capital MetLife Advisers, LLC growth. Subadviser: Pioneer Investment Management, Inc. ------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------- T. Rowe Price Large Cap Value Seeks long-term capital appreciation MetLife Advisers, LLC Portfolio--Class A by investing in common stocks Subadviser: T. Rowe Price believed to be undervalued. Income is Associates, Inc. a secondary objective. ------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------- Third Avenue Small Cap Value Seeks long-term capital appreciation. MetLife Advisers, LLC Portfolio--Class B Subadviser: Third Avenue Management LLC -------------------------------------------------------------------------------------------------------
28
----------------------------------------------------------------------------------------------------------- INVESTMENT ADVISER/ PORTFOLIO INVESTMENT OBJECTIVE SUBADVISER ----------------------------------------------------------------------------------------------------------- WMC Large Cap Research Seeks long-term capital appreciation. MetLife Advisers, LLC Portfolio--Class A Subadviser: Wellington Management Company, LLP ----------------------------------------------------------------------------------------------------------- METROPOLITAN SERIES FUND ----------------------------------------------------------------------------------------------------------- Baillie Gifford International Stock Seeks long-term growth of capital. MetLife Advisers, LLC Portfolio--Class A Subadviser: Baillie Gifford Overseas Limited ----------------------------------------------------------------------------------------------------------- ----------------------------------------------------------------------------------------------------------- Barclays Aggregate Bond Index Seeks to track the performance of the MetLife Advisers, LLC Portfolio--Class A Barclays U.S. Aggregate Bond Index. Subadviser: MetLife Investment Management, LLC ----------------------------------------------------------------------------------------------------------- ----------------------------------------------------------------------------------------------------------- BlackRock Bond Income Seeks a competitive total return MetLife Advisers, LLC Portfolio--Class A primarily from investing in Subadviser: BlackRock fixed-income securities. Advisors, LLC ----------------------------------------------------------------------------------------------------------- ----------------------------------------------------------------------------------------------------------- BlackRock Capital Appreciation Seeks long-term growth of capital. MetLife Advisers, LLC Portfolio--Class A Subadviser: BlackRock Advisors, LLC ----------------------------------------------------------------------------------------------------------- ----------------------------------------------------------------------------------------------------------- BlackRock Money Market Seeks a high level of current income MetLife Advisers, LLC Portfolio--Class A consistent with preservation of Subadviser: BlackRock capital. Advisors, LLC ----------------------------------------------------------------------------------------------------------- ----------------------------------------------------------------------------------------------------------- Frontier Mid Cap Growth Seeks maximum capital appreciation. MetLife Advisers, LLC Portfolio--Class A Subadviser: Frontier Capital Management Company, LLC ----------------------------------------------------------------------------------------------------------- ----------------------------------------------------------------------------------------------------------- Jennison Growth Portfolio--Class A Seeks long-term growth of capital. MetLife Advisers, LLC Subadviser: Jennison Associates LLC ----------------------------------------------------------------------------------------------------------- ----------------------------------------------------------------------------------------------------------- Loomis Sayles Small Cap Core Seeks long-term capital growth from MetLife Advisers, LLC Portfolio--Class A investments in common stocks or other Subadviser: Loomis, equity securities. Sayles & Company, L.P. ----------------------------------------------------------------------------------------------------------- ----------------------------------------------------------------------------------------------------------- Met/Artisan Mid Cap Value Seeks long-term capital growth. MetLife Advisers, LLC Portfolio--Class B Subadviser: Artisan Partners Limited Partnership ----------------------------------------------------------------------------------------------------------- ----------------------------------------------------------------------------------------------------------- MetLife Asset Allocation 20 Seeks a high level of current income, MetLife Advisers, LLC Portfolio--Class B with growth of capital as a secondary objective. ----------------------------------------------------------------------------------------------------------- ----------------------------------------------------------------------------------------------------------- MetLife Asset Allocation 40 Seeks high total return in the form MetLife Advisers, LLC Portfolio--Class B of income and growth of capital, with a greater emphasis on income. ----------------------------------------------------------------------------------------------------------- ----------------------------------------------------------------------------------------------------------- MetLife Asset Allocation 60 Seeks a balance between a high level MetLife Advisers, LLC Portfolio--Class B of current income and growth of capital, with a greater emphasis on growth of capital. ----------------------------------------------------------------------------------------------------------- ----------------------------------------------------------------------------------------------------------- MetLife Asset Allocation 80 Seeks growth of capital. MetLife Advisers, LLC Portfolio--Class B ----------------------------------------------------------------------------------------------------------- ----------------------------------------------------------------------------------------------------------- MetLife Mid Cap Stock Index Seeks to track the performance of the MetLife Advisers, LLC Portfolio--Class A Standard & Poor's MidCap 400(R) Subadviser: MetLife Composite Stock Price Index. Investment Management, LLC -----------------------------------------------------------------------------------------------------------
29
------------------------------------------------------------------------------------------------------- INVESTMENT ADVISER/ PORTFOLIO INVESTMENT OBJECTIVE SUBADVISER ------------------------------------------------------------------------------------------------------- MetLife Stock Index Portfolio--Class A Seeks to track the performance of the MetLife Advisers, LLC Standard & Poor's 500(R) Composite Subadviser: MetLife Stock Price Index. Investment Management, LLC ------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------- MFS(R) Total Return Portfolio--Class B Seeks a favorable total return MetLife Advisers, LLC through investment in a diversified Subadviser: Massachusetts portfolio. Financial Services Company ------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------- MFS(R) Value Portfolio--Class A Seeks capital appreciation. MetLife Advisers, LLC Subadviser: Massachusetts Financial Services Company ------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------- MSCI EAFE(R) Index Portfolio--Class A Seeks to track the performance of the MetLife Advisers, LLC MSCI EAFE(R) Index. Subadviser: MetLife Investment Management, LLC ------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------- Neuberger Berman Genesis Seeks high total return, consisting MetLife Advisers, LLC Portfolio--Class A principally of capital appreciation. Subadviser: Neuberger Berman Management LLC ------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------- Russell 2000(R) Index Seeks to track the performance of the MetLife Advisers, LLC Portfolio--Class A Russell 2000(R) Index. Subadviser: MetLife Investment Management, LLC ------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------- T. Rowe Price Large Cap Growth Seeks long-term growth of capital. MetLife Advisers, LLC Portfolio--Class A Subadviser: T. Rowe Price Associates, Inc. ------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------- T. Rowe Price Small Cap Growth Seeks long-term capital growth. MetLife Advisers, LLC Portfolio--Class A Subadviser: T. Rowe Price Associates, Inc. ------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------- WMC Balanced Portfolio--Class A Seeks long-term capital appreciation MetLife Advisers, LLC with some current income. Subadviser: Wellington Management Company, LLP ------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------- WMC Core Equity Opportunities Seeks to provide a growing stream of MetLife Advisers, LLC Portfolio--Class A income over time and, secondarily, Subadviser: Wellington long-term capital appreciation and Management Company, current income. LLP ------------------------------------------------------------------------------------------------------- MFS(R) VARIABLE INSURANCE TRUST--SERVICE CLASS ------------------------------------------------------------------------------------------------------- MFS(R) Global Equity Series Seeks capital appreciation. Massachusetts Financial Services Company ------------------------------------------------------------------------------------------------------- ------------------------------------------------------------------------------------------------------- MFS(R) New Discovery Series Seeks capital appreciation. Massachusetts Financial Services Company ------------------------------------------------------------------------------------------------------- MFS(R) VARIABLE INSURANCE TRUST II--SERVICE CLASS ------------------------------------------------------------------------------------------------------- MFS(R) High Yield Portfolio Seeks total return with an emphasis Massachusetts Financial on high current income, but also Services Company considering capital appreciation. ------------------------------------------------------------------------------------------------------- OPPENHEIMER VARIABLE ACCOUNT FUNDS--NON-SERVICE SHARES ------------------------------------------------------------------------------------------------------- Oppenheimer Main Street Small Cap Seeks capital appreciation. OFI Global Asset Fund(R)/VA Management, Inc. Subadviser: OppenheimerFunds, Inc. -------------------------------------------------------------------------------------------------------
30 PIMCO VARIABLE INSURANCE TRUST--ADMINISTRATIVE CLASS -------------------------------------------------------------------------------------------------------- PIMCO All Asset Portfolio Seeks maximum real return consistent Pacific Investment with preservation of real capital and Management Company prudent investment management. LLC Subadviser: Research Affiliates, LLC -------------------------------------------------------------------------------------------------------- -------------------------------------------------------------------------------------------------------- PIMCO CommodityRealReturn(R) Strategy Seeks maximum real return consistent Pacific Investment Portfolio with prudent investment management. Management Company LLC -------------------------------------------------------------------------------------------------------- -------------------------------------------------------------------------------------------------------- PIMCO Long-Term U.S. Government Seeks maximum total return, Pacific Investment Portfolio consistent with preservation of Management Company capital and prudent investment LLC management. -------------------------------------------------------------------------------------------------------- -------------------------------------------------------------------------------------------------------- PIMCO Low Duration Portfolio Seeks maximum total return, Pacific Investment consistent with preservation of Management Company capital and prudent investment LLC management. -------------------------------------------------------------------------------------------------------- PIONEER VARIABLE CONTRACTS TRUST -------------------------------------------------------------------------------------------------------- Pioneer Mid Cap Value VCT Seeks capital appreciation Pioneer Investment Portfolio--Class I by investing in a diversified Management, Inc. portfolio of securities consisting primarily of common stocks. -------------------------------------------------------------------------------------------------------- PUTNAM VARIABLE TRUST--CLASS IB -------------------------------------------------------------------------------------------------------- Putnam VT International Value Fund Seeks capital growth. Current income Putnam Investment is a secondary objective. Management, LLC Subadviser: The Putnam Advisory Company, LLC -------------------------------------------------------------------------------------------------------- ROYCE CAPITAL FUND--INVESTMENT CLASS -------------------------------------------------------------------------------------------------------- Royce Micro-Cap Portfolio Seeks long-term growth of capital. Royce & Associates, LLC -------------------------------------------------------------------------------------------------------- -------------------------------------------------------------------------------------------------------- Royce Small-Cap Portfolio Seeks long-term growth of capital. Royce & Associates, LLC -------------------------------------------------------------------------------------------------------- THE UNIVERSAL INSTITUTIONAL FUNDS, INC.--CLASS I -------------------------------------------------------------------------------------------------------- Emerging Markets Debt Portfolio Seeks high total return by investing Morgan Stanley primarily in fixed income securities Investment Management of government and government-related Inc. issuers and, to a lesser extent, of corporate issuers in emerging market countries. -------------------------------------------------------------------------------------------------------- -------------------------------------------------------------------------------------------------------- Emerging Markets Equity Portfolio Seeks long-term capital appreciation Morgan Stanley by investing primarily in Investment Management growth-oriented equity securities of Inc. issuers in emerging market countries. Subadvisers: Morgan Stanley Investment Management Company and Morgan Stanley Investment Management Limited --------------------------------------------------------------------------------------------------------
31 WELLS FARGO VARIABLE TRUST--CLASS 2 --------------------------------------------------------------------------------------------------------- VT Total Return Bond Fund Seeks total return, consisting of Wells Fargo Funds income and capital appreciation. Management, LLC Subadviser: Wells Capital Management Incorporated ---------------------------------------------------------------------------------------------------------
THE PORTFOLIO SHARE CLASSES THAT WE OFFER The Funds offer various classes of shares, each of which has a different level of expenses. The Fund prospectuses may provide information for share classes or Portfolios that are not available through the Policy. When you consult the Fund prospectus for a Portfolio, you should be careful to refer only to the information regarding the Portfolio and class of shares that is available through the Policy. SUBSTITUTION OF PORTFOLIOS If investment in the Portfolios or a particular Portfolio is no longer possible, in our judgment becomes inappropriate for the purposes of the Policies, or for any other reason in our sole discretion, we may substitute another portfolio without your consent. The substituted Portfolio may have different fees and expenses. Substitution may be made with respect to existing investments or the investment of future premium payments, or both. However, we will not make such substitution without any necessary approval of the Securities and Exchange Commission. Furthermore, we may make available or close investment divisions to allocation of premium payments or cash value, or both, for some or all classes of Policies, at any time in our sole discretion. VOTING RIGHTS [SIDEBAR: YOU CAN GIVE US VOTING INSTRUCTIONS ON SHARES OF EACH PORTFOLIO OF A FUND THAT ARE ATTRIBUTED TO YOUR POLICY.] The Funds have shareholder meetings from time to time to, for example, elect directors and approve some changes in investment management arrangements. We will vote the shares of each Portfolio that are attributed to your Policy based on your instructions. We will vote all shares in proportion to the instructions received. If we do not receive your instructions we will vote your shares in the same proportion as represented by the votes received from other owners. The effect of this proportional voting is that a small number of owners may control the outcome of a vote. Should we determine that the 1940 Act no longer requires us to do this, we may decide to vote Fund shares in our own right, without input from you or any other owners of variable life insurance policies or variable annuity contracts that participate in a Fund. ISSUING A POLICY If you want to own a Policy, then you must complete an application, which must be received by the Designated Office. We reserve the right to reject an application for any reason permitted by law, and our acceptance of an application is subject to our insurance underwriting rules. We offer other variable life insurance policies that have different death benefits, policy features, Portfolio selections, and optional programs. However, these other policies also have different charges that would affect 32 your performance and cash values. To obtain more information about these other policies, contact our Designated Office or your sales representative. There are three types of underwriting available under the Policy. We decide which type to use based on the total number of eligible possible insureds within the eligible group for whom a Policy could be purchased and the percentage of those insureds for whom a Policy is actually purchased. The three types of underwriting are: GUARANTEED ISSUE--requires the least evidence of insurability and rating classification SIMPLIFIED UNDERWRITING--requires more evidence of insurability and rating classification FULL UNDERWRITING--requires the most evidence of insurability and rating classification An insured who is a standard risk under Simplified Underwriting or Guaranteed Issue may have a higher cost of term insurance rate than would apply to the same insured under Full Underwriting. Generally, we will issue a Policy only for insureds that are age 70 or less (although we may decide to permit an insured that is older) that have provided evidence of insurability that we find acceptable. An "insured" is the person upon whose life we issue the Policy. For the purpose of computing the insured's age under the Policy, we start with the insured's age on the Date of Policy which is set forth in the Policy. Age under the Policy at any other time is then computed using that issue age and adding the number of full Policy years completed. The Date of Policy is usually the date the Policy application is approved and premiums are accepted. We use the Date of Policy to calculate the Policy years (and Policy months and monthly anniversaries). To preserve a younger age for the insured, we may permit a Date of Policy that is earlier than the date the application is approved if there have been no material misrepresentations in the application. You may request that your Date of Policy be the same date the planned periodic premium is received. In these cases, you would incur a charge for insurance protection before insurance coverage starts. Insurance coverage under the Policy will generally begin at the time the application is approved. For coverage to be effective, the insured's health on the date of such approval must be the same as stated in the application and, in most states, we can require that the insured not have sought medical advice or treatment between the date of the application and the date of approval. PAYMENT AND ALLOCATION OF PREMIUMS [SIDEBAR: YOU CAN MAKE VOLUNTARY PLANNED PERIODIC PREMIUM PAYMENTS AND UNSCHEDULED PREMIUM PAYMENTS.] The payment of a given premium won't necessarily guarantee that your Policy will remain in force. Rather, this depends on your Policy's cash surrender value. 33 PAYING PREMIUMS We accept premium payments made by check or cashier's check. We do not accept cash, money orders or traveler's checks. You can make premium payments, subject to certain limitations discussed below, through the: VOLUNTARY PLANNED PERIODIC PREMIUM SCHEDULE: You choose the schedule on your application. The schedule sets forth the amount of premiums, fixed payment intervals and the period of time that you intend to pay premiums. The schedule can be: (a) annual; (b) semi-annual; or (c) through another method to which we agree. After payment of the first planned periodic premium, you do not have to pay premiums in accordance with your voluntary planned period premium schedule. UNSCHEDULED PREMIUM PAYMENT OPTION: You also can make other premium payments at any time. Premium payments sent by regular U.S. mail should be addressed to: MetLife LB 7369, P.O. Box 8500-7369, Philadelphia, PA 19101-7369. Premium payments sent by express mail or courier service should be addressed to: Wells Fargo Bank, 101 N. Independence Mall East, MetLife Lock Box# 7369, Philadelphia, PA 19106. If you send premium payments or transaction requests to an address other than the one we have designated for receipt of such payments or requests, we may return the premium payment to you, or there may be a delay in applying the payment or transaction to your Policy. MAXIMUM AND MINIMUM PREMIUM PAYMENTS .. The first premium may not be less than the planned premium unless agreed to by us. .. After the first Policy year, your voluntary planned periodic payments must be at least $100, whether on an annual or semi-annual basis. .. Unscheduled premium payments must be at least $100 each. We may change this minimum amount on 90 days notice to you. .. You may not pay premiums that exceed tax law premium limitations for life insurance policies. We will return any amounts that exceed these limits, except that we will keep any amounts that are required to keep the Policy from terminating. We will let you make premium payments that would turn your Policy into a modified endowment contract, but we will tell you of this status in your annual statement, and if possible, we will tell you how to reverse the status. ("See Tax Matters--Modified Endowment Contracts.") .. We reserve the right not to sell a Policy to any group or individual associated with such group if the total amount of annual premium that is expected to be paid in connection with all Policies sold to the group or individuals associated with such group is less than $250,000. .. We may require evidence of insurability for premium payments that cause the minimum death benefit to exceed the death benefit then in effect under the death benefit option chosen. 34 ALLOCATING NET PREMIUMS [SIDEBAR: NET PREMIUMS ARE YOUR PREMIUMS MINUS THE CHARGES DEDUCTED FROM YOUR PREMIUMS.] Your allocations of net premiums to the Fixed Account are effective as of the Investment Start Date. See "Investment Start Date" description below in "Other Policy Provisions--When Your Requests Become Effective." Your allocations of net premiums to the investment divisions of the Separate Account are effective as of the end of the free look period. See "Other Policy Provisions--Free Look Period." During the free look period, we allocate the net premium payments you allocated to the investment divisions to the BlackRock Money Market investment division. At the end of the free look period, we will allocate your cash value in that investment division among all the Separate Account investment divisions according to your net premium allocation instructions. For policies issued in California, we allocate net premiums to the investment divisions of the Separate Account as of the Investment Start Date. If you are age 60 or older, and you allocate 100% of your initial net premium to the BlackRock Money Market investment division in order to receive a refund of premiums should you cancel the Policy during the free look period, we will not automatically transfer your cash value or reallocate your future premiums once the free look period has ended. You must contact us to request a transfer or reallocation. You can instruct us to allocate your net premiums among the Fixed Account and the investment divisions. You can change your allocations (effective after the end of the free look period) at any time by giving us written notification at our Designated Office or in any other manner that we permit. If you have cash value of at least $60,000,000 in the Fixed Account for all Policies you own, we will have to give prior approval to any allocation of net premium or transfer of cash value to the Fixed Account. INSURANCE PROCEEDS If the Policy is in force, we will pay your beneficiary the insurance proceeds as of the end of the Valuation Period that includes the insured's date of death. We will pay this amount after we receive documents that we request as due proof of the insured's death. We will pay the proceeds in one sum, including either by check, by placing the amount in an account that earns interest, or by any other method of payment that provides the beneficiary with immediate and full access to the proceeds, or under other settlement options that we may make available. None of these options vary with the investment performance of the Separate Account. More detailed information concerning settlement options is provided under "Income Plans" and on request from our Designated Office. We will pay interest on the proceeds as required by applicable state law. Unless otherwise requested and subject to state law, the Policy's death proceeds will generally be paid to the beneficiary through a settlement option called the Total Control Account. The Total Control Account is an interest-bearing account through which the beneficiary has immediate and full access to the proceeds, with unlimited draft writing privileges. We credit interest to the account at a rate that will not be less than a guaranteed minimum annual effective rate. You may also elect to have any Policy surrender proceeds paid into a Total Control Account established for you. 35 The beneficiary has one year from the date the insurance proceeds are paid to change the selection from a single sum payment to an income plan, as long as we have made no payments from the interest-bearing account. If the terms of the income plan permit the beneficiary to withdraw the entire amount from the plan, the beneficiary can also name contingent beneficiaries. The insurance proceeds equal: .. The death benefit under the death benefit option or minimum death benefit that is in effect on the date of death; plus .. Any additional insurance proceeds provided by rider; minus .. Any unpaid Policy loans and accrued interest thereon, and any due and unpaid charges accruing during a grace period. Every state has unclaimed property laws which generally declare life insurance policies to be abandoned after a period of inactivity of three to five years from the date any death benefit is due and payable. For example, if the payment of a death benefit has been triggered, and after a thorough search, we are still unable to locate the beneficiary of the death benefit, the death benefit will be paid to the abandoned property division or unclaimed property office of the state in which the beneficiary or the policy owner last resided, as shown on our books and records. ("Escheatment" is the formal, legal name for this process.) However, the state is obligated to pay the death benefit (without interest) if your beneficiary steps forward to claim it with the proper documentation. To prevent your Policy's death benefit from being paid to the state's abandoned or unclaimed property office, it is important that you update your beneficiary designation--including complete names and complete address--if and as they change. You should contact our Designated Office in order to make a change to your beneficiary designation. (See "Contacting Us.") DEATH BENEFIT OPTIONS [SIDEBAR: THE POLICY GENERALLY OFFERS A CHOICE OF THREE DEATH BENEFIT OPTIONS.] You can choose among three options. You select which option you want in the Policy application. The three options are: .. Option A: The death benefit is a level amount and equals the specified face amount of the Policy. .. Option B: The death benefit varies and equals the specified face amount of the Policy plus the cash value on the date of death. .. Option C: The death benefit varies and equals the specified face amount of the Policy plus the amount by which the Policy premiums paid exceed withdrawals made. There are issues that you should consider in choosing your death benefit option. For example, under Options B and C, the cash value or other amounts are added to the specified face amount. Therefore, the death benefit will generally be greater under these options than under Option A, for Policies with the same specified face amount and premium payments. By the same token, the cost of insurance will generally be greater under Options B and C than under Option A. [SIDEBAR: YOU CAN GENERALLY CHANGE YOUR DEATH BENEFIT OPTION.] You can change your death benefit option after the first Policy year, provided that: .. Your cash surrender value after the change would be enough to pay at least two monthly deductions. .. The specified face amount continues to be no less than the minimum we allow after a decrease. 36 .. The total premiums you have paid do not exceed the then current maximum premium limitations permitted under Internal Revenue Service rules. .. You provide evidence satisfactory to us of the insured's insurability, as we may require. Any change will be effective on the monthly anniversary on or immediately following the Date of Receipt of the request (or following the date we approve it if we require evidence of insurability). A change in death benefit option will cause us to automatically increase or decrease your specified face amount so that the amount of the death benefit is not changed on the effective date of the new death benefit option. Before you change your death benefit option you should consider the following: .. If the term insurance portion of your death benefit changes, as it may with a change from Option A to B or C and vice versa, the term insurance charge will also change. This will affect your cash value and, in some cases, the death benefit levels. .. If your specified face amount changes because of the change in death benefit option, consider also the issues presented by changing your specified face amount that are described under "Specified Face Amount," below. These issues include the possibility that your Policy would become a modified endowment contract; that you would receive a taxable distribution; and that the maximum premium amounts that you can pay would change. MINIMUM DEATH BENEFIT In no event will the Policy death benefit (plus the proceeds under any term rider on the insured's life) be lower than the minimum amount required to maintain the Policy as life insurance under the federal income tax laws as in effect on the date your Policy is issued. We determine this minimum by applying either the: I. Cash Value Accumulation Test or II. Guideline Premium/Cash Value Corridor Test. You choose the Cash Value Accumulation Test or the Guideline Premium/Cash Value Corridor Test before we issue your Policy, and the election cannot later be changed. Under the Cash Value Accumulation Test, your death benefit is never less than the amount of your Policy's cash value at the insured's date of death, multiplied by a factor set forth in your Policy. This factor varies depending upon the insured's age at the date of death, and it declines as the insured grows older. Under the Guideline Premium/Cash Value Corridor Test, there is a very similar minimum death benefit based on your Policy's cash value at the date of death. However, the factors set forth in your Policy are higher for the Guideline Premium/Cash Value Corridor Test (which results in a higher minimum death benefit, assuming the same cash value). Also, there are firm limits on the amount of premiums you can pay for the amount of coverage you have in force under the Guideline Premium/Cash Value Corridor Test, while the tax law imposes no such firm limits under the Cash Value Accumulation Test. 37 Before choosing between these two Tests you should consider the following: .. The Cash Value Accumulation Test may allow you to pay a greater amount in premiums for the same amount of death benefit under federal income tax laws and still qualify as life insurance. This is the case because the Policy will qualify as life insurance even though the Policy owner is paying a higher level of premium than allowed under the Guideline Premium/Cash Value Accumulation Test. However, the death benefit under the Cash Value Accumulation Test (and thus the monthly cost of term insurance) could be higher. You should ask for an illustration comparing results under both tests. We reserve the right to return any premium to the extent it would cause the death benefit to increase above certain limits. .. Increases in death benefits by operation of the Cash Value Accumulation Test will result in a higher monthly cost of term insurance. Such increases can also occur under the Guideline Premium/Cash Value Corridor Test, although this is less likely. .. Any advantage of the Cash Value Accumulation Test may be eliminated if premium payments exceed the 7-pay test limit. The 7-pay test sets a limit on the amount of premiums which may be paid under a policy during the 7-pay testing period (usually the first 7 Policy years after issue or after a material modification of the Policy) without incurring possible adverse tax consequences. If premiums paid exceed such limit during any 7-pay testing period, any partial withdrawals, Policy loan and other distributions may be subject to adverse federal income tax consequences. (See "Federal Tax Matters--Modified Endowment Contracts" below.) SPECIFIED FACE AMOUNT CHOOSING YOUR INITIAL SPECIFIED FACE AMOUNT The specified face amount is the basic amount of insurance specified in your Policy. The Minimum Initial Specified Face amount is the smallest amount of specified face amount for which a Policy may be issued. Currently this amount is $100,000. If the term insurance rider is purchased, the specified face amount and term rider amount are combined to determine the Minimum Initial Specified Face Amount. You should consider whether to take all of your coverage as specified face amount or whether to take some coverage, if available, under our term insurance benefit. The term insurance benefit provides coverage on the insured to age 95. You may purchase this rider, if available, only at the time of Policy issue. By electing to take part of your coverage under the term insurance rider, you can reduce the amount of sales charges and current cost of insurance charges that you otherwise would pay. For details, see "Optional Rider Benefits--Term Benefit." [SIDEBAR: YOU CAN GENERALLY INCREASE OR DECREASE YOUR POLICY'S SPECIFIED FACE AMOUNT.] CHANGING YOUR SPECIFIED FACE AMOUNT Generally, you may change your specified face amount at any time after the first Policy year subject to certain criteria specified below. Any change will be effective on: the monthly anniversary on or next following the (a) Date of Receipt of your request; or (b) if we require evidence of insurability, the date we approve your request. The Specified Face Amount of insurance may not be reduced to less than $100,000 during the first five Policy years or to less than $50,000 after the fifth Policy year. These minimums also apply to decreases that result from partial withdrawals or changes in death benefit options. If there have been previous specified face amount increases, any decreases in specified face amount will be 38 made in the following order: (i) the specified face amount provided by the most recent increase; (ii) the next most recent increases successively; and (iii) the initial specified face amount. You may increase the specified face amount only if the cash surrender value after the change is large enough to cover at least two monthly deductions based on your most recent cost of term insurance charge. Any increase may require that we receive additional evidence of insurability that is satisfactory to us. We may also impose a one-time underwriting charge. Before you change your specified face amount you should consider the following: .. The term insurance portion of your death benefit will change and so will the term insurance charge. This will affect the insurance charges, cash value and, in some cases, death benefit levels. .. Reducing your specified face amount may result in our returning an amount to you which, if it occurs during the first 15 Policy years, could then be taxed on an income first basis. .. The amount of additional premiums that the tax laws permit you to pay into your Policy may increase or decrease. The additional amount you can pay without causing your Policy to be a modified endowment contract for tax purposes may also increase or decrease. (See "Tax Matters--Modified Endowment Contracts.") .. In some circumstances, the Policy could become a modified endowment contract. .. For Policies issued on or after May 1, 1996 in connection with other than certain employer sponsored plans that became effective prior to August 1, 2000, the sales charge and the administration charge may change. This is because an increase or decrease in the specified face amount will result in an increase or decrease in the annual target premium on which these charges are based. INCOME PLANS [SIDEBAR: GENERALLY YOU CAN RECEIVE THE POLICY'S INSURANCE PROCEEDS, AMOUNTS PAYABLE AT THE FINAL DATE OR AMOUNTS PAID UPON SURRENDER UNDER AN INCOME PLAN INSTEAD OF IN A LUMP SUM.] The insurance proceeds can be paid under a variety of income plans that are available under the Policy. Generally, we currently make the following income plans available: .. Interest income .. Installment Income for a Stated Period .. Installment Income of a Stated Amount .. Single Life Income--Guaranteed Payment Period .. Single Life Income--Guaranteed Return .. Joint and Survivor Life Income Before you choose an income plan you should consider: .. The tax consequences associated with the Policy proceeds, which can vary considerably, depending on whether a plan is chosen. You or your beneficiary should consult with a qualified tax adviser about tax consequences. .. That your Policy will terminate at the time you commence an income plan and you will receive a new contract, which describes the terms of the income plan. You should carefully review the terms of the new contract, because it contains important information about the terms and conditions of the income plan. .. That the rates of return we credit under these plans are not based on the investment performance of any of the Portfolios. 39 CASH VALUE, TRANSFERS AND WITHDRAWALS CASH VALUE [SIDEBAR: YOUR POLICY IS DESIGNED TO ALLOW YOU TO ACCUMULATE CASH VALUE.] Your Policy's cash value equals: .. The Fixed Account cash value, plus .. The Policy Loan Account cash value, plus .. The Separate Account cash value. Your Policy's cash surrender value equals your cash value minus any outstanding Policy loans (plus any accrued and unpaid loan interest). On your Investment Start Date, the Policy's cash value in an investment division will equal the portion of any net premium allocated to the investment division, reduced by the portion of any monthly deductions allocated to the Policy's cash value in that investment division. Thereafter, at the end of each Valuation Period the cash value in an investment division will equal: .. The cash value in the investment division at the beginning of the Valuation Period; plus .. All net premiums, loan repayments and cash value transfers into the investment division during the Valuation Period; minus .. All partial cash withdrawals, loans and cash value transfers out of the investment division during the Valuation Period; minus .. The portion of any charges and deductions allocated to the cash value in the investment division during the Valuation Period; plus .. The net investment return for the Valuation Period on the amount of cash value in the investment division at the beginning of the Valuation Period. The net investment return currently equals the rate of increase or decrease in the net asset value per share of the underlying Fund Portfolio over the Valuation Period, adjusted upward to take appropriate account of any dividends and other distributions paid by the Portfolio during the period. CASH VALUE TRANSFERS [SIDEBAR: YOU CAN TRANSFER YOUR CASH VALUE AMONG THE INVESTMENT DIVISIONS AND THE FIXED ACCOUNT AT ANY TIME BEGINNING AFTER THE END OF THE FREE LOOK PERIOD.] The minimum amount you may transfer is $50 or, if less, the total amount in an investment option. You may make transfers at any time. The maximum amount that you may transfer or withdraw from the Fixed Account in any Policy year is the greater of $50 and 25% of the largest amount in the Fixed Account over the last four Policy years. Due to this limit, it could take a number of years to fully transfer or withdraw a current balance from the Fixed Account. You should keep this in mind when considering whether an allocation of cash value to the Fixed Account is consistent with your risk tolerance and time horizon. This limit does not apply to a full surrender, any loans taken, or any transfers under a systematic investment strategy. We may also limit the number of investment options to which you may transfer cash value, and, under certain conditions, we may have to approve transfers to the Fixed Account. (See "Payment and Allocation of Premiums--Allocating Net Premiums.") RESTRICTIONS ON FREQUENT TRANSFERS: Frequent requests from Policy owners to transfer cash value may dilute the value of a Portfolio's shares if the frequent trading involves an attempt to take advantage of pricing inefficiencies created by a lag between a change in the value of the securities 40 held by the Portfolio and the reflection of that change in the Portfolio's share price ("arbitrage trading"). Frequent transfers involving arbitrage trading may adversely affect the long-term performance of the Portfolios, which may in turn adversely affect Policy owners and other persons who may have an interest in the Policies (E.G., beneficiaries). We have policies and procedures that attempt to detect and deter frequent transfers in situations where we determine there is a potential for arbitrage trading. Currently, we believe that such situations may be presented in the international, small-cap, and high-yield Portfolios (I.E., Baillie Gifford International Stock Portfolio, Loomis Sayles Small Cap Core Portfolio, MSCI EAFE(R) Index Portfolio, Neuberger Berman Genesis Portfolio, Oppenheimer Global Equity Portfolio, Russell 2000(R) Index Portfolio, T. Rowe Price Small Cap Growth Portfolio, Lord Abbett Bond Debenture Portfolio, Harris Oakmark International Portfolio, Invesco Small Cap Growth Portfolio, MFS(R) Emerging Markets Equity Portfolio, MFS(R) Research International Portfolio, Third Avenue Small Cap Value Portfolio, Invesco V.I. International Growth Fund, AllianceBernstein Global Thematic Growth Portfolio, AllianceBernstein International Value Portfolio, American Funds High-Income Bond Fund, American Funds International Fund, Dreyfus VIF International Value Portfolio, Fidelity(R) VIP High Income Portfolio, Franklin Mutual Global Discovery VIP Fund, Templeton Foreign VIP Fund, Templeton Global Bond VIP Fund, Janus Aspen Overseas Portfolio, MFS(R) Global Equity Series, MFS(R) High Yield Portfolio, MFS(R) New Discovery Series, Goldman Sachs Small Cap Equity Insights Fund, Clarion Global Real Estate Portfolio, JPMorgan Small Cap Value Portfolio, Oppenheimer Main Street Small Cap Fund(R)/VA, Putnam VT International Value Fund, Royce Micro-Cap Portfolio, Royce Small-Cap Portfolio, UIF Emerging Markets Debt Portfolio and UIF Emerging Markets Equity Portfolio) and we monitor transfer activity in those Funds (the "Monitored Portfolios"). In addition, as described below, we intend to treat all American Funds Insurance Series(R) portfolios ("American Funds portfolios") as Monitored Portfolios. We employ various means to monitor transfer activity, such as examining the frequency and size of transfers into and out of the Monitored Portfolios within given periods of time. For example, we currently monitor transfer activity to determine if, for each category of international, small-cap, and high-yield Portfolios, in a 12-month period there were, (1) six or more transfers involving the given category; (2) cumulative gross transfers involving the given category that exceed the current cash value; and (3) two or more "round-trips" involving any Monitored Portfolio in the given category. A round-trip generally is defined as a transfer in followed by a transfer out within the next seven calendar days or a transfer out followed by a transfer in within the next seven calendar days, in either case subject to certain other criteria. WE DO NOT BELIEVE THAT OTHER PORTFOLIOS PRESENT A SIGNIFICANT OPPORTUNITY TO ENGAGE IN ARBITRAGE TRADING AND THEREFORE DO NOT MONITOR TRANSFER ACTIVITY IN THOSE PORTFOLIOS. We may change the Monitored Portfolios at any time without notice in our sole discretion. As a condition to making their portfolios available in our products, American Funds requires us to treat all American Funds portfolios as Monitored Portfolios under our current frequent transfer policies and procedures. Further, American Funds requires us to impose additional specified monitoring criteria for all American Funds portfolios available under the Policy, regardless of the potential for arbitrage trading. We are required to monitor transfer activity in American Funds portfolios to determine if there 41 were two or more transfers in followed by transfers out, in each case of a certain dollar amount or greater, in any 30-day period. A first violation of the American Funds monitoring policy will result in a written notice of violation; each additional violation will result in the imposition of a six-month restriction, during which period we will require all transfer requests to or from an American Funds portfolio to be submitted with an original signature. Further, as Monitored Portfolios, all American Funds portfolios also will be subject to our current frequent transfer policies, procedures and restrictions (described below), and transfer restrictions may be imposed upon a violation of either monitoring policy. Our policies and procedures may result in transfer restrictions being applied to deter frequent transfers. Currently, when we detect transfer activity in the Monitored Portfolios that exceeds our current transfer limits, we require future transfer requests to or from any Monitored Portfolios under that Policy to be submitted with an original signature. A first occurrence will result in the imposition of this restriction for a six-month period; a second occurrence will result in the permanent imposition of the restriction. Transfers made under one of the systematic investment strategies described below are not treated as transfers when we monitor the frequency of transfers. The detection and deterrence of harmful transfer activity involves judgments that are inherently subjective, such as the decision to monitor only those Portfolios that we believe are susceptible to arbitrage trading, or the determination of the transfer limits. Our ability to detect and/or restrict such transfer activity may be limited by operational and technological systems, as well as our ability to predict strategies employed by Policy owners to avoid such detection. Our ability to restrict such transfer activity may also be limited by provisions of the Policy. Accordingly, there is no assurance that we will prevent all transfer activity that may adversely affect Policy owners and other persons with interests in the Policies. We do not accommodate frequent transfers in any Portfolios and there are no arrangements in place to permit any Policy owner to engage in frequent transfers; we apply our policies and procedures without exception, waiver, or special arrangement. The Portfolios may have adopted their own policies and procedures with respect to frequent transfers in their respective shares, and we reserve the right to enforce these policies and procedures. For example, Portfolios may assess a redemption fee (which we reserve the right to collect) on shares held for a relatively short period. The prospectuses for the Portfolios describe any such policies and procedures, which may be more or less restrictive than the policies and procedures we have adopted. Although we may not have the contractual authority or the operational capacity to apply the frequent transfer policies and procedures of the Portfolios, we have entered into a written agreement, as required by SEC regulation, with each Portfolio or its principal underwriter that obligates us to provide to the Portfolio promptly upon request certain information about the trading activity of individual Policy owners, and to execute instructions from the Portfolio to restrict or prohibit further purchases or transfers by specific Policy owners who violate the frequent transfer policies established by the Portfolio. In addition, Policy owners and other persons with interests in the Policies should be aware that the purchase and redemption orders received by the Portfolios generally are "omnibus" orders from intermediaries such as 42 retirement plans or separate accounts funding variable insurance contracts. The omnibus orders reflect the aggregation and netting of multiple orders from individual owners of variable insurance policies and/or individual retirement plan participants. The omnibus nature of these orders may limit the Portfolios in their ability to apply their frequent transfer policies and procedures. In addition, the other insurance companies and/or retirement plans may have different policies and procedures or may not have any such policies and procedures because of contractual limitations. For these reasons, we cannot guarantee that the Portfolios (and thus Policy owners) will not be harmed by transfer activity relating to the other insurance companies and/or retirement plans that may invest in the Portfolios. If a Portfolio believes that an omnibus order reflects one or more transfer requests from Policy owners engaged in frequent trading the Portfolio may reject the entire omnibus order. In accordance with applicable law, we reserve the right to modify or terminate the transfer privilege at any time. We also reserve the right to defer or restrict the transfer privilege at any time that we are unable to purchase or redeem shares of any of the Portfolios, including any refusal or restriction on purchases or redemptions of their shares as a result of their own policies and procedures on frequent transfers (even if an entire omnibus order is rejected due to the frequent transfers of a single Policy owner). You should read the Fund prospectuses for more details. RESTRICTIONS ON LARGE TRANSFERS. Large transfers may increase brokerage and administrative costs of the underlying Portfolios and may disrupt portfolio management strategy, requiring a Portfolio to maintain a high cash position and possibly resulting in lost investment opportunities and forced liquidations. We do not monitor for large transfers to or from Portfolios except where the manager of a particular underlying Portfolio has brought large transfer activity to our attention for investigation on a case-by-case basis. For example, some portfolio managers have asked us to monitor for "block transfers" where transfer requests have been submitted on behalf of multiple owners by a third party such as an investment adviser. When we detect such large trades, we may impose restrictions similar to those described above where future transfer requests from that third party must be submitted in writing with an original signature. A first occurrence will result in the imposition of this restriction for a six-month period; a second occurrence will result in the permanent imposition of the restriction. SYSTEMATIC INVESTMENT STRATEGIES: You can choose one of four currently available strategies described below. You can also change or cancel your choice at any time. .. EQUITY GENERATOR(R). Allows you to transfer the interest earned on amounts in the Fixed Account in any Policy month equal to at least $20 to the MetLife Stock Index investment division or the Frontier Mid Cap Growth investment division. The transfer will be made at the beginning of the Policy month following the Policy month in which the interest was earned. .. EQUALIZER/ SM/. Allows you to periodically equalize amounts in your Fixed Account and either the MetLife Stock Index investment division or the Frontier Mid Cap Growth investment division. We currently make equalization each quarter. We will terminate this strategy if you make a transfer out of either of the investment divisions or the Fixed Account. You may then reelect the Equalizer on your next Policy anniversary. .. REBALANCER(R). Allows you to periodically redistribute amounts in the Fixed Account and investment divisions in the same proportion that the net premiums are then being allocated. We currently make the redistribution at the beginning of each quarter. 43 .. ALLOCATOR/ SM/. Allows you to systematically transfer money from the BlackRock Money Market investment division to the Fixed Account and/or any investment division(s). When you elect the Allocator, you must have enough cash value in the BlackRock Money Market investment division to enable the election to be in effect for three months. The election can be to transfer each month: .. A specific amount, until the cash value in the BlackRock Money Market investment division is exhausted. .. A specific amount for a specific number of months. .. Amounts in equal installments until the total amount you have requested has been transferred. These transfer privileges allow you to take advantage of investment fluctuations, but none assures a profit nor protects against a loss in declining markets. Because the Allocator involves continuous investment in securities regardless of the price levels of such securities, you should consider your financial ability to continue purchases through periods of fluctuating price levels. TRANSFERS BY TELEPHONE: Subject to our frequent transfer procedures, we may, if permitted by state law, decide in the future to allow you to make transfer requests, changes to Systematic Investment Strategies and changes to allocations of future net premium by phone. We may also allow you to authorize your sales representative to make such requests. The following procedures would apply: .. We must have received your authorization in writing satisfactory to us, to act on instructions from any person that claims to be you or your sales representative, as applicable, as long as that person follows our procedures. .. We will institute reasonable procedures to confirm that instructions we receive are genuine. Our procedures will include receiving from the caller your personalized data. Any telephone instructions that we reasonably believe to be genuine are your responsibility, including losses arising from such instructions. Because telephone transactions may be available to anyone who provides certain information about you and your Policy, you should protect that information. We may not be able to verify that you are the person providing telephone instructions, or that you have authorized any such person to act for you. .. All telephone calls will be recorded. .. You will receive a written confirmation of any transaction. .. Neither the Separate Account nor we will be liable for any loss, expense or cost arising out of a telephone request if we reasonably believed the request to be genuine. Telephone, facsimile, and computer systems may not always be available. Any telephone, facsimile, or computer system, whether it is yours, your service provider's, your sales representative's, or ours, can experience outages or slowdowns for a variety of reasons. These outages or slowdowns may delay or prevent our processing of your request. Although we have taken precautions to help our systems handle heavy use, we cannot promise complete reliability under all circumstances. If you are experiencing problems, you should make your request by writing to our Designated Office. SURRENDER AND WITHDRAWAL PRIVILEGES [SIDEBAR: YOU CAN SURRENDER YOUR POLICY FOR ITS CASH SURRENDER VALUE.] We may ask you to return the Policy before we honor your request to surrender your Policy. You can choose to have the proceeds paid in a single sum, or under an income plan. If the insured dies after you surrender the Policy but before the end of the Policy month in which you surrendered the Policy, we will pay your beneficiary an amount equal to the difference between the Policy's death benefit and its cash value, computed as of the surrender date. 44 You can make partial withdrawals if: .. the withdrawal would not result in the cash surrender value being less than sufficient to pay 2 monthly deductions; .. the withdrawal is at least $250; .. the withdrawal would not result in total premiums paid exceeding any then current maximum premium limitation determined by Internal Revenue Code rules; and .. the withdrawal would not result in your specified face amount falling below the minimum allowable amount after a decrease, as described under "Insurance Proceeds--Specified Amount--Changing Your Specified Face Amount," above. If you make a request for a partial withdrawal that is not permitted, we will tell you and you may then ask for a smaller withdrawal or surrender the Policy. We will deduct your withdrawal from the Fixed Account and the investment divisions in the same proportion that the Policy's cash value in each such option bears to the total cash value of the Policy in the Fixed Account and the investment divisions. We may withhold payment of surrender, withdrawal or loan proceeds if any portion of those proceeds would be derived from a check that has not yet cleared (I.E., that could still be dishonored by your banking institution). We may use telephone, fax, Internet or other means of communications to verify that payment from the check has been or will be collected. We will not delay payment longer than necessary for us to verify that payment has been or will be collected. You may avoid the possibility of delay in the disbursement of proceeds coming from a check that has not yet cleared by providing us with a certified check. Before surrendering your Policy or requesting a partial withdrawal, you should consider the following: .. Amounts received may be taxable as income and, if your Policy is a modified endowment contract, subject to certain tax penalties. (See "Tax Matters--Modified Endowment Contracts.") .. Your Policy could become a modified endowment contract. .. For partial withdrawals, your death benefit will decrease, generally by the amount of the withdrawal. .. For partial withdrawals, your specified face amount may also decrease. For Option A Policies, your specified face amount will decrease by the amount of the withdrawal. For Option B Policies, a withdrawal will not decrease the specified face amount. For Option C Policies, your specified face amount will decrease by the amount, if any, by which cumulative withdrawals exceed cumulative premiums paid. In some cases you may be better off taking a Policy loan, rather than a partial withdrawal. BENEFIT AT FINAL DATE The Final Date is the Policy anniversary on which the insured is Age 95. Subject to certain conditions, we will allow you to extend that date where permitted by state law. If the insured is living on the Final Date, we will pay you the cash surrender value of the Policy. You can receive the cash surrender value in a single sum, in an account that earns interest, or under an available income plan. 45 LOAN PRIVILEGES [SIDEBAR: YOU CAN BORROW FROM US AND USE YOUR POLICY AS SECURITY FOR THE LOAN.] The amount of each loan must be: .. At least $250. .. No more than the greater of the cash surrender value less two monthly deductions and 75% of the cash surrender value (unless state law requires a different percentage to be applied, as set forth in your Policy) when added to all other outstanding Policy loans. As of your loan request's Date of Receipt, we will: .. Remove an amount equal to the loan from your cash value in the Fixed Account and each investment division of the Separate Account in the same proportion as the Policy's cash value in each such option bears to the total cash value of the Policy in the Fixed Account and the investment divisions. .. Transfer such cash value to the Policy loan account, where it will be credited with interest at a rate equal to the loan rate charged less a percentage charge, based on expenses associated with Policy loans, determined by us. This percentage charge will not exceed 2%, and the minimum rate we will credit to the Policy Loan Account will be 2.5% per year (4% for Policies issued prior to February 24, 2012). At least once a year, we will transfer any interest earned in your Policy loan account to the Fixed Account and the investment divisions, according to the way that we then allocate your net premiums. .. Charge you interest, which will accrue daily. We will tell you the initial interest rate that applies to your loan and mail you advance notices of any increases applicable to existing loans. The interest rate charged for a Policy year will never be more than the maximum allowed by law and will generally be the greater of: .. The published monthly average for the calendar month ending two months before the start of such year; and .. The guaranteed rate used to credit interest to the cash value allocated to the Fixed Account for the Policy, plus no more than 1%. The published monthly average means (a) Moody's Corporate Bond Yield Average Monthly Average Corporates, as published by Moody's Investors Service, Inc. or any successor service; or (b) If the Moody's average is not published, a substantially similar average established by regulation issued by the insurance supervisory official of the state in which your Policy is delivered. Your interest payments are due at the end of each Policy year and if you don't pay the amount within 31 days after it is due, we will treat it as a new Policy loan, which will be taken from the Fixed Account and the investment divisions by the same method as other loans. Repaying your loans (plus accrued interest) is done by sending in payments at least equal to $25. You should designate whether a payment is intended as a loan repayment or a premium payment, since we will treat any payment for which no designation is made as a premium payment. We will allocate your repayment to the Fixed Account and the investment divisions, in the same proportion that net premiums are then allocated, except that amounts borrowed from the Fixed Account will be repaid to the Fixed Account first. Before taking a Policy loan you should consider the following: .. Interest payments on loans are generally not deductible for tax purposes. .. Under certain situations, Policy loans could be considered taxable distributions. .. Amounts held in your Policy loan account do not participate in the investment experience of the investment divisions or receive the interest rate credited to the Fixed Account, either of which may be higher than the interest rate credited on the amount you borrow. 46 .. If you surrender your Policy or if we terminate your Policy, or at the Final Date, any outstanding loan amounts (plus accrued interest) will be taxed as a distribution. (See "Federal Tax Matters--Loans" below.) .. A Policy loan increases the chances of our terminating your Policy due to insufficient cash value. We will terminate your Policy with no value if: (a) on a monthly anniversary your loans (plus accrued interest) exceed your cash value minus the monthly deduction; and (b) we tell you of the insufficiency and you do not make a sufficient payment within 61 days of the monthly anniversary. .. Your Policy's death proceeds will be reduced by any unpaid loan (plus any accrued and unpaid loan interest). OPTIONAL RIDER BENEFITS You may be eligible for certain benefits provided by rider, subject to certain underwriting requirements and the payment of additional premiums. We will deduct any charges for the rider(s) (other than the charge for the interim term insurance rider) as part of the monthly deduction. Generally, we currently make the following benefits available by rider: . Accelerated Death . Term Insurance Benefit/1/ Benefit/2/ ----------------------------------------------------- . Interim Term Insurance . Enhanced Cash Benefit Surrender Value Rider/3/ ----------------------------------------------------- -------- /1/ Payment under this rider may affect eligibility for benefits under state or federal law. This rider is currently not available in New Jersey. /2/ This rider is discussed in more detail under "Term Benefit" below. /3/ This rider may be attached at issue if you request it, but not thereafter. Each rider contains important information, including limits and conditions that apply to the benefits. If you decide to purchase any of the riders, you should carefully review their provisions to be sure the benefit is something that you want. These riders may not be available in all states. You should also consider: .. That the addition of certain riders can restrict your ability to exercise certain rights under the Policy. .. That the amount of benefits provided under the rider is not based on investment performance of a separate account; but, if the Policy terminates because of poor investment performance or any other reason, the riders generally will also terminate. .. That there are tax consequences. You should also consult with your tax advisor before purchasing one of the riders. TERM BENEFIT You have the flexibility to include, at Policy issue, a rider that provides a term benefit ("Term Rider"). The availability of the Term Rider is also subject to governmental approval in your state. The Term Rider is a rider to the Policy that, like the base Policy, provides coverage on the insured to age 95. You may purchase this rider, if available, only at Policy issue. Nevertheless, if you purchase the Term Rider, the amount of coverage under the rider will automatically increase and decrease with any changes to your specified face amount under the Policy, so that the 47 ratio between the Policy's specified face amount and the amount of Term Rider coverage will always remain the same as you originally selected. In almost all respects, coverage taken under the Term Rider has exactly the same effect as coverage taken as specified face amount under the Policy. An important difference, however, is that the sales charge depends on the amount of the coverage provided under the base policy. The amount of Term Rider will impact the sales charge. Thus, in comparing two Policies with identical total insurance amounts, the one with the greater portion provided by the Term Rider will have a lower sales charge. Conversely, the Policy with the higher amount provided under the base policy will have a higher sales charge. Additionally, the cost of term insurance rates currently applicable to coverage provided under the Term Rider are lower than those currently charged for coverage under the base policy. Therefore, the larger the portion of coverage provided under the Term Rider, the lower the overall cost of insurance. Again comparing two Policies with identical total insurance amounts, the cost of insurance will be lower under the Policy with the higher portion of coverage provided under the Term Rider. To summarize, the lower sales charge and lower anticipated current cost of term insurance rates resulting from a greater portion of total coverage provided by the Term Rider will result in better overall performance under the Policy. You may elect to have up to 95% of your total coverage provided by the Term Rider. We are able to make these favorable terms available under the Term Rider largely because our costs of selling it (principally the commissions we pay) are lower than under the base policy. See "Sales of Policies". CHARGES AND DEDUCTIONS IMPORTANT INFORMATION APPLICABLE TO ALL POLICY CHARGES AND DEDUCTIONS [SIDEBAR: CAREFULLY REVIEW THE FEE TABLES IN THIS PROSPECTUS WHICH SET FORTH THE CHARGES THAT YOU PAY UNDER YOUR POLICY.] The charges discussed in the paragraphs that follow are all included in the Fee Tables on pages 9 to 21 of this Prospectus. You should refer to these Fee Tables for information about the rates and amounts of such charges, as well as other information that is not covered below. The Policy charges compensate us for the services and benefits we provide, the costs and expenses we incur, and the risks we assume. Services and benefits we . the death benefit, cash, and loan benefits under provide: the Policy . investment options, including premium allocations . administration of elective options . the distribution of reports to Policy owners Costs and expenses we incur:. costs associated with processing and underwriting applications, and with issuing and administering the Policy (including any riders) 48 . overhead and other expenses for providing services and benefits . sales and marketing expenses . other costs of doing business, such as collecting premiums, maintaining records, processing claims, effecting transactions, and paying federal, state, and local premium and other taxes and fees Risks we assume: . that the cost of term insurance charges we may deduct are insufficient to meet our actual claims because the insureds die sooner than we estimate . that the charges of providing the services and benefits under the Policies exceed the charges we deduct We may profit from the charges, including the cost of term insurance charge and the mortality and expense risk charge. Any distinctions we make about the specific purposes of the different charges are imprecise, and we are free to keep and use our revenues or profits for any other purpose, including paying any of our costs and expenses in connection with the Policies. Our revenues from any particular charge may be more or less than any costs or expenses that charge may be intended primarily to cover. The following sets forth additional information about Policy charges. CHARGES DEDUCTED FROM PREMIUMS ANNUAL TARGET PREMIUM: We use the concept of annual target premium to determine certain limits on sales and administrative charges (discussed immediately below). We define the annual target premium to be: For Policies issued prior to May 1, 1996 or issued in connection with certain employer sponsored plans that became effective prior to August 1, 2000, 50% of the estimated annual amount which satisfied the 7-Pay test under federal tax law based on the issue age of the insured and the initial specified face amount. (See "Federal Tax Matters--Modified Endowment Contracts".) For all other Policies, 100% of the estimated annual amount that satisfied the 7-Pay test based on the issue age of the insured, the specified face amount of insurance of the base Policy only (excluding the Term Rider) and standard underwriting class. For such Policies, the annual target premium amount is increased and decreased proportionately for increases and decreases in the specified face amount of the Policy. This could, in turn, increase or decrease sales and administrative charges. SALES CHARGE: We deduct this charge primarily to help pay the cost of compensating sales representatives and other direct and indirect expenses of distributing the Policies. The charge is assessed directly against each premium. For premiums received in Policy years 1 through 10, the current rate is up to 6.5% of the premium paid until the total payments in each such year equal the annual target premium, and for Policy years 11 and later the rate we charge is up to 3% of each premium until the total payments in the year equal the annual target premium. No sales charge is or will be assessed 49 against any premiums paid in any Policy year in excess of a total equal to the annual target premium. The maximum rate we can charge for premiums received up to a total equal to the annual target premium during Policy years 1 through 10 is 9%, and the maximum for Policy years 11 and later is the same as currently charged in those years. ADMINISTRATIVE CHARGE: We incur expenses in the administration of the Policy, including our underwriting and start-up expenses. We deduct up to 1.05% (currently, this deduction is .55% in Policy years 1-10) of each premium payment primarily to cover this expense up to a total of payments in any Policy year equal to the annual target premium, and .05% on any excess payments in any Policy year exceeding that total amount. Our charge will never exceed this rate. CHARGE FOR AVERAGE EXPECTED STATE AND LOCAL TAXES ATTRIBUTABLE TO PREMIUMS: We make this charge to reimburse us for the state premium taxes that we must pay on premiums we receive. Premium taxes vary from state to state and currently range from 0 to 3.5%. Our charge of 2.25% approximates the average tax rate we expect to pay on premiums we receive from all states. CHARGE FOR EXPECTED FEDERAL TAXES ATTRIBUTABLE TO PREMIUMS: Federal income tax law requires us to pay certain amounts of taxes that are related to the amount of premiums we receive. We deduct 1.2% of each premium payment to offset the cost to us of those additional taxes, which may be more or less than the amount we pay in respect of your premiums. CHARGE FOR INTERIM TERM INSURANCE BENEFIT: This charge is deducted only from your initial premium payment, and only if you elect the interim term insurance benefit. The interim term insurance benefit provides temporary initial life insurance coverage on the insured prior to the time that coverage under the Policy takes effect. This coverage is provided by adding a "rider" and is subject to several conditions and limitations. The charge for this benefit is described in the rider form. This charge is primarily to compensate us for the risk that the insured will die while coverage under this rider is in force. LOAN INTEREST SPREAD: We charge interest on Policy loans but credit you with interest on the amount of the cash value we hold as collateral for the loan. The loan interest spread is the excess of the interest rate we charge over the interest rate we credit. This charge is primarily to cover our expense in providing the loan. The charge is guaranteed to never exceed 2%. CHARGES INCLUDED IN THE MONTHLY DEDUCTION We allocate the monthly deduction (except for the monthly mortality and expense risk charge) among the Fixed Account and each investment division of the Separate Account in the same proportion as the Policy's cash value in each such option bears to the total cash value of the Policy in the Fixed Account and the investment divisions. We deduct the monthly deductions as of each monthly anniversary, commencing with the Date of Policy. .. COST OF TERM INSURANCE. This charge varies monthly based on many factors. Each month, we determine the charge by multiplying your cost of insurance rates by the term insurance amount. This is the amount that we are at risk if the insured dies. The term insurance amount is the death benefit at the beginning of the Policy month divided by a discount factor to account for an assumed return 50 during the month; minus the cash value at the beginning of the Policy month after deduction of all other applicable charges. Factors that affect the term insurance amount include the specified face amount, the cash value and the death benefit option you choose (generally, the term insurance amount will be higher for Options B and C). The term insurance rate is based on our expectations as to future experience, taking into account the insured's sex (if permitted by law and applicable under your Policy), age, underwriting class and rate class. The rates will never exceed the guaranteed rates. The guaranteed rates are based on certain 2001 Commissioners Standard Ordinary Mortality Tables. For Policies issued prior to January 1, 2009, the guaranteed rates are based on the corresponding 1980 Commissioners Standard Ordinary Mortality Tables. Our current rates are lower than the maximums in most cases. We review our rates periodically and may adjust them, but we will apply the same rates to everyone who has had their Policy for the same amount of time and who is the same age, sex and rate class. As a general rule, the cost of insurance rate increases each year you own your Policy, as the insured's age increases. Rate class relates to the level of mortality risk we assume with respect to an insured. It can be the standard rate class, or one that is higher (and may be divided by smoking status). The insured's rate class will affect your cost of term insurance. You can also have more than one rate class in effect, if the insured's rate class has changed and you change your specified face amount. A better rate class will lower the cost of term insurance on your entire Policy and a worse rate class will affect the portion of your cost of term insurance charge attributable to the specified face amount increase. .. MORTALITY AND EXPENSE RISK CHARGE. We make this monthly charge primarily to compensate us for mortality risks that insureds may live for a shorter period than we expect; and expense risks that our issuing and administrative expenses may be higher than we expect. This monthly charge is allocated proportionately to the cash value in each investment division of the Separate Account. The maximum rate we may charge is equivalent to an effective annual rate of .90% of the cash value in the Separate Account. CHARGES FOR CERTAIN OPTIONAL RIDER BENEFITS The charge for an optional benefit that you add by rider to your Policy will generally be deducted as part of the monthly deduction. This includes the charge for the following rider: .. Term Benefit The purpose of the charge for each rider is primarily to compensate us for our direct and indirect costs and risks in providing that rider. The charge we deduct for any such additional benefits you can add by rider is described in the rider form. VARIATIONS IN CHARGES We may vary a charge by group, based on anticipated variations in our costs or risks associated with the group or individuals in the group that the charge was intended to cover. Our variations in the charges will be made in 51 accordance with our established and uniformly applied administrative procedures. We consider a variety of factors in determining charges, including but not limited to: .. The nature of the group and its organizational framework .. The method by which sales will be made to the individuals associated with the group .. The facility by which premiums will be paid .. The group's capabilities with respect to administrative tasks .. Our anticipated persistency of the Policies .. The size of the group and the number or years it has been in existence .. The aggregate amount of premiums we expect to be paid on the Policies owned by the group or by individuals associated with the group Any variations in charges will be reasonable and will not be unfairly discriminatory to the interests of any Policy owner. PORTFOLIO COMPANY CHARGES Each of the Portfolios pays an investment management fee to its investment manager. Each Portfolio also incurs other direct expenses. See the fuller description contained in the Fee Table section of this Prospectus (also see the Fund Prospectus and Statement of Additional Information referred to therein for each Fund). You bear indirectly your proportionate share of the fees and expenses of the Portfolios of each Fund that correspond to the Separate Account investment divisions you are using. OTHER CHARGES ADDITIONAL TAXES. In general, we don't expect to incur federal, state or local taxes upon the earnings or realized capital gains attributable to the assets in the Separate Account relating to the cash surrender value of the Policies. If we do incur such taxes, we reserve the right to charge cash value allocated to the Separate Account for these taxes. CASH VALUE TRANSFERS. We do not currently charge for any transfer amounts. Except for transfers under Systematic Investment Strategies, we reserve the right to assess up to a $25 charge in the future against all transfers. Currently, transfers are not taxable transactions. POLICY TERMINATION AND REINSTATEMENT TERMINATION: We will terminate your Policy without any cash surrender value if: .. The cash surrender value is less than the monthly deduction; and .. We do not receive a sufficient premium payment within the 61-day grace period to cover the monthly deduction. We will mail you notice if any grace period starts. REINSTATEMENT: Upon your request, we will reinstate your Policy (without reinstating any amounts in a Policy loan account), subject to certain terms and conditions that the Policy provides. We must receive your request within 3 years (or any longer period required by state law) after the end of the grace period and before the Final Date. You also must provide us: .. A written application for reinstatement (the date we approve the application will be the effective date of the reinstatement). 52 .. Evidence of insurability that we find satisfactory. .. An additional premium amount that the Policy prescribes for this purpose. FEDERAL TAX MATTERS [SIDEBAR: YOU SHOULD CONSULT WITH YOUR OWN TAX ADVISOR TO FIND OUT HOW TAXES CAN AFFECT YOUR BENEFITS AND RIGHTS UNDER YOUR POLICY.] The following is a brief summary of some tax rules that may apply to your Policy. Such discussion does not purport to be complete or to cover every situation. You must consult with and rely on the advice of your own tax or ERISA counsel, especially where the Policy is being purchased in connection with an employee benefit plan, such as a death benefit or deferred compensation plan, or is being purchased for estate, tax planning or similar purposes. You should also consult with your own tax advisor to find out how taxes can affect your benefits and rights under your Policy. Such consultation is especially important before you make unscheduled premium payments, change your specified face amount, change your death benefit option, change coverage provided by riders, take a loan or withdrawal, or assign or surrender the Policy. Under current federal income tax law, the taxable portion of distributions from variable life policies is taxed at ordinary income tax rates and does not qualify for the reduced tax rate applicable to long-term capital gains and dividends. IRS CIRCULAR 230 NOTICE: The information contained herein is not intended to (and cannot) be used by anyone to avoid IRS penalties. It is intended to support the sale of the Policy. The Policy owner should seek tax advice based on the Policy owner's particular circumstances from an independent tax adviser since this discussion of taxes is for general informational purposes and does not purport to be complete or to cover every situation. INSURANCE PROCEEDS .. Insurance proceeds are generally excludable from your beneficiary's gross income to the extent provided in Section 101 of the Internal Revenue Code. .. In the case of employer-owned life insurance as defined in Section 101(j), the amount of the death benefit excludable from gross income is limited to premiums paid unless the Policy falls within certain specified exceptions and a notice and consent requirement is satisfied before the Policy is issued. Certain specified exceptions are based on the status of an employee as highly compensated, a director, or recently employed. There are also exceptions for Policy proceeds paid to an employee's heirs. These exceptions only apply if proper notice is given to the insured employee and consent is received from the insured employee before the issuance of the Policy. These rules apply to Policies issued August 18, 2006 and later and also apply to policies issued before August 18, 2006 after a material increase in the death benefit or other material change. An IRS reporting requirement applies to employer-owned life insurance subject to these rules. Because these rules are complex and will affect the tax treatment of death benefits, it is advisable to consult tax counsel. The death benefit will also be taxable in the case of a transfer-for-value unless certain exceptions apply. .. The death proceeds may be subject to federal estate tax: (i) if paid to the insured's estate or (ii) if paid to a different beneficiary if the insured possessed incidents of ownership at or within three years before death. .. If you die before the insured, the value of your Policy (determined under IRS rules) is included in your estate and may be subject to federal estate tax. .. Whether or not any federal estate tax is due is based on a number of factors including the estate size. Please consult your tax adviser for the applicable estate tax rates. .. The insurance proceeds payable upon death of the insured will never be less than the minimum amount required for the Policy issued on a standard risk basis to be 53 treated as life insurance under Section 7702 of the Internal Revenue Code, as in effect on the date the Policy was issued. The rules with respect to Policies issued on a substandard risk basis are not entirely clear. CASH VALUE (IF YOUR POLICY IS NOT A MODIFIED ENDOWMENT CONTRACT) .. You are generally not taxed on your cash value until you withdraw it or surrender your Policy or receive a distribution (such as on the Final Date). In these cases, you are generally permitted to take withdrawals and receive other distributions up to the amount of premiums paid without any tax consequences. However, withdrawals and other distributions will be subject to income tax after you have received amounts equal to the total premiums you paid. Somewhat different rules may apply if there is a death benefit reduction in the first 15 Policy years, when a distribution may be subject to tax on an income-out-first basis if there is a gain in your Policy (which is generally when your cash value exceeds the cumulative premiums you paid). Finally, if your Policy is part of an equity split dollar arrangement taxed under the economic benefit regime, you should consult a tax adviser to see whether any portion of the cash value will be taxed prior to any Policy distribution. LOANS .. Loan amounts you receive will generally not be subject to income tax, unless your Policy is or becomes a modified endowment contract, is exchanged or terminates. .. Interest on loans is generally not deductible. For businesses that own a Policy, at least part of the interest deduction unrelated to the Policy may be disallowed unless the insured is a 20% owner, officer, director or employee of the business. .. If your Policy terminates (upon surrender, cancellation, lapse, the Final Date or, in most cases, exchanges) while any Policy loan is outstanding, the amount of the loan plus accrued interest thereon will be deemed to be a "distribution" to you. Any such distribution will have the same tax consequences as any other Policy distribution. Thus, there will generally be federal income tax payable on the amount by which withdrawals and loans exceed your remaining basis in the Policy. In the case of an exchange, any outstanding Policy loan will generally be taxed to the extent of any Policy gain. Please be advised that amounts borrowed and withdrawn reduce the Policy's cash value and any remaining Policy cash value may be insufficient to pay the income tax on your gains. MODIFIED ENDOWMENT CONTRACTS These contracts are life insurance contracts where the premiums paid during the first 7 years after the Policy is issued, or after a material change in the Policy, exceed tax law limits referred to as the "7-pay test." Material changes in the Policy include changes in the level of benefits and certain other changes to your Policy after the issue date. Reductions in benefits during a 7-pay period also may cause your Policy to become a modified endowment contract. Generally, a life insurance policy that is received in exchange for a modified endowment contract will also be considered a modified endowment contract. The IRS has promulgated a procedure for the correction of inadvertent modified endowment contracts. Due to the flexibility of the Policies as to premiums and benefits, the individual circumstances of each Policy will determine whether it is classified as a MEC. If your Policy is considered a modified endowment contract the following applies: .. The death benefit will still generally be income tax free to your beneficiary, to the extent discussed above. 54 .. Amounts withdrawn or distributed before the insured's death, including (without limitation) loans, assignments and pledges, are treated as income first and subject to income tax (to the extent of any gain in your Policy). All modified endowment contracts you purchase from us and our affiliates during the same calendar year are treated as a single contract for purposes of determining the amount of any such income. .. An additional 10% income tax generally applies to the taxable portion of the amounts received before age 591/2 except generally if you are disabled or if the distribution is part of a series of substantially equal periodic payments made over life expectancy. The foregoing exceptions to the 10% MEC additional tax generally does not apply to a corporate owned Policy. .. If a Policy becomes a modified endowment contract, distributions that occur during the Policy year will be taxed as distributions from a modified endowment contract. In addition, distributions from a Policy within two years before it becomes a modified endowment contract will be taxed in this manner. This means that a distribution made from a Policy that is not a modified endowment contract could later become taxable as a distribution from a modified endowment contract. DIVERSIFICATION In order for your Policy to qualify as life insurance, we must comply with certain diversification standards with respect to the investments underlying the Policy. We believe that we satisfy and will continue to satisfy these diversification standards. Inadvertent failure to meet these standards may be able to be corrected. Failure to meet these standards would result in immediate taxation to Policy owners of gains under their Policies. If Portfolio shares are sold directly to tax-qualified retirement plans that later lose their tax-qualified status, or to non-qualified plans, there could be adverse consequences under the diversification rules. INVESTOR CONTROL In some circumstances, owners of variable policies who retain excessive control over the investment of the underlying Separate Account assets may be treated as the owners of those assets and may be subject to tax on income produced by those assets. Although published guidance in this area does not address certain aspects of the Policies, we believe that the Owner of a Policy should not be treated as an owner of the assets in our Separate Account. We reserve the right to modify the Policies to bring them into conformity with applicable standards should such modification be necessary to prevent Owners of the Policies from being treated as the owners of the underlying Separate Account assets. ESTATE, GIFT AND GENERATION-SKIPPING TRANSFER TAXES The transfer of the Policy or the designation of a beneficiary may have Federal, state, and/or local transfer and inheritance tax consequences, including the imposition of gift, estate, and generation-skipping transfer taxes. When the insured dies, the death proceeds will generally be includable in the Policy owner's estate for purposes of the Federal estate tax if the Policy owner was the insured. If the Policy owner was not the insured, the fair market value of the Policy would be included in the Policy owner's estate upon the Policy owner's death. The Policy would not be includable in the insured's estate if the insured neither retained incidents of ownership at death nor had given up ownership within three years before death. Moreover, under certain circumstances, the Internal Revenue Code may impose a "generation-skipping transfer tax" when all or part of a life insurance policy is transferred to, or a death benefit is paid to, an individual two or more generations younger than the Policy owner. Regulations issued under the Internal Revenue Code may require us to deduct the tax from your Policy, or from any applicable payment, and pay it directly to the IRS. 55 Qualified tax advisers should be consulted concerning the estate and gift tax consequences of Policy ownership and distributions under Federal, state and local law. The individual situation of each Policy owner or beneficiary will determine the extent, if any, to which Federal, state, and local transfer and inheritance taxes may be imposed and how ownership or receipt of Policy proceeds will be treated for purposes of Federal, state and local estate, inheritance, generation-skipping and other taxes. In general, current rules provide for a $5 million estate, gift and generation-skipping transfer tax exemption (as indexed for inflation) and a top tax rate of 40 percent. The complexity of the tax law, along with uncertainty as to how it might be modified in coming years, underscores the importance of seeking guidance from a qualified adviser to help ensure that your estate plan adequately addresses your needs and those of your beneficiaries under all possible scenarios. WITHHOLDING To the extent that Policy distributions are taxable, they are generally subject to withholding for the recipient's Federal income tax liability. Recipients can generally elect however, not to have tax withheld from distributions. LIFE INSURANCE PURCHASES BY NONRESIDENT ALIENS AND FOREIGN CORPORATIONS Policy Owners that are not U.S. citizens or residents will generally be subject to U.S. federal withholding tax on taxable distributions from life insurance policies at a 30% rate, unless a lower treaty rate applies. In addition, Policy Owners may be subject to state and/or municipal taxes and taxes that may be imposed by the Policy Owner's country of citizenship or residence. Prospective purchasers are advised to consult with a qualified tax adviser regarding taxation with respect to a Policy purchase. BUSINESS USES OF POLICY Businesses can use the Policies in various arrangements, including nonqualified deferred compensation or salary continuation plans, split dollar insurance plans, executive bonus plans, tax exempt and nonexempt welfare benefit plans, retiree medical benefit plans and others. The tax consequences of such plans may vary depending on the particular facts and circumstances. If you are purchasing the Policy for any arrangement the value of which depends in part on its tax consequences, you should consult a qualified tax adviser. There may be an indirect tax upon the income in the Policy or the proceeds of a Policy under the Federal corporate alternative minimum tax, if you are subject to that tax. The IRS has issued guidance on split dollar insurance plans. A tax adviser should be consulted with respect to this guidance if you have purchased or are considering the purchase of a Policy for a split dollar insurance plan. The Sarbanes-Oxley Act of 2002 (the "Act"), which was signed into law on July 30, 2002, prohibits, with limited exceptions, publicly-traded companies, including non-U.S. companies that have securities listed on exchanges in the United States, from extending, directly or indirectly or through a subsidiary, many types of personal loans to their directors or executive officers. It is possible that this prohibition may be interpreted as applying to split-dollar life insurance policies for directors and executive officers of such companies, since 56 at least some such arrangements can arguably be viewed as involving a loan from the employer for at least some purposes. Any affected business contemplating the payment of a premium on an existing policy, or the purchase of a new policy in connection with a split dollar life insurance arrangement should consult legal counsel. Split dollar insurance plans that provide deferred compensation may be subject to rules governing deferred compensation arrangements. Failure to adhere to these rules will result in adverse tax consequences. A tax adviser should be consulted with respect to such plans. In the case of a business-owned Policy, the provisions of Section 101(j) of the Code may limit the amount of the death benefit excludable from gross income unless a specified exception applies and a notice and consent requirement is satisfied, as discussed above. CHANGES TO TAX RULES AND INTERPRETATIONS Changes in applicable tax rules and interpretations can adversely affect the tax treatment of your Policy. These changes may take effect retroactively. We reserve the right to amend the Policy in any way necessary to avoid any adverse tax treatment. Examples of changes that could create adverse tax consequences include: .. Possible taxation of cash value transfers between investment funds. .. Possible taxation as if you were the owner of your allocable portion of the Separate Account's assets. .. Possible limits on the number of investment funds available or the frequency of transfers among them. .. Possible changes in the tax treatment of Policy benefits and rights. To the extent permitted under the federal tax law, we may claim the benefit of certain foreign tax credits attributable to taxes paid by certain Funds to foreign jurisdictions. THE COMPANY'S INCOME TAXES Under current federal income tax law we are not taxed on the Separate Account's operations. Thus, currently we do not deduct a charge from the Separate Account for company federal income taxes. (We do deduct a charge for federal taxes from premiums.) We reserve the right to charge the Separate Account for any future federal income taxes we may incur. Under current laws we may incur state and local taxes (in addition to premium taxes). These taxes are not now significant and we are not currently charging for them. If they increase, we may deduct charges for such taxes. We may be entitled to certain tax benefits related to the assets of the Separate Account. These tax benefits which may include foreign tax credits and corporate dividends received deductions, are not passed back to the Separate Account or to Policy owners since we are the owner of the assets from which the tax benefits are derived. RIGHTS WE RESERVE We reserve the right to make certain changes if we believe the changes are in the best interest of our Policy owners or would help carry out the purposes of the Policy. We will make these changes in the manner permitted by applicable 57 law and only after getting any necessary owner and regulatory approval. We will notify you of any changes that result in a material change in the underlying investments in the investment divisions, and you will have a chance to transfer out of the affected division (without charge). Some of the changes we may make include: .. Operating the Separate Account in any other form that is permitted by applicable law. .. Changes to obtain or continue exemptions from the 1940 Act. .. Transferring assets among investment divisions or to other separate accounts, or our general account or combining or removing investment divisions from the Separate Account. .. Substituting Fund shares in an investment division for shares of another portfolio of a Fund or another fund or investment permitted by law. .. Changing the way we assess charges without exceeding the aggregate amount of the Policy's guaranteed maximum charges. .. Making any necessary technical changes to the Policy to conform it to the changes we have made. Some such changes might require us to obtain regulatory or Policy owner approval. Whether regulatory or Policy owner approval is required would depend on the nature of the change and, in many cases, the manner in which the change is implemented. You should not assume, therefore, that you necessarily will have an opportunity to approve or disapprove any such changes. Circumstances that could influence our determination to make any change might include changes in law or interpretations thereof; changes in financial or investment market conditions; changes in accepted methods of conducting operations in the relevant market; or a desire to achieve material operating economies or efficiencies. OTHER POLICY PROVISIONS [SIDEBAR: CAREFULLY REVIEW YOUR POLICY, WHICH CONTAINS A FULL DISCUSSION OF ALL ITS PROVISIONS.] FREE LOOK PERIOD You can return the Policy during this period. The period ends on the later of: .. 10 days after you receive the Policy (unless state law requires a longer period); and .. the date we receive a receipt signed by you. If you return your Policy, we will send you a complete refund of any premiums paid (or cash value plus any charges deducted if state law requires) within seven days. FOR POLICIES ISSUED IN CALIFORNIA: If you are age 60 or older, you may cancel the Policy within 30 days after you receive it. If you elected on the Policy application to allocate 100% of your initial net premium to the BlackRock Money Market investment division, we will refund the premiums you paid; if you elected to allocate your initial net premium to the other investment divisions and/or the Fixed Account, we will refund the Policy's cash value. SUICIDE If the insured commits suicide within the first two Policy years (or any other period required by state law), your beneficiary will receive all premiums paid (without interest), less any outstanding loans (plus accrued interest) and withdrawals taken. Similarly, we will pay the beneficiary only the cost of any increase in specified face amount if the insured commits suicide within two years of such increase. 58 ASSIGNMENT AND CHANGE IN OWNERSHIP You can assign your Policy as collateral if you notify us in writing. The assignment or release of the assignment is effective when it is recorded at the Designated Office. We are not responsible for determining the validity of the assignment or its release. Also, there could be serious adverse tax consequences to you or your beneficiary, so you should consult with your tax adviser before making any change of ownership or other assignment. REPORTS Generally, you will promptly receive statements confirming your significant transactions such as: .. Change in specified face amount. .. Change in death benefit option. .. Transfers among investment divisions (including those through Systematic Investment Strategies, which are confirmed quarterly). .. Partial withdrawals. .. Loan amounts you request. .. Loan repayments and premium payments. If your premium payments are made through a systematic payment method, we will not send you any confirmation in addition to the one you receive from your employer. We will also send you an annual statement within 30 days after a Policy year. That statement will summarize the year's transactions and include information on: .. Deductions and charges. .. Status of the death benefit. .. Cash and cash surrender values. .. Amounts in the investment divisions and Fixed Account. .. Status of Policy loans. .. Automatic loans to pay interest. .. Information on your modified endowment contract status (if applicable). We will also send you a Fund's annual and semi-annual reports to shareholders. WHEN YOUR REQUESTS BECOME EFFECTIVE Generally, requests, premium payments and other instructions and notifications are effective on the Date of Receipt. In those cases, the effective time is at the end of the Valuation Period during which we receive them at our Designated Office. (Some exceptions to this general rule are noted below and elsewhere in this Prospectus.) A Valuation Period is the period between two successive Valuation Dates. It begins at the close of regular trading on the New York Stock Exchange on a Valuation Date and ends at the close of regular trading on the New York Stock Exchange on the next succeeding Valuation Date. The close of regular trading is 4:00 p.m., Eastern Time on most days. Valuation Date is each day on which the New York Stock Exchange is open for trading. Accordingly, if we receive your request, premium, or instructions after the close of regular trading on the New York Stock Exchange, or if the New York Stock Exchange is not open that day, then we will treat it as received on the 59 next day when the New York Stock Exchange is open. These rules apply regardless of the reason we did not receive your request, premium, or instructions by the close of regular trading on the New York Stock Exchange, even if due to our delay (such as a delay in answering your telephone call). The end of the free look period is the effective time of the premium allocation instructions you make in your Policy application (and any changes in allocation or transfer requests you make on or before the end of the free look period). Your Investment Start Date is the date the first net premium is applied to the Fixed Account and/or the Separate Account and is the later of (1) the Date of Policy and (2) the Date of Receipt of your first premium payment. The effective date of your Systematic Investment Strategies will be that set forth in the strategy chosen. THIRD PARTY REQUESTS Generally, we accept requests for transactions or information only from you. Therefore, we reserve the right not to process transactions requested on your behalf by your agent with a power of attorney or any other authorization. This includes processing transactions by an agent you designate, through a power of attorney or other authorization, who has the ability to control the amount and timing of transfers for a number of other Policy owners, and who simultaneously makes the same request or series of requests on behalf of other Policy owners. EXCHANGE PRIVILEGE If you decide that you no longer want to take advantage of the investment divisions in the Separate Account, you may transfer all of your money into the Fixed Account. No charge will be imposed on a transfer of your entire cash value (or the cash value attributable to a specified face amount increase) to the Fixed Account within the first 24 Policy months (or within 24 Policy months after a specified face amount increase you have requested, as applicable). In some states, in order to exercise your exchange privilege, you must transfer, without charge, the Policy cash value (or the portion attributable to a specified face amount increase) to a flexible premium fixed benefit life insurance policy that we make available. SALES OF POLICIES MetLife Investors Distribution Company ("MLIDC") is the principal underwriter and distributor of the Policies. MLIDC, which is our affiliate, is registered under the Securities Exchange Act of 1934 (the "'34 Act") as a broker-dealer and is a member of the Financial Industry Regulatory Authority ("FINRA"). FINRA provides background information about broker-dealers and their registered representatives through FINRA BrokerCheck. You may contact the FINRA BrokerCheck Hotline at 1-800-289-9999, or log on to www.finra.org. An investor brochure that includes information describing FINRA BrokerCheck is available through the Hotline or on-line. The Policies are sold through licensed life insurance sales representatives who are associated with our affiliates MetLife Securities, Inc. ("MSI") and New England Securities Corporation ("NES"). MSI and NES are registered with the SEC as broker-dealers under the '34 Act and are also members of FINRA. 60 The Policies may also be sold through licensed life insurance sales representatives associated with unaffiliated broker-dealers with which MLIDC enters into a selling agreement. We reimburse MLIDC for expenses MLIDC incurs in distributing the Policies, e.g., commissions payable to broker-dealers who sell the Policies, including our affiliated broker-dealers. The payments described below do not result in a charge against the Policy in addition to the charges already described elsewhere in this prospectus. We may require all or part of the compensation to be returned to us if you do not continue the Policy for at least five years. MetLife sales representatives are sales representatives registered through MSI and NES. MetLife sales representatives may be career sales representatives who are employees of MetLife or brokers who are not employees of MetLife. Our affiliated sales representatives must meet a minimum level of sales production in order to maintain their agent status with us. Sales representatives can meet the minimum level of sales production through sales of proprietary and/or non-proprietary products. (Proprietary products are those issued by us or our affiliates.) However, sales representatives can meet a lower alternative minimum level of sales production if the sales representative focuses on sales of proprietary products. Therefore, a sales representative may have an incentive to favor the sale of proprietary products. Moreover, because the managers who supervise the representatives receive a higher level of compensation based on sales of proprietary products, these sales managers have an incentive to promote the sale of proprietary products. Our affiliated sales representatives receive cash payments for the products they sell and service based on a "gross dealer concession" model. A sales representative is entitled to part or all of the gross dealer concession. The percentage to which the representative is entitled is determined by a sliding-scale formula that takes into account the total amount of proprietary and non-proprietary products sold and serviced by the representative. The gross dealer concession for the Policies varies based on the Policy year and on whether the amount of premiums paid in a Policy year is greater or less than the Policy's Target Premium. The Target Premium is shown in your Policy. In the first Policy year, the gross dealer concession is 28% of premiums paid up to the amount of the Target Premium, and 2.5% of premiums paid in excess of the Target Premium; in Policy years 2 through 4, the gross dealer concession is 8.25% of premiums paid up to the amount of the Target Premium and 2.5% of any excess; in Policy year 5 and later, the gross dealer concession is 2.5% of all premiums paid; and in Policy year 8 and thereafter a gross dealer concession of 0.1% is paid on the Policy's cash value. Under alternative schedules that are available, the gross dealer concession in the first Policy year ranges from 10% to 21% premiums paid up to the Target Premium and 2% of any excess; in Policy years 2 through 10, it ranges from 8.5% to 10% of premiums paid up to the Target Premium and 1.5% of any excess; in Policy years 11 and later, it is 3% of premiums paid up to the Target Premium and 1.5% of any excess; and in Policy years 8 and thereafter, a gross dealer concession ranging from 0.1% to 0.15% is paid on the Policy's cash value. 61 For Policies sold by representatives of unaffiliated broker-dealers, MLIDC pays commissions to the broker-dealer with which the representative is registered. The commissions paid to the broker-dealer are generally not expected to exceed, on a present value basis, the aggregate amount of compensation that is paid with respect to sales made through our sales representatives. (Total compensation includes payments that we make to our business unit or the business unit of our affiliate that is responsible for the operation of the distribution systems though which the Policy is sold.) Broker-dealers pay their sales representatives all or a portion of the commissions received for their sales of the Policies. The portion of the commissions that the broker-dealer passes through to its sales representatives is determined in accordance with the broker-dealer's internal compensation program. Those programs may also include other types of cash and non-cash compensation and other benefits. Sales representatives of these broker-dealers may also receive non-cash compensation pursuant to the firm's guidelines or directly from us or MLIDC. Our sales representatives and their managers may be eligible for additional cash compensation, such as bonuses and expense allowances (that may be tied to sales of specific products), equity awards (such as stock options), training allowances, supplemental compensation, product level add-ons controlled at the local and company levels, financing arrangements, special loan repayment options, marketing support, medical and other insurance benefits, and retirement benefits and other benefits. Since some of this additional compensation, in particular, life insurance, disability and retirement benefits, is based primarily on the amount of proprietary products sold, sales representatives and their managers have an incentive to favor the sale of proprietary products. Sales representatives who meet certain productivity, persistency, and length of service standards and/or their managers may be eligible for additional cash compensation. Moreover, managers may be eligible for additional cash compensation based on the sales production of the sales representatives that the manager supervises. The business unit responsible for the operation of our distribution system is also eligible to receive an amount of compensation. MetLife sales representatives and their managers (and the sales representatives and managers of our affiliates) are also eligible for various non-cash compensation programs that we offer such as conferences, trips, prizes, and awards. Other payments may be made for other services that do not directly involve the sale of products. These services may include the recruitment and training of personnel, production of promotional literature, and similar services. MLIDC also enters into selling agreements with other unaffiliated broker-dealers for the sale of the Policies and other variable insurance products, i.e., annuity contracts and life insurance policies, that we and our affiliates issue. MLIDC may pay additional compensation to certain of these broker-dealers, including marketing allowances, introduction fees, persistency payments, preferred status fees and industry conference fees. Marketing allowances are periodic payments to certain broker-dealers, the amount of which depends on cumulative periodic (usually quarterly) sales of our insurance products (including the Policies) and may also depend on meeting thresholds in the sale of certain of our insurance products (other than the Policies). They may also include payments we make to cover the cost of marketing or other support services provided for or by registered representatives who may sell our products. Introduction fees are payments to broker-dealers in connection with the addition of these variable products to the broker-dealer's line of investment 62 products, including expenses relating to establishing the data communications systems necessary for the broker-dealer to offer, sell and administer these products. Persistency payments are periodic payments based on account and/or cash values of these variable insurance products. Preferred status fees are paid to obtain preferred treatment of these products in broker-dealers' marketing programs, which may include marketing services, participation in marketing meetings, listings in data resources and increased access to their sales representatives. Industry conference fees are amounts paid to cover in part the costs associated with sales conferences and educational seminars for broker-dealers' sales representatives. The additional types of compensation discussed above are not offered to all broker-dealers. The terms of any particular agreement governing compensation may vary among broker-dealers and the amounts may be significant. We and MLIDC may enter into similar arrangements with our affiliates MSI and NES. The prospect of receiving, or the receipt of, additional compensation as described above may provide broker-dealers or their representatives with an incentive to favor sales of the Policies over other variable insurance policies (or other investments) with respect to which the broker-dealer does not receive additional compensation, or lower levels of additional compensation. You may wish to take such payment arrangements into account when considering and evaluating any recommendation relating to the Policies. For more information about any such arrangements, ask your sales representative for further information about what your sales representative and the broker-dealer for which he or she works may receive in connection with your purchase of a Policy. We retain consultants who provide technical training and sales support to MetLife and our other affiliated sales representatives with respect to certain business planning strategies that may involve the sale of life insurance. We pay these consultants fees that are not conditioned on the sale of any insurance products. These consultants may also provide services directly to our clients for a fee. We pay American Funds Distributors, Inc., the principal underwriter for the American Funds Insurance Series, a percentage of all premiums allocated to the American Funds Growth Fund, the American Funds International Fund, the American Funds High-Income Bond Fund and the American Funds U.S. Government/AAA Rated Securities Fund for the services it provides in marketing the Portfolios' shares in connection with the Policies. LEGAL PROCEEDINGS In the ordinary course of business, MetLife, similar to other life insurance companies, is involved in lawsuits (including class action lawsuits), arbitrations and other legal proceedings. Also, from time to time, state and federal regulators or other officials conduct formal and informal examinations or undertake other actions dealing with various aspects of the financial services and insurance industries. In some legal proceedings involving insurers, substantial damages have been sought and/or material settlement payments have been made. It is not possible to predict with certainty the ultimate outcome of any pending legal proceeding or regulatory action. However, MetLife does not believe any such action or proceeding will have a material adverse effect upon the Separate Account or upon the ability of MetLife Investors Distribution 63 Company to perform its contract with the Separate Account or of MetLife to meet its obligations under the Policies. RESTRICTIONS ON FINANCIAL TRANSACTIONS Applicable laws designed to counter terrorism and prevent money laundering might, in certain circumstances, require us to reject a premium payment and/ or block or "freeze" your Policy. If these laws apply in a particular situation, we would not be allowed to process any request for withdrawals, surrenders, or death benefits, make transfers, or continue making payments under your death benefit option until instructions are received from the appropriate regulator. We also may be required to provide additional information about you or your Policy to government regulators. FINANCIAL STATEMENTS The financial statements comprising each of the Investment Divisions of the Separate Account and the financial statements of MetLife can be found in the Statement of Additional Information. Our financial statements should be considered only as bearing upon our ability to meet our obligations under the Policy. 64 APPENDIX A ADDITIONAL INFORMATION REGARDING THE FUNDS Certain Portfolios were subject to a name change, merger, substitution, or share class exchange. The chart below identifies the former name and new name of these Portfolios, and where applicable, the former name and new name of the Fund of which the Portfolio is a part. PORTFOLIO NAME CHANGES FORMER NAME NEW NAME -------------------------------------- ------------------------------------- FRANKLIN TEMPLETON VARIABLE FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST INSURANCE PRODUCTS TRUST Mutual Global Discovery Securities Franklin Mutual Global Discovery Fund VIP Fund Templeton Foreign Securities Fund Templeton Foreign VIP Fund Templeton Global Bond Securities Templeton Global Bond VIP Fund Fund GOLDMAN SACHS VARIABLE INSURANCE GOLDMAN SACHS VARIABLE INSURANCE TRUST TRUST Goldman Sachs Structured Small Cap Goldman Sachs Small Cap Equity Equity Fund Insights Fund MET INVESTORS SERIES TRUST MET INVESTORS SERIES TRUST BlackRock Large Cap Core Portfolio WMC Large Cap Research Portfolio Lord Abbett Mid Cap Value Portfolio Invesco Mid Cap Value Portfolio MetLife Aggressive Strategy MetLife Asset Allocation 100 Portfolio Portfolio METROPOLITAN SERIES FUND METROPOLITAN SERIES FUND BlackRock Diversified Portfolio WMC Balanced Portfolio Davis Venture Value Portfolio WMC Core Equity Opportunities Portfolio MetLife Conservative Allocation MetLife Asset Allocation 20 Portfolio Portfolio MetLife Conservative to Moderate MetLife Asset Allocation 40 Allocation Portfolio Portfolio MetLife Moderate Allocation MetLife Asset Allocation 60 Portfolio Portfolio MetLife Moderate to Aggressive MetLife Asset Allocation 80 Allocation Portfolio Portfolio PORTFOLIO MERGERS FORMER FUND/PORTFOLIO NEW FUND/PORTFOLIO ------------------------------------- ------------------------------------- AMERICAN CENTURY VARIABLE AMERICAN CENTURY PORTFOLIOS, INC. VARIABLE PORTFOLIOS, INC. VP Vista Fund VP Capital Appreciation Fund MFS(R) VARIABLE INSURANCE TRUST MFS(R) VARIABLE INSURANCE TRUST II MFS(R) High Income Series MFS(R) High Yield Portfolio PORTFOLIO SUBSTITUTIONS FORMER FUND/PORTFOLIO NEW FUND/PORTFOLIO ------------------------------------- ------------------------------------- AIM VARIABLE INSURANCE FUNDS (INVESCO VARIABLE INSURANCE FUNDS) MET INVESTORS SERIES TRUST Invesco V.I. Global Real Estate Clarion Global Real Estate Fund Portfolio PIONEER VARIABLE CONTRACTS TRUST MET INVESTORS SERIES TRUST Pioneer Emerging Markets VCT MFS(R) Emerging Markets Equity Portfolio Portfolio SHARE CLASS EXCHANGE FORMER SHARE CLASS NEW SHARE CLASS ------------------------------------- ------------------------------------- MET INVESTORS SERIES TRUST MET INVESTORS SERIES TRUST Clarion Global Real Estate Clarion Global Real Estate Portfolio--Class B Portfolio-- Class A 65 In order to help you understand how the Policy's values would vary over time under different sets of assumptions, we will provide you with personalized illustrations of death benefits, cash surrender values and cash values upon request. These will be based on the age and insurance risk characteristics of the person insured under the Policy and such factors as the specified face amount, premium payment amounts and rates of return (within limits) that you request. You can request such illustrations at any time without charge. We have filed an example of such an illustration as an exhibit to the registration statement referred to below. Additional information about the Policy and the Separate Account can be found in the Statement of Additional Information. This Prospectus incorporates by reference all of the information contained in the Statement of Additional Information, which is legally part of this Prospectus. You may obtain, without charge, a copy of the Statement of Additional Information or a personalized illustration of death benefits, cash surrender values and cash values, by calling us at 1-908-253-1400 or contacting us through our website at www.metlife.com/sbr. Information about the Policy and the Separate Account, including the Statement of Additional Information, is available for viewing and copying at the SEC's Public Reference Room in Washington, D.C. Information about the operation of the public reference room may be obtained by calling the SEC at 202-942-8090. The Statement of Additional Information, reports and other information about the Separate Account are available on the SEC Internet site as www.sec.gov. Copies of this information may be obtained upon payment of a duplicating fee, by writing to the SEC's Public Reference Section at 100 F Street, NE, Washington, DC 20549. 811-06025 66 METFLEX A FLEXIBLE PREMIUM VARIABLE LIFE INSURANCE POLICY METROPOLITAN LIFE SEPARATE ACCOUNT UL ISSUED BY METROPOLITAN LIFE INSURANCE COMPANY STATEMENT OF ADDITIONAL INFORMATION APRIL 28, 2014 This Statement of Additional Information is not a prospectus. This Statement of Additional Information relates to the prospectus dated April 28, 2014 for MetFlex--A Flexible Premium Variable Life Insurance Policy. A copy of that prospectus may be obtained by writing to MetLife--SBR, 501 Route 22, Bridgewater, NJ 08807. B-1 TABLE OF CONTENTS The Company and the Separate Account....................... 3 Additional Information about the Operation of the Policies. 3 Limits to MetLife's Right to Challenge the Policy......... 3 Misstatement of Age or Sex................................ 3 Dividends................................................. 3 Payment and Deferment..................................... 3 Additional Information about Voting........................ 4 Additional Information about Sales of Policies............. 4 Independent Registered Public Accounting Firm.............. 5 Financial Statements....................................... 5
B-2 THE COMPANY AND THE SEPARATE ACCOUNT Metropolitan Life Insurance Company is a leading provider of insurance, annuities and employee benefit programs throughout the United States. The Company offers life insurance and annuities to individuals, as well as group insurance and retirement and savings products and other services to corporations and other institutions. MetLife was formed under the laws of New York in 1866. MetLife's principal executive office is located at 200 Park Avenue, New York, New York 10166-0188. MetLife is a wholly-owned subsidiary of MetLife, Inc. MetLife, Inc., through its subsidiaries and affiliates, is a leading global provider of insurance, annuities and employee benefit programs, serving 90 million customers. MetLife, Inc. holds leading market positions in the United States, Japan, Latin America, Asia, Europe and the Middle East. We established the Separate Account under New York law on December 13, 1988. The Separate Account receives premium payments from the Policies described in the Prospectus and other variable life insurance policies that we issue. We have registered the Separate Account as a unit investment trust under the Investment Company Act of 1940 (the "1940 Act"). For more information about MetLife, please visit our website at www.metlife.com --------------- ADDITIONAL INFORMATION ABOUT THE OPERATION OF THE POLICIES LIMITS TO METLIFE'S RIGHT TO CHALLENGE THE POLICY We will not contest: .. Your Policy after two Policy years from issue or reinstatement (excluding riders added later). .. An increase in a death benefit after it has been in effect for two years. MISSTATEMENT OF AGE OR SEX We will adjust benefits to reflect the correct age and sex of the insured, if this information isn't correct in the Policy application. DIVIDENDS The Policy is "nonparticipating," which means it is not eligible for dividends from us and does not share in any distributions of our surplus. PAYMENT AND DEFERMENT We can delay transfers, withdrawals, surrender and payment of Policy loans from the Fixed Account for up to six months. Generally, we will pay or transfer amounts from the Separate Account within seven days after the Date of Receipt of all necessary documentation required for such payment or transfer. We can defer this if: .. The New York Stock Exchange has an unscheduled closing. .. There is an emergency so that we could not reasonably determine the investment experience of a Policy. .. The Securities and Exchange determines that an emergency exists. .. The Securities and Exchange Commission by order permits us to do so for the protection of Policy owners (provided that the delay is permitted under New York State insurance law and regulations). .. With respect to the insurance proceeds, if entitlement to a payment is being questioned or is uncertain. .. We are paying amounts attributable to a check. In that case we can wait for a reasonable time (15 days or less) to let the check clear. We currently pay interest on the amount of insurance proceeds at 3% per year (or higher if state law requires) from the date of death until the date we pay the benefit. B-3 ADDITIONAL INFORMATION ABOUT VOTING If you are eligible to give us voting instructions, we will send you informational material and a form to send back to us. We are entitled to disregard voting instructions in certain limited circumstances prescribed by the SEC. If we do so, we will give you our reasons in the next semi-annual report to Policy owners. The number of shares for which you can give us voting instructions is determined as of the record date for the Fund shareholder meeting by dividing: .. Your Policy's cash value in the corresponding investment division; by .. The net asset value of one share of that Portfolio. We will count fractional votes. If we do not receive timely voting instructions from Policy owners and other insurance and annuity owners that are entitled to give us voting instructions, we will vote those shares in the same proportion as the shares held in the same separate account for which we did receive voting instructions. Also, we will vote Fund shares that are not attributable to insurance or annuity owners (including shares that we hold in our general account) or that are held in separate accounts that are not registered under the 1940 Act in the same proportion as the aggregate of the shares for which we received voting instructions from all insurance and annuity owners. ADDITIONAL INFORMATION ABOUT SALES OF POLICIES Information about the distribution of the Policies is contained in the prospectus. (See "Sales of Policies.") Additional information is provided below. The Policies are offered to the public on a continuous basis. We anticipate continuing to offer the Policies, but reserve the right to discontinue the offering. MetLife Investors Distribution Company ("MLIDC") serves as principal underwriter for the Policies. MLIDC is a Missouri corporation and its principal office is located at 1095 Avenue of the Americas, New York, NY 10036. MLIDC is an indirect wholly-owned subsidiary of MetLife, Inc. MLIDC is registered as a broker-dealer with the Securities and Exchange Commission under the Securities Exchange Act of 1934 and is a member of FINRA. MLIDC has entered into selling agreements with other broker-dealers and compensates them for their services. MLIDC received sales compensation with respect to the Policies in the following amounts during the periods indicated:
AGGREGATE AMOUNT OF AGGREGATE AMOUNT OF COMMISSIONS COMMISSION PAID TO RETAINED BY DISTRIBUTOR AFTER FISCAL YEAR DISTRIBUTOR PAYMENTS TO SELLING FIRMS ----------- ------------------- ------------------------------- 2013..... $1,424,904 $0 2012..... $1,380,694 $0 2011..... $2,024,576 $0
B-4 INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM The financial statements and financial highlights comprising each of the Investment Divisions of Metropolitan Life Separate Account UL included in this Statement of Additional Information, have been audited by Deloitte & Touche LLP, an independent registered public accounting firm, as stated in their report appearing herein. Such financial statements and financial highlights are included in reliance upon the report of such firm given upon their authority as experts in accounting and auditing. The consolidated financial statements and related financial statement schedules of Metropolitan Life Insurance Company and subsidiaries, included in this Statement of Additional Information, have been audited by Deloitte & Touche LLP, an independent registered public accounting firm, as stated in their report appearing herein. Such financial statements are included in reliance upon the report of such firm given upon their authority as experts in accounting and auditing. The principal business address of Deloitte & Touche LLP is 30 Rockefeller Plaza, New York, New York 10112-0015. FINANCIAL STATEMENTS The financial statements of the Separate Account and the financial statements of MetLife are attached. Our financial statements should be considered only as bearing upon our ability to meet our obligations under the Policy. B-5 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Policy Owners of Metropolitan Life Separate Account UL and Board of Directors of Metropolitan Life Insurance Company We have audited the accompanying statements of assets and liabilities of Metropolitan Life Separate Account UL (the "Separate Account") of Metropolitan Life Insurance Company (the "Company") comprising each of the individual Investment Divisions listed in Note 2.A as of December 31, 2013, the related statements of operations and changes in net assets for the respective stated periods in the three years then ended, and the financial highlights in Note 8 for the respective stated periods in the five years then ended. These financial statements and financial highlights are the responsibility of the Separate Account's management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits. We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. The Separate Account is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Separate Account's internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. Our procedures included confirmation of investments owned as of December 31, 2013, by correspondence with the custodian or mutual fund companies. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of each of the Investment Divisions constituting the Separate Account of the Company as of December 31, 2013, the results of their operations and changes in their net assets for the respective stated periods in the three years then ended, and the financial highlights for the respective stated periods in the five years then ended, in conformity with accounting principles generally accepted in the United States of America. /s/ DELOITTE & TOUCHE LLP Certified Public Accountants Tampa, Florida March 27, 2014 This page is intentionally left blank. METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF ASSETS AND LIABILITIES DECEMBER 31, 2013
ALLIANCEBERNSTEIN GLOBAL ALLIANCEBERNSTEIN AMERICAN AMERICAN FUNDS THEMATIC GROWTH INTERMEDIATE BOND CENTURY VP VISTA BOND INVESTMENT DIVISION INVESTMENT DIVISION INVESTMENT DIVISION INVESTMENT DIVISION --------------------- -------------------- --------------------- -------------------- ASSETS: Investments at fair value........... $ 66,166 $ 57,615 $ 710 $ 5,589,276 Due from Metropolitan Life Insurance Company................. -- -- -- -- --------------------- -------------------- --------------------- -------------------- Total Assets................... 66,166 57,615 710 5,589,276 --------------------- -------------------- --------------------- -------------------- LIABILITIES: Due to Metropolitan Life Insurance Company................. -- -- -- 1 --------------------- -------------------- --------------------- -------------------- Total Liabilities.............. -- -- -- 1 --------------------- -------------------- --------------------- -------------------- NET ASSETS............................. $ 66,166 $ 57,615 $ 710 $ 5,589,275 ===================== ==================== ===================== ====================
The accompanying notes are an integral part of these financial statements. 1 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF ASSETS AND LIABILITIES -- (CONTINUED) DECEMBER 31, 2013
AMERICAN FUNDS GLOBAL SMALL AMERICAN FUNDS AMERICAN FUNDS AMERICAN FUNDS CAPITALIZATION GROWTH GROWTH-INCOME HIGH-INCOME BOND INVESTMENT DIVISION INVESTMENT DIVISION INVESTMENT DIVISION INVESTMENT DIVISION -------------------- -------------------- -------------------- -------------------- ASSETS: Investments at fair value... $ 72,066,624 $ 160,553,256 $ 101,213,173 $ 17,547 Due from Metropolitan Life Insurance Company......... -- -- -- -- -------------------- -------------------- -------------------- -------------------- Total Assets........... 72,066,624 160,553,256 101,213,173 17,547 -------------------- -------------------- -------------------- -------------------- LIABILITIES: Due to Metropolitan Life Insurance Company......... 4 12 16 -- -------------------- -------------------- -------------------- -------------------- Total Liabilities...... 4 12 16 -- -------------------- -------------------- -------------------- -------------------- NET ASSETS..................... $ 72,066,620 $ 160,553,244 $ 101,213,157 $ 17,547 ==================== ==================== ==================== ==================== AMERICAN FUNDS U.S. AMERICAN FUNDS GOVERNMENT/AAA- DREYFUS VIF FIDELITY VIP ASSET INTERNATIONAL RATED SECURITIES INTERNATIONAL VALUE MANAGER: GROWTH INVESTMENT DIVISION INVESTMENT DIVISION INVESTMENT DIVISION INVESTMENT DIVISION -------------------- -------------------- -------------------- -------------------- ASSETS: Investments at fair value... $ 685,392 $ 46,484 $ 246,317 $ 1,929,922 Due from Metropolitan Life Insurance Company......... -- -- -- -- -------------------- -------------------- -------------------- -------------------- Total Assets........... 685,392 46,484 246,317 1,929,922 -------------------- -------------------- -------------------- -------------------- LIABILITIES: Due to Metropolitan Life Insurance Company......... -- -- -- -- -------------------- -------------------- -------------------- -------------------- Total Liabilities...... -- -- -- -- -------------------- -------------------- -------------------- -------------------- NET ASSETS..................... $ 685,392 $ 46,484 $ 246,317 $ 1,929,922 ==================== ==================== ==================== ==================== FIDELITY VIP FIDELITY VIP CONTRAFUND EQUITY-INCOME INVESTMENT DIVISION INVESTMENT DIVISION -------------------- -------------------- ASSETS: Investments at fair value... $ 2,650,302 $ 33,464 Due from Metropolitan Life Insurance Company......... -- -- -------------------- -------------------- Total Assets........... 2,650,302 33,464 -------------------- -------------------- LIABILITIES: Due to Metropolitan Life Insurance Company......... -- -- -------------------- -------------------- Total Liabilities...... -- -- -------------------- -------------------- NET ASSETS..................... $ 2,650,302 $ 33,464 ==================== ====================
The accompanying notes are an integral part of these financial statements. 2 The accompanying notes are an integral part of these financial statements. 3 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF ASSETS AND LIABILITIES -- (CONTINUED) DECEMBER 31, 2013
FIDELITY VIP FIDELITY VIP FIDELITY VIP FIDELITY VIP FREEDOM 2010 FREEDOM 2020 FREEDOM 2025 FREEDOM 2030 INVESTMENT DIVISION INVESTMENT DIVISION INVESTMENT DIVISION INVESTMENT DIVISION --------------------- -------------------- -------------------- --------------------- ASSETS: Investments at fair value... $ 46,242 $ 977,716 $ 40,181 $ 62,024 Due from Metropolitan Life Insurance Company......... -- -- -- -- --------------------- -------------------- -------------------- --------------------- Total Assets........... 46,242 977,716 40,181 62,024 --------------------- -------------------- -------------------- --------------------- LIABILITIES: Due to Metropolitan Life Insurance Company......... -- 1 -- -- --------------------- -------------------- -------------------- --------------------- Total Liabilities...... -- 1 -- -- --------------------- -------------------- -------------------- --------------------- NET ASSETS..................... $ 46,242 $ 977,715 $ 40,181 $ 62,024 ===================== ==================== ==================== ===================== FIDELITY VIP FIDELITY VIP FIDELITY VIP FIDELITY VIP INVESTMENT FREEDOM 2040 FREEDOM 2050 HIGH INCOME GRADE BOND INVESTMENT DIVISION INVESTMENT DIVISION INVESTMENT DIVISION INVESTMENT DIVISION -------------------- --------------------- --------------------- -------------------- ASSETS: Investments at fair value... $ 11,831 $ 22,014 $ 167,992 $ 1,700,205 Due from Metropolitan Life Insurance Company......... -- -- -- -- -------------------- --------------------- --------------------- -------------------- Total Assets........... 11,831 22,014 167,992 1,700,205 -------------------- --------------------- --------------------- -------------------- LIABILITIES: Due to Metropolitan Life Insurance Company......... -- -- -- -- -------------------- --------------------- --------------------- -------------------- Total Liabilities...... -- -- -- -- -------------------- --------------------- --------------------- -------------------- NET ASSETS..................... $ 11,831 $ 22,014 $ 167,992 $ 1,700,205 ==================== ===================== ===================== ==================== FTVIPT FRANKLIN INCOME FIDELITY VIP MID CAP SECURITIES INVESTMENT DIVISION INVESTMENT DIVISION -------------------- -------------------- ASSETS: Investments at fair value... $ 249,087 $ 618 Due from Metropolitan Life Insurance Company......... -- -- -------------------- -------------------- Total Assets........... 249,087 618 -------------------- -------------------- LIABILITIES: Due to Metropolitan Life Insurance Company......... -- -- -------------------- -------------------- Total Liabilities...... -- -- -------------------- -------------------- NET ASSETS..................... $ 249,087 $ 618 ==================== ====================
The accompanying notes are an integral part of these financial statements. 4 The accompanying notes are an integral part of these financial statements. 5 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF ASSETS AND LIABILITIES -- (CONTINUED) DECEMBER 31, 2013
FTVIPT FTVIPT FTVIPT MUTUAL GLOBAL MUTUAL SHARES FTVIPT TEMPLETON TEMPLETON GLOBAL DISCOVERY SECURITIES SECURITIES FOREIGN SECURITIES BOND SECURITIES INVESTMENT DIVISION INVESTMENT DIVISION INVESTMENT DIVISION INVESTMENT DIVISION -------------------- -------------------- --------------------- --------------------- ASSETS: Investments at fair value... $ 494,934 $ 24,208 $ 4,405,695 $ 1,317,714 Due from Metropolitan Life Insurance Company......... -- -- -- -- -------------------- -------------------- --------------------- --------------------- Total Assets........... 494,934 24,208 4,405,695 1,317,714 -------------------- -------------------- --------------------- --------------------- LIABILITIES: Due to Metropolitan Life Insurance Company......... -- -- 1 -- -------------------- -------------------- --------------------- --------------------- Total Liabilities...... -- -- 1 -- -------------------- -------------------- --------------------- --------------------- NET ASSETS..................... $ 494,934 $ 24,208 $ 4,405,694 $ 1,317,714 ==================== ==================== ===================== ===================== GOLDMAN SACHS GOLDMAN SACHS STRUCTURED INVESCO V.I. INVESCO V.I. MID-CAP VALUE SMALL CAP EQUITY COMSTOCK GLOBAL REAL ESTATE INVESTMENT DIVISION INVESTMENT DIVISION INVESTMENT DIVISION INVESTMENT DIVISION --------------------- --------------------- -------------------- -------------------- ASSETS: Investments at fair value... $ 295,859 $ 41,480 $ 315,275 $ 2,585,663 Due from Metropolitan Life Insurance Company......... -- -- -- 15 --------------------- --------------------- -------------------- -------------------- Total Assets........... 295,859 41,480 315,275 2,585,678 --------------------- --------------------- -------------------- -------------------- LIABILITIES: Due to Metropolitan Life Insurance Company......... -- -- -- -- --------------------- --------------------- -------------------- -------------------- Total Liabilities...... -- -- -- -- --------------------- --------------------- -------------------- -------------------- NET ASSETS..................... $ 295,859 $ 41,480 $ 315,275 $ 2,585,678 ===================== ===================== ==================== ==================== INVESCO V.I. GOVERNMENT INVESCO V.I. SECURITIES INTERNATIONAL GROWTH INVESTMENT DIVISION INVESTMENT DIVISION --------------------- -------------------- ASSETS: Investments at fair value... $ 11,016 $ 399,191 Due from Metropolitan Life Insurance Company......... -- -- --------------------- -------------------- Total Assets........... 11,016 399,191 --------------------- -------------------- LIABILITIES: Due to Metropolitan Life Insurance Company......... -- -- --------------------- -------------------- Total Liabilities...... -- -- --------------------- -------------------- NET ASSETS..................... $ 11,016 $ 399,191 ===================== ====================
The accompanying notes are an integral part of these financial statements. 6 The accompanying notes are an integral part of these financial statements. 7 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF ASSETS AND LIABILITIES -- (CONTINUED) DECEMBER 31, 2013
JANUS ASPEN BALANCED JANUS ASPEN FORTY JANUS ASPEN JANUS JANUS ASPEN OVERSEAS INVESTMENT DIVISION INVESTMENT DIVISION INVESTMENT DIVISION INVESTMENT DIVISION -------------------- -------------------- -------------------- -------------------- ASSETS: Investments at fair value... $ 992,702 $ 870,003 $ 439,285 $ 68,836 Due from Metropolitan Life Insurance Company......... -- -- -- -- -------------------- -------------------- -------------------- -------------------- Total Assets........... 992,702 870,003 439,285 68,836 -------------------- -------------------- -------------------- -------------------- LIABILITIES: Due to Metropolitan Life Insurance Company......... -- -- -- -- -------------------- -------------------- -------------------- -------------------- Total Liabilities...... -- -- -- -- -------------------- -------------------- -------------------- -------------------- NET ASSETS..................... $ 992,702 $ 870,003 $ 439,285 $ 68,836 ==================== ==================== ==================== ==================== MFS VIT MFS VIT MFS VIT MFS VIT II GLOBAL EQUITY NEW DISCOVERY VALUE HIGH YIELD INVESTMENT DIVISION INVESTMENT DIVISION INVESTMENT DIVISION INVESTMENT DIVISION -------------------- -------------------- -------------------- --------------------- ASSETS: Investments at fair value... $ 185,320 $ 230,115 $ 21,702 $ 149,361 Due from Metropolitan Life Insurance Company......... -- -- -- -- -------------------- -------------------- -------------------- --------------------- Total Assets........... 185,320 230,115 21,702 149,361 -------------------- -------------------- -------------------- --------------------- LIABILITIES: Due to Metropolitan Life Insurance Company......... -- -- -- -- -------------------- -------------------- -------------------- --------------------- Total Liabilities...... -- -- -- -- -------------------- -------------------- -------------------- --------------------- NET ASSETS..................... $ 185,320 $ 230,115 $ 21,702 $ 149,361 ==================== ==================== ==================== ===================== MIST ALLIANCEBERNSTEIN MIST GLOBAL DYNAMIC AMERICAN FUNDS ALLOCATION BALANCED ALLOCATION INVESTMENT DIVISION INVESTMENT DIVISION -------------------- -------------------- ASSETS: Investments at fair value... $ 34,236 $ 790,263 Due from Metropolitan Life Insurance Company......... -- -- -------------------- -------------------- Total Assets........... 34,236 790,263 -------------------- -------------------- LIABILITIES: Due to Metropolitan Life Insurance Company......... -- -- -------------------- -------------------- Total Liabilities...... -- -- -------------------- -------------------- NET ASSETS..................... $ 34,236 $ 790,263 ==================== ====================
The accompanying notes are an integral part of these financial statements. 8 The accompanying notes are an integral part of these financial statements. 9 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF ASSETS AND LIABILITIES -- (CONTINUED) DECEMBER 31, 2013
MIST MIST MIST MIST BLACKROCK AMERICAN FUNDS AMERICAN FUNDS AQR GLOBAL GLOBAL TACTICAL GROWTH ALLOCATION MODERATE ALLOCATION RISK BALANCED STRATEGIES INVESTMENT DIVISION INVESTMENT DIVISION INVESTMENT DIVISION INVESTMENT DIVISION -------------------- -------------------- -------------------- -------------------- ASSETS: Investments at fair value... $ 1,490,834 $ 874,921 $ 152,914 $ 102,574 Due from Metropolitan Life Insurance Company......... -- -- -- -- -------------------- -------------------- -------------------- -------------------- Total Assets........... 1,490,834 874,921 152,914 102,574 -------------------- -------------------- -------------------- -------------------- LIABILITIES: Due to Metropolitan Life Insurance Company......... -- -- -- -- -------------------- -------------------- -------------------- -------------------- Total Liabilities...... -- -- -- -- -------------------- -------------------- -------------------- -------------------- NET ASSETS..................... $ 1,490,834 $ 874,921 $ 152,914 $ 102,574 ==================== ==================== ==================== ==================== MIST BLACKROCK MIST CLARION MIST CLEARBRIDGE MIST CLEARBRIDGE LARGE CAP CORE GLOBAL REAL ESTATE AGGRESSIVE GROWTH II AGGRESSIVE GROWTH INVESTMENT DIVISION INVESTMENT DIVISION INVESTMENT DIVISION INVESTMENT DIVISION -------------------- -------------------- -------------------- -------------------- ASSETS: Investments at fair value... $ 385,342,754 $ 27,497,717 $ 18,676,047 $ 21,684,931 Due from Metropolitan Life Insurance Company......... 191 -- -- 14 -------------------- -------------------- -------------------- -------------------- Total Assets........... 385,342,945 27,497,717 18,676,047 21,684,945 -------------------- -------------------- -------------------- -------------------- LIABILITIES: Due to Metropolitan Life Insurance Company......... -- 2 6 -- -------------------- -------------------- -------------------- -------------------- Total Liabilities...... -- 2 6 -- -------------------- -------------------- -------------------- -------------------- NET ASSETS..................... $ 385,342,945 $ 27,497,715 $ 18,676,041 $ 21,684,945 ==================== ==================== ==================== ==================== MIST MIST INVESCO HARRIS OAKMARK BALANCED-RISK INTERNATIONAL ALLOCATION INVESTMENT DIVISION INVESTMENT DIVISION ------------------- ------------------- ASSETS: Investments at fair value... $ 52,830,769 $ 24,724 Due from Metropolitan Life Insurance Company......... 5 -- ------------------- ------------------- Total Assets........... 52,830,774 24,724 ------------------- ------------------- LIABILITIES: Due to Metropolitan Life Insurance Company......... -- 1 ------------------- ------------------- Total Liabilities...... -- 1 ------------------- ------------------- NET ASSETS..................... $ 52,830,774 $ 24,723 =================== ===================
The accompanying notes are an integral part of these financial statements. 10 The accompanying notes are an integral part of these financial statements. 11 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF ASSETS AND LIABILITIES -- (CONTINUED) DECEMBER 31, 2013
MIST JPMORGAN MIST INVESCO MIST INVESCO GLOBAL ACTIVE MIST JPMORGAN MID CAP VALUE SMALL CAP GROWTH ALLOCATION SMALL CAP VALUE INVESTMENT DIVISION INVESTMENT DIVISION INVESTMENT DIVISION INVESTMENT DIVISION -------------------- -------------------- -------------------- -------------------- ASSETS: Investments at fair value... $ 92,130,244 $ 6,613,285 $ 110,413 $ 254,799 Due from Metropolitan Life Insurance Company......... 365 -- -- -- -------------------- -------------------- -------------------- -------------------- Total Assets........... 92,130,609 6,613,285 110,413 254,799 -------------------- -------------------- -------------------- -------------------- LIABILITIES: Due to Metropolitan Life Insurance Company......... -- 57 -- -- -------------------- -------------------- -------------------- -------------------- Total Liabilities...... -- 57 -- -- -------------------- -------------------- -------------------- -------------------- NET ASSETS..................... $ 92,130,609 $ 6,613,228 $ 110,413 $ 254,799 ==================== ==================== ==================== ==================== MIST LOOMIS SAYLES MIST LORD ABBETT MIST MET/TEMPLETON MIST METLIFE GLOBAL MARKETS BOND DEBENTURE INTERNATIONAL BOND AGGRESSIVE STRATEGY INVESTMENT DIVISION INVESTMENT DIVISION INVESTMENT DIVISION INVESTMENT DIVISION -------------------- -------------------- -------------------- -------------------- ASSETS: Investments at fair value... $ 418,253 $ 29,124,212 $ 86,776 $ 19,271,454 Due from Metropolitan Life Insurance Company......... 7 -- -- -- -------------------- -------------------- -------------------- -------------------- Total Assets........... 418,260 29,124,212 86,776 19,271,454 -------------------- -------------------- -------------------- -------------------- LIABILITIES: Due to Metropolitan Life Insurance Company......... -- 98 -- 2 -------------------- -------------------- -------------------- -------------------- Total Liabilities...... -- 98 -- 2 -------------------- -------------------- -------------------- -------------------- NET ASSETS..................... $ 418,260 $ 29,124,114 $ 86,776 $ 19,271,452 ==================== ==================== ==================== ==================== MIST METLIFE MIST METLIFE BALANCED PLUS GROWTH STRATEGY INVESTMENT DIVISION INVESTMENT DIVISION -------------------- -------------------- ASSETS: Investments at fair value... $ 94,166 $ 382,762 Due from Metropolitan Life Insurance Company......... -- -- -------------------- -------------------- Total Assets........... 94,166 382,762 -------------------- -------------------- LIABILITIES: Due to Metropolitan Life Insurance Company......... -- -- -------------------- -------------------- Total Liabilities...... -- -- -------------------- -------------------- NET ASSETS..................... $ 94,166 $ 382,762 ==================== ====================
The accompanying notes are an integral part of these financial statements. 12 The accompanying notes are an integral part of these financial statements. 13 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF ASSETS AND LIABILITIES -- (CONTINUED) DECEMBER 31, 2013
MIST METLIFE MIST MIST MULTI-INDEX MFS EMERGING MIST MFS RESEARCH MORGAN STANLEY TARGETED RISK MARKETS EQUITY INTERNATIONAL MID CAP GROWTH INVESTMENT DIVISION INVESTMENT DIVISION INVESTMENT DIVISION INVESTMENT DIVISION -------------------- -------------------- -------------------- ------------------- ASSETS: Investments at fair value... $ 2,679 $ 272,836 $ 21,367,745 $ 244,413,957 Due from Metropolitan Life Insurance Company......... -- -- -- 2 -------------------- -------------------- -------------------- ------------------- Total Assets........... 2,679 272,836 21,367,745 244,413,959 -------------------- -------------------- -------------------- ------------------- LIABILITIES: Due to Metropolitan Life Insurance Company......... -- -- 4 -- -------------------- -------------------- -------------------- ------------------- Total Liabilities...... -- -- 4 -- -------------------- -------------------- -------------------- ------------------- NET ASSETS..................... $ 2,679 $ 272,836 $ 21,367,741 $ 244,413,959 ==================== ==================== ==================== =================== MIST MIST OPPENHEIMER PIMCO INFLATION MIST PIMCO GLOBAL EQUITY PROTECTED BOND TOTAL RETURN MIST PIONEER FUND INVESTMENT DIVISION INVESTMENT DIVISION INVESTMENT DIVISION INVESTMENT DIVISION -------------------- -------------------- -------------------- ------------------- ASSETS: Investments at fair value... $ 50,487,094 $ 11,213,501 $ 49,962,748 $ 204,562 Due from Metropolitan Life Insurance Company......... -- -- -- -- -------------------- -------------------- -------------------- ------------------- Total Assets........... 50,487,094 11,213,501 49,962,748 204,562 -------------------- -------------------- -------------------- ------------------- LIABILITIES: Due to Metropolitan Life Insurance Company......... 209 1 1 -- -------------------- -------------------- -------------------- ------------------- Total Liabilities...... 209 1 1 -- -------------------- -------------------- -------------------- ------------------- NET ASSETS..................... $ 50,486,885 $ 11,213,500 $ 49,962,747 $ 204,562 ==================== ==================== ==================== =================== MIST PYRAMIS MIST SCHRODERS MANAGED RISK GLOBAL MULTI-ASSET INVESTMENT DIVISION INVESTMENT DIVISION -------------------- -------------------- ASSETS: Investments at fair value... $ 298 $ 22,665 Due from Metropolitan Life Insurance Company......... -- -- -------------------- -------------------- Total Assets........... 298 22,665 -------------------- -------------------- LIABILITIES: Due to Metropolitan Life Insurance Company......... -- -- -------------------- -------------------- Total Liabilities...... -- -- -------------------- -------------------- NET ASSETS..................... $ 298 $ 22,665 ==================== ====================
The accompanying notes are an integral part of these financial statements. 14 The accompanying notes are an integral part of these financial statements. 15 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF ASSETS AND LIABILITIES -- (CONTINUED) DECEMBER 31, 2013
MIST SSGA GROWTH MIST SSGA MIST T. ROWE PRICE MIST T. ROWE PRICE AND INCOME ETF GROWTH ETF LARGE CAP VALUE MID CAP GROWTH INVESTMENT DIVISION INVESTMENT DIVISION INVESTMENT DIVISION INVESTMENT DIVISION -------------------- -------------------- -------------------- -------------------- ASSETS: Investments at fair value... $ 7,827,726 $ 5,570,222 $ 2,025,987 $ 27,748,658 Due from Metropolitan Life Insurance Company......... -- -- -- -- -------------------- -------------------- -------------------- -------------------- Total Assets........... 7,827,726 5,570,222 2,025,987 27,748,658 -------------------- -------------------- -------------------- -------------------- LIABILITIES: Due to Metropolitan Life Insurance Company......... 2 2 -- 2 -------------------- -------------------- -------------------- -------------------- Total Liabilities...... 2 2 -- 2 -------------------- -------------------- -------------------- -------------------- NET ASSETS..................... $ 7,827,724 $ 5,570,220 $ 2,025,987 $ 27,748,656 ==================== ==================== ==================== ==================== MIST THIRD AVENUE MSF BAILLIE GIFFORD MSF BARCLAYS MSF BLACKROCK SMALL CAP VALUE INTERNATIONAL STOCK AGGREGATE BOND INDEX BOND INCOME INVESTMENT DIVISION INVESTMENT DIVISION INVESTMENT DIVISION INVESTMENT DIVISION -------------------- -------------------- -------------------- -------------------- ASSETS: Investments at fair value... $ 957,820 $ 44,856,332 $ 121,423,837 $ 81,249,810 Due from Metropolitan Life Insurance Company......... -- 8 29 -- -------------------- -------------------- -------------------- -------------------- Total Assets........... 957,820 44,856,340 121,423,866 81,249,810 -------------------- -------------------- -------------------- -------------------- LIABILITIES: Due to Metropolitan Life Insurance Company......... -- -- -- 7 -------------------- -------------------- -------------------- -------------------- Total Liabilities...... -- -- -- 7 -------------------- -------------------- -------------------- -------------------- NET ASSETS..................... $ 957,820 $ 44,856,340 $ 121,423,866 $ 81,249,803 ==================== ==================== ==================== ==================== MSF BLACKROCK MSF BLACKROCK CAPITAL APPRECIATION DIVERSIFIED INVESTMENT DIVISION INVESTMENT DIVISION -------------------- -------------------- ASSETS: Investments at fair value... $ 20,880,184 $ 302,812,142 Due from Metropolitan Life Insurance Company......... -- 11 -------------------- -------------------- Total Assets........... 20,880,184 302,812,153 -------------------- -------------------- LIABILITIES: Due to Metropolitan Life Insurance Company......... 4 -- -------------------- -------------------- Total Liabilities...... 4 -- -------------------- -------------------- NET ASSETS..................... $ 20,880,180 $ 302,812,153 ==================== ====================
The accompanying notes are an integral part of these financial statements. 16 The accompanying notes are an integral part of these financial statements. 17 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF ASSETS AND LIABILITIES -- (CONTINUED) DECEMBER 31, 2013
MSF BLACKROCK MSF BLACKROCK MSF DAVIS MSF FRONTIER LARGE CAP VALUE MONEY MARKET VENTURE VALUE MID CAP GROWTH INVESTMENT DIVISION INVESTMENT DIVISION INVESTMENT DIVISION INVESTMENT DIVISION -------------------- -------------------- -------------------- -------------------- ASSETS: Investments at fair value... $ 18,457,577 $ 23,781,884 $ 72,729,711 $ 227,973,849 Due from Metropolitan Life Insurance Company......... -- -- -- 173 -------------------- -------------------- -------------------- -------------------- Total Assets........... 18,457,577 23,781,884 72,729,711 227,974,022 -------------------- -------------------- -------------------- -------------------- LIABILITIES: Due to Metropolitan Life Insurance Company......... 2 5 8 -- -------------------- -------------------- -------------------- -------------------- Total Liabilities...... 2 5 8 -- -------------------- -------------------- -------------------- -------------------- NET ASSETS..................... $ 18,457,575 $ 23,781,879 $ 72,729,703 $ 227,974,022 ==================== ==================== ==================== ==================== MSF JENNISON MSF LOOMIS SAYLES MSF LOOMIS SAYLES MSF MET/ARTISAN GROWTH SMALL CAP CORE SMALL CAP GROWTH MID CAP VALUE INVESTMENT DIVISION INVESTMENT DIVISION INVESTMENT DIVISION INVESTMENT DIVISION -------------------- ------------------- -------------------- -------------------- ASSETS: Investments at fair value... $ 21,754,142 $ 25,008,784 $ 12,136,658 $ 64,604,733 Due from Metropolitan Life Insurance Company......... -- -- -- 7 -------------------- ------------------- -------------------- -------------------- Total Assets........... 21,754,142 25,008,784 12,136,658 64,604,740 -------------------- ------------------- -------------------- -------------------- LIABILITIES: Due to Metropolitan Life Insurance Company......... 16 26 1 -- -------------------- ------------------- -------------------- -------------------- Total Liabilities...... 16 26 1 -- -------------------- ------------------- -------------------- -------------------- NET ASSETS..................... $ 21,754,126 $ 25,008,758 $ 12,136,657 $ 64,604,740 ==================== =================== ==================== ==================== MSF METLIFE MSF METLIFE CONSERVATIVE CONSERVATIVE TO ALLOCATION MODERATE ALLOCATION INVESTMENT DIVISION INVESTMENT DIVISION -------------------- -------------------- ASSETS: Investments at fair value... $ 5,157,555 $ 9,308,534 Due from Metropolitan Life Insurance Company......... -- -- -------------------- -------------------- Total Assets........... 5,157,555 9,308,534 -------------------- -------------------- LIABILITIES: Due to Metropolitan Life Insurance Company......... 2 2 -------------------- -------------------- Total Liabilities...... 2 2 -------------------- -------------------- NET ASSETS..................... $ 5,157,553 $ 9,308,532 ==================== ====================
The accompanying notes are an integral part of these financial statements. 18 The accompanying notes are an integral part of these financial statements. 19 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF ASSETS AND LIABILITIES -- (CONTINUED) DECEMBER 31, 2013
MSF METLIFE MSF METLIFE MSF METLIFE MODERATE TO MSF METLIFE MID CAP STOCK INDEX MODERATE ALLOCATION AGGRESSIVE ALLOCATION STOCK INDEX INVESTMENT DIVISION INVESTMENT DIVISION INVESTMENT DIVISION INVESTMENT DIVISION -------------------- -------------------- --------------------- -------------------- ASSETS: Investments at fair value... $ 96,112,735 $ 51,418,737 $ 93,658,358 $ 926,254,629 Due from Metropolitan Life Insurance Company......... -- -- -- 305 -------------------- -------------------- --------------------- -------------------- Total Assets........... 96,112,735 51,418,737 93,658,358 926,254,934 -------------------- -------------------- --------------------- -------------------- LIABILITIES: Due to Metropolitan Life Insurance Company......... 8 7,672 2 -- -------------------- -------------------- --------------------- -------------------- Total Liabilities...... 8 7,672 2 -- -------------------- -------------------- --------------------- -------------------- NET ASSETS..................... $ 96,112,727 $ 51,411,065 $ 93,658,356 $ 926,254,934 ==================== ==================== ===================== ==================== MSF MFS MSF MSCI MSF NEUBERGER TOTAL RETURN MSF MFS VALUE EAFE INDEX BERMAN GENESIS INVESTMENT DIVISION INVESTMENT DIVISION INVESTMENT DIVISION INVESTMENT DIVISION -------------------- -------------------- -------------------- -------------------- ASSETS: Investments at fair value... $ 9,566,040 $ 83,882,349 $ 81,042,866 $ 113,031,572 Due from Metropolitan Life Insurance Company......... -- -- -- -- -------------------- -------------------- -------------------- -------------------- Total Assets........... 9,566,040 83,882,349 81,042,866 113,031,572 -------------------- -------------------- -------------------- -------------------- LIABILITIES: Due to Metropolitan Life Insurance Company......... 11 168 8 97 -------------------- -------------------- -------------------- -------------------- Total Liabilities...... 11 168 8 97 -------------------- -------------------- -------------------- -------------------- NET ASSETS..................... $ 9,566,029 $ 83,882,181 $ 81,042,858 $ 113,031,475 ==================== ==================== ==================== ==================== MSF RUSSELL 2000 MSF T. ROWE PRICE INDEX LARGE CAP GROWTH INVESTMENT DIVISION INVESTMENT DIVISION -------------------- -------------------- ASSETS: Investments at fair value... $ 72,232,091 $ 80,321,724 Due from Metropolitan Life Insurance Company......... -- 5,584 -------------------- -------------------- Total Assets........... 72,232,091 80,327,308 -------------------- -------------------- LIABILITIES: Due to Metropolitan Life Insurance Company......... 3 -- -------------------- -------------------- Total Liabilities...... 3 -- -------------------- -------------------- NET ASSETS..................... $ 72,232,088 $ 80,327,308 ==================== ====================
The accompanying notes are an integral part of these financial statements. 20 The accompanying notes are an integral part of these financial statements. 21 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF ASSETS AND LIABILITIES -- (CONTINUED) DECEMBER 31, 2013
MSF WESTERN MSF VAN ECK ASSET MANAGEMENT MSF WESTERN MSF T. ROWE PRICE GLOBAL NATURAL STRATEGIC BOND ASSET MANAGEMENT SMALL CAP GROWTH RESOURCES OPPORTUNITIES U.S. GOVERNMENT INVESTMENT DIVISION INVESTMENT DIVISION INVESTMENT DIVISION INVESTMENT DIVISION -------------------- -------------------- -------------------- -------------------- ASSETS: Investments at fair value... $ 125,276,833 $ 170,365 $ 25,366,445 $ 16,494,250 Due from Metropolitan Life Insurance Company......... 16 -- -- -- -------------------- -------------------- -------------------- -------------------- Total Assets........... 125,276,849 170,365 25,366,445 16,494,250 -------------------- -------------------- -------------------- -------------------- LIABILITIES: Due to Metropolitan Life Insurance Company......... -- -- 3 1 -------------------- -------------------- -------------------- -------------------- Total Liabilities...... -- -- 3 1 -------------------- -------------------- -------------------- -------------------- NET ASSETS..................... $ 125,276,849 $ 170,365 $ 25,366,442 $ 16,494,249 ==================== ==================== ==================== ==================== PIMCO VIT PIMCO VIT COMMODITY REAL PIMCO VIT PIONEER VCT ALL ASSET RETURN STRATEGY LOW DURATION EMERGING MARKETS INVESTMENT DIVISION INVESTMENT DIVISION INVESTMENT DIVISION INVESTMENT DIVISION -------------------- ------------------- -------------------- -------------------- ASSETS: Investments at fair value... $ 924,295 $ 5,783 $ 1,571,604 $ 268,749 Due from Metropolitan Life Insurance Company......... -- -- -- -- -------------------- ------------------- -------------------- -------------------- Total Assets........... 924,295 5,783 1,571,604 268,749 -------------------- ------------------- -------------------- -------------------- LIABILITIES: Due to Metropolitan Life Insurance Company......... -- -- 1,308 -- -------------------- ------------------- -------------------- -------------------- Total Liabilities...... -- -- 1,308 -- -------------------- ------------------- -------------------- -------------------- NET ASSETS..................... $ 924,295 $ 5,783 $ 1,570,296 $ 268,749 ==================== =================== ==================== ==================== PIONEER VCT PUTNAM VT MID CAP VALUE INTERNATIONAL VALUE INVESTMENT DIVISION INVESTMENT DIVISION -------------------- ------------------- ASSETS: Investments at fair value... $ 49,935 $ 6,428 Due from Metropolitan Life Insurance Company......... -- -- -------------------- ------------------- Total Assets........... 49,935 6,428 -------------------- ------------------- LIABILITIES: Due to Metropolitan Life Insurance Company......... -- -- -------------------- ------------------- Total Liabilities...... -- -- -------------------- ------------------- NET ASSETS..................... $ 49,935 $ 6,428 ==================== ===================
The accompanying notes are an integral part of these financial statements. 22 The accompanying notes are an integral part of these financial statements. 23 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF ASSETS AND LIABILITIES -- (CONCLUDED) DECEMBER 31, 2013
UIF EMERGING UIF EMERGING ROYCE MICRO-CAP ROYCE SMALL-CAP MARKETS DEBT MARKETS EQUITY INVESTMENT DIVISION INVESTMENT DIVISION INVESTMENT DIVISION INVESTMENT DIVISION -------------------- -------------------- -------------------- -------------------- ASSETS: Investments at fair value... $ 7,757 $ 688,929 $ 1,160,019 $ 1,236,458 Due from Metropolitan Life Insurance Company......... -- -- -- -- -------------------- -------------------- -------------------- -------------------- Total Assets........... 7,757 688,929 1,160,019 1,236,458 -------------------- -------------------- -------------------- -------------------- LIABILITIES: Due to Metropolitan Life Insurance Company......... -- -- -- -- -------------------- -------------------- -------------------- -------------------- Total Liabilities...... -- -- -- -- -------------------- -------------------- -------------------- -------------------- NET ASSETS..................... $ 7,757 $ 688,929 $ 1,160,019 $ 1,236,458 ==================== ==================== ==================== ==================== WELLS FARGO VT TOTAL RETURN BOND INVESTMENT DIVISION -------------------- ASSETS: Investments at fair value... $ 257,976 Due from Metropolitan Life Insurance Company......... -- -------------------- Total Assets........... 257,976 -------------------- LIABILITIES: Due to Metropolitan Life Insurance Company......... 137 -------------------- Total Liabilities...... 137 -------------------- NET ASSETS..................... $ 257,839 ====================
The accompanying notes are an integral part of these financial statements. 24 The accompanying notes are an integral part of these financial statements. 25 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF OPERATIONS FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
ALLIANCEBERNSTEIN GLOBAL THEMATIC GROWTH INVESTMENT DIVISION --------------------------------------------------------------------- 2013 2012 2011 --------------------- --------------------- --------------------- INVESTMENT INCOME: Dividends.............................................. $ 13 $ -- $ 18,192 --------------------- --------------------- --------------------- EXPENSES: Mortality and expense risk charges..................... -- -- -- --------------------- --------------------- --------------------- Net investment income (loss)...................... 13 -- 18,192 --------------------- --------------------- --------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ -- -- -- Realized gains (losses) on sale of investments......... (1,496) (1,307,724) (40,514) --------------------- --------------------- --------------------- Net realized gains (losses)....................... (1,496) (1,307,724) (40,514) --------------------- --------------------- --------------------- Change in unrealized gains (losses) on investments..... 14,581 1,419,031 (1,444,286) --------------------- --------------------- --------------------- Net realized and changes in unrealized gains (losses) on investments...................................... 13,085 111,307 (1,484,800) --------------------- --------------------- --------------------- Net increase (decrease) in net assets resulting from operations..................................... $ 13,098 $ 111,307 $ (1,466,608) ===================== ===================== ===================== ALLIANCEBERNSTEIN INTERMEDIATE BOND INVESTMENT DIVISION --------------------------------------------------------------------- 2013 2012 2011 --------------------- --------------------- --------------------- INVESTMENT INCOME: Dividends.............................................. $ 1,888 $ 2,404 $ 2,097 --------------------- --------------------- --------------------- EXPENSES: Mortality and expense risk charges..................... -- -- -- --------------------- --------------------- --------------------- Net investment income (loss)...................... 1,888 2,404 2,097 --------------------- --------------------- --------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ 1,675 1,744 170 Realized gains (losses) on sale of investments......... (24) 43 14 --------------------- --------------------- --------------------- Net realized gains (losses)....................... 1,651 1,787 184 --------------------- --------------------- --------------------- Change in unrealized gains (losses) on investments..... (5,086) (188) 563 --------------------- --------------------- --------------------- Net realized and changes in unrealized gains (losses) on investments...................................... (3,435) 1,599 747 --------------------- --------------------- --------------------- Net increase (decrease) in net assets resulting from operations..................................... $ (1,547) $ 4,003 $ 2,844 ===================== ===================== ===================== AMERICAN CENTURY VP VISTA INVESTMENT DIVISION --------------------------------------------------------------------- 2013 2012 2011 --------------------- --------------------- --------------------- INVESTMENT INCOME: Dividends.............................................. $ -- $ -- $ -- --------------------- --------------------- --------------------- EXPENSES: Mortality and expense risk charges..................... -- -- -- --------------------- --------------------- --------------------- Net investment income (loss)...................... -- -- -- --------------------- --------------------- --------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ -- -- -- Realized gains (losses) on sale of investments......... 1,084 328 5,995 --------------------- --------------------- --------------------- Net realized gains (losses)....................... 1,084 328 5,995 --------------------- --------------------- --------------------- Change in unrealized gains (losses) on investments..... (55) 873 (8,184) --------------------- --------------------- --------------------- Net realized and changes in unrealized gains (losses) on investments...................................... 1,029 1,201 (2,189) --------------------- --------------------- --------------------- Net increase (decrease) in net assets resulting from operations..................................... $ 1,029 $ 1,201 $ (2,189) ===================== ===================== =====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 26 The accompanying notes are an integral part of these financial statements. 27 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
AMERICAN FUNDS BOND INVESTMENT DIVISION ------------------------------------------------------------------- 2013 2012 2011 -------------------- --------------------- -------------------- INVESTMENT INCOME: Dividends.............................................. $ 100,255 $ 133,110 $ 140,691 -------------------- --------------------- -------------------- EXPENSES: Mortality and expense risk charges..................... 8,663 9,169 8,171 -------------------- --------------------- -------------------- Net investment income (loss)...................... 91,592 123,941 132,520 -------------------- --------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ 61,561 -- -- Realized gains (losses) on sale of investments......... 741 27,506 10,695 -------------------- --------------------- -------------------- Net realized gains (losses)....................... 62,302 27,506 10,695 -------------------- --------------------- -------------------- Change in unrealized gains (losses) on investments..... (282,587) 108,693 121,054 -------------------- --------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments...................................... (220,285) 136,199 131,749 -------------------- --------------------- -------------------- Net increase (decrease) in net assets resulting from operations..................................... $ (128,693) $ 260,140 $ 264,269 ==================== ===================== ==================== AMERICAN FUNDS GLOBAL SMALL CAPITALIZATION INVESTMENT DIVISION ------------------------------------------------------------------- 2013 2012 2011 -------------------- --------------------- -------------------- INVESTMENT INCOME: Dividends.............................................. $ 571,973 $ 761,809 $ 817,781 -------------------- --------------------- -------------------- EXPENSES: Mortality and expense risk charges..................... 90,217 80,276 90,481 -------------------- --------------------- -------------------- Net investment income (loss)...................... 481,756 681,533 727,300 -------------------- --------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ -- -- -- Realized gains (losses) on sale of investments......... 556,105 (342,892) (68,423) -------------------- --------------------- -------------------- Net realized gains (losses)....................... 556,105 (342,892) (68,423) -------------------- --------------------- -------------------- Change in unrealized gains (losses) on investments..... 15,213,508 9,028,936 (13,188,181) -------------------- --------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments...................................... 15,769,613 8,686,044 (13,256,604) -------------------- --------------------- -------------------- Net increase (decrease) in net assets resulting from operations..................................... $ 16,251,369 $ 9,367,577 $ (12,529,304) ==================== ===================== ==================== AMERICAN FUNDS GROWTH INVESTMENT DIVISION -------------------------------------------------------------------- 2013 2012 2011 --------------------- -------------------- --------------------- INVESTMENT INCOME: Dividends.............................................. $ 1,364,727 $ 1,013,020 $ 771,098 --------------------- -------------------- --------------------- EXPENSES: Mortality and expense risk charges..................... 139,123 133,202 141,089 --------------------- -------------------- --------------------- Net investment income (loss)...................... 1,225,604 879,818 630,009 --------------------- -------------------- --------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ -- -- -- Realized gains (losses) on sale of investments......... 2,872,251 1,170,827 658,869 --------------------- -------------------- --------------------- Net realized gains (losses)....................... 2,872,251 1,170,827 658,869 --------------------- -------------------- --------------------- Change in unrealized gains (losses) on investments..... 34,086,809 18,556,699 (6,628,058) --------------------- -------------------- --------------------- Net realized and changes in unrealized gains (losses) on investments...................................... 36,959,060 19,727,526 (5,969,189) --------------------- -------------------- --------------------- Net increase (decrease) in net assets resulting from operations..................................... $ 38,184,664 $ 20,607,344 $ (5,339,180) ===================== ==================== =====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 28 The accompanying notes are an integral part of these financial statements. 29 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
AMERICAN FUNDS GROWTH-INCOME INVESTMENT DIVISION ------------------------------------------------------------------ 2013 2012 2011 -------------------- -------------------- -------------------- INVESTMENT INCOME: Dividends.............................................. $ 1,235,600 $ 1,253,842 $ 1,148,376 -------------------- -------------------- -------------------- EXPENSES: Mortality and expense risk charges..................... 89,908 78,704 77,416 -------------------- -------------------- -------------------- Net investment income (loss)...................... 1,145,692 1,175,138 1,070,960 -------------------- -------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ -- -- -- Realized gains (losses) on sale of investments......... 1,441,252 300,932 (58,726) -------------------- -------------------- -------------------- Net realized gains (losses)....................... 1,441,252 300,932 (58,726) -------------------- -------------------- -------------------- Change in unrealized gains (losses) on investments..... 23,374,516 10,629,027 (2,428,568) -------------------- -------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments....................................... 24,815,768 10,929,959 (2,487,294) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations...................................... $ 25,961,460 $ 12,105,097 $ (1,416,334) ==================== ==================== ==================== AMERICAN FUNDS HIGH-INCOME BOND INVESTMENT DIVISION ------------------------------------------- 2013 2012 (a) -------------------- -------------------- INVESTMENT INCOME: Dividends.............................................. $ 1,146 $ 3,203 -------------------- -------------------- EXPENSES: Mortality and expense risk charges..................... -- -- -------------------- -------------------- Net investment income (loss)...................... 1,146 3,203 -------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ -- -- Realized gains (losses) on sale of investments......... (51) 6 -------------------- -------------------- Net realized gains (losses)....................... (51) 6 -------------------- -------------------- Change in unrealized gains (losses) on investments..... 426 (677) -------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments....................................... 375 (671) -------------------- -------------------- Net increase (decrease) in net assets resulting from operations...................................... $ 1,521 $ 2,532 ==================== ==================== AMERICAN FUNDS INTERNATIONAL INVESTMENT DIVISION ------------------------------------------------------------------ 2013 2012 2011 -------------------- -------------------- -------------------- INVESTMENT INCOME: Dividends.............................................. $ 7,749 $ 7,535 $ 10,736 -------------------- -------------------- -------------------- EXPENSES: Mortality and expense risk charges..................... -- -- -- -------------------- -------------------- -------------------- Net investment income (loss)...................... 7,749 7,535 10,736 -------------------- -------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ -- -- -- Realized gains (losses) on sale of investments......... 27,615 (1,402) (605) -------------------- -------------------- -------------------- Net realized gains (losses)....................... 27,615 (1,402) (605) -------------------- -------------------- -------------------- Change in unrealized gains (losses) on investments..... 63,361 82,398 (108,507) -------------------- -------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments....................................... 90,976 80,996 (109,112) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations...................................... $ 98,725 $ 88,531 $ (98,376) ==================== ==================== ====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 30 The accompanying notes are an integral part of these financial statements. 31 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
AMERICAN FUNDS U.S. GOVERNMENT/AAA-RATED SECURITIES INVESTMENT DIVISION --------------------------------------------------------------------- 2013 2012 2011 --------------------- --------------------- --------------------- INVESTMENT INCOME: Dividends.............................................. $ 317 $ 440 $ 773 --------------------- --------------------- --------------------- EXPENSES: Mortality and expense risk charges..................... -- -- -- --------------------- --------------------- --------------------- Net investment income (loss)...................... 317 440 773 --------------------- --------------------- --------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ 1,258 1,252 1,111 Realized gains (losses) on sale of investments......... (28) 258 509 --------------------- --------------------- --------------------- Net realized gains (losses)....................... 1,230 1,510 1,620 --------------------- --------------------- --------------------- Change in unrealized gains (losses) on investments..... (2,996) (1,126) 885 --------------------- --------------------- --------------------- Net realized and changes in unrealized gains (losses) on investments...................................... (1,766) 384 2,505 --------------------- --------------------- --------------------- Net increase (decrease) in net assets resulting from operations..................................... $ (1,449) $ 824 $ 3,278 ===================== ===================== ===================== DREYFUS VIF INTERNATIONAL VALUE INVESTMENT DIVISION --------------------------------------------------------------------- 2013 2012 2011 --------------------- --------------------- --------------------- INVESTMENT INCOME: Dividends.............................................. $ 4,021 $ 4,882 $ 4,085 --------------------- --------------------- --------------------- EXPENSES: Mortality and expense risk charges..................... -- -- -- --------------------- --------------------- --------------------- Net investment income (loss)...................... 4,021 4,882 4,085 --------------------- --------------------- --------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ -- -- -- Realized gains (losses) on sale of investments......... (906) (1,011) (960) --------------------- --------------------- --------------------- Net realized gains (losses)....................... (906) (1,011) (960) --------------------- --------------------- --------------------- Change in unrealized gains (losses) on investments..... 42,909 18,857 (45,726) --------------------- --------------------- --------------------- Net realized and changes in unrealized gains (losses) on investments...................................... 42,003 17,846 (46,686) --------------------- --------------------- --------------------- Net increase (decrease) in net assets resulting from operations..................................... $ 46,024 $ 22,728 $ (42,601) ===================== ===================== ===================== FIDELITY VIP ASSET MANAGER: GROWTH INVESTMENT DIVISION --------------------------------------------------------------------- 2013 2012 2011 --------------------- --------------------- --------------------- INVESTMENT INCOME: Dividends.............................................. $ 16,073 $ 24,972 $ 23,605 --------------------- --------------------- --------------------- EXPENSES: Mortality and expense risk charges..................... -- -- -- --------------------- --------------------- --------------------- Net investment income (loss)...................... 16,073 24,972 23,605 --------------------- --------------------- --------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ 5,165 7,043 3,056 Realized gains (losses) on sale of investments......... 110,324 28,654 71,204 --------------------- --------------------- --------------------- Net realized gains (losses)....................... 115,489 35,697 74,260 --------------------- --------------------- --------------------- Change in unrealized gains (losses) on investments..... 260,059 172,026 (205,700) --------------------- --------------------- --------------------- Net realized and changes in unrealized gains (losses) on investments...................................... 375,548 207,723 (131,440) --------------------- --------------------- --------------------- Net increase (decrease) in net assets resulting from operations..................................... $ 391,621 $ 232,695 $ (107,835) ===================== ===================== =====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 32 The accompanying notes are an integral part of these financial statements. 33 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
FIDELITY VIP CONTRAFUND INVESTMENT DIVISION ---------------------------------------------------------------------- 2013 2012 2011 --------------------- --------------------- --------------------- INVESTMENT INCOME: Dividends............................................. $ 23,521 $ 28,837 $ 20,916 --------------------- --------------------- --------------------- EXPENSES: Mortality and expense risk charges.................... -- -- -- --------------------- --------------------- --------------------- Net investment income (loss)..................... 23,521 28,837 20,916 --------------------- --------------------- --------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions........................... 690 -- -- Realized gains (losses) on sale of investments........ 146,443 38,806 12,745 --------------------- --------------------- --------------------- Net realized gains (losses)...................... 147,133 38,806 12,745 --------------------- --------------------- --------------------- Change in unrealized gains (losses) on investments.... 505,651 288,092 (98,141) --------------------- --------------------- --------------------- Net realized and changes in unrealized gains (losses) on investments..................................... 652,784 326,898 (85,396) --------------------- --------------------- --------------------- Net increase (decrease) in net assets resulting from operations.................................... $ 676,305 $ 355,735 $ (64,480) ===================== ===================== ===================== FIDELITY VIP EQUITY-INCOME INVESTMENT DIVISION ---------------------------------------------------------------------- 2013 2012 2011 --------------------- --------------------- --------------------- INVESTMENT INCOME: Dividends............................................. $ 752 $ 1,836 $ 637 --------------------- --------------------- --------------------- EXPENSES: Mortality and expense risk charges.................... -- -- -- --------------------- --------------------- --------------------- Net investment income (loss)..................... 752 1,836 637 --------------------- --------------------- --------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions........................... 2,042 2,863 -- Realized gains (losses) on sale of investments........ 2,076 376 2,625 --------------------- --------------------- --------------------- Net realized gains (losses)...................... 4,118 3,239 2,625 --------------------- --------------------- --------------------- Change in unrealized gains (losses) on investments.... 3,227 (1,146) (8,921) --------------------- --------------------- --------------------- Net realized and changes in unrealized gains (losses) on investments..................................... 7,345 2,093 (6,296) --------------------- --------------------- --------------------- Net increase (decrease) in net assets resulting from operations.................................... $ 8,097 $ 3,929 $ (5,659) ===================== ===================== ===================== FIDELITY VIP FREEDOM 2010 INVESTMENT DIVISION ---------------------------------------------------------------------- 2013 2012 2011 --------------------- --------------------- --------------------- INVESTMENT INCOME: Dividends............................................. $ 755 $ 733 $ 726 --------------------- --------------------- --------------------- EXPENSES: Mortality and expense risk charges.................... 192 169 150 --------------------- --------------------- --------------------- Net investment income (loss)..................... 563 564 576 --------------------- --------------------- --------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions........................... 501 535 176 Realized gains (losses) on sale of investments........ 164 98 1,305 --------------------- --------------------- --------------------- Net realized gains (losses)...................... 665 633 1,481 --------------------- --------------------- --------------------- Change in unrealized gains (losses) on investments.... 3,994 2,707 (2,344) --------------------- --------------------- --------------------- Net realized and changes in unrealized gains (losses) on investments..................................... 4,659 3,340 (863) --------------------- --------------------- --------------------- Net increase (decrease) in net assets resulting from operations.................................... $ 5,222 $ 3,904 $ (287) ===================== ===================== =====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 34 The accompanying notes are an integral part of these financial statements. 35 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
FIDELITY VIP FREEDOM 2020 INVESTMENT DIVISION ------------------------------------------------------------ 2013 2012 2011 ------------------ ------------------ ------------------ INVESTMENT INCOME: Dividends........................................ $ 16,665 $ 15,185 $ 15,422 ------------------ ------------------ ------------------ EXPENSES: Mortality and expense risk charges............... 653 280 374 ------------------ ------------------ ------------------ Net investment income (loss)................ 16,012 14,905 15,048 ------------------ ------------------ ------------------ NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions...................... 11,508 8,838 2,671 Realized gains (losses) on sale of investments... 10,474 5,799 10,134 ------------------ ------------------ ------------------ Net realized gains (losses)................. 21,982 14,637 12,805 ------------------ ------------------ ------------------ Change in unrealized gains (losses) on investments................................... 93,753 62,352 (33,543) ------------------ ------------------ ------------------ Net realized and changes in unrealized gains (losses) on investments....................... 115,735 76,989 (20,738) ------------------ ------------------ ------------------ Net increase (decrease) in net assets resulting from operations............................... $ 131,747 $ 91,894 $ (5,690) ================== ================== ================== FIDELITY VIP FREEDOM 2025 INVESTMENT DIVISION -------------------- 2013 (b) -------------------- INVESTMENT INCOME: Dividends........................................ $ 694 -------------------- EXPENSES: Mortality and expense risk charges............... -- -------------------- Net investment income (loss)................ 694 -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions...................... 278 Realized gains (losses) on sale of investments... 135 -------------------- Net realized gains (losses)................. 413 -------------------- Change in unrealized gains (losses) on investments................................... 3,626 -------------------- Net realized and changes in unrealized gains (losses) on investments....................... 4,039 -------------------- Net increase (decrease) in net assets resulting from operations............................... $ 4,733 ==================== FIDELITY VIP FREEDOM 2030 INVESTMENT DIVISION ------------------------------------------------------------ 2013 2012 2011 ------------------ ------------------ ------------------ INVESTMENT INCOME: Dividends........................................ $ 993 $ 881 $ 1,232 ------------------ ------------------ ------------------ EXPENSES: Mortality and expense risk charges............... 230 216 214 ------------------ ------------------ ------------------ Net investment income (loss)................ 763 665 1,018 ------------------ ------------------ ------------------ NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions...................... 844 425 172 Realized gains (losses) on sale of investments... 2,703 2,855 11,751 ------------------ ------------------ ------------------ Net realized gains (losses)................. 3,547 3,280 11,923 ------------------ ------------------ ------------------ Change in unrealized gains (losses) on investments................................... 5,619 3,591 (12,843) ------------------ ------------------ ------------------ Net realized and changes in unrealized gains (losses) on investments....................... 9,166 6,871 (920) ------------------ ------------------ ------------------ Net increase (decrease) in net assets resulting from operations............................... $ 9,929 $ 7,536 $ 98 ================== ================== ================== FIDELITY VIP FREEDOM 2040 INVESTMENT DIVISION ------------------- 2013 (c) ------------------- INVESTMENT INCOME: Dividends........................................ $ 170 ------------------- EXPENSES: Mortality and expense risk charges............... 17 ------------------- Net investment income (loss)................ 153 ------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions...................... 76 Realized gains (losses) on sale of investments... 4 ------------------- Net realized gains (losses)................. 80 ------------------- Change in unrealized gains (losses) on investments................................... 545 ------------------- Net realized and changes in unrealized gains (losses) on investments....................... 625 ------------------- Net increase (decrease) in net assets resulting from operations............................... $ 778 =================== FIDELITY VIP FREEDOM 2050 INVESTMENT DIVISION ------------------------------------------------------------ 2013 2012 2011 (d) ------------------ ------------------ ------------------ INVESTMENT INCOME: Dividends........................................ $ 284 $ 360 $ 288 ------------------ ------------------ ------------------ EXPENSES: Mortality and expense risk charges............... 89 77 60 ------------------ ------------------ ------------------ Net investment income (loss)................ 195 283 (60) ------------------ ------------------ ------------------ NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions...................... 229 2,132 1,383 Realized gains (losses) on sale of investments... 94 28 (5,037) ------------------ ------------------ ------------------ Net realized gains (losses)................. 323 2,160 (3,654) ------------------ ------------------ ------------------ Change in unrealized gains (losses) on investments................................... 4,037 199 1,450 ------------------ ------------------ ------------------ Net realized and changes in unrealized gains (losses) on investments....................... 4,360 2,359 (2,204) ------------------ ------------------ ------------------ Net increase (decrease) in net assets resulting from operations............................... $ 4,555 $ 2,642 $ (1,976) ================== ================== ==================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 36 The accompanying notes are an integral part of these financial statements. 37 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
FIDELITY VIP HIGH INCOME INVESTMENT DIVISION ----------------------------------------------------------- 2013 2012 2011 ------------------ ------------------ ------------------ INVESTMENT INCOME: Dividends.............................................. $ 9,677 $ 9,229 $ 2,953 ------------------ ------------------ ------------------ EXPENSES: Mortality and expense risk charges..................... -- -- -- ------------------ ------------------ ------------------ Net investment income (loss)...................... 9,677 9,229 2,953 ------------------ ------------------ ------------------ NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ -- -- -- Realized gains (losses) on sale of investments......... 73 67 13 ------------------ ------------------ ------------------ Net realized gains (losses)....................... 73 67 13 ------------------ ------------------ ------------------ Change in unrealized gains (losses) on investments..... (126) (1,277) (1,768) ------------------ ------------------ ------------------ Net realized and changes in unrealized gains (losses) on investments...................................... (53) (1,210) (1,755) ------------------ ------------------ ------------------ Net increase (decrease) in net assets resulting from operations..................................... $ 9,624 $ 8,019 $ 1,198 ================== ================== ================== FIDELITY VIP INVESTMENT GRADE BOND INVESTMENT DIVISION ----------------------------------------------------------- 2013 2012 2011 ------------------ ------------------ ------------------ INVESTMENT INCOME: Dividends.............................................. $ 39,909 $ 37,562 $ 54,637 ------------------ ------------------ ------------------ EXPENSES: Mortality and expense risk charges..................... -- -- -- ------------------ ------------------ ------------------ Net investment income (loss)...................... 39,909 37,562 54,637 ------------------ ------------------ ------------------ NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ 21,294 48,616 24,253 Realized gains (losses) on sale of investments......... (28,717) 33,058 (3,064) ------------------ ------------------ ------------------ Net realized gains (losses)....................... (7,423) 81,674 21,189 ------------------ ------------------ ------------------ Change in unrealized gains (losses) on investments..... (76,349) (8,975) 1,742 ------------------ ------------------ ------------------ Net realized and changes in unrealized gains (losses) on investments...................................... (83,772) 72,699 22,931 ------------------ ------------------ ------------------ Net increase (decrease) in net assets resulting from operations..................................... $ (43,863) $ 110,261 $ 77,568 ================== ================== ================== FIDELITY VIP MID CAP INVESTMENT DIVISION ----------------------------------------------------------- 2013 2012 2011 ------------------ ------------------ ------------------ INVESTMENT INCOME: Dividends.............................................. $ 613 $ 2,865 $ 150 ------------------ ------------------ ------------------ EXPENSES: Mortality and expense risk charges..................... -- -- -- ------------------ ------------------ ------------------ Net investment income (loss)...................... 613 2,865 150 ------------------ ------------------ ------------------ NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ 35,674 59,448 1,181 Realized gains (losses) on sale of investments......... 172,540 8,193 10,846 ------------------ ------------------ ------------------ Net realized gains (losses)....................... 208,214 67,641 12,027 ------------------ ------------------ ------------------ Change in unrealized gains (losses) on investments..... 1,232 20,392 (60,535) ------------------ ------------------ ------------------ Net realized and changes in unrealized gains (losses) on investments...................................... 209,446 88,033 (48,508) ------------------ ------------------ ------------------ Net increase (decrease) in net assets resulting from operations..................................... $ 210,059 $ 90,898 $ (48,358) ================== ================== ================== FTVIPT FRANKLIN INCOME SECURITIES INVESTMENT DIVISION -------------------- 2013 (e) -------------------- INVESTMENT INCOME: Dividends.............................................. $ -- -------------------- EXPENSES: Mortality and expense risk charges..................... -- -------------------- Net investment income (loss)...................... -- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ -- Realized gains (losses) on sale of investments......... 3 -------------------- Net realized gains (losses)....................... 3 -------------------- Change in unrealized gains (losses) on investments..... 8 -------------------- Net realized and changes in unrealized gains (losses) on investments...................................... 11 -------------------- Net increase (decrease) in net assets resulting from operations..................................... $ 11 ====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 38 The accompanying notes are an integral part of these financial statements. 39 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
FTVIPT MUTUAL GLOBAL DISCOVERY SECURITIES INVESTMENT DIVISION --------------------------------------------------------------------- 2013 2012 2011 --------------------- --------------------- --------------------- INVESTMENT INCOME: Dividends............................ $ 19,686 $ 21,682 $ 22,691 --------------------- --------------------- --------------------- EXPENSES: Mortality and expense risk charges... -- -- -- --------------------- --------------------- --------------------- Net investment income (loss).... 19,686 21,682 22,691 --------------------- --------------------- --------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions.......... 81,814 43,771 22,139 Realized gains (losses) on sale of investments....................... 59,341 5,837 (20,210) --------------------- --------------------- --------------------- Net realized gains (losses)..... 141,155 49,608 1,929 --------------------- --------------------- --------------------- Change in unrealized gains (losses) on investments.................... 47,244 33,439 (59,670) --------------------- --------------------- --------------------- Net realized and changes in unrealized gains (losses) on investments....................... 188,399 83,047 (57,741) --------------------- --------------------- --------------------- Net increase (decrease) in net assets resulting from operations.. $ 208,085 $ 104,729 $ (35,050) ===================== ===================== ===================== FTVIPT MUTUAL SHARES SECURITIES INVESTMENT DIVISION -------------------- 2013 (e) -------------------- INVESTMENT INCOME: Dividends............................ $ 445 -------------------- EXPENSES: Mortality and expense risk charges... -- -------------------- Net investment income (loss).... 445 -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions.......... -- Realized gains (losses) on sale of investments....................... 105 -------------------- Net realized gains (losses)..... 105 -------------------- Change in unrealized gains (losses) on investments.................... 2,000 -------------------- Net realized and changes in unrealized gains (losses) on investments....................... 2,105 -------------------- Net increase (decrease) in net assets resulting from operations.. $ 2,550 ==================== FTVIPT TEMPLETON FOREIGN SECURITIES INVESTMENT DIVISION --------------------------------------------------------------------- 2013 2012 2011 --------------------- --------------------- --------------------- INVESTMENT INCOME: Dividends............................ $ 98,174 $ 115,174 $ 89,150 --------------------- --------------------- --------------------- EXPENSES: Mortality and expense risk charges... -- -- -- --------------------- --------------------- --------------------- Net investment income (loss).... 98,174 115,174 89,150 --------------------- --------------------- --------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions.......... -- -- -- Realized gains (losses) on sale of investments....................... 73,110 (16,852) 253,750 --------------------- --------------------- --------------------- Net realized gains (losses)..... 73,110 (16,852) 253,750 --------------------- --------------------- --------------------- Change in unrealized gains (losses) on investments.................... 689,874 501,451 (552,735) --------------------- --------------------- --------------------- Net realized and changes in unrealized gains (losses) on investments....................... 762,984 484,599 (298,985) --------------------- --------------------- --------------------- Net increase (decrease) in net assets resulting from operations.. $ 861,158 $ 599,773 $ (209,835) ===================== ===================== ===================== FTVIPT TEMPLETON GLOBAL BOND SECURITIES INVESTMENT DIVISION -------------------------------------------------------------------- 2013 2012 2011 --------------------- -------------------- -------------------- INVESTMENT INCOME: Dividends............................ $ 20,975 $ 24,244 $ 10,824 --------------------- -------------------- -------------------- EXPENSES: Mortality and expense risk charges... -- -- -- --------------------- -------------------- -------------------- Net investment income (loss).... 20,975 24,244 10,824 --------------------- -------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions.......... 5,202 590 1,216 Realized gains (losses) on sale of investments....................... 1,245 (238) (12,515) --------------------- -------------------- -------------------- Net realized gains (losses)..... 6,447 352 (11,299) --------------------- -------------------- -------------------- Change in unrealized gains (losses) on investments.................... (6,052) 26,566 (11,949) --------------------- -------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments....................... 395 26,918 (23,248) --------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations.. $ 21,370 $ 51,162 $ (12,424) ===================== ==================== ====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 40 The accompanying notes are an integral part of these financial statements. 41 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
GOLDMAN SACHS MID-CAP VALUE INVESTMENT DIVISION -------------------------------------------------------------------- 2013 2012 2011 -------------------- --------------------- --------------------- INVESTMENT INCOME: Dividends.............................................. $ 2,312 $ 2,932 $ 2,221 -------------------- --------------------- --------------------- EXPENSES: Mortality and expense risk charges..................... -- -- -- -------------------- --------------------- --------------------- Net investment income (loss)...................... 2,312 2,932 2,221 -------------------- --------------------- --------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ 22,308 -- -- Realized gains (losses) on sale of investments......... 9,943 (683) (27,627) -------------------- --------------------- --------------------- Net realized gains (losses)....................... 32,251 (683) (27,627) -------------------- --------------------- --------------------- Change in unrealized gains (losses) on investments..... 43,303 45,178 1,030 -------------------- --------------------- --------------------- Net realized and changes in unrealized gains (losses) on investments...................................... 75,554 44,495 (26,597) -------------------- --------------------- --------------------- Net increase (decrease) in net assets resulting from operations..................................... $ 77,866 $ 47,427 $ (24,376) ==================== ===================== ===================== GOLDMAN SACHS STRUCTURED SMALL CAP EQUITY INVESTMENT DIVISION -------------------------------------------------------------------- 2013 2012 2011 --------------------- --------------------- -------------------- INVESTMENT INCOME: Dividends.............................................. $ 373 $ 308 $ 424 --------------------- --------------------- -------------------- EXPENSES: Mortality and expense risk charges..................... -- -- -- --------------------- --------------------- -------------------- Net investment income (loss)...................... 373 308 424 --------------------- --------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ 4,708 -- -- Realized gains (losses) on sale of investments......... 1,040 5,427 175 --------------------- --------------------- -------------------- Net realized gains (losses)....................... 5,748 5,427 175 --------------------- --------------------- -------------------- Change in unrealized gains (losses) on investments..... 3,869 (629) (255) --------------------- --------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments...................................... 9,617 4,798 (80) --------------------- --------------------- -------------------- Net increase (decrease) in net assets resulting from operations..................................... $ 9,990 $ 5,106 $ 344 ===================== ===================== ==================== INVESCO V.I. COMSTOCK INVESTMENT DIVISION -------------------------------------------------------------------- 2013 2012 2011 -------------------- --------------------- --------------------- INVESTMENT INCOME: Dividends.............................................. $ 4,077 $ 3,483 $ 489 -------------------- --------------------- --------------------- EXPENSES: Mortality and expense risk charges..................... -- -- -- -------------------- --------------------- --------------------- Net investment income (loss)...................... 4,077 3,483 489 -------------------- --------------------- --------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ -- -- -- Realized gains (losses) on sale of investments......... 1,475 1,338 (127) -------------------- --------------------- --------------------- Net realized gains (losses)....................... 1,475 1,338 (127) -------------------- --------------------- --------------------- Change in unrealized gains (losses) on investments..... 78,224 32,459 (6,181) -------------------- --------------------- --------------------- Net realized and changes in unrealized gains (losses) on investments...................................... 79,699 33,797 (6,308) -------------------- --------------------- --------------------- Net increase (decrease) in net assets resulting from operations..................................... $ 83,776 $ 37,280 $ (5,819) ==================== ===================== =====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 42 The accompanying notes are an integral part of these financial statements. 43 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
INVESCO V.I. GLOBAL REAL ESTATE INVESTMENT DIVISION ------------------------------------------------------------------------ 2013 2012 2011 ---------------------- ---------------------- ---------------------- INVESTMENT INCOME: Dividends.......................................... $ 99,799 $ 10,832 $ 72,431 ---------------------- ---------------------- ---------------------- EXPENSES: Mortality and expense risk charges................. -- -- -- ---------------------- ---------------------- ---------------------- Net investment income (loss).................. 99,799 10,832 72,431 ---------------------- ---------------------- ---------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions........................ -- -- -- Realized gains (losses) on sale of investments..... 38,480 (24,321) (158,339) ---------------------- ---------------------- ---------------------- Net realized gains (losses)................... 38,480 (24,321) (158,339) ---------------------- ---------------------- ---------------------- Change in unrealized gains (losses) on investments. (72,537) 481,388 (44,519) ---------------------- ---------------------- ---------------------- Net realized and changes in unrealized gains (losses) on investments.......................... (34,057) 457,067 (202,858) ---------------------- ---------------------- ---------------------- Net increase (decrease) in net assets resulting from operations.................................. $ 65,742 $ 467,899 $ (130,427) ====================== ====================== ====================== INVESCO V.I. GOVERNMENT SECURITIES INVESTMENT DIVISION ------------------------------------------------------------------------ 2013 2012 2011 (f) --------------------- ---------------------- ---------------------- INVESTMENT INCOME: Dividends.......................................... $ 367 $ -- --------------------- ---------------------- ---------------------- EXPENSES: Mortality and expense risk charges................. -- -- -- --------------------- ---------------------- ---------------------- Net investment income (loss).................. 367 -- -- --------------------- ---------------------- ---------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions........................ -- -- -- Realized gains (losses) on sale of investments..... (1) 1,308 1,389 --------------------- ---------------------- ---------------------- Net realized gains (losses)................... (1) 1,308 1,389 --------------------- ---------------------- ---------------------- Change in unrealized gains (losses) on investments. (529) (1,335) 1,336 --------------------- ---------------------- ---------------------- Net realized and changes in unrealized gains (losses) on investments.......................... (530) (27) 2,725 --------------------- ---------------------- ---------------------- Net increase (decrease) in net assets resulting from operations.................................. $ (163) $ (27) $ 2,725 ===================== ====================== ====================== INVESCO V.I. INTERNATIONAL GROWTH INVESTMENT DIVISION ------------------------------------------------------------------------ 2013 2012 2011 ---------------------- ---------------------- ---------------------- INVESTMENT INCOME: Dividends.......................................... $ 4,576 $ 90,329 $ 3,660 ---------------------- ---------------------- ---------------------- EXPENSES: Mortality and expense risk charges................. -- -- -- ---------------------- ---------------------- ---------------------- Net investment income (loss).................. 4,576 90,329 3,660 ---------------------- ---------------------- ---------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions........................ -- -- -- Realized gains (losses) on sale of investments..... 926,281 18,589 3,888 ---------------------- ---------------------- ---------------------- Net realized gains (losses)................... 926,281 18,589 3,888 ---------------------- ---------------------- ---------------------- Change in unrealized gains (losses) on investments. (647,277) 685,032 (28,330) ---------------------- ---------------------- ---------------------- Net realized and changes in unrealized gains (losses) on investments.......................... 279,004 703,621 (24,442) ---------------------- ---------------------- ---------------------- Net increase (decrease) in net assets resulting from operations.................................. $ 283,580 $ 793,950 $ (20,782) ====================== ====================== ======================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 44 The accompanying notes are an integral part of these financial statements. 45 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
JANUS ASPEN BALANCED INVESTMENT DIVISION -------------------------------------------------------------------- 2013 2012 2011 --------------------- -------------------- -------------------- INVESTMENT INCOME: Dividends.............................................. $ 13,254 $ 27,163 $ 44,376 --------------------- -------------------- -------------------- EXPENSES: Mortality and expense risk charges..................... -- -- -- --------------------- -------------------- -------------------- Net investment income (loss)...................... 13,254 27,163 44,376 --------------------- -------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ 54,904 74,896 108,835 Realized gains (losses) on sale of investments......... 25,371 40,351 29,077 --------------------- -------------------- -------------------- Net realized gains (losses)....................... 80,275 115,247 137,912 --------------------- -------------------- -------------------- Change in unrealized gains (losses) on investments..... 94,265 25,664 (161,867) --------------------- -------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments...................................... 174,540 140,911 (23,955) --------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations..................................... $ 187,794 $ 168,074 $ 20,421 ===================== ==================== ==================== JANUS ASPEN FORTY INVESTMENT DIVISION -------------------------------------------------------------------- 2013 2012 2011 --------------------- -------------------- -------------------- INVESTMENT INCOME: Dividends.............................................. $ 4,954 $ 5,152 $ 2,325 --------------------- -------------------- -------------------- EXPENSES: Mortality and expense risk charges..................... -- -- -- --------------------- -------------------- -------------------- Net investment income (loss)...................... 4,954 5,152 2,325 --------------------- -------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ -- -- -- Realized gains (losses) on sale of investments......... 69,285 38,660 43,353 --------------------- -------------------- -------------------- Net realized gains (losses)....................... 69,285 38,660 43,353 --------------------- -------------------- -------------------- Change in unrealized gains (losses) on investments..... 155,845 126,343 (117,114) --------------------- -------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments...................................... 225,130 165,003 (73,761) --------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations..................................... $ 230,084 $ 170,155 $ (71,436) ===================== ==================== ==================== JANUS ASPEN JANUS INVESTMENT DIVISION -------------------------------------------------------------------- 2013 2012 2011 -------------------- --------------------- --------------------- INVESTMENT INCOME: Dividends.............................................. $ 6,858 $ 5,213 $ 5,397 -------------------- --------------------- --------------------- EXPENSES: Mortality and expense risk charges..................... -- -- -- -------------------- --------------------- --------------------- Net investment income (loss)...................... 6,858 5,213 5,397 -------------------- --------------------- --------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ -- 15,799 -- Realized gains (losses) on sale of investments......... 258,951 13,270 1,561,413 -------------------- --------------------- --------------------- Net realized gains (losses)....................... 258,951 29,069 1,561,413 -------------------- --------------------- --------------------- Change in unrealized gains (losses) on investments..... (62,054) 122,884 (1,416,036) -------------------- --------------------- --------------------- Net realized and changes in unrealized gains (losses) on investments...................................... 196,897 151,953 145,377 -------------------- --------------------- --------------------- Net increase (decrease) in net assets resulting from operations..................................... $ 203,755 $ 157,166 $ 150,774 ==================== ===================== =====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 46 The accompanying notes are an integral part of these financial statements. 47 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
JANUS ASPEN OVERSEAS INVESTMENT DIVISION ------------------------------------------------------------------ 2013 2012 2011 -------------------- -------------------- -------------------- INVESTMENT INCOME: Dividends.............................................. $ 11,835 $ 2,519 $ 1,291 -------------------- -------------------- -------------------- EXPENSES: Mortality and expense risk charges..................... -- -- -- -------------------- -------------------- -------------------- Net investment income (loss)...................... 11,835 2,519 1,291 -------------------- -------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ -- 43,521 3,396 Realized gains (losses) on sale of investments......... (73,759) (7,156) (93,767) -------------------- -------------------- -------------------- Net realized gains (losses)....................... (73,759) 36,365 (90,371) -------------------- -------------------- -------------------- Change in unrealized gains (losses) on investments..... 113,083 8,927 (214,175) -------------------- -------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments...................................... 39,324 45,292 (304,546) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations..................................... $ 51,159 $ 47,811 $ (303,255) ==================== ==================== ==================== MFS VIT GLOBAL EQUITY INVESTMENT DIVISION ------------------------------------------------------------------- 2013 2012 2011 --------------------- -------------------- -------------------- INVESTMENT INCOME: Dividends.............................................. $ 1,253 $ 61 $ 575 --------------------- -------------------- -------------------- EXPENSES: Mortality and expense risk charges..................... -- -- -- --------------------- -------------------- -------------------- Net investment income (loss)...................... 1,253 61 575 --------------------- -------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ -- 154 -- Realized gains (losses) on sale of investments......... 550 274 12,787 --------------------- -------------------- -------------------- Net realized gains (losses)....................... 550 428 12,787 --------------------- -------------------- -------------------- Change in unrealized gains (losses) on investments..... 37,978 6,795 (16,173) --------------------- -------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments...................................... 38,528 7,223 (3,386) --------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations..................................... $ 39,781 $ 7,284 $ (2,811) ===================== ==================== ==================== MFS VIT NEW DISCOVERY INVESTMENT DIVISION ------------------------------------------------------------------- 2013 2012 2011 --------------------- -------------------- -------------------- INVESTMENT INCOME: Dividends.............................................. $ -- $ -- $ -- --------------------- -------------------- -------------------- EXPENSES: Mortality and expense risk charges..................... -- -- -- --------------------- -------------------- -------------------- Net investment income (loss)...................... -- -- -- --------------------- -------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ 1,718 15,912 17,326 Realized gains (losses) on sale of investments......... 1,963 264 772 --------------------- -------------------- -------------------- Net realized gains (losses)....................... 3,681 16,176 18,098 --------------------- -------------------- -------------------- Change in unrealized gains (losses) on investments..... 65,025 11,186 (32,906) --------------------- -------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments...................................... 68,706 27,362 (14,808) --------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations..................................... $ 68,706 $ 27,362 $ (14,808) ===================== ==================== ====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 48 The accompanying notes are an integral part of these financial statements. 49 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
MFS VIT VALUE INVESTMENT DIVISION ------------------------------------------------------------------- 2013 2012 2011 -------------------- --------------------- -------------------- INVESTMENT INCOME: Dividends.............................................. $ 197 $ 668 $ 999 -------------------- --------------------- -------------------- EXPENSES: Mortality and expense risk charges..................... -- -- -- -------------------- --------------------- -------------------- Net investment income (loss)...................... 197 668 999 -------------------- --------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ 61 355 318 Realized gains (losses) on sale of investments......... 323 3,188 (10,004) -------------------- --------------------- -------------------- Net realized gains (losses)....................... 384 3,543 (9,686) -------------------- --------------------- -------------------- Change in unrealized gains (losses) on investments..... 5,315 2,241 6,173 -------------------- --------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments...................................... 5,699 5,784 (3,513) -------------------- --------------------- -------------------- Net increase (decrease) in net assets resulting from operations..................................... $ 5,896 $ 6,452 $ (2,514) ==================== ===================== ==================== MFS VIT II MIST ALLIANCEBERNSTEIN HIGH YIELD GLOBAL DYNAMIC ALLOCATION INVESTMENT DIVISION INVESTMENT DIVISION -------------------- -------------------------------------------- 2013 (g) 2013 2012 (h) -------------------- -------------------- -------------------- INVESTMENT INCOME: Dividends.............................................. $ 3,270 $ 139 $ -- -------------------- -------------------- -------------------- EXPENSES: Mortality and expense risk charges..................... -- -- -- -------------------- -------------------- -------------------- Net investment income (loss)...................... 3,270 139 -- -------------------- -------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ -- 231 -- Realized gains (losses) on sale of investments......... (3) 67 -- -------------------- -------------------- -------------------- Net realized gains (losses)....................... (3) 298 -- -------------------- -------------------- -------------------- Change in unrealized gains (losses) on investments..... 2,275 1,389 163 -------------------- -------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments...................................... 2,272 1,687 163 -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations..................................... $ 5,542 $ 1,826 $ 163 ==================== ==================== ==================== MIST AMERICAN FUNDS BALANCED ALLOCATION INVESTMENT DIVISION -------------------------------------------------------------------- 2013 2012 2011 --------------------- -------------------- --------------------- INVESTMENT INCOME: Dividends.............................................. $ 11,592 $ 10,680 $ 6,635 --------------------- -------------------- --------------------- EXPENSES: Mortality and expense risk charges..................... -- -- -- --------------------- -------------------- --------------------- Net investment income (loss)...................... 11,592 10,680 6,635 --------------------- -------------------- --------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ 42,196 5,437 248 Realized gains (losses) on sale of investments......... 5,669 3,875 6,046 --------------------- -------------------- --------------------- Net realized gains (losses)....................... 47,865 9,312 6,294 --------------------- -------------------- --------------------- Change in unrealized gains (losses) on investments..... 62,896 50,640 (23,258) --------------------- -------------------- --------------------- Net realized and changes in unrealized gains (losses) on investments...................................... 110,761 59,952 (16,964) --------------------- -------------------- --------------------- Net increase (decrease) in net assets resulting from operations..................................... $ 122,353 $ 70,632 $ (10,329) ===================== ==================== =====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 50 The accompanying notes are an integral part of these financial statements. 51 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
MIST AMERICAN FUNDS GROWTH ALLOCATION INVESTMENT DIVISION --------------------------------------------------------- 2013 2012 2011 ----------------- ----------------- ----------------- INVESTMENT INCOME: Dividends.............................................. $ 16,414 $ 13,384 $ 10,815 ----------------- ----------------- ----------------- EXPENSES: Mortality and expense risk charges..................... -- -- -- ----------------- ----------------- ----------------- Net investment income (loss)...................... 16,414 13,384 10,815 ----------------- ----------------- ----------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ 69,006 -- -- Realized gains (losses) on sale of investments......... 36,038 16,384 9,254 ----------------- ----------------- ----------------- Net realized gains (losses)....................... 105,044 16,384 9,254 ----------------- ----------------- ----------------- Change in unrealized gains (losses) on investments..... 172,370 96,877 (58,738) ----------------- ----------------- ----------------- Net realized and changes in unrealized gains (losses) on investments...................................... 277,414 113,261 (49,484) ----------------- ----------------- ----------------- Net increase (decrease) in net assets resulting from operations..................................... $ 293,828 $ 126,645 $ (38,669) ================= ================= ================= MIST AMERICAN FUNDS MODERATE ALLOCATION INVESTMENT DIVISION --------------------------------------------------------- 2013 2012 2011 ------------------ ------------------ ----------------- INVESTMENT INCOME: Dividends.............................................. $ 14,487 $ 10,434 $ 5,453 ------------------ ------------------ ----------------- EXPENSES: Mortality and expense risk charges..................... -- -- -- ------------------ ------------------ ----------------- Net investment income (loss)...................... 14,487 10,434 5,453 ------------------ ------------------ ----------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ 39,313 5,798 1,467 Realized gains (losses) on sale of investments......... 5,863 5,301 1,917 ------------------ ------------------ ----------------- Net realized gains (losses)....................... 45,176 11,099 3,384 ------------------ ------------------ ----------------- Change in unrealized gains (losses) on investments..... 36,688 29,635 (7,233) ------------------ ------------------ ----------------- Net realized and changes in unrealized gains (losses) on investments...................................... 81,864 40,734 (3,849) ------------------ ------------------ ----------------- Net increase (decrease) in net assets resulting from operations..................................... $ 96,351 $ 51,168 $ 1,604 ================== ================== ================= MIST AQR GLOBAL RISK BALANCED INVESTMENT DIVISION ------------------------------------- 2013 2012 (h) ----------------- ----------------- INVESTMENT INCOME: Dividends.............................................. $ 1,949 $ -- ----------------- ----------------- EXPENSES: Mortality and expense risk charges..................... -- -- ----------------- ----------------- Net investment income (loss)...................... 1,949 -- ----------------- ----------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ 3,632 -- Realized gains (losses) on sale of investments......... 169 (28) ----------------- ----------------- Net realized gains (losses)....................... 3,801 (28) ----------------- ----------------- Change in unrealized gains (losses) on investments..... (10,413) 375 ----------------- ----------------- Net realized and changes in unrealized gains (losses) on investments...................................... (6,612) 347 ----------------- ----------------- Net increase (decrease) in net assets resulting from operations..................................... $ (4,663) $ 347 ================= ================= MIST BLACKROCK GLOBAL TACTICAL STRATEGIES INVESTMENT DIVISION -------------------------------------- 2013 2012 (h) ------------------ ------------------ INVESTMENT INCOME: Dividends.............................................. $ 951 $ -- ------------------ ------------------ EXPENSES: Mortality and expense risk charges..................... -- -- ------------------ ------------------ Net investment income (loss)...................... 951 -- ------------------ ------------------ NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ 1,537 -- Realized gains (losses) on sale of investments......... 238 51 ------------------ ------------------ Net realized gains (losses)....................... 1,775 51 ------------------ ------------------ Change in unrealized gains (losses) on investments..... 4,911 878 ------------------ ------------------ Net realized and changes in unrealized gains (losses) on investments...................................... 6,686 929 ------------------ ------------------ Net increase (decrease) in net assets resulting from operations..................................... $ 7,637 $ 929 ================== ==================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 52 The accompanying notes are an integral part of these financial statements. 53 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
MIST BLACKROCK LARGE CAP CORE INVESTMENT DIVISION ------------------------------------------------------------------- 2013 2012 2011 -------------------- -------------------- -------------------- INVESTMENT INCOME: Dividends.............................................. $ 4,873,934 $ 3,715,688 $ 3,462,386 -------------------- -------------------- -------------------- EXPENSES: Mortality and expense risk charges..................... 1,786,264 1,609,817 1,619,434 -------------------- -------------------- -------------------- Net investment income (loss)...................... 3,087,670 2,105,871 1,842,952 -------------------- -------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ -- -- -- Realized gains (losses) on sale of investments......... 1,187,504 (3,353,915) (4,542,808) -------------------- -------------------- -------------------- Net realized gains (losses)....................... 1,187,504 (3,353,915) (4,542,808) -------------------- -------------------- -------------------- Change in unrealized gains (losses) on investments..... 96,008,684 38,395,441 3,050,880 -------------------- -------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments...................................... 97,196,188 35,041,526 (1,491,928) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations..................................... $ 100,283,858 $ 37,147,397 $ 351,024 ==================== ==================== ==================== MIST CLARION GLOBAL REAL ESTATE INVESTMENT DIVISION ------------------------------------------------------------------- 2013 2012 2011 -------------------- -------------------- -------------------- INVESTMENT INCOME: Dividends.............................................. $ 1,883,980 $ 496,469 $ 847,944 -------------------- -------------------- -------------------- EXPENSES: Mortality and expense risk charges..................... 31,537 26,819 25,697 -------------------- -------------------- -------------------- Net investment income (loss)...................... 1,852,443 469,650 822,247 -------------------- -------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ -- -- -- Realized gains (losses) on sale of investments......... (121,862) (282,095) (421,589) -------------------- -------------------- -------------------- Net realized gains (losses)....................... (121,862) (282,095) (421,589) -------------------- -------------------- -------------------- Change in unrealized gains (losses) on investments..... (768,686) 4,988,577 (1,500,208) -------------------- -------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments...................................... (890,548) 4,706,482 (1,921,797) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations..................................... $ 961,895 $ 5,176,132 $ (1,099,550) ==================== ==================== ==================== MIST CLEARBRIDGE AGGRESSIVE GROWTH II INVESTMENT DIVISION ------------------------------------------------------------------- 2013 2012 2011 -------------------- --------------------- -------------------- INVESTMENT INCOME: Dividends.............................................. $ 131,330 $ 62,437 $ 249,768 -------------------- --------------------- -------------------- EXPENSES: Mortality and expense risk charges..................... 21,101 18,962 18,401 -------------------- --------------------- -------------------- Net investment income (loss)...................... 110,229 43,475 231,367 -------------------- --------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ -- -- -- Realized gains (losses) on sale of investments......... 518,428 176,627 2,199 -------------------- --------------------- -------------------- Net realized gains (losses)....................... 518,428 176,627 2,199 -------------------- --------------------- -------------------- Change in unrealized gains (losses) on investments..... 3,724,517 2,618,525 (1,278,619) -------------------- --------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments...................................... 4,242,945 2,795,152 (1,276,420) -------------------- --------------------- -------------------- Net increase (decrease) in net assets resulting from operations..................................... $ 4,353,174 $ 2,838,627 $ (1,045,053) ==================== ===================== ====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 54 The accompanying notes are an integral part of these financial statements. 55 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
MIST CLEARBRIDGE AGGRESSIVE GROWTH INVESTMENT DIVISION ------------------------------------------------------------------- 2013 2012 2011 -------------------- -------------------- -------------------- INVESTMENT INCOME: Dividends.............................................. $ 71,803 $ 28,628 $ 8,681 -------------------- -------------------- -------------------- EXPENSES: Mortality and expense risk charges..................... 12,286 8,213 6,297 -------------------- -------------------- -------------------- Net investment income (loss)...................... 59,517 20,415 2,384 -------------------- -------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ -- -- -- Realized gains (losses) on sale of investments......... 455,065 171,678 93,448 -------------------- -------------------- -------------------- Net realized gains (losses)....................... 455,065 171,678 93,448 -------------------- -------------------- -------------------- Change in unrealized gains (losses) on investments..... 6,062,472 2,107,124 (217,464) -------------------- -------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments...................................... 6,517,537 2,278,802 (124,016) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations..................................... $ 6,577,054 $ 2,299,217 $ (121,632) ==================== ==================== ==================== MIST HARRIS OAKMARK INTERNATIONAL INVESTMENT DIVISION -------------------------------------------------------------------- 2013 2012 2011 -------------------- -------------------- --------------------- INVESTMENT INCOME: Dividends.............................................. $ 1,234,640 $ 542,318 $ 8,423 -------------------- -------------------- --------------------- EXPENSES: Mortality and expense risk charges..................... 58,015 44,596 46,783 -------------------- -------------------- --------------------- Net investment income (loss)...................... 1,176,625 497,722 (38,360) -------------------- -------------------- --------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ -- -- -- Realized gains (losses) on sale of investments......... 663,573 (140,345) (114,036) -------------------- -------------------- --------------------- Net realized gains (losses)....................... 663,573 (140,345) (114,036) -------------------- -------------------- --------------------- Change in unrealized gains (losses) on investments..... 9,999,502 7,474,599 (4,256,535) -------------------- -------------------- --------------------- Net realized and changes in unrealized gains (losses) on investments...................................... 10,663,075 7,334,254 (4,370,571) -------------------- -------------------- --------------------- Net increase (decrease) in net assets resulting from operations..................................... $ 11,839,700 $ 7,831,976 $ (4,408,931) ==================== ==================== ===================== MIST INVESCO BALANCED-RISK ALLOCATION INVESTMENT DIVISION -------------------------------------------- 2013 2012 (h) -------------------- --------------------- INVESTMENT INCOME: Dividends.............................................. $ -- $ 23 -------------------- --------------------- EXPENSES: Mortality and expense risk charges..................... -- -- -------------------- --------------------- Net investment income (loss)...................... -- 23 -------------------- --------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ 159 83 Realized gains (losses) on sale of investments......... (33) -- -------------------- --------------------- Net realized gains (losses)....................... 126 83 -------------------- --------------------- Change in unrealized gains (losses) on investments..... 124 (2) -------------------- --------------------- Net realized and changes in unrealized gains (losses) on investments...................................... 250 81 -------------------- --------------------- Net increase (decrease) in net assets resulting from operations..................................... $ 250 $ 104 ==================== =====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 56 The accompanying notes are an integral part of these financial statements. 57 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
MIST INVESCO MID CAP VALUE INVESTMENT DIVISION ------------------------------------------------------------------ 2013 2012 2011 -------------------- -------------------- -------------------- INVESTMENT INCOME: Dividends.............................................. $ 762,499 $ 457 $ 603 -------------------- -------------------- -------------------- EXPENSES: Mortality and expense risk charges..................... 83,667 49,296 -- -------------------- -------------------- -------------------- Net investment income (loss)...................... 678,832 (48,839) 603 -------------------- -------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ -- -- -- Realized gains (losses) on sale of investments......... 935,109 (82,924) 818 -------------------- -------------------- -------------------- Net realized gains (losses)....................... 935,109 (82,924) 818 -------------------- -------------------- -------------------- Change in unrealized gains (losses) on investments..... 20,593,687 2,481,449 (5,510) -------------------- -------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments...................................... 21,528,796 2,398,525 (4,692) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations..................................... $ 22,207,628 $ 2,349,686 $ (4,089) ==================== ==================== ==================== MIST INVESCO SMALL CAP GROWTH INVESTMENT DIVISION ------------------------------------------------------------------- 2013 2012 2011 -------------------- -------------------- -------------------- INVESTMENT INCOME: Dividends.............................................. $ 23,000 $ -- $ -- -------------------- -------------------- -------------------- EXPENSES: Mortality and expense risk charges..................... 7,768 5,823 5,378 -------------------- -------------------- -------------------- Net investment income (loss)...................... 15,232 (5,823) (5,378) -------------------- -------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ 326,110 273,441 -- Realized gains (losses) on sale of investments......... 243,128 154,730 169,309 -------------------- -------------------- -------------------- Net realized gains (losses)....................... 569,238 428,171 169,309 -------------------- -------------------- -------------------- Change in unrealized gains (losses) on investments..... 1,365,097 331,488 (192,641) -------------------- -------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments...................................... 1,934,335 759,659 (23,332) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations..................................... $ 1,949,567 $ 753,836 $ (28,710) ==================== ==================== ==================== MIST JPMORGAN GLOBAL ACTIVE ALLOCATION INVESTMENT DIVISION -------------------------------------------- 2013 2012 (h) -------------------- -------------------- INVESTMENT INCOME: Dividends.............................................. $ 54 $ 68 -------------------- -------------------- EXPENSES: Mortality and expense risk charges..................... -- -- -------------------- -------------------- Net investment income (loss)...................... 54 68 -------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ 321 117 Realized gains (losses) on sale of investments......... (595) (10) -------------------- -------------------- Net realized gains (losses)....................... (274) 107 -------------------- -------------------- Change in unrealized gains (losses) on investments..... 5,829 152 -------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments...................................... 5,555 259 -------------------- -------------------- Net increase (decrease) in net assets resulting from operations..................................... $ 5,609 $ 327 ==================== ====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 58 The accompanying notes are an integral part of these financial statements. 59 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
MIST JPMORGAN SMALL CAP VALUE INVESTMENT DIVISION ----------------------------------------------------------------- 2013 2012 2011 ------------------- ------------------- ------------------- INVESTMENT INCOME: Dividends.............................................. $ 337 $ 358 $ 472 ------------------- ------------------- ------------------- EXPENSES: Mortality and expense risk charges..................... -- -- -- ------------------- ------------------- ------------------- Net investment income (loss)...................... 337 358 472 ------------------- ------------------- ------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ -- -- -- Realized gains (losses) on sale of investments......... 2,408 3,130 1,124 ------------------- ------------------- ------------------- Net realized gains (losses)....................... 2,408 3,130 1,124 ------------------- ------------------- ------------------- Change in unrealized gains (losses) on investments..... 28,817 1,696 (4,058) ------------------- ------------------- ------------------- Net realized and changes in unrealized gains (losses) on investments....................................... 31,225 4,826 (2,934) ------------------- ------------------- ------------------- Net increase (decrease) in net assets resulting from operations...................................... $ 31,562 $ 5,184 $ (2,462) =================== =================== =================== MIST LOOMIS SAYLES GLOBAL MARKETS INVESTMENT DIVISION -------------------- 2013 (e) -------------------- INVESTMENT INCOME: Dividends.............................................. $ -- -------------------- EXPENSES: Mortality and expense risk charges..................... -- -------------------- Net investment income (loss)...................... -- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ -- Realized gains (losses) on sale of investments......... 705 -------------------- Net realized gains (losses)....................... 705 -------------------- Change in unrealized gains (losses) on investments..... 43,104 -------------------- Net realized and changes in unrealized gains (losses) on investments....................................... 43,809 -------------------- Net increase (decrease) in net assets resulting from operations...................................... $ 43,809 ==================== MIST LORD ABBETT BOND DEBENTURE INVESTMENT DIVISION ----------------------------------------------------------------- 2013 2012 2011 ------------------- ------------------- ------------------- INVESTMENT INCOME: Dividends.............................................. $ 1,965,620 $ 1,984,542 $ 1,568,618 ------------------- ------------------- ------------------- EXPENSES: Mortality and expense risk charges..................... 63,217 61,482 59,503 ------------------- ------------------- ------------------- Net investment income (loss)...................... 1,902,403 1,923,060 1,509,115 ------------------- ------------------- ------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ -- -- -- Realized gains (losses) on sale of investments......... 299,375 218,347 583,376 ------------------- ------------------- ------------------- Net realized gains (losses)....................... 299,375 218,347 583,376 ------------------- ------------------- ------------------- Change in unrealized gains (losses) on investments..... (7,269) 1,167,280 (863,576) ------------------- ------------------- ------------------- Net realized and changes in unrealized gains (losses) on investments....................................... 292,106 1,385,627 (280,200) ------------------- ------------------- ------------------- Net increase (decrease) in net assets resulting from operations...................................... $ 2,194,509 $ 3,308,687 $ 1,228,915 =================== =================== =================== MIST MET/TEMPLETON INTERNATIONAL BOND INVESTMENT DIVISION ------------------------------------------- 2013 2012 (h) -------------------- -------------------- INVESTMENT INCOME: Dividends.............................................. $ 302 $ -- -------------------- -------------------- EXPENSES: Mortality and expense risk charges..................... -- -- -------------------- -------------------- Net investment income (loss)...................... 302 -- -------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ 61 -- Realized gains (losses) on sale of investments......... (24) 21 -------------------- -------------------- Net realized gains (losses)....................... 37 21 -------------------- -------------------- Change in unrealized gains (losses) on investments..... 996 47 -------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments....................................... 1,033 68 -------------------- -------------------- Net increase (decrease) in net assets resulting from operations...................................... $ 1,335 $ 68 ==================== ====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 60 The accompanying notes are an integral part of these financial statements. 61 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
MIST METLIFE AGGRESSIVE STRATEGY INVESTMENT DIVISION ------------------------------------------------------------ 2013 2012 2011 (f) ------------------ ------------------ ------------------ INVESTMENT INCOME: Dividends.............................................. $ 158,967 $ 118,210 -- ------------------ ------------------ ------------------ EXPENSES: Mortality and expense risk charges..................... 14,210 12,011 8,047 ------------------ ------------------ ------------------ Net investment income (loss)...................... 144,757 106,199 (8,047) ------------------ ------------------ ------------------ NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ -- -- -- Realized gains (losses) on sale of investments......... 243,289 (55,023) (117,896) ------------------ ------------------ ------------------ Net realized gains (losses)....................... 243,289 (55,023) (117,896) ------------------ ------------------ ------------------ Change in unrealized gains (losses) on investments..... 4,045,633 2,084,613 (1,834,063) ------------------ ------------------ ------------------ Net realized and changes in unrealized gains (losses) on investments...................................... 4,288,922 2,029,590 (1,951,959) ------------------ ------------------ ------------------ Net increase (decrease) in net assets resulting from operations..................................... $ 4,433,679 $ 2,135,789 $ (1,960,006) ================== ================== ================== MIST METLIFE MIST METLIFE BALANCED PLUS GROWTH STRATEGY INVESTMENT DIVISION INVESTMENT DIVISION --------------------------------------- ------------------- 2013 2012 (h) 2013 (e) ------------------- ------------------ ------------------- INVESTMENT INCOME: Dividends.............................................. $ 778 $ -- $ -- ------------------- ------------------ ------------------- EXPENSES: Mortality and expense risk charges..................... -- -- -- ------------------- ------------------ ------------------- Net investment income (loss)...................... 778 -- -- ------------------- ------------------ ------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ 1,257 -- -- Realized gains (losses) on sale of investments......... 2,685 119 2,973 ------------------- ------------------ ------------------- Net realized gains (losses)....................... 3,942 119 2,973 ------------------- ------------------ ------------------- Change in unrealized gains (losses) on investments..... 4,689 1,691 51,429 ------------------- ------------------ ------------------- Net realized and changes in unrealized gains (losses) on investments...................................... 8,631 1,810 54,402 ------------------- ------------------ ------------------- Net increase (decrease) in net assets resulting from operations..................................... $ 9,409 $ 1,810 $ 54,402 =================== ================== =================== MIST METLIFE MULTI-INDEX TARGETED RISK INVESTMENT DIVISION ------------------- 2013 (e) ------------------- INVESTMENT INCOME: Dividends.............................................. $ 6 ------------------- EXPENSES: Mortality and expense risk charges..................... -- ------------------- Net investment income (loss)...................... 6 ------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ 47 Realized gains (losses) on sale of investments......... (241) ------------------- Net realized gains (losses)....................... (194) ------------------- Change in unrealized gains (losses) on investments..... 52 ------------------- Net realized and changes in unrealized gains (losses) on investments...................................... (142) ------------------- Net increase (decrease) in net assets resulting from operations..................................... $ (136) =================== MIST MFS EMERGING MARKETS EQUITY INVESTMENT DIVISION ------------------------------------------------------------ 2013 2012 2011 (f) ------------------ ------------------- ------------------- INVESTMENT INCOME: Dividends.............................................. $ 1,482 $ 1,167 $ -- ------------------ ------------------- ------------------- EXPENSES: Mortality and expense risk charges..................... -- -- -- ------------------ ------------------- ------------------- Net investment income (loss)...................... 1,482 1,167 -- ------------------ ------------------- ------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ -- -- -- Realized gains (losses) on sale of investments......... 254 (1,470) (70) ------------------ ------------------- ------------------- Net realized gains (losses)....................... 254 (1,470) (70) ------------------ ------------------- ------------------- Change in unrealized gains (losses) on investments..... (3,821) 9,361 (3,209) ------------------ ------------------- ------------------- Net realized and changes in unrealized gains (losses) on investments...................................... (3,567) 7,891 (3,279) ------------------ ------------------- ------------------- Net increase (decrease) in net assets resulting from operations..................................... $ (2,085) $ 9,058 $ (3,279) ================== =================== ===================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 62 The accompanying notes are an integral part of these financial statements. 63 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
MIST MFS RESEARCH INTERNATIONAL INVESTMENT DIVISION ----------------------------------------------------------------- 2013 2012 2011 -------------------- -------------------- ------------------- INVESTMENT INCOME: Dividends.............................................. $ 475,117 $ 282,245 $ 285,362 -------------------- -------------------- ------------------- EXPENSES: Mortality and expense risk charges..................... 17,938 16,065 17,373 -------------------- -------------------- ------------------- Net investment income (loss)...................... 457,179 266,180 267,989 -------------------- -------------------- ------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ -- -- -- Realized gains (losses) on sale of investments......... 48,641 (345,224) (233,782) -------------------- -------------------- ------------------- Net realized gains (losses)....................... 48,641 (345,224) (233,782) -------------------- -------------------- ------------------- Change in unrealized gains (losses) on investments..... 2,877,942 2,185,121 (1,480,693) -------------------- -------------------- ------------------- Net realized and changes in unrealized gains (losses) on investments....................................... 2,926,583 1,839,897 (1,714,475) -------------------- -------------------- ------------------- Net increase (decrease) in net assets resulting from operations...................................... $ 3,383,762 $ 2,106,077 $ (1,446,486) ==================== ==================== =================== MIST MORGAN STANLEY MID CAP GROWTH INVESTMENT DIVISION ------------------------------------------------------------------ 2013 2012 2011 -------------------- -------------------- -------------------- INVESTMENT INCOME: Dividends.............................................. $ 1,687,241 $ -- $ 1,490,199 -------------------- -------------------- -------------------- EXPENSES: Mortality and expense risk charges..................... 654,660 579,825 623,473 -------------------- -------------------- -------------------- Net investment income (loss)...................... 1,032,581 (579,825) 866,726 -------------------- -------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ -- -- 5,251,936 Realized gains (losses) on sale of investments......... 3,781,941 1,677,793 2,604,216 -------------------- -------------------- -------------------- Net realized gains (losses)....................... 3,781,941 1,677,793 7,856,152 -------------------- -------------------- -------------------- Change in unrealized gains (losses) on investments..... 65,460,998 15,368,250 (21,552,444) -------------------- -------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments....................................... 69,242,939 17,046,043 (13,696,292) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations...................................... $ 70,275,520 $ 16,466,218 $ (12,829,566) ==================== ==================== ==================== MIST OPPENHEIMER GLOBAL EQUITY INVESTMENT DIVISION ----------------------------------------------------------------- 2013 2012 2011 ------------------- ------------------- -------------------- INVESTMENT INCOME: Dividends.............................................. $ 945,127 $ 648,196 $ 845,569 ------------------- ------------------- -------------------- EXPENSES: Mortality and expense risk charges..................... 97,189 117,470 126,057 ------------------- ------------------- -------------------- Net investment income (loss)...................... 847,938 530,726 719,512 ------------------- ------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ -- -- -- Realized gains (losses) on sale of investments......... 1,128,194 700,180 892,248 ------------------- ------------------- -------------------- Net realized gains (losses)....................... 1,128,194 700,180 892,248 ------------------- ------------------- -------------------- Change in unrealized gains (losses) on investments..... 9,078,535 6,406,670 (5,213,727) ------------------- ------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments....................................... 10,206,729 7,106,850 (4,321,479) ------------------- ------------------- -------------------- Net increase (decrease) in net assets resulting from operations...................................... $ 11,054,667 $ 7,637,576 $ (3,601,967) =================== =================== ====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 64 The accompanying notes are an integral part of these financial statements. 65 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
MIST PIMCO INFLATION PROTECTED BOND INVESTMENT DIVISION ----------------------------------------------------------------- 2013 2012 2011 -------------------- -------------------- ------------------- INVESTMENT INCOME: Dividends.............................................. $ 302,323 $ 395,503 $ 165,169 -------------------- -------------------- ------------------- EXPENSES: Mortality and expense risk charges..................... 25,479 26,003 18,173 -------------------- -------------------- ------------------- Net investment income (loss)...................... 276,844 369,500 146,996 -------------------- -------------------- ------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ 719,437 725,803 424,271 Realized gains (losses) on sale of investments......... (174,195) 75,075 100,776 -------------------- -------------------- ------------------- Net realized gains (losses)....................... 545,242 800,878 525,047 -------------------- -------------------- ------------------- Change in unrealized gains (losses) on investments..... (2,018,492) (101,684) 331,187 -------------------- -------------------- ------------------- Net realized and changes in unrealized gains (losses) on investments....................................... (1,473,250) 699,194 856,234 -------------------- -------------------- ------------------- Net increase (decrease) in net assets resulting from operations...................................... $ (1,196,406) $ 1,068,694 $ 1,003,230 ==================== ==================== =================== MIST PIMCO TOTAL RETURN INVESTMENT DIVISION ----------------------------------------------------------------- 2013 2012 2011 -------------------- -------------------- ------------------- INVESTMENT INCOME: Dividends.............................................. $ 2,175,351 $ 1,636,863 $ 1,344,247 -------------------- -------------------- ------------------- EXPENSES: Mortality and expense risk charges..................... 65,679 66,690 62,517 -------------------- -------------------- ------------------- Net investment income (loss)...................... 2,109,672 1,570,173 1,281,730 -------------------- -------------------- ------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ 954,935 -- 1,446,133 Realized gains (losses) on sale of investments......... 128,011 347,234 187,988 -------------------- -------------------- ------------------- Net realized gains (losses)....................... 1,082,946 347,234 1,634,121 -------------------- -------------------- ------------------- Change in unrealized gains (losses) on investments..... (4,155,495) 2,519,869 (1,410,547) -------------------- -------------------- ------------------- Net realized and changes in unrealized gains (losses) on investments....................................... (3,072,549) 2,867,103 223,574 -------------------- -------------------- ------------------- Net increase (decrease) in net assets resulting from operations...................................... $ (962,877) $ 4,437,276 $ 1,505,304 ==================== ==================== =================== MIST PIONEER FUND INVESTMENT DIVISION ----------------------------------------------------------------- 2013 2012 2011 ------------------- -------------------- -------------------- INVESTMENT INCOME: Dividends.............................................. $ 6,252 $ 2,902 $ 2,289 ------------------- -------------------- -------------------- EXPENSES: Mortality and expense risk charges..................... -- -- -- ------------------- -------------------- -------------------- Net investment income (loss)...................... 6,252 2,902 2,289 ------------------- -------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ -- -- -- Realized gains (losses) on sale of investments......... 17,551 1,266 21,102 ------------------- -------------------- -------------------- Net realized gains (losses)....................... 17,551 1,266 21,102 ------------------- -------------------- -------------------- Change in unrealized gains (losses) on investments..... 32,389 14,560 (30,602) ------------------- -------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments....................................... 49,940 15,826 (9,500) ------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations...................................... $ 56,192 $ 18,728 $ (7,211) =================== ==================== ====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 66 The accompanying notes are an integral part of these financial statements. 67 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
MIST PYRAMIS MANAGED RISK MIST SCHRODERS GLOBAL MULTI-ASSET INVESTMENT DIVISION INVESTMENT DIVISION -------------------- ------------------------------------------- 2013 (e) 2013 2012 (h) -------------------- -------------------- -------------------- INVESTMENT INCOME: Dividends.............................................. $ 2 $ 1 $ 42 -------------------- -------------------- -------------------- EXPENSES: Mortality and expense risk charges..................... -- -- -- -------------------- -------------------- -------------------- Net investment income (loss)...................... 2 1 42 -------------------- -------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ 5 37 94 Realized gains (losses) on sale of investments......... -- 150 9 -------------------- -------------------- -------------------- Net realized gains (losses)....................... 5 187 103 -------------------- -------------------- -------------------- Change in unrealized gains (losses) on investments..... 6 1,498 (23) -------------------- -------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments....................................... 11 1,685 80 -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations...................................... $ 13 $ 1,686 $ 122 ==================== ==================== ==================== MIST SSGA GROWTH AND INCOME ETF INVESTMENT DIVISION ------------------------------------------------------------------ 2013 2012 2011 -------------------- -------------------- -------------------- INVESTMENT INCOME: Dividends.............................................. $ 186,845 $ 133,958 $ 74,234 -------------------- -------------------- -------------------- EXPENSES: Mortality and expense risk charges..................... 9,307 7,748 6,908 -------------------- -------------------- -------------------- Net investment income (loss)...................... 177,538 126,210 67,326 -------------------- -------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ 160,153 114,627 74,142 Realized gains (losses) on sale of investments......... 90,613 53,987 49,491 -------------------- -------------------- -------------------- Net realized gains (losses)....................... 250,766 168,614 123,633 -------------------- -------------------- -------------------- Change in unrealized gains (losses) on investments..... 431,610 365,606 (151,325) -------------------- -------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments....................................... 682,376 534,220 (27,692) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations...................................... $ 859,914 $ 660,430 $ 39,634 ==================== ==================== ==================== MIST SSGA GROWTH ETF INVESTMENT DIVISION ------------------------------------------------------------------ 2013 2012 2011 -------------------- -------------------- -------------------- INVESTMENT INCOME: Dividends.............................................. $ 110,154 $ 80,502 $ 57,479 -------------------- -------------------- -------------------- EXPENSES: Mortality and expense risk charges..................... 7,236 5,984 5,126 -------------------- -------------------- -------------------- Net investment income (loss)...................... 102,918 74,518 52,353 -------------------- -------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ 172,116 134,987 -- Realized gains (losses) on sale of investments......... 83,650 42,712 63,035 -------------------- -------------------- -------------------- Net realized gains (losses)....................... 255,766 177,699 63,035 -------------------- -------------------- -------------------- Change in unrealized gains (losses) on investments..... 467,150 279,360 (183,850) -------------------- -------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments....................................... 722,916 457,059 (120,815) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations...................................... $ 825,834 $ 531,577 $ (68,462) ==================== ==================== ====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 68 The accompanying notes are an integral part of these financial statements. 69 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
MIST T. ROWE PRICE LARGE CAP VALUE INVESTMENT DIVISION ------------------------------------------------------------------ 2013 2012 2011 -------------------- -------------------- -------------------- INVESTMENT INCOME: Dividends.............................................. $ 30,041 $ 19,582 $ 9,481 -------------------- -------------------- -------------------- EXPENSES: Mortality and expense risk charges..................... -- -- -- -------------------- -------------------- -------------------- Net investment income (loss)...................... 30,041 19,582 9,481 -------------------- -------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ -- -- -- Realized gains (losses) on sale of investments......... 22,312 (1,403) (435,260) -------------------- -------------------- -------------------- Net realized gains (losses)....................... 22,312 (1,403) (435,260) -------------------- -------------------- -------------------- Change in unrealized gains (losses) on investments..... 456,298 181,043 577,510 -------------------- -------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments...................................... 478,610 179,640 142,250 -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations..................................... $ 508,651 $ 199,222 $ 151,731 ==================== ==================== ==================== MIST T. ROWE PRICE MID CAP GROWTH INVESTMENT DIVISION ------------------------------------------------------------------- 2013 2012 2011 -------------------- -------------------- -------------------- INVESTMENT INCOME: Dividends.............................................. $ 98,665 $ -- -- -------------------- -------------------- -------------------- EXPENSES: Mortality and expense risk charges..................... 33,261 29,751 30,563 -------------------- -------------------- -------------------- Net investment income (loss)...................... 65,404 (29,751) (30,563) -------------------- -------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ 1,223,909 2,679,802 560,152 Realized gains (losses) on sale of investments......... 608,004 (50,793) 312,619 -------------------- -------------------- -------------------- Net realized gains (losses)....................... 1,831,913 2,629,009 872,771 -------------------- -------------------- -------------------- Change in unrealized gains (losses) on investments..... 5,764,932 206,878 (1,837,318) -------------------- -------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments...................................... 7,596,845 2,835,887 (964,547) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations..................................... $ 7,662,249 $ 2,806,136 $ (995,110) ==================== ==================== ==================== MIST THIRD AVENUE SMALL CAP VALUE INVESTMENT DIVISION ------------------------------------------------------------------- 2013 2012 2011 -------------------- -------------------- -------------------- INVESTMENT INCOME: Dividends.............................................. $ 9,744 $ -- $ 9,414 -------------------- -------------------- -------------------- EXPENSES: Mortality and expense risk charges..................... -- -- -- -------------------- -------------------- -------------------- Net investment income (loss)...................... 9,744 -- 9,414 -------------------- -------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ -- -- -- Realized gains (losses) on sale of investments......... 47,240 12,071 86,881 -------------------- -------------------- -------------------- Net realized gains (losses)....................... 47,240 12,071 86,881 -------------------- -------------------- -------------------- Change in unrealized gains (losses) on investments..... 199,123 129,525 (240,493) -------------------- -------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments...................................... 246,363 141,596 (153,612) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations..................................... $ 256,107 $ 141,596 $ (144,198) ==================== ==================== ====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 70 The accompanying notes are an integral part of these financial statements. 71 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
MSF BAILLIE GIFFORD INTERNATIONAL STOCK INVESTMENT DIVISION -------------------------------------------------------------------- 2013 2012 2011 --------------------- -------------------- --------------------- INVESTMENT INCOME: Dividends.............................................. $ 674,943 $ 525,164 $ 753,948 --------------------- -------------------- --------------------- EXPENSES: Mortality and expense risk charges..................... 198,504 183,754 207,499 --------------------- -------------------- --------------------- Net investment income (loss)...................... 476,439 341,410 546,449 --------------------- -------------------- --------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ -- -- -- Realized gains (losses) on sale of investments......... (474,270) (1,190,404) (808,593) --------------------- -------------------- --------------------- Net realized gains (losses)....................... (474,270) (1,190,404) (808,593) --------------------- -------------------- --------------------- Change in unrealized gains (losses) on investments..... 5,921,616 7,502,480 (8,900,342) --------------------- -------------------- --------------------- Net realized and changes in unrealized gains (losses) on investments...................................... 5,447,346 6,312,076 (9,708,935) --------------------- -------------------- --------------------- Net increase (decrease) in net assets resulting from operations..................................... $ 5,923,785 $ 6,653,486 $ (9,162,486) ===================== ==================== ===================== MSF BARCLAYS AGGREGATE BOND INDEX INVESTMENT DIVISION ------------------------------------------------------------------- 2013 2012 2011 -------------------- --------------------- -------------------- INVESTMENT INCOME: Dividends.............................................. $ 4,111,311 $ 4,275,027 $ 3,919,750 -------------------- --------------------- -------------------- EXPENSES: Mortality and expense risk charges..................... 40,998 43,939 43,935 -------------------- --------------------- -------------------- Net investment income (loss)...................... 4,070,313 4,231,088 3,875,815 -------------------- --------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ -- -- -- Realized gains (losses) on sale of investments......... 125,172 604,720 843,640 -------------------- --------------------- -------------------- Net realized gains (losses)....................... 125,172 604,720 843,640 -------------------- --------------------- -------------------- Change in unrealized gains (losses) on investments..... (6,977,167) (447,969) 3,276,276 -------------------- --------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments...................................... (6,851,995) 156,751 4,119,916 -------------------- --------------------- -------------------- Net increase (decrease) in net assets resulting from operations..................................... $ (2,781,682) $ 4,387,839 $ 7,995,731 ==================== ===================== ==================== MSF BLACKROCK BOND INCOME INVESTMENT DIVISION -------------------------------------------------------------------- 2013 2012 2011 --------------------- -------------------- -------------------- INVESTMENT INCOME: Dividends.............................................. $ 3,290,462 $ 2,288,505 $ 3,304,583 --------------------- -------------------- -------------------- EXPENSES: Mortality and expense risk charges..................... 301,259 317,038 318,184 --------------------- -------------------- -------------------- Net investment income (loss)...................... 2,989,203 1,971,467 2,986,399 --------------------- -------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ 2,005,629 551,492 -- Realized gains (losses) on sale of investments......... 142,786 354,078 132,024 --------------------- -------------------- -------------------- Net realized gains (losses)....................... 2,148,415 905,570 132,024 --------------------- -------------------- -------------------- Change in unrealized gains (losses) on investments..... (6,076,619) 2,995,775 1,930,533 --------------------- -------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments...................................... (3,928,204) 3,901,345 2,062,557 --------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations..................................... $ (939,001) $ 5,872,812 $ 5,048,956 ===================== ==================== ====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 72 The accompanying notes are an integral part of these financial statements. 73 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
MSF BLACKROCK CAPITAL APPRECIATION INVESTMENT DIVISION ------------------------------------------------------------------- 2013 2012 2011 -------------------- -------------------- -------------------- INVESTMENT INCOME: Dividends.............................................. $ 144,698 $ 41,947 $ 14,560 -------------------- -------------------- -------------------- EXPENSES: Mortality and expense risk charges..................... 8,874 8,390 7,908 -------------------- -------------------- -------------------- Net investment income (loss)...................... 135,824 33,557 6,652 -------------------- -------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ -- -- -- Realized gains (losses) on sale of investments......... 321,200 261,278 137,813 -------------------- -------------------- -------------------- Net realized gains (losses)....................... 321,200 261,278 137,813 -------------------- -------------------- -------------------- Change in unrealized gains (losses) on investments..... 4,769,715 1,344,869 (879,158) -------------------- -------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments...................................... 5,090,915 1,606,147 (741,345) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations..................................... $ 5,226,739 $ 1,639,704 $ (734,693) ==================== ==================== ==================== MSF BLACKROCK DIVERSIFIED INVESTMENT DIVISION ------------------------------------------------------------------ 2013 2012 2011 -------------------- -------------------- -------------------- INVESTMENT INCOME: Dividends.............................................. $ 6,982,518 $ 6,071,412 $ 6,407,012 -------------------- -------------------- -------------------- EXPENSES: Mortality and expense risk charges..................... 1,536,230 1,471,028 1,472,691 -------------------- -------------------- -------------------- Net investment income (loss)...................... 5,446,288 4,600,384 4,934,321 -------------------- -------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ -- -- -- Realized gains (losses) on sale of investments......... 2,747,913 1,094,116 (191,522) -------------------- -------------------- -------------------- Net realized gains (losses)....................... 2,747,913 1,094,116 (191,522) -------------------- -------------------- -------------------- Change in unrealized gains (losses) on investments..... 43,444,585 23,691,349 3,658,514 -------------------- -------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments...................................... 46,192,498 24,785,465 3,466,992 -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations..................................... $ 51,638,786 $ 29,385,849 $ 8,401,313 ==================== ==================== ==================== MSF BLACKROCK LARGE CAP VALUE INVESTMENT DIVISION ------------------------------------------------------------------ 2013 2012 2011 -------------------- -------------------- -------------------- INVESTMENT INCOME: Dividends.............................................. $ 225,484 $ 229,106 $ 149,056 -------------------- -------------------- -------------------- EXPENSES: Mortality and expense risk charges..................... 19,704 19,727 19,323 -------------------- -------------------- -------------------- Net investment income (loss)...................... 205,780 209,379 129,733 -------------------- -------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ 871,774 2,231,565 -- Realized gains (losses) on sale of investments......... 44,941 (224,253) (80,782) -------------------- -------------------- -------------------- Net realized gains (losses)....................... 916,715 2,007,312 (80,782) -------------------- -------------------- -------------------- Change in unrealized gains (losses) on investments..... 3,399,848 (358,711) 254,349 -------------------- -------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments...................................... 4,316,563 1,648,601 173,567 -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations..................................... $ 4,522,343 $ 1,857,980 $ 303,300 ==================== ==================== ====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 74 The accompanying notes are an integral part of these financial statements. 75 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
MSF BLACKROCK MONEY MARKET INVESTMENT DIVISION ------------------------------------------------------------------ 2013 2012 2011 -------------------- -------------------- -------------------- INVESTMENT INCOME: Dividends.............................................. $ -- $ -- $ -- -------------------- -------------------- -------------------- EXPENSES: Mortality and expense risk charges..................... 45,649 48,731 47,046 -------------------- -------------------- -------------------- Net investment income (loss)...................... (45,649) (48,731) (47,046) -------------------- -------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ -- -- -- Realized gains (losses) on sale of investments......... -- -- -- -------------------- -------------------- -------------------- Net realized gains (losses)....................... -- -- -- -------------------- -------------------- -------------------- Change in unrealized gains (losses) on investments..... -- -- -- -------------------- -------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments....................................... -- -- -- -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations...................................... $ (45,649) $ (48,731) $ (47,046) ==================== ==================== ==================== MSF DAVIS VENTURE VALUE INVESTMENT DIVISION ----------------------------------------------------------------- 2013 2012 2011 ------------------- ------------------- -------------------- INVESTMENT INCOME: Dividends.............................................. $ 908,277 $ 475,355 $ 648,127 ------------------- ------------------- -------------------- EXPENSES: Mortality and expense risk charges..................... 53,237 49,148 53,389 ------------------- ------------------- -------------------- Net investment income (loss)...................... 855,040 426,207 594,738 ------------------- ------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ 1,084,791 -- -- Realized gains (losses) on sale of investments......... 1,697,357 549,533 492,146 ------------------- ------------------- -------------------- Net realized gains (losses)....................... 2,782,148 549,533 492,146 ------------------- ------------------- -------------------- Change in unrealized gains (losses) on investments..... 15,346,828 5,763,493 (3,392,027) ------------------- ------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments....................................... 18,128,976 6,313,026 (2,899,881) ------------------- ------------------- -------------------- Net increase (decrease) in net assets resulting from operations...................................... $ 18,984,016 $ 6,739,233 $ (2,305,143) =================== =================== ==================== MSF FRONTIER MID CAP GROWTH INVESTMENT DIVISION ------------------------------------------------------------------ 2013 2012 2011 -------------------- -------------------- -------------------- INVESTMENT INCOME: Dividends.............................................. $ 2,591,979 $ -- $ 597,164 -------------------- -------------------- -------------------- EXPENSES: Mortality and expense risk charges..................... 1,371,993 1,258,555 1,298,633 -------------------- -------------------- -------------------- Net investment income (loss)...................... 1,219,986 (1,258,555) (701,469) -------------------- -------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ 4,884,883 -- -- Realized gains (losses) on sale of investments......... 5,761,928 2,892,428 2,544,325 -------------------- -------------------- -------------------- Net realized gains (losses)....................... 10,646,811 2,892,428 2,544,325 -------------------- -------------------- -------------------- Change in unrealized gains (losses) on investments..... 45,562,137 17,096,166 (8,863,059) -------------------- -------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments....................................... 56,208,948 19,988,594 (6,318,734) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations...................................... $ 57,428,934 $ 18,730,039 $ (7,020,203) ==================== ==================== ====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 76 The accompanying notes are an integral part of these financial statements. 77 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
MSF JENNISON GROWTH INVESTMENT DIVISION ------------------------------------------------------------------- 2013 2012 2011 -------------------- -------------------- -------------------- INVESTMENT INCOME: Dividends.............................................. $ 81,129 $ 37,925 $ 42,021 -------------------- -------------------- -------------------- EXPENSES: Mortality and expense risk charges..................... 11,843 9,820 6,458 -------------------- -------------------- -------------------- Net investment income (loss)...................... 69,286 28,105 35,563 -------------------- -------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ 199,135 2,671,966 -- Realized gains (losses) on sale of investments......... 549,515 139,207 251,119 -------------------- -------------------- -------------------- Net realized gains (losses)....................... 748,650 2,811,173 251,119 -------------------- -------------------- -------------------- Change in unrealized gains (losses) on investments..... 5,442,828 (683,735) (215,551) -------------------- -------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments...................................... 6,191,478 2,127,438 35,568 -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations..................................... $ 6,260,764 $ 2,155,543 $ 71,131 ==================== ==================== ==================== MSF LOOMIS SAYLES SMALL CAP CORE INVESTMENT DIVISION ------------------------------------------------------------------- 2013 2012 2011 -------------------- -------------------- --------------------- INVESTMENT INCOME: Dividends.............................................. $ 95,451 $ -- $ 20,207 -------------------- -------------------- --------------------- EXPENSES: Mortality and expense risk charges..................... 22,893 18,930 18,819 -------------------- -------------------- --------------------- Net investment income (loss)...................... 72,558 (18,930) 1,388 -------------------- -------------------- --------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ 1,618,689 452,678 -- Realized gains (losses) on sale of investments......... 624,015 282,308 258,722 -------------------- -------------------- --------------------- Net realized gains (losses)....................... 2,242,704 734,986 258,722 -------------------- -------------------- --------------------- Change in unrealized gains (losses) on investments..... 5,169,026 1,736,369 (166,265) -------------------- -------------------- --------------------- Net realized and changes in unrealized gains (losses) on investments...................................... 7,411,730 2,471,355 92,457 -------------------- -------------------- --------------------- Net increase (decrease) in net assets resulting from operations..................................... $ 7,484,288 $ 2,452,425 $ 93,845 ==================== ==================== ===================== MSF LOOMIS SAYLES SMALL CAP GROWTH INVESTMENT DIVISION ------------------------------------------------------------------ 2013 2012 2011 -------------------- -------------------- -------------------- INVESTMENT INCOME: Dividends.............................................. $ -- $ -- $ -- -------------------- -------------------- -------------------- EXPENSES: Mortality and expense risk charges..................... 8,824 7,211 7,268 -------------------- -------------------- -------------------- Net investment income (loss)...................... (8,824) (7,211) (7,268) -------------------- -------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ -- -- -- Realized gains (losses) on sale of investments......... 444,863 192,524 104,198 -------------------- -------------------- -------------------- Net realized gains (losses)....................... 444,863 192,524 104,198 -------------------- -------------------- -------------------- Change in unrealized gains (losses) on investments..... 3,463,471 678,535 121,090 -------------------- -------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments...................................... 3,908,334 871,059 225,288 -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations..................................... $ 3,899,510 $ 863,848 $ 218,020 ==================== ==================== ====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 78 The accompanying notes are an integral part of these financial statements. 79 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
MSF MET/ARTISAN MID CAP VALUE INVESTMENT DIVISION -------------------------------------------------------------------- 2013 2012 2011 --------------------- -------------------- -------------------- INVESTMENT INCOME: Dividends.............................................. $ 561,888 $ 483,287 $ 455,060 --------------------- -------------------- -------------------- EXPENSES: Mortality and expense risk charges..................... 55,101 46,626 47,224 --------------------- -------------------- -------------------- Net investment income (loss)...................... 506,787 436,661 407,836 --------------------- -------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ -- -- -- Realized gains (losses) on sale of investments......... 684,691 (286,700) (412,007) --------------------- -------------------- -------------------- Net realized gains (losses)....................... 684,691 (286,700) (412,007) --------------------- -------------------- -------------------- Change in unrealized gains (losses) on investments..... 16,708,173 5,263,295 3,096,938 --------------------- -------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments...................................... 17,392,864 4,976,595 2,684,931 --------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations..................................... $ 17,899,651 $ 5,413,256 $ 3,092,767 ===================== ==================== ==================== MSF METLIFE CONSERVATIVE ALLOCATION INVESTMENT DIVISION --------------------------------------------------------------------- 2013 2012 2011 --------------------- --------------------- --------------------- INVESTMENT INCOME: Dividends.............................................. $ 169,434 $ 148,047 $ 98,787 --------------------- --------------------- --------------------- EXPENSES: Mortality and expense risk charges..................... 8,929 9,352 8,004 --------------------- --------------------- --------------------- Net investment income (loss)...................... 160,505 138,695 90,783 --------------------- --------------------- --------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ 25,756 114,982 -- Realized gains (losses) on sale of investments......... 56,127 59,284 77,218 --------------------- --------------------- --------------------- Net realized gains (losses)....................... 81,883 174,266 77,218 --------------------- --------------------- --------------------- Change in unrealized gains (losses) on investments..... (14,063) 123,869 (37,275) --------------------- --------------------- --------------------- Net realized and changes in unrealized gains (losses) on investments...................................... 67,820 298,135 39,943 --------------------- --------------------- --------------------- Net increase (decrease) in net assets resulting from operations..................................... $ 228,325 $ 436,830 $ 130,726 ===================== ===================== ===================== MSF METLIFE CONSERVATIVE TO MODERATE ALLOCATION INVESTMENT DIVISION -------------------------------------------------------------------- 2013 2012 2011 -------------------- -------------------- --------------------- INVESTMENT INCOME: Dividends.............................................. $ 252,710 $ 219,743 $ 156,398 -------------------- -------------------- --------------------- EXPENSES: Mortality and expense risk charges..................... 17,423 14,684 13,340 -------------------- -------------------- --------------------- Net investment income (loss)...................... 235,287 205,059 143,058 -------------------- -------------------- --------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ 95,776 21,976 -- Realized gains (losses) on sale of investments......... 210,565 59,559 135,436 -------------------- -------------------- --------------------- Net realized gains (losses)....................... 306,341 81,535 135,436 -------------------- -------------------- --------------------- Change in unrealized gains (losses) on investments..... 418,401 541,162 (210,123) -------------------- -------------------- --------------------- Net realized and changes in unrealized gains (losses) on investments...................................... 724,742 622,697 (74,687) -------------------- -------------------- --------------------- Net increase (decrease) in net assets resulting from operations..................................... $ 960,029 $ 827,756 $ 68,371 ==================== ==================== =====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 80 The accompanying notes are an integral part of these financial statements. 81 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
MSF METLIFE MID CAP STOCK INDEX INVESTMENT DIVISION -------------------------------------------------------------------- 2013 2012 2011 -------------------- --------------------- --------------------- INVESTMENT INCOME: Dividends.............................................. $ 981,648 $ 662,912 $ 593,088 -------------------- --------------------- --------------------- EXPENSES: Mortality and expense risk charges..................... 59,983 51,493 51,561 -------------------- --------------------- --------------------- Net investment income (loss)...................... 921,665 611,419 541,527 -------------------- --------------------- --------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ 2,405,800 2,787,031 2,722,599 Realized gains (losses) on sale of investments......... 1,774,205 830,830 678,616 -------------------- --------------------- --------------------- Net realized gains (losses)....................... 4,180,005 3,617,861 3,401,215 -------------------- --------------------- --------------------- Change in unrealized gains (losses) on investments..... 18,736,176 6,545,785 (4,954,472) -------------------- --------------------- --------------------- Net realized and changes in unrealized gains (losses) on investments...................................... 22,916,181 10,163,646 (1,553,257) -------------------- --------------------- --------------------- Net increase (decrease) in net assets resulting from operations..................................... $ 23,837,846 $ 10,775,065 $ (1,011,730) ==================== ===================== ===================== MSF METLIFE MODERATE ALLOCATION INVESTMENT DIVISION -------------------------------------------------------------------- 2013 2012 2011 -------------------- --------------------- --------------------- INVESTMENT INCOME: Dividends.............................................. $ 1,058,783 $ 1,056,014 $ 669,982 -------------------- --------------------- --------------------- EXPENSES: Mortality and expense risk charges..................... 79,987 72,676 67,625 -------------------- --------------------- --------------------- Net investment income (loss)...................... 978,796 983,338 602,357 -------------------- --------------------- --------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ 386,257 -- -- Realized gains (losses) on sale of investments......... 1,204,992 307,411 234,474 -------------------- --------------------- --------------------- Net realized gains (losses)....................... 1,591,249 307,411 234,474 -------------------- --------------------- --------------------- Change in unrealized gains (losses) on investments..... 5,640,223 3,912,908 (1,362,402) -------------------- --------------------- --------------------- Net realized and changes in unrealized gains (losses) on investments...................................... 7,231,472 4,220,319 (1,127,928) -------------------- --------------------- --------------------- Net increase (decrease) in net assets resulting from operations..................................... $ 8,210,268 $ 5,203,657 $ (525,571) ==================== ===================== ===================== MSF METLIFE MODERATE TO AGGRESSIVE ALLOCATION INVESTMENT DIVISION -------------------------------------------------------------------- 2013 2012 2011 -------------------- -------------------- --------------------- INVESTMENT INCOME: Dividends.............................................. $ 1,416,783 $ 1,528,175 $ 1,073,341 -------------------- -------------------- --------------------- EXPENSES: Mortality and expense risk charges..................... 85,508 75,645 72,954 -------------------- -------------------- --------------------- Net investment income (loss)...................... 1,331,275 1,452,530 1,000,387 -------------------- -------------------- --------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ -- -- -- Realized gains (losses) on sale of investments......... 1,631,177 342,924 112,005 -------------------- -------------------- --------------------- Net realized gains (losses)....................... 1,631,177 342,924 112,005 -------------------- -------------------- --------------------- Change in unrealized gains (losses) on investments..... 15,682,919 8,619,633 (3,772,324) -------------------- -------------------- --------------------- Net realized and changes in unrealized gains (losses) on investments...................................... 17,314,096 8,962,557 (3,660,319) -------------------- -------------------- --------------------- Net increase (decrease) in net assets resulting from operations..................................... $ 18,645,371 $ 10,415,087 $ (2,659,932) ==================== ==================== =====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 82 The accompanying notes are an integral part of these financial statements. 83 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
MSF METLIFE STOCK INDEX INVESTMENT DIVISION ------------------------------------------------------------------- 2013 2012 2011 -------------------- -------------------- -------------------- INVESTMENT INCOME: Dividends.............................................. $ 15,228,884 $ 12,674,264 $ 11,182,368 -------------------- -------------------- -------------------- EXPENSES: Mortality and expense risk charges..................... 1,937,634 1,725,734 1,662,241 -------------------- -------------------- -------------------- Net investment income (loss)...................... 13,291,250 10,948,530 9,520,127 -------------------- -------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ 12,357,151 5,087,401 4,115,111 Realized gains (losses) on sale of investments......... 12,306,567 3,743,076 (324,668) -------------------- -------------------- -------------------- Net realized gains (losses)....................... 24,663,718 8,830,477 3,790,443 -------------------- -------------------- -------------------- Change in unrealized gains (losses) on investments..... 191,004,236 82,239,455 (2,093,968) -------------------- -------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments...................................... 215,667,954 91,069,932 1,696,475 -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations..................................... $ 228,959,204 $ 102,018,462 $ 11,216,602 ==================== ==================== ==================== MSF MFS TOTAL RETURN INVESTMENT DIVISION ------------------------------------------------------------------ 2013 2012 2011 -------------------- -------------------- -------------------- INVESTMENT INCOME: Dividends.............................................. $ 226,568 $ 220,676 $ 208,852 -------------------- -------------------- -------------------- EXPENSES: Mortality and expense risk charges..................... 7,921 6,627 6,289 -------------------- -------------------- -------------------- Net investment income (loss)...................... 218,647 214,049 202,563 -------------------- -------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ -- -- -- Realized gains (losses) on sale of investments......... 99,210 32,260 (29,847) -------------------- -------------------- -------------------- Net realized gains (losses)....................... 99,210 32,260 (29,847) -------------------- -------------------- -------------------- Change in unrealized gains (losses) on investments..... 1,215,884 595,278 (11,189) -------------------- -------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments...................................... 1,315,094 627,538 (41,036) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations..................................... $ 1,533,741 $ 841,587 $ 161,527 ==================== ==================== ==================== MSF MFS VALUE INVESTMENT DIVISION ------------------------------------------------------------------- 2013 2012 2011 -------------------- --------------------- -------------------- INVESTMENT INCOME: Dividends.............................................. $ 1,234,016 $ 1,079,462 $ 836,589 -------------------- --------------------- -------------------- EXPENSES: Mortality and expense risk charges..................... 63,296 47,838 46,802 -------------------- --------------------- -------------------- Net investment income (loss)...................... 1,170,720 1,031,624 789,787 -------------------- --------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ 2,095,342 768,644 -- Realized gains (losses) on sale of investments......... 1,087,562 200,451 (44,982) -------------------- --------------------- -------------------- Net realized gains (losses)....................... 3,182,904 969,095 (44,982) -------------------- --------------------- -------------------- Change in unrealized gains (losses) on investments..... 17,288,533 6,505,435 (346,891) -------------------- --------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments...................................... 20,471,437 7,474,530 (391,873) -------------------- --------------------- -------------------- Net increase (decrease) in net assets resulting from operations..................................... $ 21,642,157 $ 8,506,154 $ 397,914 ==================== ===================== ====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 84 The accompanying notes are an integral part of these financial statements. 85 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
MSF MSCI EAFE INDEX INVESTMENT DIVISION ------------------------------------------------------------------ 2013 2012 2011 -------------------- -------------------- -------------------- INVESTMENT INCOME: Dividends.............................................. $ 2,250,635 $ 1,993,048 $ 1,549,893 -------------------- -------------------- -------------------- EXPENSES: Mortality and expense risk charges..................... 39,550 34,978 37,419 -------------------- -------------------- -------------------- Net investment income (loss)...................... 2,211,085 1,958,070 1,512,474 -------------------- -------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ -- -- -- Realized gains (losses) on sale of investments......... 838,301 (63,228) 137,025 -------------------- -------------------- -------------------- Net realized gains (losses)....................... 838,301 (63,228) 137,025 -------------------- -------------------- -------------------- Change in unrealized gains (losses) on investments..... 11,746,223 9,143,347 (9,604,700) -------------------- -------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments....................................... 12,584,524 9,080,119 (9,467,675) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations...................................... $ 14,795,609 $ 11,038,189 $ (7,955,201) ==================== ==================== ==================== MSF NEUBERGER BERMAN GENESIS INVESTMENT DIVISION ------------------------------------------------------------------ 2013 2012 2011 -------------------- -------------------- -------------------- INVESTMENT INCOME: Dividends.............................................. $ 744,713 $ 297,555 $ 596,562 -------------------- -------------------- -------------------- EXPENSES: Mortality and expense risk charges..................... 89,260 75,540 76,321 -------------------- -------------------- -------------------- Net investment income (loss)...................... 655,453 222,015 520,241 -------------------- -------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ -- -- -- Realized gains (losses) on sale of investments......... 614,602 (730,868) (976,828) -------------------- -------------------- -------------------- Net realized gains (losses)....................... 614,602 (730,868) (976,828) -------------------- -------------------- -------------------- Change in unrealized gains (losses) on investments..... 30,722,824 8,168,095 4,961,322 -------------------- -------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments....................................... 31,337,426 7,437,227 3,984,494 -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations...................................... $ 31,992,879 $ 7,659,242 $ 4,504,735 ==================== ==================== ==================== MSF RUSSELL 2000 INDEX INVESTMENT DIVISION ------------------------------------------------------------------ 2013 2012 2011 -------------------- -------------------- -------------------- INVESTMENT INCOME: Dividends.............................................. $ 982,173 $ 623,816 $ 561,526 -------------------- -------------------- -------------------- EXPENSES: Mortality and expense risk charges..................... 47,086 39,701 40,338 -------------------- -------------------- -------------------- Net investment income (loss)...................... 935,087 584,115 521,188 -------------------- -------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ -- -- -- Realized gains (losses) on sale of investments......... 1,797,318 721,576 734,988 -------------------- -------------------- -------------------- Net realized gains (losses)....................... 1,797,318 721,576 734,988 -------------------- -------------------- -------------------- Change in unrealized gains (losses) on investments..... 17,937,722 6,793,518 (3,300,203) -------------------- -------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments....................................... 19,735,040 7,515,094 (2,565,215) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations...................................... $ 20,670,127 $ 8,099,209 $ (2,044,027) ==================== ==================== ====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 86 The accompanying notes are an integral part of these financial statements. 87 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
MSF T. ROWE PRICE LARGE CAP GROWTH INVESTMENT DIVISION ------------------------------------------------------------------- 2013 2012 2011 -------------------- --------------------- -------------------- INVESTMENT INCOME: Dividends.............................................. $ 163,280 $ 58,548 $ 38,643 -------------------- --------------------- -------------------- EXPENSES: Mortality and expense risk charges..................... 41,708 23,330 20,886 -------------------- --------------------- -------------------- Net investment income (loss)...................... 121,572 35,218 17,757 -------------------- --------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ -- -- -- Realized gains (losses) on sale of investments......... 2,302,973 996,117 908,859 -------------------- --------------------- -------------------- Net realized gains (losses)....................... 2,302,973 996,117 908,859 -------------------- --------------------- -------------------- Change in unrealized gains (losses) on investments..... 19,823,349 6,924,755 (1,383,140) -------------------- --------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments...................................... 22,126,322 7,920,872 (474,281) -------------------- --------------------- -------------------- Net increase (decrease) in net assets resulting from operations..................................... $ 22,247,894 $ 7,956,090 $ (456,524) ==================== ===================== ==================== MSF T. ROWE PRICE SMALL CAP GROWTH INVESTMENT DIVISION ------------------------------------------------------------------- 2013 2012 2011 -------------------- --------------------- -------------------- INVESTMENT INCOME: Dividends.............................................. $ 373,197 $ -- $ -- -------------------- --------------------- -------------------- EXPENSES: Mortality and expense risk charges..................... 356,357 304,065 301,663 -------------------- --------------------- -------------------- Net investment income (loss)...................... 16,840 (304,065) (301,663) -------------------- --------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ 5,766,149 9,066,425 -- Realized gains (losses) on sale of investments......... 3,667,968 2,397,895 2,332,511 -------------------- --------------------- -------------------- Net realized gains (losses)....................... 9,434,117 11,464,320 2,332,511 -------------------- --------------------- -------------------- Change in unrealized gains (losses) on investments..... 30,236,593 2,263,900 (846,789) -------------------- --------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments...................................... 39,670,710 13,728,220 1,485,722 -------------------- --------------------- -------------------- Net increase (decrease) in net assets resulting from operations..................................... $ 39,687,550 $ 13,424,155 $ 1,184,059 ==================== ===================== ==================== MSF VAN ECK GLOBAL NATURAL RESOURCES INVESTMENT DIVISION -------------------------------------------------------------------- 2013 2012 2011 (f) --------------------- -------------------- --------------------- INVESTMENT INCOME: Dividends.............................................. $ 669 $ -- $ -- --------------------- -------------------- --------------------- EXPENSES: Mortality and expense risk charges..................... -- -- -- --------------------- -------------------- --------------------- Net investment income (loss)...................... 669 -- -- --------------------- -------------------- --------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ -- 2,613 -- Realized gains (losses) on sale of investments......... (55) (729) (45) --------------------- -------------------- --------------------- Net realized gains (losses)....................... (55) 1,884 (45) --------------------- -------------------- --------------------- Change in unrealized gains (losses) on investments..... 14,171 (2,269) (2,198) --------------------- -------------------- --------------------- Net realized and changes in unrealized gains (losses) on investments...................................... 14,116 (385) (2,243) --------------------- -------------------- --------------------- Net increase (decrease) in net assets resulting from operations..................................... $ 14,785 $ (385) $ (2,243) ===================== ==================== =====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 88 The accompanying notes are an integral part of these financial statements. 89 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
MSF WESTERN ASSET MANAGEMENT STRATEGIC BOND OPPORTUNITIES INVESTMENT DIVISION ------------------------------------------------------------------ 2013 2012 2011 -------------------- -------------------- -------------------- INVESTMENT INCOME: Dividends.............................................. $ 1,259,304 $ 891,838 $ 1,209,466 -------------------- -------------------- -------------------- EXPENSES: Mortality and expense risk charges..................... 33,218 32,820 31,783 -------------------- -------------------- -------------------- Net investment income (loss)...................... 1,226,086 859,018 1,177,683 -------------------- -------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ -- -- -- Realized gains (losses) on sale of investments......... 194,088 204,230 144,847 -------------------- -------------------- -------------------- Net realized gains (losses)....................... 194,088 204,230 144,847 -------------------- -------------------- -------------------- Change in unrealized gains (losses) on investments..... (1,174,913) 1,584,984 64,600 -------------------- -------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments...................................... (980,825) 1,789,214 209,447 -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations..................................... $ 245,261 $ 2,648,232 $ 1,387,130 ==================== ==================== ==================== MSF WESTERN ASSET MANAGEMENT U.S. GOVERNMENT INVESTMENT DIVISION ------------------------------------------------------------------- 2013 2012 2011 -------------------- -------------------- -------------------- INVESTMENT INCOME: Dividends.............................................. $ 353,673 $ 348,936 $ 248,608 -------------------- -------------------- -------------------- EXPENSES: Mortality and expense risk charges..................... 16,498 18,045 18,708 -------------------- -------------------- -------------------- Net investment income (loss)...................... 337,175 330,891 229,900 -------------------- -------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ -- -- 570,575 Realized gains (losses) on sale of investments......... 3,029 19,763 (5,603) -------------------- -------------------- -------------------- Net realized gains (losses)....................... 3,029 19,763 564,972 -------------------- -------------------- -------------------- Change in unrealized gains (losses) on investments..... (476,487) 185,906 82,587 -------------------- -------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments...................................... (473,458) 205,669 647,559 -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations..................................... $ (136,283) $ 536,560 $ 877,459 ==================== ==================== ==================== PIMCO VIT ALL ASSET INVESTMENT DIVISION ------------------------------------------------------------------- 2013 2012 2011 (f) --------------------- -------------------- -------------------- INVESTMENT INCOME: Dividends.............................................. $ 21,748 $ 6,301 $ 2,796 --------------------- -------------------- -------------------- EXPENSES: Mortality and expense risk charges..................... -- -- -- --------------------- -------------------- -------------------- Net investment income (loss)...................... 21,748 6,301 2,796 --------------------- -------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ -- -- -- Realized gains (losses) on sale of investments......... (591) 190 -- --------------------- -------------------- -------------------- Net realized gains (losses)....................... (591) 190 -- --------------------- -------------------- -------------------- Change in unrealized gains (losses) on investments..... (24,638) 8,832 (1,176) --------------------- -------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments...................................... (25,229) 9,022 (1,176) --------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations..................................... $ (3,481) $ 15,323 $ 1,620 ===================== ==================== ====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 90 The accompanying notes are an integral part of these financial statements. 91 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
PIMCO VIT COMMODITY REAL RETURN STRATEGY INVESTMENT DIVISION -------------------- 2013 (e) -------------------- INVESTMENT INCOME: Dividends............................ $ -- -------------------- EXPENSES: Mortality and expense risk charges... -- -------------------- Net investment income (loss).... -- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions.......... -- Realized gains (losses) on sale of investments........................ (5) -------------------- Net realized gains (losses)..... (5) -------------------- Change in unrealized gains (losses) on investments..................... (126) -------------------- Net realized and changes in unrealized gains (losses) on investments........................ (131) -------------------- Net increase (decrease) in net assets resulting from operations... $ (131) ==================== PIMCO VIT LOW DURATION INVESTMENT DIVISION ------------------------------------------------------------------ 2013 2012 2011 -------------------- -------------------- -------------------- INVESTMENT INCOME: Dividends............................ $ 22,872 $ 18,366 $ 13,732 -------------------- -------------------- -------------------- EXPENSES: Mortality and expense risk charges... -- -- -- -------------------- -------------------- -------------------- Net investment income (loss).... 22,872 18,366 13,732 -------------------- -------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions.......... -- -- -- Realized gains (losses) on sale of investments........................ 3,304 1,749 618 -------------------- -------------------- -------------------- Net realized gains (losses)..... 3,304 1,749 618 -------------------- -------------------- -------------------- Change in unrealized gains (losses) on investments..................... (33,450) 34,493 (6,243) -------------------- -------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments........................ (30,146) 36,242 (5,625) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations... $ (7,274) $ 54,608 $ 8,107 ==================== ==================== ==================== PIONEER VCT EMERGING MARKETS INVESTMENT DIVISION ------------------------------------------------------------------ 2013 2012 2011 -------------------- -------------------- -------------------- INVESTMENT INCOME: Dividends............................ $ 2,107 $ 1,600 -------------------- -------------------- -------------------- EXPENSES: Mortality and expense risk charges... -- -- -- -------------------- -------------------- -------------------- Net investment income (loss).... 2,107 1,600 -- -------------------- -------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions.......... -- 23,672 -- Realized gains (losses) on sale of investments........................ 7,544 (1,297) 121,447 -------------------- -------------------- -------------------- Net realized gains (losses)..... 7,544 22,375 121,447 -------------------- -------------------- -------------------- Change in unrealized gains (losses) on investments..................... (24,888) 20,209 (327,299) -------------------- -------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments........................ (17,344) 42,584 (205,852) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations... $ (15,237) $ 44,184 $ (205,852) ==================== ==================== ==================== PIONEER VCT MID CAP VALUE INVESTMENT DIVISION ----------------------------------------------------------------- 2013 2012 2011 -------------------- -------------------- ------------------- INVESTMENT INCOME: Dividends............................ $ 425 $ 1,561 $ 1,190 -------------------- -------------------- ------------------- EXPENSES: Mortality and expense risk charges... -- -- -- -------------------- -------------------- ------------------- Net investment income (loss).... 425 1,561 1,190 -------------------- -------------------- ------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions.......... -- -- -- Realized gains (losses) on sale of investments........................ 29,038 595 580 -------------------- -------------------- ------------------- Net realized gains (losses)..... 29,038 595 580 -------------------- -------------------- ------------------- Change in unrealized gains (losses) on investments..................... (1,134) 12,468 (11,556) -------------------- -------------------- ------------------- Net realized and changes in unrealized gains (losses) on investments........................ 27,904 13,063 (10,976) -------------------- -------------------- ------------------- Net increase (decrease) in net assets resulting from operations... $ 28,329 $ 14,624 $ (9,786) ==================== ==================== ===================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 92 The accompanying notes are an integral part of these financial statements. 93 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
PUTNAM VT INTERNATIONAL VALUE INVESTMENT DIVISION -------------------- 2013 (b) -------------------- INVESTMENT INCOME: Dividends............................ $ -- -------------------- EXPENSES: Mortality and expense risk charges... -- -------------------- Net investment income (loss).... -- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions.......... -- Realized gains (losses) on sale of investments....................... 10 -------------------- Net realized gains (losses)..... 10 -------------------- Change in unrealized gains (losses) on investments.................... 477 -------------------- Net realized and changes in unrealized gains (losses) on investments....................... 487 -------------------- Net increase (decrease) in net assets resulting from operations.. $ 487 ==================== ROYCE MICRO-CAP INVESTMENT DIVISION ------------------------------------------------------------------- 2013 2012 2011 -------------------- --------------------- -------------------- INVESTMENT INCOME: Dividends............................ $ 38 $ -- $ 8,331 -------------------- --------------------- -------------------- EXPENSES: Mortality and expense risk charges... -- -- -- -------------------- --------------------- -------------------- Net investment income (loss).... 38 -- 8,331 -------------------- --------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions.......... 197 8,060 -- Realized gains (losses) on sale of investments....................... 87,518 1,017 1,545 -------------------- --------------------- -------------------- Net realized gains (losses)..... 87,715 9,077 1,545 -------------------- --------------------- -------------------- Change in unrealized gains (losses) on investments.................... (23,953) 15,667 (52,132) -------------------- --------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments....................... 63,762 24,744 (50,587) -------------------- --------------------- -------------------- Net increase (decrease) in net assets resulting from operations.. $ 63,800 $ 24,744 $ (42,256) ==================== ===================== ==================== ROYCE SMALL-CAP INVESTMENT DIVISION -------------------------------------------------------------------- 2013 2012 2011 --------------------- -------------------- -------------------- INVESTMENT INCOME: Dividends............................ $ 6,679 $ 586 $ 3,804 --------------------- -------------------- -------------------- EXPENSES: Mortality and expense risk charges... -- -- -- --------------------- -------------------- -------------------- Net investment income (loss).... 6,679 586 3,804 --------------------- -------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions.......... 34,717 13,477 -- Realized gains (losses) on sale of investments....................... 34,201 22,187 18,080 --------------------- -------------------- -------------------- Net realized gains (losses)..... 68,918 35,664 18,080 --------------------- -------------------- -------------------- Change in unrealized gains (losses) on investments.................... 110,499 34,489 (64,398) --------------------- -------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments....................... 179,417 70,153 (46,318) --------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations.. $ 186,096 $ 70,739 $ (42,514) ===================== ==================== ==================== UIF EMERGING MARKETS DEBT INVESTMENT DIVISION -------------------------------------------------------------------- 2013 2012 2011 --------------------- -------------------- -------------------- INVESTMENT INCOME: Dividends............................ $ 51,315 $ 16,821 $ 7,775 --------------------- -------------------- -------------------- EXPENSES: Mortality and expense risk charges... -- -- -- --------------------- -------------------- -------------------- Net investment income (loss).... 51,315 16,821 7,775 --------------------- -------------------- -------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions.......... 15,729 -- 2,422 Realized gains (losses) on sale of investments....................... (4,843) 2,466 392 --------------------- -------------------- -------------------- Net realized gains (losses)..... 10,886 2,466 2,814 --------------------- -------------------- -------------------- Change in unrealized gains (losses) on investments.................... (181,259) 89,788 79 --------------------- -------------------- -------------------- Net realized and changes in unrealized gains (losses) on investments....................... (170,373) 92,254 2,893 --------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations.. $ (119,058) $ 109,075 $ 10,668 ===================== ==================== ====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 94 The accompanying notes are an integral part of these financial statements. 95 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF OPERATIONS -- (CONCLUDED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
UIF EMERGING MARKETS EQUITY INVESTMENT DIVISION -------------------------------------------------------------------- 2013 2012 2011 -------------------- -------------------- --------------------- INVESTMENT INCOME: Dividends.............................................. $ 14,065 $ -- $ 1,515 -------------------- -------------------- --------------------- EXPENSES: Mortality and expense risk charges..................... -- -- -- -------------------- -------------------- --------------------- Net investment income (loss)...................... 14,065 -- 1,515 -------------------- -------------------- --------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ -- -- -- Realized gains (losses) on sale of investments......... 6,766 (26) 4,478 -------------------- -------------------- --------------------- Net realized gains (losses)....................... 6,766 (26) 4,478 -------------------- -------------------- --------------------- Change in unrealized gains (losses) on investments..... (38,224) 139,206 (99,779) -------------------- -------------------- --------------------- Net realized and changes in unrealized gains (losses) on investments...................................... (31,458) 139,180 (95,301) -------------------- -------------------- --------------------- Net increase (decrease) in net assets resulting from operations..................................... $ (17,393) $ 139,180 $ (93,786) ==================== ==================== ===================== WELLS FARGO VT TOTAL RETURN BOND INVESTMENT DIVISION -------------------------------------------------------------------- 2013 2012 2011 -------------------- --------------------- --------------------- INVESTMENT INCOME: Dividends.............................................. $ 4,298 $ 4,369 $ 18,903 -------------------- --------------------- --------------------- EXPENSES: Mortality and expense risk charges..................... -- -- -- -------------------- --------------------- --------------------- Net investment income (loss)...................... 4,298 4,369 18,903 -------------------- --------------------- --------------------- NET REALIZED AND CHANGES IN UNREALIZED GAINS (LOSSES) ON INVESTMENTS: Realized gain distributions............................ 9,579 6,160 30,313 Realized gains (losses) on sale of investments......... 1,277 1,595 15,483 -------------------- --------------------- --------------------- Net realized gains (losses)....................... 10,856 7,755 45,796 -------------------- --------------------- --------------------- Change in unrealized gains (losses) on investments..... (21,523) 5,968 (7,169) -------------------- --------------------- --------------------- Net realized and changes in unrealized gains (losses) on investments...................................... (10,667) 13,723 38,627 -------------------- --------------------- --------------------- Net increase (decrease) in net assets resulting from operations..................................... $ (6,369) $ 18,092 $ 57,530 ==================== ===================== =====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 96 The accompanying notes are an integral part of these financial statements. 97 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
ALLIANCEBERNSTEIN GLOBAL THEMATIC GROWTH INVESTMENT DIVISION --------------------------------------------------------------------- 2013 2012 2011 -------------------- --------------------- --------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 13 $ -- $ 18,192 Net realized gains (losses)......................... (1,496) (1,307,724) (40,514) Change in unrealized gains (losses) on investments.. 14,581 1,419,031 (1,444,286) -------------------- --------------------- --------------------- Net increase (decrease) in net assets resulting from operations................................ 13,098 111,307 (1,466,608) -------------------- --------------------- --------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 1,269 4,561 6,425 Net transfers (including fixed account)............. 6,694 (4,345,166) 5,890,970 Policy charges...................................... (2,064) (2,096) (229,188) Transfers for policy benefits and terminations...... (14,687) (445) (27,392) -------------------- --------------------- --------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (8,788) (4,343,146) 5,640,815 -------------------- --------------------- --------------------- Net increase (decrease) in net assets............. 4,310 (4,231,839) 4,174,207 NET ASSETS: Beginning of year................................... 61,856 4,293,695 119,488 -------------------- --------------------- --------------------- End of year......................................... $ 66,166 $ 61,856 $ 4,293,695 ==================== ===================== ===================== ALLIANCEBERNSTEIN INTERMEDIATE BOND INVESTMENT DIVISION -------------------------------------------------------------------- 2013 2012 2011 -------------------- -------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 1,888 $ 2,404 $ 2,097 Net realized gains (losses)......................... 1,651 1,787 184 Change in unrealized gains (losses) on investments.. (5,086) (188) 563 -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations................................ (1,547) 4,003 2,844 -------------------- -------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ -- 8,926 2,678 Net transfers (including fixed account)............. (42,312) 44,909 -- Policy charges...................................... (1,794) (1,818) (1,493) Transfers for policy benefits and terminations...... (32) (6) (8) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (44,138) 52,011 1,177 -------------------- -------------------- -------------------- Net increase (decrease) in net assets............. (45,685) 56,014 4,021 NET ASSETS: Beginning of year................................... 103,300 47,286 43,265 -------------------- -------------------- -------------------- End of year......................................... $ 57,615 $ 103,300 $ 47,286 ==================== ==================== ==================== AMERICAN CENTURY VP VISTA INVESTMENT DIVISION --------------------------------------------------------------------- 2013 2012 2011 -------------------- --------------------- --------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ -- $ -- $ -- Net realized gains (losses)......................... 1,084 328 5,995 Change in unrealized gains (losses) on investments.. (55) 873 (8,184) -------------------- --------------------- --------------------- Net increase (decrease) in net assets resulting from operations................................ 1,029 1,201 (2,189) -------------------- --------------------- --------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ -- -- 11,044 Net transfers (including fixed account)............. (8) 870 (72,025) Policy charges...................................... (554) (954) (2,331) Transfers for policy benefits and terminations...... (3,862) (5,666) -- -------------------- --------------------- --------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (4,424) (5,750) (63,312) -------------------- --------------------- --------------------- Net increase (decrease) in net assets............. (3,395) (4,549) (65,501) NET ASSETS: Beginning of year................................... 4,105 8,654 74,155 -------------------- --------------------- --------------------- End of year......................................... $ 710 $ 4,105 $ 8,654 ==================== ===================== =====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 98 The accompanying notes are an integral part of these financial statements. 99 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
AMERICAN FUNDS BOND INVESTMENT DIVISION -------------------------------------------------------------------- 2013 2012 2011 -------------------- -------------------- --------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 91,592 $ 123,941 $ 132,520 Net realized gains (losses)......................... 62,302 27,506 10,695 Change in unrealized gains (losses) on investments.. (282,587) 108,693 121,054 -------------------- -------------------- --------------------- Net increase (decrease) in net assets resulting from operations................................ (128,693) 260,140 264,269 -------------------- -------------------- --------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 663,938 681,465 678,665 Net transfers (including fixed account)............. 291,663 491,460 53,187 Policy charges...................................... (373,489) (388,415) (360,088) Transfers for policy benefits and terminations...... (284,454) (359,799) (265,605) -------------------- -------------------- --------------------- Net increase (decrease) in net assets resulting from policy transactions....................... 297,658 424,711 106,159 -------------------- -------------------- --------------------- Net increase (decrease) in net assets............. 168,965 684,851 370,428 NET ASSETS: Beginning of year................................... 5,420,310 4,735,459 4,365,031 -------------------- -------------------- --------------------- End of year......................................... $ 5,589,275 $ 5,420,310 $ 4,735,459 ==================== ==================== ===================== AMERICAN FUNDS GLOBAL SMALL CAPITALIZATION INVESTMENT DIVISION -------------------------------------------------------------------- 2013 2012 2011 --------------------- -------------------- --------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 481,756 $ 681,533 $ 727,300 Net realized gains (losses)......................... 556,105 (342,892) (68,423) Change in unrealized gains (losses) on investments.. 15,213,508 9,028,936 (13,188,181) --------------------- -------------------- --------------------- Net increase (decrease) in net assets resulting from operations................................ 16,251,369 9,367,577 (12,529,304) --------------------- -------------------- --------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 6,319,815 6,754,997 7,605,640 Net transfers (including fixed account)............. (1,380,353) (1,743,129) (1,805,503) Policy charges...................................... (3,857,829) (3,801,507) (4,142,061) Transfers for policy benefits and terminations...... (4,504,188) (3,815,121) (4,059,136) --------------------- -------------------- --------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (3,422,555) (2,604,760) (2,401,060) --------------------- -------------------- --------------------- Net increase (decrease) in net assets............. 12,828,814 6,762,817 (14,930,364) NET ASSETS: Beginning of year................................... 59,237,806 52,474,989 67,405,353 --------------------- -------------------- --------------------- End of year......................................... $ 72,066,620 $ 59,237,806 $ 52,474,989 ===================== ==================== ===================== AMERICAN FUNDS GROWTH INVESTMENT DIVISION ------------------------------------------------------------------- 2013 2012 2011 -------------------- -------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 1,225,604 $ 879,818 $ 630,009 Net realized gains (losses)......................... 2,872,251 1,170,827 658,869 Change in unrealized gains (losses) on investments.. 34,086,809 18,556,699 (6,628,058) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations................................ 38,184,664 20,607,344 (5,339,180) -------------------- -------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 12,807,035 13,860,300 15,130,932 Net transfers (including fixed account)............. (2,855,702) (3,812,042) (1,178,160) Policy charges...................................... (8,755,241) (8,845,036) (9,007,053) Transfers for policy benefits and terminations...... (9,748,734) (9,088,854) (8,844,884) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (8,552,642) (7,885,632) (3,899,165) -------------------- -------------------- -------------------- Net increase (decrease) in net assets............. 29,632,022 12,721,712 (9,238,345) NET ASSETS: Beginning of year................................... 130,921,222 118,199,510 127,437,855 -------------------- -------------------- -------------------- End of year......................................... $ 160,553,244 $ 130,921,222 $ 118,199,510 ==================== ==================== ====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 100 The accompanying notes are an integral part of these financial statements. 101 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
AMERICAN FUNDS GROWTH-INCOME INVESTMENT DIVISION ------------------------------------------------------------------- 2013 2012 2011 -------------------- -------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 1,145,692 $ 1,175,138 $ 1,070,960 Net realized gains (losses)......................... 1,441,252 300,932 (58,726) Change in unrealized gains (losses) on investments.. 23,374,516 10,629,027 (2,428,568) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations................................ 25,961,460 12,105,097 (1,416,334) -------------------- -------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 8,145,719 8,728,377 9,556,841 Net transfers (including fixed account)............. (404,802) (1,135,580) (457,407) Policy charges...................................... (5,713,396) (5,615,768) (5,547,870) Transfers for policy benefits and terminations...... (6,390,541) (5,724,226) (4,739,607) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (4,363,020) (3,747,197) (1,188,043) -------------------- -------------------- -------------------- Net increase (decrease) in net assets............. 21,598,440 8,357,900 (2,604,377) NET ASSETS: Beginning of year................................... 79,614,717 71,256,817 73,861,194 -------------------- -------------------- -------------------- End of year......................................... $ 101,213,157 $ 79,614,717 $ 71,256,817 ==================== ==================== ==================== AMERICAN FUNDS HIGH-INCOME BOND INVESTMENT DIVISION ------------------------------------------- 2013 2012 (a) -------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 1,146 $ 3,203 Net realized gains (losses)......................... (51) 6 Change in unrealized gains (losses) on investments.. 426 (677) -------------------- -------------------- Net increase (decrease) in net assets resulting from operations................................ 1,521 2,532 -------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ -- -- Net transfers (including fixed account)............. (30,932) 54,888 Policy charges...................................... (212) (181) Transfers for policy benefits and terminations...... (10,061) (8) -------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (41,205) 54,699 -------------------- -------------------- Net increase (decrease) in net assets............. (39,684) 57,231 NET ASSETS: Beginning of year................................... 57,231 -- -------------------- -------------------- End of year......................................... $ 17,547 $ 57,231 ==================== ==================== AMERICAN FUNDS INTERNATIONAL INVESTMENT DIVISION ------------------------------------------------------------------- 2013 2012 2011 -------------------- -------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 7,749 $ 7,535 $ 10,736 Net realized gains (losses)......................... 27,615 (1,402) (605) Change in unrealized gains (losses) on investments.. 63,361 82,398 (108,507) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations................................ 98,725 88,531 (98,376) -------------------- -------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 4,396 46,649 4,120 Net transfers (including fixed account)............. 63,675 (25,495) (89,752) Policy charges...................................... (9,192) (12,774) (18,135) Transfers for policy benefits and terminations...... (24,265) (69,569) (82,771) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... 34,614 (61,189) (186,538) -------------------- -------------------- -------------------- Net increase (decrease) in net assets............. 133,339 27,342 (284,914) NET ASSETS: Beginning of year................................... 552,053 524,711 809,625 -------------------- -------------------- -------------------- End of year......................................... $ 685,392 $ 552,053 $ 524,711 ==================== ==================== ====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 102 The accompanying notes are an integral part of these financial statements. 103 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
AMERICAN FUNDS U.S. GOVERNMENT/AAA-RATED SECURITIES INVESTMENT DIVISION -------------------------------------------------------------------- 2013 2012 2011 -------------------- -------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 317 $ 440 $ 773 Net realized gains (losses)......................... 1,230 1,510 1,620 Change in unrealized gains (losses) on investments.. (2,996) (1,126) 885 -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations................................ (1,449) 824 3,278 -------------------- -------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 4,239 6,275 18,071 Net transfers (including fixed account)............. 289 -- (2,592) Policy charges...................................... (1,787) (1,867) (9,064) Transfers for policy benefits and terminations...... -- (5,579) (1,984) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... 2,741 (1,171) 4,431 -------------------- -------------------- -------------------- Net increase (decrease) in net assets............. 1,292 (347) 7,709 NET ASSETS: Beginning of year................................... 45,192 45,539 37,830 -------------------- -------------------- -------------------- End of year......................................... $ 46,484 $ 45,192 $ 45,539 ==================== ==================== ==================== DREYFUS VIF INTERNATIONAL VALUE INVESTMENT DIVISION --------------------------------------------------------------------- 2013 2012 2011 --------------------- --------------------- --------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 4,021 $ 4,882 $ 4,085 Net realized gains (losses)......................... (906) (1,011) (960) Change in unrealized gains (losses) on investments.. 42,909 18,857 (45,726) --------------------- --------------------- --------------------- Net increase (decrease) in net assets resulting from operations................................ 46,024 22,728 (42,601) --------------------- --------------------- --------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ -- 895 1,458 Net transfers (including fixed account)............. (2,380) 6 (1,532) Policy charges...................................... (2,445) (2,557) (3,962) Transfers for policy benefits and terminations...... (15) -- (766) --------------------- --------------------- --------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (4,840) (1,656) (4,802) --------------------- --------------------- --------------------- Net increase (decrease) in net assets............. 41,184 21,072 (47,403) NET ASSETS: Beginning of year................................... 205,133 184,061 231,464 --------------------- --------------------- --------------------- End of year......................................... $ 246,317 $ 205,133 $ 184,061 ===================== ===================== ===================== FIDELITY VIP ASSET MANAGER: GROWTH INVESTMENT DIVISION -------------------------------------------------------------------- 2013 2012 2011 -------------------- -------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 16,073 $ 24,972 $ 23,605 Net realized gains (losses)......................... 115,489 35,697 74,260 Change in unrealized gains (losses) on investments.. 260,059 172,026 (205,700) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations................................ 391,621 232,695 (107,835) -------------------- -------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 116,700 122,067 182,388 Net transfers (including fixed account)............. (143,822) 249,730 (79,369) Policy charges...................................... (76,211) (68,776) (78,031) Transfers for policy benefits and terminations...... (324,598) -- (392,245) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (427,931) 303,021 (367,257) -------------------- -------------------- -------------------- Net increase (decrease) in net assets............. (36,310) 535,716 (475,092) NET ASSETS: Beginning of year................................... 1,966,232 1,430,516 1,905,608 -------------------- -------------------- -------------------- End of year......................................... $ 1,929,922 $ 1,966,232 $ 1,430,516 ==================== ==================== ====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 104 The accompanying notes are an integral part of these financial statements. 105 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
FIDELITY VIP CONTRAFUND INVESTMENT DIVISION ---------------------------------------------------------------------- 2013 2012 2011 --------------------- --------------------- ---------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 23,521 $ 28,837 $ 20,916 Net realized gains (losses)......................... 147,133 38,806 12,745 Change in unrealized gains (losses) on investments.. 505,651 288,092 (98,141) --------------------- --------------------- ---------------------- Net increase (decrease) in net assets resulting from operations................................ 676,305 355,735 (64,480) --------------------- --------------------- ---------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 94,804 127,751 206,289 Net transfers (including fixed account)............. (270,104) (78,043) (243,464) Policy charges...................................... (97,806) (99,800) (104,834) Transfers for policy benefits and terminations...... (95,919) (114,270) (319,235) --------------------- --------------------- ---------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (369,025) (164,362) (461,244) --------------------- --------------------- ---------------------- Net increase (decrease) in net assets............ 307,280 191,373 (525,724) NET ASSETS: Beginning of year................................... 2,343,022 2,151,649 2,677,373 --------------------- --------------------- ---------------------- End of year......................................... $ 2,650,302 $ 2,343,022 $ 2,151,649 ===================== ===================== ====================== FIDELITY VIP EQUITY-INCOME INVESTMENT DIVISION --------------------------------------------------------------------- 2013 2012 2011 --------------------- --------------------- --------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 752 $ 1,836 $ 637 Net realized gains (losses)......................... 4,118 3,239 2,625 Change in unrealized gains (losses) on investments.. 3,227 (1,146) (8,921) --------------------- --------------------- --------------------- Net increase (decrease) in net assets resulting from operations................................ 8,097 3,929 (5,659) --------------------- --------------------- --------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 7,468 1,366 26,285 Net transfers (including fixed account)............. (43,901) 39,024 (55,376) Policy charges...................................... (491) (617) (4,868) Transfers for policy benefits and terminations...... -- -- (144,483) --------------------- --------------------- --------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (36,924) 39,773 (178,442) --------------------- --------------------- --------------------- Net increase (decrease) in net assets............ (28,827) 43,702 (184,101) NET ASSETS: Beginning of year................................... 62,291 18,589 202,690 --------------------- --------------------- --------------------- End of year......................................... $ 33,464 $ 62,291 $ 18,589 ===================== ===================== ===================== FIDELITY VIP FREEDOM 2010 INVESTMENT DIVISION ---------------------------------------------------------------------- 2013 2012 2011 --------------------- --------------------- --------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 563 $ 564 $ 576 Net realized gains (losses)......................... 665 633 1,481 Change in unrealized gains (losses) on investments.. 3,994 2,707 (2,344) --------------------- --------------------- --------------------- Net increase (decrease) in net assets resulting from operations................................ 5,222 3,904 (287) --------------------- --------------------- --------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 2,634 2,629 2,823 Net transfers (including fixed account)............. -- 210 884 Policy charges...................................... -- -- -- Transfers for policy benefits and terminations...... (1,252) (1,249) (1,136) --------------------- --------------------- --------------------- Net increase (decrease) in net assets resulting from policy transactions....................... 1,382 1,590 2,571 --------------------- --------------------- --------------------- Net increase (decrease) in net assets............ 6,604 5,494 2,284 NET ASSETS: Beginning of year................................... 39,638 34,144 31,860 --------------------- --------------------- --------------------- End of year......................................... $ 46,242 $ 39,638 $ 34,144 ===================== ===================== =====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 106 The accompanying notes are an integral part of these financial statements. 107 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
FIDELITY VIP FREEDOM 2020 INVESTMENT DIVISION ------------------------------------------------------------- 2013 2012 2011 ------------------- ------------------- ------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 16,012 $ 14,905 $ 15,048 Net realized gains (losses)......................... 21,982 14,637 12,805 Change in unrealized gains (losses) on investments.. 93,753 62,352 (33,543) ------------------- ------------------- ------------------- Net increase (decrease) in net assets resulting from operations................................ 131,747 91,894 (5,690) ------------------- ------------------- ------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 13,583 13,429 12,681 Net transfers (including fixed account)............. 94,207 (20,603) 33,211 Policy charges...................................... (11,540) (10,886) (10,197) Transfers for policy benefits and terminations...... (15,006) (8,824) (68,993) ------------------- ------------------- ------------------- Net increase (decrease) in net assets resulting from policy transactions....................... 81,244 (26,884) (33,298) ------------------- ------------------- ------------------- Net increase (decrease) in net assets............ 212,991 65,010 (38,988) NET ASSETS: Beginning of year................................... 764,724 699,714 738,702 ------------------- ------------------- ------------------- End of year......................................... $ 977,715 $ 764,724 $ 699,714 =================== =================== =================== FIDELITY VIP FREEDOM 2025 INVESTMENT DIVISION -------------------- 2013 (b) -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 694 Net realized gains (losses)......................... 413 Change in unrealized gains (losses) on investments.. 3,626 -------------------- Net increase (decrease) in net assets resulting from operations................................ 4,733 -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ -- Net transfers (including fixed account)............. 38,425 Policy charges...................................... (2,977) Transfers for policy benefits and terminations...... -- -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... 35,448 -------------------- Net increase (decrease) in net assets............ 40,181 NET ASSETS: Beginning of year................................... -- -------------------- End of year......................................... $ 40,181 ==================== FIDELITY VIP FREEDOM 2030 INVESTMENT DIVISION ------------------------------------------------------------- 2013 2012 2011 ------------------- ------------------- ------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 763 $ 665 $ 1,018 Net realized gains (losses)......................... 3,547 3,280 11,923 Change in unrealized gains (losses) on investments.. 5,619 3,591 (12,843) ------------------- ------------------- ------------------- Net increase (decrease) in net assets resulting from operations................................ 9,929 7,536 98 ------------------- ------------------- ------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 8,643 1,320 2,634 Net transfers (including fixed account)............. 618 (21,760) (51,129) Policy charges...................................... -- -- (455) Transfers for policy benefits and terminations...... -- (1,232) (2,369) ------------------- ------------------- ------------------- Net increase (decrease) in net assets resulting from policy transactions....................... 9,261 (21,672) (51,319) ------------------- ------------------- ------------------- Net increase (decrease) in net assets............ 19,190 (14,136) (51,221) NET ASSETS: Beginning of year................................... 42,834 56,970 108,191 ------------------- ------------------- ------------------- End of year......................................... $ 62,024 $ 42,834 $ 56,970 =================== =================== =================== FIDELITY VIP FREEDOM 2040 INVESTMENT DIVISION ------------------- 2013 (c) ------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 153 Net realized gains (losses)......................... 80 Change in unrealized gains (losses) on investments.. 545 ------------------- Net increase (decrease) in net assets resulting from operations................................ 778 ------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 4,187 Net transfers (including fixed account)............. 6,866 Policy charges...................................... -- Transfers for policy benefits and terminations...... -- ------------------- Net increase (decrease) in net assets resulting from policy transactions....................... 11,053 ------------------- Net increase (decrease) in net assets............ 11,831 NET ASSETS: Beginning of year................................... -- ------------------- End of year......................................... $ 11,831 =================== FIDELITY VIP FREEDOM 2050 INVESTMENT DIVISION ------------------------------------------------------------ 2013 2012 2011 (d) ------------------- ------------------- ------------------ INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 195 $ 283 $ 228 Net realized gains (losses)......................... 323 2,160 (3,654) Change in unrealized gains (losses) on investments.. 4,037 199 1,450 ------------------- ------------------- ------------------ Net increase (decrease) in net assets resulting from operations................................ 4,555 2,642 (1,976) ------------------- ------------------- ------------------ POLICY TRANSACTIONS: Premium payments received from policy owners........ 13 -- -- Net transfers (including fixed account)............. -- -- 17,414 Policy charges...................................... -- -- -- Transfers for policy benefits and terminations...... (353) (281) -- ------------------- ------------------- ------------------ Net increase (decrease) in net assets resulting from policy transactions....................... (340) (281) 17,414 ------------------- ------------------- ------------------ Net increase (decrease) in net assets............ 4,215 2,361 15,438 NET ASSETS: Beginning of year................................... 17,799 15,438 -- ------------------- ------------------- ------------------ End of year......................................... $ 22,014 $ 17,799 $ 15,438 =================== =================== ==================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 108 The accompanying notes are an integral part of these financial statements. 109 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
FIDELITY VIP HIGH INCOME INVESTMENT DIVISION ---------------------------------------------------------------------- 2013 2012 2011 --------------------- --------------------- --------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 9,677 $ 9,229 $ 2,953 Net realized gains (losses)......................... 73 67 13 Change in unrealized gains (losses) on investments.. (126) (1,277) (1,768) --------------------- --------------------- --------------------- Net increase (decrease) in net assets resulting from operations................................ 9,624 8,019 1,198 --------------------- --------------------- --------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ -- 1,301 3,335 Net transfers (including fixed account)............. 70 115,054 34,562 Policy charges...................................... (4,648) (2,451) (357) Transfers for policy benefits and terminations...... (2,200) -- (80) --------------------- --------------------- --------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (6,778) 113,904 37,460 --------------------- --------------------- --------------------- Net increase (decrease) in net assets............ 2,846 121,923 38,658 NET ASSETS: Beginning of year................................... 165,146 43,223 4,565 --------------------- --------------------- --------------------- End of year......................................... $ 167,992 $ 165,146 $ 43,223 ===================== ===================== ===================== FIDELITY VIP INVESTMENT GRADE BOND INVESTMENT DIVISION --------------------------------------------------------------------- 2013 2012 2011 --------------------- --------------------- --------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 39,909 $ 37,562 $ 54,637 Net realized gains (losses)......................... (7,423) 81,674 21,189 Change in unrealized gains (losses) on investments.. (76,349) (8,975) 1,742 --------------------- --------------------- --------------------- Net increase (decrease) in net assets resulting from operations................................ (43,863) 110,261 77,568 --------------------- --------------------- --------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 2,145 829 1,122 Net transfers (including fixed account)............. (522,146) 464,291 1,150,764 Policy charges...................................... (21,723) (27,932) (16,946) Transfers for policy benefits and terminations...... -- (9,509) -- --------------------- --------------------- --------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (541,724) 427,679 1,134,940 --------------------- --------------------- --------------------- Net increase (decrease) in net assets............ (585,587) 537,940 1,212,508 NET ASSETS: Beginning of year................................... 2,285,792 1,747,852 535,344 --------------------- --------------------- --------------------- End of year......................................... $ 1,700,205 $ 2,285,792 $ 1,747,852 ===================== ===================== ===================== FIDELITY VIP MID CAP INVESTMENT DIVISION --------------------------------------------------------------------- 2013 2012 2011 --------------------- --------------------- --------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 613 $ 2,865 $ 150 Net realized gains (losses)......................... 208,214 67,641 12,027 Change in unrealized gains (losses) on investments.. 1,232 20,392 (60,535) --------------------- --------------------- --------------------- Net increase (decrease) in net assets resulting from operations................................ 210,059 90,898 (48,358) --------------------- --------------------- --------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ -- 78,618 5,952 Net transfers (including fixed account)............. (635,978) 25,075 253,173 Policy charges...................................... (15,043) (15,222) (11,223) Transfers for policy benefits and terminations...... (58,870) (44,408) (47,617) --------------------- --------------------- --------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (709,891) 44,063 200,285 --------------------- --------------------- --------------------- Net increase (decrease) in net assets............ (499,832) 134,961 151,927 NET ASSETS: Beginning of year................................... 748,919 613,958 462,031 --------------------- --------------------- --------------------- End of year......................................... $ 249,087 $ 748,919 $ 613,958 ===================== ===================== =====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 110 The accompanying notes are an integral part of these financial statements. 111 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
FTVIPT FRANKLIN INCOME SECURITIES INVESTMENT DIVISION -------------------- 2013 (e) -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ -- Net realized gains (losses)......................... 3 Change in unrealized gains (losses) on investments.. 8 -------------------- Net increase (decrease) in net assets resulting from operations................................ 11 -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 23 Net transfers (including fixed account)............. 595 Policy charges...................................... (10) Transfers for policy benefits and terminations...... (1) -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... 607 -------------------- Net increase (decrease) in net assets............. 618 NET ASSETS: Beginning of year................................... -- -------------------- End of year......................................... $ 618 ==================== FTVIPT MUTUAL GLOBAL DISCOVERY SECURITIES INVESTMENT DIVISION ------------------------------------------------------------ 2013 2012 2011 ------------------- ------------------- ------------------ INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 19,686 $ 21,682 $ 22,691 Net realized gains (losses)......................... 141,155 49,608 1,929 Change in unrealized gains (losses) on investments.. 47,244 33,439 (59,670) ------------------- ------------------- ------------------ Net increase (decrease) in net assets resulting from operations................................ 208,085 104,729 (35,050) ------------------- ------------------- ------------------ POLICY TRANSACTIONS: Premium payments received from policy owners........ 10,185 83,607 53,641 Net transfers (including fixed account)............. (460,707) (97,388) 113,146 Policy charges...................................... (21,702) (22,528) (24,225) Transfers for policy benefits and terminations...... (44,103) (49,079) (291,009) ------------------- ------------------- ------------------ Net increase (decrease) in net assets resulting from policy transactions....................... (516,327) (85,388) (148,447) ------------------- ------------------- ------------------ Net increase (decrease) in net assets............. (308,242) 19,341 (183,497) NET ASSETS: Beginning of year................................... 803,176 783,835 967,332 ------------------- ------------------- ------------------ End of year......................................... $ 494,934 $ 803,176 $ 783,835 =================== =================== ================== FTVIPT MUTUAL SHARES SECURITIES INVESTMENT DIVISION -------------------- 2013 (e) -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 445 Net realized gains (losses)......................... 105 Change in unrealized gains (losses) on investments.. 2,000 -------------------- Net increase (decrease) in net assets resulting from operations................................ 2,550 -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 776 Net transfers (including fixed account)............. 21,718 Policy charges...................................... (833) Transfers for policy benefits and terminations...... (3) -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... 21,658 -------------------- Net increase (decrease) in net assets............. 24,208 NET ASSETS: Beginning of year................................... -- -------------------- End of year......................................... $ 24,208 ==================== FTVIPT TEMPLETON FOREIGN SECURITIES INVESTMENT DIVISION ----------------------------------------------------------- 2013 2012 2011 ------------------ ------------------ ------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 98,174 $ 115,174 $ 89,150 Net realized gains (losses)......................... 73,110 (16,852) 253,750 Change in unrealized gains (losses) on investments.. 689,874 501,451 (552,735) ------------------ ------------------ ------------------- Net increase (decrease) in net assets resulting from operations................................ 861,158 599,773 (209,835) ------------------ ------------------ ------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 285,991 303,212 379,032 Net transfers (including fixed account)............. 70,380 178,098 (5,636,582) Policy charges...................................... (155,044) (140,398) (243,478) Transfers for policy benefits and terminations...... (619,261) -- (512,046) ------------------ ------------------ ------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (417,934) 340,912 (6,013,074) ------------------ ------------------ ------------------- Net increase (decrease) in net assets............. 443,224 940,685 (6,222,909) NET ASSETS: Beginning of year................................... 3,962,470 3,021,785 9,244,694 ------------------ ------------------ ------------------- End of year......................................... $ 4,405,694 $ 3,962,470 $ 3,021,785 ================== ================== =================== FTVIPT TEMPLETON GLOBAL BOND SECURITIES INVESTMENT DIVISION ------------------------------------------------------------ 2013 2012 2011 ------------------ ------------------- ------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 20,975 $ 24,244 $ 10,824 Net realized gains (losses)......................... 6,447 352 (11,299) Change in unrealized gains (losses) on investments.. (6,052) 26,566 (11,949) ------------------ ------------------- ------------------- Net increase (decrease) in net assets resulting from operations................................ 21,370 51,162 (12,424) ------------------ ------------------- ------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 16,330 41,308 38,191 Net transfers (including fixed account)............. 881,830 73,730 482,861 Policy charges...................................... (20,444) (10,633) (7,628) Transfers for policy benefits and terminations...... (23,473) (2,811) (215,383) ------------------ ------------------- ------------------- Net increase (decrease) in net assets resulting from policy transactions....................... 854,243 101,594 298,041 ------------------ ------------------- ------------------- Net increase (decrease) in net assets............. 875,613 152,756 285,617 NET ASSETS: Beginning of year................................... 442,101 289,345 3,728 ------------------ ------------------- ------------------- End of year......................................... $ 1,317,714 $ 442,101 $ 289,345 ================== =================== ===================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 112 The accompanying notes are an integral part of these financial statements. 113 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
GOLDMAN SACHS MID-CAP VALUE INVESTMENT DIVISION -------------------------------------------------------------------- 2013 2012 2011 -------------------- -------------------- --------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 2,312 $ 2,932 $ 2,221 Net realized gains (losses)......................... 32,251 (683) (27,627) Change in unrealized gains (losses) on investments.. 43,303 45,178 1,030 -------------------- -------------------- --------------------- Net increase (decrease) in net assets resulting from operations................................ 77,866 47,427 (24,376) -------------------- -------------------- --------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ -- -- -- Net transfers (including fixed account)............. (24,951) -- -- Policy charges...................................... (9,102) (8,787) (9,130) Transfers for policy benefits and terminations...... (6,108) (48,734) (65,335) -------------------- -------------------- --------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (40,161) (57,521) (74,465) -------------------- -------------------- --------------------- Net increase (decrease) in net assets............. 37,705 (10,094) (98,841) NET ASSETS: Beginning of year................................... 258,154 268,248 367,089 -------------------- -------------------- --------------------- End of year......................................... $ 295,859 $ 258,154 $ 268,248 ==================== ==================== ===================== GOLDMAN SACHS STRUCTURED SMALL CAP EQUITY INVESTMENT DIVISION -------------------------------------------------------------------- 2013 2012 2011 -------------------- -------------------- --------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 373 $ 308 $ 424 Net realized gains (losses)......................... 5,748 5,427 175 Change in unrealized gains (losses) on investments.. 3,869 (629) (255) -------------------- -------------------- --------------------- Net increase (decrease) in net assets resulting from operations................................ 9,990 5,106 344 -------------------- -------------------- --------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 1,542 4,965 468 Net transfers (including fixed account)............. 6,458 (32,037) -- Policy charges...................................... (2,827) (1,976) (1,804) Transfers for policy benefits and terminations...... -- -- (1) -------------------- -------------------- --------------------- Net increase (decrease) in net assets resulting from policy transactions....................... 5,173 (29,048) (1,337) -------------------- -------------------- --------------------- Net increase (decrease) in net assets............. 15,163 (23,942) (993) NET ASSETS: Beginning of year................................... 26,317 50,259 51,252 -------------------- -------------------- --------------------- End of year......................................... $ 41,480 $ 26,317 $ 50,259 ==================== ==================== ===================== INVESCO V.I. COMSTOCK INVESTMENT DIVISION -------------------------------------------------------------------- 2013 2012 2011 --------------------- --------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 4,077 $ 3,483 $ 489 Net realized gains (losses)......................... 1,475 1,338 (127) Change in unrealized gains (losses) on investments.. 78,224 32,459 (6,181) --------------------- --------------------- -------------------- Net increase (decrease) in net assets resulting from operations................................ 83,776 37,280 (5,819) --------------------- --------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ -- 26,415 18,211 Net transfers (including fixed account)............. 165 (11,358) 148,276 Policy charges...................................... (5,972) (5,093) (2,690) Transfers for policy benefits and terminations...... -- -- -- --------------------- --------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (5,807) 9,964 163,797 --------------------- --------------------- -------------------- Net increase (decrease) in net assets............. 77,969 47,244 157,978 NET ASSETS: Beginning of year................................... 237,306 190,062 32,084 --------------------- --------------------- -------------------- End of year......................................... $ 315,275 $ 237,306 $ 190,062 ===================== ===================== ====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 114 The accompanying notes are an integral part of these financial statements. 115 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
INVESCO V.I. GLOBAL REAL ESTATE INVESTMENT DIVISION ------------------------------------------------------------------------- 2013 2012 2011 ---------------------- ---------------------- ---------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 99,799 $ 10,832 $ 72,431 Net realized gains (losses)......................... 38,480 (24,321) (158,339) Change in unrealized gains (losses) on investments.. (72,537) 481,388 (44,519) ---------------------- ---------------------- ---------------------- Net increase (decrease) in net assets resulting from operations................................ 65,742 467,899 (130,427) ---------------------- ---------------------- ---------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 82,806 92,394 18,821 Net transfers (including fixed account)............. (103,016) 676,565 131,727 Policy charges...................................... (74,590) (68,963) (66,134) Transfers for policy benefits and terminations...... -- (43,803) (60,454) ---------------------- ---------------------- ---------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (94,800) 656,193 23,960 ---------------------- ---------------------- ---------------------- Net increase (decrease) in net assets............ (29,058) 1,124,092 (106,467) NET ASSETS: Beginning of year................................... 2,614,736 1,490,644 1,597,111 ---------------------- ---------------------- ---------------------- End of year......................................... $ 2,585,678 $ 2,614,736 $ 1,490,644 ====================== ====================== ====================== INVESCO V.I. GOVERNMENT SECURITIES INVESTMENT DIVISION ------------------------------------------------------------------------- 2013 2012 2011 (f) ---------------------- ---------------------- ---------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 367 $ -- $ -- Net realized gains (losses)......................... (1) 1,308 1,389 Change in unrealized gains (losses) on investments.. (529) (1,335) 1,336 ---------------------- ---------------------- ---------------------- Net increase (decrease) in net assets resulting from operations................................ (163) (27) 2,725 ---------------------- ---------------------- ---------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 1,119 -- -- Net transfers (including fixed account)............. 9,806 (21,034) 19,885 Policy charges...................................... (57) (119) (1,119) Transfers for policy benefits and terminations...... -- -- -- ---------------------- ---------------------- ---------------------- Net increase (decrease) in net assets resulting from policy transactions....................... 10,868 (21,153) 18,766 ---------------------- ---------------------- ---------------------- Net increase (decrease) in net assets............ 10,705 (21,180) 21,491 NET ASSETS: Beginning of year................................... 311 21,491 -- ---------------------- ---------------------- ---------------------- End of year......................................... $ 11,016 $ 311 $ 21,491 ====================== ====================== ====================== INVESCO V.I. INTERNATIONAL GROWTH INVESTMENT DIVISION ------------------------------------------------------------------------- 2013 2012 2011 ---------------------- ---------------------- ---------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 4,576 $ 90,329 $ 3,660 Net realized gains (losses)......................... 926,281 18,589 3,888 Change in unrealized gains (losses) on investments.. (647,277) 685,032 (28,330) ---------------------- ---------------------- ---------------------- Net increase (decrease) in net assets resulting from operations................................ 283,580 793,950 (20,782) ---------------------- ---------------------- ---------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ -- 1,064,864 3,175 Net transfers (including fixed account)............. (6,300,567) 4,933,992 (26,489) Policy charges...................................... (60,067) (310,061) (6,987) Transfers for policy benefits and terminations...... (29,907) -- (197,921) ---------------------- ---------------------- ---------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (6,390,541) 5,688,795 (228,222) ---------------------- ---------------------- ---------------------- Net increase (decrease) in net assets............ (6,106,961) 6,482,745 (249,004) NET ASSETS: Beginning of year................................... 6,506,152 23,407 272,411 ---------------------- ---------------------- ---------------------- End of year......................................... $ 399,191 $ 6,506,152 $ 23,407 ====================== ====================== ======================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 116 The accompanying notes are an integral part of these financial statements. 117 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
JANUS ASPEN BALANCED INVESTMENT DIVISION --------------------------------------------------------------------- 2013 2012 2011 --------------------- --------------------- --------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 13,254 $ 27,163 $ 44,376 Net realized gains (losses)......................... 80,275 115,247 137,912 Change in unrealized gains (losses) on investments.. 94,265 25,664 (161,867) --------------------- --------------------- --------------------- Net increase (decrease) in net assets resulting from operations................................ 187,794 168,074 20,421 --------------------- --------------------- --------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 32,790 153,325 105,004 Net transfers (including fixed account)............. (213,385) (463,753) (679,101) Policy charges...................................... (36,051) (37,906) (57,528) Transfers for policy benefits and terminations...... (78,995) (58,979) (575,867) --------------------- --------------------- --------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (295,641) (407,313) (1,207,492) --------------------- --------------------- --------------------- Net increase (decrease) in net assets............. (107,847) (239,239) (1,187,071) NET ASSETS: Beginning of year................................... 1,100,549 1,339,788 2,526,859 --------------------- --------------------- --------------------- End of year......................................... $ 992,702 $ 1,100,549 $ 1,339,788 ===================== ===================== ===================== JANUS ASPEN FORTY INVESTMENT DIVISION --------------------------------------------------------------------- 2013 2012 2011 --------------------- --------------------- --------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 4,954 $ 5,152 $ 2,325 Net realized gains (losses)......................... 69,285 38,660 43,353 Change in unrealized gains (losses) on investments.. 155,845 126,343 (117,114) --------------------- --------------------- --------------------- Net increase (decrease) in net assets resulting from operations................................ 230,084 170,155 (71,436) --------------------- --------------------- --------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 18,835 86,108 58,591 Net transfers (including fixed account)............. (2,646) (41,907) (237,596) Policy charges...................................... (24,771) (29,645) (30,157) Transfers for policy benefits and terminations...... (239,346) -- (229,034) --------------------- --------------------- --------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (247,928) 14,556 (438,196) --------------------- --------------------- --------------------- Net increase (decrease) in net assets............. (17,844) 184,711 (509,632) NET ASSETS: Beginning of year................................... 887,847 703,136 1,212,768 --------------------- --------------------- --------------------- End of year......................................... $ 870,003 $ 887,847 $ 703,136 ===================== ===================== ===================== JANUS ASPEN JANUS INVESTMENT DIVISION --------------------------------------------------------------------- 2013 2012 2011 --------------------- --------------------- --------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 6,858 $ 5,213 $ 5,397 Net realized gains (losses)......................... 258,951 29,069 1,561,413 Change in unrealized gains (losses) on investments.. (62,054) 122,884 (1,416,036) --------------------- --------------------- --------------------- Net increase (decrease) in net assets resulting from operations................................ 203,755 157,166 150,774 --------------------- --------------------- --------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 1,427 19,037 6,403 Net transfers (including fixed account)............. (664,858) (14,200) (6,850,158) Policy charges...................................... (33,550) (41,868) (89,176) Transfers for policy benefits and terminations...... (39,166) (6,552) (191,751) --------------------- --------------------- --------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (736,147) (43,583) (7,124,682) --------------------- --------------------- --------------------- Net increase (decrease) in net assets............. (532,392) 113,583 (6,973,908) NET ASSETS: Beginning of year................................... 971,677 858,094 7,832,002 --------------------- --------------------- --------------------- End of year......................................... $ 439,285 $ 971,677 $ 858,094 ===================== ===================== =====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 118 The accompanying notes are an integral part of these financial statements. 119 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
JANUS ASPEN OVERSEAS INVESTMENT DIVISION -------------------------------------------------------------------- 2013 2012 2011 -------------------- -------------------- --------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 11,835 $ 2,519 $ 1,291 Net realized gains (losses)......................... (73,759) 36,365 (90,371) Change in unrealized gains (losses) on investments.. 113,083 8,927 (214,175) -------------------- -------------------- --------------------- Net increase (decrease) in net assets resulting from operations................................ 51,159 47,811 (303,255) -------------------- -------------------- --------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 5,947 72,495 17,337 Net transfers (including fixed account)............. (367,128) (60) 362,799 Policy charges...................................... (17,659) (20,490) (57,215) Transfers for policy benefits and terminations...... (45,425) (1,949) (51,382) -------------------- -------------------- --------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (424,265) 49,996 271,539 -------------------- -------------------- --------------------- Net increase (decrease) in net assets............. (373,106) 97,807 (31,716) NET ASSETS: Beginning of year................................... 441,942 344,135 375,851 -------------------- -------------------- --------------------- End of year......................................... $ 68,836 $ 441,942 $ 344,135 ==================== ==================== ===================== MFS VIT GLOBAL EQUITY INVESTMENT DIVISION -------------------------------------------------------------------- 2013 2012 2011 --------------------- -------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 1,253 $ 61 $ 575 Net realized gains (losses)......................... 550 428 12,787 Change in unrealized gains (losses) on investments.. 37,978 6,795 (16,173) --------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations................................ 39,781 7,284 (2,811) --------------------- -------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 1,231 2,223 10,718 Net transfers (including fixed account)............. 12,710 121,236 (180,476) Policy charges...................................... (3,432) (579) (1,554) Transfers for policy benefits and terminations...... (398) (150) (47,257) --------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... 10,111 122,730 (218,569) --------------------- -------------------- -------------------- Net increase (decrease) in net assets............. 49,892 130,014 (221,380) NET ASSETS: Beginning of year................................... 135,428 5,414 226,794 --------------------- -------------------- -------------------- End of year......................................... $ 185,320 $ 135,428 $ 5,414 ===================== ==================== ==================== MFS VIT NEW DISCOVERY INVESTMENT DIVISION ------------------------------------------------------------------- 2013 2012 2011 -------------------- -------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ -- $ -- $ -- Net realized gains (losses)......................... 3,681 16,176 18,098 Change in unrealized gains (losses) on investments.. 65,025 11,186 (32,906) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations................................ 68,706 27,362 (14,808) -------------------- -------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ -- 25,604 6,694 Net transfers (including fixed account)............. -- 1,556 5 Policy charges...................................... (5,593) (4,934) (4,419) Transfers for policy benefits and terminations...... (4,981) -- -- -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (10,574) 22,226 2,280 -------------------- -------------------- -------------------- Net increase (decrease) in net assets............. 58,132 49,588 (12,528) NET ASSETS: Beginning of year................................... 171,983 122,395 134,923 -------------------- -------------------- -------------------- End of year......................................... $ 230,115 $ 171,983 $ 122,395 ==================== ==================== ====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 120 The accompanying notes are an integral part of these financial statements. 121 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
MFS VIT VALUE INVESTMENT DIVISION -------------------------------------------------------------------- 2013 2012 2011 -------------------- -------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 197 $ 668 $ 999 Net realized gains (losses)......................... 384 3,543 (9,686) Change in unrealized gains (losses) on investments.. 5,315 2,241 6,173 -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations................................ 5,896 6,452 (2,514) -------------------- -------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ -- -- -- Net transfers (including fixed account)............. 5 -- -- Policy charges...................................... (1,361) (2,417) (2,722) Transfers for policy benefits and terminations...... -- (31,172) (29,560) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (1,356) (33,589) (32,282) -------------------- -------------------- -------------------- Net increase (decrease) in net assets............. 4,540 (27,137) (34,796) NET ASSETS: Beginning of year................................... 17,162 44,299 79,095 -------------------- -------------------- -------------------- End of year......................................... $ 21,702 $ 17,162 $ 44,299 ==================== ==================== ==================== MFS VIT II MIST ALLIANCEBERNSTEIN HIGH YIELD GLOBAL DYNAMIC ALLOCATION INVESTMENT DIVISION INVESTMENT DIVISION --------------------- -------------------------------------------- 2013 (g) 2013 2012 (h) --------------------- -------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 3,270 $ 139 $ -- Net realized gains (losses)......................... (3) 298 -- Change in unrealized gains (losses) on investments.. 2,275 1,389 163 --------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations................................ 5,542 1,826 163 --------------------- -------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 671 11,934 1,541 Net transfers (including fixed account)............. 143,861 18,582 5,907 Policy charges...................................... (713) (3,960) (513) Transfers for policy benefits and terminations...... -- (1,244) -- --------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... 143,819 25,312 6,935 --------------------- -------------------- -------------------- Net increase (decrease) in net assets............. 149,361 27,138 7,098 NET ASSETS: Beginning of year................................... -- 7,098 -- --------------------- -------------------- -------------------- End of year......................................... $ 149,361 $ 34,236 $ 7,098 ===================== ==================== ==================== MIST AMERICAN FUNDS BALANCED ALLOCATION INVESTMENT DIVISION -------------------------------------------------------------------- 2013 2012 2011 --------------------- --------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 11,592 $ 10,680 $ 6,635 Net realized gains (losses)......................... 47,865 9,312 6,294 Change in unrealized gains (losses) on investments.. 62,896 50,640 (23,258) --------------------- --------------------- -------------------- Net increase (decrease) in net assets resulting from operations................................ 122,353 70,632 (10,329) --------------------- --------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 104,324 95,603 100,111 Net transfers (including fixed account)............. (8,323) 9,483 36,239 Policy charges...................................... (50,440) (41,140) (32,003) Transfers for policy benefits and terminations...... (9,074) (19,150) (5,429) --------------------- --------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... 36,487 44,796 98,918 --------------------- --------------------- -------------------- Net increase (decrease) in net assets............. 158,840 115,428 88,589 NET ASSETS: Beginning of year................................... 631,423 515,995 427,406 --------------------- --------------------- -------------------- End of year......................................... $ 790,263 $ 631,423 $ 515,995 ===================== ===================== ====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 122 The accompanying notes are an integral part of these financial statements. 123 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
MIST AMERICAN FUNDS GROWTH ALLOCATION INVESTMENT DIVISION ---------------------------------------------------------- 2013 2012 2011 ------------------ ------------------ ------------------ INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 16,414 $ 13,384 $ 10,815 Net realized gains (losses)......................... 105,044 16,384 9,254 Change in unrealized gains (losses) on investments.. 172,370 96,877 (58,738) ------------------ ------------------ ------------------ Net increase (decrease) in net assets resulting from operations................................ 293,828 126,645 (38,669) ------------------ ------------------ ------------------ POLICY TRANSACTIONS: Premium payments received from policy owners........ 478,064 256,426 267,061 Net transfers (including fixed account)............. 77,933 39,236 31,086 Policy charges...................................... (121,468) (109,463) (124,905) Transfers for policy benefits and terminations...... (164,501) (167,111) (59,628) ------------------ ------------------ ------------------ Net increase (decrease) in net assets resulting from policy transactions....................... 270,028 19,088 113,614 ------------------ ------------------ ------------------ Net increase (decrease) in net assets............. 563,856 145,733 74,945 NET ASSETS: Beginning of year................................... 926,978 781,245 706,300 ------------------ ------------------ ------------------ End of year......................................... $ 1,490,834 $ 926,978 $ 781,245 ================== ================== ================== MIST AMERICAN FUNDS MODERATE ALLOCATION INVESTMENT DIVISION ---------------------------------------------------------- 2013 2012 2011 ------------------ ------------------ ------------------ INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 14,487 $ 10,434 $ 5,453 Net realized gains (losses)......................... 45,176 11,099 3,384 Change in unrealized gains (losses) on investments.. 36,688 29,635 (7,233) ------------------ ------------------ ------------------ Net increase (decrease) in net assets resulting from operations................................ 96,351 51,168 1,604 ------------------ ------------------ ------------------ POLICY TRANSACTIONS: Premium payments received from policy owners........ 259,807 224,194 153,402 Net transfers (including fixed account)............. 85,500 22,347 57,534 Policy charges...................................... (99,597) (81,784) (55,936) Transfers for policy benefits and terminations...... (54,826) (29,845) (5,092) ------------------ ------------------ ------------------ Net increase (decrease) in net assets resulting from policy transactions....................... 190,884 134,912 149,908 ------------------ ------------------ ------------------ Net increase (decrease) in net assets............. 287,235 186,080 151,512 NET ASSETS: Beginning of year................................... 587,686 401,606 250,094 ------------------ ------------------ ------------------ End of year......................................... $ 874,921 $ 587,686 $ 401,606 ================== ================== ================== MIST AQR GLOBAL RISK BALANCED INVESTMENT DIVISION -------------------------------------- 2013 2012 (h) ------------------ ------------------ INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 1,949 $ -- Net realized gains (losses)......................... 3,801 (28) Change in unrealized gains (losses) on investments.. (10,413) 375 ------------------ ------------------ Net increase (decrease) in net assets resulting from operations................................ (4,663) 347 ------------------ ------------------ POLICY TRANSACTIONS: Premium payments received from policy owners........ 65,813 2,706 Net transfers (including fixed account)............. 81,910 22,769 Policy charges...................................... (14,930) (1,026) Transfers for policy benefits and terminations...... -- (12) ------------------ ------------------ Net increase (decrease) in net assets resulting from policy transactions....................... 132,793 24,437 ------------------ ------------------ Net increase (decrease) in net assets............. 128,130 24,784 NET ASSETS: Beginning of year................................... 24,784 -- ------------------ ------------------ End of year......................................... $ 152,914 $ 24,784 ================== ================== MIST BLACKROCK GLOBAL TACTICAL STRATEGIES INVESTMENT DIVISION -------------------------------------- 2013 2012 (h) ------------------ ------------------ INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 951 $ -- Net realized gains (losses)......................... 1,775 51 Change in unrealized gains (losses) on investments.. 4,911 878 ------------------ ------------------ Net increase (decrease) in net assets resulting from operations................................ 7,637 929 ------------------ ------------------ POLICY TRANSACTIONS: Premium payments received from policy owners........ 28,258 5,304 Net transfers (including fixed account)............. 42,849 34,552 Policy charges...................................... (11,540) (1,705) Transfers for policy benefits and terminations...... (3,708) (2) ------------------ ------------------ Net increase (decrease) in net assets resulting from policy transactions....................... 55,859 38,149 ------------------ ------------------ Net increase (decrease) in net assets............. 63,496 39,078 NET ASSETS: Beginning of year................................... 39,078 -- ------------------ ------------------ End of year......................................... $ 102,574 $ 39,078 ================== ==================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 124 The accompanying notes are an integral part of these financial statements. 125 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
MIST BLACKROCK LARGE CAP CORE INVESTMENT DIVISION -------------------------------------------------------------------- 2013 2012 2011 --------------------- -------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 3,087,670 $ 2,105,871 $ 1,842,952 Net realized gains (losses)......................... 1,187,504 (3,353,915) (4,542,808) Change in unrealized gains (losses) on investments.. 96,008,684 38,395,441 3,050,880 --------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations................................ 100,283,858 37,147,397 351,024 --------------------- -------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 28,600,415 30,263,186 32,085,988 Net transfers (including fixed account)............. (4,051,695) (3,536,610) (2,768,320) Policy charges...................................... (25,380,973) (25,681,797) (26,055,182) Transfers for policy benefits and terminations...... (21,667,485) (22,249,090) (21,487,307) --------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (22,499,738) (21,204,311) (18,224,821) --------------------- -------------------- -------------------- Net increase (decrease) in net assets............. 77,784,120 15,943,086 (17,873,797) NET ASSETS: Beginning of year................................... 307,558,825 291,615,739 309,489,536 --------------------- -------------------- -------------------- End of year......................................... $ 385,342,945 $ 307,558,825 $ 291,615,739 ===================== ==================== ==================== MIST CLARION GLOBAL REAL ESTATE INVESTMENT DIVISION -------------------------------------------------------------------- 2013 2012 2011 -------------------- -------------------- --------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 1,852,443 $ 469,650 $ 822,247 Net realized gains (losses)......................... (121,862) (282,095) (421,589) Change in unrealized gains (losses) on investments.. (768,686) 4,988,577 (1,500,208) -------------------- -------------------- --------------------- Net increase (decrease) in net assets resulting from operations................................ 961,895 5,176,132 (1,099,550) -------------------- -------------------- --------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 2,495,640 2,592,509 2,829,699 Net transfers (including fixed account)............. 1,467,986 1,803,836 (266,335) Policy charges...................................... (1,572,434) (1,523,067) (1,472,266) Transfers for policy benefits and terminations...... (1,938,690) (1,526,479) (1,591,725) -------------------- -------------------- --------------------- Net increase (decrease) in net assets resulting from policy transactions....................... 452,502 1,346,799 (500,627) -------------------- -------------------- --------------------- Net increase (decrease) in net assets............. 1,414,397 6,522,931 (1,600,177) NET ASSETS: Beginning of year................................... 26,083,318 19,560,387 21,160,564 -------------------- -------------------- --------------------- End of year......................................... $ 27,497,715 $ 26,083,318 $ 19,560,387 ==================== ==================== ===================== MIST CLEARBRIDGE AGGRESSIVE GROWTH II INVESTMENT DIVISION ------------------------------------------------------------------- 2013 2012 2011 -------------------- --------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 110,229 $ 43,475 $ 231,367 Net realized gains (losses)......................... 518,428 176,627 2,199 Change in unrealized gains (losses) on investments.. 3,724,517 2,618,525 (1,278,619) -------------------- --------------------- -------------------- Net increase (decrease) in net assets resulting from operations................................ 4,353,174 2,838,627 (1,045,053) -------------------- --------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 1,868,762 1,848,830 2,050,382 Net transfers (including fixed account)............. (933,828) 554,060 (1,014,538) Policy charges...................................... (1,090,646) (1,037,840) (966,083) Transfers for policy benefits and terminations...... (1,088,197) (1,121,178) (795,086) -------------------- --------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (1,243,909) 243,872 (725,325) -------------------- --------------------- -------------------- Net increase (decrease) in net assets............. 3,109,265 3,082,499 (1,770,378) NET ASSETS: Beginning of year................................... 15,566,776 12,484,277 14,254,655 -------------------- --------------------- -------------------- End of year......................................... $ 18,676,041 $ 15,566,776 $ 12,484,277 ==================== ===================== ====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 126 The accompanying notes are an integral part of these financial statements. 127 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
MIST CLEARBRIDGE AGGRESSIVE GROWTH INVESTMENT DIVISION -------------------------------------------------------------------- 2013 2012 2011 -------------------- --------------------- --------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 59,517 $ 20,415 $ 2,384 Net realized gains (losses)......................... 455,065 171,678 93,448 Change in unrealized gains (losses) on investments.. 6,062,472 2,107,124 (217,464) -------------------- --------------------- --------------------- Net increase (decrease) in net assets resulting from operations................................ 6,577,054 2,299,217 (121,632) -------------------- --------------------- --------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 1,403,269 1,437,587 1,318,130 Net transfers (including fixed account)............. 1,633,069 70,510 5,034,717 Policy charges...................................... (1,055,732) (965,403) (807,741) Transfers for policy benefits and terminations...... (1,099,100) (981,320) (890,256) -------------------- --------------------- --------------------- Net increase (decrease) in net assets resulting from policy transactions....................... 881,506 (438,626) 4,654,850 -------------------- --------------------- --------------------- Net increase (decrease) in net assets............. 7,458,560 1,860,591 4,533,218 NET ASSETS: Beginning of year................................... 14,226,385 12,365,794 7,832,576 -------------------- --------------------- --------------------- End of year......................................... $ 21,684,945 $ 14,226,385 $ 12,365,794 ==================== ===================== ===================== MIST HARRIS OAKMARK INTERNATIONAL INVESTMENT DIVISION -------------------------------------------------------------------- 2013 2012 2011 --------------------- --------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 1,176,625 $ 497,722 $ (38,360) Net realized gains (losses)......................... 663,573 (140,345) (114,036) Change in unrealized gains (losses) on investments.. 9,999,502 7,474,599 (4,256,535) --------------------- --------------------- -------------------- Net increase (decrease) in net assets resulting from operations................................ 11,839,700 7,831,976 (4,408,931) --------------------- --------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 3,906,251 3,418,984 3,837,373 Net transfers (including fixed account)............. 8,505,167 (782,470) 133,438 Policy charges...................................... (2,400,727) (1,876,193) (1,940,266) Transfers for policy benefits and terminations...... (2,622,312) (2,206,344) (1,949,570) --------------------- --------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... 7,388,379 (1,446,023) 80,975 --------------------- --------------------- -------------------- Net increase (decrease) in net assets............. 19,228,079 6,385,953 (4,327,956) NET ASSETS: Beginning of year................................... 33,602,695 27,216,742 31,544,698 --------------------- --------------------- -------------------- End of year......................................... $ 52,830,774 $ 33,602,695 $ 27,216,742 ===================== ===================== ==================== MIST INVESCO BALANCED-RISK ALLOCATION INVESTMENT DIVISION -------------------------------------------- 2013 2012 (h) -------------------- --------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ -- $ 23 Net realized gains (losses)......................... 126 83 Change in unrealized gains (losses) on investments.. 124 (2) -------------------- --------------------- Net increase (decrease) in net assets resulting from operations................................ 250 104 -------------------- --------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 17,879 1,603 Net transfers (including fixed account)............. 4,168 6,312 Policy charges...................................... (4,070) (506) Transfers for policy benefits and terminations...... (1,017) -- -------------------- --------------------- Net increase (decrease) in net assets resulting from policy transactions....................... 16,960 7,409 -------------------- --------------------- Net increase (decrease) in net assets............. 17,210 7,513 NET ASSETS: Beginning of year................................... 7,513 -- -------------------- --------------------- End of year......................................... $ 24,723 $ 7,513 ==================== =====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 128 The accompanying notes are an integral part of these financial statements. 129 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
MIST INVESCO MID CAP VALUE INVESTMENT DIVISION -------------------------------------------------------------------- 2013 2012 2011 -------------------- -------------------- --------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 678,832 $ (48,839) $ 603 Net realized gains (losses)......................... 935,109 (82,924) 818 Change in unrealized gains (losses) on investments.. 20,593,687 2,481,449 (5,510) -------------------- -------------------- --------------------- Net increase (decrease) in net assets resulting from operations................................ 22,207,628 2,349,686 (4,089) -------------------- -------------------- --------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 6,808,802 4,895,051 5,506 Net transfers (including fixed account)............. (1,553,954) 74,538,068 11,792 Policy charges...................................... (5,171,329) (3,428,791) (3,541) Transfers for policy benefits and terminations...... (5,053,458) (3,581,952) -- -------------------- -------------------- --------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (4,969,939) 72,422,376 13,757 -------------------- -------------------- --------------------- Net increase (decrease) in net assets............. 17,237,689 74,772,062 9,668 NET ASSETS: Beginning of year................................... 74,892,920 120,858 111,190 -------------------- -------------------- --------------------- End of year......................................... $ 92,130,609 $ 74,892,920 $ 120,858 ==================== ==================== ===================== MIST INVESCO SMALL CAP GROWTH INVESTMENT DIVISION -------------------------------------------------------------------- 2013 2012 2011 --------------------- -------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 15,232 $ (5,823) $ (5,378) Net realized gains (losses)......................... 569,238 428,171 169,309 Change in unrealized gains (losses) on investments.. 1,365,097 331,488 (192,641) --------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations................................ 1,949,567 753,836 (28,710) --------------------- -------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 455,209 443,063 453,004 Net transfers (including fixed account)............. 194,761 (437,534) 42,346 Policy charges...................................... (291,728) (265,168) (262,281) Transfers for policy benefits and terminations...... (311,249) (290,496) (261,290) --------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... 46,993 (550,135) (28,221) --------------------- -------------------- -------------------- Net increase (decrease) in net assets............. 1,996,560 203,701 (56,931) NET ASSETS: Beginning of year................................... 4,616,668 4,412,967 4,469,898 --------------------- -------------------- -------------------- End of year......................................... $ 6,613,228 $ 4,616,668 $ 4,412,967 ===================== ==================== ==================== MIST JPMORGAN GLOBAL ACTIVE ALLOCATION INVESTMENT DIVISION -------------------------------------------- 2013 2012 (h) -------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 54 $ 68 Net realized gains (losses)......................... (274) 107 Change in unrealized gains (losses) on investments.. 5,829 152 -------------------- -------------------- Net increase (decrease) in net assets resulting from operations................................ 5,609 327 -------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 18,212 1,977 Net transfers (including fixed account)............. 80,614 17,364 Policy charges...................................... (12,825) (785) Transfers for policy benefits and terminations...... (80) -- -------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... 85,921 18,556 -------------------- -------------------- Net increase (decrease) in net assets............. 91,530 18,883 NET ASSETS: Beginning of year................................... 18,883 -- -------------------- -------------------- End of year......................................... $ 110,413 $ 18,883 ==================== ====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 130 The accompanying notes are an integral part of these financial statements. 131 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
MIST JPMORGAN SMALL CAP VALUE INVESTMENT DIVISION ------------------------------------------------------------------- 2013 2012 2011 -------------------- -------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 337 $ 358 $ 472 Net realized gains (losses)......................... 2,408 3,130 1,124 Change in unrealized gains (losses) on investments.. 28,817 1,696 (4,058) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations................................ 31,562 5,184 (2,462) -------------------- -------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 14,812 11,572 8,977 Net transfers (including fixed account)............. 181,255 (1,795) 6,064 Policy charges...................................... (9,533) (6,279) (4,130) Transfers for policy benefits and terminations...... (1,850) (6,067) -- -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... 184,684 (2,569) 10,911 -------------------- -------------------- -------------------- Net increase (decrease) in net assets............. 216,246 2,615 8,449 NET ASSETS: Beginning of year................................... 38,553 35,938 27,489 -------------------- -------------------- -------------------- End of year......................................... $ 254,799 $ 38,553 $ 35,938 ==================== ==================== ==================== MIST LOOMIS SAYLES GLOBAL MARKETS INVESTMENT DIVISION -------------------- 2013 (e) -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ -- Net realized gains (losses)......................... 705 Change in unrealized gains (losses) on investments.. 43,104 -------------------- Net increase (decrease) in net assets resulting from operations................................ 43,809 -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 33,048 Net transfers (including fixed account)............. 369,498 Policy charges...................................... (21,387) Transfers for policy benefits and terminations...... (6,708) -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... 374,451 -------------------- Net increase (decrease) in net assets............. 418,260 NET ASSETS: Beginning of year................................... -- -------------------- End of year......................................... $ 418,260 ==================== MIST LORD ABBETT BOND DEBENTURE INVESTMENT DIVISION ------------------------------------------------------------------ 2013 2012 2011 -------------------- -------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 1,902,403 $ 1,923,060 $ 1,509,115 Net realized gains (losses)......................... 299,375 218,347 583,376 Change in unrealized gains (losses) on investments.. (7,269) 1,167,280 (863,576) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations................................ 2,194,509 3,308,687 1,228,915 -------------------- -------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 2,130,805 2,367,942 2,158,065 Net transfers (including fixed account)............. (494,009) 308,984 (2,168,860) Policy charges...................................... (1,625,126) (1,678,880) (1,640,766) Transfers for policy benefits and terminations...... (1,597,160) (1,522,631) (1,520,091) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (1,585,490) (524,585) (3,171,652) -------------------- -------------------- -------------------- Net increase (decrease) in net assets............. 609,019 2,784,102 (1,942,737) NET ASSETS: Beginning of year................................... 28,515,095 25,730,993 27,673,730 -------------------- -------------------- -------------------- End of year......................................... $ 29,124,114 $ 28,515,095 $ 25,730,993 ==================== ==================== ==================== MIST MET/TEMPLETON INTERNATIONAL BOND INVESTMENT DIVISION ------------------------------------------- 2013 2012 (h) -------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 302 $ -- Net realized gains (losses)......................... 37 21 Change in unrealized gains (losses) on investments.. 996 47 -------------------- -------------------- Net increase (decrease) in net assets resulting from operations................................ 1,335 68 -------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 23,432 772 Net transfers (including fixed account)............. 64,543 2,031 Policy charges...................................... (4,909) (254) Transfers for policy benefits and terminations...... (230) (12) -------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... 82,836 2,537 -------------------- -------------------- Net increase (decrease) in net assets............. 84,171 2,605 NET ASSETS: Beginning of year................................... 2,605 -- -------------------- -------------------- End of year......................................... $ 86,776 $ 2,605 ==================== ====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 132 The accompanying notes are an integral part of these financial statements. 133 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
MIST METLIFE AGGRESSIVE STRATEGY INVESTMENT DIVISION ------------------------------------------------------------- 2013 2012 2011 (f) ------------------- ------------------- ------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 144,757 $ 106,199 $ (8,047) Net realized gains (losses)......................... 243,289 (55,023) (117,896) Change in unrealized gains (losses) on investments.. 4,045,633 2,084,613 (1,834,063) ------------------- ------------------- ------------------- Net increase (decrease) in net assets resulting from operations................................ 4,433,679 2,135,789 (1,960,006) ------------------- ------------------- ------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 2,268,937 2,523,168 1,640,701 Net transfers (including fixed account)............. 149,509 (222,009) 14,330,838 Policy charges...................................... (1,056,742) (1,016,618) (680,441) Transfers for policy benefits and terminations...... (1,666,527) (750,395) (858,431) ------------------- ------------------- ------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (304,823) 534,146 14,432,667 ------------------- ------------------- ------------------- Net increase (decrease) in net assets............ 4,128,856 2,669,935 12,472,661 NET ASSETS: Beginning of year................................... 15,142,596 12,472,661 -- ------------------- ------------------- ------------------- End of year......................................... $ 19,271,452 $ 15,142,596 $ 12,472,661 =================== =================== =================== MIST METLIFE MIST METLIFE BALANCED PLUS GROWTH STRATEGY INVESTMENT DIVISION INVESTMENT DIVISION --------------------------------------- -------------------- 2013 2012 (h) 2013 (e) ------------------ ------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 778 $ -- $ -- Net realized gains (losses)......................... 3,942 119 2,973 Change in unrealized gains (losses) on investments.. 4,689 1,691 51,429 ------------------ ------------------- -------------------- Net increase (decrease) in net assets resulting from operations................................ 9,409 1,810 54,402 ------------------ ------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 19,018 2,506 16,570 Net transfers (including fixed account)............. 28,730 42,755 336,406 Policy charges...................................... (8,924) (1,138) (8,172) Transfers for policy benefits and terminations...... -- -- (16,444) ------------------ ------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... 38,824 44,123 328,360 ------------------ ------------------- -------------------- Net increase (decrease) in net assets............ 48,233 45,933 382,762 NET ASSETS: Beginning of year................................... 45,933 -- -- ------------------ ------------------- -------------------- End of year......................................... $ 94,166 $ 45,933 $ 382,762 ================== =================== ==================== MIST METLIFE MULTI-INDEX TARGETED RISK INVESTMENT DIVISION ------------------- 2013 (e) ------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 6 Net realized gains (losses)......................... (194) Change in unrealized gains (losses) on investments.. 52 ------------------- Net increase (decrease) in net assets resulting from operations................................ (136) ------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 1,546 Net transfers (including fixed account)............. 1,810 Policy charges...................................... (541) Transfers for policy benefits and terminations...... -- ------------------- Net increase (decrease) in net assets resulting from policy transactions....................... 2,815 ------------------- Net increase (decrease) in net assets............ 2,679 NET ASSETS: Beginning of year................................... -- ------------------- End of year......................................... $ 2,679 =================== MIST MFS EMERGING MARKETS EQUITY INVESTMENT DIVISION ------------------------------------------------------------- 2013 2012 2011 (f) ------------------- ------------------- ------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 1,482 $ 1,167 $ -- Net realized gains (losses)......................... 254 (1,470) (70) Change in unrealized gains (losses) on investments.. (3,821) 9,361 (3,209) ------------------- ------------------- ------------------- Net increase (decrease) in net assets resulting from operations................................ (2,085) 9,058 (3,279) ------------------- ------------------- ------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 65,858 18,431 3,938 Net transfers (including fixed account)............. 138,765 46,229 23,265 Policy charges...................................... (16,190) (6,816) (911) Transfers for policy benefits and terminations...... (2,469) (895) (63) ------------------- ------------------- ------------------- Net increase (decrease) in net assets resulting from policy transactions....................... 185,964 56,949 26,229 ------------------- ------------------- ------------------- Net increase (decrease) in net assets............ 183,879 66,007 22,950 NET ASSETS: Beginning of year................................... 88,957 22,950 -- ------------------- ------------------- ------------------- End of year......................................... $ 272,836 $ 88,957 $ 22,950 =================== =================== ===================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 134 The accompanying notes are an integral part of these financial statements. 135 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
MIST MFS RESEARCH INTERNATIONAL INVESTMENT DIVISION ------------------------------------------------------------------ 2013 2012 2011 -------------------- -------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 457,179 $ 266,180 $ 267,989 Net realized gains (losses)......................... 48,641 (345,224) (233,782) Change in unrealized gains (losses) on investments.. 2,877,942 2,185,121 (1,480,693) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations................................ 3,383,762 2,106,077 (1,446,486) -------------------- -------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 1,318,727 1,458,020 1,640,050 Net transfers (including fixed account)............. 2,955,311 1,660,976 51,977 Policy charges...................................... (920,553) (839,930) (858,974) Transfers for policy benefits and terminations...... (1,090,319) (841,229) (1,130,486) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... 2,263,166 1,437,837 (297,433) -------------------- -------------------- -------------------- Net increase (decrease) in net assets............. 5,646,928 3,543,914 (1,743,919) NET ASSETS: Beginning of year................................... 15,720,813 12,176,899 13,920,818 -------------------- -------------------- -------------------- End of year......................................... $ 21,367,741 $ 15,720,813 $ 12,176,899 ==================== ==================== ==================== MIST MORGAN STANLEY MID CAP GROWTH INVESTMENT DIVISION ------------------------------------------------------------------ 2013 2012 2011 -------------------- -------------------- ------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 1,032,581 $ (579,825) $ 866,726 Net realized gains (losses)......................... 3,781,941 1,677,793 7,856,152 Change in unrealized gains (losses) on investments.. 65,460,998 15,368,250 (21,552,444) -------------------- -------------------- ------------------- Net increase (decrease) in net assets resulting from operations................................ 70,275,520 16,466,218 (12,829,566) -------------------- -------------------- ------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 19,642,966 21,032,275 22,486,193 Net transfers (including fixed account)............. (3,859,066) (1,255,442) (4,111,245) Policy charges...................................... (14,305,433) (14,401,148) (15,255,941) Transfers for policy benefits and terminations...... (13,831,139) (13,701,209) (15,693,955) -------------------- -------------------- ------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (12,352,672) (8,325,524) (12,574,948) -------------------- -------------------- ------------------- Net increase (decrease) in net assets............. 57,922,848 8,140,694 (25,404,514) NET ASSETS: Beginning of year................................... 186,491,111 178,350,417 203,754,931 -------------------- -------------------- ------------------- End of year......................................... $ 244,413,959 $ 186,491,111 $ 178,350,417 ==================== ==================== =================== MIST OPPENHEIMER GLOBAL EQUITY INVESTMENT DIVISION ------------------------------------------------------------------ 2013 2012 2011 ------------------- ------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 847,938 $ 530,726 $ 719,512 Net realized gains (losses)......................... 1,128,194 700,180 892,248 Change in unrealized gains (losses) on investments.. 9,078,535 6,406,670 (5,213,727) ------------------- ------------------- -------------------- Net increase (decrease) in net assets resulting from operations................................ 11,054,667 7,637,576 (3,601,967) ------------------- ------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 3,161,117 3,535,071 3,587,418 Net transfers (including fixed account)............. (609,502) (1,749,487) (166,778) Policy charges...................................... (2,431,800) (2,384,677) (2,520,905) Transfers for policy benefits and terminations...... (2,535,936) (2,687,363) (3,507,119) ------------------- ------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (2,416,121) (3,286,456) (2,607,384) ------------------- ------------------- -------------------- Net increase (decrease) in net assets............. 8,638,546 4,351,120 (6,209,351) NET ASSETS: Beginning of year................................... 41,848,339 37,497,219 43,706,570 ------------------- ------------------- -------------------- End of year......................................... $ 50,486,885 $ 41,848,339 $ 37,497,219 =================== =================== ====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 136 The accompanying notes are an integral part of these financial statements. 137 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
MIST PIMCO INFLATION PROTECTED BOND INVESTMENT DIVISION ------------------------------------------------------------------ 2013 2012 2011 -------------------- -------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 276,844 $ 369,500 $ 146,996 Net realized gains (losses)......................... 545,242 800,878 525,047 Change in unrealized gains (losses) on investments.. (2,018,492) (101,684) 331,187 -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations................................ (1,196,406) 1,068,694 1,003,230 -------------------- -------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 1,300,352 1,385,490 1,244,015 Net transfers (including fixed account)............. (1,029,716) 2,478,586 671,186 Policy charges...................................... (806,882) (865,472) (683,641) Transfers for policy benefits and terminations...... (725,408) (915,239) (527,827) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (1,261,654) 2,083,365 703,733 -------------------- -------------------- -------------------- Net increase (decrease) in net assets............. (2,458,060) 3,152,059 1,706,963 NET ASSETS: Beginning of year................................... 13,671,560 10,519,501 8,812,538 -------------------- -------------------- -------------------- End of year......................................... $ 11,213,500 $ 13,671,560 $ 10,519,501 ==================== ==================== ==================== MIST PIMCO TOTAL RETURN INVESTMENT DIVISION ------------------------------------------------------------------ 2013 2012 2011 ------------------- -------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 2,109,672 $ 1,570,173 $ 1,281,730 Net realized gains (losses)......................... 1,082,946 347,234 1,634,121 Change in unrealized gains (losses) on investments.. (4,155,495) 2,519,869 (1,410,547) ------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations................................ (962,877) 4,437,276 1,505,304 ------------------- -------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 4,702,504 4,797,851 5,110,970 Net transfers (including fixed account)............. 3,443,762 1,382,335 1,024,517 Policy charges...................................... (3,408,964) (3,598,862) (3,416,996) Transfers for policy benefits and terminations...... (4,297,571) (3,664,586) (3,694,178) ------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... 439,731 (1,083,262) (975,687) ------------------- -------------------- -------------------- Net increase (decrease) in net assets............. (523,146) 3,354,014 529,617 NET ASSETS: Beginning of year................................... 50,485,893 47,131,879 46,602,262 ------------------- -------------------- -------------------- End of year......................................... $ 49,962,747 $ 50,485,893 $ 47,131,879 =================== ==================== ==================== MIST PIONEER FUND INVESTMENT DIVISION ------------------------------------------------------------------ 2013 2012 2011 -------------------- -------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 6,252 $ 2,902 $ 2,289 Net realized gains (losses)......................... 17,551 1,266 21,102 Change in unrealized gains (losses) on investments.. 32,389 14,560 (30,602) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations................................ 56,192 18,728 (7,211) -------------------- -------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 1,433 4,118 5,551 Net transfers (including fixed account)............. (14,658) 15 (1,284) Policy charges...................................... (3,841) (4,551) (4,647) Transfers for policy benefits and terminations...... (29,228) -- (61,915) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (46,294) (418) (62,295) -------------------- -------------------- -------------------- Net increase (decrease) in net assets............. 9,898 18,310 (69,506) NET ASSETS: Beginning of year................................... 194,664 176,354 245,860 -------------------- -------------------- -------------------- End of year......................................... $ 204,562 $ 194,664 $ 176,354 ==================== ==================== ====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 138 The accompanying notes are an integral part of these financial statements. 139 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
MIST PYRAMIS MANAGED RISK MIST SCHRODERS GLOBAL MULTI-ASSET INVESTMENT DIVISION INVESTMENT DIVISION -------------------- ------------------------------------------- 2013 (e) 2013 2012 (h) -------------------- -------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 2 $ 1 $ 42 Net realized gains (losses)......................... 5 187 103 Change in unrealized gains (losses) on investments.. 6 1,498 (23) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations................................ 13 1,686 122 -------------------- -------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 376 6,592 792 Net transfers (including fixed account)............. 48 11,865 5,247 Policy charges...................................... (139) (3,230) (409) Transfers for policy benefits and terminations...... -- -- -- -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... 285 15,227 5,630 -------------------- -------------------- -------------------- Net increase (decrease) in net assets............. 298 16,913 5,752 NET ASSETS: Beginning of year................................... -- 5,752 -- -------------------- -------------------- -------------------- End of year......................................... $ 298 $ 22,665 $ 5,752 ==================== ==================== ==================== MIST SSGA GROWTH AND INCOME ETF INVESTMENT DIVISION ------------------------------------------------------------------ 2013 2012 2011 -------------------- -------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 177,538 $ 126,210 $ 67,326 Net realized gains (losses)......................... 250,766 168,614 123,633 Change in unrealized gains (losses) on investments.. 431,610 365,606 (151,325) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations................................ 859,914 660,430 39,634 -------------------- -------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 862,220 646,514 610,076 Net transfers (including fixed account)............. 630,532 942,683 653,921 Policy charges...................................... (442,367) (351,822) (275,433) Transfers for policy benefits and terminations...... (250,215) (341,292) (235,978) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... 800,170 896,083 752,586 -------------------- -------------------- -------------------- Net increase (decrease) in net assets............. 1,660,084 1,556,513 792,220 NET ASSETS: Beginning of year................................... 6,167,640 4,611,127 3,818,907 -------------------- -------------------- -------------------- End of year......................................... $ 7,827,724 $ 6,167,640 $ 4,611,127 ==================== ==================== ==================== MIST SSGA GROWTH ETF INVESTMENT DIVISION ------------------------------------------------------------------ 2013 2012 2011 -------------------- -------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 102,918 $ 74,518 $ 52,353 Net realized gains (losses)......................... 255,766 177,699 63,035 Change in unrealized gains (losses) on investments.. 467,150 279,360 (183,850) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations................................ 825,834 531,577 (68,462) -------------------- -------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 588,590 510,609 473,918 Net transfers (including fixed account)............. 627,263 331,103 671,574 Policy charges...................................... (282,734) (237,442) (208,531) Transfers for policy benefits and terminations...... (433,221) (200,877) (238,362) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... 499,898 403,393 698,599 -------------------- -------------------- -------------------- Net increase (decrease) in net assets............. 1,325,732 934,970 630,137 NET ASSETS: Beginning of year................................... 4,244,488 3,309,518 2,679,381 -------------------- -------------------- -------------------- End of year......................................... $ 5,570,220 $ 4,244,488 $ 3,309,518 ==================== ==================== ====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 140 The accompanying notes are an integral part of these financial statements. 141 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
MIST T. ROWE PRICE LARGE CAP VALUE INVESTMENT DIVISION -------------------------------------------------------------------- 2013 2012 2011 -------------------- -------------------- --------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 30,041 $ 19,582 $ 9,481 Net realized gains (losses)......................... 22,312 (1,403) (435,260) Change in unrealized gains (losses) on investments.. 456,298 181,043 577,510 -------------------- -------------------- --------------------- Net increase (decrease) in net assets resulting from operations................................ 508,651 199,222 151,731 -------------------- -------------------- --------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 7,454 7,131 4,938 Net transfers (including fixed account)............. 326,923 49,898 (4,150,820) Policy charges...................................... (25,078) (17,285) (46,340) Transfers for policy benefits and terminations...... (112,478) (5) (1,102,016) -------------------- -------------------- --------------------- Net increase (decrease) in net assets resulting from policy transactions....................... 196,821 39,739 (5,294,238) -------------------- -------------------- --------------------- Net increase (decrease) in net assets............. 705,472 238,961 (5,142,507) NET ASSETS: Beginning of year................................... 1,320,515 1,081,554 6,224,061 -------------------- -------------------- --------------------- End of year......................................... $ 2,025,987 $ 1,320,515 $ 1,081,554 ==================== ==================== ===================== MIST T. ROWE PRICE MID CAP GROWTH INVESTMENT DIVISION -------------------------------------------------------------------- 2013 2012 2011 --------------------- -------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 65,404 $ (29,751) $ (30,563) Net realized gains (losses)......................... 1,831,913 2,629,009 872,771 Change in unrealized gains (losses) on investments.. 5,764,932 206,878 (1,837,318) --------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations................................ 7,662,249 2,806,136 (995,110) --------------------- -------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 1,926,999 1,915,712 2,194,867 Net transfers (including fixed account)............. 205,058 (5,662,939) 5,978,566 Policy charges...................................... (1,381,598) (1,349,872) (1,564,864) Transfers for policy benefits and terminations...... (1,809,707) (1,768,009) (1,643,740) --------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (1,059,248) (6,865,108) 4,964,829 --------------------- -------------------- -------------------- Net increase (decrease) in net assets............. 6,603,001 (4,058,972) 3,969,719 NET ASSETS: Beginning of year................................... 21,145,655 25,204,627 21,234,908 --------------------- -------------------- -------------------- End of year......................................... $ 27,748,656 $ 21,145,655 $ 25,204,627 ===================== ==================== ==================== MIST THIRD AVENUE SMALL CAP VALUE INVESTMENT DIVISION ------------------------------------------------------------------- 2013 2012 2011 -------------------- -------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 9,744 $ -- $ 9,414 Net realized gains (losses)......................... 47,240 12,071 86,881 Change in unrealized gains (losses) on investments.. 199,123 129,525 (240,493) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations................................ 256,107 141,596 (144,198) -------------------- -------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 18,262 66,068 28,968 Net transfers (including fixed account)............. (70,109) (58,431) (400,494) Policy charges...................................... (22,081) (25,818) (28,620) Transfers for policy benefits and terminations...... (106,096) (47,729) (225,194) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (180,024) (65,910) (625,340) -------------------- -------------------- -------------------- Net increase (decrease) in net assets............. 76,083 75,686 (769,538) NET ASSETS: Beginning of year................................... 881,737 806,051 1,575,589 -------------------- -------------------- -------------------- End of year......................................... $ 957,820 $ 881,737 $ 806,051 ==================== ==================== ====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 142 The accompanying notes are an integral part of these financial statements. 143 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
MSF BAILLIE GIFFORD INTERNATIONAL STOCK INVESTMENT DIVISION -------------------------------------------------------------------- 2013 2012 2011 -------------------- -------------------- --------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 476,439 $ 341,410 $ 546,449 Net realized gains (losses)......................... (474,270) (1,190,404) (808,593) Change in unrealized gains (losses) on investments.. 5,921,616 7,502,480 (8,900,342) -------------------- -------------------- --------------------- Net increase (decrease) in net assets resulting from operations................................ 5,923,785 6,653,486 (9,162,486) -------------------- -------------------- --------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 4,172,944 4,637,990 4,892,915 Net transfers (including fixed account)............. (82,846) (1,376,713) 100,755 Policy charges...................................... (2,853,344) (2,907,524) (3,147,651) Transfers for policy benefits and terminations...... (2,703,864) (2,527,135) (2,530,848) -------------------- -------------------- --------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (1,467,110) (2,173,382) (684,829) -------------------- -------------------- --------------------- Net increase (decrease) in net assets............. 4,456,675 4,480,104 (9,847,315) NET ASSETS: Beginning of year................................... 40,399,665 35,919,561 45,766,876 -------------------- -------------------- --------------------- End of year......................................... $ 44,856,340 $ 40,399,665 $ 35,919,561 ==================== ==================== ===================== MSF BARCLAYS AGGREGATE BOND INDEX INVESTMENT DIVISION -------------------------------------------------------------------- 2013 2012 2011 -------------------- -------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 4,070,313 $ 4,231,088 $ 3,875,815 Net realized gains (losses)......................... 125,172 604,720 843,640 Change in unrealized gains (losses) on investments.. (6,977,167) (447,969) 3,276,276 -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations................................ (2,781,682) 4,387,839 7,995,731 -------------------- -------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 11,646,001 12,468,986 12,546,475 Net transfers (including fixed account)............. 11,038,720 7,067,547 (5,035,008) Policy charges...................................... (8,147,262) (8,609,472) (8,528,408) Transfers for policy benefits and terminations...... (6,747,468) (7,662,930) (12,699,958) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... 7,789,991 3,264,131 (13,716,899) -------------------- -------------------- -------------------- Net increase (decrease) in net assets............. 5,008,309 7,651,970 (5,721,168) NET ASSETS: Beginning of year................................... 116,415,557 108,763,587 114,484,755 -------------------- -------------------- -------------------- End of year......................................... $ 121,423,866 $ 116,415,557 $ 108,763,587 ==================== ==================== ==================== MSF BLACKROCK BOND INCOME INVESTMENT DIVISION -------------------------------------------------------------------- 2013 2012 2011 --------------------- --------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 2,989,203 $ 1,971,467 $ 2,986,399 Net realized gains (losses)......................... 2,148,415 905,570 132,024 Change in unrealized gains (losses) on investments.. (6,076,619) 2,995,775 1,930,533 --------------------- --------------------- -------------------- Net increase (decrease) in net assets resulting from operations................................ (939,001) 5,872,812 5,048,956 --------------------- --------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 7,196,561 7,520,502 7,828,777 Net transfers (including fixed account)............. 376,688 238,363 (1,265,327) Policy charges...................................... (5,905,721) (6,492,283) (6,574,083) Transfers for policy benefits and terminations...... (4,992,049) (5,691,274) (5,835,954) --------------------- --------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (3,324,521) (4,424,692) (5,846,587) --------------------- --------------------- -------------------- Net increase (decrease) in net assets............. (4,263,522) 1,448,120 (797,631) NET ASSETS: Beginning of year................................... 85,513,325 84,065,205 84,862,836 --------------------- --------------------- -------------------- End of year......................................... $ 81,249,803 $ 85,513,325 $ 84,065,205 ===================== ===================== ====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 144 The accompanying notes are an integral part of these financial statements. 145 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
MSF BLACKROCK CAPITAL APPRECIATION INVESTMENT DIVISION ------------------------------------------------------------------- 2013 2012 2011 -------------------- --------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 135,824 $ 33,557 $ 6,652 Net realized gains (losses)......................... 321,200 261,278 137,813 Change in unrealized gains (losses) on investments.. 4,769,715 1,344,869 (879,158) -------------------- --------------------- -------------------- Net increase (decrease) in net assets resulting from operations................................ 5,226,739 1,639,704 (734,693) -------------------- --------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 1,539,986 2,048,562 1,133,989 Net transfers (including fixed account)............. 1,984,291 4,185,125 1,403,176 Policy charges...................................... (888,848) (887,196) (567,701) Transfers for policy benefits and terminations...... (994,087) (341,906) (1,189,484) -------------------- --------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... 1,641,342 5,004,585 779,980 -------------------- --------------------- -------------------- Net increase (decrease) in net assets............. 6,868,081 6,644,289 45,287 NET ASSETS: Beginning of year................................... 14,012,099 7,367,810 7,322,523 -------------------- --------------------- -------------------- End of year......................................... $ 20,880,180 $ 14,012,099 $ 7,367,810 ==================== ===================== ==================== MSF BLACKROCK DIVERSIFIED INVESTMENT DIVISION ------------------------------------------------------------------- 2013 2012 2011 -------------------- -------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 5,446,288 $ 4,600,384 $ 4,934,321 Net realized gains (losses)......................... 2,747,913 1,094,116 (191,522) Change in unrealized gains (losses) on investments.. 43,444,585 23,691,349 3,658,514 -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations................................ 51,638,786 29,385,849 8,401,313 -------------------- -------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 24,527,235 26,242,636 27,879,758 Net transfers (including fixed account)............. (283,654) (1,486,565) (878,239) Policy charges...................................... (22,861,275) (23,779,226) (23,910,845) Transfers for policy benefits and terminations...... (17,190,722) (18,935,103) (19,040,111) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (15,808,416) (17,958,258) (15,949,437) -------------------- -------------------- -------------------- Net increase (decrease) in net assets............. 35,830,370 11,427,591 (7,548,124) NET ASSETS: Beginning of year................................... 266,981,783 255,554,192 263,102,316 -------------------- -------------------- -------------------- End of year......................................... $ 302,812,153 $ 266,981,783 $ 255,554,192 ==================== ==================== ==================== MSF BLACKROCK LARGE CAP VALUE INVESTMENT DIVISION ------------------------------------------------------------------- 2013 2012 2011 -------------------- -------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 205,780 $ 209,379 $ 129,733 Net realized gains (losses)......................... 916,715 2,007,312 (80,782) Change in unrealized gains (losses) on investments.. 3,399,848 (358,711) 254,349 -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations................................ 4,522,343 1,857,980 303,300 -------------------- -------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 1,703,921 1,824,774 1,997,147 Net transfers (including fixed account)............. 136,294 (541,800) 22,211 Policy charges...................................... (1,017,256) (986,361) (953,175) Transfers for policy benefits and terminations...... (1,178,677) (1,176,695) (955,568) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (355,718) (880,082) 110,615 -------------------- -------------------- -------------------- Net increase (decrease) in net assets............. 4,166,625 977,898 413,915 NET ASSETS: Beginning of year................................... 14,290,950 13,313,052 12,899,137 -------------------- -------------------- -------------------- End of year......................................... $ 18,457,575 $ 14,290,950 $ 13,313,052 ==================== ==================== ====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 146 The accompanying notes are an integral part of these financial statements. 147 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
MSF BLACKROCK MONEY MARKET INVESTMENT DIVISION ------------------------------------------------------------------ 2013 2012 2011 -------------------- -------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ (45,649) $ (48,731) $ (47,046) Net realized gains (losses)......................... -- -- -- Change in unrealized gains (losses) on investments.. -- -- -- -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations................................ (45,649) (48,731) (47,046) -------------------- -------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 3,313,077 1,122,876 6,905,158 Net transfers (including fixed account)............. 981,039 4,792,952 (10,656,392) Policy charges...................................... (1,064,647) (709,203) (1,223,525) Transfers for policy benefits and terminations...... (2,676,395) (2,666,648) (4,013,323) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... 553,074 2,539,977 (8,988,082) -------------------- -------------------- -------------------- Net increase (decrease) in net assets............. 507,425 2,491,246 (9,035,128) NET ASSETS: Beginning of year................................... 23,274,454 20,783,208 29,818,336 -------------------- -------------------- -------------------- End of year......................................... $ 23,781,879 $ 23,274,454 $ 20,783,208 ==================== ==================== ==================== MSF DAVIS VENTURE VALUE INVESTMENT DIVISION ------------------------------------------------------------------ 2013 2012 2011 -------------------- -------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 855,040 $ 426,207 $ 594,738 Net realized gains (losses)......................... 2,782,148 549,533 492,146 Change in unrealized gains (losses) on investments.. 15,346,828 5,763,493 (3,392,027) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations................................ 18,984,016 6,739,233 (2,305,143) -------------------- -------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 5,941,838 6,480,032 7,273,891 Net transfers (including fixed account)............. (2,306,865) (813,439) 33,336 Policy charges...................................... (3,965,087) (3,889,505) (4,125,791) Transfers for policy benefits and terminations...... (4,143,551) (3,947,761) (5,136,119) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (4,473,665) (2,170,673) (1,954,683) -------------------- -------------------- -------------------- Net increase (decrease) in net assets............. 14,510,351 4,568,560 (4,259,826) NET ASSETS: Beginning of year................................... 58,219,352 53,650,792 57,910,618 -------------------- -------------------- -------------------- End of year......................................... $ 72,729,703 $ 58,219,352 $ 53,650,792 ==================== ==================== ==================== MSF FRONTIER MID CAP GROWTH INVESTMENT DIVISION ------------------------------------------------------------------ 2013 2012 2011 ------------------- -------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 1,219,986 $ (1,258,555) $ (701,469) Net realized gains (losses)......................... 10,646,811 2,892,428 2,544,325 Change in unrealized gains (losses) on investments.. 45,562,137 17,096,166 (8,863,059) ------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations................................ 57,428,934 18,730,039 (7,020,203) ------------------- -------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 15,025,336 17,178,798 17,102,384 Net transfers (including fixed account)............. (9,140,683) (3,218,712) 3,214,026 Policy charges...................................... (13,251,775) (13,834,330) (14,177,756) Transfers for policy benefits and terminations...... (12,787,266) (13,147,114) (14,269,181) ------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (20,154,388) (13,021,358) (8,130,527) ------------------- -------------------- -------------------- Net increase (decrease) in net assets............. 37,274,546 5,708,681 (15,150,730) NET ASSETS: Beginning of year................................... 190,699,476 184,990,795 200,141,525 ------------------- -------------------- -------------------- End of year......................................... $ 227,974,022 $ 190,699,476 $ 184,990,795 =================== ==================== ====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 148 The accompanying notes are an integral part of these financial statements. 149 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
MSF JENNISON GROWTH INVESTMENT DIVISION ------------------------------------------------------------------- 2013 2012 2011 -------------------- -------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 69,286 $ 28,105 $ 35,563 Net realized gains (losses)......................... 748,650 2,811,173 251,119 Change in unrealized gains (losses) on investments.. 5,442,828 (683,735) (215,551) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations................................ 6,260,764 2,155,543 71,131 -------------------- -------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 1,523,693 1,531,550 1,444,160 Net transfers (including fixed account)............. (654,269) 2,297,949 (43,841) Policy charges...................................... (1,190,262) (1,167,566) (1,041,433) Transfers for policy benefits and terminations...... (1,960,411) (1,209,351) (1,671,932) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (2,281,249) 1,452,582 (1,313,046) -------------------- -------------------- -------------------- Net increase (decrease) in net assets............. 3,979,515 3,608,125 (1,241,915) NET ASSETS: Beginning of year................................... 17,774,611 14,166,486 15,408,401 -------------------- -------------------- -------------------- End of year......................................... $ 21,754,126 $ 17,774,611 $ 14,166,486 ==================== ==================== ==================== MSF LOOMIS SAYLES SMALL CAP CORE INVESTMENT DIVISION ------------------------------------------------------------------- 2013 2012 2011 -------------------- -------------------- --------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 72,558 $ (18,930) $ 1,388 Net realized gains (losses)......................... 2,242,704 734,986 258,722 Change in unrealized gains (losses) on investments.. 5,169,026 1,736,369 (166,265) -------------------- -------------------- --------------------- Net increase (decrease) in net assets resulting from operations................................ 7,484,288 2,452,425 93,845 -------------------- -------------------- --------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 1,615,232 1,746,601 1,937,235 Net transfers (including fixed account)............. (215,054) (297,817) (342,656) Policy charges...................................... (1,228,517) (1,178,997) (1,184,554) Transfers for policy benefits and terminations...... (1,483,788) (1,329,599) (1,342,670) -------------------- -------------------- --------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (1,312,127) (1,059,812) (932,645) -------------------- -------------------- --------------------- Net increase (decrease) in net assets............. 6,172,161 1,392,613 (838,800) NET ASSETS: Beginning of year................................... 18,836,597 17,443,984 18,282,784 -------------------- -------------------- --------------------- End of year......................................... $ 25,008,758 $ 18,836,597 $ 17,443,984 ==================== ==================== ===================== MSF LOOMIS SAYLES SMALL CAP GROWTH INVESTMENT DIVISION ------------------------------------------------------------------ 2013 2012 2011 -------------------- -------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ (8,824) $ (7,211) $ (7,268) Net realized gains (losses)......................... 444,863 192,524 104,198 Change in unrealized gains (losses) on investments.. 3,463,471 678,535 121,090 -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations................................ 3,899,510 863,848 218,020 -------------------- -------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 804,491 809,473 919,698 Net transfers (including fixed account)............. 748,405 (560,400) 627,796 Policy charges...................................... (585,929) (544,759) (543,214) Transfers for policy benefits and terminations...... (824,857) (652,904) (472,962) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... 142,110 (948,590) 531,318 -------------------- -------------------- -------------------- Net increase (decrease) in net assets............. 4,041,620 (84,742) 749,338 NET ASSETS: Beginning of year................................... 8,095,037 8,179,779 7,430,441 -------------------- -------------------- -------------------- End of year......................................... $ 12,136,657 $ 8,095,037 $ 8,179,779 ==================== ==================== ====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 150 The accompanying notes are an integral part of these financial statements. 151 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
MSF MET/ARTISAN MID CAP VALUE INVESTMENT DIVISION -------------------------------------------------------------------- 2013 2012 2011 --------------------- -------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 506,787 $ 436,661 $ 407,836 Net realized gains (losses)......................... 684,691 (286,700) (412,007) Change in unrealized gains (losses) on investments.. 16,708,173 5,263,295 3,096,938 --------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations................................ 17,899,651 5,413,256 3,092,767 --------------------- -------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 4,818,272 5,235,295 5,738,107 Net transfers (including fixed account)............. (164,067) (939,024) (545,207) Policy charges...................................... (3,575,679) (3,448,574) (3,492,122) Transfers for policy benefits and terminations...... (4,519,220) (3,304,159) (4,205,697) --------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (3,440,694) (2,456,462) (2,504,919) --------------------- -------------------- -------------------- Net increase (decrease) in net assets............. 14,458,957 2,956,794 587,848 NET ASSETS: Beginning of year................................... 50,145,783 47,188,989 46,601,141 --------------------- -------------------- -------------------- End of year......................................... $ 64,604,740 $ 50,145,783 $ 47,188,989 ===================== ==================== ==================== MSF METLIFE CONSERVATIVE ALLOCATION INVESTMENT DIVISION --------------------------------------------------------------------- 2013 2012 2011 --------------------- --------------------- --------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 160,505 $ 138,695 $ 90,783 Net realized gains (losses)......................... 81,883 174,266 77,218 Change in unrealized gains (losses) on investments.. (14,063) 123,869 (37,275) --------------------- --------------------- --------------------- Net increase (decrease) in net assets resulting from operations................................ 228,325 436,830 130,726 --------------------- --------------------- --------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 533,556 568,235 485,812 Net transfers (including fixed account)............. (150,585) 1,144,105 943,856 Policy charges...................................... (484,460) (430,185) (382,404) Transfers for policy benefits and terminations...... (355,218) (704,305) (843,231) --------------------- --------------------- --------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (456,707) 577,850 204,033 --------------------- --------------------- --------------------- Net increase (decrease) in net assets............. (228,382) 1,014,680 334,759 NET ASSETS: Beginning of year................................... 5,385,935 4,371,255 4,036,496 --------------------- --------------------- --------------------- End of year......................................... $ 5,157,553 $ 5,385,935 $ 4,371,255 ===================== ===================== ===================== MSF METLIFE CONSERVATIVE TO MODERATE ALLOCATION INVESTMENT DIVISION -------------------------------------------------------------------- 2013 2012 2011 -------------------- -------------------- --------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 235,287 $ 205,059 $ 143,058 Net realized gains (losses)......................... 306,341 81,535 135,436 Change in unrealized gains (losses) on investments.. 418,401 541,162 (210,123) -------------------- -------------------- --------------------- Net increase (decrease) in net assets resulting from operations................................ 960,029 827,756 68,371 -------------------- -------------------- --------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 1,011,525 1,481,933 968,450 Net transfers (including fixed account)............. 150,570 843,570 (142,377) Policy charges...................................... (748,237) (736,496) (655,066) Transfers for policy benefits and terminations...... (741,985) (304,695) (600,517) -------------------- -------------------- --------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (328,127) 1,284,312 (429,510) -------------------- -------------------- --------------------- Net increase (decrease) in net assets............. 631,902 2,112,068 (361,139) NET ASSETS: Beginning of year................................... 8,676,630 6,564,562 6,925,701 -------------------- -------------------- --------------------- End of year......................................... $ 9,308,532 $ 8,676,630 $ 6,564,562 ==================== ==================== =====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 152 The accompanying notes are an integral part of these financial statements. 153 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
MSF METLIFE MID CAP STOCK INDEX INVESTMENT DIVISION -------------------------------------------------------------------- 2013 2012 2011 -------------------- --------------------- --------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 921,665 $ 611,419 $ 541,527 Net realized gains (losses)......................... 4,180,005 3,617,861 3,401,215 Change in unrealized gains (losses) on investments.. 18,736,176 6,545,785 (4,954,472) -------------------- --------------------- --------------------- Net increase (decrease) in net assets resulting from operations................................ 23,837,846 10,775,065 (1,011,730) -------------------- --------------------- --------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 6,442,989 6,251,227 6,663,417 Net transfers (including fixed account)............. 6,297,964 (874,909) 550,217 Policy charges...................................... (4,821,378) (4,370,955) (4,391,491) Transfers for policy benefits and terminations...... (5,452,511) (4,820,226) (4,758,860) -------------------- --------------------- --------------------- Net increase (decrease) in net assets resulting from policy transactions....................... 2,467,064 (3,814,863) (1,936,717) -------------------- --------------------- --------------------- Net increase (decrease) in net assets............. 26,304,910 6,960,202 (2,948,447) NET ASSETS: Beginning of year................................... 69,807,817 62,847,615 65,796,062 -------------------- --------------------- --------------------- End of year......................................... $ 96,112,727 $ 69,807,817 $ 62,847,615 ==================== ===================== ===================== MSF METLIFE MODERATE ALLOCATION INVESTMENT DIVISION -------------------------------------------------------------------- 2013 2012 2011 -------------------- --------------------- --------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 978,796 $ 983,338 $ 602,357 Net realized gains (losses)......................... 1,591,249 307,411 234,474 Change in unrealized gains (losses) on investments.. 5,640,223 3,912,908 (1,362,402) -------------------- --------------------- --------------------- Net increase (decrease) in net assets resulting from operations................................ 8,210,268 5,203,657 (525,571) -------------------- --------------------- --------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 5,151,753 5,386,770 5,784,576 Net transfers (including fixed account)............. (136,518) 1,630,562 3,395,270 Policy charges...................................... (3,553,677) (3,268,135) (3,141,873) Transfers for policy benefits and terminations...... (3,662,499) (3,139,425) (3,138,424) -------------------- --------------------- --------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (2,200,941) 609,772 2,899,549 -------------------- --------------------- --------------------- Net increase (decrease) in net assets............. 6,009,327 5,813,429 2,373,978 NET ASSETS: Beginning of year................................... 45,401,738 39,588,309 37,214,331 -------------------- --------------------- --------------------- End of year......................................... $ 51,411,065 $ 45,401,738 $ 39,588,309 ==================== ===================== ===================== MSF METLIFE MODERATE TO AGGRESSIVE ALLOCATION INVESTMENT DIVISION -------------------------------------------------------------------- 2013 2012 2011 -------------------- -------------------- --------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 1,331,275 $ 1,452,530 $ 1,000,387 Net realized gains (losses)......................... 1,631,177 342,924 112,005 Change in unrealized gains (losses) on investments.. 15,682,919 8,619,633 (3,772,324) -------------------- -------------------- --------------------- Net increase (decrease) in net assets resulting from operations................................ 18,645,371 10,415,087 (2,659,932) -------------------- -------------------- --------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 9,997,220 10,953,737 12,078,791 Net transfers (including fixed account)............. (970,786) (395,131) 1,724,329 Policy charges...................................... (5,392,604) (5,381,249) (5,360,003) Transfers for policy benefits and terminations...... (5,660,564) (4,722,972) (4,677,007) -------------------- -------------------- --------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (2,026,734) 454,385 3,766,110 -------------------- -------------------- --------------------- Net increase (decrease) in net assets............. 16,618,637 10,869,472 1,106,178 NET ASSETS: Beginning of year................................... 77,039,719 66,170,247 65,064,069 -------------------- -------------------- --------------------- End of year......................................... $ 93,658,356 $ 77,039,719 $ 66,170,247 ==================== ==================== =====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 154 The accompanying notes are an integral part of these financial statements. 155 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
MSF METLIFE STOCK INDEX INVESTMENT DIVISION ------------------------------------------------------------------- 2013 2012 2011 -------------------- -------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 13,291,250 $ 10,948,530 $ 9,520,127 Net realized gains (losses)......................... 24,663,718 8,830,477 3,790,443 Change in unrealized gains (losses) on investments.. 191,004,236 82,239,455 (2,093,968) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations................................ 228,959,204 102,018,462 11,216,602 -------------------- -------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 74,274,408 78,256,067 80,842,256 Net transfers (including fixed account)............. (13,931,092) (12,171,521) (3,601,844) Policy charges...................................... (46,520,238) (45,906,276) (44,463,278) Transfers for policy benefits and terminations...... (56,333,579) (51,016,668) (47,119,534) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (42,510,501) (30,838,398) (14,342,400) -------------------- -------------------- -------------------- Net increase (decrease) in net assets............. 186,448,703 71,180,064 (3,125,798) NET ASSETS: Beginning of year................................... 739,806,231 668,626,167 671,751,965 -------------------- -------------------- -------------------- End of year......................................... $ 926,254,934 $ 739,806,231 $ 668,626,167 ==================== ==================== ==================== MSF MFS TOTAL RETURN INVESTMENT DIVISION ------------------------------------------------------------------ 2013 2012 2011 -------------------- -------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 218,647 $ 214,049 $ 202,563 Net realized gains (losses)......................... 99,210 32,260 (29,847) Change in unrealized gains (losses) on investments.. 1,215,884 595,278 (11,189) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations................................ 1,533,741 841,587 161,527 -------------------- -------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 855,275 920,793 1,027,479 Net transfers (including fixed account)............. 222,090 252,642 (126,958) Policy charges...................................... (611,556) (606,480) (606,881) Transfers for policy benefits and terminations...... (576,957) (627,444) (801,101) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (111,148) (60,489) (507,461) -------------------- -------------------- -------------------- Net increase (decrease) in net assets............. 1,422,593 781,098 (345,934) NET ASSETS: Beginning of year................................... 8,143,436 7,362,338 7,708,272 -------------------- -------------------- -------------------- End of year......................................... $ 9,566,029 $ 8,143,436 $ 7,362,338 ==================== ==================== ==================== MSF MFS VALUE INVESTMENT DIVISION ------------------------------------------------------------------- 2013 2012 2011 -------------------- --------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 1,170,720 $ 1,031,624 $ 789,787 Net realized gains (losses)......................... 3,182,904 969,095 (44,982) Change in unrealized gains (losses) on investments.. 17,288,533 6,505,435 (346,891) -------------------- --------------------- -------------------- Net increase (decrease) in net assets resulting from operations................................ 21,642,157 8,506,154 397,914 -------------------- --------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 5,983,336 5,745,674 6,217,602 Net transfers (including fixed account)............. 7,686,212 (975,483) 423,365 Policy charges...................................... (4,505,565) (3,989,183) (3,874,897) Transfers for policy benefits and terminations...... (4,815,384) (3,759,106) (4,853,465) -------------------- --------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... 4,348,599 (2,978,098) (2,087,395) -------------------- --------------------- -------------------- Net increase (decrease) in net assets............. 25,990,756 5,528,056 (1,689,481) NET ASSETS: Beginning of year................................... 57,891,425 52,363,369 54,052,850 -------------------- --------------------- -------------------- End of year......................................... $ 83,882,181 $ 57,891,425 $ 52,363,369 ==================== ===================== ====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 156 The accompanying notes are an integral part of these financial statements. 157 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
MSF MSCI EAFE INDEX INVESTMENT DIVISION ------------------------------------------------------------------ 2013 2012 2011 -------------------- -------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 2,211,085 $ 1,958,070 $ 1,512,474 Net realized gains (losses)......................... 838,301 (63,228) 137,025 Change in unrealized gains (losses) on investments.. 11,746,223 9,143,347 (9,604,700) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations................................ 14,795,609 11,038,189 (7,955,201) -------------------- -------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 6,716,745 6,997,903 7,277,374 Net transfers (including fixed account)............. 128,185 (1,236,350) 3,903,398 Policy charges...................................... (4,441,685) (4,297,245) (4,316,752) Transfers for policy benefits and terminations...... (4,377,881) (4,040,162) (4,517,098) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (1,974,636) (2,575,854) 2,346,922 -------------------- -------------------- -------------------- Net increase (decrease) in net assets............. 12,820,973 8,462,335 (5,608,279) NET ASSETS: Beginning of year................................... 68,221,885 59,759,550 65,367,829 -------------------- -------------------- -------------------- End of year......................................... $ 81,042,858 $ 68,221,885 $ 59,759,550 ==================== ==================== ==================== MSF NEUBERGER BERMAN GENESIS INVESTMENT DIVISION ------------------------------------------------------------------ 2013 2012 2011 -------------------- -------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 655,453 $ 222,015 $ 520,241 Net realized gains (losses)......................... 614,602 (730,868) (976,828) Change in unrealized gains (losses) on investments.. 30,722,824 8,168,095 4,961,322 -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations................................ 31,992,879 7,659,242 4,504,735 -------------------- -------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 8,008,218 8,263,575 8,942,665 Net transfers (including fixed account)............. 3,343,892 (1,257,789) (1,072,904) Policy charges...................................... (6,107,509) (5,820,066) (5,900,591) Transfers for policy benefits and terminations...... (6,615,611) (5,714,422) (5,912,935) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (1,371,010) (4,528,702) (3,943,765) -------------------- -------------------- -------------------- Net increase (decrease) in net assets............. 30,621,869 3,130,540 560,970 NET ASSETS: Beginning of year................................... 82,409,606 79,279,066 78,718,096 -------------------- -------------------- -------------------- End of year......................................... $ 113,031,475 $ 82,409,606 $ 79,279,066 ==================== ==================== ==================== MSF RUSSELL 2000 INDEX INVESTMENT DIVISION ------------------------------------------------------------------ 2013 2012 2011 -------------------- -------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 935,087 $ 584,115 $ 521,188 Net realized gains (losses)......................... 1,797,318 721,576 734,988 Change in unrealized gains (losses) on investments.. 17,937,722 6,793,518 (3,300,203) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations................................ 20,670,127 8,099,209 (2,044,027) -------------------- -------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 4,998,071 5,255,166 5,547,834 Net transfers (including fixed account)............. (1,828,111) (1,271,073) 238,532 Policy charges...................................... (3,577,463) (3,472,278) (3,520,009) Transfers for policy benefits and terminations...... (3,961,136) (3,852,208) (5,646,773) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (4,368,639) (3,340,393) (3,380,416) -------------------- -------------------- -------------------- Net increase (decrease) in net assets............. 16,301,488 4,758,816 (5,424,443) NET ASSETS: Beginning of year................................... 55,930,600 51,171,784 56,596,227 -------------------- -------------------- -------------------- End of year......................................... $ 72,232,088 $ 55,930,600 $ 51,171,784 ==================== ==================== ====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 158 The accompanying notes are an integral part of these financial statements. 159 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
MSF T. ROWE PRICE LARGE CAP GROWTH INVESTMENT DIVISION ------------------------------------------------------------------- 2013 2012 2011 -------------------- --------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 121,572 $ 35,218 $ 17,757 Net realized gains (losses)......................... 2,302,973 996,117 908,859 Change in unrealized gains (losses) on investments.. 19,823,349 6,924,755 (1,383,140) -------------------- --------------------- -------------------- Net increase (decrease) in net assets resulting from operations................................ 22,247,894 7,956,090 (456,524) -------------------- --------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 4,856,717 3,933,872 4,270,409 Net transfers (including fixed account)............. 12,281,657 1,360,962 162,723 Policy charges...................................... (3,980,799) (3,253,193) (3,125,126) Transfers for policy benefits and terminations...... (4,480,626) (2,912,602) (4,309,233) -------------------- --------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... 8,676,949 (870,961) (3,001,227) -------------------- --------------------- -------------------- Net increase (decrease) in net assets............. 30,924,843 7,085,129 (3,457,751) NET ASSETS: Beginning of year................................... 49,402,465 42,317,336 45,775,087 -------------------- --------------------- -------------------- End of year......................................... $ 80,327,308 $ 49,402,465 $ 42,317,336 ==================== ===================== ==================== MSF T. ROWE PRICE SMALL CAP GROWTH INVESTMENT DIVISION ------------------------------------------------------------------- 2013 2012 2011 -------------------- --------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 16,840 $ (304,065) $ (301,663) Net realized gains (losses)......................... 9,434,117 11,464,320 2,332,511 Change in unrealized gains (losses) on investments.. 30,236,593 2,263,900 (846,789) -------------------- --------------------- -------------------- Net increase (decrease) in net assets resulting from operations................................ 39,687,550 13,424,155 1,184,059 -------------------- --------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 6,334,314 7,087,296 6,244,277 Net transfers (including fixed account)............. (2,078,011) (2,999,440) 3,733,237 Policy charges...................................... (5,566,115) (5,536,576) (5,439,543) Transfers for policy benefits and terminations...... (6,511,897) (5,390,198) (6,901,125) -------------------- --------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (7,821,709) (6,838,918) (2,363,154) -------------------- --------------------- -------------------- Net increase (decrease) in net assets............. 31,865,841 6,585,237 (1,179,095) NET ASSETS: Beginning of year................................... 93,411,008 86,825,771 88,004,866 -------------------- --------------------- -------------------- End of year......................................... $ 125,276,849 $ 93,411,008 $ 86,825,771 ==================== ===================== ==================== MSF VAN ECK GLOBAL NATURAL RESOURCES INVESTMENT DIVISION -------------------------------------------------------------------- 2013 2012 2011 (f) --------------------- -------------------- --------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 669 $ -- $ -- Net realized gains (losses)......................... (55) 1,884 (45) Change in unrealized gains (losses) on investments.. 14,171 (2,269) (2,198) --------------------- -------------------- --------------------- Net increase (decrease) in net assets resulting from operations................................ 14,785 (385) (2,243) --------------------- -------------------- --------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 55,907 16,626 3,321 Net transfers (including fixed account)............. 60,548 29,151 12,824 Policy charges...................................... (13,231) (5,086) (710) Transfers for policy benefits and terminations...... (1,067) (62) (13) --------------------- -------------------- --------------------- Net increase (decrease) in net assets resulting from policy transactions....................... 102,157 40,629 15,422 --------------------- -------------------- --------------------- Net increase (decrease) in net assets............. 116,942 40,244 13,179 NET ASSETS: Beginning of year................................... 53,423 13,179 -- --------------------- -------------------- --------------------- End of year......................................... $ 170,365 $ 53,423 $ 13,179 ===================== ==================== =====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 160 The accompanying notes are an integral part of these financial statements. 161 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
MSF WESTERN ASSET MANAGEMENT STRATEGIC BOND OPPORTUNITIES INVESTMENT DIVISION ------------------------------------------------------------------ 2013 2012 2011 -------------------- -------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 1,226,086 $ 859,018 $ 1,177,683 Net realized gains (losses)......................... 194,088 204,230 144,847 Change in unrealized gains (losses) on investments.. (1,174,913) 1,584,984 64,600 -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations................................ 245,261 2,648,232 1,387,130 -------------------- -------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 2,229,010 2,376,193 2,593,403 Net transfers (including fixed account)............. 1,081,271 559,734 (646,114) Policy charges...................................... (1,575,456) (1,697,175) (1,707,630) Transfers for policy benefits and terminations...... (2,069,679) (1,967,837) (1,876,403) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (334,854) (729,085) (1,636,744) -------------------- -------------------- -------------------- Net increase (decrease) in net assets............. (89,593) 1,919,147 (249,614) NET ASSETS: Beginning of year................................... 25,456,035 23,536,888 23,786,502 -------------------- -------------------- -------------------- End of year......................................... $ 25,366,442 $ 25,456,035 $ 23,536,888 ==================== ==================== ==================== MSF WESTERN ASSET MANAGEMENT U.S. GOVERNMENT INVESTMENT DIVISION ------------------------------------------------------------------- 2013 2012 2011 -------------------- -------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 337,175 $ 330,891 $ 229,900 Net realized gains (losses)......................... 3,029 19,763 564,972 Change in unrealized gains (losses) on investments.. (476,487) 185,906 82,587 -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations................................ (136,283) 536,560 877,459 -------------------- -------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 1,775,872 1,850,612 2,130,621 Net transfers (including fixed account)............. 653,302 271,627 (428,475) Policy charges...................................... (1,231,455) (1,308,474) (1,367,530) Transfers for policy benefits and terminations...... (1,189,735) (1,163,575) (1,409,928) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... 7,984 (349,810) (1,075,312) -------------------- -------------------- -------------------- Net increase (decrease) in net assets............. (128,299) 186,750 (197,853) NET ASSETS: Beginning of year................................... 16,622,548 16,435,798 16,633,651 -------------------- -------------------- -------------------- End of year......................................... $ 16,494,249 $ 16,622,548 $ 16,435,798 ==================== ==================== ==================== PIMCO VIT ALL ASSET INVESTMENT DIVISION ------------------------------------------------------------------- 2013 2012 2011 (f) --------------------- -------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 21,748 $ 6,301 $ 2,796 Net realized gains (losses)......................... (591) 190 -- Change in unrealized gains (losses) on investments.. (24,638) 8,832 (1,176) --------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations................................ (3,481) 15,323 1,620 --------------------- -------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ -- -- 8,337 Net transfers (including fixed account)............. 897,967 24,949 86,523 Policy charges...................................... (7,144) (4,485) (342) Transfers for policy benefits and terminations...... (94,966) (6) -- --------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions....................... 795,857 20,458 94,518 --------------------- -------------------- -------------------- Net increase (decrease) in net assets............. 792,376 35,781 96,138 NET ASSETS: Beginning of year................................... 131,919 96,138 -- --------------------- -------------------- -------------------- End of year......................................... $ 924,295 $ 131,919 $ 96,138 ===================== ==================== ====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 162 The accompanying notes are an integral part of these financial statements. 163 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
PIMCO VIT COMMODITY REAL RETURN STRATEGY INVESTMENT DIVISION -------------------- 2013 (e) -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)............. $ -- Net realized gains (losses).............. (5) Change in unrealized gains (losses) on investments......................... (126) -------------------- Net increase (decrease) in net assets resulting from operations........... (131) -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners.......................... -- Net transfers (including fixed account).. 6,189 Policy charges........................... (275) Transfers for policy benefits and terminations........................... -- -------------------- Net increase (decrease) in net assets resulting from policy transactions.. 5,914 -------------------- Net increase (decrease) in net assets.. 5,783 NET ASSETS: Beginning of year........................ -- -------------------- End of year.............................. $ 5,783 ==================== PIMCO VIT LOW DURATION INVESTMENT DIVISION ------------------------------------------------------------------ 2013 2012 2011 -------------------- -------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)............. $ 22,872 $ 18,366 $ 13,732 Net realized gains (losses).............. 3,304 1,749 618 Change in unrealized gains (losses) on investments......................... (33,450) 34,493 (6,243) -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from operations........... (7,274) 54,608 8,107 -------------------- -------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners.......................... 2,809 33,008 43,028 Net transfers (including fixed account).. 888,377 (5,071) 153,678 Policy charges........................... (36,664) (42,837) (21,336) Transfers for policy benefits and terminations........................... (262,466) (202) -- -------------------- -------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions.. 592,056 (15,102) 175,370 -------------------- -------------------- -------------------- Net increase (decrease) in net assets.. 584,782 39,506 183,477 NET ASSETS: Beginning of year........................ 985,514 946,008 762,531 -------------------- -------------------- -------------------- End of year.............................. $ 1,570,296 $ 985,514 $ 946,008 ==================== ==================== ==================== PIONEER VCT EMERGING MARKETS INVESTMENT DIVISION ----------------------------------------------------------------- 2013 2012 2011 -------------------- ------------------- ------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)............. $ 2,107 $ 1,600 $ -- Net realized gains (losses).............. 7,544 22,375 121,447 Change in unrealized gains (losses) on investments......................... (24,888) 20,209 (327,299) -------------------- ------------------- ------------------- Net increase (decrease) in net assets resulting from operations........... (15,237) 44,184 (205,852) -------------------- ------------------- ------------------- POLICY TRANSACTIONS: Premium payments received from policy owners.......................... 73,106 83,715 104,589 Net transfers (including fixed account).. (19,573) 166,019 193,458 Policy charges........................... (16,208) (22,137) (25,931) Transfers for policy benefits and terminations........................... (426,418) -- (649,132) -------------------- ------------------- ------------------- Net increase (decrease) in net assets resulting from policy transactions.. (389,093) 227,597 (377,016) -------------------- ------------------- ------------------- Net increase (decrease) in net assets.. (404,330) 271,781 (582,868) NET ASSETS: Beginning of year........................ 673,079 401,298 984,166 -------------------- ------------------- ------------------- End of year.............................. $ 268,749 $ 673,079 $ 401,298 ==================== =================== =================== PIONEER VCT MID CAP VALUE INVESTMENT DIVISION ----------------------------------------------------------------- 2013 2012 2011 ------------------- ------------------- ------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)............. $ 425 $ 1,561 $ 1,190 Net realized gains (losses).............. 29,038 595 580 Change in unrealized gains (losses) on investments......................... (1,134) 12,468 (11,556) ------------------- ------------------- ------------------- Net increase (decrease) in net assets resulting from operations........... 28,329 14,624 (9,786) ------------------- ------------------- ------------------- POLICY TRANSACTIONS: Premium payments received from policy owners.......................... -- 8,995 -- Net transfers (including fixed account).. (126,970) 1,893 51,112 Policy charges........................... (4,969) (6,747) (6,021) Transfers for policy benefits and terminations........................... -- -- (3) ------------------- ------------------- ------------------- Net increase (decrease) in net assets resulting from policy transactions.. (131,939) 4,141 45,088 ------------------- ------------------- ------------------- Net increase (decrease) in net assets.. (103,610) 18,765 35,302 NET ASSETS: Beginning of year........................ 153,545 134,780 99,478 ------------------- ------------------- ------------------- End of year.............................. $ 49,935 $ 153,545 $ 134,780 =================== =================== ===================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 164 The accompanying notes are an integral part of these financial statements. 165 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
PUTNAM VT INTERNATIONAL VALUE INVESTMENT DIVISION -------------------- 2013 (b) -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)............. $ -- Net realized gains (losses).............. 10 Change in unrealized gains (losses) on investments......................... 477 -------------------- Net increase (decrease) in net assets resulting from operations........... 487 -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners.......................... -- Net transfers (including fixed account).. 6,234 Policy charges........................... (293) Transfers for policy benefits and terminations........................... -- -------------------- Net increase (decrease) in net assets resulting from policy transactions.. 5,941 -------------------- Net increase (decrease) in net assets.. 6,428 NET ASSETS: Beginning of year........................ -- -------------------- End of year.............................. $ 6,428 ==================== ROYCE MICRO-CAP INVESTMENT DIVISION ------------------------------------------------------------------- 2013 2012 2011 -------------------- --------------------- -------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)............. $ 38 $ -- $ 8,331 Net realized gains (losses).............. 87,715 9,077 1,545 Change in unrealized gains (losses) on investments......................... (23,953) 15,667 (52,132) -------------------- --------------------- -------------------- Net increase (decrease) in net assets resulting from operations........... 63,800 24,744 (42,256) -------------------- --------------------- -------------------- POLICY TRANSACTIONS: Premium payments received from policy owners.......................... 1,884 49,620 4,792 Net transfers (including fixed account).. (423,639) -- 7,703 Policy charges........................... (6,293) (7,913) (8,474) Transfers for policy benefits and terminations........................... (1) (4,908) (11) -------------------- --------------------- -------------------- Net increase (decrease) in net assets resulting from policy transactions.. (428,049) 36,799 4,010 -------------------- --------------------- -------------------- Net increase (decrease) in net assets.. (364,249) 61,543 (38,246) NET ASSETS: Beginning of year........................ 372,006 310,463 348,709 -------------------- --------------------- -------------------- End of year.............................. $ 7,757 $ 372,006 $ 310,463 ==================== ===================== ==================== ROYCE SMALL-CAP INVESTMENT DIVISION -------------------------------------------------------------------- 2013 2012 2011 -------------------- -------------------- --------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)............. $ 6,679 $ 586 $ 3,804 Net realized gains (losses).............. 68,918 35,664 18,080 Change in unrealized gains (losses) on investments......................... 110,499 34,489 (64,398) -------------------- -------------------- --------------------- Net increase (decrease) in net assets resulting from operations........... 186,096 70,739 (42,514) -------------------- -------------------- --------------------- POLICY TRANSACTIONS: Premium payments received from policy owners.......................... -- 8,995 4,584 Net transfers (including fixed account).. (28,963) (281,935) 740,973 Policy charges........................... (10,076) (10,669) (19,814) Transfers for policy benefits and terminations........................... -- -- (321,629) -------------------- -------------------- --------------------- Net increase (decrease) in net assets resulting from policy transactions.. (39,039) (283,609) 404,114 -------------------- -------------------- --------------------- Net increase (decrease) in net assets.. 147,057 (212,870) 361,600 NET ASSETS: Beginning of year........................ 541,872 754,742 393,142 -------------------- -------------------- --------------------- End of year.............................. $ 688,929 $ 541,872 $ 754,742 ==================== ==================== ===================== UIF EMERGING MARKETS DEBT INVESTMENT DIVISION -------------------------------------------------------------------- 2013 2012 2011 --------------------- -------------------- --------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)............. $ 51,315 $ 16,821 $ 7,775 Net realized gains (losses).............. 10,886 2,466 2,814 Change in unrealized gains (losses) on investments......................... (181,259) 89,788 79 --------------------- -------------------- --------------------- Net increase (decrease) in net assets resulting from operations........... (119,058) 109,075 10,668 --------------------- -------------------- --------------------- POLICY TRANSACTIONS: Premium payments received from policy owners.......................... 64,400 64,771 2,057 Net transfers (including fixed account).. 136,192 599,117 408,567 Policy charges........................... (20,164) (10,880) (4,269) Transfers for policy benefits and terminations........................... (83,949) (483) (3,368) --------------------- -------------------- --------------------- Net increase (decrease) in net assets resulting from policy transactions.. 96,479 652,525 402,987 --------------------- -------------------- --------------------- Net increase (decrease) in net assets.. (22,579) 761,600 413,655 NET ASSETS: Beginning of year........................ 1,182,598 420,998 7,343 --------------------- -------------------- --------------------- End of year.............................. $ 1,160,019 $ 1,182,598 $ 420,998 ===================== ==================== =====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 166 The accompanying notes are an integral part of these financial statements. 167 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY STATEMENTS OF CHANGES IN NET ASSETS -- (CONCLUDED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011
UIF EMERGING MARKETS EQUITY INVESTMENT DIVISION -------------------------------------------------------------------- 2013 2012 2011 -------------------- -------------------- --------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 14,065 $ -- $ 1,515 Net realized gains (losses)......................... 6,766 (26) 4,478 Change in unrealized gains (losses) on investments.. (38,224) 139,206 (99,779) -------------------- -------------------- --------------------- Net increase (decrease) in net assets resulting from operations................................ (17,393) 139,180 (93,786) -------------------- -------------------- --------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 58,675 70,772 2,923 Net transfers (including fixed account)............. 283,169 302,018 444,567 Policy charges...................................... (21,217) (17,053) (11,985) Transfers for policy benefits and terminations...... (100,720) (361) -- -------------------- -------------------- --------------------- Net increase (decrease) in net assets resulting from policy transactions....................... 219,907 355,376 435,505 -------------------- -------------------- --------------------- Net increase (decrease) in net assets............. 202,514 494,556 341,719 NET ASSETS: Beginning of year................................... 1,033,944 539,388 197,669 -------------------- -------------------- --------------------- End of year......................................... $ 1,236,458 $ 1,033,944 $ 539,388 ==================== ==================== ===================== WELLS FARGO VT TOTAL RETURN BOND INVESTMENT DIVISION -------------------------------------------------------------------- 2013 2012 2011 -------------------- --------------------- --------------------- INCREASE (DECREASE) IN NET ASSETS: FROM OPERATIONS: Net investment income (loss)........................ $ 4,298 $ 4,369 $ 18,903 Net realized gains (losses)......................... 10,856 7,755 45,796 Change in unrealized gains (losses) on investments.. (21,523) 5,968 (7,169) -------------------- --------------------- --------------------- Net increase (decrease) in net assets resulting from operations................................ (6,369) 18,092 57,530 -------------------- --------------------- --------------------- POLICY TRANSACTIONS: Premium payments received from policy owners........ 30,618 45,280 66,775 Net transfers (including fixed account)............. (5,806) 301,563 (413,486) Policy charges...................................... (12,342) (11,089) (19,736) Transfers for policy benefits and terminations...... (237,322) -- (637,284) -------------------- --------------------- --------------------- Net increase (decrease) in net assets resulting from policy transactions....................... (224,852) 335,754 (1,003,731) -------------------- --------------------- --------------------- Net increase (decrease) in net assets............. (231,221) 353,846 (946,201) NET ASSETS: Beginning of year................................... 489,060 135,214 1,081,415 -------------------- --------------------- --------------------- End of year......................................... $ 257,839 $ 489,060 $ 135,214 ==================== ===================== =====================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. The accompanying notes are an integral part of these financial statements. 168 The accompanying notes are an integral part of these financial statements. 169 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY NOTES TO THE FINANCIAL STATEMENTS 1. ORGANIZATION Metropolitan Life Separate Account UL (the "Separate Account"), a separate account of Metropolitan Life Insurance Company (the "Company"), was established by the Company's Board of Directors on December 13, 1988 to support operations of the Company with respect to certain variable life insurance policies (the "Policies"). The Company is a direct wholly-owned subsidiary of MetLife, Inc., a Delaware corporation. The Separate Account is registered as a unit investment trust under the Investment Company Act of 1940, as amended, and exists in accordance with the regulations of the New York State Department of Financial Services. The Separate Account is divided into Investment Divisions, each of which is treated as an individual accounting entity for financial reporting purposes. Each Investment Division invests in shares of the corresponding fund, portfolio, or series (with the same name) of registered investment management companies (the "Trusts"), which are presented below: AIM Variable Insurance Funds (Invesco Variable Legg Mason Partners Variable Equity Trust ("LMPVET") Insurance Funds) ("Invesco V.I.") Met Investors Series Trust ("MIST")* AllianceBernstein Variable Products Series Fund, Inc. Metropolitan Series Fund ("MSF")* ("AllianceBernstein") MFS Variable Insurance Trust ("MFS VIT") American Century Variable Portfolios, Inc. ("American MFS Variable Insurance Trust II ("MFS VIT II") Century VP") Oppenheimer Variable Account Funds American Funds Insurance Series ("American Funds") ("Oppenheimer VA") Dreyfus Variable Investment Fund ("Dreyfus VIF") PIMCO Variable Insurance Trust ("PIMCO VIT") Fidelity Variable Insurance Products ("Fidelity VIP") Pioneer Variable Contracts Trust ("Pioneer VCT") Franklin Templeton Variable Insurance Products Trust Putnam Variable Trust ("Putnam VT") ("FTVIPT") Royce Capital Fund ("Royce") Goldman Sachs Variable Insurance Trust ("Goldman The Universal Institutional Funds, Inc. ("UIF") Sachs") Wells Fargo Variable Trust ("Wells Fargo VT") Janus Aspen Series ("Janus Aspen")
*See Note 5 for a discussion of additional information on related party transactions. The assets of each of the Investment Divisions of the Separate Account are registered in the name of the Company. Under applicable insurance law, the assets and liabilities of the Separate Account are clearly identified and distinguished from the Company's other assets and liabilities. The portion of the Separate Account's assets applicable to the Policies is not chargeable with liabilities arising out of any other business the Company may conduct. 2. LIST OF INVESTMENT DIVISIONS A. Premium payments, less any applicable charges, applied to the Separate Account are invested in one or more Investment Divisions in accordance with the selection made by the policy owner. The following Investment Divisions had net assets as of December 31, 2013: AllianceBernstein Global Thematic Growth Investment American Funds International Investment Division Division American Funds U.S. Government/AAA-Rated AllianceBernstein Intermediate Bond Investment Securities Investment Division Division Dreyfus VIF International Value Investment Division American Century VP Vista Investment Division Fidelity VIP Asset Manager: Growth Investment American Funds Bond Investment Division Division American Funds Global Small Capitalization Fidelity VIP Contrafund Investment Division Investment Division Fidelity VIP Equity-Income Investment Division American Funds Growth Investment Division Fidelity VIP Freedom 2010 Investment Division American Funds Growth-Income Investment Division Fidelity VIP Freedom 2020 Investment Division American Funds High-Income Bond Investment Fidelity VIP Freedom 2025 Investment Division Division Fidelity VIP Freedom 2030 Investment Division
170 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY NOTES TO THE FINANCIAL STATEMENTS -- (CONTINUED) 2. LIST OF INVESTMENT DIVISIONS -- (CONTINUED) Fidelity VIP Freedom 2040 Investment Division MIST Invesco Balanced-Risk Allocation Investment Fidelity VIP Freedom 2050 Investment Division Division Fidelity VIP High Income Investment Division MIST Invesco Mid Cap Value Investment Division Fidelity VIP Investment Grade Bond Investment MIST Invesco Small Cap Growth Investment Division (a) Division MIST JPMorgan Global Active Allocation Investment Fidelity VIP Mid Cap Investment Division Division FTVIPT Franklin Income Securities Investment MIST JPMorgan Small Cap Value Investment Division Division (b) MIST Loomis Sayles Global Markets Investment FTVIPT Mutual Global Discovery Securities Division (b) Investment Division MIST Lord Abbett Bond Debenture Investment Division FTVIPT Mutual Shares Securities Investment MIST Met/Templeton International Bond Investment Division (b) Division FTVIPT Templeton Foreign Securities Investment MIST MetLife Aggressive Strategy Investment Division Division (a) FTVIPT Templeton Global Bond Securities Investment MIST MetLife Balanced Plus Investment Division Division MIST MetLife Growth Strategy Investment Division (b) Goldman Sachs Mid-Cap Value Investment Division MIST MetLife Multi-Index Targeted Risk Investment Goldman Sachs Structured Small Cap Equity Division (b) Investment Division MIST MFS Emerging Markets Equity Investment Invesco V.I. Comstock Investment Division Division Invesco V.I. Global Real Estate Investment Division MIST MFS Research International Investment Invesco V.I. Government Securities Investment Division Division (a) Invesco V.I. International Growth Investment Division MIST Morgan Stanley Mid Cap Growth Investment Janus Aspen Balanced Investment Division Division Janus Aspen Forty Investment Division MIST Oppenheimer Global Equity Investment Janus Aspen Janus Investment Division Division Janus Aspen Overseas Investment Division MIST PIMCO Inflation Protected Bond Investment MFS VIT Global Equity Investment Division Division MFS VIT New Discovery Investment Division MIST PIMCO Total Return Investment Division MFS VIT Value Investment Division MIST Pioneer Fund Investment Division MFS VIT II High Yield Investment Division (b) MIST Pyramis Managed Risk Investment Division (b) MIST AllianceBernstein Global Dynamic Allocation MIST Schroders Global Multi-Asset Investment Investment Division Division MIST American Funds Balanced Allocation Investment MIST SSgA Growth and Income ETF Investment Division Division MIST American Funds Growth Allocation Investment MIST SSgA Growth ETF Investment Division Division MIST T. Rowe Price Large Cap Value Investment MIST American Funds Moderate Allocation Investment Division Division MIST T. Rowe Price Mid Cap Growth Investment MIST AQR Global Risk Balanced Investment Division Division (a) MIST BlackRock Global Tactical Strategies Investment MIST Third Avenue Small Cap Value Investment Division Division MIST BlackRock Large Cap Core Investment Division MSF Baillie Gifford International Stock Investment MIST Clarion Global Real Estate Investment Division (a) Division MIST ClearBridge Aggressive Growth II Investment MSF Barclays Aggregate Bond Index Investment Division Division MIST ClearBridge Aggressive Growth Investment MSF BlackRock Bond Income Investment Division Division MSF BlackRock Capital Appreciation Investment MIST Harris Oakmark International Investment Division Division
171 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY NOTES TO THE FINANCIAL STATEMENTS -- (CONTINUED) 2. LIST OF INVESTMENT DIVISIONS -- (CONCLUDED) MSF BlackRock Diversified Investment Division MSF Neuberger Berman Genesis Investment Division MSF BlackRock Large Cap Value Investment Division MSF Russell 2000 Index Investment Division MSF BlackRock Money Market Investment Division MSF T. Rowe Price Large Cap Growth Investment MSF Davis Venture Value Investment Division Division MSF Frontier Mid Cap Growth Investment Division MSF T. Rowe Price Small Cap Growth Investment MSF Jennison Growth Investment Division Division MSF Loomis Sayles Small Cap Core Investment MSF Van Eck Global Natural Resources Investment Division Division MSF Loomis Sayles Small Cap Growth Investment MSF Western Asset Management Strategic Bond Division Opportunities Investment Division MSF Met/Artisan Mid Cap Value Investment Division (a) MSF Western Asset Management U.S. Government MSF MetLife Conservative Allocation Investment Investment Division Division (a) PIMCO VIT All Asset Investment Division MSF MetLife Conservative to Moderate Allocation PIMCO VIT Commodity Real Return Strategy Investment Division (a) Investment Division (b) MSF MetLife Mid Cap Stock Index Investment PIMCO VIT Low Duration Investment Division Division Pioneer VCT Emerging Markets Investment Division MSF MetLife Moderate Allocation Investment Pioneer VCT Mid Cap Value Investment Division Division (a) Putnam VT International Value Investment Division MSF MetLife Moderate to Aggressive Allocation Royce Micro-Cap Investment Division Investment Division Royce Small-Cap Investment Division MSF MetLife Stock Index Investment Division UIF Emerging Markets Debt Investment Division MSF MFS Total Return Investment Division (a) UIF Emerging Markets Equity Investment Division MSF MFS Value Investment Division Wells Fargo VT Total Return Bond Investment MSF MSCI EAFE Index Investment Division Division
(a) This Investment Division invests in two or more share classes within the underlying fund, portfolio, or series of the Trusts. (b) This Investment Division began operations during the year ended December 31, 2013. B. The following Investment Divisions had no net assets as of December 31, 2013: AllianceBernstein International Value Investment Oppenheimer VA Main Street Small Cap Investment Division Division Fidelity VIP Freedom 2015 Investment Division PIMCO VIT Long-Term U.S. Government Investment Janus Aspen Enterprise Investment Division Division LMPVET Investment Counsel Variable Social Awareness Investment Division
3. PORTFOLIO CHANGES The following Investment Divisions ceased operations during the year ended December 31, 2013: MFS VIT High Income Investment Division MIST MLA Mid Cap Investment Division MIST Met/Franklin Income Investment Division MIST RCM Technology Investment Division MIST Met/Franklin Mutual Shares Investment Division MSF FI Value Leaders Investment Division MIST Met/Franklin Templeton Founding Strategy MSF Oppenheimer Global Equity Investment Division Investment Division
172 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY NOTES TO THE FINANCIAL STATEMENTS -- (CONTINUED) 3. PORTFOLIO CHANGES -- (CONCLUDED) The operations of the Investment Divisions were affected by the following changes that occurred during the year ended December 31, 2013: NAME CHANGES: Former Name New Name Invesco Van Kampen V.I. Comstock Fund Invesco V.I. Comstock Fund (MIST) Dreman Small Cap Value Portfolio (MIST) JPMorgan Small Cap Value Portfolio (MIST) Janus Forty Portfolio (MIST) ClearBridge Aggressive Growth Portfolio II (MIST) Legg Mason ClearBridge Aggressive Growth (MIST) ClearBridge Aggressive Growth Portfolio Portfolio (MIST) Lord Abbett Mid Cap Value Portfolio (MIST) Invesco Mid Cap Value Portfolio (MIST) Met/Templeton Growth Portfolio (a) (MIST) Oppenheimer Global Equity Portfolio (a) (MSF) Barclays Capital Aggregate Bond Index Portfolio (MSF) Barclays Aggregate Bond Index Portfolio (MSF) BlackRock Aggressive Growth Portfolio (MSF) Frontier Mid Cap Growth Portfolio (MSF) BlackRock Legacy Large Cap Growth Portfolio (MSF) BlackRock Capital Appreciation Portfolio Oppenheimer Main Street Small- & Mid-Cap Fund/VA Oppenheimer Main Street Small Cap Fund/VA
MERGERS: Former Portfolio New Portfolio MFS High Income Series MFS High Yield Portfolio (MIST) Met/Franklin Income Portfolio (MIST) Loomis Sayles Global Markets Portfolio (MIST) Met/Franklin Mutual Shares Portfolio (MSF) MFS Value Portfolio (MIST) Met/Franklin Templeton Founding Strategy (MIST) MetLife Growth Strategy Portfolio Portfolio (MIST) MLA Mid Cap Portfolio (MSF) Neuberger Berman Genesis Portfolio (MIST) RCM Technology Portfolio (MSF) T. Rowe Price Large Cap Growth Portfolio (MSF) FI Value Leaders Portfolio (MSF) MFS Value Portfolio (MSF) Oppenheimer Global Equity Portfolio (a) (MIST) Met/Templeton Growth Portfolio (a)
(a) At the close of business on April 26, 2013, the (MSF) Oppenheimer Global Equity Portfolio merged with and into the (MIST) Met/Templeton Growth Portfolio. Concurrently, OppenheimerFunds, Inc. became the subadviser of the (MIST) Met/Templeton Growth Portfolio, the portfolio's investment objective and principal investment strategies changed, and the portfolio's name was changed to (MIST) Oppenheimer Global Equity Portfolio. Pursuant to these changes, the MSF Oppenheimer Global Equity Portfolio was deemed to be the accounting and performance survivor of the merger for financial reporting purposes, and therefore, the results of MIST Oppenheimer Global Equity Investment Division presented in the financial statements reflect the historical results of MSF Oppenheimer Global Equity Investment Division prior to the merger, and the combined results thereafter. 4. SIGNIFICANT ACCOUNTING POLICIES BASIS OF ACCOUNTING The financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("GAAP") applicable for variable life separate accounts registered as unit investment trusts. SECURITY TRANSACTIONS Security transactions are recorded on a trade date basis. Realized gains and losses on the sales of investments are computed on the basis of the average cost of the investment sold. Income from dividends and realized gain distributions are recorded on the ex-distribution date. 173 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY NOTES TO THE FINANCIAL STATEMENTS -- (CONTINUED) 4. SIGNIFICANT ACCOUNTING POLICIES -- (CONTINUED) SECURITY VALUATION An Investment Division's investment in shares of a fund, portfolio, or series of the Trusts is valued at fair value based on the closing net asset value ("NAV") or price per share as determined by the Trusts as of the end of the year. All changes in fair value are recorded as changes in unrealized gains (losses) on investments in the statements of operations of the applicable Investment Divisions. The Separate Account defines fair value as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The Separate Account prioritizes the inputs to fair valuation techniques and allows for the use of unobservable inputs to the extent that observable inputs are not available. The Separate Account has categorized its assets based on the priority of the inputs to the respective valuation technique. The fair value hierarchy gives the highest priority to quoted prices in active markets for identical assets (Level 1) and the lowest priority to unobservable inputs (Level 3). An asset's classification within the fair value hierarchy is based on the lowest level of significant input to its valuation. The input levels are as follows: Level 1 Unadjusted quoted prices in active markets for identical assets that the Separate Account has the ability to access. Level 2 Observable inputs other than quoted prices in Level 1 that are observable either directly or indirectly. These inputs may include quoted prices for the identical instrument on an inactive market or prices for similar instruments. Level 3 Unobservable inputs that are supported by little or no market activity and are significant to the fair value of the assets, representing the Separate Account's own assumptions about the assumptions a market participant would use in valuing the asset, and based on the best information available. Each Investment Division invests in shares of open-end mutual funds which calculate a daily NAV based on the fair value of the underlying securities in their portfolios. As a result, and as required by law, shares of open-end mutual funds are purchased and redeemed at their quoted daily NAV as reported by the Trusts at the close of each business day. On that basis, the inputs used to value all shares held by the Separate Account, which are measured at fair value on a recurring basis, are classified as Level 2. There were no transfers between Level 1 and Level 2, and no activity in Level 3 during the year. FEDERAL INCOME TAXES The operations of the Separate Account form a part of the total operations of the Company and are not taxed separately. The Company is taxed as a life insurance company under the provisions of the Internal Revenue Code ("IRC"). Under the current provisions of the IRC, the Company does not expect to incur federal income taxes on the earnings of the Separate Account to the extent the earnings are credited under the Policies. Accordingly, no charge is currently being made to the Separate Account for federal income taxes. The Company will periodically review the status of this policy in the event of changes in the tax law. A charge may be made in future years for any federal income taxes that would be attributable to the Policies. PREMIUM PAYMENTS The Company deducts a sales charge for certain Policies and a state premium tax charge from premiums before amounts are allocated to the Separate Account. In the case of certain Policies, the Company also deducts a federal income tax charge before amounts are allocated to the Separate Account. This federal income tax charge is imposed in connection with certain Policies to recover a portion of the federal income tax adjustment attributable to policy acquisition expenses. Net premiums are reported as premium payments received from policy owners on the statements of changes in net assets of the applicable Investment Divisions and are credited as accumulation units. NET TRANSFERS Funds transferred by the policy owner into or out of Investment Divisions within the Separate Account or into or out of the fixed account, which is part the Company's general account, are recorded on a net basis as net transfers in the statements of changes in net assets of the applicable Investment Divisions. 174 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY NOTES TO THE FINANCIAL STATEMENTS -- (CONTINUED) 4. SIGNIFICANT ACCOUNTING POLICIES -- (CONCLUDED) USE OF ESTIMATES The preparation of financial statements in accordance with GAAP requires management to make estimates and assumptions that affect amounts reported herein. Actual results could differ from these estimates. 5. EXPENSES AND RELATED PARTY TRANSACTIONS The following annual Separate Account charge paid to the Company, is an asset-based charge and assessed through a daily reduction in unit values, which is recorded as an expense in the accompanying statements of operations of the applicable Investment Divisions: Mortality and Expense Risk -- The mortality risk assumed by the Company is the risk that those insured may die sooner than anticipated and therefore, the Company will pay an aggregate amount of death benefits greater than anticipated. The expense risk assumed is the risk that expenses incurred in issuing and administering the Policies will exceed the amounts realized from the administrative charges assessed against the Policies. The table below represents the range of effective annual rates for the charge for the year ended December 31, 2013: ------------------------------------------------------------------------------------------------------------------------- Mortality and Expense Risk 0.00% - 0.90% -------------------------------------------------------------------------------------------------------------------------
The above referenced charge may not necessarily correspond to the costs associated with providing the services or benefits indicated by the designation of the charge or associated with a particular policy. For some Policies, a mortality and expense risk charge ranging from 0.30% to 0.90% is assessed through the redemption of units on a monthly basis and recorded as mortality and expense risk charges in the statements of changes in net assets of the applicable Investment Divisions. Other policy charges that are assessed through the redemption of units generally include: Cost of Insurance ("COI") charges, administrative charges, a policy fee, and charges for benefits provided by rider, if any. The COI charge is the primary charge under the policy for the death benefit provided by the Company which may vary by policy based on underwriting criteria. Administrative charges range from $0 to $15 and are assessed monthly. For some Policies, a surrender charge is imposed if the policy is partially or fully surrendered within the specified surrender charge period that ranges from $3.75 to $38.25 for every $1,000 of the policy face amount. Surrender charges for other Policies are equal to the lesser of the maximum surrender charge premium or the premiums actually paid in the first two policy years. For these policies, in the first policy year, the maximum surrender charge premium is 75% of the smoker federal guideline premium for the policy, assuming a level death benefit for the policy and any riders; and in the second and later policy years, it is 100% of the smoker federal guideline premium for the policy, assuming a level death benefit for the policy and any riders. The surrender charge cannot exceed 100% of the cumulative premiums paid in the first two policy years. If the policy is surrendered in the first two policy years, the Company will deduct 100% of the surrender charge, determined as described above. After the second policy year, the percentage the Company deducts declines until it reaches 0% at the end of the 15th policy year. Most policies offer optional benefits that can be added to the policy by rider. The charge for riders that provide life insurance benefits can range from $0.01 to $83.33 per $1,000 of coverage and the charge for riders providing benefits in the event of disability can range from $0.00 to $61.44 per $100 of the benefit provided. The above referenced charges are paid to the Company and are recorded as policy charges in the accompanying statements of changes in net assets of the applicable Investment Divisions for the years ended December 31, 2013, 2012 and 2011. MetLife Advisers, LLC, which acts in the capacity of investment adviser to the portfolios of the MIST and MSF Trusts, is an affiliate of the Company. 175 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY NOTES TO THE FINANCIAL STATEMENTS -- (CONTINUED) 6. STATEMENTS OF INVESTMENTS
AS OF DECEMBER 31, ------------------------ SHARES COST ($) ----------- ----------- 2013 2013 ----------- ----------- AllianceBernstein Global Thematic Growth Investment Division...... 3,279 61,372 AllianceBernstein Intermediate Bond Investment Division...... 5,186 62,045 American Century VP Vista Investment Division...... 31 512 American Funds Bond Investment Division...... 526,793 5,714,433 American Funds Global Small Capitalization Investment Division...... 2,854,124 57,758,788 American Funds Growth Investment Division...... 2,059,960 106,291,155 American Funds Growth-Income Investment Division...... 2,008,198 69,926,161 American Funds High-Income Bond Investment Division...... 1,597 17,799 American Funds International Investment Division................. 32,406 595,700 American Funds U.S. Government/AAA-Rated Securities Investment Division................. 3,929 48,855 Dreyfus VIF International Value Investment Division................. 20,839 262,821 Fidelity VIP Asset Manager: Growth Investment Division................. 106,098 1,399,271 Fidelity VIP Contrafund Investment Division...... 77,404 1,882,528 Fidelity VIP Equity-Income Investment Division...... 1,442 31,058 Fidelity VIP Freedom 2010 Investment Division...... 3,760 39,012 Fidelity VIP Freedom 2020 Investment Division...... 77,535 646,439 Fidelity VIP Freedom 2025 Investment Division...... 3,093 36,556 Fidelity VIP Freedom 2030 Investment Division...... 4,831 50,474 FOR THE YEAR ENDED DECEMBER 31, --------------------------------------------------------------------------------- COST OF PROCEEDS PURCHASES ($) FROM SALES ($) --------------------------------------- ---------------------------------------- 2013 2012 2011 2013 2012 2011 ------------ ------------ ---------- ------------- ------------- ---------- AllianceBernstein Global Thematic Growth Investment Division...... 7,870 3,785 5,924,276 16,644 4,346,961 265,271 AllianceBernstein Intermediate Bond Investment Division...... 6,655 57,983 4,944 47,232 1,934 1,493 American Century VP Vista Investment Division...... 8 1,774 16,251 4,432 7,528 74,661 American Funds Bond Investment Division...... 1,038,371 1,312,217 969,816 587,559 763,603 731,112 American Funds Global Small Capitalization Investment Division...... 2,195,162 3,115,383 3,778,860 5,135,958 5,038,503 5,452,768 American Funds Growth Investment Division...... 3,805,307 3,746,471 5,600,915 11,132,333 10,752,272 8,870,119 American Funds Growth-Income Investment Division...... 3,196,534 2,947,311 3,518,169 6,413,846 5,517,911 3,636,760 American Funds High-Income Bond Investment Division...... 1,248 58,091(a) -- 41,307 189(a) -- American Funds International Investment Division................. 273,741 53,707 16,165 231,378 107,360 191,972 American Funds U.S. Government/AAA-Rated Securities Investment Division................. 6,097 7,935 24,616 1,780 7,421 18,298 Dreyfus VIF International Value Investment Division................. 4,196 5,777 5,544 5,015 2,581 6,265 Fidelity VIP Asset Manager: Growth Investment Division................. 141,995 564,188 201,611 548,689 229,156 542,259 Fidelity VIP Contrafund Investment Division...... 410,978 256,811 386,193 755,794 392,517 826,551 Fidelity VIP Equity-Income Investment Division...... 17,769 51,762 65,604 51,901 7,307 243,406 Fidelity VIP Freedom 2010 Investment Division...... 3,749 3,999 16,905 1,304 1,313 13,581 Fidelity VIP Freedom 2020 Investment Division...... 145,138 38,622 64,043 36,374 41,771 79,620 Fidelity VIP Freedom 2025 Investment Division...... 39,398(b) -- -- 2,977(b) -- -- Fidelity VIP Freedom 2030 Investment Division...... 30,075 2,517 33,098 19,207 23,108 83,225
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. 176 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY NOTES TO THE FINANCIAL STATEMENTS -- (CONTINUED) 6. STATEMENTS OF INVESTMENTS -- (CONTINUED)
AS OF DECEMBER 31, ------------------------- SHARES COST ($) ----------- ------------ 2013 2013 ----------- ------------ Fidelity VIP Freedom 2040 Investment Division..... 645 11,286 Fidelity VIP Freedom 2050 Investment Division..... 1,330 16,329 Fidelity VIP High Income Investment Division..... 28,964 171,010 Fidelity VIP Investment Grade Bond Investment Division................ 138,906 1,800,362 Fidelity VIP Mid Cap Investment Division..... 6,997 201,859 FTVIPT Franklin Income Securities Investment Division................ 38 610 FTVIPT Mutual Global Discovery Securities Investment Division..... 21,670 434,810 FTVIPT Mutual Shares Securities Investment Division................ 1,119 22,207 FTVIPT Templeton Foreign Securities Investment Division................ 250,894 3,554,438 FTVIPT Templeton Global Bond Securities Investment Division..... 68,810 1,309,081 Goldman Sachs Mid-Cap Value Investment Division................ 15,872 249,305 Goldman Sachs Structured Small Cap Equity Investment Division..... 2,752 34,075 Invesco V.I. Comstock Investment Division..... 17,832 210,728 Invesco V.I. Global Real Estate Investment Division................ 169,109 2,524,059 Invesco V.I. Government Securities Investment Division................ 955 11,543 Invesco V.I. International Growth Investment Division................ 11,302 360,970 Janus Aspen Balanced Investment Division..... 31,296 870,662 Janus Aspen Forty Investment Division..... 16,603 551,062 FOR THE YEAR ENDED DECEMBER 31, ------------------------------------------------------------------------------------ COST OF PROCEEDS PURCHASES ($) FROM SALES ($) ----------------------------------------- ----------------------------------------- 2013 2012 2011 2013 2012 2011 ------------ --------- ------------ ------------ ---------- ------------- Fidelity VIP Freedom 2040 Investment Division..... 11,359(c) -- -- 76(c) -- -- Fidelity VIP Freedom 2050 Investment Division..... 518 2,492 44,388(d) 489 302 25,362(d) Fidelity VIP High Income Investment Division..... 9,749 125,580 40,651 6,850 2,451 236 Fidelity VIP Investment Grade Bond Investment Division................ 1,222,120 1,921,672 1,807,611 1,702,641 1,407,822 593,778 Fidelity VIP Mid Cap Investment Division..... 36,720 173,748 287,684 710,324 67,376 86,070 FTVIPT Franklin Income Securities Investment Division................ 1,158(e) -- -- 551(e) -- -- FTVIPT Mutual Global Discovery Securities Investment Division..... 138,324 175,011 279,594 553,153 195,072 383,211 FTVIPT Mutual Shares Securities Investment Division................ 23,740(e) -- -- 1,637(e) -- -- FTVIPT Templeton Foreign Securities Investment Division................ 488,568 878,128 539,313 808,327 422,457 6,463,366 FTVIPT Templeton Global Bond Securities Investment Division..... 996,332 146,290 626,974 115,913 19,865 316,892 Goldman Sachs Mid-Cap Value Investment Division................ 60,380 2,932 58,548 75,921 57,554 130,799 Goldman Sachs Structured Small Cap Equity Investment Division..... 14,789 6,983 893 4,535 35,753 1,806 Invesco V.I. Comstock Investment Division..... 4,245 29,964 166,971 5,974 16,512 2,690 Invesco V.I. Global Real Estate Investment Division................ 676,333 1,031,105 1,144,072 671,338 364,719 1,047,754 Invesco V.I. Government Securities Investment Division................ 11,593 15,310 105,415(f) 357 36,465 86,648(f) Invesco V.I. International Growth Investment Division................ 347,644 6,090,412 11,463 6,733,613 311,291 236,029 Janus Aspen Balanced Investment Division..... 103,316 249,875 476,479 330,801 555,156 1,530,768 Janus Aspen Forty Investment Division..... 25,891 251,563 60,009 268,869 231,604 495,862
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. 177 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY NOTES TO THE FINANCIAL STATEMENTS -- (CONTINUED) 6. STATEMENTS OF INVESTMENTS -- (CONTINUED)
AS OF DECEMBER 31, ------------------------- SHARES COST ($) ----------- ------------ 2013 2013 ----------- ------------ Janus Aspen Janus Investment Division..... 12,845 254,740 Janus Aspen Overseas Investment Division..... 1,682 78,627 MFS VIT Global Equity Investment Division..... 9,703 140,477 MFS VIT New Discovery Investment Division..... 10,947 156,816 MFS VIT Value Investment Division..... 1,140 14,516 MFS VIT II High Yield Investment Division..... 24,052 147,086 MIST AllianceBernstein Global Dynamic Allocation Investment Division................ 2,982 32,684 MIST American Funds Balanced Allocation Investment Division..... 68,719 660,906 MIST American Funds Growth Allocation Investment Division..... 126,772 1,179,914 MIST American Funds Moderate Allocation Investment Division..... 78,539 787,960 MIST AQR Global Risk Balanced Investment Division..... 14,549 162,952 MIST BlackRock Global Tactical Strategies Investment Division..... 9,283 96,785 MIST BlackRock Large Cap Core Investment Division..... 29,964,444 320,016,887 MIST Clarion Global Real Estate Investment Division................ 2,469,642 29,074,818 MIST ClearBridge Aggressive Growth II Investment Division..... 187,379 12,939,421 MIST ClearBridge Aggressive Growth Investment Division..... 1,612,263 13,050,211 MIST Harris Oakmark International Investment Division................ 2,761,671 40,214,343 FOR THE YEAR ENDED DECEMBER 31, ------------------------------------------------------------------------------ COST OF PROCEEDS PURCHASES ($) FROM SALES ($) ------------------------------------ ---------------------------------------- 2013 2012 2011 2013 2012 2011 ------------ ---------- ---------- ------------ ------------- ----------- Janus Aspen Janus Investment Division..... 7,622 34,590 11,493 736,912 57,167 7,130,795 Janus Aspen Overseas Investment Division..... 17,811 114,730 5,940,358 430,241 18,736 5,664,163 MFS VIT Global Equity Investment Division..... 15,146 135,732 14,292 3,782 12,826 232,286 MFS VIT New Discovery Investment Division..... 1,726 42,794 24,020 10,583 4,661 4,419 MFS VIT Value Investment Division..... 274 1,023 36,464 1,372 33,595 67,428 MFS VIT II High Yield Investment Division..... 147,796(g) -- -- 707(g) -- -- MIST AllianceBernstein Global Dynamic Allocation Investment Division................ 33,068 8,989(h) -- 7,386 2,055(h) -- MIST American Funds Balanced Allocation Investment Division..... 136,505 111,688 225,636 46,230 50,779 119,833 MIST American Funds Growth Allocation Investment Division..... 596,532 211,211 237,080 241,084 178,743 112,650 MIST American Funds Moderate Allocation Investment Division..... 332,563 223,173 184,789 87,879 72,031 27,959 MIST AQR Global Risk Balanced Investment Division..... 202,173 30,767(h) -- 63,799 6,330(h) -- MIST BlackRock Global Tactical Strategies Investment Division..... 72,022 40,820(h) -- 13,676 2,670(h) -- MIST BlackRock Large Cap Core Investment Division..... 6,774,176 5,579,948 6,851,461 26,186,441 24,675,854 23,235,479 MIST Clarion Global Real Estate Investment Division................ 4,872,884 3,856,513 2,264,531 2,567,939 2,040,067 1,937,838 MIST ClearBridge Aggressive Growth II Investment Division..... 1,291,105 2,118,628 1,510,556 2,424,779 1,831,257 2,004,491 MIST ClearBridge Aggressive Growth Investment Division..... 2,383,159 770,047 5,893,574 1,442,150 1,188,432 1,236,188 MIST Harris Oakmark International Investment Division................ 12,366,501 2,666,808 2,500,638 3,801,502 3,615,172 2,457,952
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. 178 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY NOTES TO THE FINANCIAL STATEMENTS -- (CONTINUED) 6. STATEMENTS OF INVESTMENTS -- (CONTINUED)
AS OF DECEMBER 31, ------------------------ SHARES COST ($) ---------- ------------ 2013 2013 ---------- ------------ MIST Invesco Balanced-Risk Allocation Investment Division..... 2,337 24,602 MIST Invesco Mid Cap Value Investment Division................ 4,053,244 69,031,830 MIST Invesco Small Cap Growth Investment Division................ 323,001 4,548,426 MIST JPMorgan Small Cap Value Investment Division................ 12,785 222,102 MIST JPMorgan Global Active Allocation Investment Division..... 9,535 104,431 MIST Loomis Sayles Global Markets Investment Division..... 28,033 375,149 MIST Lord Abbett Bond Debenture Investment Division................ 2,149,388 25,939,114 MIST Met/Templeton International Bond Investment Division..... 7,404 85,733 MIST MetLife Aggressive Strategy Investment Division................ 1,431,944 14,975,275 MIST MetLife Balanced Plus Investment Division................ 7,960 87,787 MIST MetLife Growth Strategy Investment Division................ 27,089 331,338 MIST MetLife Multi-Index Targeted Risk Investment Division................ 238 2,627 MIST MFS Emerging Markets Equity Investment Division..... 26,310 270,506 MIST MFS Research International Investment Division................ 1,784,137 19,167,794 MIST Morgan Stanley Mid Cap Growth Investment Division..... 14,985,528 153,304,166 FOR THE YEAR ENDED DECEMBER 31, ------------------------------------------------------------------------------------ COST OF PROCEEDS PURCHASES ($) FROM SALES ($) ----------------------------------------- ----------------------------------------- 2013 2012 2011 2013 2012 2011 ---------- ------------ ------------- ------------ ------------ ------------- MIST Invesco Balanced-Risk Allocation Investment Division..... 28,473 9,936(h) -- 11,354 2,420(h) -- MIST Invesco Mid Cap Value Investment Division................ 1,498,456 76,386,802 17,623 5,791,979 4,011,220 3,264 MIST Invesco Small Cap Growth Investment Division................ 1,526,001 866,163 950,748 1,137,610 1,148,655 984,337 MIST JPMorgan Small Cap Value Investment Division................ 203,341 19,336 16,769 18,320 21,553 5,385 MIST JPMorgan Global Active Allocation Investment Division..... 133,918 21,306(h) -- 47,621 2,566(h) -- MIST Loomis Sayles Global Markets Investment Division..... 386,272(e) -- -- 11,829(e) -- -- MIST Lord Abbett Bond Debenture Investment Division................ 3,850,241 4,029,220 4,202,645 3,533,230 2,630,362 5,865,230 MIST Met/Templeton International Bond Investment Division..... 105,910 3,780(h) -- 22,711 1,243(h) -- MIST MetLife Aggressive Strategy Investment Division................ 1,755,615 1,631,765 15,450,469(f) 1,915,678 989,906 1,027,360(f) MIST MetLife Balanced Plus Investment Division................ 107,011 50,269(h) -- 66,151 6,146(h) -- MIST MetLife Growth Strategy Investment Division................ 367,648(e) -- -- 39,282(e) -- -- MIST MetLife Multi-Index Targeted Risk Investment Division................ 10,029(e) -- -- 7,161(e) -- -- MIST MFS Emerging Markets Equity Investment Division..... 203,989 153,279 26,770(f) 16,542 95,164 540(f) MIST MFS Research International Investment Division................ 4,346,021 3,674,489 2,576,414 1,625,675 1,969,844 2,605,812 MIST Morgan Stanley Mid Cap Growth Investment Division..... 3,506,234 4,192,041 9,829,634 14,826,330 13,094,724 16,285,234
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. 179 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY NOTES TO THE FINANCIAL STATEMENTS -- (CONTINUED) 6. STATEMENTS OF INVESTMENTS -- (CONTINUED)
AS OF DECEMBER 31, ------------------------ SHARES COST ($) ---------- ------------ 2013 2013 ---------- ------------ MIST Oppenheimer Global Equity Investment Division..... 2,435,460 31,885,200 MIST PIMCO Inflation Protected Bond Investment Division..... 1,126,985 12,624,414 MIST PIMCO Total Return Investment Division..... 4,209,162 49,845,188 MIST Pioneer Fund Investment Division..... 10,945 114,196 MIST Pyramis Managed Risk Investment Division................ 28 292 MIST Schroders Global Multi-Asset Investment Division................ 1,959 21,190 MIST SSgA Growth and Income ETF Investment Division................ 603,061 6,749,848 MIST SSgA Growth ETF Investment Division..... 429,801 4,634,710 MIST T. Rowe Price Large Cap Value Investment Division................ 63,017 1,576,375 MIST T. Rowe Price Mid Cap Growth Investment Division..... 2,258,497 19,397,797 MIST Third Avenue Small Cap Value Investment Division..... 45,851 655,053 MSF Baillie Gifford International Stock Investment Division..... 4,255,819 47,231,220 MSF Barclays Capital Aggregate Bond Index Investment Division..... 11,109,226 121,743,230 MSF BlackRock Bond Income Investment Division................ 757,009 81,385,099 MSF BlackRock Capital Appreciation Investment Division................ 551,656 14,218,107 MSF BlackRock Diversified Investment Division................ 14,706,758 237,239,102 FOR THE YEAR ENDED DECEMBER 31, ------------------------------------------------------------------------------ COST OF PROCEEDS PURCHASES ($) FROM SALES ($) -------------------------------------- -------------------------------------- 2013 2012 2011 2013 2012 2011 ------------ ------------ ---------- ------------ ------------ ---------- MIST Oppenheimer Global Equity Investment Division..... 2,321,885 1,995,431 4,561,354 3,889,775 4,751,183 6,449,346 MIST PIMCO Inflation Protected Bond Investment Division..... 2,836,674 4,918,545 3,303,438 3,102,046 1,739,898 2,028,482 MIST PIMCO Total Return Investment Division..... 9,342,752 6,325,271 7,403,802 5,838,413 5,836,729 5,653,299 MIST Pioneer Fund Investment Division..... 7,882 7,582 7,780 47,925 4,551 67,759 MIST Pyramis Managed Risk Investment Division................ 292(e) -- -- --(e) -- -- MIST Schroders Global Multi-Asset Investment Division................ 20,776 8,021(h) -- 5,512 2,255(h) -- MIST SSgA Growth and Income ETF Investment Division................ 1,997,849 1,824,928 1,498,489 859,987 688,031 604,376 MIST SSgA Growth ETF Investment Division..... 1,446,527 1,113,746 1,923,928 671,592 500,843 1,172,938 MIST T. Rowe Price Large Cap Value Investment Division................ 420,793 76,536 25,689 193,933 17,219 5,307,279 MIST T. Rowe Price Mid Cap Growth Investment Division..... 3,029,264 3,759,855 8,275,848 2,799,197 7,974,926 2,781,426 MIST Third Avenue Small Cap Value Investment Division..... 63,430 126,084 595,096 233,699 192,017 1,211,039 MSF Baillie Gifford International Stock Investment Division..... 2,118,267 2,184,026 3,235,087 3,108,949 4,015,643 3,373,752 MSF Barclays Capital Aggregate Bond Index Investment Division..... 20,021,956 18,934,907 11,501,288 8,161,697 11,439,455 21,342,034 MSF BlackRock Bond Income Investment Division................ 8,070,467 5,640,825 5,805,876 6,400,153 7,542,088 8,666,314 MSF BlackRock Capital Appreciation Investment Division................ 3,327,801 7,158,245 2,393,555 1,550,635 2,120,133 1,606,886 MSF BlackRock Diversified Investment Division................ 9,203,469 8,590,251 10,350,108 19,565,615 21,948,665 21,365,154
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. 180 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY NOTES TO THE FINANCIAL STATEMENTS -- (CONTINUED) 6. STATEMENTS OF INVESTMENTS -- (CONTINUED)
AS OF DECEMBER 31, FOR THE YEAR ENDED DECEMBER 31, ------------------------ ------------------------------------------------------------------------- COST OF PROCEEDS SHARES COST ($) PURCHASES ($) FROM SALES ($) ---------- ------------ ----------------------------------- ----------------------------------- 2013 2013 2013 2012 2011 2013 2012 2011 ---------- ------------ ---------- ---------- ---------- ---------- ---------- ---------- MSF BlackRock Large Cap Value Investment Division............... 1,535,572 16,567,153 2,342,311 3,386,813 1,424,125 1,620,473 1,826,005 1,183,780 MSF BlackRock Money Market Investment Division............... 237,819 23,781,884 8,919,408 13,187,844 11,412,230 8,411,979 10,707,190 20,447,498 MSF Davis Venture Value Investment Division.... 1,692,569 47,415,753 3,803,213 2,240,132 4,062,485 6,337,042 3,984,624 5,416,410 MSF Frontier Mid Cap Growth Investment Division............... 6,178,153 144,884,748 8,476,019 2,359,607 8,269,136 22,525,722 16,639,363 17,101,074 MSF Jennison Growth Investment Division.... 1,375,104 15,415,568 913,517 5,678,348 1,020,376 2,926,328 1,525,681 2,289,730 MSF Loomis Sayles Small Cap Core Investment Division.... 77,520 16,380,796 2,698,843 1,244,281 1,401,272 2,319,697 1,870,414 2,332,479 MSF Loomis Sayles Small Cap Growth Investment Division.... 733,333 7,321,932 1,502,732 435,159 1,535,720 1,369,444 1,390,992 1,011,621 MSF Met/Artisan Mid Cap Value Investment Division.... 240,575 49,230,865 1,897,264 1,652,342 2,136,634 4,831,177 3,672,223 4,226,880 MSF MetLife Conservative Allocation Investment Division............... 428,259 4,839,598 1,016,919 1,835,676 1,806,198 1,287,364 1,004,176 1,511,348 MSF MetLife Conservative to Moderate Allocation Investment Division.... 716,981 7,995,503 1,722,153 2,243,025 1,953,282 1,719,216 731,687 2,239,776 MSF MetLife Mid Cap Stock Index Investment Division............... 5,209,362 66,643,830 13,448,733 6,434,902 7,118,449 7,654,195 6,851,251 5,790,251 MSF MetLife Moderate Allocation Investment Division............... 3,742,439 40,166,495 5,705,492 5,656,884 6,621,830 6,533,709 4,063,798 3,119,932 MSF MetLife Moderate to Aggressive Allocation Investment Division.... 6,499,539 69,742,286 7,738,825 7,501,562 8,856,018 8,434,282 5,594,631 4,089,610 MSF MetLife Stock Index Investment Division.... 21,753,279 662,656,025 44,934,052 41,740,053 42,140,081 61,796,495 56,539,432 42,862,666 MSF MFS Total Return Investment Division.... 58,856 7,947,718 938,490 1,197,544 1,189,902 830,981 1,043,992 1,494,750 MSF MFS Value Investment Division............... 4,725,766 62,181,707 13,685,105 3,310,186 3,888,301 6,070,278 4,486,581 5,180,543 MSF MSCI EAFE Index Investment Division.... 5,859,932 65,024,022 7,260,878 7,247,918 9,375,469 7,024,358 7,865,571 5,508,673
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. 181 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY NOTES TO THE FINANCIAL STATEMENTS -- (CONTINUED) 6. STATEMENTS OF INVESTMENTS -- (CONCLUDED)
AS OF DECEMBER 31, ------------------------- SHARES COST ($) ----------- ------------ 2013 2013 ----------- ------------ MSF Neuberger Berman Genesis Investment Division................. 6,231,068 89,502,562 MSF Russell 2000 Index Investment Division...... 3,642,566 43,690,487 MSF T. Rowe Price Large Cap Growth Investment Division................. 3,277,100 45,589,605 MSF T. Rowe Price Small Cap Growth Investment Division................. 5,270,376 71,654,015 MSF Van Eck Global Natural Resources Investment Division...... 11,989 160,661 MSF Western Asset Management Strategic Bond Opportunities Investment Division...... 1,885,981 23,372,761 MSF Western Asset Management U.S. Government Investment Division................. 1,373,376 16,617,063 PIMCO VIT All Asset Investment Division...... 84,954 941,277 PIMCO VIT Commodity Real Return Strategy Investment Division...... 967 5,909 PIMCO VIT Low Duration Investment Division...... 148,125 1,551,518 Pioneer VCT Emerging Markets Investment Division................. 10,867 261,397 Pioneer VCT Mid Cap Value Investment Division...... 2,175 33,678 Putnam VT International Value Investment Division................. 581 5,951 Royce Micro-Cap Investment Division...... 605 6,212 Royce Small-Cap Investment Division...... 49,492 542,288 UIF Emerging Markets Debt Investment Division...... 141,121 1,250,999 UIF Emerging Markets Equity Investment Division...... 84,170 1,195,117 Wells Fargo VT Total Return Bond Investment Division................. 25,568 270,900 FOR THE YEAR ENDED DECEMBER 31, ------------------------------------------------------------------------------------ COST OF PROCEEDS PURCHASES ($) FROM SALES ($) ----------------------------------------- ----------------------------------------- 2013 2012 2011 2013 2012 2011 ------------- ---------- ------------- ------------- ---------- ------------ MSF Neuberger Berman Genesis Investment Division................. 7,027,531 1,372,639 2,070,471 7,742,991 5,678,800 5,494,730 MSF Russell 2000 Index Investment Division...... 3,029,528 2,536,084 4,574,342 6,463,070 5,292,336 7,433,659 MSF T. Rowe Price Large Cap Growth Investment Division................. 15,736,961 2,729,462 2,728,837 6,944,037 3,564,278 5,712,444 MSF T. Rowe Price Small Cap Growth Investment Division................. 9,391,866 12,017,765 6,480,374 11,430,616 10,094,477 9,130,453 MSF Van Eck Global Natural Resources Investment Division...... 114,120 52,989 15,766(f) 11,294 9,747 344(f) MSF Western Asset Management Strategic Bond Opportunities Investment Division...... 3,018,642 2,398,460 2,218,805 2,127,409 2,267,683 2,678,776 MSF Western Asset Management U.S. Government Investment Division................. 1,874,177 1,529,728 1,868,479 1,529,016 1,548,704 2,143,284 PIMCO VIT All Asset Investment Division...... 919,742 31,250 97,359(f) 102,137 4,536 --(f) PIMCO VIT Commodity Real Return Strategy Investment Division...... 6,189(e) -- -- 275(e) -- -- PIMCO VIT Low Duration Investment Division...... 932,742 47,764 210,299 317,710 43,068 21,217 Pioneer VCT Emerging Markets Investment Division................. 85,122 511,183 461,977 472,102 259,048 837,851 Pioneer VCT Mid Cap Value Investment Division...... 425 13,669 52,297 131,940 7,978 6,022 Putnam VT International Value Investment Division................. 6,233(b) -- -- 293(b) -- -- Royce Micro-Cap Investment Division...... 2,118 56,398 22,196 429,932 11,535 9,860 Royce Small-Cap Investment Division...... 226,942 194,261 1,012,962 224,586 463,815 605,050 UIF Emerging Markets Debt Investment Division...... 271,301 734,902 432,895 107,779 65,546 19,721 UIF Emerging Markets Equity Investment Division...... 399,267 423,867 657,354 165,296 68,649 220,179 Wells Fargo VT Total Return Bond Investment Division................. 59,791 435,287 134,983 270,977 88,422 1,089,695
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. 182 This page is intentionally left blank. METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY NOTES TO THE FINANCIAL STATEMENTS -- (CONTINUED) 7. SCHEDULES OF UNITS FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011:
ALLIANCEBERNSTEIN GLOBAL THEMATIC GROWTH INVESTMENT DIVISION -------------------------------------------------------- 2013 2012 2011 ----------------- ------------------ ----------------- Units beginning of year.... 11,630 914,212 19,486 Units issued and transferred from other funding options......... 1,489 797 943,623 Units redeemed and transferred to other funding options......... (2,998) (903,379) (48,897) ----------------- ------------------ ----------------- Units end of year.......... 10,121 11,630 914,212 ================= ================== ================= ALLIANCEBERNSTEIN INTERMEDIATE BOND INVESTMENT DIVISION ------------------------------------------------------- 2013 2012 2011 ----------------- ----------------- ----------------- Units beginning of year.... 6,675 3,232 3,146 Units issued and transferred from other funding options......... 219 3,563 191 Units redeemed and transferred to other funding options......... (3,082) (120) (105) ----------------- ----------------- ----------------- Units end of year.......... 3,812 6,675 3,232 ================= ================= ================= AMERICAN CENTURY VP VISTA INVESTMENT DIVISION -------------------------------------------------------- 2013 2012 2011 ----------------- ------------------ ----------------- Units beginning of year.... 279 679 5,360 Units issued and transferred from other funding options......... -- 63 753 Units redeemed and transferred to other funding options......... (242) (463) (5,434) ----------------- ------------------ ----------------- Units end of year.......... 37 279 679 ================= ================== ================= AMERICAN FUNDS BOND INVESTMENT DIVISION -------------------------------------------------------- 2013 2012 2011 ----------------- ------------------ ----------------- Units beginning of year.... 397,946 367,699 361,073 Units issued and transferred from other funding options......... 106,636 131,998 111,528 Units redeemed and transferred to other funding options......... (87,581) (101,751) (104,902) ----------------- ------------------ ----------------- Units end of year.......... 417,001 397,946 367,699 ================= ================== =================
AMERICAN FUNDS GLOBAL SMALL CAPITALIZATION INVESTMENT DIVISION ------------------------------------------------------- 2013 2012 2011 ----------------- ----------------- ----------------- Units beginning of year.... 1,947,587 2,037,588 2,114,920 Units issued and transferred from other funding options......... 249,505 343,427 395,698 Units redeemed and transferred to other funding options......... (348,852) (433,428) (473,030) ----------------- ----------------- ----------------- Units end of year.......... 1,848,240 1,947,587 2,037,588 ================= ================= ================= AMERICAN FUNDS GROWTH INVESTMENT DIVISION ------------------------------------------------------- 2013 2012 2011 ----------------- ----------------- ----------------- Units beginning of year.... 1,269,410 1,353,057 1,411,108 Units issued and transferred from other funding options......... 145,646 191,289 236,308 Units redeemed and transferred to other funding options......... (230,258) (274,936) (294,359) ----------------- ----------------- ----------------- Units end of year.......... 1,184,798 1,269,410 1,353,057 ================= ================= ================= AMERICAN FUNDS GROWTH-INCOME AMERICAN FUNDS HIGH-INCOME BOND INVESTMENT DIVISION INVESTMENT DIVISION ------------------------------------------------------ ------------------------------------ 2013 2012 2011 2013 2012 (a) ----------------- ---------------- ----------------- ----------------- ----------------- Units beginning of year.... 1,382,116 1,453,945 1,483,095 4,606 -- Units issued and transferred from other funding options......... 173,179 212,605 249,184 18 4,621 Units redeemed and transferred to other funding options......... (240,034) (284,434) (278,334) (3,299) (15) ----------------- ---------------- ----------------- ----------------- ----------------- Units end of year.......... 1,315,261 1,382,116 1,453,945 1,325 4,606 ================= ================ ================= ================= =================
AMERICAN FUNDS INTERNATIONAL INVESTMENT DIVISION --------------------------------------------------------- 2013 2012 2011 ------------------ ----------------- ------------------ Units beginning of year.... 18,773 21,039 27,930 Units issued and transferred from other funding options......... 7,789 1,746 306 Units redeemed and transferred to other funding options......... (7,400) (4,012) (7,197) ------------------ ----------------- ------------------ Units end of year.......... 19,162 18,773 21,039 ================== ================= ================== AMERICAN FUNDS U.S. GOVERNMENT/ AAA-RATED SECURITIES INVESTMENT DIVISION -------------------------------------------------------- 2013 2012 2011 ----------------- ----------------- ------------------ Units beginning of year.... 1,972 2,025 1,810 Units issued and transferred from other funding options......... 220 292 1,074 Units redeemed and transferred to other funding options......... (99) (345) (859) ----------------- ----------------- ------------------ Units end of year.......... 2,093 1,972 2,025 ================= ================= ================== DREYFUS VIF INTERNATIONAL VALUE INVESTMENT DIVISION ------------------------------------------------------- 2013 2012 2011 ----------------- ----------------- ----------------- Units beginning of year.... 16,013 16,153 16,502 Units issued and transferred from other funding options......... 11 77 99 Units redeemed and transferred to other funding options......... (352) (217) (448) ----------------- ----------------- ----------------- Units end of year.......... 15,672 16,013 16,153 ================= ================= ================= FIDELITY VIP ASSET MANAGER: GROWTH INVESTMENT DIVISION -------------------------------------------------------- 2013 2012 2011 ----------------- ------------------ ----------------- Units beginning of year.... 164,596 138,116 172,460 Units issued and transferred from other funding options......... 11,097 47,327 17,093 Units redeemed and transferred to other funding options......... (43,635) (20,847) (51,437) ----------------- ------------------ ----------------- Units end of year.......... 132,058 164,596 138,116 ================= ================== =================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. 184 185 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY NOTES TO THE FINANCIAL STATEMENTS -- (CONTINUED) 7. SCHEDULES OF UNITS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011:
FIDELITY VIP CONTRAFUND INVESTMENT DIVISION --------------------------------------------------------- 2013 2012 2011 ----------------- ------------------ ------------------ Units beginning of year.... 147,414 157,450 190,755 Units issued and transferred from other funding options......... 9,977 16,403 22,512 Units redeemed and transferred to other funding options......... (41,606) (26,439) (55,817) ----------------- ------------------ ------------------ Units end of year.......... 115,785 147,414 157,450 ================= ================== ================== FIDELITY VIP EQUITY-INCOME INVESTMENT DIVISION --------------------------------------------------------- 2013 2012 2011 ------------------ ----------------- ------------------ Units beginning of year.... 4,431 1,549 17,040 Units issued and transferred from other funding options......... 860 3,462 2,435 Units redeemed and transferred to other funding options......... (3,474) (580) (17,926) ------------------ ----------------- ------------------ Units end of year.......... 1,817 4,431 1,549 ================== ================= ================== FIDELITY VIP FREEDOM 2010 INVESTMENT DIVISION --------------------------------------------------------- 2013 2012 2011 ------------------ ----------------- ------------------ Units beginning of year.... 3,378 3,238 3,002 Units issued and transferred from other funding options......... 118 200 246 Units redeemed and transferred to other funding options......... (8) (60) (10) ------------------ ----------------- ------------------ Units end of year.......... 3,488 3,378 3,238 ================== ================= ================== FIDELITY VIP FREEDOM 2020 INVESTMENT DIVISION -------------------------------------------------------- 2013 2012 2011 ------------------ ----------------- ----------------- Units beginning of year.... 51,279 53,514 56,297 Units issued and transferred from other funding options......... 9,018 968 121 Units redeemed and transferred to other funding options......... (1,710) (3,203) (2,904) ------------------ ----------------- ----------------- Units end of year.......... 58,587 51,279 53,514 ================== ================= =================
FIDELITY VIP FIDELITY VIP FREEDOM 2025 FIDELITY VIP FREEDOM 2030 FREEDOM 2040 INVESTMENT DIVISION INVESTMENT DIVISION INVESTMENT DIVISION ------------------- ---------------------------------------------------------- ------------------- 2013 (b) 2013 2012 2011 2013 (c) ------------------- ------------------ ------------------ ------------------ ------------------- Units beginning of year.... -- 3,939 6,028 9,011 -- Units issued and transferred from other funding options......... 2,321 811 83 2,929 784 Units redeemed and transferred to other funding options......... (172) (41) (2,172) (5,912) (2) ------------------- ------------------ ------------------ ------------------ ------------------- Units end of year.......... 2,149 4,709 3,939 6,028 782 =================== ================== ================== ================== =================== FIDELITY VIP FREEDOM 2050 INVESTMENT DIVISION ---------------------------------------------------------- 2013 2012 2011 (d) ------------------ ------------------ ------------------ Units beginning of year.... 1,468 1,492 -- Units issued and transferred from other funding options......... 1 -- 1,494 Units redeemed and transferred to other funding options......... (25) (24) (2) ------------------ ------------------ ------------------ Units end of year.......... 1,444 1,468 1,492 ================== ================== ================== FIDELITY VIP HIGH INCOME INVESTMENT DIVISION --------------------------------------------------------- 2013 2012 2011 ------------------ ------------------ ----------------- Units beginning of year.... 8,955 2,677 294 Units issued and transferred from other funding options......... 4 6,418 2,406 Units redeemed and transferred to other funding options......... (361) (140) (23) ------------------ ------------------ ----------------- Units end of year.......... 8,598 8,955 2,677 ================== ================== =================
FIDELITY VIP INVESTMENT GRADE BOND INVESTMENT DIVISION -------------------------------------------------------- 2013 2012 2011 ----------------- ------------------ ----------------- Units beginning of year.... 144,729 117,053 38,436 Units issued and transferred from other funding options......... 74,632 117,701 120,433 Units redeemed and transferred to other funding options......... (109,636) (90,025) (41,816) ----------------- ------------------ ----------------- Units end of year.......... 109,725 144,729 117,053 ================= ================== ================= FTVIPT FRANKLIN INCOME FIDELITY VIP MID CAP SECURITIES INVESTMENT DIVISION INVESTMENT DIVISION --------------------------------------------------------- ------------------- 2013 2012 2011 2013 (e) ------------------ ------------------ ----------------- ------------------- Units beginning of year.... 26,557 24,942 16,733 -- Units issued and transferred from other funding options......... 46 4,204 12,194 1 Units redeemed and transferred to other funding options......... (20,102) (2,589) (3,985) -- ------------------ ------------------ ----------------- ------------------- Units end of year.......... 6,501 26,557 24,942 1 ================== ================== ================= =================== FTVIPT MUTUAL SHARES FTVIPT MUTUAL GLOBAL DISCOVERY SECURITIES SECURITIES INVESTMENT DIVISION INVESTMENT DIVISION -------------------------------------------------------- ------------------- 2013 2012 2011 2013 (e) ----------------- ------------------ ----------------- ------------------- Units beginning of year.... 40,339 44,626 53,444 -- Units issued and transferred from other funding options......... 1,707 6,077 9,519 72 Units redeemed and transferred to other funding options......... (22,567) (10,364) (18,337) (5) ----------------- ------------------ ----------------- ------------------- Units end of year.......... 19,479 40,339 44,626 67 ================= ================== ================= ===================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. 186 187 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY NOTES TO THE FINANCIAL STATEMENTS -- (CONTINUED) 7. SCHEDULES OF UNITS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011:
FTVIPT TEMPLETON FOREIGN SECURITIES INVESTMENT DIVISION ------------------------------------------------------- 2013 2012 2011 ----------------- ----------------- ----------------- Units beginning of year.... 225,312 203,775 558,309 Units issued and transferred from other funding options......... 22,322 49,290 26,853 Units redeemed and transferred to other funding options......... (44,414) (27,753) (381,387) ----------------- ----------------- ----------------- Units end of year.......... 203,220 225,312 203,775 ================= ================= ================= FTVIPT TEMPLETON GLOBAL BOND SECURITIES INVESTMENT DIVISION --------------------------------------------------------- 2013 2012 2011 ----------------- ------------------ ------------------ Units beginning of year.... 18,556 14,004 179 Units issued and transferred from other funding options......... 40,703 5,493 25,202 Units redeemed and transferred to other funding options......... (4,976) (941) (11,377) ----------------- ------------------ ------------------ Units end of year.......... 54,283 18,556 14,004 ================= ================== ================== GOLDMAN SACHS MID-CAP VALUE INVESTMENT DIVISION ------------------------------------------------------- 2013 2012 2011 ----------------- ----------------- ----------------- Units beginning of year.... 15,625 19,234 24,643 Units issued and transferred from other funding options......... -- -- -- Units redeemed and transferred to other funding options......... (3,835) (3,609) (5,409) ----------------- ----------------- ----------------- Units end of year.......... 11,790 15,625 19,234 ================= ================= ================= GOLDMAN SACHS STRUCTURED SMALL CAP EQUITY INVESTMENT DIVISION ------------------------------------------------------- 2013 2012 2011 ----------------- ----------------- ----------------- Units beginning of year.... 1,925 4,148 4,258 Units issued and transferred from other funding options......... 460 435 38 Units redeemed and transferred to other funding options......... (271) (2,658) (148) ----------------- ----------------- ----------------- Units end of year.......... 2,114 1,925 4,148 ================= ================= =================
INVESCO V.I. COMSTOCK INVESTMENT DIVISION ----------------------------------------------------------- 2013 2012 2011 ------------------ ------------------ ------------------- Units beginning of year.... 18,847 17,951 2,966 Units issued and transferred from other funding options......... 11 2,259 15,242 Units redeemed and transferred to other funding options......... (400) (1,363) (257) ------------------ ------------------ ------------------- Units end of year.......... 18,458 18,847 17,951 ================== ================== =================== INVESCO V.I. GLOBAL REAL ESTATE INVESTMENT DIVISION ----------------------------------------------------------- 2013 2012 2011 ------------------ ------------------- ------------------ Units beginning of year.... 73,934 54,002 54,093 Units issued and transferred from other funding options......... 9,172 31,822 34,742 Units redeemed and transferred to other funding options......... (17,404) (11,890) (34,833) ------------------ ------------------- ------------------ Units end of year.......... 65,702 73,934 54,002 ================== =================== ================== INVESCO V.I. GOVERNMENT SECURITIES INVESTMENT DIVISION ---------------------------------------------------------- 2013 2012 2011 (f) ------------------ ------------------ ------------------ Units beginning of year.... 22 1,570 -- Units issued and transferred from other funding options......... 820 1,091 8,213 Units redeemed and transferred to other funding options......... (32) (2,639) (6,643) ------------------ ------------------ ------------------ Units end of year.......... 810 22 1,570 ================== ================== ================== INVESCO V.I. INTERNATIONAL GROWTH INVESTMENT DIVISION ---------------------------------------------------------- 2013 2012 2011 ------------------ ------------------ ------------------ Units beginning of year.... 314,797 1,308 14,201 Units issued and transferred from other funding options......... 15,364 329,534 320 Units redeemed and transferred to other funding options......... (313,932) (16,045) (13,213) ------------------ ------------------ ------------------ Units end of year.......... 16,229 314,797 1,308 ================== ================== ==================
JANUS ASPEN BALANCED INVESTMENT DIVISION --------------------------------------------------------- 2013 2012 2011 ------------------ ----------------- ------------------ Units beginning of year.... 59,065 81,522 155,834 Units issued and transferred from other funding options......... 1,895 9,247 8,172 Units redeemed and transferred to other funding options......... (16,489) (31,704) (82,484) ------------------ ----------------- ------------------ Units end of year.......... 44,471 59,065 81,522 ================== ================= ================== JANUS ASPEN FORTY INVESTMENT DIVISION ------------------------------------------------------- 2013 2012 2011 ----------------- ----------------- ----------------- Units beginning of year.... 46,505 45,616 73,218 Units issued and transferred from other funding options......... 1,234 13,757 4,044 Units redeemed and transferred to other funding options......... (12,922) (12,868) (31,646) ----------------- ----------------- ----------------- Units end of year.......... 34,817 46,505 45,616 ================= ================= ================= JANUS ASPEN JANUS INVESTMENT DIVISION --------------------------------------------------------- 2013 2012 2011 ------------------ ----------------- ------------------ Units beginning of year.... 81,921 85,791 741,523 Units issued and transferred from other funding options......... 121 1,271 640 Units redeemed and transferred to other funding options......... (53,627) (5,141) (656,372) ------------------ ----------------- ------------------ Units end of year.......... 28,415 81,921 85,791 ================== ================= ================== JANUS ASPEN OVERSEAS INVESTMENT DIVISION -------------------------------------------------------- 2013 2012 2011 ----------------- ------------------ ----------------- Units beginning of year.... 17,627 15,536 11,481 Units issued and transferred from other funding options......... 228 3,116 181,594 Units redeemed and transferred to other funding options......... (15,452) (1,025) (177,539) ----------------- ------------------ ----------------- Units end of year.......... 2,403 17,627 15,536 ================= ================== =================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. 188 189 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY NOTES TO THE FINANCIAL STATEMENTS -- (CONTINUED) 7. SCHEDULES OF UNITS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011:
MFS VIT GLOBAL EQUITY INVESTMENT DIVISION -------------------------------------------------------- 2013 2012 2011 ----------------- ------------------ ----------------- Units beginning of year.... 7,233 356 14,222 Units issued and transferred from other funding options......... 716 7,683 851 Units redeemed and transferred to other funding options......... (188) (806) (14,717) ----------------- ------------------ ----------------- Units end of year.......... 7,761 7,233 356 ================= ================== ================= MFS VIT NEW DISCOVERY INVESTMENT DIVISION --------------------------------------------------------- 2013 2012 2011 ----------------- ------------------ ------------------ Units beginning of year.... 9,204 7,919 7,814 Units issued and transferred from other funding options......... -- 1,553 359 Units redeemed and transferred to other funding options......... (483) (268) (254) ----------------- ------------------ ------------------ Units end of year.......... 8,721 9,204 7,919 ================= ================== ================== MFS VIT II MFS VIT VALUE HIGH YIELD INVESTMENT DIVISION INVESTMENT DIVISION -------------------------------------------------------- ------------------- 2013 2012 2011 2013 (g) ----------------- ----------------- ------------------ ------------------- Units beginning of year.... 1,049 3,138 5,577 -- Units issued and transferred from other funding options......... 1 -- -- 8,117 Units redeemed and transferred to other funding options......... (72) (2,089) (2,439) (42) ----------------- ----------------- ------------------ ------------------- Units end of year.......... 978 1,049 3,138 8,075 ================= ================= ================== =================== MIST ALLIANCEBERNSTEIN GLOBAL DYNAMIC ALLOCATION INVESTMENT DIVISION ------------------------------------ 2013 2012 (h) ----------------- ----------------- Units beginning of year.... 656 -- Units issued and transferred from other funding options......... 2,831 852 Units redeemed and transferred to other funding options......... (640) (196) ----------------- ----------------- Units end of year.......... 2,847 656 ================= =================
MIST AMERICAN FUNDS BALANCED ALLOCATION INVESTMENT DIVISION ------------------------------------------------------- 2013 2012 2011 ----------------- ----------------- ----------------- Units beginning of year.... 54,591 50,766 41,296 Units issued and transferred from other funding options......... 6,481 8,491 21,131 Units redeemed and transferred to other funding options......... (3,614) (4,666) (11,661) ----------------- ----------------- ----------------- Units end of year.......... 57,458 54,591 50,766 ================= ================= ================= MIST AMERICAN FUNDS GROWTH ALLOCATION INVESTMENT DIVISION ------------------------------------------------------- 2013 2012 2011 ----------------- ----------------- ----------------- Units beginning of year.... 84,318 82,817 71,574 Units issued and transferred from other funding options......... 43,545 19,200 22,942 Units redeemed and transferred to other funding options......... (19,761) (17,699) (11,699) ----------------- ----------------- ----------------- Units end of year.......... 108,102 84,318 82,817 ================= ================= ================= MIST AMERICAN FUNDS MODERATE ALLOCATION MIST AQR GLOBAL RISK BALANCED INVESTMENT DIVISION INVESTMENT DIVISION ------------------------------------------------------- ------------------------------------ 2013 2012 2011 2013 2012 (h) ----------------- ----------------- ----------------- ----------------- ----------------- Units beginning of year.... 49,584 37,706 23,584 2,358 -- Units issued and transferred from other funding options......... 22,287 18,239 16,729 18,647 2,974 Units redeemed and transferred to other funding options......... (6,976) (6,361) (2,607) (5,946) (616) ----------------- ----------------- ----------------- ----------------- ----------------- Units end of year.......... 64,895 49,584 37,706 15,059 2,358 ================= ================= ================= ================= =================
MIST BLACKROCK GLOBAL TACTICAL STRATEGIES MIST BLACKROCK LARGE CAP CORE INVESTMENT DIVISION INVESTMENT DIVISION ------------------------------------- -------------------------------------------------------- 2013 2012 (h) 2013 2012 2011 ----------------- ------------------ ----------------- ----------------- ------------------ Units beginning of year..... 3,707 -- 11,913,338 12,762,727 13,468,383 Units issued and transferred from other funding options.......... 6,344 3,964 1,167,810 1,483,936 1,797,760 Units redeemed and transferred to other funding options.......... (1,230) (257) (1,896,316) (2,333,325) (2,503,416) ----------------- ------------------ ----------------- ----------------- ------------------ Units end of year........... 8,821 3,707 11,184,832 11,913,338 12,762,727 ================= ================== ================= ================= ================== MIST CLARION GLOBAL REAL ESTATE INVESTMENT DIVISION -------------------------------------------------------- 2013 2012 2011 ------------------ ----------------- ----------------- Units beginning of year..... 1,388,419 1,311,823 1,342,988 Units issued and transferred from other funding options.......... 302,475 371,416 277,732 Units redeemed and transferred to other funding options.......... (278,225) (294,820) (308,897) ------------------ ----------------- ----------------- Units end of year........... 1,412,669 1,388,419 1,311,823 ================== ================= ================= MIST CLEARBRIDGE AGGRESSIVE GROWTH II INVESTMENT DIVISION -------------------------------------------------------- 2013 2012 2011 ----------------- ------------------ ----------------- Units beginning of year..... 1,085,660 1,093,634 1,185,626 Units issued and transferred from other funding options.......... 178,832 286,818 250,215 Units redeemed and transferred to other funding options.......... (256,271) (294,792) (342,207) ----------------- ------------------ ----------------- Units end of year........... 1,008,221 1,085,660 1,093,634 ================= ================== =================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. 190 191 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY NOTES TO THE FINANCIAL STATEMENTS -- (CONTINUED) 7. SCHEDULES OF UNITS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011:
MIST CLEARBRIDGE AGGRESSIVE GROWTH INVESTMENT DIVISION ------------------------------------------------------- 2013 2012 2011 ----------------- ----------------- ----------------- Units beginning of year.... 1,313,742 1,353,551 888,257 Units issued and transferred from other funding options......... 313,509 230,917 760,794 Units redeemed and transferred to other funding options......... (251,506) (270,726) (295,500) ----------------- ----------------- ----------------- Units end of year.......... 1,375,745 1,313,742 1,353,551 ================= ================= ================= MIST INVESCO MIST HARRIS OAKMARK INTERNATIONAL BALANCED-RISK ALLOCATION INVESTMENT DIVISION INVESTMENT DIVISION -------------------------------------------------------- ------------------------------------ 2013 2012 2011 2013 2012 (h) ------------------ ----------------- ----------------- ----------------- ----------------- Units beginning of year.... 1,421,965 1,483,192 1,473,309 7,100 -- Units issued and transferred from other funding options......... 863,606 301,420 324,563 26,433 9,427 Units redeemed and transferred to other funding options......... (304,727) (362,647) (314,680) (10,595) (2,327) ------------------ ----------------- ----------------- ----------------- ----------------- Units end of year.......... 1,980,844 1,421,965 1,483,192 22,938 7,100 ================== ================= ================= ================= ================= MIST INVESCO MID CAP VALUE INVESTMENT DIVISION --------------------------------------------------------- 2013 2012 2011 ----------------- ------------------ ------------------ Units beginning of year.... 2,873,152 9,000 7,974 Units issued and transferred from other funding options......... 304,764 3,301,144 1,279 Units redeemed and transferred to other funding options......... (470,475) (436,992) (253) ----------------- ------------------ ------------------ Units end of year.......... 2,707,441 2,873,152 9,000 ================= ================== ==================
MIST JPMORGAN MIST INVESCO SMALL CAP GROWTH GLOBAL ACTIVE ALLOCATION INVESTMENT DIVISION INVESTMENT DIVISION ------------------------------------------------------- ------------------------------------ 2013 2012 2011 2013 2012 (h) ----------------- ----------------- ----------------- ----------------- ----------------- Units beginning of year.... 245,733 279,254 280,254 17,811 -- Units issued and transferred from other funding options......... 77,189 58,241 85,976 119,559 20,291 Units redeemed and transferred to other funding options......... (71,779) (91,762) (86,976) (43,535) (2,480) ----------------- ----------------- ----------------- ----------------- ----------------- Units end of year.......... 251,143 245,733 279,254 93,835 17,811 ================= ================= ================= ================= ================= MIST LOOMIS SAYLES GLOBAL MIST JPMORGAN SMALL CAP VALUE MARKETS INVESTMENT DIVISION INVESTMENT DIVISION ------------------------------------------------------- ------------------- 2013 2012 2011 2013 (e) ----------------- ----------------- ----------------- ------------------- Units beginning of year.... 2,300 2,480 1,705 -- Units issued and transferred from other funding options......... 10,018 1,210 1,121 22,483 Units redeemed and transferred to other funding options......... (908) (1,390) (346) (649) ----------------- ----------------- ----------------- ------------------- Units end of year.......... 11,410 2,300 2,480 21,834 ================= ================= ================= ===================
MIST MET/TEMPLETON MIST LORD ABBETT BOND DEBENTURE INTERNATIONAL BOND INVESTMENT DIVISION INVESTMENT DIVISION ------------------------------------------------------- ------------------------------------- 2013 2012 2011 2013 2012 (h) ----------------- ----------------- ----------------- ----------------- ----------------- Units beginning of year.... 1,063,203 1,085,311 1,222,207 181 -- Units issued and transferred from other funding options......... 133,374 167,197 200,137 7,357 270 Units redeemed and transferred to other funding options......... (192,665) (189,305) (337,033) (1,571) (89) ----------------- ----------------- ----------------- ----------------- ----------------- Units end of year.......... 1,003,912 1,063,203 1,085,311 5,967 181 ================= ================= ================= ================= ================= MIST METLIFE AGGRESSIVE STRATEGY INVESTMENT DIVISION ------------------------------------------------------- 2013 2012 2011 (f) ----------------- ----------------- ----------------- Units beginning of year.... 1,085,674 1,049,786 -- Units issued and transferred from other funding options......... 197,390 225,712 1,234,168 Units redeemed and transferred to other funding options......... (217,994) (189,824) (184,382) ----------------- ----------------- ----------------- Units end of year.......... 1,065,070 1,085,674 1,049,786 ================= ================= ================= MIST METLIFE MIST METLIFE BALANCED PLUS GROWTH STRATEGY INVESTMENT DIVISION INVESTMENT DIVISION ------------------------------------ ------------------- 2013 2012 (h) 2013 (e) ----------------- ----------------- ------------------- Units beginning of year.... 4,287 -- -- Units issued and transferred from other funding options......... 9,284 4,873 22,996 Units redeemed and transferred to other funding options......... (5,886) (586) (2,276) ----------------- ----------------- ------------------- Units end of year.......... 7,685 4,287 20,720 ================= ================= ===================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. 192 193 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY NOTES TO THE FINANCIAL STATEMENTS -- (CONTINUED) 7. SCHEDULES OF UNITS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011:
MIST METLIFE MULTI-INDEX TARGETED RISK MIST MFS EMERGING MARKETS EQUITY INVESTMENT DIVISION INVESTMENT DIVISION ------------------- ------------------------------------------------------- 2013 (e) 2013 2012 2011 (f) ------------------- ----------------- ----------------- ----------------- Units beginning of year.... -- 6,737 2,070 -- Units issued and transferred from other funding options......... 91 16,265 12,249 2,117 Units redeemed and transferred to other funding options......... (68) (1,297) (7,582) (47) ------------------- ----------------- ----------------- ----------------- Units end of year.......... 23 21,705 6,737 2,070 =================== ================= ================= ================= MIST MFS RESEARCH INTERNATIONAL INVESTMENT DIVISION ------------------------------------------------------ 2013 2012 2011 ----------------- ----------------- ---------------- Units beginning of year.... 920,691 820,338 838,110 Units issued and transferred from other funding options......... 300,336 314,771 223,953 Units redeemed and transferred to other funding options......... (155,528) (214,418) (241,725) ----------------- ----------------- ---------------- Units end of year.......... 1,065,499 920,691 820,338 ================= ================= ================ MIST MORGAN STANLEY MID CAP GROWTH INVESTMENT DIVISION ------------------------------------------------------- 2013 2012 2011 ----------------- ----------------- ----------------- Units beginning of year.... 11,831,703 12,356,734 13,121,650 Units issued and transferred from other funding options......... 1,271,412 1,750,563 1,773,282 Units redeemed and transferred to other funding options......... (1,932,126) (2,275,594) (2,538,198) ----------------- ----------------- ----------------- Units end of year.......... 11,170,989 11,831,703 12,356,734 ================= ================= =================
MIST OPPENHEIMER GLOBAL EQUITY INVESTMENT DIVISION ------------------------------------------------------ 2013 2012 2011 ----------------- ----------------- ---------------- Units beginning of year.... 1,769,256 1,918,512 2,044,692 Units issued and transferred from other funding options......... 403,190 220,361 348,871 Units redeemed and transferred to other funding options......... (492,461) (369,617) (475,051) ----------------- ----------------- ---------------- Units end of year.......... 1,679,985 1,769,256 1,918,512 ================= ================= ================ MIST PIMCO INFLATION PROTECTED BOND INVESTMENT DIVISION ------------------------------------------------------ 2013 2012 2011 ----------------- ----------------- ---------------- Units beginning of year.... 837,709 700,157 653,613 Units issued and transferred from other funding options......... 212,906 381,726 288,475 Units redeemed and transferred to other funding options......... (295,341) (244,174) (241,931) ----------------- ----------------- ---------------- Units end of year.......... 755,274 837,709 700,157 ================= ================= ================ MIST PIMCO TOTAL RETURN INVESTMENT DIVISION ------------------------------------------------------ 2013 2012 2011 ----------------- ----------------- ---------------- Units beginning of year.... 2,365,572 2,427,091 2,450,427 Units issued and transferred from other funding options......... 638,791 550,605 620,126 Units redeemed and transferred to other funding options......... (539,770) (612,124) (643,462) ----------------- ----------------- ---------------- Units end of year.......... 2,464,593 2,365,572 2,427,091 ================= ================= ================ MIST PIONEER FUND INVESTMENT DIVISION ------------------------------------------------------ 2013 2012 2011 ----------------- ----------------- ---------------- Units beginning of year.... 13,454 13,480 17,938 Units issued and transferred from other funding options......... 95 301 399 Units redeemed and transferred to other funding options......... (2,925) (327) (4,857) ----------------- ----------------- ---------------- Units end of year.......... 10,624 13,454 13,480 ================= ================= ================
MIST PYRAMIS MANAGED RISK MIST SCHRODERS GLOBAL MULTI-ASSET INVESTMENT DIVISION INVESTMENT DIVISION ------------------- ------------------------------------ 2013 (e) 2013 2012 (h) ------------------- ----------------- ----------------- Units beginning of year.... -- 5,334 -- Units issued and transferred from other funding options......... 3 18,632 7,478 Units redeemed and transferred to other funding options......... -- (4,880) (2,144) ------------------- ----------------- ----------------- Units end of year.......... 3 19,086 5,334 =================== ================= ================= MIST SSGA GROWTH AND INCOME ETF INVESTMENT DIVISION ------------------------------------------------------ 2013 2012 2011 ----------------- ---------------- ----------------- Units beginning of year.... 450,776 381,525 320,284 Units issued and transferred from other funding options......... 138,933 154,362 139,491 Units redeemed and transferred to other funding options......... (85,966) (85,111) (78,250) ----------------- ---------------- ----------------- Units end of year.......... 503,743 450,776 381,525 ================= ================ ================= MIST SSGA GROWTH ETF INVESTMENT DIVISION ------------------------------------------------------ 2013 2012 2011 ----------------- ----------------- ---------------- Units beginning of year.... 332,667 299,115 237,751 Units issued and transferred from other funding options......... 106,864 100,874 190,117 Units redeemed and transferred to other funding options......... (72,710) (67,322) (128,753) ----------------- ----------------- ---------------- Units end of year.......... 366,821 332,667 299,115 ================= ================= ================ MIST T. ROWE PRICE LARGE CAP VALUE INVESTMENT DIVISION ------------------------------------------------------- 2013 2012 2011 ----------------- ----------------- ----------------- Units beginning of year.... 112,114 108,604 601,441 Units issued and transferred from other funding options......... 30,343 5,096 1,323 Units redeemed and transferred to other funding options......... (14,177) (1,586) (494,160) ----------------- ----------------- ----------------- Units end of year.......... 128,280 112,114 108,604 ================= ================= =================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. 194 195 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY NOTES TO THE FINANCIAL STATEMENTS -- (CONTINUED) 7. SCHEDULES OF UNITS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011:
MIST T. ROWE PRICE MID CAP GROWTH INVESTMENT DIVISION -------------------------------------------------------- 2013 2012 2011 ----------------- ------------------ ----------------- Units beginning of year.... 1,544,904 1,957,835 1,725,748 Units issued and transferred from other funding options......... 265,706 314,763 685,902 Units redeemed and transferred to other funding options......... (327,672) (727,694) (453,815) ----------------- ------------------ ----------------- Units end of year.......... 1,482,938 1,544,904 1,957,835 ================= ================== ================= MIST THIRD AVENUE SMALL CAP VALUE INVESTMENT DIVISION -------------------------------------------------------- 2013 2012 2011 ----------------- ------------------ ----------------- Units beginning of year.... 50,513 54,483 96,930 Units issued and transferred from other funding options......... 3,119 8,078 30,935 Units redeemed and transferred to other funding options......... (12,202) (12,048) (73,382) ----------------- ------------------ ----------------- Units end of year.......... 41,430 50,513 54,483 ================= ================== ================= MSF BAILLIE GIFFORD INTERNATIONAL STOCK INVESTMENT DIVISION -------------------------------------------------------- 2013 2012 2011 ----------------- ------------------ ----------------- Units beginning of year.... 2,785,901 2,947,427 2,985,340 Units issued and transferred from other funding options......... 371,228 466,869 537,715 Units redeemed and transferred to other funding options......... (461,930) (628,395) (575,628) ----------------- ------------------ ----------------- Units end of year.......... 2,695,199 2,785,901 2,947,427 ================= ================== ================= MSF BARCLAYS AGGREGATE BOND INDEX INVESTMENT DIVISION ------------------------------------------------------- 2013 2012 2011 ----------------- ----------------- ----------------- Units beginning of year.... 5,528,875 5,367,889 6,069,208 Units issued and transferred from other funding options......... 1,310,705 1,299,442 1,036,792 Units redeemed and transferred to other funding options......... (935,140) (1,138,456) (1,738,111) ----------------- ----------------- ----------------- Units end of year.......... 5,904,440 5,528,875 5,367,889 ================= ================= =================
MSF BLACKROCK BOND INCOME INVESTMENT DIVISION ------------------------------------------------------- 2013 2012 2011 ----------------- ----------------- ----------------- Units beginning of year.... 3,286,524 3,448,815 3,695,898 Units issued and transferred from other funding options......... 408,801 453,762 476,235 Units redeemed and transferred to other funding options......... (530,588) (616,053) (723,318) ----------------- ----------------- ----------------- Units end of year.......... 3,164,737 3,286,524 3,448,815 ================= ================= ================= MSF BLACKROCK CAPITAL APPRECIATION INVESTMENT DIVISION ------------------------------------------------------- 2013 2012 2011 ----------------- ----------------- ----------------- Units beginning of year.... 1,083,757 533,802 494,998 Units issued and transferred from other funding options......... 306,867 759,181 231,277 Units redeemed and transferred to other funding options......... (152,555) (209,226) (192,473) ----------------- ----------------- ----------------- Units end of year.......... 1,238,069 1,083,757 533,802 ================= ================= ================= MSF BLACKROCK DIVERSIFIED INVESTMENT DIVISION ------------------------------------------------------- 2013 2012 2011 ----------------- ----------------- ----------------- Units beginning of year.... 9,597,280 10,223,668 10,826,228 Units issued and transferred from other funding options......... 1,003,288 1,214,215 1,401,995 Units redeemed and transferred to other funding options......... (1,506,903) (1,840,603) (2,004,555) ----------------- ----------------- ----------------- Units end of year.......... 9,093,665 9,597,280 10,223,668 ================= ================= ================= MSF BLACKROCK LARGE CAP VALUE INVESTMENT DIVISION ------------------------------------------------------- 2013 2012 2011 ----------------- ----------------- ----------------- Units beginning of year.... 972,398 1,036,664 1,026,360 Units issued and transferred from other funding options......... 172,172 193,068 229,911 Units redeemed and transferred to other funding options......... (191,793) (257,334) (219,607) ----------------- ----------------- ----------------- Units end of year.......... 952,777 972,398 1,036,664 ================= ================= =================
MSF BLACKROCK MONEY MARKET INVESTMENT DIVISION ------------------------------------------------------- 2013 2012 2011 ----------------- ----------------- ----------------- Units beginning of year.... 1,306,002 1,163,332 1,663,896 Units issued and transferred from other funding options......... 573,675 797,800 607,896 Units redeemed and transferred to other funding options......... (545,615) (655,130) (1,108,460) ----------------- ----------------- ----------------- Units end of year.......... 1,334,062 1,306,002 1,163,332 ================= ================= ================= MSF DAVIS VENTURE VALUE INVESTMENT DIVISION ------------------------------------------------------ 2013 2012 2011 ---------------- ----------------- ----------------- Units beginning of year.... 1,511,861 1,569,723 1,632,869 Units issued and transferred from other funding options......... 186,017 233,892 320,460 Units redeemed and transferred to other funding options......... (307,928) (291,754) (383,606) ---------------- ----------------- ----------------- Units end of year.......... 1,389,950 1,511,861 1,569,723 ================ ================= ================= MSF FRONTIER MID CAP GROWTH INVESTMENT DIVISION ------------------------------------------------------ 2013 2012 2011 ----------------- ---------------- ----------------- Units beginning of year.... 8,053,406 8,613,267 9,010,506 Units issued and transferred from other funding options......... 669,008 944,396 1,226,282 Units redeemed and transferred to other funding options......... (1,394,209) (1,504,257) (1,623,521) ----------------- ---------------- ----------------- Units end of year.......... 7,328,205 8,053,406 8,613,267 ================= ================ ================= MSF JENNISON GROWTH INVESTMENT DIVISION ------------------------------------------------------ 2013 2012 2011 ----------------- ----------------- ---------------- Units beginning of year.... 1,151,518 1,066,474 1,234,658 Units issued and transferred from other funding options......... 133,920 309,675 212,585 Units redeemed and transferred to other funding options......... (271,327) (224,631) (380,769) ----------------- ----------------- ---------------- Units end of year.......... 1,014,111 1,151,518 1,066,474 ================= ================= ================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. 196 197 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY NOTES TO THE FINANCIAL STATEMENTS -- (CONTINUED) 7. SCHEDULES OF UNITS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011:
MSF LOOMIS SAYLES SMALL CAP CORE INVESTMENT DIVISION ------------------------------------------------------- 2013 2012 2011 ----------------- ----------------- ----------------- Units beginning of year.... 88,479 95,949 115,539 Units issued and transferred from other funding options......... 9,232 10,523 19,557 Units redeemed and transferred to other funding options......... (16,439) (17,993) (39,147) ----------------- ----------------- ----------------- Units end of year.......... 81,272 88,479 95,949 ================= ================= ================= MSF LOOMIS SAYLES SMALL CAP GROWTH INVESTMENT DIVISION ------------------------------------------------------- 2013 2012 2011 ----------------- ----------------- ----------------- Units beginning of year.... 569,420 639,754 597,616 Units issued and transferred from other funding options......... 141,821 96,222 204,191 Units redeemed and transferred to other funding options......... (135,766) (166,556) (162,053) ----------------- ----------------- ----------------- Units end of year.......... 575,475 569,420 639,754 ================= ================= ================= MSF MET/ARTISAN MID CAP VALUE INVESTMENT DIVISION ------------------------------------------------------- 2013 2012 2011 ----------------- ----------------- ----------------- Units beginning of year.... 188,777 187,483 222,836 Units issued and transferred from other funding options......... 34,357 37,546 55,960 Units redeemed and transferred to other funding options......... (43,905) (36,252) (91,313) ----------------- ----------------- ----------------- Units end of year.......... 179,229 188,777 187,483 ================= ================= ================= MSF METLIFE CONSERVATIVE ALLOCATION INVESTMENT DIVISION ------------------------------------------------------- 2013 2012 2011 ----------------- ----------------- ----------------- Units beginning of year.... 330,868 293,962 281,025 Units issued and transferred from other funding options......... 80,970 138,689 187,246 Units redeemed and transferred to other funding options......... (109,570) (101,783) (174,309) ----------------- ----------------- ----------------- Units end of year.......... 302,268 330,868 293,962 ================= ================= =================
MSF METLIFE CONSERVATIVE TO MODERATE ALLOCATION INVESTMENT DIVISION -------------------------------------------------------- 2013 2012 2011 ----------------- ------------------ ----------------- Units beginning of year.... 548,694 491,119 523,187 Units issued and transferred from other funding options......... 132,624 165,315 194,728 Units redeemed and transferred to other funding options......... (152,673) (107,740) (226,796) ----------------- ------------------ ----------------- Units end of year.......... 528,645 548,694 491,119 ================= ================== ================= MSF METLIFE MID CAP STOCK INDEX INVESTMENT DIVISION -------------------------------------------------------- 2013 2012 2011 ----------------- ------------------ ----------------- Units beginning of year.... 2,971,386 3,140,839 3,223,737 Units issued and transferred from other funding options......... 688,636 476,623 578,839 Units redeemed and transferred to other funding options......... (563,308) (646,076) (661,737) ----------------- ------------------ ----------------- Units end of year.......... 3,096,714 2,971,386 3,140,839 ================= ================== ================= MSF METLIFE MODERATE ALLOCATION INVESTMENT DIVISION -------------------------------------------------------- 2013 2012 2011 ----------------- ----------------- ------------------ Units beginning of year.... 3,085,848 3,050,810 2,825,563 Units issued and transferred from other funding options......... 570,724 658,640 818,677 Units redeemed and transferred to other funding options......... (697,334) (623,602) (593,430) ----------------- ----------------- ------------------ Units end of year.......... 2,959,238 3,085,848 3,050,810 ================= ================= ================== MSF METLIFE MODERATE TO AGGRESSIVE ALLOCATION INVESTMENT DIVISION ------------------------------------------------------- 2013 2012 2011 ----------------- ----------------- ----------------- Units beginning of year.... 5,433,641 5,400,236 5,118,269 Units issued and transferred from other funding options......... 951,279 1,100,174 1,298,976 Units redeemed and transferred to other funding options......... (1,080,050) (1,066,769) (1,017,009) ----------------- ----------------- ----------------- Units end of year.......... 5,304,870 5,433,641 5,400,236 ================= ================= =================
MSF METLIFE STOCK INDEX INVESTMENT DIVISION ------------------------------------------------------ 2013 2012 2011 ----------------- ---------------- ----------------- Units beginning of year.... 35,058,600 36,301,700 36,664,506 Units issued and transferred from other funding options......... 3,838,942 4,994,055 5,857,273 Units redeemed and transferred to other funding options......... (5,393,259) (6,237,155) (6,220,079) ----------------- ---------------- ----------------- Units end of year.......... 33,504,283 35,058,600 36,301,700 ================= ================ ================= MSF MFS TOTAL RETURN INVESTMENT DIVISION ------------------------------------------------------ 2013 2012 2011 ---------------- ----------------- ----------------- Units beginning of year.... 523,594 528,477 568,106 Units issued and transferred from other funding options......... 78,131 105,811 110,243 Units redeemed and transferred to other funding options......... (85,265) (110,694) (149,872) ---------------- ----------------- ----------------- Units end of year.......... 516,460 523,594 528,477 ================ ================= ================= MSF MFS VALUE INVESTMENT DIVISION ------------------------------------------------------ 2013 2012 2011 ---------------- ----------------- ---------------- Units beginning of year.... 3,634,888 3,828,828 3,975,344 Units issued and transferred from other funding options......... 938,625 529,637 685,905 Units redeemed and transferred to other funding options......... (693,073) (723,577) (832,421) ---------------- ----------------- ---------------- Units end of year.......... 3,880,440 3,634,888 3,828,828 ================ ================= ================ MSF MSCI EAFE INDEX INVESTMENT DIVISION ------------------------------------------------------ 2013 2012 2011 ----------------- ---------------- ----------------- Units beginning of year.... 4,738,737 4,910,651 4,717,340 Units issued and transferred from other funding options......... 768,969 973,636 1,183,779 Units redeemed and transferred to other funding options......... (887,940) (1,145,550) (990,468) ----------------- ---------------- ----------------- Units end of year.......... 4,619,766 4,738,737 4,910,651 ================= ================ =================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. 198 199 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY NOTES TO THE FINANCIAL STATEMENTS -- (CONTINUED) 7. SCHEDULES OF UNITS -- (CONTINUED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011:
MSF NEUBERGER BERMAN GENESIS INVESTMENT DIVISION ------------------------------------------------------- 2013 2012 2011 ----------------- ----------------- ----------------- Units beginning of year.... 3,701,342 3,915,596 4,111,864 Units issued and transferred from other funding options......... 615,549 506,545 590,730 Units redeemed and transferred to other funding options......... (647,874) (720,799) (786,998) ----------------- ----------------- ----------------- Units end of year.......... 3,669,017 3,701,342 3,915,596 ================= ================= ================= MSF RUSSELL 2000 INDEX INVESTMENT DIVISION ------------------------------------------------------- 2013 2012 2011 ----------------- ----------------- ----------------- Units beginning of year.... 2,492,581 2,653,125 2,808,600 Units issued and transferred from other funding options......... 288,294 369,378 516,402 Units redeemed and transferred to other funding options......... (452,487) (529,922) (671,877) ----------------- ----------------- ----------------- Units end of year.......... 2,328,388 2,492,581 2,653,125 ================= ================= ================= MSF T. ROWE PRICE LARGE CAP GROWTH INVESTMENT DIVISION ------------------------------------------------------- 2013 2012 2011 ----------------- ----------------- ----------------- Units beginning of year.... 2,902,055 2,954,760 3,148,378 Units issued and transferred from other funding options......... 1,182,376 509,096 503,272 Units redeemed and transferred to other funding options......... (656,644) (561,801) (696,890) ----------------- ----------------- ----------------- Units end of year.......... 3,427,787 2,902,055 2,954,760 ================= ================= ================= MSF T. ROWE PRICE SMALL CAP GROWTH INVESTMENT DIVISION ------------------------------------------------------- 2013 2012 2011 ----------------- ----------------- ----------------- Units beginning of year.... 3,660,384 3,938,724 4,055,742 Units issued and transferred from other funding options......... 337,801 426,779 645,717 Units redeemed and transferred to other funding options......... (591,734) (705,119) (762,735) ----------------- ----------------- ----------------- Units end of year.......... 3,406,451 3,660,384 3,938,724 ================= ================= =================
MSF VAN ECK GLOBAL NATURAL RESOURCES INVESTMENT DIVISION ------------------------------------------------------ 2013 2012 2011 (f) ----------------- ---------------- ----------------- Units beginning of year.... 319 81 -- Units issued and transferred from other funding options......... 661 295 83 Units redeemed and transferred to other funding options......... (64) (57) (2) ----------------- ---------------- ----------------- Units end of year.......... 916 319 81 ================= ================ ================= MSF WESTERN ASSET MANAGEMENT STRATEGIC BOND OPPORTUNITIES INVESTMENT DIVISION ------------------------------------------------------- 2013 2012 2011 ----------------- ----------------- ----------------- Units beginning of year.... 1,037,022 1,068,823 1,145,809 Units issued and transferred from other funding options......... 177,853 191,180 190,447 Units redeemed and transferred to other funding options......... (192,623) (222,981) (267,433) ----------------- ----------------- ----------------- Units end of year.......... 1,022,252 1,037,022 1,068,823 ================= ================= ================= MSF WESTERN ASSET MANAGEMENT U.S. GOVERNMENT INVESTMENT DIVISION ------------------------------------------------------- 2013 2012 2011 ----------------- ----------------- ----------------- Units beginning of year.... 936,357 957,065 1,021,769 Units issued and transferred from other funding options......... 186,398 195,506 193,206 Units redeemed and transferred to other funding options......... (187,378) (216,214) (257,910) ----------------- ----------------- ----------------- Units end of year.......... 935,377 936,357 957,065 ================= ================= ================= PIMCO VIT ALL ASSET INVESTMENT DIVISION ------------------------------------------------------- 2013 2012 2011 (f) ----------------- ----------------- ----------------- Units beginning of year.... 10,325 8,649 -- Units issued and transferred from other funding options......... 69,923 2,051 8,680 Units redeemed and transferred to other funding options......... (8,105) (375) (31) ----------------- ----------------- ----------------- Units end of year.......... 72,143 10,325 8,649 ================= ================= =================
PIMCO VIT COMMODITY REAL RETURN STRATEGY PIMCO VIT LOW DURATION INVESTMENT DIVISION INVESTMENT DIVISION ------------------- ------------------------------------------------------ 2013 (e) 2013 2012 2011 ------------------- ----------------- ---------------- ----------------- Units beginning of year.... -- 79,088 80,364 65,497 Units issued and transferred from other funding options......... 502 72,882 2,679 16,680 Units redeemed and transferred to other funding options......... (23) (25,782) (3,955) (1,813) ------------------- ----------------- ---------------- ----------------- Units end of year.......... 479 126,188 79,088 80,364 =================== ================= ================ ================= PIONEER VCT EMERGING MARKETS INVESTMENT DIVISION ------------------------------------------------------ 2013 2012 2011 ----------------- ---------------- ----------------- Units beginning of year.... 33,221 22,116 41,431 Units issued and transferred from other funding options......... 4,730 24,901 15,775 Units redeemed and transferred to other funding options......... (24,389) (13,796) (35,090) ----------------- ---------------- ----------------- Units end of year.......... 13,562 33,221 22,116 ================= ================ ================= PIONEER VCT MID CAP VALUE INVESTMENT DIVISION ----------------------------------------------------- 2013 2012 2011 ----------------- ---------------- ---------------- Units beginning of year.... 3,389 3,306 2,302 Units issued and transferred from other funding options......... -- 238 1,144 Units redeemed and transferred to other funding options......... (2,561) (155) (140) ----------------- ---------------- ---------------- Units end of year.......... 828 3,389 3,306 ================= ================ ================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. 200 201 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY NOTES TO THE FINANCIAL STATEMENTS -- (CONTINUED) 7. SCHEDULES OF UNITS -- (CONCLUDED) FOR THE YEARS ENDED DECEMBER 31, 2013, 2012 AND 2011:
PUTNAM VT INTERNATIONAL VALUE ROYCE MICRO-CAP INVESTMENT DIVISION INVESTMENT DIVISION ------------------- -------------------------------------------------------- 2013 (b) 2013 2012 2011 ------------------- ----------------- ----------------- ------------------ Units beginning of year.... -- 21,685 19,473 19,226 Units issued and transferred from other funding options......... 250 101 2,968 1,095 Units redeemed and transferred to other funding options......... (11) (21,412) (756) (848) ------------------- ----------------- ----------------- ------------------ Units end of year.......... 239 374 21,685 19,473 =================== ================= ================= ================== ROYCE SMALL-CAP INVESTMENT DIVISION -------------------------------------------------------- 2013 2012 2011 ----------------- ----------------- ------------------ Units beginning of year.... 33,234 52,075 26,235 Units issued and transferred from other funding options......... 10,487 11,367 66,609 Units redeemed and transferred to other funding options......... (12,365) (30,208) (40,769) ----------------- ----------------- ------------------ Units end of year.......... 31,356 33,234 52,075 ================= ================= ================== UIF EMERGING MARKETS DEBT INVESTMENT DIVISION ------------------------------------------------------- 2013 2012 2011 ----------------- ----------------- ----------------- Units beginning of year.... 33,059 13,883 259 Units issued and transferred from other funding options......... 5,716 21,216 14,310 Units redeemed and transferred to other funding options......... (3,237) (2,040) (686) ----------------- ----------------- ----------------- Units end of year.......... 35,538 33,059 13,883 ================= ================= =================
UIF EMERGING MARKETS EQUITY INVESTMENT DIVISION ------------------------------------------------------- 2013 2012 2011 ----------------- ----------------- ----------------- Units beginning of year.... 69,412 43,435 13,018 Units issued and transferred from other funding options......... 25,714 30,945 46,847 Units redeemed and transferred to other funding options......... (11,260) (4,968) (16,430) ----------------- ----------------- ----------------- Units end of year.......... 83,866 69,412 43,435 ================= ================= ================= WELLS FARGO VT TOTAL RETURN BOND INVESTMENT DIVISION -------------------------------------------------------- 2013 2012 2011 ----------------- ----------------- ------------------ Units beginning of year.... 29,620 8,689 75,281 Units issued and transferred from other funding options......... 3,045 26,948 4,877 Units redeemed and transferred to other funding options......... (16,659) (6,017) (71,469) ----------------- ----------------- ------------------ Units end of year.......... 16,006 29,620 8,689 ================= ================= ==================
(a) Commenced May 3, 2010 and began transactions in 2012. (b) Commenced April 28, 2008 and began transactions in 2013. (c) Commenced May 3, 2010 and began transactions in 2013. (d) Commenced May 3, 2010 and began transactions in 2011. (e) For the period April 29, 2013 to December 31, 2013. (f) For the period May 2, 2011 to December 31, 2011. (g) For the period August 19, 2013 to December 31, 2013. (h) For the period April 30, 2012 to December 31, 2012. 202 203 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY NOTES TO THE FINANCIAL STATEMENTS -- (CONTINUED) 8. FINANCIAL HIGHLIGHTS The Company sells a number of variable life products which have unique combinations of features and fees, some of which directly affect the unit values of the Investment Divisions. Differences in the fee structures result in a variety of unit values, expense ratios, and total returns. The following table is a summary of unit values and units outstanding for the Policies, net investment income ratios, and expense ratios, excluding expenses for the underlying fund, portfolio, or series, for the respective stated periods in the five years ended December 31, 2013:
AS OF DECEMBER 31 ------------------------------------------- UNIT VALUE LOWEST TO NET UNITS HIGHEST ($) ASSETS ($) ----------- ---------------- ------------ AllianceBernstein Global 2013 10,121 6.54 66,166 Thematic Growth 2012 11,630 5.32 61,856 Investment Division 2011 914,212 4.70 4,293,695 2010 19,486 6.13 119,488 2009 25,043 5.17 129,504 AllianceBernstein 2013 3,812 15.11 57,615 Intermediate Bond 2012 6,675 15.48 103,300 Investment Division 2011 3,232 14.63 47,286 (Commenced 5/1/2005 and 2010 3,146 13.75 43,265 began transactions in 2009) 2009 2,242 12.62 28,308 American Century VP Vista 2013 37 19.18 710 Investment Division 2012 279 14.73 4,105 2011 679 12.74 8,654 2010 5,360 13.83 74,155 2009 13,115 11.17 146,455 American Funds Bond 2013 417,001 12.15 - 21.88 5,589,275 Investment Division 2012 397,946 12.53 - 22.37 5,420,310 2011 367,699 11.99 - 21.23 4,735,459 2010 361,073 11.41 - 20.00 4,365,031 2009 335,183 10.81 - 18.79 3,760,642 American Funds Global Small 2013 1,848,240 35.34 - 45.52 72,066,620 Capitalization 2012 1,947,587 27.80 - 35.48 59,237,806 Investment Division 2011 2,037,588 23.74 - 30.03 52,474,989 2010 2,114,920 29.62 - 37.13 67,405,353 2009 2,152,577 24.42 - 30.34 56,054,284 American Funds Growth 2013 1,184,798 30.71 - 335.94 160,553,244 Investment Division 2012 1,269,410 23.60 - 258.21 130,921,222 2011 1,353,057 20.02 - 219.03 118,199,510 2010 1,411,108 20.92 - 228.81 127,437,855 2009 1,419,237 17.62 - 192.80 109,197,492 American Funds 2013 1,315,261 68.78 - 234.74 101,213,157 Growth-Income 2012 1,382,116 51.99 - 175.83 79,614,717 Investment Division 2011 1,453,945 44.65 - 149.67 71,256,817 2010 1,483,095 45.89 - 152.46 73,861,194 2009 1,491,242 41.56 - 136.83 66,537,414 American Funds High-Income 2013 1,325 13.25 17,547 Bond Investment Division 2012 4,606 12.43 57,231 (Commenced 5/3/2010 and began transactions in 2012) FOR THE YEAR ENDED DECEMBER 31 -------------------------------------------------- INVESTMENT(1) EXPENSE RATIO(2) TOTAL RETURN(3) INCOME LOWEST TO LOWEST TO RATIO (%) HIGHEST (%) HIGHEST (%) ------------- ---------------- ----------------- AllianceBernstein Global 2013 0.02 0.00 22.93 Thematic Growth 2012 -- 0.00 13.24 Investment Division 2011 0.43 0.00 (23.40) 2010 1.84 0.00 18.58 2009 -- 0.00 53.14 AllianceBernstein 2013 3.09 0.00 (2.34) Intermediate Bond 2012 3.42 0.00 5.79 Investment Division 2011 4.56 0.00 6.38 (Commenced 5/1/2005 and 2010 5.90 0.00 8.93 began transactions in 2009) 2009 4.18 0.00 18.20 American Century VP Vista 2013 -- 0.00 30.17 Investment Division 2012 -- 0.00 15.61 2011 -- 0.00 (7.90) 2010 -- 0.00 23.88 2009 -- 0.00 22.47 American Funds Bond 2013 1.83 0.00 - 0.90 (3.03) - (2.16) Investment Division 2012 2.55 0.00 - 0.90 4.42 - 5.37 2011 3.08 0.00 - 0.90 5.15 - 6.10 2010 3.15 0.00 - 0.90 5.49 - 6.44 2009 3.37 0.90 11.60 - 12.61 American Funds Global Small 2013 0.87 0.00 - 0.90 27.13 - 28.28 Capitalization 2012 1.34 0.00 - 0.90 17.11 - 18.18 Investment Division 2011 1.33 0.00 - 0.90 (19.87) - (19.14) 2010 1.74 0.00 - 0.90 21.32 - 22.41 2009 0.29 0.90 59.85 - 61.30 American Funds Growth 2013 0.94 0.00 - 0.90 28.94 - 30.10 Investment Division 2012 0.80 0.00 - 0.90 16.83 - 17.89 2011 0.61 0.00 - 0.90 (5.13) - (4.27) 2010 0.73 0.00 - 0.90 17.62 - 18.68 2009 0.67 0.90 38.16 - 39.41 American Funds 2013 1.37 0.00 - 0.90 32.30 - 33.50 Growth-Income 2012 1.64 0.00 - 0.90 16.42 - 17.48 Investment Division 2011 1.57 0.00 - 0.90 (2.71) - (1.83) 2010 1.51 0.00 - 0.90 10.43 - 11.43 2009 1.65 0.90 30.07 - 31.24 American Funds High-Income 2013 5.44 0.00 6.60 Bond Investment Division 2012 5.70 0.00 6.93 (Commenced 5/3/2010 and began transactions in 2012)
204 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY NOTES TO THE FINANCIAL STATEMENTS -- (CONTINUED) 8. FINANCIAL HIGHLIGHTS -- (CONTINUED)
AS OF DECEMBER 31 ------------------------------------------ UNIT VALUE LOWEST TO NET UNITS HIGHEST ($) ASSETS ($) ----------- --------------- ------------ American Funds 2013 19,162 35.77 685,392 International Investment 2012 18,773 29.41 552,053 Division 2011 21,039 24.94 524,711 2010 27,930 28.99 809,625 2009 17,214 27.03 465,344 American Funds U.S. 2013 2,093 22.21 46,484 Government/AAA-Rated 2012 1,972 22.92 45,192 Securities 2011 2,025 22.49 45,539 Investment Division 2010 1,810 20.90 37,830 2009 4,564 19.77 90,231 Dreyfus VIF International 2013 15,672 15.72 246,317 Value Investment Division 2012 16,013 12.81 205,133 2011 16,153 11.40 184,061 2010 16,502 14.03 231,464 2009 21,676 13.45 291,742 Fidelity VIP Asset Manager: 2013 132,058 14.61 1,929,922 Growth Investment Division 2012 164,596 11.95 1,966,232 2011 138,116 10.36 1,430,516 2010 172,460 11.05 1,905,608 2009 181,097 9.51 1,722,435 Fidelity VIP Contrafund 2013 115,785 22.89 2,650,302 Investment Division 2012 147,414 15.89 2,343,022 2011 157,450 13.67 2,151,649 2010 190,755 14.04 2,677,373 2009 332,757 11.99 3,988,185 Fidelity VIP Equity-Income 2013 1,817 18.42 33,464 Investment Division 2012 4,431 14.06 62,291 2011 1,549 12.00 18,589 2010 17,040 11.90 202,690 2009 23,778 10.33 245,766 Fidelity VIP Freedom 2010 2013 3,488 13.26 46,242 Investment Division 2012 3,378 11.73 39,638 2011 3,238 10.55 34,144 2010 3,002 10.61 31,860 2009 1,541 9.44 - 12.05 14,548 Fidelity VIP Freedom 2020 2013 58,587 13.04 - 17.80 977,715 Investment Division 2012 51,279 11.29 - 15.34 764,724 2011 53,514 10.01 - 13.53 699,714 2010 56,297 10.16 - 13.67 738,702 2009 56,341 8.91 - 11.94 648,511 Fidelity VIP Freedom 2025 2013 2,149 18.70 40,181 Investment Division (Commenced 4/28/2008 and began transactions in 2013) FOR THE YEAR ENDED DECEMBER 31 ------------------------------------------------- INVESTMENT(1) EXPENSE RATIO(2) TOTAL RETURN(3) INCOME LOWEST TO LOWEST TO RATIO (%) HIGHEST (%) HIGHEST (%) ------------- ---------------- ---------------- American Funds 2013 1.65 0.00 21.63 International Investment 2012 1.43 0.00 17.91 Division 2011 1.50 0.00 (13.96) 2010 2.23 0.00 7.23 2009 1.51 0.00 43.07 American Funds U.S. 2013 0.68 0.00 (3.08) Government/AAA-Rated 2012 1.00 0.00 1.90 Securities 2011 1.73 0.00 7.57 Investment Division 2010 1.49 0.00 5.75 2009 3.32 0.00 2.50 Dreyfus VIF International 2013 1.78 0.00 22.69 Value Investment Division 2012 2.56 0.00 12.42 2011 1.88 0.00 (18.76) 2010 1.53 0.00 4.22 2009 3.77 0.00 30.67 Fidelity VIP Asset Manager: 2013 0.83 0.00 22.34 Growth Investment Division 2012 1.40 0.00 15.34 2011 1.33 0.00 (6.27) 2010 1.12 0.00 16.18 2009 1.60 0.00 32.79 Fidelity VIP Contrafund 2013 0.95 0.00 44.02 Investment Division 2012 1.22 0.00 16.31 2011 0.83 0.00 (2.64) 2010 0.96 0.00 17.11 2009 1.48 0.00 35.66 Fidelity VIP Equity-Income 2013 2.56 0.00 31.02 Investment Division 2012 5.62 0.00 17.19 2011 0.35 0.00 0.86 2010 1.60 0.00 15.09 2009 1.95 0.00 30.03 Fidelity VIP Freedom 2010 2013 1.76 0.00 12.98 Investment Division 2012 1.97 0.00 11.28 2011 2.18 0.00 (0.63) 2010 2.67 0.00 12.45 2009 3.32 0.45 23.72 - 24.27 Fidelity VIP Freedom 2020 2013 1.87 0.00 15.49 - 16.01 Investment Division 2012 2.06 0.00 12.87 - 13.38 2011 2.10 0.00 (1.47) - (1.03) 2010 2.26 0.00 13.98 - 14.49 2009 4.16 0.45 28.40 - 28.97 Fidelity VIP Freedom 2025 2013 1.79 0.00 19.95 Investment Division (Commenced 4/28/2008 and began transactions in 2013)
205 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY NOTES TO THE FINANCIAL STATEMENTS -- (CONTINUED) 8. FINANCIAL HIGHLIGHTS -- (CONTINUED)
AS OF DECEMBER 31 FOR THE YEAR ENDED DECEMBER 31 ----------------------------------------- ------------------------------------------------- UNIT VALUE INVESTMENT(1) EXPENSE RATIO(2) TOTAL RETURN(3) LOWEST TO NET INCOME LOWEST TO LOWEST TO UNITS HIGHEST ($) ASSETS ($) RATIO (%) HIGHEST (%) HIGHEST (%) ---------- --------------- ------------ ------------- ---------------- ---------------- Fidelity VIP Freedom 2030 2013 4,709 13.17 62,024 1.93 0.00 21.12 Investment Division 2012 3,939 10.87 42,834 1.84 0.00 15.06 2011 6,028 9.45 - 13.00 56,970 1.97 0.00 (3.03) - (2.59) 2010 9,011 9.75 - 13.35 108,191 2.42 0.00 15.56 - 16.08 2009 3,665 8.43 - 11.50 31,738 2.47 0.45 31.07 - 31.66 Fidelity VIP Freedom 2040 2013 782 15.12 11,831 3.69 0.00 24.73 Investment Division (Commenced 5/3/2010 and began transactions in 2013) Fidelity VIP Freedom 2050 2013 1,444 15.25 22,014 1.43 0.00 25.78 Investment Division 2012 1,468 12.12 17,799 2.12 0.00 17.20 (Commenced 5/3/2010 and 2011 1,492 10.34 15,438 1.77 0.00 (5.36) began transactions in 2011) Fidelity VIP High Income 2013 8,598 19.54 167,992 5.84 0.00 5.95 Investment Division 2012 8,955 18.44 165,146 14.49 0.00 14.23 (Commenced 4/28/2008 and 2011 2,677 16.14 43,223 37.24 0.00 4.03 began transactions in 2009) 2010 294 15.52 4,565 4.94 0.00 13.82 2009 3,001 13.63 40,915 26.74 0.00 43.96 Fidelity VIP Investment 2013 109,725 15.50 1,700,205 2.44 0.00 (1.89) Grade Bond Investment 2012 144,729 15.79 2,285,792 1.95 0.00 5.77 Division 2011 117,053 14.93 1,747,852 4.67 0.00 7.21 2010 38,436 13.93 535,344 4.23 0.00 7.68 2009 18,087 12.93 233,950 10.75 0.00 15.67 Fidelity VIP Mid Cap 2013 6,501 38.32 249,087 0.09 0.00 35.87 Investment Division 2012 26,557 28.20 748,919 0.42 0.00 14.56 2011 24,942 24.62 613,958 0.03 0.00 (10.85) 2010 16,733 27.61 462,031 0.15 0.00 28.57 2009 10,051 21.48 215,869 0.29 0.00 39.75 FTVIPT Franklin Income 2013 1 851.40 618 -- 0.00 7.52 Securities Investment Division (Commenced 4/29/2013) FTVIPT Mutual Global 2013 19,479 25.41 494,934 2.33 0.00 27.61 Discovery Securities 2012 40,339 19.91 803,176 2.67 0.00 13.36 Investment Division 2011 44,626 17.56 783,835 2.31 0.00 (2.96) 2010 53,444 18.10 967,332 1.39 0.00 11.96 2009 54,588 16.17 882,515 0.75 0.00 23.31 FTVIPT Mutual Shares 2013 67 361.74 24,208 2.28 0.00 16.31 Securities Investment Division (Commenced 4/29/2013) FTVIPT Templeton Foreign 2013 203,220 21.68 4,405,694 2.41 0.00 23.27 Securities Investment 2012 225,312 17.59 3,962,470 3.26 0.00 18.60 Division 2011 203,775 14.83 3,021,785 1.67 0.00 (10.44) 2010 558,309 16.56 9,244,694 2.02 0.00 8.67 2009 520,792 15.24 7,935,141 3.61 0.00 37.34
206 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY NOTES TO THE FINANCIAL STATEMENTS -- (CONTINUED) 8. FINANCIAL HIGHLIGHTS -- (CONTINUED)
AS OF DECEMBER 31 FOR THE YEAR ENDED DECEMBER 31 ------------------------------------------ ------------------------------------------------ UNIT VALUE INVESTMENT(1) EXPENSE RATIO(2) TOTAL RETURN(3) LOWEST TO NET INCOME LOWEST TO LOWEST TO UNITS HIGHEST ($) ASSETS ($) RATIO (%) HIGHEST (%) HIGHEST (%) ----------- --------------- ------------ ------------- ---------------- --------------- FTVIPT Templeton Global 2013 54,283 24.27 1,317,714 3.58 0.00 1.89 Bond Securities Investment 2012 18,556 23.82 442,101 6.56 0.00 15.31 Division 2011 14,004 20.66 289,345 3.79 0.00 (0.61) (Commenced 5/4/2009) 2010 179 20.79 3,728 0.20 0.00 14.71 2009 204 18.12 3,704 -- 0.00 95.55 Goldman Sachs Mid-Cap Value 2013 11,790 25.09 295,859 0.85 0.00 51.88 Investment Division 2012 15,625 16.52 258,154 1.06 0.00 18.47 2011 19,234 13.95 268,248 0.67 0.00 (6.37) 2010 24,643 14.90 367,089 0.70 0.00 25.00 2009 27,552 11.92 328,341 1.09 0.00 33.15 Goldman Sachs Structured 2013 2,114 19.63 41,480 1.13 0.00 43.55 Small Cap Equity Investment 2012 1,925 13.67 26,317 1.02 0.00 12.83 Division 2011 4,148 12.12 50,259 0.82 0.00 0.67 2010 4,258 12.04 51,252 0.57 0.00 30.12 2009 7,623 9.25 70,508 1.46 0.00 27.67 Invesco V.I. Comstock 2013 18,458 17.08 315,275 1.46 0.00 35.65 Investment Division 2012 18,847 12.59 237,306 1.58 0.00 18.92 (Commenced 5/3/2010) 2011 17,951 10.59 190,062 0.44 0.00 (2.11) 2010 2,966 10.82 32,084 -- 0.00 19.94 Invesco V.I. Global Real 2013 65,702 39.35 2,585,678 3.84 0.00 11.28 Estate Investment Division 2012 73,934 35.37 2,614,736 0.56 0.00 28.12 2011 54,002 27.60 1,490,644 4.08 0.00 (6.51) 2010 54,093 29.53 1,597,111 5.17 0.00 17.51 2009 59,960 25.13 1,506,522 -- 0.00 31.53 Invesco V.I. Government 2013 810 13.59 11,016 4.03 0.00 (2.85) Securities Investment 2012 22 13.99 311 -- 0.00 10.11 Division 2011 1,570 13.69 21,491 -- 0.00 7.73 (Commenced 5/2/2011) Invesco V.I. International 2013 16,229 24.60 399,191 0.34 0.00 19.01 Growth Investment Division 2012 314,797 20.67 6,506,152 1.58 0.00 15.53 (Commenced 4/28/2008 and 2011 1,308 17.89 23,407 1.52 0.00 (6.74) began transactions in 2009) 2010 14,201 19.18 272,411 2.40 0.00 12.86 2009 1,080 17.00 18,360 1.38 0.00 35.24 Janus Aspen Balanced 2013 44,471 22.32 992,702 1.28 0.00 19.80 Investment Division 2012 59,065 18.63 1,100,549 2.26 0.00 13.37 2011 81,522 16.43 1,339,788 2.04 0.00 1.36 2010 155,834 16.22 2,526,859 2.71 0.00 8.12 2009 99,381 15.00 1,490,464 2.93 0.00 25.58 Janus Aspen Forty 2013 34,817 24.99 870,003 0.58 0.00 30.89 Investment Division 2012 46,505 19.09 887,847 0.56 0.00 23.86 2011 45,616 15.41 703,136 0.24 0.00 (6.94) 2010 73,218 16.56 1,212,768 0.24 0.00 6.48 2009 61,130 15.56 950,941 0.01 0.00 46.01
207 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY NOTES TO THE FINANCIAL STATEMENTS -- (CONTINUED) 8. FINANCIAL HIGHLIGHTS -- (CONTINUED)
AS OF DECEMBER 31 FOR THE YEAR ENDED DECEMBER 31 --------------------------------------- ------------------------------------------------ UNIT VALUE INVESTMENT(1) EXPENSE RATIO(2) TOTAL RETURN(3) LOWEST TO NET INCOME LOWEST TO LOWEST TO UNITS HIGHEST ($) ASSETS ($) RATIO (%) HIGHEST (%) HIGHEST (%) ---------- -------------- ----------- ------------- ---------------- --------------- Janus Aspen Janus 2013 28,415 15.46 439,285 0.89 0.00 30.34 Investment Division 2012 81,921 11.86 971,677 0.56 0.00 18.59 2011 85,791 10.00 858,094 0.24 0.00 (5.30) 2010 741,523 10.56 7,832,002 1.09 0.00 14.52 2009 718,894 9.22 6,630,451 0.54 0.00 36.35 Janus Aspen Overseas 2013 2,403 28.65 68,836 3.03 0.00 14.28 Investment Division 2012 17,627 25.07 441,942 0.63 0.00 13.18 2011 15,536 22.15 344,135 0.10 0.00 (32.34) 2010 11,481 32.74 375,851 0.73 0.00 25.02 2009 3,135 26.19 82,093 0.46 0.00 79.07 MFS VIT Global Equity 2013 7,761 23.88 185,320 0.76 0.00 27.52 Investment Division 2012 7,233 18.72 135,428 0.22 0.00 22.98 2011 356 15.23 5,414 0.67 0.00 (4.53) 2010 14,222 15.95 226,794 0.78 0.00 12.05 2009 5,543 14.23 78,884 2.04 0.00 31.80 MFS VIT New Discovery 2013 8,721 26.39 230,115 -- 0.00 41.22 Investment Division 2012 9,204 18.68 171,983 -- 0.00 20.90 2011 7,919 15.46 122,395 -- 0.00 (10.49) 2010 7,814 17.27 134,923 -- 0.00 35.94 2009 396 12.70 5,029 -- 0.00 62.92 MFS VIT Value Investment 2013 978 22.18 21,702 1.01 0.00 35.59 Division 2012 1,049 16.36 17,162 1.77 0.00 15.88 2011 3,138 14.12 44,299 1.45 0.00 (0.47) 2010 5,577 14.18 79,095 1.32 0.00 11.22 2009 5,803 12.75 74,001 1.24 0.00 22.45 MFS VIT II High Yield 2013 8,075 18.50 149,361 2.22 0.00 3.84 Investment Division (Commenced 8/19/2013) MIST AllianceBernstein 2013 2,847 12.03 34,236 0.59 0.00 11.15 Global Dynamic Allocation 2012 656 10.82 7,098 -- 0.00 4.39 Investment Division (Commenced 4/30/2012) MIST American Funds 2013 57,458 13.75 790,263 1.64 0.00 18.91 Balanced Allocation 2012 54,591 11.57 631,423 1.94 0.00 13.80 Investment Division 2011 50,766 10.16 515,995 1.44 0.00 (1.80) 2010 41,296 10.35 427,406 1.26 0.00 12.40 2009 23,102 9.21 212,728 -- 0.00 30.06 MIST American Funds Growth 2013 108,102 13.79 1,490,834 1.27 0.00 25.44 Allocation Investment 2012 84,318 10.99 926,978 1.55 0.00 16.54 Division 2011 82,817 9.43 781,245 1.38 0.00 (4.41) 2010 71,574 9.87 706,300 0.62 0.00 13.78 2009 15,564 8.67 134,986 -- 0.00 34.36
208 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY NOTES TO THE FINANCIAL STATEMENTS -- (CONTINUED) 8. FINANCIAL HIGHLIGHTS -- (CONTINUED)
AS OF DECEMBER 31 ------------------------------------------ UNIT VALUE LOWEST TO NET UNITS HIGHEST ($) ASSETS ($) ----------- --------------- ------------ MIST American Funds 2013 64,895 13.48 874,921 Moderate Allocation 2012 49,584 11.85 587,686 Investment Division 2011 37,706 10.65 401,606 2010 23,584 10.60 250,094 2009 9,961 9.63 95,893 MIST AQR Global Risk 2013 15,059 10.15 152,914 Balanced Investment 2012 2,358 10.51 24,784 Division (Commenced 4/30/2012) MIST BlackRock Global 2013 8,821 11.63 102,574 Tactical Strategies 2012 3,707 10.54 39,078 Investment Division (Commenced 4/30/2012) MIST BlackRock Large Cap 2013 11,184,832 12.78 - 55.10 385,342,945 Core Investment Division 2012 11,913,338 9.54 - 41.30 307,558,825 2011 12,762,727 8.43 - 36.66 291,615,739 2010 13,468,383 8.42 - 36.79 309,489,536 2009 14,107,746 7.50 - 32.93 291,577,776 MIST Clarion Global Real 2013 1,412,669 18.10 - 19.74 27,497,715 Estate Investment Division 2012 1,388,419 17.60 - 19.03 26,083,318 2011 1,311,823 14.06 - 15.06 19,560,387 2010 1,342,988 14.98 - 15.90 21,160,564 2009 1,332,507 13.00 - 13.68 18,066,465 MIST ClearBridge Aggressive 2013 1,008,221 15.68 - 521.79 18,676,041 Growth II Investment Division 2012 1,085,660 12.25 - 404.14 15,566,776 2011 1,093,634 10.07 - 329.01 12,484,277 2010 1,185,626 10.96 - 355.01 14,254,655 2009 1,122,196 10.08 - 323.68 12,100,411 MIST ClearBridge Aggressive 2013 1,375,745 13.83 - 16.25 21,684,945 Growth Investment Division 2012 1,313,742 9.48 - 11.14 14,226,385 2011 1,353,551 7.98 - 9.38 12,365,794 2010 888,257 7.56 - 9.05 7,832,576 2009 918,435 6.11 - 7.30 6,533,459 MIST Harris Oakmark 2013 1,980,844 16.14 - 31.64 52,830,774 International Investment 2012 1,421,965 12.34 - 24.19 33,602,695 Division 2011 1,483,192 9.53 - 18.68 27,216,742 2010 1,473,309 20.09 - 21.72 31,544,698 2009 1,439,875 17.38 - 18.61 26,459,351 MIST Invesco Balanced-Risk 2013 22,938 1.08 24,723 Allocation Investment 2012 7,100 1.06 7,513 Division (Commenced 4/30/2012) FOR THE YEAR ENDED DECEMBER 31 -------------------------------------------------- INVESTMENT(1) EXPENSE RATIO(2) TOTAL RETURN(3) INCOME LOWEST TO LOWEST TO RATIO (%) HIGHEST (%) HIGHEST (%) ------------- ---------------- ----------------- MIST American Funds 2013 1.90 0.00 13.75 Moderate Allocation 2012 2.15 0.00 11.28 Investment Division 2011 1.66 0.00 0.44 2010 1.38 0.00 10.15 2009 -- 0.00 23.90 MIST AQR Global Risk 2013 1.78 0.00 (3.39) Balanced Investment 2012 -- 0.00 4.63 Division (Commenced 4/30/2012) MIST BlackRock Global 2013 1.20 0.00 10.31 Tactical Strategies 2012 -- 0.00 4.21 Investment Division (Commenced 4/30/2012) MIST BlackRock Large Cap 2013 1.41 0.00 - 0.90 33.40 - 34.60 Core Investment Division 2012 1.21 0.00 - 0.90 12.66 - 13.68 2011 1.12 0.00 - 0.90 (0.36) - 0.54 2010 1.34 0.00 - 0.90 11.73 - 12.73 2009 1.61 0.45 - 0.90 18.37 - 19.43 MIST Clarion Global Real 2013 6.88 0.00 - 0.90 2.83 - 3.76 Estate Investment Division 2012 2.22 0.00 - 0.90 25.16 - 26.30 2011 4.03 0.00 - 0.90 (6.12) - (5.28) 2010 8.28 0.00 - 0.90 15.24 - 16.28 2009 3.50 0.90 33.91 - 35.12 MIST ClearBridge Aggressive 2013 0.77 0.00 - 0.90 27.96 - 29.11 Growth II Investment Division 2012 0.43 0.00 - 0.90 21.73 - 22.83 2011 1.80 0.00 - 0.90 (8.16) - (7.32) 2010 1.71 0.00 - 0.90 8.70 - 9.68 2009 -- 0.90 41.93 - 43.21 MIST ClearBridge Aggressive 2013 0.40 0.00 - 0.90 44.60 - 45.90 Growth Investment Division 2012 0.21 0.00 - 0.90 8.91 - 18.81 2011 0.08 0.00 - 0.90 (8.33) - 3.56 2010 0.06 0.00 - 0.90 22.94 - 24.05 2009 0.12 0.90 32.26 - 33.45 MIST Harris Oakmark 2013 2.71 0.00 - 0.90 29.63 - 30.80 International Investment 2012 1.82 0.00 - 0.90 28.31 - 29.47 Division 2011 0.03 0.00 - 0.90 (14.75) - (13.98) 2010 2.05 0.00 - 0.90 15.63 - 16.67 2009 7.87 0.90 54.07 - 55.46 MIST Invesco Balanced-Risk 2013 -- 0.00 1.86 Allocation Investment 2012 0.66 0.00 4.67 Division (Commenced 4/30/2012)
209 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY NOTES TO THE FINANCIAL STATEMENTS -- (CONTINUED) 8. FINANCIAL HIGHLIGHTS -- (CONTINUED)
AS OF DECEMBER 31 ------------------------------------------ UNIT VALUE LOWEST TO NET UNITS HIGHEST ($) ASSETS ($) ----------- --------------- ------------ MIST Invesco Mid Cap Value 2013 2,707,441 20.16 - 42.94 92,130,609 Investment Division 2012 2,873,152 15.40 - 32.87 74,892,920 2011 9,000 13.43 120,858 2010 7,974 13.94 111,190 2009 9,319 11.11 103,521 MIST Invesco Small Cap 2013 251,143 24.20 - 30.45 6,613,228 Growth Investment Division 2012 245,733 17.38 - 21.67 4,616,668 2011 279,254 14.80 - 18.28 4,412,967 2010 280,254 15.06 - 18.44 4,469,898 2009 268,049 12.01 - 14.58 3,392,636 MIST JPMorgan Global Active 2013 93,835 1.18 110,413 Allocation Investment 2012 17,811 1.06 18,883 Division (Commenced 4/30/2012) MIST JPMorgan Small Cap 2013 11,410 22.33 254,799 Value Investment Division 2012 2,300 16.76 38,553 2011 2,480 14.49 35,938 2010 1,705 16.12 27,489 2009 1,271 13.49 17,136 MIST Loomis Sayles Global 2013 21,834 19.16 418,260 Markets Investment Division (Commenced 4/29/2013) MIST Lord Abbett Bond 2013 1,003,912 24.67 - 37.84 29,124,114 Debenture Investment 2012 1,063,203 23.01 - 34.98 28,515,095 Division 2011 1,085,311 20.52 - 30.90 25,730,993 2010 1,222,207 19.75 - 29.48 27,673,730 2009 1,300,112 17.61 - 26.05 26,033,742 MIST Met/Templeton 2013 5,967 14.54 86,776 International Bond 2012 181 14.36 2,605 Investment Division (Commenced 4/30/2012) MIST MetLife Aggressive 2013 1,065,070 16.36 - 172.88 19,271,452 Strategy Investment Division 2012 1,085,674 12.72 - 133.49 15,142,596 (Commenced 5/2/2011) 2011 1,049,786 10.97 - 114.35 12,472,661 MIST MetLife Balanced Plus 2013 7,685 12.25 94,166 Investment Division 2012 4,287 10.71 45,933 (Commenced 4/30/2012) MIST MetLife Growth Strategy 2013 20,720 18.47 382,762 Investment Division (Commenced 4/29/2013) MIST MetLife Multi-Index 2013 23 114.75 2,679 Targeted Risk Investment Division (Commenced 4/29/2013) FOR THE YEAR ENDED DECEMBER 31 -------------------------------------------------- INVESTMENT(1) EXPENSE RATIO(2) TOTAL RETURN(3) INCOME LOWEST TO LOWEST TO RATIO (%) HIGHEST (%) HIGHEST (%) ------------- ---------------- ----------------- MIST Invesco Mid Cap Value 2013 0.90 0.00 - 0.90 29.46 - 30.87 Investment Division 2012 -- 0.00 2.78 - 3.71 2011 0.53 0.00 (3.69) 2010 0.58 0.00 25.53 2009 2.10 0.00 26.53 MIST Invesco Small Cap 2013 0.40 0.00 - 0.90 39.28 - 40.54 Growth Investment Division 2012 -- 0.00 - 0.90 17.44 - 18.51 2011 -- 0.00 - 0.90 (1.73) - (0.85) 2010 -- 0.00 - 0.90 25.34 - 26.47 2009 -- 0.90 33.01 - 34.21 MIST JPMorgan Global Active 2013 0.06 0.00 10.99 Allocation Investment 2012 1.08 0.00 4.66 Division (Commenced 4/30/2012) MIST JPMorgan Small Cap 2013 0.27 0.00 33.25 Value Investment Division 2012 0.95 0.00 15.66 2011 1.63 0.00 (10.12) 2010 0.82 0.00 19.53 2009 -- 0.00 29.09 MIST Loomis Sayles Global 2013 -- 0.00 17.34 Markets Investment Division (Commenced 4/29/2013) MIST Lord Abbett Bond 2013 6.78 0.00 - 0.90 7.20 - 8.17 Debenture Investment 2012 7.24 0.00 - 0.90 12.17 - 13.19 Division 2011 5.96 0.00 - 0.90 3.89 - 4.83 2010 6.47 0.00 - 0.90 12.16 - 13.18 2009 7.18 0.45 - 0.90 35.89 - 37.12 MIST Met/Templeton 2013 0.68 0.00 1.27 International Bond 2012 -- 0.00 8.00 Investment Division (Commenced 4/30/2012) MIST MetLife Aggressive 2013 0.93 0.00 - 0.90 28.61 - 29.77 Strategy Investment Division 2012 0.85 0.00 - 0.90 (0.17) - 3.96 (Commenced 5/2/2011) 2011 -- 0.00 - 0.90 (13.94) - (10.95) MIST MetLife Balanced Plus 2013 1.11 0.00 14.36 Investment Division 2012 -- 0.00 5.63 (Commenced 4/30/2012) MIST MetLife Growth Strategy 2013 -- 0.00 26.26 Investment Division (Commenced 4/29/2013) MIST MetLife Multi-Index 2013 0.24 0.00 6.63 Targeted Risk Investment Division (Commenced 4/29/2013)
210 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY NOTES TO THE FINANCIAL STATEMENTS -- (CONTINUED) 8. FINANCIAL HIGHLIGHTS -- (CONTINUED)
AS OF DECEMBER 31 ------------------------------------------- UNIT VALUE LOWEST TO NET UNITS HIGHEST ($) ASSETS ($) ----------- ---------------- ------------ MIST MFS Emerging Markets 2013 21,705 12.57 272,836 Equity Investment Division 2012 6,737 13.20 88,957 (Commenced 5/2/2011) 2011 2,070 11.09 22,950 MIST MFS Research 2013 1,065,499 18.19 - 21.34 21,367,741 International Investment 2012 920,691 15.26 - 17.85 15,720,813 Division 2011 820,338 13.07 - 15.26 12,176,899 2010 838,110 14.64 - 17.04 13,920,818 2009 885,756 13.14 - 15.26 13,178,754 MIST Morgan Stanley Mid Cap 2013 11,170,989 9.50 - 26.66 244,413,959 Growth Investment Division 2012 11,831,703 6.82 - 19.14 186,491,111 2011 12,356,734 6.22 - 17.47 178,350,417 2010 13,121,650 6.67 - 18.71 203,754,931 2009 23,317 13.14 - 14.13 306,427 MIST Oppenheimer 2013 1,679,985 28.72 - 33.41 50,486,885 Global Equity Investment 2012 1,769,256 22.75 - 26.22 41,848,339 Division 2011 1,918,512 18.89 - 21.58 37,497,219 2010 2,044,692 20.77 - 23.52 43,706,570 2009 2,111,250 18.03 - 20.23 38,882,417 MIST PIMCO Inflation 2013 755,274 11.51 - 17.34 11,213,500 Protected Bond Investment 2012 837,709 12.64 - 19.05 13,671,560 Division 2011 700,157 11.56 - 17.42 10,519,501 2010 653,613 12.97 - 15.63 8,812,538 2009 618,801 12.12 - 14.47 7,734,444 MIST PIMCO Total Return 2013 2,464,593 11.62 - 21.48 49,962,747 Investment Division 2012 2,365,572 11.82 - 21.86 50,485,893 2011 2,427,091 10.79 - 19.95 47,131,879 2010 2,450,427 17.69 - 19.29 46,602,262 2009 2,378,221 16.46 - 17.80 41,820,317 MIST Pioneer Fund 2013 10,624 19.25 204,562 Investment Division 2012 13,454 14.47 194,664 (Commenced 5/4/2009) 2011 13,480 13.08 176,354 2010 17,938 13.71 245,860 2009 20,277 11.79 239,136 MIST Pyramis Managed Risk 2013 3 108.59 298 Investment Division (Commenced 4/29/2013) MIST Schroders Global 2013 19,086 1.19 22,665 Multi-Asset Investment 2012 5,334 1.08 5,752 Division (Commenced 4/30/2012) MIST SSgA Growth and Income 2013 503,743 14.53 - 16.52 7,827,724 ETF Investment Division 2012 450,776 12.95 - 14.59 6,167,640 2011 381,525 11.55 - 12.90 4,611,127 2010 320,284 11.51 - 12.74 3,818,907 2009 149,333 10.31 - 11.31 1,581,109 FOR THE YEAR ENDED DECEMBER 31 -------------------------------------------------- INVESTMENT(1) EXPENSE RATIO(2) TOTAL RETURN(3) INCOME LOWEST TO LOWEST TO RATIO (%) HIGHEST (%) HIGHEST (%) ------------- ---------------- ----------------- MIST MFS Emerging Markets 2013 0.98 0.00 (4.80) Equity Investment Division 2012 1.57 0.00 19.10 (Commenced 5/2/2011) 2011 -- 0.00 (22.19) MIST MFS Research 2013 2.53 0.00 - 0.90 18.51 - 19.58 International Investment 2012 2.10 0.00 - 0.90 15.92 - 16.97 Division 2011 2.07 0.00 - 0.90 (11.23) - (10.44) 2010 1.89 0.00 - 0.90 10.65 - 11.65 2009 3.35 0.90 30.75 - 31.93 MIST Morgan Stanley Mid Cap 2013 0.79 0.00 - 0.90 38.06 - 39.30 Growth Investment Division 2012 -- 0.00 - 0.90 8.57 - 9.55 2011 0.73 0.00 - 0.90 (7.50) - (6.67) 2010 -- 0.00 - 0.90 17.91 - 32.19 2009 -- 0.00 57.27 - 57.83 MIST Oppenheimer 2013 2.05 0.00 - 0.90 26.28 - 27.42 Global Equity Investment 2012 1.64 0.00 - 0.90 20.42 - 21.52 Division 2011 1.98 0.00 - 0.90 (9.05) - (8.24) 2010 1.54 0.00 - 0.90 15.19 - 16.23 2009 2.57 0.45 - 0.90 39.06 - 40.31 MIST PIMCO Inflation 2013 2.44 0.00 - 0.90 (9.80) - (8.98) Protected Bond Investment 2012 3.14 0.00 - 0.90 8.34 - 20.51 Division 2011 1.74 0.00 - 0.90 10.23 - 11.49 2010 2.54 0.00 - 0.90 7.04 - 8.00 2009 3.75 0.90 17.31 - 18.37 MIST PIMCO Total Return 2013 4.38 0.00 - 0.90 (2.60) - (1.72) Investment Division 2012 3.30 0.00 - 0.90 8.57 - 9.56 2011 2.84 0.00 - 0.90 2.50 - 3.42 2010 3.66 0.00 - 0.90 7.44 - 8.41 2009 7.36 0.90 17.33 - 18.39 MIST Pioneer Fund 2013 3.20 0.00 33.08 Investment Division 2012 1.53 0.00 10.59 (Commenced 5/4/2009) 2011 1.21 0.00 (4.55) 2010 0.90 0.00 17.93 2009 -- 0.00 17.93 MIST Pyramis Managed Risk 2013 1.24 0.00 7.52 Investment Division (Commenced 4/29/2013) MIST Schroders Global 2013 0.01 0.00 10.11 Multi-Asset Investment 2012 1.48 0.00 6.68 Division (Commenced 4/30/2012) MIST SSgA Growth and Income 2013 2.65 0.00 - 0.90 12.21 - 13.22 ETF Investment Division 2012 2.40 0.00 - 0.90 12.09 - 13.11 2011 1.79 0.00 - 0.90 0.37 - 1.28 2010 1.29 0.00 - 0.90 11.60 - 12.61 2009 1.61 0.90 23.84 - 24.96
211 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY NOTES TO THE FINANCIAL STATEMENTS -- (CONTINUED) 8. FINANCIAL HIGHLIGHTS -- (CONTINUED)
AS OF DECEMBER 31 ------------------------------------------ UNIT VALUE LOWEST TO NET UNITS HIGHEST ($) ASSETS ($) ----------- --------------- ------------ MIST SSgA Growth ETF 2013 366,821 14.19 - 16.45 5,570,220 Investment Division 2012 332,667 12.10 - 13.90 4,244,488 2011 299,115 10.59 - 12.05 3,309,518 2010 237,751 10.89 - 12.28 2,679,381 2009 181,473 9.61 - 10.74 1,789,007 MIST T. Rowe Price Large 2013 128,280 15.79 2,025,987 Cap Value Investment 2012 112,114 11.78 1,320,515 Division 2011 108,604 9.96 1,081,554 2010 601,441 10.35 6,224,061 2009 585,353 8.82 5,163,011 MIST T. Rowe Price Mid Cap 2013 1,482,938 16.97 - 27.99 27,748,656 Growth Investment Division 2012 1,544,904 12.50 - 20.49 21,145,655 2011 1,957,835 11.07 - 18.03 25,204,627 2010 1,725,748 11.33 - 18.33 21,234,908 2009 1,754,850 8.93 - 14.35 16,772,681 MIST Third Avenue Small Cap 2013 41,430 23.12 957,820 Value Investment Division 2012 50,513 17.46 881,737 2011 54,483 14.79 806,051 2010 96,930 16.25 1,575,589 2009 66,457 13.56 900,994 MSF Baillie Gifford 2013 2,695,199 13.71 - 20.73 44,856,340 International Stock 2012 2,785,901 11.92 - 17.95 40,399,665 Investment Division 2011 2,947,427 10.02 - 15.01 35,919,561 2010 2,985,340 12.56 - 18.74 45,766,876 2009 3,130,833 11.77 - 17.48 45,163,862 MSF Barclays Aggregate Bond 2013 5,904,440 17.79 - 20.85 121,423,866 Index Investment Division 2012 5,528,875 18.38 - 21.34 116,415,557 2011 5,367,889 17.85 - 20.54 108,763,587 2010 6,069,208 16.75 - 19.11 114,484,755 2009 5,979,612 15.94 - 18.02 106,351,639 MSF BlackRock Bond Income 2013 3,164,737 19.93 - 94.36 81,249,803 Investment Division 2012 3,286,524 20.08 - 95.09 85,513,325 2011 3,448,815 18.67 - 88.42 84,065,205 2010 3,695,898 17.52 - 82.97 84,862,836 2009 3,849,026 16.17 - 76.59 82,419,233 MSF BlackRock Capital 2013 1,238,069 14.32 - 57.65 20,880,180 Appreciation Investment 2012 1,083,757 10.67 - 42.95 14,012,099 Division 2011 533,802 9.33 - 37.56 7,367,810 2010 494,998 10.25 - 41.25 7,322,523 2009 480,438 8.55 - 34.42 5,950,495 MSF BlackRock Diversified 2013 9,093,665 21.00 - 84.97 302,812,153 Investment Division 2012 9,597,280 17.41 - 70.46 266,981,783 2011 10,223,668 15.50 - 62.70 255,554,192 2010 10,826,228 14.93 - 60.41 263,102,316 2009 11,480,151 13.61 - 55.09 257,391,816 FOR THE YEAR ENDED DECEMBER 31 -------------------------------------------------- INVESTMENT(1) EXPENSE RATIO(2) TOTAL RETURN(3) INCOME LOWEST TO LOWEST TO RATIO (%) HIGHEST (%) HIGHEST (%) ------------- ---------------- ----------------- MIST SSgA Growth ETF 2013 2.22 0.00 - 0.90 17.28 - 18.34 Investment Division 2012 2.07 0.00 - 0.90 14.28 - 15.32 2011 1.76 0.00 - 0.90 (2.75) - (1.86) 2010 1.57 0.00 - 0.90 13.35 - 14.37 2009 1.53 0.90 28.34 - 29.51 MIST T. Rowe Price Large 2013 1.68 0.00 34.09 Cap Value Investment 2012 1.62 0.00 18.27 Division 2011 0.51 0.00 (3.77) 2010 1.22 0.00 17.33 2009 2.45 0.00 18.67 MIST T. Rowe Price Mid Cap 2013 0.40 0.00 - 0.90 35.73 - 36.96 Growth Investment Division 2012 -- 0.00 - 0.90 12.90 - 13.93 2011 -- 0.00 - 0.90 (2.28) - (1.39) 2010 -- 0.00 - 0.90 26.93 - 28.07 2009 -- 0.90 44.54 - 45.85 MIST Third Avenue Small Cap 2013 1.08 0.00 32.45 Value Investment Division 2012 -- 0.00 17.99 2011 0.92 0.00 (8.98) 2010 1.05 0.00 19.90 2009 0.62 0.00 26.45 MSF Baillie Gifford 2013 1.61 0.00 - 0.90 14.51 - 15.54 International Stock 2012 1.37 0.00 - 0.90 18.44 - 19.52 Investment Division 2011 1.77 0.00 - 0.90 (20.59) - (19.87) 2010 1.57 0.00 - 0.90 6.25 - 7.21 2009 0.71 0.45 - 0.90 21.07 - 22.17 MSF Barclays Aggregate Bond 2013 3.51 0.00 - 0.90 (3.20) - (2.33) Index Investment Division 2012 3.71 0.00 - 0.90 2.97 - 3.90 2011 3.52 0.00 - 0.90 6.55 - 7.51 2010 3.72 0.00 - 0.90 5.10 - 6.05 2009 5.95 0.45 - 0.90 4.22 - 5.17 MSF BlackRock Bond Income 2013 3.96 0.00 - 0.90 (1.66) - (0.77) Investment Division 2012 2.69 0.00 - 0.90 6.58 - 7.55 2011 3.92 0.00 - 0.90 5.61 - 6.56 2010 3.95 0.00 - 0.90 7.37 - 8.34 2009 7.04 0.45 - 0.90 8.49 - 9.47 MSF BlackRock Capital 2013 0.83 0.00 - 0.90 33.02 - 34.22 Appreciation Investment 2012 0.31 0.00 - 0.90 13.34 - 14.37 Division 2011 0.19 0.00 - 0.90 (9.76) - (8.94) 2010 0.23 0.00 - 0.90 18.75 - 19.82 2009 0.62 0.90 35.56 - 36.79 MSF BlackRock Diversified 2013 2.46 0.00 - 0.90 19.51 - 20.59 Investment Division 2012 2.28 0.00 - 0.90 11.36 - 12.38 2011 2.43 0.00 - 0.90 2.87 - 3.81 2010 1.90 0.00 - 0.90 8.67 - 9.65 2009 5.15 0.45 - 0.90 16.25 - 17.30
212 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY NOTES TO THE FINANCIAL STATEMENTS -- (CONTINUED) 8. FINANCIAL HIGHLIGHTS -- (CONTINUED)
AS OF DECEMBER 31 FOR THE YEAR ENDED DECEMBER 31 ------------------------------------------ ------------------------------------------------- UNIT VALUE INVESTMENT(1) EXPENSE RATIO(2) TOTAL RETURN(3) LOWEST TO NET INCOME LOWEST TO LOWEST TO UNITS HIGHEST ($) ASSETS ($) RATIO (%) HIGHEST (%) HIGHEST (%) ----------- --------------- ------------ ------------- ---------------- ---------------- MSF BlackRock Large Cap 2013 952,777 17.71 - 19.67 18,457,575 1.36 0.00 - 0.90 30.87 - 32.05 Value Investment Division 2012 972,398 13.53 - 14.89 14,290,950 1.63 0.00 - 0.90 13.25 - 14.28 2011 1,036,664 11.95 - 13.03 13,313,052 1.11 0.00 - 0.90 1.43 - 2.35 2010 1,026,360 11.78 - 12.73 12,899,137 1.05 0.00 - 0.90 8.24 - 9.22 2009 1,018,697 10.88 - 11.66 11,723,889 1.58 0.90 10.22 - 11.21 MSF BlackRock Money Market 2013 1,334,062 17.19 - 17.98 23,781,879 -- 0.00 - 0.90 (0.90) - 0.00 Investment Division 2012 1,306,002 17.35 - 17.98 23,274,454 -- 0.00 - 0.90 (0.90) - 0.00 2011 1,163,332 17.51 - 17.98 20,783,208 -- 0.00 - 0.90 (0.89) - 0.00 2010 1,663,896 17.66 - 17.98 29,818,336 0.01 0.00 - 0.90 (0.89) - 0.01 2009 1,962,757 17.82 - 17.98 35,228,518 0.45 0.90 (0.48) - 0.42 MSF Davis Venture Value 2013 1,389,950 18.87 - 62.33 72,729,703 1.37 0.00 - 0.90 32.50 - 33.70 Investment Division 2012 1,511,861 14.11 - 46.62 58,219,352 0.83 0.00 - 0.90 11.85 - 12.86 2011 1,569,723 12.50 - 41.31 53,650,792 1.15 0.00 - 0.90 (4.89) - (4.03) 2010 1,632,869 13.03 - 43.04 57,910,618 1.00 0.00 - 0.90 11.00 - 12.00 2009 1,661,533 11.63 - 38.43 52,773,242 1.57 0.90 30.80 - 31.99 MSF Frontier Mid Cap Growth 2013 7,328,205 24.52 - 93.40 227,974,022 1.25 0.00 - 0.90 31.58 - 32.77 Investment Division 2012 8,053,406 18.55 - 70.35 190,699,476 -- 0.00 - 0.90 9.98 - 10.97 2011 8,613,267 16.80 - 63.39 184,990,795 0.30 0.00 - 0.90 (3.87) - (3.00) 2010 9,010,506 17.39 - 65.35 200,141,525 0.07 0.00 - 0.90 14.27 - 15.30 2009 9,655,662 15.15 - 56.68 187,532,635 0.20 0.45 - 0.90 48.10 - 49.44 MSF Jennison Growth 2013 1,014,111 10.27 - 22.67 21,754,126 0.41 0.00 - 0.90 35.77 - 37.00 Investment Division 2012 1,151,518 7.50 - 16.55 17,774,611 0.22 0.00 - 0.90 14.74 - 15.78 2011 1,066,474 6.47 - 14.29 14,166,486 0.28 0.00 - 0.90 (0.39) - 0.51 2010 1,234,658 6.44 - 14.22 15,408,401 0.59 0.00 - 0.90 10.63 - 11.66 2009 1,148,604 5.77 - 12.74 13,473,347 0.19 0.90 38.73 - 39.99 MSF Loomis Sayles Small Cap 2013 81,272 26.07 - 577.53 25,008,758 0.43 0.00 - 0.90 39.78 - 41.04 Core Investment Division 2012 88,479 18.49 - 409.49 18,836,597 -- 0.00 - 0.90 13.52 - 14.55 2011 95,949 16.14 - 357.46 17,443,984 0.11 0.00 - 0.90 (0.31) - 0.59 2010 115,539 16.04 - 355.36 18,282,784 0.09 0.00 - 0.90 26.38 - 27.53 2009 116,312 12.58 - 278.66 14,825,414 0.28 0.90 29.08 - 30.25 MSF Loomis Sayles Small Cap 2013 575,475 19.06 - 21.35 12,136,657 -- 0.00 - 0.90 47.37 - 48.70 Growth Investment Division 2012 569,420 12.93 - 14.36 8,095,037 -- 0.00 - 0.90 10.19 - 11.19 2011 639,754 11.74 - 12.92 8,179,779 -- 0.00 - 0.90 2.06 - 2.98 2010 597,616 11.50 - 12.54 7,430,441 -- 0.00 - 0.90 30.53 - 31.71 2009 592,149 8.22 - 9.52 5,593,368 -- 0.90 28.77 - 38.63 MSF Met/Artisan Mid Cap 2013 179,229 28.55 - 409.68 64,604,740 0.96 0.00 - 0.90 35.63 - 36.85 Value Investment Division 2012 188,777 20.91 - 299.35 50,145,783 0.99 0.00 - 0.90 10.86 - 11.86 2011 187,483 18.74 - 267.60 47,188,989 0.95 0.00 - 0.90 5.80 - 6.76 2010 222,836 17.60 - 250.67 46,601,141 0.74 0.00 - 0.90 7.99 - 15.04 2009 191,339 35.18 - 217.89 41,071,915 1.13 0.90 40.30 - 41.56 MSF MetLife Conservative 2013 302,268 14.80 - 156.63 5,157,553 3.17 0.00 - 0.90 3.57 - 4.50 Allocation Investment 2012 330,868 14.29 - 150.19 5,385,935 2.97 0.00 - 0.90 8.50 - 9.49 Division 2011 293,962 13.17 - 137.56 4,371,255 2.46 0.00 - 0.90 2.55 - 3.48 2010 281,025 12.84 - 133.23 4,036,496 3.52 0.00 - 0.90 9.35 - 10.34 2009 179,332 11.74 - 121.06 2,188,237 3.20 0.90 19.65 - 20.73
213 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY NOTES TO THE FINANCIAL STATEMENTS -- (CONTINUED) 8. FINANCIAL HIGHLIGHTS -- (CONTINUED)
AS OF DECEMBER 31 ------------------------------------------ UNIT VALUE LOWEST TO NET UNITS HIGHEST ($) ASSETS ($) ----------- --------------- ------------ MSF MetLife Conservative to 2013 528,645 15.56 - 164.48 9,308,532 Moderate Allocation 2012 548,694 14.12 - 148.28 8,676,630 Investment Division 2011 491,119 12.75 - 133.03 6,564,562 2010 523,187 12.70 - 131.65 6,925,701 2009 443,689 11.47 - 118.05 5,262,543 MSF MetLife Mid Cap Stock 2013 3,096,714 28.17 - 31.80 96,112,727 Index Investment Division 2012 2,971,386 21.35 - 23.88 69,807,817 2011 3,140,839 18.32 - 20.31 62,847,615 2010 3,223,737 18.84 - 20.70 65,796,062 2009 3,313,158 14.93 - 16.39 53,691,851 MSF MetLife Moderate 2013 2,959,238 16.11 - 170.50 51,411,065 Allocation Investment 2012 3,085,848 13.74 - 144.51 45,401,738 Division 2011 3,050,810 12.22 - 127.62 39,588,309 2010 2,825,563 12.48 - 129.39 37,214,331 2009 2,488,914 11.09 - 114.33 28,790,175 MSF MetLife Moderate to 2013 5,304,870 16.46 - 17.80 93,658,356 Aggressive Allocation 2012 5,433,641 13.34 - 14.29 77,039,719 Investment Division 2011 5,400,236 11.62 - 12.34 66,170,247 2010 5,118,269 12.16 - 126.24 65,064,069 2009 4,732,679 10.68 - 110.06 52,449,221 MSF MetLife Stock Index 2013 33,504,283 19.11 - 85.59 926,254,934 Investment Division 2012 35,058,600 14.48 - 64.83 739,806,231 2011 36,301,700 12.50 - 56.01 668,626,167 2010 36,664,506 12.28 - 55.00 671,751,965 2009 36,924,505 10.69 - 47.90 597,707,546 MSF MFS Total Return 2013 516,460 16.89 - 90.12 9,566,029 Investment Division 2012 523,594 14.32 - 75.73 8,143,436 2011 528,477 12.95 - 67.87 7,362,338 2010 568,106 12.76 - 66.27 7,708,272 2009 580,613 11.70 - 60.20 7,134,157 MSF MFS Value Investment 2013 3,880,440 19.62 - 28.81 83,882,181 Division 2012 3,634,888 14.55 - 21.23 57,891,425 2011 3,828,828 12.53 - 18.20 52,363,369 2010 3,975,344 12.48 - 18.04 54,052,850 2009 4,056,273 11.25 - 16.19 49,365,491 MSF MSCI EAFE Index 2013 4,619,766 13.79 - 19.92 81,042,858 Investment Division 2012 4,738,737 11.42 - 16.34 68,221,885 2011 4,910,651 9.74 - 13.81 59,759,550 2010 4,717,340 11.23 - 15.78 65,367,829 2009 4,618,467 10.47 - 14.59 58,913,857 MSF Neuberger Berman 2013 3,669,017 27.67 - 31.24 113,031,475 Genesis Investment Division 2012 3,701,342 20.16 - 22.55 82,409,606 2011 3,915,596 18.49 - 20.50 79,279,066 2010 4,111,864 17.63 - 19.37 78,718,096 2009 4,279,459 14.59 - 15.93 67,433,059 FOR THE YEAR ENDED DECEMBER 31 -------------------------------------------------- INVESTMENT(1) EXPENSE RATIO(2) TOTAL RETURN(3) INCOME LOWEST TO LOWEST TO RATIO (%) HIGHEST (%) HIGHEST (%) ------------- ---------------- ----------------- MSF MetLife Conservative to 2013 2.71 0.00 - 0.90 10.20 - 11.20 Moderate Allocation 2012 2.88 0.00 - 0.90 10.73 - 11.74 Investment Division 2011 2.28 0.00 - 0.90 0.37 - 1.28 2010 3.39 0.00 - 0.90 10.78 - 11.78 2009 3.27 0.90 22.89 - 24.00 MSF MetLife Mid Cap Stock 2013 1.15 0.00 - 0.90 31.96 - 33.15 Index Investment Division 2012 0.99 0.00 - 0.90 16.54 - 17.60 2011 0.90 0.00 - 0.90 (2.77) - (1.89) 2010 0.99 0.00 - 0.90 25.15 - 26.28 2009 1.81 0.90 35.77 - 36.99 MSF MetLife Moderate 2013 2.13 0.00 - 0.90 17.23 - 18.29 Allocation Investment 2012 2.48 0.00 - 0.90 12.45 - 13.47 Division 2011 1.72 0.00 - 0.90 (2.02) - (1.14) 2010 2.69 0.00 - 0.90 12.45 - 13.47 2009 3.09 0.90 25.71 - 26.84 MSF MetLife Moderate to 2013 1.65 0.00 - 0.90 23.40 - 24.51 Aggressive Allocation 2012 2.10 0.00 - 0.90 14.77 - 15.82 Investment Division 2011 1.59 0.00 - 0.90 (4.42) - (3.55) 2010 2.27 0.00 - 0.90 13.86 - 14.89 2009 2.75 0.90 28.27 - 29.43 MSF MetLife Stock Index 2013 1.82 0.00 - 0.90 30.84 - 32.02 Investment Division 2012 1.76 0.00 - 0.90 14.72 - 15.76 2011 1.66 0.00 - 0.90 0.93 - 1.84 2010 1.75 0.00 - 0.90 13.79 - 14.82 2009 2.70 0.45 - 0.90 25.11 - 26.26 MSF MFS Total Return 2013 2.52 0.00 - 0.90 17.93 - 18.99 Investment Division 2012 2.81 0.00 - 0.90 10.58 - 11.58 2011 2.71 0.00 - 0.90 1.50 - 2.42 2010 3.01 0.00 - 0.90 9.09 - 10.08 2009 4.19 0.90 17.54 - 18.60 MSF MFS Value Investment 2013 1.69 0.00 - 0.90 (11.63) - 35.73 Division 2012 1.92 0.00 - 0.90 15.60 - 16.65 2011 1.56 0.00 - 0.90 (0.05) - 0.85 2010 1.43 0.00 - 0.90 10.43 - 11.42 2009 -- 0.45 - 0.90 19.74 - 20.82 MSF MSCI EAFE Index 2013 3.03 0.00 - 0.90 20.77 - 21.86 Investment Division 2012 3.07 0.00 - 0.90 17.26 - 18.33 2011 2.43 0.00 - 0.90 (13.28) - (12.50) 2010 2.68 0.00 - 0.90 7.22 - 8.19 2009 4.28 0.45 - 0.90 27.52 - 28.67 MSF Neuberger Berman 2013 0.76 0.00 - 0.90 37.28 - 38.52 Genesis Investment Division 2012 0.37 0.00 - 0.90 9.04 - 10.03 2011 0.74 0.00 - 0.90 4.85 - 5.80 2010 0.51 0.00 - 0.90 20.49 - 21.58 2009 1.12 0.90 12.14 - 13.15
214 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY NOTES TO THE FINANCIAL STATEMENTS -- (CONTINUED) 8. FINANCIAL HIGHLIGHTS -- (CONTINUED)
AS OF DECEMBER 31 ------------------------------------------ UNIT VALUE LOWEST TO NET UNITS HIGHEST ($) ASSETS ($) ----------- --------------- ------------ MSF Russell 2000 Index 2013 2,328,388 23.11 - 34.31 72,232,088 Investment Division 2012 2,492,581 16.83 - 24.76 55,930,600 2011 2,653,125 14.59 - 21.28 51,171,784 2010 2,808,600 15.35 - 22.19 56,596,227 2009 2,972,133 12.21 - 17.49 47,243,288 MSF T. Rowe Price Large Cap 2013 3,427,787 17.44 - 28.13 80,327,308 Growth Investment Division 2012 2,902,055 12.65 - 20.21 49,402,465 2011 2,954,760 10.73 - 16.99 42,317,336 2010 3,148,378 10.95 - 17.18 45,775,087 2009 3,409,767 9.44 - 14.68 42,520,597 MSF T. Rowe Price Small Cap 2013 3,406,451 33.24 - 39.29 125,276,849 Growth Investment Division 2012 3,660,384 23.20 - 27.18 93,411,008 2011 3,938,724 20.15 - 23.40 86,825,771 2010 4,055,742 19.98 - 22.99 88,004,866 2009 4,272,691 14.95 - 17.11 68,810,021 MSF Van Eck Global Natural 2013 916 185.99 170,365 Resources Investment 2012 319 167.46 53,423 Division 2011 81 162.89 13,179 (Commenced 5/2/2011) MSF Western Asset Management 2013 1,022,252 22.45 - 39.73 25,366,442 Strategic Bond Opportunities 2012 1,037,022 22.40 - 39.30 25,456,035 Investment Division 2011 1,068,823 20.28 - 35.25 23,536,888 2010 1,145,809 19.28 - 33.21 23,786,502 2009 1,115,618 17.25 - 29.46 20,580,082 MSF Western Asset Management 2013 935,377 15.89 - 24.53 16,494,249 U.S. Government 2012 936,357 16.15 - 24.71 16,622,548 Investment Division 2011 957,065 15.77 - 23.91 16,435,798 2010 1,021,769 15.08 - 22.66 16,633,651 2009 1,063,071 14.38 - 21.41 16,359,270 PIMCO VIT All Asset 2013 72,143 12.81 924,295 Investment Division 2012 10,325 12.78 131,919 (Commenced 5/2/2011) 2011 8,649 11.12 96,138 PIMCO VIT Commodity Real 2013 479 12.08 5,783 Return Strategy Investment Division (Commenced 4/29/2013) PIMCO VIT Low Duration 2013 126,188 12.44 1,570,296 Investment Division 2012 79,088 12.46 985,514 (Commenced 5/4/2009) 2011 80,364 11.77 946,008 2010 65,497 11.64 762,531 2009 66,450 11.06 734,746 Pioneer VCT Emerging 2013 13,562 19.82 268,749 Markets Investment Division 2012 33,221 20.26 673,079 2011 22,116 18.14 401,298 2010 41,431 23.75 984,166 2009 37,577 20.55 772,123 FOR THE YEAR ENDED DECEMBER 31 ------------------------------------------------- INVESTMENT(1) EXPENSE RATIO(2) TOTAL RETURN(3) INCOME LOWEST TO LOWEST TO RATIO (%) HIGHEST (%) HIGHEST (%) ------------- ---------------- ---------------- MSF Russell 2000 Index 2013 1.53 0.00 - 0.90 37.31 - 38.55 Investment Division 2012 1.15 0.00 - 0.90 15.30 - 16.35 2011 1.05 0.00 - 0.90 (4.96) - (4.10) 2010 1.10 0.00 - 0.90 25.78 - 26.92 2009 2.05 0.45 - 0.90 24.88 - 26.01 MSF T. Rowe Price Large Cap 2013 0.25 0.00 - 0.90 37.91 - 39.19 Growth Investment Division 2012 0.12 0.00 - 0.90 17.90 - 18.97 2011 0.09 0.00 - 0.90 (1.99) - (1.11) 2010 0.27 0.00 - 0.90 16.00 - 17.05 2009 0.63 0.90 42.15 - 43.44 MSF T. Rowe Price Small Cap 2013 0.34 0.00 - 0.90 43.26 - 44.55 Growth Investment Division 2012 -- 0.00 - 0.90 15.13 - 16.18 2011 -- 0.00 - 0.90 0.86 - 1.77 2010 -- 0.00 - 0.90 33.69 - 34.90 2009 0.35 0.45 - 0.90 37.72 - 38.97 MSF Van Eck Global Natural 2013 0.61 0.00 14.17 Resources Investment 2012 -- 0.00 2.80 Division 2011 -- 0.00 (22.34) (Commenced 5/2/2011) MSF Western Asset Management 2013 4.98 0.00 - 0.90 0.19 - 1.09 Strategic Bond Opportunities 2012 3.61 0.00 - 0.90 10.49 - 11.50 Investment Division 2011 5.05 0.00 - 0.90 5.19 - 6.14 2010 6.04 0.00 - 0.90 11.72 - 12.73 2009 6.60 0.90 31.04 - 32.22 MSF Western Asset Management 2013 2.13 0.00 - 0.90 (1.63) - (0.74) U.S. Government 2012 2.09 0.00 - 0.90 2.44 - 3.37 Investment Division 2011 1.49 0.00 - 0.90 4.56 - 5.51 2010 2.70 0.00 - 0.90 4.86 - 5.81 2009 4.49 0.90 3.40 - 4.33 PIMCO VIT All Asset 2013 9.56 0.00 0.27 Investment Division 2012 5.69 0.00 10.96 (Commenced 5/2/2011) 2011 3.04 0.00 (3.47) PIMCO VIT Commodity Real 2013 -- 0.00 (7.98) Return Strategy Investment Division (Commenced 4/29/2013) PIMCO VIT Low Duration 2013 1.45 0.00 0.21 Investment Division 2012 1.91 0.00 5.86 (Commenced 5/4/2009) 2011 1.68 0.00 1.11 2010 1.62 0.00 5.29 2009 1.55 0.00 10.57 Pioneer VCT Emerging 2013 0.56 0.00 (2.19) Markets Investment Division 2012 0.24 0.00 11.66 2011 -- 0.00 (23.62) 2010 0.33 0.00 15.61 2009 0.96 0.00 74.02
215 METROPOLITAN LIFE SEPARATE ACCOUNT UL OF METROPOLITAN LIFE INSURANCE COMPANY NOTES TO THE FINANCIAL STATEMENTS -- (CONCLUDED) 8. FINANCIAL HIGHLIGHTS -- (CONCLUDED)
AS OF DECEMBER 31 FOR THE YEAR ENDED DECEMBER 31 ---------------------------------------- ------------------------------------------------ UNIT VALUE INVESTMENT(1) EXPENSE RATIO(2) TOTAL RETURN(3) LOWEST TO NET INCOME LOWEST TO LOWEST TO UNITS HIGHEST ($) ASSETS ($) RATIO (%) HIGHEST (%) HIGHEST (%) ----------- -------------- ----------- ------------- ---------------- --------------- Pioneer VCT Mid Cap Value 2013 828 60.30 49,935 0.48 0.00 33.10 Investment Division 2012 3,389 45.30 153,545 1.05 0.00 11.11 (Commenced 4/28/2008 and 2011 3,306 40.77 134,780 0.87 0.00 (5.64) began transactions in 2009) 2010 2,302 43.21 99,478 1.08 0.00 18.22 2009 586 36.55 21,403 -- 0.00 25.58 Putnam VT International Value 2013 239 26.91 6,428 -- 0.00 22.21 Investment Division (Commenced 4/28/2008 and began transactions in 2013) Royce Micro-Cap 2013 374 20.76 7,757 0.01 0.00 20.99 Investment Division 2012 21,685 17.16 372,006 -- 0.00 7.60 (Commenced 11/10/2008 and 2011 19,473 15.94 310,463 2.46 0.00 (12.10) began transactions in 2010) 2010 19,226 18.14 348,709 3.02 0.00 29.96 Royce Small-Cap 2013 31,356 21.97 688,929 1.08 0.00 34.75 Investment Division 2012 33,234 16.30 541,872 0.09 0.00 12.50 (Commenced 11/10/2008 and 2011 52,075 14.49 754,742 0.36 0.00 (3.28) began transactions in 2009) 2010 26,235 14.99 393,142 0.14 0.00 20.52 2009 4,703 12.43 58,471 -- 0.00 35.20 UIF Emerging Markets Debt 2013 35,538 32.64 1,160,019 4.27 0.00 (8.75) Investment Division 2012 33,059 35.77 1,182,598 2.41 0.00 17.96 (Commenced 11/10/2008 and 2011 13,883 30.33 420,998 3.50 0.00 7.03 began transactions in 2009) 2010 259 28.33 7,343 4.24 0.00 9.74 2009 223 25.82 5,747 2.19 0.00 30.21 UIF Emerging Markets Equity 2013 83,866 14.74 1,236,458 1.23 0.00 (1.02) Investment Division 2012 69,412 14.90 1,033,944 -- 0.00 19.95 (Commenced 11/10/2008 and 2011 43,435 12.42 539,388 0.35 0.00 (18.22) began transactions in 2009) 2010 13,018 15.18 197,669 0.57 0.00 19.02 2009 442 12.76 5,643 -- 0.00 69.84 Wells Fargo VT Total Return 2013 16,006 16.11 257,839 1.23 0.00 (1.45) Bond Investment Division 2012 29,620 16.51 489,060 1.38 0.00 6.11 2011 8,689 15.56 135,214 2.74 0.00 8.33 2010 75,281 14.37 1,081,415 3.35 0.00 7.04 2009 39,845 13.42 534,737 4.42 0.00 12.00
1 These amounts represent the dividends, excluding distributions of capital gains, received by the Investment Division from the underlying fund, portfolio, or series, net of management fees assessed by the fund manager, divided by the average net assets, regardless of share class, if any. These ratios exclude those expenses, such as mortality and expense risk charges, that are assessed against policy owner accounts either through reductions in the unit values or the redemption of units. The investment income ratio is calculated for each period indicated or from the effective date through the end of the reporting period. The recognition of investment income by the Investment Division is affected by the timing of the declaration of dividends by the underlying fund, portfolio, or series, in which the Investment Division invests. The investment income ratio is calculated as a weighted average ratio since the Investment Division may invest in two or more share classes, if any, within the underlying fund, portfolio, or series of the Trusts which may have unique investment income ratios. 2 These amounts represent annualized policy expenses of each of the applicable Investment Divisions, consisting primarily of mortality and expense risk charges, for each period indicated. The ratios include only those expenses that result in a direct reduction to unit values. Charges made directly to policy owner accounts through the redemption of units and expenses of the underlying fund, portfolio, or series have been excluded. 3 These amounts represent the total return for the period indicated, including changes in the value of the underlying fund, portfolio, or series, and expenses assessed through the reduction of unit values. These ratios do not include any expenses assessed through the redemption of units. The total return is calculated for each period indicated or from the effective date through the end of the reporting period. The total return is presented as a range of minimum to maximum returns, based on the minimum and maximum returns within each product grouping of the applicable Investment Division. 216 Item 8. Financial Statements and Supplementary Data Index to Consolidated Financial Statements, Notes and Schedules
Page ---- Report of Independent Registered Public Accounting Firm............................................ 2 Financial Statements at December 31, 2013 and 2012 and for the Years Ended December 31, 2013, 2012 and 2011: Consolidated Balance Sheets....................................................................... 3 Consolidated Statements of Operations............................................................. 4 Consolidated Statements of Comprehensive Income (Loss)............................................ 5 Consolidated Statements of Equity................................................................. 6 Consolidated Statements of Cash Flows............................................................. 9 Notes to the Consolidated Financial Statements.................................................. 11 Note 1 -- Business, Basis of Presentation and Summary of Significant Accounting Policies...... 11 Note 2 -- Segment Information................................................................. 31 Note 3 -- Discontinued Operations............................................................. 37 Note 4 -- Insurance........................................................................... 37 Note 5 -- Deferred Policy Acquisition Costs, Value of Business Acquired and Other Policy- Related Intangibles......................................................................... 45 Note 6 -- Reinsurance......................................................................... 49 Note 7 -- Closed Block........................................................................ 55 Note 8 -- Investments......................................................................... 59 Note 9 -- Derivatives......................................................................... 85 Note 10 -- Fair Value......................................................................... 99 Note 11 -- Goodwill........................................................................... 129 Note 12 -- Long-term and Short-term Debt...................................................... 131 Note 13 -- Equity............................................................................. 134 Note 14 -- Other Expenses..................................................................... 144 Note 15 -- Employee Benefit Plans............................................................. 145 Note 16 -- Income Tax......................................................................... 157 Note 17 -- Contingencies, Commitments and Guarantees.......................................... 161 Note 18 -- Quarterly Results of Operations (Unaudited)........................................ 171 Note 19 -- Related Party Transactions......................................................... 171 Note 20 -- Subsequent Events.................................................................. 172 Financial Statement Schedules at December 31, 2013 and 2012 and for the Years Ended December 31, 2013, 2012 and 2011: Schedule I -- Consolidated Summary of Investments -- Other Than Investments in Related Parties.... 173 Schedule III -- Consolidated Supplementary Insurance Information.................................. 174 Schedule IV -- Consolidated Reinsurance........................................................... 176
1 REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Board of Directors and Stockholder of Metropolitan Life Insurance Company: We have audited the accompanying consolidated balance sheets of Metropolitan Life Insurance Company and subsidiaries (the "Company") as of December 31, 2013 and 2012, and the related consolidated statements of operations, comprehensive income (loss), equity, and cash flows for each of the three years in the period ended December 31, 2013. Our audits also included the financial statement schedules listed in the Index to Consolidated Financial Statements, Notes and Schedules. These consolidated financial statements and financial statement schedules are the responsibility of the Company's management. Our responsibility is to express an opinion on the consolidated financial statements and financial statement schedules based on our audits. We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the consolidated financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, such consolidated financial statements present fairly, in all material respects, the financial position of Metropolitan Life Insurance Company and subsidiaries as of December 31, 2013 and 2012, and the results of their operations and their cash flows for each of the three years in the period ended December 31, 2013, in conformity with accounting principles generally accepted in the United States of America. Also, in our opinion, such financial statement schedules, when considered in relation to the basic consolidated financial statements taken as a whole, present fairly, in all material respects, the information set forth therein. /s/ DELOITTE & TOUCHE LLP New York, New York March 27, 2014 2 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Consolidated Balance Sheets December 31, 2013 and 2012 (In millions, except share and per share data)
2013 2012 ------------ ------------ Assets Investments: Fixed maturity securities available-for-sale, at estimated fair value (amortized cost: $165,371 and $164,757, respectively; includes $157 and $170, respectively, relating to variable interest entities).................. $ 173,746 $ 183,676 Equity securities available-for-sale, at estimated fair value (cost: $1,813 and $1,541, respectively).................................................... 1,892 1,499 Trading and fair value option securities, at estimated fair value (includes $662 and $659, respectively, of actively traded securities; and $23 and $41, respectively, relating to variable interest entities)........................ 723 752 Mortgage loans (net of valuation allowances of $272 and $304, respectively; includes $338 and $0, respectively, under the fair value option)............. 46,024 44,657 Policy loans................................................................... 8,421 8,364 Real estate and real estate joint ventures (includes $1,141 and $10, respectively, relating to variable interest entities; includes $40 and $1, respectively, of real estate held-for-sale).................................. 7,798 6,837 Other limited partnership interests (includes $53 and $165, respectively, relating to variable interest entities)...................................... 4,716 4,508 Short-term investments, principally at estimated fair value.................... 5,962 6,881 Other invested assets, principally at estimated fair value (includes $78 and $81, respectively, relating to variable interest entities)................... 10,589 12,479 ------------ ------------ Total investments............................................................ 259,871 269,653 Cash and cash equivalents, principally at estimated fair value (includes $21 and $31, respectively, relating to variable interest entities)................. 1,098 1,401 Accrued investment income (includes $2 and $2, respectively, relating to variable interest entities).................................................... 2,249 2,242 Premiums, reinsurance and other receivables (includes $7 and $4, respectively, relating to variable interest entities)........................................ 23,637 24,721 Deferred policy acquisition costs and value of business acquired................ 6,416 5,832 Other assets (includes $24 and $4, respectively, relating to variable interest entities)...................................................................... 4,716 4,444 Separate account assets......................................................... 134,796 120,971 ------------ ------------ Total assets................................................................. $ 432,783 $ 429,264 ============ ============ Liabilities and Equity Liabilities Future policy benefits.......................................................... $ 111,963 $ 113,986 Policyholder account balances................................................... 92,498 94,716 Other policy-related balances................................................... 5,671 5,663 Policyholder dividends payable.................................................. 601 610 Policyholder dividend obligation................................................ 1,771 3,828 Payables for collateral under securities loaned and other transactions.......... 21,096 22,461 Short-term debt................................................................. 175 100 Long-term debt (includes $520 and $124, respectively, at estimated fair value, relating to variable interest entities)........................................ 2,828 2,345 Current income tax payable...................................................... 365 161 Deferred income tax liability (includes $1 and $2, respectively, at estimated fair value, relating to variable interest entities)............................ 1,785 3,036 Other liabilities (includes $31 and $22, respectively, relating to variable interest entities)............................................................. 32,180 33,941 Separate account liabilities.................................................... 134,796 120,971 ------------ ------------ Total liabilities............................................................ 405,729 401,818 ------------ ------------ Contingencies, Commitments and Guarantees (Note 17) Redeemable noncontrolling interests............................................. 774 -- ------------ ------------ Equity Metropolitan Life Insurance Company stockholder's equity: Common stock, par value $0.01 per share; 1,000,000,000 shares authorized; 494,466,664 shares issued and outstanding at December 31, 2013 and 2012...... 5 5 Additional paid-in capital..................................................... 14,515 14,510 Retained earnings.............................................................. 9,352 8,631 Accumulated other comprehensive income (loss).................................. 2,158 4,008 ------------ ------------ Total Metropolitan Life Insurance Company stockholder's equity............... 26,030 27,154 Noncontrolling interests........................................................ 250 292 ------------ ------------ Total equity................................................................. 26,280 27,446 ------------ ------------ Total liabilities and equity................................................. $ 432,783 $ 429,264 ============ ============
See accompanying notes to the consolidated financial statements. 3 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Consolidated Statements of Operations For the Years Ended December 31, 2013, 2012 and 2011 (In millions)
2013 2012 2011 ---------- ---------- ---------- Revenues Premiums......................................................... $ 20,475 $ 19,880 $ 18,288 Universal life and investment-type product policy fees........... 2,363 2,239 2,202 Net investment income............................................ 11,785 11,852 11,615 Other revenues................................................... 1,699 1,730 1,808 Net investment gains (losses): Other-than-temporary impairments on fixed maturity securities.................................................... (81) (214) (244) Other-than-temporary impairments on fixed maturity securities transferred to other comprehensive income (loss).............. (47) 22 17 Other net investment gains (losses)............................. 176 (138) 359 ---------- ---------- ---------- Total net investment gains (losses)........................... 48 (330) 132 Net derivative gains (losses)................................... (1,070) 675 1,578 ---------- ---------- ---------- Total revenues.............................................. 35,300 36,046 35,623 ---------- ---------- ---------- Expenses Policyholder benefits and claims................................. 23,032 22,269 20,681 Interest credited to policyholder account balances............... 2,253 2,390 2,372 Policyholder dividends........................................... 1,205 1,295 1,355 Other expenses................................................... 5,988 6,394 6,471 ---------- ---------- ---------- Total expenses.............................................. 32,478 32,348 30,879 ---------- ---------- ---------- Income (loss) from continuing operations before provision for income tax..................................................... 2,822 3,698 4,744 Provision for income tax expense (benefit)....................... 681 1,055 1,460 ---------- ---------- ---------- Income (loss) from continuing operations, net of income tax...... 2,141 2,643 3,284 Income (loss) from discontinued operations, net of income tax.... 1 40 61 ---------- ---------- ---------- Net income (loss)................................................ 2,142 2,683 3,345 Less: Net income (loss) attributable to noncontrolling interests. (7) 2 (8) ---------- ---------- ---------- Net income (loss) attributable to Metropolitan Life Insurance Company........................................................ $ 2,149 $ 2,681 $ 3,353 ========== ========== ==========
See accompanying notes to the consolidated financial statements. 4 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Consolidated Statements of Comprehensive Income (Loss) For the Years Ended December 31, 2013, 2012 and 2011 (In millions)
2013 2012 2011 -------- ---------- ---------- Net income (loss) attributable to Metropolitan Life Insurance Company............................................................ $ 2,149 $ 2,681 $ 3,353 Net income (loss) attributable to noncontrolling interests........... (7) 2 (8) -------- ---------- ---------- Net income (loss).................................................... 2,142 2,683 3,345 Other comprehensive income (loss): Unrealized investment gains (losses), net of related offsets........ (3,337) 2,502 2,567 Unrealized gains (losses) on derivatives............................ (691) (241) 1,203 Foreign currency translation adjustments............................ 22 (30) 6 Defined benefit plans adjustment.................................... 1,191 (766) (671) -------- ---------- ---------- Other comprehensive income (loss), before income tax................. (2,815) 1,465 3,105 Income tax (expense) benefit related to items of other comprehensive income (loss)...................................................... 965 (511) (1,074) -------- ---------- ---------- Other comprehensive income (loss), net of income tax................. (1,850) 954 2,031 -------- ---------- ---------- Comprehensive income (loss).......................................... 292 3,637 5,376 Less: Comprehensive income (loss) attributable to noncontrolling interest, net of income tax........................................ (7) 2 (8) -------- ---------- ---------- Comprehensive income (loss) attributable to Metropolitan Life Insurance Company.................................................. $ 299 $ 3,635 $ 5,384 ======== ========== ==========
See accompanying notes to the consolidated financial statements. 5 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Consolidated Statements of Equity For the Year Ended December 31, 2013 (In millions)
Accumulated Other Comprehensive Income (Loss) ------------------------------------------------------ Net Foreign Defined Additional Unrealized Other-Than- Currency Benefit Common Paid-in Retained Investment Temporary Translation Plans Stock Capital Earnings Gains (Losses) Impairments Adjustments Adjustment -------- ------------- ------------ --------------- ------------ ------------ ------------ Balance at December 31, 2012... $ 5 $ 14,510 $ 8,631 $ 6,497 $ (158) $ 18 $ (2,349) Capital contributions from MetLife, Inc. (Note 13)....... 3 Excess tax benefits related to stock-based compensation...... 2 Dividends on common stock...... (1,428) Change in equity of noncontrolling interests...... Net income (loss).............. 2,149 Other comprehensive income (loss), net of income tax..... (2,700) 65 13 772 -------- ------------- ------------ ------------ --------- --------- ------------ Balance at December 31, 2013... $ 5 $ 14,515 $ 9,352 $ 3,797 $ (93) $ 31 $ (1,577) ======== ============= ============ ============ ========= ========= ============
Total Metropolitan Life Insurance Company Noncontrolling Total Stockholder's Equity Interests Equity --------------------- --------------- ------------- Balance at December 31, 2012... $ 27,154 $ 292 $ 27,446 Capital contributions from MetLife, Inc. (Note 13)....... 3 3 Excess tax benefits related to stock-based compensation...... 2 2 Dividends on common stock...... (1,428) (1,428) Change in equity of noncontrolling interests...... (35) (35) Net income (loss).............. 2,149 (7) 2,142 Other comprehensive income (loss), net of income tax..... (1,850) (1,850) ------------- ---------- ------------- Balance at December 31, 2013... $ 26,030 $ 250 $ 26,280 ============= ========== =============
See accompanying notes to the consolidated financial statements. 6 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Consolidated Statements of Equity -- (Continued) For the Year Ended December 31, 2012 (In millions)
Accumulated Other Comprehensive Income (Loss) ----------------------------------------------------- Net Foreign Defined Additional Unrealized Other-Than- Currency Benefit Common Paid-in Retained Investment Temporary Translation Plans Stock Capital Earnings Gains (Losses) Impairments Adjustments Adjustment ------- ----------- --------- --------------- ------------ ------------ ----------- Balance at December 31, 2011............... $ 5 $ 14,506 $ 6,973 $ 5,185 $ (317) $ 37 $ (1,851) Capital contributions from MetLife, Inc. (Note 13)................................. 3 Excess tax benefits related to stock-based compensation.............................. 1 Dividends on common stock.................. (1,023) Change in equity of noncontrolling interests................................. Net income (loss).......................... 2,681 Other comprehensive income (loss), net of income tax................................ 1,312 159 (19) (498) ---- --------- -------- -------- -------- ----- ---------- Balance at December 31, 2012............... $ 5 $ 14,510 $ 8,631 $ 6,497 $ (158) $ 18 $ (2,349) ==== ========= ======== ======== ======== ===== ==========
Total Metropolitan Life Insurance Company Noncontrolling Total Stockholder's Equity Interests Equity --------------------- --------------- --------- Balance at December 31, 2011............... $ 24,538 $ 182 $ 24,720 Capital contributions from MetLife, Inc. (Note 13)................................. 3 3 Excess tax benefits related to stock-based compensation.............................. 1 1 Dividends on common stock.................. (1,023) (1,023) Change in equity of noncontrolling interests................................. 108 108 Net income (loss).......................... 2,681 2 2,683 Other comprehensive income (loss), net of income tax................................ 954 954 --------- ------ --------- Balance at December 31, 2012............... $ 27,154 $ 292 $ 27,446 ========= ====== =========
See accompanying notes to the consolidated financial statements. 7 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Consolidated Statements of Equity -- (Continued) For the Year Ended December 31, 2011 (In millions)
Accumulated Other Comprehensive Income (Loss) ----------------------------------------------------- Net Foreign Defined Additional Unrealized Other-Than- Currency Benefit Common Paid-in Retained Investment Temporary Translation Plans Stock Capital Earnings Gains (Losses) Impairments Adjustments Adjustment ------- ----------- --------- --------------- ------------ ------------ ----------- Balance at December 31, 2010............... $ 5 $ 14,445 $ 4,941 $ 2,672 $ (254) $ 34 $ (1,429) Capital contributions from MetLife, Inc. (Note 13)................................. 50 Excess tax benefits related to stock-based compensation.............................. 11 Dividends on common stock.................. (1,321) Change in equity of noncontrolling interests................................. Net income (loss).......................... 3,353 Other comprehensive income (loss), net of income tax................................ 2,513 (63) 3 (422) ---- --------- -------- -------- -------- ----- ---------- Balance at December 31, 2011............... $ 5 $ 14,506 $ 6,973 $ 5,185 $ (317) $ 37 $ (1,851) ==== ========= ======== ======== ======== ===== ==========
Total Metropolitan Life Insurance Non Company controlling Total Stockholder's Equity Interests Equity --------------------- ------------ --------- Balance at December 31, 2010............... $ 20,414 $ 148 $ 20,562 Capital contributions from MetLife, Inc. (Note 13)................................. 50 50 Excess tax benefits related to stock-based compensation.............................. 11 11 Dividends on common stock.................. (1,321) (1,321) Change in equity of noncontrolling interests................................. 42 42 Net income (loss).......................... 3,353 (8) 3,345 Other comprehensive income (loss), net of income tax................................ 2,031 2,031 --------- ------ --------- Balance at December 31, 2011............... $ 24,538 $ 182 $ 24,720 ========= ====== =========
See accompanying notes to the consolidated financial statements. 8 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Consolidated Statements of Cash Flows For the Years Ended December 31, 2013, 2012 and 2011 (In millions)
2013 2012 2011 ---------- ----------- ---------- Cash flows from operating activities Net income (loss)............................................................... $ 2,142 $ 2,683 $ 3,345 Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: Depreciation and amortization expenses......................................... 429 416 407 Amortization of premiums and accretion of discounts associated with investments, net............................................................. (738) (698) (683) (Gains) losses on investments and derivatives and from sales of businesses, net 1,112 (188) (1,735) (Income) loss from equity method investments, net of dividends or distributions 195 42 269 Interest credited to policyholder account balances............................. 2,253 2,390 2,372 Universal life and investment-type product policy fees......................... (2,363) (2,239) (2,202) Change in trading and fair value option securities............................. 25 (100) 20 Change in accrued investment income............................................ 108 22 14 Change in premiums, reinsurance and other receivables.......................... (368) (422) (208) Change in deferred policy acquisition costs and value of business acquired, net (82) 359 150 Change in income tax........................................................... 334 (28) 527 Change in other assets......................................................... 471 361 767 Change in insurance-related liabilities and policy-related balances............ 3,032 1,915 2,587 Change in other liabilities.................................................... (381) 170 726 Other, net..................................................................... (109) (147) (125) ---------- ----------- ---------- Net cash provided by (used in) operating activities............................. 6,060 4,536 6,231 ---------- ----------- ---------- Cash flows from investing activities Sales, maturities and repayments of: Fixed maturity securities...................................................... 71,396 52,889 53,325 Equity securities.............................................................. 206 245 816 Mortgage loans................................................................. 10,655 8,668 8,152 Real estate and real estate joint ventures..................................... 87 721 1,058 Other limited partnership interests............................................ 449 585 754 Purchases of: Fixed maturity securities...................................................... (70,760) (62,136) (54,038) Equity securities.............................................................. (461) (393) (278) Mortgage loans................................................................. (12,032) (9,448) (10,443) Real estate and real estate joint ventures..................................... (1,427) (1,447) (980) Other limited partnership interests............................................ (675) (660) (658) Cash received in connection with freestanding derivatives....................... 560 634 1,011 Cash paid in connection with freestanding derivatives........................... (1,171) (443) (695) Issuances of loans to affiliates................................................ -- -- (525) Net change in policy loans...................................................... (57) (50) (44) Net change in short-term investments............................................ 900 (567) (3,816) Net change in other invested assets............................................. (460) (791) (562) Net change in property, equipment and leasehold improvements.................... (76) (71) (104) Other, net...................................................................... -- -- 7 ---------- ----------- ---------- Net cash provided by (used in) investing activities............................. $ (2,866) $ (12,264) $ (7,020) ---------- ----------- ----------
See accompanying notes to the consolidated financial statements. 9 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Consolidated Statements of Cash Flows -- (Continued) For the Years Ended December 31, 2013, 2012 and 2011 (In millions)
2013 2012 2011 ----------- ----------- ----------- Cash flows from financing activities Policyholder account balances: Deposits........................................................................... $ 50,018 $ 61,647 $ 55,586 Withdrawals........................................................................ (52,020) (56,373) (57,078) Net change in payables for collateral under securities loaned and other transactions. (1,365) 2,181 3,266 Net change in short-term debt........................................................ 75 (1) (1) Long-term debt issued................................................................ 481 79 110 Long-term debt repaid................................................................ (27) (81) (1,411) Cash received in connection with redeemable noncontrolling interests................. 774 -- -- Dividends on common stock............................................................ (1,428) (1,023) (1,151) Capital contribution................................................................. -- -- 47 Other, net........................................................................... (5) 611 25 ----------- ----------- ----------- Net cash provided by (used in) financing activities.................................. (3,497) 7,040 (607) ----------- ----------- ----------- Change in cash and cash equivalents.................................................. (303) (688) (1,396) Cash and cash equivalents, beginning of year......................................... 1,401 2,089 3,485 ----------- ----------- ----------- Cash and cash equivalents, end of year............................................... $ 1,098 $ 1,401 $ 2,089 =========== =========== =========== Supplemental disclosures of cash flow information: Net cash paid (received) for: Interest........................................................................... $ 152 $ 151 $ 196 =========== =========== =========== Income tax......................................................................... $ 822 $ 842 $ 701 =========== =========== =========== Non-cash transactions: Capital contributions from MetLife, Inc............................................ $ 3 $ 3 $ 3 =========== =========== =========== Dividends to MetLife, Inc.......................................................... $ -- $ -- $ 170 =========== =========== =========== Real estate and real estate joint ventures acquired in satisfaction of debt........ $ 18 $ 264 $ 151 =========== =========== ===========
See accompanying notes to the consolidated financial statements. 10 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements 1. Business, Basis of Presentation and Summary of Significant Accounting Policies Business Metropolitan Life Insurance Company and its subsidiaries (collectively, "MLIC" or the "Company") is a leading provider of insurance, annuities and employee benefit programs throughout the United States. The Company offers life insurance and annuities to individuals, as well as group insurance and retirement & savings products and services to corporations and other institutions. Metropolitan Life Insurance Company is a wholly-owned subsidiary of MetLife, Inc. The Company is organized into three segments: Retail; Group, Voluntary & Worksite Benefits; and Corporate Benefit Funding. Basis of Presentation The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America ("GAAP") requires management to adopt accounting policies and make estimates and assumptions that affect amounts reported in the consolidated financial statements. In applying these policies and estimates, management makes subjective and complex judgments that frequently require assumptions about matters that are inherently uncertain. Many of these policies, estimates and related judgments are common in the insurance and financial services industries; others are specific to the Company's business and operations. Actual results could differ from estimates. Consolidation The accompanying consolidated financial statements include the accounts of Metropolitan Life Insurance Company and its subsidiaries, as well as partnerships and joint ventures in which the Company has control, and variable interest entities ("VIEs") for which the Company is the primary beneficiary. Intercompany accounts and transactions have been eliminated. Since the Company is a member of a controlled group of affiliated companies, its results may not be indicative of those of a stand-alone entity. Discontinued Operations The results of operations of a component of the Company that has either been disposed of or is classified as held-for-sale are reported in discontinued operations if certain criteria are met. In order to qualify for a discontinued operation, the operations and cash flows of the component have been or will be eliminated from the ongoing operations of the Company, and the Company will not have any significant continuing involvement in the operations of the component after the disposal transaction. Separate Accounts Separate accounts are established in conformity with insurance laws and are generally not chargeable with liabilities that arise from any other business of the Company. Separate account assets are subject to general account claims only to the extent the value of such assets exceeds the separate account liabilities. The Company reports separately, as assets and liabilities, investments held in separate accounts and liabilities of the separate accounts if: . such separate accounts are legally recognized; 11 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 1. Business, Basis of Presentation and Summary of Significant Accounting Policies (continued) . assets supporting the contract liabilities are legally insulated from the Company's general account liabilities; . investments are directed by the contractholder; and . all investment performance, net of contract fees and assessments, is passed through to the contractholder. The Company reports separate account assets at their fair value, which is based on the estimated fair values of the underlying assets comprising the individual separate account portfolios. Investment performance (including investment income, net investment gains (losses) and changes in unrealized gains (losses)) and the corresponding amounts credited to contractholders of such separate accounts are offset within the same line in the statements of operations. Separate accounts credited with a contractual investment return are combined on a line-by-line basis with the Company's general account assets, liabilities, revenues and expenses and the accounting for these investments is consistent with the methodologies described herein for similar financial instruments held within the general account. The Company's revenues reflect fees charged to the separate accounts, including mortality charges, risk charges, policy administration fees, investment management fees and surrender charges. Such fees are included in universal life and investment-type product policy fees in the statements of operations. Reclassifications Certain amounts in the prior years' consolidated financial statements and related footnotes thereto have been reclassified to conform with the current year presentation as discussed throughout the Notes to the Consolidated Financial Statements. Summary of Significant Accounting Policies The following are the Company's significant accounting policies with references to notes providing additional information on such policies and critical accounting estimates relating to such policies. -------------------------------------------------------------------------------------------------------- Accounting Policy Note -------------------------------------------------------------------------------------------------------- Insurance 4 -------------------------------------------------------------------------------------------------------- Deferred Policy Acquisition Costs, Value of Business Acquired and Other Policy-Related Intangibles 5 -------------------------------------------------------------------------------------------------------- Reinsurance 6 -------------------------------------------------------------------------------------------------------- Investments 8 -------------------------------------------------------------------------------------------------------- Derivatives 9 -------------------------------------------------------------------------------------------------------- Fair Value 10 -------------------------------------------------------------------------------------------------------- Goodwill 11 -------------------------------------------------------------------------------------------------------- Employee Benefit Plans 15 -------------------------------------------------------------------------------------------------------- Income Tax 16 -------------------------------------------------------------------------------------------------------- Litigation Contingencies 17 --------------------------------------------------------------------------------------------------------
12 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 1. Business, Basis of Presentation and Summary of Significant Accounting Policies (continued) Insurance Future Policy Benefit Liabilities and Policyholder Account Balances The Company establishes liabilities for amounts payable under insurance policies. Generally, amounts are payable over an extended period of time and related liabilities are calculated as the present value of future expected benefits to be paid reduced by the present value of future expected premiums. Such liabilities are established based on methods and underlying assumptions in accordance with GAAP and applicable actuarial standards. Principal assumptions used in the establishment of liabilities for future policy benefits are mortality, morbidity, policy lapse, renewal, retirement, disability incidence, disability terminations, investment returns, inflation, expenses and other contingent events as appropriate to the respective product type. These assumptions are established at the time the policy is issued and are intended to estimate the experience for the period the policy benefits are payable. Utilizing these assumptions, liabilities are established on a block of business basis. For long duration insurance contracts, assumptions such as mortality, morbidity and interest rates are "locked in" upon the issuance of new business. However, significant adverse changes in experience on such contracts may require the establishment of premium deficiency reserves. Such reserves are determined based on the then current assumptions and do not include a provision for adverse deviation. Premium deficiency reserves may also be established for short duration contracts to provide for expected future losses. These reserves are based on actuarial estimates of the amount of loss inherent in that period, including losses incurred for which claims have not been reported. The provisions for unreported claims are calculated using studies that measure the historical length of time between the incurred date of a claim and its eventual reporting to the Company. Anticipated investment income is considered in the calculation of premium deficiency losses for short duration contracts. Liabilities for universal and variable life secondary guarantees and paid-up guarantees are determined by estimating the expected value of death benefits payable when the account balance is projected to be zero and recognizing those benefits ratably over the accumulation period based on total expected assessments. The assumptions used in estimating the secondary and paid-up guarantee liabilities are consistent with those used for amortizing deferred policy acquisition costs ("DAC"), and are thus subject to the same variability and risk as further discussed herein. The assumptions of investment performance and volatility for variable products are consistent with historical experience of appropriate underlying equity indices, such as the Standard & Poor's Ratings Services ("S&P") 500 Index. The benefits used in calculating the liabilities are based on the average benefits payable over a range of scenarios. The Company regularly reviews its estimates of liabilities for future policy benefits and compares them with its actual experience. Differences result in changes to the liability balances with related charges or credits to benefit expenses in the period in which the changes occur. Policyholder account balances ("PABs") relate to contract or contract features where the Company has no significant insurance risk. The Company issues certain variable annuity products with guaranteed minimum benefits that provide the policyholder a minimum return based on their initial deposit (i.e., the benefit base) less withdrawals. These guarantees are accounted for as insurance liabilities or as embedded derivatives depending on how and when 13 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 1. Business, Basis of Presentation and Summary of Significant Accounting Policies (continued) the benefit is paid. Specifically, a guarantee is accounted for as an embedded derivative if a guarantee is paid without requiring (i) the occurrence of specific insurable event, or (ii) the policyholder to annuitize. Alternatively, a guarantee is accounted for as an insurance liability if the guarantee is paid only upon either (i) the occurrence of a specific insurable event, or (ii) annuitization. In certain cases, a guarantee may have elements of both an insurance liability and an embedded derivative and in such cases the guarantee is split and accounted for under both models. Guarantees accounted for as insurance liabilities in future policy benefits include guaranteed minimum death benefits ("GMDBs"), the portion of guaranteed minimum income benefits ("GMIBs") that require annuitization, and the life-contingent portion of guaranteed minimum withdrawal benefits ("GMWBs"). Guarantees accounted for as embedded derivatives in PABs include the non life-contingent portion of GMWBs, guaranteed minimum accumulation benefits ("GMABs") and the portion of GMIBs that do not require annuitization. At inception, the Company attributes to the embedded derivative a portion of the projected future guarantee fees to be collected from the policyholder equal to the present value of projected future guaranteed benefits. Any additional fees represent "excess" fees and are reported in universal life and investment-type product policy fees. Other Policy-Related Balances Other policy-related balances include policy and contract claims, unearned revenue liabilities, premiums received in advance, policyholder dividends due and unpaid and policyholder dividends left on deposit. The liability for policy and contract claims generally relates to incurred but not reported death, disability, long-term care ("LTC") and dental claims, as well as claims which have been reported but not yet settled. The liability for these claims is based on the Company's estimated ultimate cost of settling all claims. The Company derives estimates for the development of incurred but not reported claims principally from analyses of historical patterns of claims by business line. The methods used to determine these estimates are continually reviewed. Adjustments resulting from this continuous review process and differences between estimates and payments for claims are recognized in policyholder benefits and claims expense in the period in which the estimates are changed or payments are made. The unearned revenue liability relates to universal life-type and investment-type products and represents policy charges for services to be provided in future periods. The charges are deferred as unearned revenue and amortized using the product's estimated gross profits and margins, similar to DAC as discussed further herein. Such amortization is recorded in universal life and investment-type product policy fees. The Company accounts for the prepayment of premiums on its individual life, group life and health contracts as premium received in advance and applies the cash received to premiums when due. Recognition of Insurance Revenues and Deposits Premiums related to traditional life and annuity policies with life contingencies are recognized as revenues when due from policyholders. Policyholder benefits and expenses are provided to recognize profits over the estimated lives of the insurance policies. When premiums are due over a significantly shorter period than the 14 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 1. Business, Basis of Presentation and Summary of Significant Accounting Policies (continued) period over which benefits are provided, any excess profit is deferred and recognized into earnings in a constant relationship to insurance in-force or, for annuities, the amount of expected future policy benefit payments. Premiums related to non-medical health and disability contracts are recognized on a pro rata basis over the applicable contract term. Deposits related to universal life-type and investment-type products are credited to PABs. Revenues from such contracts consist of fees for mortality, policy administration and surrender charges and are recorded in universal life and investment-type product policy fees in the period in which services are provided. Amounts that are charged to earnings include interest credited and benefit claims incurred in excess of related PABs. Premiums, policy fees, policyholder benefits and expenses are presented net of reinsurance. Deferred Policy Acquisition Costs, Value of Business Acquired and Other Policy-Related Intangibles The Company incurs significant costs in connection with acquiring new and renewal insurance business. Costs that are related directly to the successful acquisition or renewal of insurance contracts are capitalized as DAC. Such costs include: . incremental direct costs of contract acquisition, such as commissions; . the portion of an employee's total compensation and benefits related to time spent selling, underwriting or processing the issuance of new and renewal insurance business only with respect to actual policies acquired or renewed; and . other essential direct costs that would not have been incurred had a policy not been acquired or renewed. All other acquisition-related costs, including those related to general advertising and solicitation, market research, agent training, product development, unsuccessful sales and underwriting efforts, as well as all indirect costs, are expensed as incurred. Value of business acquired ("VOBA") is an intangible asset resulting from a business combination that represents the excess of book value over the estimated fair value of acquired insurance, annuity, and investment-type contracts in-force at the acquisition date. The estimated fair value of the acquired liabilities is based on projections, by each block of business, of future policy and contract charges, premiums, mortality and morbidity, separate account performance, surrenders, operating expenses, investment returns, nonperformance risk adjustment and other factors. Actual experience on the purchased business may vary from these projections. 15 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 1. Business, Basis of Presentation and Summary of Significant Accounting Policies (continued) DAC and VOBA are amortized as follows: ----------------------------------------------------------------------------- Products: In proportion to the following over estimated lives of the contracts: ----------------------------------------------------------------------------- . Nonparticipating and Historic actual and expected future non-dividend-paying traditional gross premiums. contracts: . Term insurance . Nonparticipating whole life insurance . Traditional group life insurance . Non-medical health insurance ----------------------------------------------------------------------------- . Participating, dividend-paying Actual and expected future gross traditional contracts margins. ----------------------------------------------------------------------------- . Fixed and variable universal life Actual and expected future gross contracts profits. . Fixed and variable deferred annuity contracts ----------------------------------------------------------------------------- See Note 5 for additional information on DAC and VOBA amortization. The recovery of DAC and VOBA is dependent upon the future profitability of the related business. DAC and VOBA are aggregated in the financial statements for reporting purposes. The Company generally has two different types of sales inducements which are included in other assets: (i) the policyholder receives a bonus whereby the policyholder's initial account balance is increased by an amount equal to a specified percentage of the customer's deposit; and (ii) the policyholder receives a higher interest rate using a dollar cost averaging method than would have been received based on the normal general account interest rate credited. The Company defers sales inducements and amortizes them over the life of the policy using the same methodology and assumptions used to amortize DAC. The amortization of sales inducements is included in policyholder benefits and claims. Each year, or more frequently if circumstances indicate a potential recoverability issue exists, the Company reviews deferred sales inducements to determine the recoverability of the asset. Value of distribution agreements acquired ("VODA") is reported in other assets and represents the present value of expected future profits associated with the expected future business derived from the distribution agreements acquired as part of a business combination. Value of customer relationships acquired ("VOCRA") is also reported in other assets and represents the present value of the expected future profits associated with the expected future business acquired through existing customers of the acquired company or business. The VODA and VOCRA associated with past business combinations are amortized over useful lives ranging from 10 to 30 years and such amortization is included in other expenses. Each year, or more frequently if circumstances indicate a possible impairment exists, the Company reviews VODA and VOCRA to determine whether the asset is impaired. Reinsurance For each of its reinsurance agreements, the Company determines whether the agreement provides indemnification against loss or liability relating to insurance risk in accordance with applicable accounting standards. Cessions under reinsurance agreements do not discharge the Company's obligations as the primary 16 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 1. Business, Basis of Presentation and Summary of Significant Accounting Policies (continued) insurer. The Company reviews all contractual features, including those that may limit the amount of insurance risk to which the reinsurer is subject or features that delay the timely reimbursement of claims. For reinsurance of existing in-force blocks of long-duration contracts that transfer significant insurance risk, the difference, if any, between the amounts paid (received), and the liabilities ceded (assumed) related to the underlying contracts is considered the net cost of reinsurance at the inception of the reinsurance agreement. The net cost of reinsurance is recorded as an adjustment to DAC when there is a gain at inception on the ceding entity and to other liabilities when there is a loss at inception. The net cost of reinsurance is recognized as a component of other expenses when there is a gain at inception and as policyholder benefits and claims when there is a loss and is subsequently amortized on a basis consistent with the methodology used for amortizing DAC related to the underlying reinsured contracts. Subsequent amounts paid (received) on the reinsurance of in-force blocks, as well as amounts paid (received) related to new business, are recorded as ceded (assumed) premiums; and ceded (assumed) premiums reinsurance and other receivables (future policy benefits) are established. For prospective reinsurance of short-duration contracts that meet the criteria for reinsurance accounting, amounts paid (received) are recorded as ceded (assumed) premiums and ceded (assumed) unearned premiums. Unearned premiums are reflected as a component of premiums, reinsurance and other receivables (future policy benefits). Such amounts are amortized through earned premiums over the remaining contract period in proportion to the amount of insurance protection provided. For retroactive reinsurance of short-duration contracts that meet the criteria of reinsurance accounting, amounts paid (received) in excess of the related insurance liabilities ceded (assumed) are recognized immediately as a loss and are reported in the appropriate line item within the statement of operations. Any gain on such retroactive agreement is deferred and is amortized as part of DAC, primarily using the recovery method. Amounts currently recoverable under reinsurance agreements are included in premiums, reinsurance and other receivables and amounts currently payable are included in other liabilities. Assets and liabilities relating to reinsurance agreements with the same reinsurer may be recorded net on the balance sheet, if a right of offset exists within the reinsurance agreement. In the event that reinsurers do not meet their obligations to the Company under the terms of the reinsurance agreements, reinsurance recoverable balances could become uncollectible. In such instances, reinsurance recoverable balances are stated net of allowances for uncollectible reinsurance. The funds withheld liability represents amounts withheld by the Company in accordance with the terms of the reinsurance agreements. The Company withholds the funds rather than transferring the underlying investments and, as a result, records funds withheld liability within other liabilities. The Company recognizes interest on funds withheld, included in other expenses, at rates defined by the terms of the agreement which may be contractually specified or directly related to the investment portfolio. Premiums, fees and policyholder benefits and claims include amounts assumed under reinsurance agreements and are net of reinsurance ceded. Amounts received from reinsurers for policy administration are reported in other revenues. With respect to GMIBs, a portion of the directly written GMIBs are accounted for as insurance liabilities, but the associated reinsurance agreements contain embedded derivatives. These embedded derivatives are included in premiums, reinsurance and other receivables with changes in estimated fair value reported in net derivative gains (losses). 17 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 1. Business, Basis of Presentation and Summary of Significant Accounting Policies (continued) If the Company determines that a reinsurance agreement does not expose the reinsurer to a reasonable possibility of a significant loss from insurance risk, the Company records the agreement using the deposit method of accounting. Deposits received are included in other liabilities and deposits made are included within premiums, reinsurance and other receivables. As amounts are paid or received, consistent with the underlying contracts, the deposit assets or liabilities are adjusted. Interest on such deposits is recorded as other revenues or other expenses, as appropriate. Periodically, the Company evaluates the adequacy of the expected payments or recoveries and adjusts the deposit asset or liability through other revenues or other expenses, as appropriate. Investments Net Investment Income and Net Investment Gains (Losses) Income on investments is reported within net investment income, unless otherwise stated herein. Gains and losses on sales of investments, impairment losses and changes in valuation allowances are reported within net investment gains (losses), unless otherwise stated herein. Fixed Maturity and Equity Securities The majority of the Company's fixed maturity and equity securities are classified as available-for-sale ("AFS") and are reported at their estimated fair value. Unrealized investment gains and losses on these securities are recorded as a separate component of other comprehensive income (loss) ("OCI"), net of policyholder-related amounts and deferred income taxes. All security transactions are recorded on a trade date basis. Investment gains and losses on sales are determined on a specific identification basis. Interest income on fixed maturity securities is recognized when earned using an effective yield method giving effect to amortization of premiums and accretion of discounts. Prepayment fees are recognized when earned. Dividends on equity securities are recognized when declared. The Company periodically evaluates fixed maturity and equity securities for impairment. The assessment of whether impairments have occurred is based on management's case-by-case evaluation of the underlying reasons for the decline in estimated fair value, as well as an analysis of the gross unrealized losses by severity and/or age as described in Note 8 "-- Evaluation of AFS Securities for OTTI and Evaluating Temporarily Impaired AFS Securities." For fixed maturity securities in an unrealized loss position, an other-than-temporary impairment ("OTTI") is recognized in earnings when it is anticipated that the amortized cost will not be recovered. When either: (i) the Company has the intent to sell the security; or (ii) it is more likely than not that the Company will be required to sell the security before recovery, the OTTI recognized in earnings is the entire difference between the security's amortized cost and estimated fair value. If neither of these conditions exist, the difference between the amortized cost of the security and the present value of projected future cash flows expected to be collected is recognized as an OTTI in earnings ("credit loss"). If the estimated fair value is less than the present value of projected future cash flows expected to be collected, this portion of OTTI related to other-than-credit factors ("noncredit loss") is recorded in OCI. With respect to equity securities, the Company considers in its OTTI analysis its intent and ability to hold a particular equity security for a period of time sufficient to allow for the recovery of its estimated fair value to an 18 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 1. Business, Basis of Presentation and Summary of Significant Accounting Policies (continued) amount equal to or greater than cost. If a sale decision is made for an equity security and recovery to an amount at least equal to cost prior to the sale is not expected, the security will be deemed to be other-than-temporarily impaired in the period that the sale decision was made and an OTTI loss will be recorded in earnings. The OTTI loss recognized is the entire difference between the security's cost and its estimated fair value. Trading and Fair Value Option Securities Trading and fair value option securities are stated at estimated fair value and include investments for which the fair value option ("FVO") has been elected ("FVO Securities") and investments that are actively purchased and sold ("Actively Traded Securities"). Actively Traded Securities principally include fixed maturity securities and short sale agreement liabilities, which are included in other liabilities. FVO Securities include: . fixed maturity and equity securities held-for-investment by the general account to support asset and liability management strategies for certain insurance products ("FVO general account securities"); and . securities held by consolidated securitization entities ("CSEs") ("FVO securities held by CSEs"). Changes in estimated fair value of these securities are included in net investment income, except for certain securities included in FVO Securities where changes are included in net investment gains (losses). Mortgage Loans The Company disaggregates its mortgage loan investments into three portfolio segments: commercial, agricultural, and residential. The accounting policies that are applicable to all portfolio segments are presented below and the accounting policies related to each of the portfolio segments are included in Note 8. Mortgage Loans Held-For-Investment Mortgage loans held-for-investment are stated at unpaid principal balance, adjusted for any unamortized premium or discount, deferred fees or expenses, and are net of valuation allowances. Interest income and prepayment fees are recognized when earned. Interest income is recognized using an effective yield method giving effect to amortization of premiums and accretion of discounts. Also included in mortgage loans held-for-investment are residential mortgage loans for which the FVO was elected. These mortgage loans are stated at estimated fair value. Changes in estimated fair value are recognized in net investment income. Mortgage Loans Held-For-Sale Mortgage loans held-for-sale that were previously designated as held-for-investment, but now are designated as held-for-sale and mortgage loans originated with the intent to sell for which FVO was not elected, are stated at the lower of amortized cost or estimated fair value. 19 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 1. Business, Basis of Presentation and Summary of Significant Accounting Policies (continued) Policy Loans Policy loans are stated at unpaid principal balances. Interest income on such loans is recorded as earned using the contractual interest rate. Generally, accrued interest is capitalized on the policy's anniversary date. Valuation allowances are not established for policy loans, as they are fully collateralized by the cash surrender value of the underlying insurance policies. Any unpaid principal or interest on the loan is deducted from the cash surrender value or the death benefit prior to settlement of the insurance policy. Real Estate Real estate held-for-investment is stated at cost less accumulated depreciation. Depreciation is provided on a straight-line basis over the estimated useful life of the asset (typically 20 to 55 years). Rental income associated with such real estate is recognized on a straight-line basis over the term of the respective leases. The Company periodically reviews its real estate held-for-investment for impairment and tests for recoverability whenever events or changes in circumstances indicate the carrying value may not be recoverable and exceeds its estimated fair value. Properties whose carrying values are greater than their undiscounted cash flows are written down to their estimated fair value, which is generally computed using the present value of expected future cash flows discounted at a rate commensurate with the underlying risks. Real estate for which the Company commits to a plan to sell within one year and actively markets in its current condition for a reasonable price in comparison to its estimated fair value is classified as held-for-sale. Real estate held-for-sale is stated at the lower of depreciated cost or estimated fair value less expected disposition costs and is not depreciated. Real Estate Joint Ventures and Other Limited Partnership Interests The Company uses the equity method of accounting for investments in equity securities when it has significant influence or at least 20% interest and for investments in real estate joint ventures and other limited partnership interests ("investees") when it has more than a minor ownership interest or more than a minor influence over the investee's operations, but does not have a controlling financial interest. The Company generally recognizes its share of the investee's earnings on a three-month lag in instances where the investee's financial information is not sufficiently timely or when the investee's reporting period differs from the Company's reporting period. The Company uses the cost method of accounting for investments in which it has virtually no influence over the investee's operations. The Company recognizes distributions on cost method investments as earned or received. Because of the nature and structure of these cost method investments, they do not meet the characteristics of an equity security in accordance with applicable accounting standards. The Company routinely evaluates its equity method and cost method investments for impairment. For equity method investees, the Company considers financial and other information provided by the investee, other known information and inherent risks in the underlying investments, as well as future capital commitments, in determining whether an impairment has occurred. The Company considers its cost method investments for impairment when the carrying value of such investments exceeds the net asset value ("NAV"). The Company takes into consideration the severity and duration of this excess when determining whether the cost method investment is impaired. 20 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 1. Business, Basis of Presentation and Summary of Significant Accounting Policies (continued) Short-term Investments Short-term investments include securities and other investments with remaining maturities of one year or less, but greater than three months, at the time of purchase and are stated at estimated fair value or amortized cost, which approximates estimated fair value. Short-term investments also include investments in affiliated money market pools. Other Invested Assets Other invested assets consist principally of the following: . Freestanding derivatives with positive estimated fair values are described in "-- Derivatives" below. . Tax credit and renewable energy partnerships derive a significant source of investment return in the form of income tax credits or other tax incentives. Where tax credits are guaranteed by a creditworthy third party, the investment is accounted for under the effective yield method. Otherwise, the investment is accounted for under the equity method. . Loans to affiliates are stated at unpaid principal balance, adjusted for any unamortized premium or discount. . Leveraged leases are recorded net of non-recourse debt. Income on leveraged leases is recognized by applying the leveraged lease's estimated rate of return to the net investment in the lease. The Company regularly reviews residual values for impairment. . Funds withheld represent a receivable for amounts contractually withheld by ceding companies in accordance with reinsurance agreements. The Company recognizes interest on funds withheld at rates defined by the terms of the agreement which may be contractually specified or directly related to the underlying investments. . Investments in joint ventures that engage in insurance underwriting activities are accounted for under the equity method. Securities Lending Program Securities lending transactions, whereby blocks of securities are loaned to third parties, primarily brokerage firms and commercial banks, are treated as financing arrangements and the associated liability is recorded at the amount of cash received. The Company obtains collateral at the inception of the loan, usually cash, in an amount generally equal to 102% of the estimated fair value of the securities loaned, and maintains it at a level greater than or equal to 100% for the duration of the loan. The Company is liable to return to the counterparties the cash collateral received. Security collateral on deposit from counterparties in connection with the securities lending transactions may not be sold or repledged, unless the counterparty is in default, and is not reflected in the financial statements. The Company monitors the estimated fair value of the securities loaned on a daily basis and additional collateral is obtained as necessary. Income and expenses associated with securities lending transactions are reported as investment income and investment expense, respectively, within net investment income. 21 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) Derivatives Freestanding Derivatives Freestanding derivatives are carried in the Company's balance sheets either as assets within other invested assets or as liabilities within other liabilities at estimated fair value. The Company does not offset the fair value amounts recognized for derivatives executed with the same counterparty under the same master netting agreement. Accruals on derivatives are generally recorded in accrued investment income or within other liabilities. However, accruals that are not scheduled to settle within one year are included with the derivatives carrying value in other invested assets or other liabilities. If a derivative is not designated as an accounting hedge or its use in managing risk does not qualify for hedge accounting, changes in the estimated fair value of the derivative are reported in net derivative gains (losses) except as follows: ------------------------------------------------------------------------------- Statement of Operations Presentation: Derivative: ------------------------------------------------------------------------------- Net investment income . Economic hedges of equity method investments in joint ventures . All derivatives held in relation to trading portfolios ------------------------------------------------------------------------------- Hedge Accounting To qualify for hedge accounting, at the inception of the hedging relationship, the Company formally documents its risk management objective and strategy for undertaking the hedging transaction, as well as its designation of the hedge. Hedge designation and financial statement presentation of changes in estimated fair value of the hedging derivatives are as follows: . Fair value hedge (a hedge of the estimated fair value of a recognized asset or liability) -- in net derivative gains (losses), consistent with the change in fair value of the hedged item attributable to the designated risk being hedged. . Cash flow hedge (a hedge of a forecasted transaction or of the variability of cash flows to be received or paid related to a recognized asset or liability) -- effectiveness in OCI (deferred gains or losses on the derivative are reclassified into the statement of operations when the Company's earnings are affected by the variability in cash flows of the hedged item); ineffectiveness in net derivative gains (losses). The change in estimated fair values of the hedging derivatives are exclusive of any accruals that are separately reported in the statement of operations within interest income or interest expense to match the location of the hedged item. In its hedge documentation, the Company sets forth how the hedging instrument is expected to hedge the designated risks related to the hedged item and sets forth the method that will be used to retrospectively and prospectively assess the hedging instrument's effectiveness and the method that will be used to measure 22 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 1. Business, Basis of Presentation and Summary of Significant Accounting Policies (continued) ineffectiveness. A derivative designated as a hedging instrument must be assessed as being highly effective in offsetting the designated risk of the hedged item. Hedge effectiveness is formally assessed at inception and at least quarterly throughout the life of the designated hedging relationship. Assessments of hedge effectiveness and measurements of ineffectiveness are also subject to interpretation and estimation and different interpretations or estimates may have a material effect on the amount reported in net income. The Company discontinues hedge accounting prospectively when: (i) it is determined that the derivative is no longer highly effective in offsetting changes in the estimated fair value or cash flows of a hedged item; (ii) the derivative expires, is sold, terminated, or exercised; (iii) it is no longer probable that the hedged forecasted transaction will occur; or (iv) the derivative is de-designated as a hedging instrument. When hedge accounting is discontinued because it is determined that the derivative is not highly effective in offsetting changes in the estimated fair value or cash flows of a hedged item, the derivative continues to be carried in the balance sheets at its estimated fair value, with changes in estimated fair value recognized in net derivative gains (losses). The carrying value of the hedged recognized asset or liability under a fair value hedge is no longer adjusted for changes in its estimated fair value due to the hedged risk, and the cumulative adjustment to its carrying value is amortized into income over the remaining life of the hedged item. Provided the hedged forecasted transaction is still probable of occurrence, the changes in estimated fair value of derivatives recorded in OCI related to discontinued cash flow hedges are released into the statements of operations when the Company's earnings are affected by the variability in cash flows of the hedged item. When hedge accounting is discontinued because it is no longer probable that the forecasted transactions will occur on the anticipated date or within two months of that date, the derivative continues to be carried in the balance sheets at its estimated fair value, with changes in estimated fair value recognized currently in net derivative gains (losses). Deferred gains and losses of a derivative recorded in OCI pursuant to the discontinued cash flow hedge of a forecasted transaction that is no longer probable are recognized immediately in net derivative gains (losses). In all other situations in which hedge accounting is discontinued, the derivative is carried at its estimated fair value in the balance sheets, with changes in its estimated fair value recognized in the current period as net derivative gains (losses). Embedded Derivatives The Company sells variable annuities and issues certain insurance products and investment contracts and is a party to certain reinsurance agreements that have embedded derivatives. The Company assesses each identified embedded derivative to determine whether it is required to be bifurcated. The embedded derivative is bifurcated from the host contract and accounted for as a freestanding derivative if: . the combined instrument is not accounted for in its entirety at fair value with changes in fair value recorded in earnings; . the terms of the embedded derivative are not clearly and closely related to the economic characteristics of the host contract; and . a separate instrument with the same terms as the embedded derivative would qualify as a derivative instrument. 23 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 1. Business, Basis of Presentation and Summary of Significant Accounting Policies (continued) Such embedded derivatives are carried in the balance sheets at estimated fair value with the host contract and changes in their estimated fair value are generally reported in net derivative gains (losses). If the Company is unable to properly identify and measure an embedded derivative for separation from its host contract, the entire contract is carried on the balance sheet at estimated fair value, with changes in estimated fair value recognized in the current period in net investment gains (losses) or net investment income. Additionally, the Company may elect to carry an entire contract on the balance sheet at estimated fair value, with changes in estimated fair value recognized in the current period in net investment gains (losses) or net investment income if that contract contains an embedded derivative that requires bifurcation. At inception, the Company attributes to the embedded derivative a portion of the projected future guarantee fees to be collected from the policyholder equal to the present value of projected future guaranteed benefits. Any additional fees represent "excess" fees and are reported in universal life and investment-type product policy fees. Fair Value Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. In most cases, the exit price and the transaction (or entry) price will be the same at initial recognition. Subsequent to initial recognition, fair values are based on unadjusted quoted prices for identical assets or liabilities in active markets that are readily and regularly obtainable. When such quoted prices are not available, fair values are based on quoted prices in markets that are not active, quoted prices for similar but not identical assets or liabilities, or other observable inputs. If these inputs are not available, or observable inputs are not determinable, unobservable inputs and/or adjustments to observable inputs requiring management judgment are used to determine the estimated fair value of assets and liabilities. Goodwill Goodwill, which is included in other assets, represents the future economic benefits arising from net assets acquired in a business combination that are not individually identified and recognized. Goodwill is calculated as the excess of cost over the estimated fair value of such net assets acquired, is not amortized, and is tested for impairment based on a fair value approach at least annually or more frequently if events or circumstances indicate that there may be justification for conducting an interim test. The Company performs its annual goodwill impairment testing during the third quarter of each year based upon data as of the close of the second quarter. Goodwill associated with a business acquisition is not tested for impairment during the year the business is acquired unless there is a significant identified impairment event. The impairment test is performed at the reporting unit level, which is the operating segment or a business one level below the operating segment, if discrete financial information is prepared and regularly reviewed by management at that level. For purposes of goodwill impairment testing, if the carrying value of a reporting unit exceeds its estimated fair value, there may be an indication of impairment. In such instances, the implied fair value of the goodwill is determined in the same manner as the amount of goodwill that would be determined in a business combination. The excess of the carrying value of goodwill over the implied fair value of goodwill would be recognized as an impairment and recorded as a charge against net income. 24 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 1. Business, Basis of Presentation and Summary of Significant Accounting Policies (continued) On an ongoing basis, the Company evaluates potential triggering events that may affect the estimated fair value of the Company's reporting units to assess whether any goodwill impairment exists. Deteriorating or adverse market conditions for certain reporting units may have an impact on the estimated fair value of these reporting units and could result in future impairments of goodwill. Employee Benefit Plans The Company sponsors and administers various qualified and non-qualified defined benefit pension plans and other postretirement employee benefit plans covering eligible employees and sales representatives who meet specified eligibility requirements of the sponsor and its participating affiliates. A December 31 measurement date is used for all of the Company's defined benefit pension and other postretirement benefit plans. The Company recognizes the funded status of the projected benefit obligation ("PBO") for pension benefits and the accumulated postretirement benefit obligation ("APBO") for other postretirement benefits for each of its plans. The Company recognizes an expense for differences between actual experience and estimates over the average future service period of participants. The actuarial gains (losses), prior service costs and credits not yet included in net periodic benefit costs are charged to accumulated OCI ("AOCI"), net of income tax. The Company also sponsors defined contribution plans for substantially all U.S. employees under which a portion of participant contributions is matched. Applicable matching contributions are made each payroll period. Accordingly, the Company recognizes compensation cost for current matching contributions. As all contributions are transferred currently as earned to the defined contribution plans, no liability for matching contributions is recognized in the balance sheets. Income Tax Metropolitan Life Insurance Company and all of its includable subsidiaries join with MetLife, Inc. and its includable subsidiaries in filing a consolidated U.S. life and non-life federal income tax return in accordance with the provisions of the Internal Revenue Code of 1986, as amended (the "Code"). Current taxes (and the benefits of tax attributes such as losses) are allocated to Metropolitan Life Insurance Company and its subsidiaries under the consolidated tax return regulations and a tax sharing agreement. Under the consolidated tax return regulations, MetLife, Inc. has elected the "percentage method" (and 100 percent under such method) of reimbursing companies for tax attributes such as losses. As a result, 100 percent of tax attributes such as losses are reimbursed by MetLife, Inc. to the extent that consolidated federal income tax of the consolidated federal tax return group is reduced in a year by tax attributes such as losses. Profitable subsidiaries pay to MetLife, Inc. each year the federal income tax which such profitable subsidiary would have paid that year based upon that year's taxable income. If Metropolitan Life Insurance Company or its includable subsidiaries has current or prior deductions and credits (including but not limited to losses) which reduce the consolidated tax liability of the consolidated federal tax return group, the deductions and credits are characterized as realized (or realizable) by Metropolitan Life Insurance Company and its includable subsidiaries when those tax attributes are realized (or realizable) by the consolidated federal tax return group, even if Metropolitan Life Insurance Company or its includable subsidiaries would not have realized the attributes on a stand-alone basis under a "wait and see" method. The Company's accounting for income taxes represents management's best estimate of various events and transactions. 25 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 1. Business, Basis of Presentation and Summary of Significant Accounting Policies (continued) Deferred tax assets and liabilities resulting from temporary differences between the financial reporting and tax bases of assets and liabilities are measured at the balance sheet date using enacted tax rates expected to apply to taxable income in the years the temporary differences are expected to reverse. The realization of deferred tax assets depends upon the existence of sufficient taxable income within the carryback or carryforward periods under the tax law in the applicable tax jurisdiction. Valuation allowances are established when management determines, based on available information, that it is more likely than not that deferred income tax assets will not be realized. Factors in management's determination include the performance of the business and its ability to generate capital gains. Significant judgment is required in determining whether valuation allowances should be established, as well as the amount of such allowances. When making such determination, consideration is given to, among other things, the following: . future taxable income exclusive of reversing temporary differences and carryforwards; . future reversals of existing taxable temporary differences; . taxable income in prior carryback years; and . tax planning strategies. The Company may be required to change its provision for income taxes in certain circumstances. Examples of such circumstances include when estimates used in determining valuation allowances on deferred tax assets significantly change or when receipt of new information indicates the need for adjustment in valuation allowances. Additionally, future events, such as changes in tax laws, tax regulations, or interpretations of such laws or regulations, could have an impact on the provision for income tax and the effective tax rate. Any such changes could significantly affect the amounts reported in the financial statements in the year these changes occur. The Company determines whether it is more likely than not that a tax position will be sustained upon examination by the appropriate taxing authorities before any part of the benefit can be recorded in the financial statements. A tax position is measured at the largest amount of benefit that is greater than 50% likely of being realized upon settlement. Unrecognized tax benefits due to tax uncertainties that do not meet the threshold are included within other liabilities and are charged to earnings in the period that such determination is made. The Company classifies interest recognized as interest expense and penalties recognized as a component of income tax. Litigation Contingencies The Company is a party to a number of legal actions and is involved in a number of regulatory investigations. Given the inherent unpredictability of these matters, it is difficult to estimate the impact on the Company's financial position. Liabilities are established when it is probable that a loss has been incurred and the amount of the loss can be reasonably estimated. Except as otherwise disclosed in Note 17, legal costs are recognized as incurred. On a quarterly and annual basis, the Company reviews relevant information with respect to liabilities for litigation, regulatory investigations and litigation-related contingencies to be reflected in the Company's financial statements. 26 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 1. Business, Basis of Presentation and Summary of Significant Accounting Policies (continued) Other Accounting Policies Redeemable Noncontrolling Interests Redeemable noncontrolling interests associated with certain joint ventures and partially-owned consolidated subsidiaries are reported in the temporary section of the balance sheet. Stock-Based Compensation Stock-based compensation recognized in the Company's consolidated results of operations is allocated from MetLife, Inc. The accounting policies described below represent those that MetLife, Inc. applies in determining such allocated expenses. MetLife, Inc. grants certain employees and directors stock-based compensation awards under various plans that are subject to specific vesting conditions. With the exception of performance shares granted in 2013 which are remeasured quarterly, the cost of all stock-based transactions is measured at fair value at grant date and recognized over the period during which a grantee is required to provide services in exchange for the award. Although the terms of MetLife, Inc.'s stock-based plans do not accelerate vesting upon retirement, or the attainment of retirement eligibility, the requisite service period subsequent to attaining such eligibility is considered nonsubstantive. Accordingly, MetLife, Inc. recognizes compensation expense related to stock-based awards over the shorter of the requisite service period or the period to attainment of retirement eligibility. An estimation of future forfeitures of stock-based awards is incorporated into the determination of compensation expense when recognizing expense over the requisite service period. Cash and Cash Equivalents The Company considers all highly liquid securities and other investments purchased with an original or remaining maturity of three months or less at the date of purchase to be cash equivalents. Cash equivalents are stated at amortized cost, which approximates estimated fair value. Property, Equipment, Leasehold Improvements and Computer Software Property, equipment and leasehold improvements, which are included in other assets, are stated at cost, less accumulated depreciation and amortization. Depreciation is determined using the straight-line method over the estimated useful lives of the assets, as appropriate. The estimated life is generally 40 years for company occupied real estate property, from one to 25 years for leasehold improvements, and from three to seven years for all other property and equipment. The cost basis of the property, equipment and leasehold improvements was $1.2 billion and $1.7 billion at December 31, 2013 and 2012, respectively. Accumulated depreciation and amortization of property, equipment and leasehold improvements was $667 million and $1.0 billion at December 31, 2013 and 2012, respectively. Related depreciation and amortization expense was $115 million, $121 million and $118 million for the years ended December 31, 2013, 2012 and 2011, respectively. Computer software, which is included in other assets, is stated at cost, less accumulated amortization. Purchased software costs, as well as certain internal and external costs incurred to develop internal-use computer software during the application development stage, are capitalized. Such costs are amortized 27 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 1. Business, Basis of Presentation and Summary of Significant Accounting Policies (continued) generally over a four-year period using the straight-line method. The cost basis of computer software was $1.0 billion and $902 million at December 31, 2013 and 2012, respectively. Accumulated amortization of capitalized software was $739 million and $611 million at December 31, 2013 and 2012, respectively. Related amortization expense was $144 million, $143 million and $145 million for the years ended December 31, 2013, 2012 and 2011, respectively. Other Revenues Other revenues include, in addition to items described elsewhere herein, advisory fees, broker-dealer commissions and fees, administrative service fees, and changes in account value relating to corporate-owned life insurance ("COLI"). Such fees and commissions are recognized in the period in which services are performed. Under certain COLI contracts, if the Company reports certain unlikely adverse results in its financial statements, withdrawals would not be immediately available and would be subject to market value adjustment, which could result in a reduction of the account value. Policyholder Dividends Policyholder dividends are approved annually by Metropolitan Life Insurance Company and its insurance subsidiaries' boards of directors. The aggregate amount of policyholder dividends is related to actual interest, mortality, morbidity and expense experience for the year, as well as management's judgment as to the appropriate level of statutory surplus to be retained by Metropolitan Life Insurance Company and its insurance subsidiaries. Foreign Currency Assets, liabilities and operations of foreign affiliates and subsidiaries, if any, are recorded based on the functional currency of each entity. The determination of the functional currency is made based on the appropriate economic and management indicators. The local currencies of foreign operations are the functional currencies. Assets and liabilities of foreign affiliates and subsidiaries, if any, are translated from the functional currency to U.S. dollars at the exchange rates in effect at each year-end and income and expense accounts are translated at the average exchange rates during the year. The resulting translation adjustments are charged or credited directly to OCI, net of applicable taxes. Gains and losses from foreign currency transactions, including the effect of re-measurement of monetary assets and liabilities to the appropriate functional currency, are reported as part of net investment gains (losses) in the period in which they occur. Adoption of New Accounting Pronouncements Effective July 17, 2013, the Company adopted new guidance regarding derivatives that permits the Fed Funds Effective Swap Rate (or Overnight Index Swap Rate) to be used as a U.S. benchmark interest rate for hedge accounting purposes, in addition to the United States Treasury and London Interbank Offered Rate ("LIBOR"). Also, this new guidance removes the restriction on using different benchmark rates for similar hedges. The new guidance did not have a material impact on the financial statements upon adoption, but may impact the selection of benchmark interest rates for hedging relationships in the future. 28 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 1. Business, Basis of Presentation and Summary of Significant Accounting Policies (continued) Effective January 1, 2013, the Company adopted new guidance regarding comprehensive income that requires an entity to provide information about the amounts reclassified out of AOCI by component. In addition, an entity is required to present, either on the face of the statement where net income is presented or in the notes, significant amounts reclassified out of AOCI by the respective line items of net income but only if the amount reclassified is required under GAAP to be reclassified to net income in its entirety in the same reporting period. For other amounts that are not required under GAAP to be reclassified in their entirety to net income, an entity is required to cross-reference to other disclosures required under GAAP that provide additional detail about those amounts. The adoption was prospectively applied and resulted in additional disclosures in Note 13. Effective January 1, 2013, the Company adopted new guidance regarding balance sheet offsetting disclosures which requires an entity to disclose information about offsetting and related arrangements for derivatives, including bifurcated embedded derivatives, repurchase and reverse repurchase agreements, and securities borrowing and lending transactions, to enable users of its financial statements to understand the effects of those arrangements on its financial position. Entities are required to disclose both gross information and net information about both instruments and transactions eligible for offset in the statement of financial position and instruments and transactions subject to an agreement similar to a master netting arrangement. The adoption was retrospectively applied and resulted in additional disclosures related to derivatives in Note 9. On January 1, 2012, the Company adopted new guidance regarding accounting for DAC, which was retrospectively applied. The guidance specifies that only costs related directly to successful acquisition of new or renewal contracts can be capitalized as DAC; all other acquisition-related costs must be expensed as incurred. As a result, certain sales manager compensation and administrative cost previously capitalized by the Company will no longer be deferred. On January 1, 2012, the Company adopted new guidance regarding comprehensive income, which was retrospectively applied, that provides companies with the option to present the total of comprehensive income, components of net income, and the components of OCI either in a single continuous statement of comprehensive income or in two separate but consecutive statements in annual financial statements. The standard eliminates the option to present components of OCI as part of the statement of changes in stockholders' equity. The Company adopted the two-statement approach for annual financial statements. Effective January 1, 2012, the Company adopted new guidance on goodwill impairment testing that simplifies how an entity tests goodwill for impairment. This new guidance allows an entity to first assess qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying value as a basis for determining whether it needs to perform the quantitative two-step goodwill impairment test. Only if an entity determines, based on qualitative assessment, that it is more likely than not that a reporting unit's fair value is less than its carrying value will it be required to calculate the fair value of the reporting unit. The qualitative assessment is optional and the Company is permitted to bypass it for any reporting unit in any period and begin its impairment analysis with the quantitative calculation. The Company is permitted to perform the qualitative assessment in any subsequent period. Effective January 1, 2012, the Company adopted new guidance regarding fair value measurements that establishes common requirements for measuring fair value and for disclosing information about fair value measurements in accordance with GAAP and International Financial Reporting Standards. Some of the amendments clarify the Financial Accounting Standards Board's ("FASB") intent on the application of existing 29 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 1. Business, Basis of Presentation and Summary of Significant Accounting Policies (continued) fair value measurement requirements. Other amendments change a particular principle or requirement for measuring fair value or for disclosing information about fair value measurements. The adoption did not have a material impact on the Company's financial statements other than the expanded disclosures in Note 10. Future Adoption of New Accounting Pronouncements In March 2013, the FASB issued new guidance regarding foreign currency (Accounting Standards Update ("ASU") 2013-05, Foreign Currency Matters (Topic 830): Parent's Accounting for the Cumulative Translation Adjustment upon Derecognition of Certain Subsidiaries or Groups of Assets within a Foreign Entity or of an Investment in a Foreign Entity), effective prospectively for fiscal years and interim reporting periods within those years beginning after December 15, 2013. The amendments require an entity that ceases to have a controlling financial interest in a subsidiary or group of assets within a foreign entity to apply the guidance in Subtopic 830-30, Foreign Currency Matters -- Translation of Financial Statements, to release any related cumulative translation adjustment into net income. Accordingly, the cumulative translation adjustment should be released into net income only if the sale or transfer results in the complete or substantially complete liquidation of the foreign entity in which the subsidiary or group of assets had resided. For an equity method investment that is a foreign entity, the partial sale guidance in section 830-30-40, Derecognition, still applies. As such, a pro rata portion of the cumulative translation adjustment should be released into net income upon a partial sale of such an equity method investment. The Company does not expect the adoption of this new guidance to have a material impact on its financial statements. In February 2013, the FASB issued new guidance regarding liabilities (ASU 2013-04, Liabilities (Topic 405): Obligations Resulting from Joint and Several Liability Arrangements for Which the Total Amount of the Obligation Is Fixed at the Reporting Date), effective retrospectively for fiscal years beginning after December 15, 2013 and interim periods within those years. The amendments require an entity to measure obligations resulting from joint and several liability arrangements for which the total amount of the obligation within the scope of the guidance is fixed at the reporting date, as the sum of the amount the reporting entity agreed to pay on the basis of its arrangement among its co-obligors and any additional amount the reporting entity expects to pay on behalf of its co-obligors. In addition, the amendments require an entity to disclose the nature and amount of the obligation, as well as other information about the obligation. The Company does not expect the adoption of this new guidance to have a material impact on its financial statements. In July 2011, the FASB issued new guidance on other expenses (ASU 2011-06, Other Expenses (Topic 720): Fees Paid to the Federal Government by Health Insurers), effective for calendar years beginning after December 31, 2013. The objective of this standard is to address how health insurers should recognize and classify in their income statements fees mandated by the Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act. The amendments in this standard specify that the liability for the fee should be estimated and recorded in full once the entity provides qualifying health insurance in the applicable calendar year in which the fee is payable with a corresponding deferred cost that is amortized to expense using the straight-line method of allocation unless another method better allocates the fee over the calendar year that it is payable. In accordance with the adoption of the new accounting pronouncement, on January 1, 2014, the Company recorded $55 million in other liabilities, and a corresponding deferred cost, in other assets. 30 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 2. Segment Information The Company is organized into three segments: Retail; Group, Voluntary & Worksite Benefits; and Corporate Benefit Funding. In addition, the Company reports certain of its results of operations in Corporate & Other. Retail The Retail segment offers a broad range of protection products and services and a variety of annuities to individuals and employees of corporations and other institutions, and is organized into two businesses: Life & Other and Annuities. Life & Other insurance products and services include variable life, universal life, term life and whole life products. Additionally, through broker-dealer affiliates, the Company offers a full range of mutual funds and other securities products. Life & Other products and services also include individual disability income products. Annuities includes a variety of variable and fixed annuities which provide for both asset accumulation and asset distribution needs. Group, Voluntary & Worksite Benefits The Group, Voluntary & Worksite Benefits segment offers a broad range of protection products and services to individuals and corporations, as well as other institutions and their respective employees, and is organized into two businesses: Group and Voluntary & Worksite. Group insurance products and services include variable life, universal life and term life products. Group insurance products and services also include dental, group short- and long-term disability and accidental death & dismemberment coverages. The Voluntary & Worksite business includes LTC, prepaid legal plans and critical illness products. Corporate Benefit Funding The Corporate Benefit Funding segment offers a broad range of annuity and investment products, including guaranteed interest products and other stable value products, income annuities, and separate account contracts for the investment management of defined benefit and defined contribution plan assets. This segment also includes structured settlements and certain products to fund postretirement benefits and company-, bank- or trust-owned life insurance used to finance non-qualified benefit programs for executives. Corporate & Other Corporate & Other contains the excess capital not allocated to the segments, enterprise-wide strategic initiative restructuring charges, various start-up and certain run-off businesses, the Company's ancillary international operations, interest expense related to the majority of the Company's outstanding debt, as well as expenses associated with certain legal proceedings and income tax audit issues. Start-up businesses include direct and digital marketing products. In addition, starting in 2013, Corporate & Other includes ancillary U.S. sponsored direct business, comprised of group and individual products sold through sponsoring organizations and affinity groups. Corporate & Other also includes our investment management business through which we offer fee-based investment management services to institutional clients. Additionally, Corporate & Other includes the elimination of intersegment amounts, which generally relate to intersegment loans, which bear interest rates commensurate with related borrowings. 31 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 2. Segment Information (continued) Financial Measures and Segment Accounting Policies Operating earnings is the measure of segment profit or loss the Company uses to evaluate segment performance and allocate resources. Consistent with GAAP guidance for segment reporting, operating earnings is the Company's measure of segment performance and is reported below. Operating earnings should not be viewed as a substitute for income (loss) from continuing operations, net of income tax. The Company believes the presentation of operating earnings as the Company measures it for management purposes enhances the understanding of its performance by highlighting the results of operations and the underlying profitability drivers of the business. Operating earnings is defined as operating revenues less operating expenses, both net of income tax. Operating revenues excludes net investment gains (losses) and net derivative gains (losses). The following additional adjustments are made to GAAP revenues, in the line items indicated, in calculating operating revenues: . Universal life and investment-type product policy fees excludes the amortization of unearned revenue related to net investment gains (losses) and net derivative gains (losses) and certain variable annuity GMIB fees ("GMIB Fees"); and . Net investment income: (i) includes amounts for scheduled periodic settlement payments and amortization of premium on derivatives that are hedges of investments or that are used to replicate certain investments, but do not qualify for hedge accounting treatment, (ii) includes income from discontinued real estate operations, (iii) excludes post-tax operating earnings adjustments relating to insurance joint ventures accounted for under the equity method, and (iv) excludes certain amounts related to securitization entities that are VIEs consolidated under GAAP. The following adjustments are made to GAAP expenses, in the line items indicated, in calculating operating expenses: . Policyholder benefits and claims and policyholder dividends excludes: (i) changes in the policyholder dividend obligation related to net investment gains (losses) and net derivative gains (losses), (ii) amounts associated with periodic crediting rate adjustments based on the total return of a contractually referenced pool of assets, (iii) benefits and hedging costs related to GMIBs ("GMIB Costs"), and (iv) market value adjustments associated with surrenders or terminations of contracts ("Market Value Adjustments"); . Interest credited to policyholder account balances includes adjustments for scheduled periodic settlement payments and amortization of premium on derivatives that are hedges of PABs but do not qualify for hedge accounting treatment; . Amortization of DAC and VOBA excludes amounts related to: (i) net investment gains (losses) and net derivative gains (losses), (ii) GMIB Fees and GMIB Costs, and (iii) Market Value Adjustments; . Interest expense on debt excludes certain amounts related to securitization entities that are VIEs consolidated under GAAP; and . Other expenses excludes costs related to noncontrolling interests and goodwill impairments. 32 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 2. Segment Information (continued) Set forth in the tables below is certain financial information with respect to the Company's segments, as well as Corporate & Other, for the years ended December 31, 2013, 2012 and 2011 and at December 31, 2013 and 2012. The segment accounting policies are the same as those used to prepare the Company's consolidated financial statements, except for operating earnings adjustments as defined above. In addition, segment accounting policies include the method of capital allocation described below. Economic capital is an internally developed risk capital model, the purpose of which is to measure the risk in the business and to provide a basis upon which capital is deployed. The economic capital model accounts for the unique and specific nature of the risks inherent in MetLife, Inc.'s and the Company's business. MetLife, Inc.'s economic capital model aligns segment allocated equity with emerging standards and consistent risk principles. The model applies statistics-based risk evaluation principles to the material risks to which the Company is exposed. These consistent risk principles include calibrating required economic capital shock factors to a specific confidence level and time horizon and applying an industry standard method for the inclusion of diversification benefits among risk types. Segment net investment income is credited or charged based on the level of allocated equity; however, changes in allocated equity do not impact the Company's consolidated net investment income, operating earnings or income (loss) from continuing operations, net of income tax. Net investment income is based upon the actual results of each segment's specifically identifiable investment portfolios adjusted for allocated equity. Other costs are allocated to each of the segments based upon: (i) a review of the nature of such costs; (ii) time studies analyzing the amount of employee compensation costs incurred by each segment; and (iii) cost estimates included in the Company's product pricing. 33 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 2. Segment Information (continued)
Operating Earnings ----------------------------------------------------- Group, Voluntary Corporate & Worksite Benefit Corporate Total Year Ended December 31, 2013 Retail Benefits Funding & Other Total Adjustments Consolidated ------------------------------------------- ---------- ---------- ---------- --------- ---------- ----------- ------------ (In millions) Revenues Premiums................................... $ 3,992 $ 13,732 $ 2,675 $ 76 $ 20,475 $ -- $ 20,475 Universal life and investment-type product policy fees............................... 1,397 688 211 -- 2,296 67 2,363 Net investment income...................... 5,385 1,790 4,611 431 12,217 (432) 11,785 Other revenues............................. 328 404 273 694 1,699 -- 1,699 Net investment gains (losses).............. -- -- -- -- -- 48 48 Net derivative gains (losses).............. -- -- -- -- -- (1,070) (1,070) ---------- --------- ---------- --------- ---------- -------- -------- Total revenues........................... 11,102 16,614 7,770 1,201 36,687 (1,387) 35,300 ---------- --------- ---------- --------- ---------- -------- -------- Expenses Policyholder benefits and claims and policyholder dividends.................... 6,246 13,191 4,723 67 24,227 10 24,237 Interest credited to policyholder account balances.................................. 988 156 1,092 -- 2,236 17 2,253 Capitalization of DAC...................... (517) (20) (25) -- (562) -- (562) Amortization of DAC and VOBA............... 447 25 19 -- 491 (230) 261 Interest expense on debt................... 5 1 10 134 150 3 153 Other expenses............................. 2,280 1,988 489 1,348 6,105 31 6,136 ---------- --------- ---------- --------- ---------- -------- -------- Total expenses........................... 9,449 15,341 6,308 1,549 32,647 (169) 32,478 ---------- --------- ---------- --------- ---------- -------- -------- Provision for income tax expense (benefit). 579 446 512 (421) 1,116 (435) 681 ---------- --------- ---------- --------- ---------- -------- Operating earnings......................... $ 1,074 $ 827 $ 950 $ 73 2,924 ========== ========= ========== ========= Adjustments to: Total revenues........................... (1,387) Total expenses........................... 169 Provision for income tax (expense) benefit................................. 435 ---------- Income (loss) from continuing operations, net of income tax......................... $ 2,141 $ 2,141 ========== ======== Group, Voluntary Corporate & Worksite Benefit Corporate At December 31, 2013 Retail Benefits Funding & Other Total ------------------------------------------- ---------- ---------- ---------- --------- ---------- (In millions) Total assets............................... $ 174,853 $ 41,059 $ 188,960 $ 27,911 $ 432,783 Separate account assets.................... $ 59,217 $ 644 $ 74,935 $ -- $ 134,796 Separate account liabilities............... $ 59,217 $ 644 $ 74,935 $ -- $ 134,796
34 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 2. Segment Information (continued)
Operating Earnings ----------------------------------------------------- Group, Voluntary Corporate & Worksite Benefit Corporate Total Year Ended December 31, 2012 Retail Benefits Funding & Other Total Adjustments Consolidated ------------------------------------------- ---------- ---------- ---------- --------- ---------- ----------- ------------ (In millions) Revenues Premiums................................... $ 3,997 $ 13,274 $ 2,608 $ 1 $ 19,880 $ -- $ 19,880 Universal life and investment-type product policy fees............................... 1,332 663 194 -- 2,189 50 2,239 Net investment income...................... 5,384 1,680 4,519 554 12,137 (285) 11,852 Other revenues............................. 265 398 252 815 1,730 -- 1,730 Net investment gains (losses).............. -- -- -- -- -- (330) (330) Net derivative gains (losses).............. -- -- -- -- -- 675 675 ---------- --------- ---------- --------- ---------- ------ -------- Total revenues........................... 10,978 16,015 7,573 1,370 35,936 110 36,046 ---------- --------- ---------- --------- ---------- ------ -------- Expenses Policyholder benefits and claims and policyholder dividends.................... 6,294 12,580 4,552 (1) 23,425 139 23,564 Interest credited to policyholder account balances.................................. 1,002 167 1,192 -- 2,361 29 2,390 Capitalization of DAC...................... (584) (24) (24) -- (632) -- (632) Amortization of DAC and VOBA............... 656 29 12 2 699 292 991 Interest expense on debt................... 5 1 9 133 148 4 152 Other expenses............................. 2,341 1,901 438 1,196 5,876 7 5,883 ---------- --------- ---------- --------- ---------- ------ -------- Total expenses........................... 9,714 14,654 6,179 1,330 31,877 471 32,348 ---------- --------- ---------- --------- ---------- ------ -------- Provision for income tax expense (benefit). 442 477 488 (236) 1,171 (116) 1,055 ---------- --------- ---------- --------- ---------- -------- Operating earnings......................... $ 822 $ 884 $ 906 $ 276 2,888 ========== ========= ========== ========= Adjustments to: Total revenues........................... 110 Total expenses........................... (471) Provision for income tax (expense) benefit................................. 116 ---------- Income (loss) from continuing operations, net of income tax......................... $ 2,643 $ 2,643 ========== ======== Group, Voluntary Corporate & Worksite Benefit Corporate At December 31, 2012 Retail Benefits Funding & Other Total ------------------------------------------- ---------- ---------- ---------- --------- ---------- (In millions) Total assets............................... $ 171,050 $ 41,362 $ 183,856 $ 32,996 $ 429,264 Separate account assets.................... $ 50,572 $ 532 $ 69,867 $ -- $ 120,971 Separate account liabilities............... $ 50,572 $ 532 $ 69,867 $ -- $ 120,971
35 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 2. Segment Information (continued)
Operating Earnings ------------------------------------------------- Group, Voluntary Corporate & Worksite Benefit Corporate Total Year Ended December 31, 2011 Retail Benefits Funding & Other Total Adjustments Consolidated ------------------------------------------- -------- ---------- --------- --------- --------- ----------- ------------ (In millions) Revenues Premiums................................... $ 4,022 $ 12,487 $ 1,778 $ 1 $ 18,288 $ -- $ 18,288 Universal life and investment-type product policy fees............................... 1,334 630 197 -- 2,161 41 2,202 Net investment income...................... 5,363 1,682 4,312 385 11,742 (127) 11,615 Other revenues............................. 226 374 242 966 1,808 -- 1,808 Net investment gains (losses).............. -- -- -- -- -- 132 132 Net derivative gains (losses).............. -- -- -- -- -- 1,578 1,578 -------- --------- -------- -------- --------- ---------- --------- Total revenues........................... 10,945 15,173 6,529 1,352 33,999 1,624 35,623 -------- --------- -------- -------- --------- ---------- --------- Expenses Policyholder benefits and claims and policyholder dividends.................... 6,425 11,880 3,683 4 21,992 44 22,036 Interest credited to policyholder account balances.................................. 1,000 178 1,140 -- 2,318 54 2,372 Capitalization of DAC...................... (622) (84) (18) -- (724) -- (724) Amortization of DAC and VOBA............... 681 95 14 1 791 84 875 Interest expense on debt................... 5 -- 8 172 185 9 194 Other expenses............................. 2,564 1,837 472 1,247 6,120 6 6,126 -------- --------- -------- -------- --------- ---------- --------- Total expenses........................... 10,053 13,906 5,299 1,424 30,682 197 30,879 -------- --------- -------- -------- --------- ---------- --------- Provision for income tax expense (benefit)................................. 314 445 432 (229) 962 498 1,460 -------- --------- -------- -------- --------- --------- Operating earnings......................... $ 578 $ 822 $ 798 $ 157 2,355 ======== ========= ======== ======== Adjustments to: Total revenues........................... 1,624 Total expenses........................... (197) Provision for income tax (expense) benefit....................... (498) --------- Income (loss) from continuing operations, net of income tax............. $ 3,284 $ 3,284 ========= =========
The following table presents total premiums, universal life and investment-type product policy fees and other revenues by major product groups of the Company's segments, as well as Corporate & Other:
Years Ended December 31, ----------------------------- 2013 2012 2011 --------- --------- --------- (In millions) Life insurance (1)............ $ 17,489 $ 17,224 $ 16,209 Accident and health insurance. 6,873 6,458 5,940 Non-insurance................. 175 167 149 --------- --------- --------- Total........................ $ 24,537 $ 23,849 $ 22,298 ========= ========= =========
-------- (1) Includes annuities and corporate benefit funding products. Revenues derived from one Group, Voluntary & Worksite Benefits customer were $2.5 billion, $2.5 billion and $2.4 billion for the years ended December 31, 2013, 2012 and 2011, respectively, which represented 10%, 36 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 2. Segment Information (continued) 11% and 11%, respectively, of consolidated premiums, universal life and investment-type product policy fees and other revenues. Revenues derived from any other customer did not exceed 10% of consolidated premiums, universal life and investment-type product policy fees and other revenues for the years ended December 31, 2013, 2012 and 2011. Substantially all of the Company's consolidated premiums, universal life & investment-type product policy fees and other revenues originated in the U.S. 3. Discontinued Operations The following table summarizes the amounts that have been reflected as discontinued operations in the consolidated statements of operations. Income (loss) from discontinued operations includes real estate classified as held-for-sale or sold.
Years Ended December 31, ----------------------- 2013 2012 2011 ------- ------- ------- (In millions) Total revenues................................................... $ 2 $ 62 $ 105 Total expenses................................................... -- -- -- ------- ------- ------- Income (loss) before provision for income tax.................... 2 62 105 Provision for income tax expense (benefit)....................... 1 22 37 ------- ------- ------- Income (loss) from operations of discontinued operations, net of income tax..................................................... 1 40 68 Gain (loss) on disposal of operations, net of income tax......... -- -- (7) ------- ------- ------- Income (loss) from discontinued operations, net of income tax.... $ 1 $ 40 $ 61 ======= ======= =======
4. Insurance Insurance Liabilities Insurance liabilities, including affiliated insurance liabilities on reinsurance assumed and ceded, are comprised of future policy benefits, PABs and other policy-related balances. Information regarding insurance liabilities by segment, as well as Corporate & Other, was as follows at:
December 31, --------------------- 2013 2012 ---------- ---------- (In millions) Retail............................... $ 91,575 $ 92,322 Group, Voluntary & Worksite Benefits. 28,035 28,517 Corporate Benefit Funding............ 89,941 93,051 Corporate & Other.................... 581 475 ---------- ---------- Total............................... $ 210,132 $ 214,365 ========== ==========
See Note 6 for discussion of affiliated reinsurance liabilities included in the table above. 37 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 4. Insurance (continued) Future policy benefits are measured as follows: Product Type: Measurement Assumptions: --------------------------------------------------------------------------- Participating life Aggregate of (i) net level premium reserves for death and endowment policy benefits (calculated based upon the non-forfeiture interest rate, ranging from 3% to 7%, and mortality rates guaranteed in calculating the cash surrender values described in such contracts); and (ii) the liability for terminal dividends. --------------------------------------------------------------------------- Nonparticipating life Aggregate of the present value of expected future benefit payments and related expenses less the present value of expected future net premiums. Assumptions as to mortality and persistency are based upon the Company's experience when the basis of the liability is established. Interest rate assumptions for the aggregate future policy benefit liabilities range from 2% to 10%. --------------------------------------------------------------------------- Individual and group traditional Present value of expected future fixed annuities after annuitization payments. Interest rate assumptions used in establishing such liabilities range from 1% to 11%. --------------------------------------------------------------------------- Non-medical health insurance The net level premium method and assumptions as to future morbidity, withdrawals and interest, which provide a margin for adverse deviation. Interest rate assumptions used in establishing such liabilities range from 4% to 7%. --------------------------------------------------------------------------- Disabled lives Present value of benefits method and experience assumptions as to claim terminations, expenses and interest. Interest rate assumptions used in establishing such liabilities range from 2% to 8%. --------------------------------------------------------------------------- Participating business represented 5% of the Company's life insurance in-force at both December 31, 2013 and 2012. Participating policies represented 28%, 29% and 32% of gross life insurance premiums for the years ended December 31, 2013, 2012 and 2011, respectively. PABs are equal to: (i) policy account values, which consist of an accumulation of gross premium payments (ii) credited interest, ranging from 1% to 13%, less expenses, mortality charges and withdrawals; and (iii) fair value adjustments relating to business combinations. 38 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 4. Insurance (continued) Guarantees The Company issues variable annuity products with guaranteed minimum benefits. The non-life contingent portion of GMWBs and the portion of certain GMIBs that does not require annuitization are accounted for as embedded derivatives in PABs and are further discussed in Note 9. Guarantees accounted for as insurance liabilities include: Guarantee: Measurement Assumptions: ------------------------------------------------------------------------------------------------- GMDBs . A return of purchase payment upon Present value of expected death benefits in death even if the account value is excess of the projected account balance reduced to zero. recognizing the excess ratably over the accumulation period based on the present value of total expected assessments. ------------------------------------------------------------------------------------------------- . An enhanced death benefit may be Assumptions are consistent with those used available for an additional fee. for amortizing DAC, and are thus subject to the same variability and risk. Investment performance and volatility assumptions are consistent with the historical experience of the appropriate underlying equity index, such as the S&P 500 Index. Benefit assumptions are based on the average benefits payable over a range of scenarios. ------------------------------------------------------------------------------------------------- GMIBs . After a specified period of time Present value of expected income benefits in determined at the time of issuance excess of the projected account balance at of the variable annuity contract, any future date of annuitization and a minimum accumulation of purchase recognizing the excess ratably over the payments, even if the account accumulation period based on present value value is reduced to zero, that can of total expected assessments. be annuitized to receive a monthly income stream that is not less than a specified amount. . Certain contracts also provide for Assumptions are consistent with those used a guaranteed lump sum return of for estimating GMDB liabilities. purchase premium in lieu of the annuitization benefit. Calculation incorporates an assumption for the percentage of the potential annuitizations that may be elected by the contractholder. ------------------------------------------------------------------------------------------------- GMWBs. . A return of purchase payment via Expected value of the life contingent partial withdrawals, even if the payments and expected assessments using account value is reduced to zero, assumptions consistent with those used for provided that cumulative estimating the GMDB liabilities. withdrawals in a contract year do not exceed a certain limit. . Certain contracts include guaranteed withdrawals that are life contingent.
39 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 4. Insurance (continued) The Company also issues annuity contracts that apply a lower rate on funds deposited if the contractholder elects to surrender the contract for cash and a higher rate if the contractholder elects to annuitize ("two tier annuities"). These guarantees include benefits that are payable in the event of death, maturity or at annuitization. Additionally, the Company issues universal and variable life contracts where the Company contractually guarantees to the contractholder a secondary guarantee or a guaranteed paid-up benefit. Information regarding the liabilities for guarantees (excluding base policy liabilities and embedded derivatives) relating to annuity and universal and variable life contracts was as follows:
Universal and Variable Annuity Contracts Life Contracts ---------------- --------------------- Secondary Paid-Up GMDBs GMIBs Guarantees Guarantees Total ------- -------- ---------- ---------- -------- (In millions) Direct Balance at January 1, 2011... $ 61 $ 113 $ 246 $ 49 $ 469 Incurred guaranteed benefits. 30 45 15 9 99 Paid guaranteed benefits..... (7) -- -- -- (7) ------- -------- -------- ------- -------- Balance at December 31, 2011. 84 158 261 58 561 Incurred guaranteed benefits. 31 174 79 10 294 Paid guaranteed benefits..... (6) -- -- -- (6) ------- -------- -------- ------- -------- Balance at December 31, 2012. 109 332 340 68 849 Incurred guaranteed benefits. 44 58 77 6 185 Paid guaranteed benefits..... (5) -- -- -- (5) ------- -------- -------- ------- -------- Balance at December 31, 2013 $ 148 $ 390 $ 417 $ 74 $ 1,029 ======= ======== ======== ======= ======== Ceded Balance at January 1, 2011... $ 44 $ 36 $ 209 $ 34 $ 323 Incurred guaranteed benefits. 25 16 3 7 51 Paid guaranteed benefits..... (7) -- -- -- (7) ------- -------- -------- ------- -------- Balance at December 31, 2011. 62 52 212 41 367 Incurred guaranteed benefits. 30 58 53 6 147 Paid guaranteed benefits..... (6) -- -- -- (6) ------- -------- -------- ------- -------- Balance at December 31, 2012. 86 110 265 47 508 Incurred guaranteed benefits. 39 14 49 4 106 Paid guaranteed benefits..... (5) -- -- -- (5) ------- -------- -------- ------- -------- Balance at December 31, 2013. $ 120 $ 124 $ 314 $ 51 $ 609 ======= ======== ======== ======= ======== Net Balance at January 1, 2011... $ 17 $ 77 $ 37 $ 15 $ 146 Incurred guaranteed benefits. 5 29 12 2 48 Paid guaranteed benefits..... -- -- -- -- -- ------- -------- -------- ------- -------- Balance at December 31, 2011. 22 106 49 17 194 Incurred guaranteed benefits. 1 116 26 4 147 Paid guaranteed benefits..... -- -- -- -- -- ------- -------- -------- ------- -------- Balance at December 31, 2012. 23 222 75 21 341 Incurred guaranteed benefits. 5 44 28 2 79 Paid guaranteed benefits..... -- -- -- -- -- ------- -------- -------- ------- -------- Balance at December 31, 2013. $ 28 $ 266 $ 103 $ 23 $ 420 ======= ======== ======== ======= ========
40 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 4. Insurance (continued) Account balances of contracts with insurance guarantees were invested in separate account asset classes as follows at:
December 31, ------------------- 2013 2012 --------- --------- (In millions) Fund Groupings: Equity.......... $ 24,915 $ 20,475 Balanced........ 22,481 19,235 Bond............ 4,551 4,771 Money Market.... 179 192 --------- --------- Total.......... $ 52,126 $ 44,673 ========= =========
Based on the type of guarantee, the Company defines net amount at risk as listed below. These amounts include direct business, but exclude offsets from hedging or reinsurance, if any. Variable Annuity Guarantees In the Event of Death Defined as the death benefit less the total contract account value, as of the balance sheet date. It represents the amount of the claim that the Company would incur if death claims were filed on all contracts on the balance sheet date and includes any additional contractual claims associated with riders purchased to assist with covering income taxes payable upon death. At Annuitization Defined as the amount (if any) that would be required to be added to the total contract account value to purchase a lifetime income stream, based on current annuity rates, equal to the minimum amount provided under the guaranteed benefit. This amount represents the Company's potential economic exposure to such guarantees in the event all contractholders were to annuitize on the balance sheet date, even though the contracts contain terms that allow annuitization of the guaranteed amount only after the 10th anniversary of the contract, which not all contractholders have achieved. Two Tier Annuities Defined as the excess of the upper tier, adjusted for a profit margin, less the lower tier, as of the balance sheet date. These contracts apply a lower rate on funds if the contractholder elects to surrender the contract for cash and a higher rate if the contractholder elects to annuitize. Universal and Variable Life Contracts Defined as the guarantee amount less the account value, as of the balance sheet date. It represents the amount of the claim that the Company would incur if death claims were filed on all contracts on the balance sheet date. 41 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 4. Insurance (continued) Information regarding the types of guarantees relating to annuity contracts and universal and variable life contracts was as follows at:
December 31, --------------------------------------------------------- 2013 2012 ---------------------------- ---------------------------- In the At In the At Event of Death Annuitization Event of Death Annuitization -------------- ------------- -------------- ------------- (In millions) Annuity Contracts (1) Variable Annuity Guarantees Total contract account value................. $ 62,763 $ 28,934 $ 55,469 $ 24,229 Separate account value....................... $ 50,700 $ 27,738 $ 43,327 $ 22,963 Net amount at risk........................... $ 641 $ 123 $ 902 $ 845 Average attained age of contractholders...... 64 years 62 years 64 years 60 years Two Tier Annuities General account value........................ N/A $ 397 N/A $ 274 Net amount at risk........................... N/A $ 123 N/A $ 48 Average attained age of contractholders...... N/A 54 years N/A 64 years December 31, --------------------------------------------------------- 2013 2012 ---------------------------- ---------------------------- Secondary Paid-Up Secondary Paid-Up Guarantees Guarantees Guarantees Guarantees -------------- ------------- -------------- ------------- (In millions) Universal and Variable Life Contracts (1) Account value (general and separate account). $ 7,871 $ 1,125 $ 6,958 $ 1,163 Net amount at risk........................... $ 81,888 $ 8,701 $ 85,216 $ 9,299 Average attained age of policyholders........ 53 years 59 years 52 years 59 years
-------- (1)The Company's annuity and life contracts with guarantees may offer more than one type of guarantee in each contract. Therefore, the amounts listed above may not be mutually exclusive. Obligations Under Funding Agreements The Company issues fixed and floating rate funding agreements, which are denominated in either U.S. dollars or foreign currencies, to certain special purpose entities ("SPEs") that have issued either debt securities or commercial paper for which payment of interest and principal is secured by such funding agreements. During the years ended December 31, 2013, 2012 and 2011, the Company issued $26.8 billion, $24.7 billion and $27.4 billion, respectively, and repaid $25.1 billion, $21.5 billion and $28.2 billion, respectively, of such funding agreements. At December 31, 2013 and 2012, liabilities for funding agreements outstanding, which are included in PABs, were $26.0 billion and $23.9 billion, respectively. 42 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 4. Insurance (continued) Metropolitan Life Insurance Company and General American Life Insurance Company ("GALIC"), a subsidiary, are members of regional banks in the FHLB system ("FHLBanks"). Holdings of common stock of FHLBanks, included in equity securities, were as follows at:
December 31, ------------- 2013 2012 ------ ------ (In millions) FHLB of NY......... $ 700 $ 736 FHLB of Des Moines. $ 50 $ 55
The Company has also entered into funding agreements with FHLBanks and the Federal Agricultural Mortgage Corporation, a federally chartered instrumentality of the U.S. ("Farmer Mac"). The liability for such funding agreements is included in PABs. Information related to such funding agreements was as follows at:
Liability Collateral ------------------- --------------------------- December 31, ----------------------------------------------- 2013 2012 2013 2012 --------- --------- ------------- ------------- (In millions) FHLB of NY (1)......... $ 12,770 $ 13,512 $ 14,287 (2) $ 14,611 (2) Farmer Mac (3)......... $ 2,550 $ 2,550 $ 2,929 $ 2,929 FHLB of Des Moines (1). $ 1,000 $ 1,000 $ 1,118 (2) $ 1,298 (2)
-------- (1)Represents funding agreements issued to the applicable FHLBank in exchange for cash and for which such FHLBank has been granted a lien on certain assets, some of which are in the custody of such FHLBank, including residential mortgage-backed securities ("RMBS"), to collateralize obligations under advances evidenced by funding agreements. The Company is permitted to withdraw any portion of the collateral in the custody of such FHLBank as long as there is no event of default and the remaining qualified collateral is sufficient to satisfy the collateral maintenance level. Upon any event of default by the Company, such FHLBank's recovery on the collateral is limited to the amount of the Company's liability to such FHLBank. (2)Advances are collateralized by mortgage-backed securities. The amount of collateral presented is at estimated fair value. (3)Represents funding agreements issued to certain SPEs that have issued debt securities for which payment of interest and principal is secured by such funding agreements, and such debt securities are also guaranteed as to payment of interest and principal by Farmer Mac. The obligations under these funding agreements are secured by a pledge of certain eligible agricultural real estate mortgage loans and may, under certain circumstances, be secured by other qualified collateral. The amount of collateral presented is at carrying value. 43 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 4. Insurance (continued) Liabilities for Unpaid Claims and Claim Expenses Information regarding the liabilities for unpaid claims and claim expenses relating to, group accident and non-medical health policies and contracts, which are reported in future policy benefits and other policy-related balances, was as follows:
Years Ended December 31, -------------------------- 2013 2012 2011 -------- -------- -------- (In millions) Balance at January 1,........... $ 6,826 $ 6,622 $ 6,539 Less: Reinsurance recoverables. 301 324 448 -------- -------- -------- Net balance at January 1,....... 6,525 6,298 6,091 -------- -------- -------- Incurred related to: Current year................... 4,762 4,320 3,856 Prior years (1)................ (12) (42) (79) -------- -------- -------- Total incurred............... 4,750 4,278 3,777 -------- -------- -------- Paid related to: Current year................... (3,035) (2,626) (2,282) Prior years.................... (1,508) (1,425) (1,288) -------- -------- -------- Total paid................... (4,543) (4,051) (3,570) -------- -------- -------- Net balance at December 31,..... 6,732 6,525 6,298 Add: Reinsurance recoverables.. 290 301 324 -------- -------- -------- Balance at December 31,......... $ 7,022 $ 6,826 $ 6,622 ======== ======== ========
-------- (1)During 2013, 2012 and 2011, as a result of changes in estimates of insured events in the respective prior year, claims and claim adjustment expenses associated with prior years decreased due to a reduction in prior year dental and accidental death and dismemberment claims and improved loss ratio for non-medical health claim liabilities. Separate Accounts Separate account assets and liabilities include two categories of account types: pass-through separate accounts totaling $83.1 billion and $71.7 billion at December 31, 2013 and 2012, respectively, for which the policyholder assumes all investment risk, and separate accounts for which the Company contractually guarantees either a minimum return or account value to the policyholder which totaled $51.7 billion and $49.3 billion at December 31, 2013 and 2012, respectively. The latter category consisted primarily of funding agreements and participating close-out contracts. The average interest rate credited on these contracts was 2.23% and 2.80% at December 31, 2013 and 2012, respectively. For the years ended December 31, 2013, 2012 and 2011, there were no investment gains (losses) on transfers of assets from the general account to the separate accounts. 44 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 5. Deferred Policy Acquisition Costs, Value of Business Acquired and Other Policy-Related Intangibles See Note 1 for a description of capitalized acquisition costs. Nonparticipating and Non-Dividend-Paying Traditional Contracts The Company amortizes DAC and VOBA related to these contracts (term insurance, nonparticipating whole life insurance, traditional group life insurance, and non-medical health insurance) over the appropriate premium paying period in proportion to the historic actual and expected future gross premiums that were set at contract issue. The expected premiums are based upon the premium requirement of each policy and assumptions for mortality, morbidity, persistency and investment returns at policy issuance, or policy acquisition (as it relates to VOBA), include provisions for adverse deviation, and are consistent with the assumptions used to calculate future policyholder benefit liabilities. These assumptions are not revised after policy issuance or acquisition unless the DAC or VOBA balance is deemed to be unrecoverable from future expected profits. Absent a premium deficiency, variability in amortization after policy issuance or acquisition is caused only by variability in premium volumes. Participating, Dividend-Paying Traditional Contracts The Company amortizes DAC and VOBA related to these contracts over the estimated lives of the contracts in proportion to actual and expected future gross margins. The amortization includes interest based on rates in effect at inception or acquisition of the contracts. The future gross margins are dependent principally on investment returns, policyholder dividend scales, mortality, persistency, expenses to administer the business, creditworthiness of reinsurance counterparties and certain economic variables, such as inflation. For participating contracts within the closed block (dividend-paying traditional contracts) future gross margins are also dependent upon changes in the policyholder dividend obligation. See Note 7. Of these factors, the Company anticipates that investment returns, expenses, persistency and other factor changes, as well as policyholder dividend scales are reasonably likely to impact significantly the rate of DAC and VOBA amortization. Each reporting period, the Company updates the estimated gross margins with the actual gross margins for that period. When the actual gross margins change from previously estimated gross margins, the cumulative DAC and VOBA amortization is re-estimated and adjusted by a cumulative charge or credit to current operations. When actual gross margins exceed those previously estimated, the DAC and VOBA amortization will increase, resulting in a current period charge to earnings. The opposite result occurs when the actual gross margins are below the previously estimated gross margins. Each reporting period, the Company also updates the actual amount of business in-force, which impacts expected future gross margins. When expected future gross margins are below those previously estimated, the DAC and VOBA amortization will increase, resulting in a current period charge to earnings. The opposite result occurs when the expected future gross margins are above the previously estimated expected future gross margins. Each period, the Company also reviews the estimated gross margins for each block of business to determine the recoverability of DAC and VOBA balances. Fixed and Variable Universal Life Contracts and Fixed and Variable Deferred Annuity Contracts The Company amortizes DAC and VOBA related to these contracts over the estimated lives of the contracts in proportion to actual and expected future gross profits. The amortization includes interest based on rates in effect at inception or acquisition of the contracts. The amount of future gross profits is dependent principally upon returns in excess of the amounts credited to policyholders, mortality, persistency, interest crediting rates, expenses to administer the business, creditworthiness of reinsurance counterparties, the effect of any hedges used 45 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 5. Deferred Policy Acquisition Costs, Value of Business Acquired and Other Policy-Related Intangibles (continued) and certain economic variables, such as inflation. Of these factors, the Company anticipates that investment returns, expenses and persistency are reasonably likely to impact significantly the rate of DAC and VOBA amortization. Each reporting period, the Company updates the estimated gross profits with the actual gross profits for that period. When the actual gross profits change from previously estimated gross profits, the cumulative DAC and VOBA amortization is re-estimated and adjusted by a cumulative charge or credit to current operations. When actual gross profits exceed those previously estimated, the DAC and VOBA amortization will increase, resulting in a current period charge to earnings. The opposite result occurs when the actual gross profits are below the previously estimated gross profits. Each reporting period, the Company also updates the actual amount of business remaining in-force, which impacts expected future gross profits. When expected future gross profits are below those previously estimated, the DAC and VOBA amortization will increase, resulting in a current period charge to earnings. The opposite result occurs when the expected future gross profits are above the previously estimated expected future gross profits. Each period, the Company also reviews the estimated gross profits for each block of business to determine the recoverability of DAC and VOBA balances. Factors Impacting Amortization Separate account rates of return on variable universal life contracts and variable deferred annuity contracts affect in-force account balances on such contracts each reporting period, which can result in significant fluctuations in amortization of DAC and VOBA. Returns that are higher than the Company's long-term expectation produce higher account balances, which increases the Company's future fee expectations and decreases future benefit payment expectations on minimum death and living benefit guarantees, resulting in higher expected future gross profits. The opposite result occurs when returns are lower than the Company's long-term expectation. The Company's practice to determine the impact of gross profits resulting from returns on separate accounts assumes that long-term appreciation in equity markets is not changed by short-term market fluctuations, but is only changed when sustained interim deviations are expected. The Company monitors these events and only changes the assumption when its long-term expectation changes. The Company also periodically reviews other long-term assumptions underlying the projections of estimated gross margins and profits. These assumptions primarily relate to investment returns, policyholder dividend scales, interest crediting rates, mortality, persistency and expenses to administer business. Management annually updates assumptions used in the calculation of estimated gross margins and profits which may have significantly changed. If the update of assumptions causes expected future gross margins and profits to increase, DAC and VOBA amortization will decrease, resulting in a current period increase to earnings. The opposite result occurs when the assumption update causes expected future gross margins and profits to decrease. Periodically, the Company modifies product benefits, features, rights or coverages that occur by the exchange of a contract for a new contract, or by amendment, endorsement, or rider to a contract, or by election or coverage within a contract. If such modification, referred to as an internal replacement, substantially changes the contract, the associated DAC or VOBA is written off immediately through income and any new deferrable costs associated with the replacement contract are deferred. If the modification does not substantially change the contract, the DAC or VOBA amortization on the original contract will continue and any acquisition costs associated with the related modification are expensed. 46 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 5. Deferred Policy Acquisition Costs, Value of Business Acquired and Other Policy-Related Intangibles (continued) Amortization of DAC and VOBA is attributed to net investment gains (losses) and net derivative gains (losses), and to other expenses for the amount of gross margins or profits originating from transactions other than investment gains and losses. Unrealized investment gains and losses represent the amount of DAC and VOBA that would have been amortized if such gains and losses had been recognized. Information regarding DAC and VOBA was as follows:
Years Ended December 31, -------------------------- 2013 2012 2011 -------- -------- -------- (In millions) DAC Balance at January 1,................................................. $ 5,752 $ 6,244 $ 6,640 Capitalizations....................................................... 562 632 724 Amortization related to: Net investment gains (losses) and net derivative gains (losses)..... 227 (270) (88) Other expenses...................................................... (478) (709) (777) -------- -------- -------- Total amortization................................................. (251) (979) (865) -------- -------- -------- Unrealized investment gains (losses).................................. 495 (145) (255) Other (1)............................................................. (220) -- -- -------- -------- -------- Balance at December 31,............................................... 6,338 5,752 6,244 -------- -------- -------- VOBA Balance at January 1,................................................. 80 97 115 Amortization related to: Other expenses...................................................... (10) (12) (10) -------- -------- -------- Total amortization................................................. (10) (12) (10) -------- -------- -------- Unrealized investment gains (losses).................................. 8 (5) (8) -------- -------- -------- Balance at December 31,............................................... 78 80 97 -------- -------- -------- Total DAC and VOBA Balance at December 31,............................................... $ 6,416 $ 5,832 $ 6,341 ======== ======== ========
-------- (1)The year ended December 31, 2013 includes ($220) million that was reclassified to DAC from other liabilities. The amounts reclassified relate to affiliated reinsurance agreements accounted for using the deposit method of accounting and represent the DAC amortization on the expense allowances assumed on the agreements from inception. These amounts were previously included in the calculated value of the deposit payable on these agreements and were recorded within other liabilities. 47 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 5. Deferred Policy Acquisition Costs, Value of Business Acquired and Other Policy-Related Intangibles (continued) Information regarding total DAC and VOBA by segment was as follows at:
December 31, ----------------- 2013 2012 -------- -------- (In millions) Retail............................... $ 5,990 $ 5,407 Group, Voluntary & Worksite Benefits. 333 337 Corporate Benefit Funding............ 93 88 -------- -------- Total............................... $ 6,416 $ 5,832 ======== ========
Information regarding other policy-related intangibles was as follows:
Years Ended December 31, ------------------------ 2013 2012 2011 ------ ------ ------ (In millions) Deferred Sales Inducements Balance at January 1,...... $ 180 $ 184 $ 190 Capitalization............. 15 22 29 Amortization............... (20) (26) (35) ------ ------ ------ Balance at December 31,.... $ 175 $ 180 $ 184 ====== ====== ====== VODA and VOCRA Balance at January 1,...... $ 353 $ 378 $ 400 Amortization............... (28) (25) (22) ------ ------ ------ Balance at December 31,.... $ 325 $ 353 $ 378 ====== ====== ====== Accumulated amortization... $ 132 $ 104 $ 79 ====== ====== ======
The estimated future amortization expense to be reported in other expenses for the next five years is as follows:
VOBA VODA and VOCRA ------ -------------- (In millions) 2014.......................... $ 9 $ 30 2015.......................... $ 8 $ 30 2016.......................... $ 4 $ 30 2017.......................... $ 5 $ 28 2018.......................... $ 5 $ 26
48 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 6. Reinsurance The Company enters into reinsurance agreements primarily as a purchaser of reinsurance for its various insurance products and also as a provider of reinsurance for some insurance products issued by affiliated and unaffiliated companies. The Company participates in reinsurance activities in order to limit losses, minimize exposure to significant risks and provide additional capacity for future growth. Accounting for reinsurance requires extensive use of assumptions and estimates, particularly related to the future performance of the underlying business and the potential impact of counterparty credit risks. The Company periodically reviews actual and anticipated experience compared to the aforementioned assumptions used to establish assets and liabilities relating to ceded and assumed reinsurance and evaluates the financial strength of counterparties to its reinsurance agreements using criteria similar to that evaluated in the security impairment process discussed in Note 8. Retail For its individual life insurance products, the Company has historically reinsured the mortality risk primarily on an excess of retention basis or on a quota share basis. The Company currently reinsures 90% of the mortality risk in excess of $2 million for most products and reinsures up to 90% of the mortality risk for certain other products. In addition to reinsuring mortality risk as described above, the Company reinsures other risks, as well as specific coverages. Placement of reinsurance is done primarily on an automatic basis and also on a facultative basis for risks with specified characteristics. On a case by case basis, the Company may retain up to $20 million per life and reinsure 100% of amounts in excess of the amount the Company retains. The Company evaluates its reinsurance programs routinely and may increase or decrease its retention at any time. The Company's Retail Annuities business assumes 90% of the fixed annuities issued by several affiliates. The Company also reinsures 100% of the living and death benefit guarantees issued in connection with its variable annuities issued since 2004 to an affiliated reinsurer and certain portions of the living and death benefit guarantees issued in connection with its variable annuities issued prior to 2004 to affiliated and unaffiliated reinsurers. Under these reinsurance agreements, the Company pays a reinsurance premium generally based on fees associated with the guarantees collected from policyholders, and receives reimbursement for benefits paid or accrued in excess of account values, subject to certain limitations. The value of the embedded derivatives on the ceded risk is determined using a methodology consistent with the guarantees directly written by the Company with the exception of the input for nonperformance risk that reflects the credit of the reinsurer. Group, Voluntary & Worksite Benefits For policies within the Group, Voluntary & Worksite Benefits segment, the Company generally retains most of the risk and only cedes particular risk on certain client arrangements. The majority of the Company's reinsurance activity with this segment relates to client agreements for employer sponsored captive programs, risk-sharing agreements and multinational pooling. Corporate Benefit Funding The Company's Corporate Benefit Funding segment has periodically engaged in reinsurance activities, on an opportunistic basis. The impact of these activities on the financial results of this segment has not been significant and there were no additional transactions during the periods presented. 49 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 6. Reinsurance (continued) Catastrophe Coverage The Company has exposure to catastrophes which could contribute to significant fluctuations in the Company's results of operations. The Company uses excess of retention and quota share reinsurance agreements to provide greater diversification of risk and minimize exposure to larger risks. The Company reinsures its business through a diversified group of well-capitalized reinsurers. The Company analyzes recent trends in arbitration and litigation outcomes in disputes, if any, with its reinsurers. The Company monitors ratings and evaluates the financial strength of its reinsurers by analyzing their financial statements. In addition, the reinsurance recoverable balance due from each reinsurer is evaluated as part of the overall monitoring process. Recoverability of reinsurance recoverable balances is evaluated based on these analyses. The Company generally secures large reinsurance recoverable balances with various forms of collateral, including secured trusts, funds withheld accounts and irrevocable letters of credit. These reinsurance recoverable balances are stated net of allowances for uncollectible reinsurance, which at December 31, 2013 and 2012, were not significant. The Company has secured certain reinsurance recoverable balances with various forms of collateral, including secured trusts, funds withheld accounts and irrevocable letters of credit. The Company had $2.4 billion of unsecured reinsurance recoverable balances at both December 31, 2013 and 2012. At December 31, 2013, the Company had $5.4 billion of net unaffiliated ceded reinsurance recoverables. Of this total, $4.4 billion, or 82%, were with the Company's five largest unaffiliated ceded reinsurers, including $1.8 billion of net unaffiliated ceded reinsurance recoverables which were unsecured. At December 31, 2012, the Company had $5.4 billion of net unaffiliated ceded reinsurance recoverables. Of this total, $4.4 billion, or 82%, were with the Company's five largest unaffiliated ceded reinsurers, including $1.8 billion of net unaffiliated ceded reinsurance recoverables which were unsecured. The Company has reinsured with an unaffiliated third-party reinsurer, 59.25% of the closed block through a modified coinsurance agreement. The Company accounts for this agreement under the deposit method of accounting. The Company, having the right of offset, has offset the modified coinsurance deposit with the deposit recoverable. 50 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 6. Reinsurance (continued) The amounts in the consolidated statements of operations include the impact of reinsurance. Information regarding the significant effects of reinsurance was as follows:
Years Ended December 31, ----------------------------- 2013 2012 2011 --------- --------- --------- (In millions) Premiums Direct premiums............................................... $ 20,290 $ 19,821 $ 18,435 Reinsurance assumed........................................... 1,469 1,350 1,240 Reinsurance ceded............................................. (1,284) (1,291) (1,387) --------- --------- --------- Net premiums................................................ $ 20,475 $ 19,880 $ 18,288 ========= ========= ========= Universal life and investment-type product policy fees Direct universal life and investment-type product policy fees. $ 2,913 $ 2,763 $ 2,686 Reinsurance assumed........................................... 41 39 38 Reinsurance ceded............................................. (591) (563) (522) --------- --------- --------- Net universal life and investment-type product policy fees.. $ 2,363 $ 2,239 $ 2,202 ========= ========= ========= Other revenues Direct other revenues......................................... $ 970 $ 887 $ 836 Reinsurance assumed........................................... (2) (6) (6) Reinsurance ceded............................................. 731 849 978 --------- --------- --------- Net other revenues.......................................... $ 1,699 $ 1,730 $ 1,808 ========= ========= ========= Policyholder benefits and claims Direct policyholder benefits and claims....................... $ 23,305 $ 22,677 $ 21,100 Reinsurance assumed........................................... 1,225 1,208 1,069 Reinsurance ceded............................................. (1,498) (1,616) (1,488) --------- --------- --------- Net policyholder benefits and claims........................ $ 23,032 $ 22,269 $ 20,681 ========= ========= ========= Interest credited to policyholder account balances Direct interest credited to policyholder account balances..... $ 2,322 $ 2,455 $ 2,434 Reinsurance assumed........................................... 35 33 32 Reinsurance ceded............................................. (104) (98) (94) --------- --------- --------- Net interest credited to policyholder account balances...... $ 2,253 $ 2,390 $ 2,372 ========= ========= ========= Other expenses Direct other expenses......................................... $ 5,028 $ 5,328 $ 5,280 Reinsurance assumed........................................... 427 479 458 Reinsurance ceded............................................. 533 587 733 --------- --------- --------- Net other expenses.......................................... $ 5,988 $ 6,394 $ 6,471 ========= ========= =========
51 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 6. Reinsurance (continued) The amounts in the consolidated balance sheets include the impact of reinsurance. Information regarding the significant effects of reinsurance was as follows at:
December 31, --------------------------------------------------------------------------------- 2013 2012 ---------------------------------------- ---------------------------------------- Total Total Balance Balance Direct Assumed Ceded Sheet Direct Assumed Ceded Sheet ---------- -------- --------- ---------- ---------- -------- --------- ---------- (In millions) Assets Premiums, reinsurance and other receivables...................... $ 1,700 $ 527 $ 21,410 $ 23,637 $ 1,613 $ 480 $ 22,628 $ 24,721 Deferred policy acquisition costs and value of business acquired... 6,567 330 (481) 6,416 5,685 460 (313) 5,832 ---------- -------- --------- ---------- ---------- -------- --------- ---------- Total assets.................... $ 8,267 $ 857 $ 20,929 $ 30,053 $ 7,298 $ 940 $ 22,315 $ 30,553 ========== ======== ========= ========== ========== ======== ========= ========== Liabilities Future policy benefits............ $ 110,072 $ 1,891 $ -- $ 111,963 $ 112,264 $ 1,722 $ -- $ 113,986 Policyholder account balances..... 92,246 252 -- 92,498 94,454 262 -- 94,716 Other policy-related balances..... 5,416 294 (39) 5,671 5,401 291 (29) 5,663 Other liabilities................. 8,690 7,046 16,444 32,180 9,544 7,327 17,070 33,941 ---------- -------- --------- ---------- ---------- -------- --------- ---------- Total liabilities............... $ 216,424 $ 9,483 $ 16,405 $ 242,312 $ 221,663 $ 9,602 $ 17,041 $ 248,306 ========== ======== ========= ========== ========== ======== ========= ==========
Reinsurance agreements that do not expose the Company to a reasonable possibility of a significant loss from insurance risk are recorded using the deposit method of accounting. The deposit assets on reinsurance were $13.8 billion and $13.9 billion at December 31, 2013 and 2012, respectively. The deposit liabilities on reinsurance were $6.5 billion and $6.9 billion at December 31, 2013 and 2012, respectively. Related Party Reinsurance Transactions The Company has reinsurance agreements with certain of MetLife, Inc.'s subsidiaries, including Exeter Reassurance Company, Ltd. ("Exeter"), First MetLife Investors Insurance Company, MetLife Insurance Company of Connecticut ("MICC"), MetLife Investors USA Insurance Company ("MLI-USA"), MetLife Investors Insurance Company ("MLIIC"), MetLife Reinsurance Company of Charleston ("MRC"), MetLife Reinsurance Company of Vermont and Metropolitan Tower Life Insurance Company, all of which are related parties. 52 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 6. Reinsurance (continued) Information regarding the significant effects of affiliated reinsurance included in the consolidated statements of operations was as follows:
Years Ended December 31, ------------------------ 2013 2012 2011 ------ -------- -------- (In millions) Premiums Reinsurance assumed.......................................... $ 451 $ 319 $ 169 Reinsurance ceded............................................ (45) (54) (51) ------ -------- -------- Net premiums............................................... $ 406 $ 265 $ 118 ====== ======== ======== Universal life and investment-type product policy fees Reinsurance assumed.......................................... $ 40 $ 39 $ 38 Reinsurance ceded............................................ (221) (216) (170) ------ -------- -------- Net universal life and investment-type product policy fees. $(181) $ (177) $ (132) ====== ======== ======== Other revenues Reinsurance assumed.......................................... $ (2) $ (6) $ (7) Reinsurance ceded............................................ 675 790 916 ------ -------- -------- Net other revenues......................................... $ 673 $ 784 $ 909 ====== ======== ======== Policyholder benefits and claims Reinsurance assumed.......................................... $ 402 $ 334 $ 175 Reinsurance ceded............................................ (144) (177) (121) ------ -------- -------- Net policyholder benefits and claims....................... $ 258 $ 157 $ 54 ====== ======== ======== Interest credited to policyholder account balances Reinsurance assumed.......................................... $ 31 $ 30 $ 28 Reinsurance ceded............................................ (102) (98) (94) ------ -------- -------- Net interest credited to policyholder account balances..... $ (71) $ (68) $ (66) ====== ======== ======== Other expenses Reinsurance assumed.......................................... $ 326 $ 357 $ 352 Reinsurance ceded............................................ 653 789 914 ------ -------- -------- Net other expenses......................................... $ 979 $ 1,146 $ 1,266 ====== ======== ========
53 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 6. Reinsurance (continued) Information regarding the significant effects of affiliated reinsurance included in the consolidated balance sheets was as follows at:
December 31, ------------------------------------- 2013 2012 ------------------ ------------------ Assumed Ceded Assumed Ceded -------- --------- -------- --------- (In millions) Assets Premiums, reinsurance and other receivables (1)......... $ 109 $ 15,748 $ 85 $ 16,925 Deferred policy acquisition costs and value of business acquired.............................................. 309 (273) 435 (266) -------- --------- -------- --------- Total assets........................................... $ 418 $ 15,475 $ 520 $ 16,659 ======== ========= ======== ========= Liabilities Future policy benefits.................................. $ 761 $ -- $ 567 $ -- Policyholder account balances........................... 239 -- 251 -- Other policy-related balances........................... 67 (39) 57 (29) Other liabilities (1)................................... 6,606 14,044 6,906 14,652 -------- --------- -------- --------- Total liabilities...................................... $ 7,673 $ 14,005 $ 7,781 $ 14,623 ======== ========= ======== =========
-------- (1)Effective in June 2012, the Company recaptured 10% of the 40.75% of the closed block liabilities that were ceded to MRC on a coinsurance with funds withheld basis. In connection with this partial recapture, the Company recognized a decrease of $3.9 billion in the deposit receivable included within premiums, reinsurance and other receivables, as well as an offsetting decrease of $3.9 billion in the funds withheld included within other liabilities at December 31, 2012. MLIC ceded two blocks of business to two affiliates on a 75% coinsurance with funds withheld basis. Certain contractual features of these agreements qualify as embedded derivatives, which are separately accounted for at estimated fair value on the Company's consolidated balance sheets. The embedded derivatives related to the funds withheld associated with these reinsurance agreements are included within other liabilities and increased/(decreased) the funds withheld balance by ($11) million and $29 million at December 31, 2013 and 2012, respectively. Net derivative gains (losses) associated with these embedded derivatives were $40 million, ($9) million and ($29) million for the years ended December 31, 2013, 2012 and 2011, respectively. The Company ceded risks to an affiliate related to guaranteed minimum benefit guarantees written directly by the Company. These ceded reinsurance agreements contain embedded derivatives and changes in their fair value are included within net derivative gains (losses). The embedded derivatives associated with the cessions are included within premiums, reinsurance and other receivables and were ($62) million and $1.4 billion at December 31, 2013 and 2012, respectively. Net derivative gains (losses) associated with the embedded derivatives were ($1.7) billion, $14 million and $727 million for the years ended December 31, 2013, 2012 and 2011, respectively. Certain contractual features of the closed block agreement with MRC create an embedded derivative, which is separately accounted for at estimated fair value on the Company's consolidated balance sheets. The embedded derivative related to the funds withheld associated with this reinsurance agreement was included within other liabilities and increased the funds withheld balance by $709 million and $1.4 billion at December 31, 2013 and 54 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 6. Reinsurance (continued) 2012, respectively. Net derivative gains (losses) associated with the embedded derivative were $664 million, $135 million and ($811) million for the years ended December 31, 2013, 2012 and 2011, respectively. The Company has secured certain reinsurance recoverable balances with various forms of collateral, including secured trusts, funds withheld accounts and irrevocable letters of credit. The Company had $1.2 billion and $2.1 billion of unsecured affiliated reinsurance recoverable balances at December 31, 2013 and 2012, respectively. Affiliated reinsurance agreements that do not expose the Company to a reasonable possibility of a significant loss from insurance risk are recorded using the deposit method of accounting. The deposit assets on affiliated reinsurance were $11.8 billion at both December 31, 2013 and 2012. The deposit liabilities on affiliated reinsurance were $6.5 billion and $6.8 billion at December 31, 2013 and 2012, respectively. 7. Closed Block On April 7, 2000 (the "Demutualization Date"), Metropolitan Life Insurance Company converted from a mutual life insurance company to a stock life insurance company and became a wholly-owned subsidiary of MetLife, Inc. The conversion was pursuant to an order by the New York Superintendent of Insurance approving Metropolitan Life Insurance Company's plan of reorganization, as amended (the "Plan"). On the Demutualization Date, Metropolitan Life Insurance Company established a closed block for the benefit of holders of certain individual life insurance policies of Metropolitan Life Insurance Company. Assets have been allocated to the closed block in an amount that has been determined to produce cash flows which, together with anticipated revenues from the policies included in the closed block, are reasonably expected to be sufficient to support obligations and liabilities relating to these policies, including, but not limited to, provisions for the payment of claims and certain expenses and taxes, and to provide for the continuation of policyholder dividend scales in effect for 1999, if the experience underlying such dividend scales continues, and for appropriate adjustments in such scales if the experience changes. At least annually, the Company compares actual and projected experience against the experience assumed in the then-current dividend scales. Dividend scales are adjusted periodically to give effect to changes in experience. The closed block assets, the cash flows generated by the closed block assets and the anticipated revenues from the policies in the closed block will benefit only the holders of the policies in the closed block. To the extent that, over time, cash flows from the assets allocated to the closed block and claims and other experience related to the closed block are, in the aggregate, more or less favorable than what was assumed when the closed block was established, total dividends paid to closed block policyholders in the future may be greater than or less than the total dividends that would have been paid to these policyholders if the policyholder dividend scales in effect for 1999 had been continued. Any cash flows in excess of amounts assumed will be available for distribution over time to closed block policyholders and will not be available to stockholders. If the closed block has insufficient funds to make guaranteed policy benefit payments, such payments will be made from assets outside of the closed block. The closed block will continue in effect as long as any policy in the closed block remains in-force. The expected life of the closed block is over 100 years. The Company uses the same accounting principles to account for the participating policies included in the closed block as it used prior to the Demutualization Date. However, the Company establishes a policyholder dividend obligation for earnings that will be paid to policyholders as additional dividends as described below. The excess of closed block liabilities over closed block assets at the Demutualization Date (adjusted to eliminate 55 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 7. Closed Block (continued) the impact of related amounts in AOCI) represents the estimated maximum future earnings from the closed block expected to result from operations attributed to the closed block after income taxes. Earnings of the closed block are recognized in income over the period the policies and contracts in the closed block remain in-force. Management believes that over time the actual cumulative earnings of the closed block will approximately equal the expected cumulative earnings due to the effect of dividend changes. If, over the period the closed block remains in existence, the actual cumulative earnings of the closed block are greater than the expected cumulative earnings of the closed block, the Company will pay the excess of the actual cumulative earnings of the closed block over the expected cumulative earnings to closed block policyholders as additional policyholder dividends unless offset by future unfavorable experience of the closed block and, accordingly, will recognize only the expected cumulative earnings in income with the excess recorded as a policyholder dividend obligation. If over such period, the actual cumulative earnings of the closed block are less than the expected cumulative earnings of the closed block, the Company will recognize only the actual earnings in income. However, the Company may change policyholder dividend scales in the future, which would be intended to increase future actual earnings until the actual cumulative earnings equal the expected cumulative earnings. Experience within the closed block, in particular mortality and investment yields, as well as realized and unrealized gains and losses, directly impact the policyholder dividend obligation. Amortization of the closed block DAC, which resides outside of the closed block, is based upon cumulative actual and expected earnings within the closed block. Accordingly, the Company's net income continues to be sensitive to the actual performance of the closed block. Closed block assets, liabilities, revenues and expenses are combined on a line-by-line basis with the assets, liabilities, revenues and expenses outside the closed block based on the nature of the particular item. 56 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 7. Closed Block (continued) Information regarding the closed block liabilities and assets designated to the closed block was as follows at:
December 31, ------------------- 2013 2012 --------- --------- (In millions) Closed Block Liabilities Future policy benefits............................................................ $ 42,076 $ 42,586 Other policy-related balances..................................................... 298 298 Policyholder dividends payable.................................................... 456 466 Policyholder dividend obligation.................................................. 1,771 3,828 Current income tax payable........................................................ 18 -- Other liabilities................................................................. 582 602 --------- --------- Total closed block liabilities................................................. 45,201 47,780 --------- --------- Assets Designated to the Closed Block Investments: Fixed maturity securities available-for-sale, at estimated fair value............ 28,374 30,546 Equity securities available-for-sale, at estimated fair value.................... 86 41 Mortgage loans................................................................... 6,155 6,192 Policy loans..................................................................... 4,669 4,670 Real estate and real estate joint ventures....................................... 492 459 Other invested assets............................................................ 814 953 --------- --------- Total investments.............................................................. 40,590 42,861 Cash and cash equivalents......................................................... 238 381 Accrued investment income......................................................... 477 481 Premiums, reinsurance and other receivables....................................... 98 107 Current income tax recoverable.................................................... -- 2 Deferred income tax assets........................................................ 293 319 --------- --------- Total assets designated to the closed block.................................... 41,696 44,151 --------- --------- Excess of closed block liabilities over assets designated to the closed block..... 3,505 3,629 --------- --------- Amounts included in AOCI: Unrealized investment gains (losses), net of income tax.......................... 1,502 2,891 Unrealized gains (losses) on derivatives, net of income tax...................... (3) 9 Allocated to policyholder dividend obligation, net of income tax................. (1,151) (2,488) --------- --------- Total amounts included in AOCI................................................. 348 412 --------- --------- Maximum future earnings to be recognized from closed block assets and liabilities. $ 3,853 $ 4,041 ========= =========
57 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 7. Closed Block (continued) Information regarding the closed block policyholder dividend obligation was as follows:
Years Ended December 31, ---------------------------------- 2013 2012 2011 ------------ ---------- ---------- (In millions) Balance at January 1,........................................................... $ 3,828 $ 2,919 $ 876 Change in unrealized investment and derivative gains (losses)................... (2,057) 909 2,043 ------------ ---------- ---------- Balance at December 31,......................................................... $ 1,771 $ 3,828 $ 2,919 ============ ========== ==========
Information regarding the closed block revenues and expenses was as follows:
Years Ended December 31, -------------------------- 2013 2012 2011 -------- -------- -------- (In millions) Revenues Premiums................................................................. $ 1,987 $ 2,139 $ 2,306 Net investment income.................................................... 2,130 2,188 2,231 Net investment gains (losses)............................................ 25 61 32 Net derivative gains (losses)............................................ (6) (12) 8 -------- -------- -------- Total revenues........................................................ 4,136 4,376 4,577 -------- -------- -------- Expenses Policyholder benefits and claims......................................... 2,702 2,783 2,991 Policyholder dividends................................................... 979 1,072 1,137 Other expenses........................................................... 165 179 193 -------- -------- -------- Total expenses........................................................ 3,846 4,034 4,321 -------- -------- -------- Revenues, net of expenses before provision for income tax expense (benefit).............................................................. 290 342 256 Provision for income tax expense (benefit)............................... 101 120 89 -------- -------- -------- Revenues, net of expenses and provision for income tax expense (benefit) from continuing operations............................................. 189 222 167 Revenues, net of expenses and provision for income tax expense (benefit) from discontinued operations........................................... -- 10 1 -------- -------- -------- Revenues, net of expenses and provision for income tax expense (benefit).............................................................. $ 189 $ 232 $ 168 ======== ======== ========
Metropolitan Life Insurance Company charges the closed block with federal income taxes, state and local premium taxes and other additive state or local taxes, as well as investment management expenses relating to the closed block as provided in the Plan. Metropolitan Life Insurance Company also charges the closed block for expenses of maintaining the policies included in the closed block. 58 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 8. Investments See Note 10 for information about the fair value hierarchy for investments and the related valuation methodologies. Investment Risks and Uncertainties Investments are exposed to the following primary sources of risk: credit, interest rate, liquidity, market valuation, currency and real estate risk. The financial statement risks, stemming from such investment risks, are those associated with the determination of estimated fair values, the diminished ability to sell certain investments in times of strained market conditions, the recognition of impairments, the recognition of income on certain investments and the potential consolidation of VIEs. The use of different methodologies, assumptions and inputs relating to these financial statement risks may have a material effect on the amounts presented within the consolidated financial statements. The determination of valuation allowances and impairments is highly subjective and is based upon periodic evaluations and assessments of known and inherent risks associated with the respective asset class. Such evaluations and assessments are revised as conditions change and new information becomes available. The recognition of income on certain investments (e.g. structured securities, including mortgage-backed securities, asset-backed securities ("ABS"), certain structured investment transactions and trading and FVO securities) is dependent upon certain factors such as prepayments and defaults, and changes in such factors could result in changes in amounts to be earned. 59 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 8. Investments (continued) Fixed Maturity and Equity Securities AFS Fixed Maturity and Equity Securities AFS by Sector The following table presents the fixed maturity and equity securities AFS by sector. Redeemable preferred stock is reported within U.S. corporate and foreign corporate fixed maturity securities and non-redeemable preferred stock is reported within equity securities. Included within fixed maturity securities are structured securities including RMBS, commercial mortgage-backed securities ("CMBS") and ABS.
December 31, 2013 December 31, 2012 --------------------------------------------- --------------------------------------------- Gross Unrealized Gross Unrealized Cost or ------------------------- Estimated Cost or ------------------------- Estimated Amortized Temporary OTTI Fair Amortized Temporary OTTI Fair Cost Gains Losses Losses Value Cost Gains Losses Losses Value --------- -------- --------- ------ --------- --------- -------- --------- ------ --------- (In millions) Fixed maturity securities U.S. corporate............ $ 60,244 $ 4,678 $ 693 $ -- $ 64,229 $ 59,587 $ 7,717 $ 304 $ -- $ 67,000 U.S. Treasury and agency.. 29,508 1,730 694 -- 30,544 28,252 4,408 9 -- 32,651 Foreign corporate (1)..... 27,082 1,959 285 -- 28,756 27,231 3,128 126 (1) 30,234 RMBS...................... 24,119 1,109 368 150 24,710 23,792 1,716 226 257 25,025 CMBS...................... 8,203 262 89 -- 8,376 9,264 559 37 -- 9,786 ABS (1)................... 7,789 151 117 (1) 7,824 8,025 205 105 -- 8,125 State and political subdivision.............. 5,386 467 76 -- 5,777 5,554 1,184 18 -- 6,720 Foreign government........ 3,040 597 107 -- 3,530 3,052 1,086 3 -- 4,135 -------- -------- ------- ---- --------- --------- -------- ----- ------ --------- Total fixed maturity securities.............. $165,371 $ 10,953 $ 2,429 $149 $ 173,746 $ 164,757 $ 20,003 $ 828 $ 256 $ 183,676 ======== ======== ======= ==== ========= ========= ======== ===== ====== ========= Equity securities Common stock.............. $ 1,070 $ 97 $ 3 $ -- $ 1,164 $ 1,013 $ 33 $ 5 $ -- $ 1,041 Non-redeemable preferred stock.................... 743 62 77 -- 728 528 41 111 -- 458 -------- -------- ------- ---- --------- --------- -------- ----- ------ --------- Total equity securities.. $ 1,813 $ 159 $ 80 $ -- $ 1,892 $ 1,541 $ 74 $ 116 $ -- $ 1,499 ======== ======== ======= ==== ========= ========= ======== ===== ====== =========
-------- (1)The noncredit loss component of OTTI losses was in an unrealized gain position of $1 million for ABS at December 31, 2013, and $1 million for foreign corporate securities at December 31, 2012, due to increases in estimated fair value subsequent to initial recognition of noncredit losses on such securities. See also "--Net Unrealized Investment Gains (Losses)." The Company held non-income producing fixed maturity securities with an estimated fair value of $38 million and $41 million with unrealized gains (losses) of $12 million and $6 million at December 31, 2013 and 2012, respectively. Methodology for Amortization of Premium and Accretion of Discount on Structured Securities Amortization of premium and accretion of discount on structured securities considers the estimated timing and amount of prepayments of the underlying loans. Actual prepayment experience is periodically reviewed and effective yields are recalculated when differences arise between the originally anticipated and the actual 60 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 8. Investments (continued) prepayments received and currently anticipated. Prepayment assumptions for single class and multi-class mortgage-backed and ABS are estimated using inputs obtained from third-party specialists and based on management's knowledge of the current market. For credit-sensitive mortgage-backed and ABS and certain prepayment-sensitive securities, the effective yield is recalculated on a prospective basis. For all other mortgage-backed and ABS, the effective yield is recalculated on a retrospective basis. Maturities of Fixed Maturity Securities The amortized cost and estimated fair value of fixed maturity securities, by contractual maturity date, were as follows at:
December 31, ------------------------------------------- 2013 2012 --------------------- --------------------- Estimated Estimated Amortized Fair Amortized Fair Cost Value Cost Value ---------- ---------- ---------- ---------- (In millions) Due in one year or less........................... $ 6,411 $ 6,516 $ 12,671 $ 12,796 Due after one year through five years............. 34,696 36,556 30,187 32,160 Due after five years through ten years............ 35,725 38,347 34,983 40,009 Due after ten years............................... 48,428 51,417 45,835 55,775 ---------- ---------- ---------- ---------- Subtotal........................................ 125,260 132,836 123,676 140,740 Structured securities (RMBS, CMBS and ABS)........ 40,111 40,910 41,081 42,936 ---------- ---------- ---------- ---------- Total fixed maturity securities................. $ 165,371 $ 173,746 $ 164,757 $ 183,676 ========== ========== ========== ==========
Actual maturities may differ from contractual maturities due to the exercise of call or prepayment options. Fixed maturity securities not due at a single maturity date have been presented in the year of final contractual maturity. RMBS, CMBS and ABS are shown separately, as they are not due at a single maturity. 61 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 8. Investments (continued) Continuous Gross Unrealized Losses for Fixed Maturity and Equity Securities AFS by Sector The following table presents the estimated fair value and gross unrealized losses of fixed maturity and equity securities AFS in an unrealized loss position, aggregated by sector and by length of time that the securities have been in a continuous unrealized loss position.
December 31, 2013 December 31, 2012 ----------------------------------------- ----------------------------------------- Equal to or Greater Equal to or Greater Less than 12 Months than 12 Months Less than 12 Months than 12 Months -------------------- -------------------- -------------------- -------------------- Estimated Gross Estimated Gross Estimated Gross Estimated Gross Fair Unrealized Fair Unrealized Fair Unrealized Fair Unrealized Value Losses Value Losses Value Losses Value Losses --------- ---------- --------- ---------- --------- ---------- --------- ---------- (In millions, except number of securities) Fixed maturity securities U.S. corporate................... $ 8,512 $ 426 $ 1,948 $ 267 $ 2,567 $ 58 $ 2,507 $ 246 U.S. Treasury and agency......... 10,077 687 33 7 1,576 9 -- -- Foreign corporate................ 4,217 176 952 109 758 34 1,381 91 RMBS............................. 8,194 291 1,675 227 639 18 3,098 465 CMBS............................. 2,022 74 221 15 727 5 308 32 ABS.............................. 1,701 28 530 88 1,246 22 697 83 State and political subdivision..................... 737 44 92 32 92 1 103 17 Foreign government............... 763 94 54 13 106 1 27 2 --------- -------- -------- ------ -------- ---- -------- ------ Total fixed maturity securities.................... $ 36,223 $ 1,820 $ 5,505 $ 758 $ 7,711 $148 $ 8,121 $ 936 ========= ======== ======== ====== ======== ==== ======== ====== Equity securities Common stock..................... $ 37 $ 3 $ -- $ -- $ 62 $ 5 $ 1 $ -- Non-redeemable preferred stock........................... 222 41 125 36 -- -- 190 111 --------- -------- -------- ------ -------- ---- -------- ------ Total equity securities........ $ 259 $ 44 $ 125 $ 36 $ 62 $ 5 $ 191 $ 111 --------- -------- -------- ------ -------- ---- -------- ------ Total number of securities in an unrealized loss position........ 2,211 469 622 637 ========= ======== ======== ========
62 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 8. Investments (continued) Evaluation of AFS Securities for OTTI and Evaluating Temporarily Impaired AFS Securities Evaluation and Measurement Methodologies Management considers a wide range of factors about the security issuer and uses its best judgment in evaluating the cause of the decline in the estimated fair value of the security and in assessing the prospects for near-term recovery. Inherent in management's evaluation of the security are assumptions and estimates about the operations of the issuer and its future earnings potential. Considerations used in the impairment evaluation process include, but are not limited to: (i) the length of time and the extent to which the estimated fair value has been below cost or amortized cost; (ii) the potential for impairments when the issuer is experiencing significant financial difficulties; (iii) the potential for impairments in an entire industry sector or sub-sector; (iv) the potential for impairments in certain economically depressed geographic locations; (v) the potential for impairments where the issuer, series of issuers or industry has suffered a catastrophic loss or has exhausted natural resources; (vi) with respect to fixed maturity securities, whether the Company has the intent to sell or will more likely than not be required to sell a particular security before the decline in estimated fair value below amortized cost recovers; (vii) with respect to structured securities, changes in forecasted cash flows after considering the quality of underlying collateral, expected prepayment speeds, current and forecasted loss severity, consideration of the payment terms of the underlying assets backing a particular security, and the payment priority within the tranche structure of the security; and (viii) other subjective factors, including concentrations and information obtained from regulators and rating agencies. The methodology and significant inputs used to determine the amount of credit loss on fixed maturity securities are as follows: . The Company calculates the recovery value by performing a discounted cash flow analysis based on the present value of future cash flows. The discount rate is generally the effective interest rate of the security prior to impairment. . When determining collectability and the period over which value is expected to recover, the Company applies considerations utilized in its overall impairment evaluation process which incorporates information regarding the specific security, fundamentals of the industry and geographic area in which the security issuer operates, and overall macroeconomic conditions. Projected future cash flows are estimated using assumptions derived from management's best estimates of likely scenario-based outcomes after giving consideration to a variety of variables that include, but are not limited to: payment terms of the security; the likelihood that the issuer can service the interest and principal payments; the quality and amount of any credit enhancements; the security's position within the capital structure of the issuer; possible corporate restructurings or asset sales by the issuer; and changes to the rating of the security or the issuer by rating agencies. . Additional considerations are made when assessing the unique features that apply to certain structured securities including, but not limited to: the quality of underlying collateral, expected prepayment speeds, current and forecasted loss severity, consideration of the payment terms of the underlying loans or assets backing a particular security, and the payment priority within the tranche structure of the security. 63 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 8. Investments (continued) . When determining the amount of the credit loss for U.S. and foreign corporate securities, foreign government securities and state and political subdivision securities, the estimated fair value is considered the recovery value when available information does not indicate that another value is more appropriate. When information is identified that indicates a recovery value other than estimated fair value, management considers in the determination of recovery value the same considerations utilized in its overall impairment evaluation process as described above, as well as any private and public sector programs to restructure such securities. With respect to securities that have attributes of debt and equity (perpetual hybrid securities), consideration is given in the OTTI analysis as to whether there has been any deterioration in the credit of the issuer and the likelihood of recovery in value of the securities that are in a severe and extended unrealized loss position. Consideration is also given as to whether any perpetual hybrid securities, with an unrealized loss, regardless of credit rating, have deferred any dividend payments. When an OTTI loss has occurred, the OTTI loss is the entire difference between the perpetual hybrid security's cost and its estimated fair value with a corresponding charge to earnings. The cost or amortized cost of fixed maturity and equity securities is adjusted for OTTI in the period in which the determination is made. The Company does not change the revised cost basis for subsequent recoveries in value. In periods subsequent to the recognition of OTTI on a fixed maturity security, the Company accounts for the impaired security as if it had been purchased on the measurement date of the impairment. Accordingly, the discount (or reduced premium) based on the new cost basis is accreted over the remaining term of the fixed maturity security in a prospective manner based on the amount and timing of estimated future cash flows. Current Period Evaluation Based on the Company's current evaluation of its AFS securities in an unrealized loss position in accordance with its impairment policy, and the Company's current intentions and assessments (as applicable to the type of security) about holding, selling and any requirements to sell these securities, the Company has concluded that these securities are not other-than-temporarily impaired at December 31, 2013. Future OTTI will depend primarily on economic fundamentals, issuer performance (including changes in the present value of future cash flows expected to be collected), and changes in credit ratings, collateral valuation, interest rates and credit spreads. If economic fundamentals deteriorate or if there are adverse changes in the above factors, OTTI may be incurred in upcoming periods. Gross unrealized losses on fixed maturity securities increased $1.5 billion during the year ended December 31, 2013 from $1.1 billion to $2.6 billion. The increase in gross unrealized losses for the year ended December 31, 2013, was primarily attributable to an increase in interest rates, partially offset by narrowing credit spreads. At December 31, 2013, $163 million of the total $2.6 billion of gross unrealized losses were from 60 fixed maturity securities with an unrealized loss position of 20% or more of amortized cost for six months or greater. 64 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 8. Investments (continued) Investment Grade Fixed Maturity Securities Of the $163 million of gross unrealized losses on fixed maturity securities with an unrealized loss of 20% or more of amortized cost for six months or greater, $76 million, or 47%, are related to gross unrealized losses on 39 investment grade fixed maturity securities. Unrealized losses on investment grade fixed maturity securities are principally related to widening credit spreads and, with respect to fixed-rate fixed maturity securities, rising interest rates since purchase. Below Investment Grade Fixed Maturity Securities Of the $163 million of gross unrealized losses on fixed maturity securities with an unrealized loss of 20% or more of amortized cost for six months or greater, $87 million, or 53%, are related to gross unrealized losses on 21 below investment grade fixed maturity securities. Unrealized losses on below investment grade fixed maturity securities are principally related to non-agency RMBS (primarily alternative residential mortgage loans) and ABS (primarily foreign ABS) and are the result of significantly wider credit spreads resulting from higher risk premiums since purchase, largely due to economic and market uncertainties including concerns over unemployment levels and valuations of residential real estate supporting non-agency RMBS. Management evaluates non-agency RMBS and ABS based on actual and projected cash flows after considering the quality of underlying collateral, expected prepayment speeds, current and forecasted loss severity, consideration of the payment terms of the underlying assets backing a particular security, and the payment priority within the tranche structure of the security. Equity Securities Gross unrealized losses on equity securities decreased $36 million during the year ended December 31, 2013 from $116 million to $80 million. Of the $80 million, $33 million were from ten equity securities with gross unrealized losses of 20% or more of cost for 12 months or greater, all of which were financial services industry investment grade non-redeemable preferred stock, of which 68% were rated A or better. 65 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 8. Investments (continued) Mortgage Loans Mortgage Loans by Portfolio Segment Mortgage loans are summarized as follows at:
December 31, ------------------------------------------ 2013 2012 -------------------- -------------------- Carrying % of Carrying % of Value Total Value Total ------------- ------ ------------- ------ (In millions) (In millions) Mortgage loans held-for-investment: Commercial......................................... $ 33,072 71.9 % $ 33,369 74.7 % Agricultural....................................... 11,025 24.0 11,487 25.7 Residential........................................ 1,858 4.0 105 0.3 --------- ------ --------- ------ Subtotal (1)..................................... 45,955 99.9 44,961 100.7 Valuation allowances............................... (272) (0.6) (304) (0.7) --------- ------ --------- ------ Subtotal mortgage loans held-for-investment, net. 45,683 99.3 44,657 100.0 Residential -- FVO................................. 338 0.7 -- -- --------- ------ --------- ------ Total mortgage loans held-for-investment, net.... 46,021 100.0 44,657 100.0 --------- ------ --------- ------ Mortgage loans held-for-sale........................ 3 -- -- -- --------- ------ --------- ------ Total mortgage loans, net...................... $ 46,024 100.0 % $ 44,657 100.0 % ========= ====== ========= ======
-------- (1)In 2013, the Company purchased $319 million, $1 million and $1.8 billion of commercial, agricultural and residential mortgage loans, respectively. In 2012, the Company purchased $1.2 billion, $191 million and $105 million of commercial, agricultural and residential mortgage loans, respectively, of which $1.2 billion, and $191 million of commercial and agricultural mortgage loans, respectively, were purchased at estimated fair value from an affiliate, MetLife Bank, National Association ("MetLife Bank"). 66 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 8. Investments (continued) Mortgage Loans and Valuation Allowance by Portfolio Segment The carrying value prior to valuation allowance ("recorded investment") in mortgage loans held-for-investment, by portfolio segment, by method of evaluation of credit loss, and the related valuation allowances, by type of credit loss, were as follows at:
December 31, ------------------------------------------------------------------------------------------- 2013 2012 --------------------------------------------- --------------------------------------------- Commercial Agricultural Residential Total Commercial Agricultural Residential Total ---------- ------------ ----------- --------- ---------- ------------ ----------- --------- (In millions) Mortgage loans: Evaluated individually for credit losses............... $ 415 $ 96 $ 4 $ 515 $ 441 $ 181 $ -- $ 622 Evaluated collectively for credit losses............... 32,657 10,929 1,854 45,440 32,928 11,306 105 44,339 --------- --------- -------- --------- --------- --------- ------ --------- Total mortgage loans........ 33,072 11,025 1,858 45,955 33,369 11,487 105 44,961 --------- --------- -------- --------- --------- --------- ------ --------- Valuation allowances:.......... Specific credit losses....... 49 7 -- 56 84 21 -- 105 Non-specifically identified credit losses............... 164 33 19 216 172 27 -- 199 --------- --------- -------- --------- --------- --------- ------ --------- Total valuation allowances................. 213 40 19 272 256 48 -- 304 --------- --------- -------- --------- --------- --------- ------ --------- Mortgage loans, net of valuation allowance................. $ 32,859 $ 10,985 $ 1,839 $ 45,683 $ 33,113 $ 11,439 $ 105 $ 44,657 ========= ========= ======== ========= ========= ========= ====== =========
Valuation Allowance Rollforward by Portfolio Segment The changes in the valuation allowance, by portfolio segment, were as follows:
Commercial Agricultural Residential Total ---------- ------------- ----------- -------- (In millions) Balance at January 1, 2011..... $ 441 $ 81 $ -- $ 522 Provision (release)............ (111) (2) -- (113) Charge-offs, net of recoveries. (12) (4) -- (16) -------- ------- ------- -------- Balance at December 31, 2011... 318 75 -- 393 Provision (release)............ (50) 2 -- (48) Charge-offs, net of recoveries. (12) (24) -- (36) Transfers to held-for-sale..... -- (5) -- (5) -------- ------- ------- -------- Balance at December 31, 2012... 256 48 -- 304 Provision (release)............ (43) 3 19 (21) Charge-offs, net of recoveries. -- (11) -- (11) -------- ------- ------- -------- Balance at December 31, 2013... $ 213 $ 40 $ 19 $ 272 ======== ======= ======= ========
67 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 8. Investments (continued) Valuation Allowance Methodology Mortgage loans are considered to be impaired when it is probable that, based upon current information and events, the Company will be unable to collect all amounts due under the loan agreement. Specific valuation allowances are established using the same methodology for all three portfolio segments as the excess carrying value of a loan over either (i) the present value of expected future cash flows discounted at the loan's original effective interest rate, (ii) the estimated fair value of the loan's underlying collateral if the loan is in the process of foreclosure or otherwise collateral dependent, or (iii) the loan's observable market price. A common evaluation framework is used for establishing non-specific valuation allowances for all loan portfolio segments; however, a separate non-specific valuation allowance is calculated and maintained for each loan portfolio segment that is based on inputs unique to each loan portfolio segment. Non-specific valuation allowances are established for pools of loans with similar risk characteristics where a property-specific or market-specific risk has not been identified, but for which the Company expects to incur a credit loss. These evaluations are based upon several loan portfolio segment-specific factors, including the Company's experience for loan losses, defaults and loss severity, and loss expectations for loans with similar risk characteristics. These evaluations are revised as conditions change and new information becomes available. Commercial and Agricultural Mortgage Loan Portfolio Segments The Company typically uses several years of historical experience in establishing non-specific valuation allowances which captures multiple economic cycles. For evaluations of commercial mortgage loans, in addition to historical experience, management considers factors that include the impact of a rapid change to the economy, which may not be reflected in the loan portfolio, and recent loss and recovery trend experience as compared to historical loss and recovery experience. For evaluations of agricultural mortgage loans, in addition to historical experience, management considers factors that include increased stress in certain sectors, which may be evidenced by higher delinquency rates, or a change in the number of higher risk loans. On a quarterly basis, management incorporates the impact of these current market events and conditions on historical experience in determining the non-specific valuation allowance established for commercial and agricultural mortgage loans. All commercial mortgage loans are reviewed on an ongoing basis which may include an analysis of the property financial statements and rent roll, lease rollover analysis, property inspections, market analysis, estimated valuations of the underlying collateral, loan-to-value ratios, debt service coverage ratios, and tenant creditworthiness. All agricultural mortgage loans are monitored on an ongoing basis. The monitoring process focuses on higher risk loans, which include those that are classified as restructured, delinquent or in foreclosure, as well as loans with higher loan-to-value ratios and lower debt service coverage ratios. The monitoring process for agricultural mortgage loans is generally similar to the commercial mortgage loan monitoring process, with a focus on higher risk loans, including reviews on a geographic and property-type basis. Higher risk loans are reviewed individually on an ongoing basis for potential credit loss and specific valuation allowances are established using the methodology described above. Quarterly, the remaining loans are reviewed on a pool basis by aggregating groups of loans that have similar risk characteristics for potential credit loss, and non-specific valuation allowances are established as described above using inputs that are unique to each segment of the loan portfolio. For commercial mortgage loans, the primary credit quality indicator is the debt service coverage ratio, which compares a property's net operating income to amounts needed to service the principal and interest due 68 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 8. Investments (continued) under the loan. Generally, the lower the debt service coverage ratio, the higher the risk of experiencing a credit loss. The Company also reviews the loan-to-value ratio of its commercial mortgage loan portfolio. Loan-to-value ratios compare the unpaid principal balance of the loan to the estimated fair value of the underlying collateral. Generally, the higher the loan-to-value ratio, the higher the risk of experiencing a credit loss. The debt service coverage ratio and loan-to-value ratio, as well as the values utilized in calculating these ratios, are updated annually, on a rolling basis, with a portion of the loan portfolio updated each quarter. For agricultural mortgage loans, the Company's primary credit quality indicator is the loan-to-value ratio. The values utilized in calculating this ratio are developed in connection with the ongoing review of the agricultural mortgage loan portfolio and are routinely updated. Residential Mortgage Loan Portfolio Segment The Company's residential mortgage loan portfolio is comprised primarily of closed end, amortizing residential mortgage loans. For evaluations of residential mortgage loans, the key inputs of expected frequency and expected loss reflect current market conditions, with expected frequency adjusted, when appropriate, for differences from market conditions and the Company's historical experience. In contrast to the commercial and agricultural mortgage loan portfolios, residential mortgage loans are smaller-balance homogeneous loans that are collectively evaluated for impairment. Non-specific valuation allowances are established using the evaluation framework described above for pools of loans with similar risk characteristics from inputs that are unique to the residential segment of the loan portfolio. Loan specific valuation allowances are only established on residential mortgage loans when they have been restructured and are established using the methodology described above for all loan portfolio segments. For residential mortgage loans, the Company's primary credit quality indicator is whether the loan is performing or nonperforming. The Company generally defines nonperforming residential mortgage loans as those that are 60 or more days past due and/or in non-accrual status which is assessed monthly. Generally, nonperforming residential mortgage loans have a higher risk of experiencing a credit loss. Credit Quality of Commercial Mortgage Loans The credit quality of commercial mortgage loans held-for-investment, were as follows:
Recorded Investment ------------------------------------------- Debt Service Coverage Ratios ----------------------------- % of Estimated % of > 1.20x 1.00x - 1.20x < 1.00x Total Total Fair Value Total ------- ------------- ------- ------- ----- ------------- ----- (In millions) (In millions) December 31, 2013: Loan-to-value ratios: Less than 65%......... $24,585 $ 476 $596 $25,657 77.6% $26,900 78.4% 65% to 75%............ 5,219 438 104 5,761 17.4 5,852 17.1 76% to 80%............ 444 157 189 790 2.4 776 2.3 Greater than 80%...... 583 205 76 864 2.6 769 2.2 ------- ------ ---- ------- ----- ------- ----- Total................ $30,831 $1,276 $965 $33,072 100.0% $34,297 100.0% ======= ====== ==== ======= ===== ======= =====
69 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 8. Investments (continued)
Recorded Investment ------------------------------------------------ Debt Service Coverage Ratios -------------------------------- % of Estimated % of > 1.20x 1.00x - 1.20x < 1.00x Total Total Fair Value Total --------- ------------- -------- --------- ----- ------------- ----- (In millions) (In millions) December 31, 2012: Loan-to-value ratios: Less than 65%......... $ 24,906 $ 452 $ 575 $ 25,933 77.7% $ 27,894 78.8% 65% to 75%............ 4,254 641 108 5,003 15.0 5,218 14.7 76% to 80%............ 448 123 259 830 2.5 863 2.4 Greater than 80%...... 847 501 255 1,603 4.8 1,451 4.1 --------- -------- -------- --------- ----- --------- ----- Total................ $ 30,455 $ 1,717 $ 1,197 $ 33,369 100.0% $ 35,426 100.0% ========= ======== ======== ========= ===== ========= =====
Credit Quality of Agricultural Mortgage Loans The credit quality of agricultural mortgage loans held-for-investment, were as follows:
December 31, -------------------------------------------- 2013 2012 --------------------- --------------------- Recorded % of Recorded % of Investment Total Investment Total ------------- ------- ------------- ------- (In millions) (In millions) Loan-to-value ratios: Less than 65%......... $ 10,165 92.2% $ 10,628 92.5% 65% to 75%............ 659 6.0 514 4.5 76% to 80%............ 84 0.8 92 0.8 Greater than 80%...... 117 1.0 253 2.2 --------- ------- --------- ------- Total................ $ 11,025 100.0% $ 11,487 100.0% ========= ======= ========= =======
The estimated fair value of agricultural mortgage loans held-for-investment was $11.3 billion and $11.8 billion at December 31, 2013 and 2012, respectively. Credit Quality of Residential Mortgage Loans The credit quality of residential mortgage loans held-for-investment, were as follows:
December 31, -------------------------------------------- 2013 2012 --------------------- --------------------- Recorded % of Recorded % of Investment Total Investment Total ------------- ------- ------------- ------- (In millions) (In millions) Performance indicators: Performing.............. $ 1,812 97.5% $ 105 100.0% Nonperforming........... 46 2.5 -- -- -------- ------- ------ ------- Total.................. $ 1,858 100.0% $ 105 100.0% ======== ======= ====== =======
70 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 8. Investments (continued) The estimated fair value of residential mortgage loans held-for-investment was $1.8 billion and $109 million at December 31, 2013 and 2012, respectively. Past Due and Interest Accrual Status of Mortgage Loans The Company has a high quality, well performing mortgage loan portfolio, with 99% of all mortgage loans classified as performing at both December 31, 2013 and 2012. The Company defines delinquency consistent with industry practice, when mortgage loans are past due as follows: commercial and residential mortgage loans -- 60 days and agricultural mortgage loans -- 90 days. The past due and accrual status of mortgage loans at recorded investment, prior to valuation allowances, by portfolio segment, were as follows at:
Greater than 90 Days Past Due and Past Due Still Accruing Interest Nonaccrual Status ----------------------------------- ----------------------------------- ----------------------------------- December 31, 2013 December 31, 2012 December 31, 2013 December 31, 2012 December 31, 2013 December 31, 2012 ----------------- ----------------- ----------------- ----------------- ----------------- ----------------- (In millions) Commercial... $ -- $ -- $ -- $ -- $ 169 $ 83 Agricultural. 44 116 -- 53 47 67 Residential.. 46 -- -- -- 46 -- -------- --------- -------- -------- --------- --------- Total $ 90 $ 116 $ -- $ 53 $ 262 $ 150 ======== ========= ======== ======== ========= =========
Impaired Mortgage Loans Impaired mortgage loans held-for-investment, including those modified in a troubled debt restructuring, by portfolio segment, were as follows at and for the years ended:
Loans without Loans with a Valuation Allowance a Valuation Allowance All Impaired Loans ---------------------------------------- -------------------- -------------------------------------- Unpaid Unpaid Unpaid Average Principal Recorded Valuation Carrying Principal Recorded Principal Carrying Recorded Interest Balance Investment Allowances Value Balance Investment Balance Value Investment Income --------- ---------- ---------- -------- --------- ---------- --------- -------- ---------- -------- (In millions) December 31, 2013: Commercial... $ 173 $ 169 $ 49 $ 120 $ 247 $ 246 $ 420 $ 366 $ 430 $ 12 Agricultural. 64 62 7 55 35 34 99 89 151 9 Residential.. -- -- -- -- 5 4 5 4 2 -- ------ ------ ------ ------ ------ ------ ------ ------ ------ ----- Total...... $ 237 $ 231 $ 56 $ 175 $ 287 $ 284 $ 524 $ 459 $ 583 $ 21 ====== ====== ====== ====== ====== ====== ====== ====== ====== ===== December 31, 2012: Commercial... $ 367 $ 359 $ 84 $ 275 $ 82 $ 82 $ 449 $ 357 $ 384 $ 11 Agricultural. 110 107 21 86 79 74 189 160 201 8 Residential.. -- -- -- -- -- -- -- -- -- -- ------ ------ ------ ------ ------ ------ ------ ------ ------ ----- Total...... $ 477 $ 466 $ 105 $ 361 $ 161 $ 156 $ 638 $ 517 $ 585 $ 19 ====== ====== ====== ====== ====== ====== ====== ====== ====== =====
Unpaid principal balance is generally prior to any charge-offs. Interest income recognized is primarily cash basis income. The average recorded investment for commercial, agricultural and residential mortgage loans was $257 million, $239 million and $0, respectively, for the year ended December 31, 2011; and interest income recognized for commercial, agricultural and residential mortgage loans was $5 million, $3 million and $0, respectively, for the year ended December 31, 2011. 71 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 8. Investments (continued) Mortgage Loans Modified in a Troubled Debt Restructuring For a small portion of the mortgage loan portfolio, classified as troubled debt restructurings, concessions are granted related to borrowers experiencing financial difficulties. Generally, the types of concessions include: reduction of the contractual interest rate, extension of the maturity date at an interest rate lower than current market interest rates, and/or a reduction of accrued interest. The amount, timing and extent of the concession granted is considered in determining any impairment or changes in the specific valuation allowance recorded with the restructuring. Through the continuous monitoring process, a specific valuation allowance may have been recorded prior to the quarter when the mortgage loan is modified in a troubled debt restructuring. Accordingly, the carrying value (after specific valuation allowance) before and after modification through a troubled debt restructuring may not change significantly, or may increase if the expected recovery is higher than the pre-modification recovery assessment. The number of mortgage loans and carrying value after specific valuation allowance of mortgage loans modified during the period in a troubled debt restructuring were as follows:
Years Ended December 31, --------------------------------------------------------------------------------------------------- 2013 2012 ------------------------------------------------- ------------------------------------------------- Number of Carrying Value after Specific Number of Carrying Value after Specific Mortgage Loans Valuation Allowance Mortgage Loans Valuation Allowance -------------- ---------------------------------- -------------- ---------------------------------- Pre-Modification Post-Modification Pre-Modification Post-Modification ---------------- ----------------- ---------------- ----------------- (In millions) (In millions) Commercial... 1 $ 49 $ 49 1 $ 168 $ 152 Agricultural. 2 24 24 5 17 16 Residential.. 27 5 5 -- -- -- ------ ------- ------- ----- -------- -------- Total....... 30 $ 78 $ 78 6 $ 185 $ 168 ====== ======= ======= ===== ======== ========
The Company had one residential mortgage loan modified in a troubled debt restructuring with a subsequent payment default with a carrying value of less than $1 million at December 31, 2013. There were no mortgage loans modified in a troubled debt restructuring with a subsequent payment default at December 31, 2012. Payment default is determined in the same manner as delinquency status as described above. Other Invested Assets Other invested assets is comprised primarily of freestanding derivatives with positive estimated fair values (see Note 9), tax credit and renewable energy partnerships, loans to affiliates (see "- Related Party Investment Transactions") and leveraged leases. 72 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 8. Investments (continued) Leveraged Leases Investment in leveraged leases consisted of the following at:
December 31, ----------------- 2013 2012 -------- -------- (In millions) Rental receivables, net................................... $ 1,393 $ 1,465 Estimated residual values................................. 853 927 Subtotal................................................. 2,246 2,392 Unearned income........................................... (742) (834) -------- -------- Investment in leveraged leases, net of non-recourse debt. $ 1,504 $ 1,558 ======== ========
Rental receivables are generally due in periodic installments. The payment periods range from one to 15 years but in certain circumstances can be over 30 years. For rental receivables, the primary credit quality indicator is whether the rental receivable is performing or nonperforming, which is assessed monthly. The Company generally defines nonperforming rental receivables as those that are 90 days or more past due. At December 31, 2013 and 2012, all rental receivables were performing. The deferred income tax liability related to leveraged leases was $1.4 billion at both December 31, 2013 and 2012. The components of income from investment in leveraged leases, excluding net investment gains (losses), were as follows:
Years Ended December 31, ------------------------ 2013 2012 2011 ------ ----- ----- (In millions) Income from investment in leveraged leases............................. $ 60 $ 34 $ 101 Less: Income tax expense on leveraged leases........................... 21 12 35 ------ ----- ----- Investment income after income tax from investment in leveraged leases. $ 39 $ 22 $ 66 ====== ===== =====
Cash Equivalents The carrying value of cash equivalents, which includes securities and other investments with an original or remaining maturity of three months or less at the time of purchase, was $790 million and $1.1 billion at December 31, 2013 and 2012, respectively. 73 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 8. Investments (continued) Net Unrealized Investment Gains (Losses) The components of net unrealized investment gains (losses), included in AOCI, were as follows:
Years Ended December 31, ---------------------------- 2013 2012 2011 -------- --------- --------- (In millions) Fixed maturity securities............................................... $ 8,521 $ 19,120 $ 14,266 Fixed maturity securities with noncredit OTTI losses in AOCI............ (149) (256) (522) -------- --------- --------- Total fixed maturity securities........................................ 8,372 18,864 13,744 Equity securities....................................................... 83 (13) (98) Derivatives............................................................. 361 1,052 1,293 Short-term investments.................................................. -- (2) (10) Other................................................................... 5 18 45 -------- --------- --------- Subtotal............................................................... 8,821 19,919 14,974 -------- --------- --------- Amounts allocated from: Insurance liability loss recognition................................... (610) (5,120) (3,495) DAC and VOBA related to noncredit OTTI losses recognized in AOCI................................................................. 5 12 33 DAC and VOBA........................................................... (721) (1,231) (1,102) Policyholder dividend obligation....................................... (1,771) (3,828) (2,919) -------- --------- --------- Subtotal............................................................. (3,097) (10,167) (7,483) Deferred income tax benefit (expense) related to noncredit OTTI losses recognized in AOCI.................................................... 51 86 172 Deferred income tax benefit (expense)................................... (2,070) (3,498) (2,794) -------- --------- --------- Net unrealized investment gains (losses)................................ 3,705 6,340 4,869 Net unrealized investment gains (losses) attributable to noncontrolling interests............................................................. (1) (1) (1) -------- --------- --------- Net unrealized investment gains (losses) attributable to Metropolitan Life Insurance Company................................................ $ 3,704 $ 6,339 $ 4,868 ======== ========= =========
The changes in fixed maturity securities with noncredit OTTI losses included in AOCI were as follows:
Years Ended December 31, -------------------------- 2013 2012 -------- -------- (In millions) Balance at January 1,....................................... $ (256) $ (522) Noncredit OTTI losses and subsequent changes recognized (1). 47 (22) Securities sold with previous noncredit OTTI loss........... 114 122 Subsequent changes in estimated fair value.................. (54) 166 -------- -------- Balance at December 31,..................................... $ (149) $ (256) ======== ========
-------- (1)Noncredit OTTI losses and subsequent changes recognized, net of DAC, were $40 million and ($26) million for the years ended December 31, 2013 and 2012, respectively. 74 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 8. Investments (continued) The changes in net unrealized investment gains (losses) were as follows:
Years Ended December 31, ------------------------------- 2013 2012 2011 --------- ---------- ---------- (In millions) Balance at January 1,................................................... $ 6,339 $ 4,868 $ 2,418 Fixed maturity securities on which noncredit OTTI losses have been recognized............................................................ 107 266 (103) Unrealized investment gains (losses) during the year.................... (11,205) 4,679 9,248 Unrealized investment gains (losses) relating to: Insurance liability gain (loss) recognition............................ 4,510 (1,625) (3,069) DAC and VOBA related to noncredit OTTI losses recognized in AOCI................................................................. (7) (21) 6 DAC and VOBA........................................................... 510 (129) (269) Policyholder dividend obligation....................................... 2,057 (909) (2,043) Deferred income tax benefit (expense) related to noncredit OTTI losses recognized in AOCI................................................... (35) (86) 34 Deferred income tax benefit (expense).................................. 1,428 (704) (1,354) --------- ---------- ---------- Net unrealized investment gains (losses)................................ 3,704 6,339 4,868 Net unrealized investment gains (losses) attributable to noncontrolling interests............................................................. -- -- -- --------- ---------- ---------- Balance at December 31,................................................. $ 3,704 $ 6,339 $ 4,868 ========= ========== ========== Change in net unrealized investment gains (losses)...................... $ (2,635) $ 1,471 $ 2,450 Change in net unrealized investment gains (losses) attributable to noncontrolling interests.............................................. -- -- -- --------- ---------- ---------- Change in net unrealized investment gains (losses) attributable to Metropolitan Life Insurance Company................................... $ (2,635) $ 1,471 $ 2,450 ========= ========== ==========
Concentrations of Credit Risk There were no investments in any counterparty that were greater than 10% of the Company's equity, other than the U.S. government and its agencies, at both December 31, 2013 and 2012. 75 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 8. Investments (continued) Securities Lending Elements of the securities lending program are presented below at:
December 31, ------------------- 2013 2012 --------- --------- (In millions) Securities on loan: (1) Amortized cost........................................ $ 18,829 $ 16,224 Estimated fair value.................................. $ 19,153 $ 18,564 Cash collateral on deposit from counterparties (2)..... $ 19,673 $ 19,036 Security collateral on deposit from counterparties (3). $ -- $ 46 Reinvestment portfolio -- estimated fair value......... $ 19,822 $ 19,392
-------- (1)Included within fixed maturity securities, short-term investments and equity securities. (2)Included within payables for collateral under securities loaned and other transactions. (3)Security collateral on deposit from counterparties may not be sold or repledged, unless the counterparty is in default, and is not reflected in the consolidated financial statements. Invested Assets on Deposit and Pledged as Collateral Invested assets on deposit and pledged as collateral are presented below at estimated fair value for cash and cash equivalents, short-term investments, fixed maturity and equity securities, and trading and FVO securities, and at carrying value for mortgage loans at:
December 31, ----------------- 2013 2012 -------- -------- (In millions) Invested assets on deposit (regulatory deposits)............ $ 1,338 $ 1,555 Invested assets pledged as collateral (1)................... 19,555 19,812 -------- -------- Total invested assets on deposit and pledged as collateral. $ 20,893 $ 21,367 ======== ========
-------- (1)The Company has pledged invested assets in connection with various agreements and transactions, including funding agreements (see Note 4), and derivative transactions (see Note 9). See "-- Securities Lending" for securities on loan and Note 7 for investments designated to the closed block. Purchased Credit Impaired Investments Investments acquired with evidence of credit quality deterioration since origination and for which it is probable at the acquisition date that the Company will be unable to collect all contractually required payments are classified as purchased credit impaired ("PCI") investments. For each investment, the excess of the cash flows expected to be collected as of the acquisition date over its acquisition date fair value is referred to as the 76 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 8. Investments (continued) accretable yield and is recognized as net investment income on an effective yield basis. If subsequently, based on current information and events, it is probable that there is a significant increase in cash flows previously expected to be collected or if actual cash flows are significantly greater than cash flows previously expected to be collected, the accretable yield is adjusted prospectively. The excess of the contractually required payments (including interest) as of the acquisition date over the cash flows expected to be collected as of the acquisition date is referred to as the nonaccretable difference, and this amount is not expected to be realized as net investment income. Decreases in cash flows expected to be collected can result in OTTI. The Company's PCI fixed maturity securities were as follows at:
December 31, ----------------- 2013 2012 -------- -------- (In millions) Outstanding principal and interest balance (1). $ 4,653 $ 4,335 Carrying value (2)............................. $ 3,601 $ 3,441
-------- (1)Represents the contractually required payments, which is the sum of contractual principal, whether or not currently due, and accrued interest. (2)Estimated fair value plus accrued interest. The following table presents information about PCI fixed maturity securities acquired during the periods indicated:
Years Ended December 31, -------------------------- 2013 2012 --------- --------- (In millions) Contractually required payments (including interest). $ 1,612 $ 1,911 Cash flows expected to be collected (1).............. $ 1,248 $ 1,436 Fair value of investments acquired................... $ 841 $ 936
-------- (1)Represents undiscounted principal and interest cash flow expectations, at the date of acquisition. The following table presents activity for the accretable yield on PCI fixed maturity securities for:
Years Ended December 31, -------------------------- 2013 2012 --------- --------- (In millions) Accretable yield, January 1,........................ $ 2,357 $ 1,978 Investments purchased............................... 407 500 Accretion recognized in earnings.................... (236) (181) Disposals........................................... (144) (84) Reclassification (to) from nonaccretable difference. 47 144 --------- --------- Accretable yield, December 31,...................... $ 2,431 $ 2,357 ========= =========
77 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 8. Investments (continued) Collectively Significant Equity Method Investments The Company holds investments in real estate joint ventures, real estate funds and other limited partnership interests consisting of leveraged buy-out funds, hedge funds, private equity funds, joint ventures and other funds. The portion of these investments accounted for under the equity method had a carrying value of $8.8 billion at December 31, 2013. The Company's maximum exposure to loss related to these equity method investments is limited to the carrying value of these investments plus unfunded commitments of $2.7 billion at December 31, 2013. Except for certain real estate joint ventures, the Company's investments in real estate funds and other limited partnership interests are generally of a passive nature in that the Company does not participate in the management of the entities. As described in Note 1, the Company generally records its share of earnings in its equity method investments using a three-month lag methodology and within net investment income. Aggregate net investment income from these equity method investments exceeded 10% of the Company's consolidated pre-tax income (loss) from continuing operations for two of the three most recent annual periods: 2013 and 2011. The Company is providing the following aggregated summarized financial data for such equity method investments, for the most recent annual periods, in order to provide comparative information. This aggregated summarized financial data does not represent the Company's proportionate share of the assets, liabilities, or earnings of such entities. The aggregated summarized financial data presented below reflects the latest available financial information and is as of, and for, the years ended December 31, 2013, 2012 and 2011. Aggregate total assets of these entities totaled $280.7 billion and $259.4 billion at December 31, 2013 and 2012, respectively. Aggregate total liabilities of these entities totaled $23.5 billion and $22.2 billion at December 31, 2013 and 2012, respectively. Aggregate net income (loss) of these entities totaled $25.0 billion, $16.5 billion and $8.4 billion for the years ended December 31, 2013, 2012 and 2011, respectively. Aggregate net income (loss) from the underlying entities in which the Company invests is primarily comprised of investment income, including recurring investment income and realized and unrealized investment gains (losses). Variable Interest Entities The Company has invested in certain structured transactions (including CSEs) that are VIEs. In certain instances, the Company holds both the power to direct the most significant activities of the entity, as well as an economic interest in the entity and, as such, is deemed to be the primary beneficiary or consolidator of the entity. The determination of the VIE's primary beneficiary requires an evaluation of the contractual and implied rights and obligations associated with each party's relationship with or involvement in the entity, an estimate of the entity's expected losses and expected residual returns and the allocation of such estimates to each party involved in the entity. The Company generally uses a qualitative approach to determine whether it is the primary beneficiary. However, for VIEs that are investment companies or apply measurement principles consistent with those utilized by investment companies, the primary beneficiary is based on a risks and rewards model and is defined as the entity that will absorb a majority of a VIE's expected losses, receive a majority of a VIE's expected residual returns if no single entity absorbs a majority of expected losses, or both. The Company reassesses its involvement with VIEs on a quarterly basis. The use of different methodologies, assumptions and inputs in the determination of the primary beneficiary could have a material effect on the amounts presented within the consolidated financial statements. 78 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 8. Investments (continued) Consolidated VIEs The following table presents the total assets and total liabilities relating to VIEs for which the Company has concluded that it is the primary beneficiary and which are consolidated at December 31, 2013 and 2012. Creditors or beneficial interest holders of VIEs where the Company is the primary beneficiary have no recourse to the general credit of the Company, as the Company's obligation to the VIEs is limited to the amount of its committed investment.
December 31, --------------------------------------- 2013 2012 -------------------- ------------------ Total Total Total Total Assets Liabilities Assets Liabilities -------- ----------- ------ ----------- (In millions) Real estate joint ventures (1)............................................ $ 1,181 $ 443 $ 11 $ 14 Fixed maturity securities (2)............................................. 159 80 172 83 Other invested assets..................................................... 82 7 85 -- Other limited partnership interests....................................... 61 -- 189 1 CSEs (assets (primarily securities) and liabilities (primarily debt)) (3). 23 22 51 50 -------- ------ ----- ----- Total.................................................................... $ 1,506 $ 552 $ 508 $ 148 ======== ====== ===== =====
-------- (1)The Company consolidated an open ended core real estate fund formed in the fourth quarter of 2013, which represented the majority of the balances at December 31, 2013. Assets of the real estate fund are a real estate investment trust which holds primarily traditional core income-producing real estate which have associated liabilities that are primarily non-recourse debt secured by certain real estate assets of the fund. The assets of these entities can only be used to settle their respective liabilities, and under no circumstances is the Company liable for any principal or interest shortfalls should any arise. The Company's exposure was limited to that of its investment in the real estate fund of $178 million at carrying value at December 31, 2013. The long-term debt bears interest primarily at fixed rates ranging from 1.39% to 4.45%, payable primarily on a monthly basis. Interest expense related to these obligations, included in other expenses, was less than $1 million for the year ended December 31, 2013. (2)The Company consolidates certain fixed maturity securities purchased in an investment vehicle which was partially funded with affiliated long-term debt. The long-term debt bears interest primarily at variable rates, payable on a bi-annual basis. Interest expense related to these obligations, included in other expenses, was $2 million and $1 million for the years ended December 31, 2013 and 2012, respectively. There was no interest expense for the year ended December 31, 2011. (3)The Company consolidates entities that are structured as collateralized debt obligations. The assets of these entities can only be used to settle their respective liabilities, and under no circumstances is the Company liable for any principal or interest shortfalls should any arise. The Company's exposure was limited to that of its remaining investment in these entities of less than $1 million at estimated fair value at both December 31, 2013 and 2012. The long-term debt bears interest primarily at variable rates, payable on a bi-annual basis. Interest expense related to these obligations, included in other expenses, was $3 million, $4 million and $9 million for the years ended December 31, 2013, 2012 and 2011, respectively. 79 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 8. Investments (continued) Unconsolidated VIEs The carrying amount and maximum exposure to loss relating to VIEs in which the Company holds a significant variable interest but is not the primary beneficiary and which have not been consolidated were as follows at:
December 31, ------------------------------------------- 2013 2012 --------------------- --------------------- Maximum Maximum Carrying Exposure Carrying Exposure Amount to Loss (1) Amount to Loss (1) --------- ----------- --------- ----------- (In millions) Fixed maturity securities AFS: Structured securities (RMBS, CMBS and ABS) (2). $ 40,910 $ 40,910 $ 42,936 $ 42,936 U.S. and foreign corporate..................... 2,251 2,251 2,566 2,566 Other limited partnership interests............. 3,168 4,273 2,966 3,880 Other invested assets........................... 1,498 1,852 1,068 1,381 Real estate joint ventures...................... 31 31 34 40 --------- --------- --------- --------- Total.......................................... $ 47,858 $ 49,317 $ 49,570 $ 50,803 ========= ========= ========= =========
-------- (1)The maximum exposure to loss relating to fixed maturity securities AFS is equal to their carrying amounts or the carrying amounts of retained interests. The maximum exposure to loss relating to other limited partnership interests and real estate joint ventures is equal to the carrying amounts plus any unfunded commitments of the Company. For certain of its investments in other invested assets, the Company's return is in the form of income tax credits which are guaranteed by creditworthy third parties. For such investments, the maximum exposure to loss is equal to the carrying amounts plus any unfunded commitments, reduced by income tax credits guaranteed by third parties of $257 million and $315 million at December 31, 2013 and 2012, respectively. Such a maximum loss would be expected to occur only upon bankruptcy of the issuer or investee. (2)For these variable interests, the Company's involvement is limited to that of a passive investor. As described in Note 17, the Company makes commitments to fund partnership investments in the normal course of business. Excluding these commitments, the Company did not provide financial or other support to investees designated as VIEs during the years ended December 31, 2013, 2012 and 2011. 80 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 8. Investments (continued) Net Investment Income The components of net investment income were as follows:
Years Ended December 31, ----------------------------- 2013 2012 2011 --------- --------- --------- (In millions) Investment income: Fixed maturity securities......................... $ 8,279 $ 8,295 $ 8,225 Equity securities................................. 78 68 73 Trading and FVO securities (1).................... 43 77 29 Mortgage loans.................................... 2,405 2,528 2,401 Policy loans...................................... 440 451 479 Real estate and real estate joint ventures........ 699 593 493 Other limited partnership interests............... 633 555 435 Cash, cash equivalents and short-term investments. 32 19 12 International joint ventures...................... (4) (2) (1) Other............................................. 21 7 112 --------- --------- --------- Subtotal........................................ 12,626 12,591 12,258 Less: Investment expenses......................... 844 743 652 --------- --------- --------- Subtotal, net................................... 11,782 11,848 11,606 --------- --------- --------- FVO CSEs--interest income: Securities........................................ 3 4 9 --------- --------- --------- Subtotal........................................ 3 4 9 --------- --------- --------- Net investment income......................... $ 11,785 $ 11,852 $ 11,615 ========= ========= =========
-------- (1)Changes in estimated fair value subsequent to purchase for securities still held as of the end of the respective years included in net investment income were $4 million, $44 million and $2 million for the years ended December 31, 2013, 2012, and 2011, respectively. See "-- Variable Interest Entities" for discussion of CSEs. See "-- Related Party Investment Transactions" for discussion of affiliated net investment income and investment expenses. 81 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 8. Investments (continued) Net Investment Gains (Losses) Components of Net Investment Gains (Losses) The components of net investment gains (losses) were as follows:
Years Ended December 31, -------------------------- 2013 2012 2011 ------ -------- ------ (In millions) Total gains (losses) on fixed maturity securities: Total OTTI losses recognized -- by sector and industry: U.S. and foreign corporate securities -- by industry: Utility............................................................ $ (48) $ (29) $ -- Consumer........................................................... (12) (19) (40) Finance............................................................ (4) (21) (37) Communications..................................................... (2) (18) (26) Industrial......................................................... -- (4) (8) Transportation..................................................... -- (1) -- ------ -------- ------ Total U.S. and foreign corporate securities...................... (66) (92) (111) RMBS................................................................. (62) (70) (78) CMBS................................................................. -- (28) (9) ABS.................................................................. -- (2) (28) Foreign government................................................... -- -- (1) ------ -------- ------ OTTI losses on fixed maturity securities recognized in earnings........ (128) (192) (227) Fixed maturity securities -- net gains (losses) on sales and disposals. 177 16 107 ------ -------- ------ Total gains (losses) on fixed maturity securities.................... 49 (176) (120) ------ -------- ------ Total gains (losses) on equity securities: Total OTTI losses recognized -- by sector: Non-redeemable preferred stock....................................... (17) -- (33) Common stock......................................................... (2) (7) (8) ------ -------- ------ OTTI losses on equity securities recognized in earnings................ (19) (7) (41) Equity securities -- net gains (losses) on sales and disposals......... 6 15 44 ------ -------- ------ Total gains (losses) on equity securities............................ (13) 8 3 ------ -------- ------ Trading and FVO securities -- FVO general account securities........... 11 11 (2) Mortgage loans......................................................... 31 84 133 Real estate and real estate joint ventures............................. (15) (27) 133 Other limited partnership interests.................................... (41) (35) 11 Other investment portfolio gains (losses).............................. 5 (192) (4) ------ -------- ------ Subtotal -- investment portfolio gains (losses).................... 27 (327) 154 ------ -------- ------ FVO CSEs: Securities............................................................. 2 -- -- Long-term debt -- related to securities................................ (2) (7) (8) Non-investment portfolio gains (losses)................................. 21 4 (14) ------ -------- ------ Subtotal FVO CSEs and non-investment portfolio gains (losses)...... 21 (3) (22) ------ -------- ------ Total net investment gains (losses).............................. $ 48 $ (330) $ 132 ====== ======== ======
82 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 8. Investments (continued) See "-- Variable Interest Entities" for discussion of CSEs. See "-- Related Party Investment Transactions" for discussion of affiliated net investment gains (losses) related to transfers of invested assets to affiliates. Gains (losses) from foreign currency transactions included within net investment gains (losses) were less than $1 million, $2 million and $21 million for the years ended December 31, 2013, 2012 and 2011, respectively. Sales or Disposals and Impairments of Fixed Maturity and Equity Securities Proceeds from sales or disposals of fixed maturity and equity securities and the components of fixed maturity and equity securities net investment gains (losses) are as shown in the table below. Investment gains and losses on sales of securities are determined on a specific identification basis.
Years Ended December 31, ----------------------------------------------------------------------- 2013 2012 2011 2013 2012 2011 2013 2012 2011 -------- -------- -------- ----- ----- ----- -------- -------- -------- Fixed Maturity Securities Equity Securities Total -------------------------- ----------------- -------------------------- (In millions) Proceeds............................ $ 45,538 $ 29,472 $ 34,015 $ 144 $ 126 $ 771 $ 45,682 $ 29,598 $ 34,786 ======== ======== ======== ===== ===== ===== ======== ======== ======== Gross investment gains.............. $ 556 $ 327 $ 445 $ 25 $ 23 $ 86 $ 581 $ 350 $ 531 -------- -------- -------- ----- ----- ----- -------- -------- -------- Gross investment losses............. (379) (311) (338) (19) (8) (42) (398) (319) (380) -------- -------- -------- ----- ----- ----- -------- -------- -------- Total OTTI losses: Credit-related.................... (115) (125) (183) -- -- -- (115) (125) (183) Other (1)......................... (13) (67) (44) (19) (7) (41) (32) (74) (85) -------- -------- -------- ----- ----- ----- -------- -------- -------- Total OTTI losses................ (128) (192) (227) (19) (7) (41) (147) (199) (268) -------- -------- -------- ----- ----- ----- -------- -------- -------- Net investment gains (losses)... $ 49 $ (176) $ (120) $(13) $ 8 $ 3 $ 36 $ (168) $ (117) ======== ======== ======== ===== ===== ===== ======== ======== ========
-------- (1)Other OTTI losses recognized in earnings include impairments on (i) equity securities, (ii) perpetual hybrid securities classified within fixed maturity securities where the primary reason for the impairment was the severity and/or the duration of an unrealized loss position and (iii) fixed maturity securities where there is an intent to sell or it is more likely than not that the Company will be required to sell the security before recovery of the decline in estimated fair value. 83 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 8. Investments (continued) Credit Loss Rollforward The table below presents a rollforward of the cumulative credit loss component of OTTI loss recognized in earnings on fixed maturity securities still held for which a portion of the OTTI loss was recognized in OCI:
Years Ended December 31, ------------------------ 2013 2012 ---------- ---------- (In millions) Balance at January 1,................................................... $ 285 $ 316 Additions: Initial impairments -- credit loss OTTI recognized on securities not previously impaired.................................... 4 38 Additional impairments -- credit loss OTTI recognized on securities previously impaired........................................ 54 45 Reductions: Sales (maturities, pay downs or prepayments) during the period of securities previously impaired as credit loss OTTI................. (65) (95) Securities impaired to net present value of expected future cash flows. -- (17) Increases in cash flows -- accretion of previous credit loss OTTI...... (1) (2) ---------- ---------- Balance at December 31,................................................. $ 277 $ 285 ========== ==========
Related Party Investment Transactions The Company transfers invested assets, primarily consisting of fixed maturity securities, to and from affiliates. Invested assets transferred to and from affiliates were as follows:
Years Ended December 31, ------------------------ 2013 2012 2011 ------ ------- ------ (In millions) Estimated fair value of invested assets transferred to affiliates... $ 781 $ 4 $ 170 Amortized cost of invested assets transferred to affiliates......... $ 688 $ 4 $ 164 Net investment gains (losses) recognized on transfers............... $ 93 $ -- $ 6 Estimated fair value of invested assets transferred from affiliates. $ 882 $ -- $ 132
Included within the transfers to affiliates in 2013 and transfers from affiliates in 2013 was $751 million and $739 million, respectively, related to the establishment of a custodial account to secure certain policyholder liabilities. See Note 20. The Company purchased from MetLife Bank, $1.5 billion of fixed maturity securities, at estimated fair value, for cash during the year ended December 31, 2012. See "-- Mortgage Loans" for information on additional purchases from this affiliate. The Company provides investment administrative services to certain affiliates. The related investment administrative service charges to these affiliates were $172 million, $158 million and $164 million for the years ended December 31, 2013, 2012 and 2011, respectively. The Company also had additional affiliated net investment income of $4 million, $4 million and $3 million for the years ended December 31, 2013, 2012 and 2011, respectively. 84 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 8. Investments (continued) The Company has affiliated loans outstanding, which are included in other invested assets, totaling $1.5 billion at both December 31, 2013 and 2012. At December 31, 2011, the loans were outstanding with Exeter. During 2012, MetLife, Inc. assumed this affiliated debt from Exeter. One loan matured on September 30, 2012 and was replaced by a new loan on October 1, 2012. The loans, which bear interest at a fixed rate, payable semiannually are due as follows: $500 million at 6.44% due on June 30, 2014, $250 million at 3.57% due on October 1, 2019, $250 million at 7.44% due on September 30, 2016, $150 million at 5.64% due July 15, 2021 and $375 million at 5.86% due December 16, 2021. Net investment income from these loans was $90 million, $93 million and $69 million for the years ended December 31, 2013, 2012 and 2011, respectively. The Company has a loan outstanding to Exeter, which is included in other invested assets, totaling $75 million at both December 31, 2013 and 2012. This loan is due on December 30, 2014 and bears interest on a weighted average of 6.80%. Net investment income from this loan was $5 million for each of the years ended December 31, 2013, 2012 and 2011, respectively. 9. Derivatives Accounting for Derivatives See Note 1 for a description of the Company's accounting policies for derivatives and Note 10 for information about the fair value hierarchy for derivatives. Derivative Strategies The Company is exposed to various risks relating to its ongoing business operations, including interest rate, foreign currency exchange rate, credit and equity market. The Company uses a variety of strategies to manage these risks, including the use of derivatives. Derivatives are financial instruments whose values are derived from interest rates, foreign currency exchange rates, credit spreads and/or other financial indices. Derivatives may be exchange-traded or contracted in the over-the-counter ("OTC") market. Certain of the Company's OTC derivatives are cleared and settled through central clearing counterparties ("OTC-cleared"), while others are bilateral contracts between two counterparties ("OTC-bilateral"). The types of derivatives the Company uses include swaps, forwards, futures and option contracts. To a lesser extent, the Company uses credit default swaps and structured interest rate swaps to synthetically replicate investment risks and returns which are not readily available in the cash market. Interest Rate Derivatives The Company uses a variety of interest rate derivatives to reduce its exposure to changes in interest rates, including interest rate swaps, caps, floors, swaptions and forwards. Interest rate swaps are used by the Company primarily to reduce market risks from changes in interest rates and to alter interest rate exposure arising from mismatches between assets and liabilities (duration mismatches). In an interest rate swap, the Company agrees with another party to exchange, at specified intervals, the difference between fixed rate and floating rate interest amounts as calculated by reference to an agreed notional amount. The Company utilizes interest rate swaps in fair value, cash flow and non-qualifying hedging relationships. 85 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 9. Derivatives (continued) The Company uses structured interest rate swaps to synthetically create investments that are either more expensive to acquire or otherwise unavailable in the cash markets. These transactions are a combination of a derivative and a cash instrument such as a U.S. Treasury, agency, or other fixed maturity security. Structured interest rate swaps are included in interest rate swaps. Structured interest rate swaps are not designated as hedging instruments. The Company purchases interest rate caps and floors primarily to protect its floating rate liabilities against rises in interest rates above a specified level, and against interest rate exposure arising from mismatches between assets and liabilities, as well as to protect its minimum rate guarantee liabilities against declines in interest rates below a specified level, respectively. In certain instances, the Company locks in the economic impact of existing purchased caps and floors by entering into offsetting written caps and floors. The Company utilizes interest rate caps and floors in non-qualifying hedging relationships. Swaptions are used by the Company to hedge interest rate risk associated with the Company's long-term liabilities and invested assets. A swaption is an option to enter into a swap with a forward starting effective date. In certain instances, the Company locks in the economic impact of existing purchased swaptions by entering into offsetting written swaptions. The Company pays a premium for purchased swaptions and receives a premium for written swaptions. The Company utilizes swaptions in non-qualifying hedging relationships. Swaptions are included in interest rate options. The Company enters into interest rate forwards to buy and sell securities. The price is agreed upon at the time of the contract and payment for such a contract is made at a specified future date. The Company utilizes interest rate forwards in cash flow hedging relationships. To a lesser extent the Company uses interest rate futures in non-qualifying hedging relationships. Foreign Currency Exchange Rate Derivatives The Company uses foreign currency exchange rate derivatives including foreign currency swaps, and foreign currency forwards to reduce the risk from fluctuations in foreign currency exchange rates associated with its assets and liabilities denominated in foreign currencies. In a foreign currency swap transaction, the Company agrees with another party to exchange, at specified intervals, the difference between one currency and another at a fixed exchange rate, generally set at inception, calculated by reference to an agreed upon notional amount. The notional amount of each currency is exchanged at the inception and termination of the currency swap by each party. The Company utilizes foreign currency swaps in fair value, cash flow and non-qualifying hedging relationships. In a foreign currency forward transaction, the Company agrees with another party to deliver a specified amount of an identified currency at a specified future date. The price is agreed upon at the time of the contract and payment for such a contract is made at the specified future date. The Company utilizes foreign currency forwards in non-qualifying hedging relationships. To a lesser extent, the Company uses currency options in non-qualifying hedging relationships. 86 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 9. Derivatives (continued) Credit Derivatives The Company enters into purchased credit default swaps to hedge against credit-related changes in the value of its investments. In a credit default swap transaction, the Company agrees with another party to pay, at specified intervals, a premium to hedge credit risk. If a credit event occurs, as defined by the contract, the contract may be cash settled or it may be settled gross by the delivery of par quantities of the referenced investment equal to the specified swap notional in exchange for the payment of cash amounts by the counterparty equal to the par value of the investment surrendered. Credit events vary by type of issuer but typically include bankruptcy, failure to pay debt obligations, repudiation, moratorium, or involuntary restructuring. In each case, payout on a credit default swap is triggered only after the Credit Derivatives Determinations Committee of the International Swaps and Derivatives Association, Inc. ("ISDA") deems that a credit event has occurred. The Company utilizes credit default swaps in non-qualifying hedging relationships. The Company enters into written credit default swaps to synthetically create credit investments that are either more expensive to acquire or otherwise unavailable in the cash markets. These transactions are a combination of a derivative and one or more cash instruments, such as U.S. Treasury securities, agency securities or other fixed maturity securities. These credit default swaps are not designated as hedging instruments. The Company also enters into certain purchased and written credit default swaps held in relation to trading portfolios for the purpose of generating profits on short-term differences in price. These credit default swaps are not designated as hedging instruments. The Company enters into forwards to lock in the price to be paid for forward purchases of certain securities. The price is agreed upon at the time of the contract and payment for the contract is made at a specified future date. When the primary purpose of entering into these transactions is to hedge against the risk of changes in purchase price due to changes in credit spreads, the Company designates these as credit forwards. The Company utilizes credit forwards in cash flow hedging relationships. Equity Derivatives To a lesser extent the Company uses equity index options in non-qualifying hedging relationships. 87 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 9. Derivatives (continued) Primary Risks Managed by Derivatives The following table presents the gross notional amount, estimated fair value and primary underlying risk exposure of the Company's derivatives, excluding embedded derivatives, held at:
December 31, --------------------------------------------------------------- 2013 2012 ------------------------------- ------------------------------- Estimated Fair Value Estimated Fair Value -------------------- -------------------- Notional Notional Primary Underlying Risk Exposure Amount Assets Liabilities Amount Assets Liabilities -------------------------------- ---------- -------- ----------- ---------- -------- ----------- (In millions) Derivatives Designated as Hedging Instruments Fair value hedges: Interest rate swaps..... Interest rate.................... $ 5,940 $ 1,277 $ 68 $ 4,824 $ 1,893 $ 79 Foreign currency swaps.. Foreign currency exchange rate... 2,591 252 122 3,064 332 71 ---------- -------- -------- ---------- -------- -------- Subtotal.............................................. 8,531 1,529 190 7,888 2,225 150 ---------- -------- -------- ---------- -------- -------- Cash flow hedges: Interest rate swaps..... Interest rate.................... 2,584 77 109 2,984 606 -- Interest rate forwards.. Interest rate.................... 205 3 3 265 58 -- Foreign currency swaps.. Foreign currency exchange rate... 10,560 374 500 7,595 198 246 ---------- -------- -------- ---------- -------- -------- Subtotal.............................................. 13,349 454 612 10,844 862 246 ---------- -------- -------- ---------- -------- -------- Total qualifying hedges............................. 21,880 1,983 802 18,732 3,087 396 ---------- -------- -------- ---------- -------- -------- Derivatives Not Designated or Not Qualifying as Hedging Instruments Interest rate swaps....... Interest rate.................... 59,022 1,320 732 41,008 1,978 854 Interest rate floors...... Interest rate.................... 38,220 323 234 33,870 737 493 Interest rate caps........ Interest rate.................... 29,809 141 -- 40,434 63 -- Interest rate futures..... Interest rate.................... 105 -- -- 2,476 -- 10 Interest rate options..... Interest rate.................... 4,849 120 8 4,862 336 2 Synthetic GICs............ Interest rate.................... 4,409 -- -- 4,162 -- -- Foreign currency swaps.... Foreign currency exchange rate... 7,267 79 492 6,411 137 532 Foreign currency forwards. Foreign currency exchange rate... 4,261 44 32 2,131 16 26 Currency options.......... Foreign currency exchange rate... -- -- -- 129 1 -- Credit default swaps--purchased......... Credit........................... 1,506 7 21 1,463 7 14 Credit default swaps--written........... Credit........................... 6,600 124 1 6,230 55 5 Equity options............ Equity market.................... 1,147 -- -- 630 1 -- ---------- -------- -------- ---------- -------- -------- Total non-designated or non-qualifying derivatives.... 157,195 2,158 1,520 143,806 3,331 1,936 ---------- -------- -------- ---------- -------- -------- Total............................................... $ 179,075 $ 4,141 $ 2,322 $ 162,538 $ 6,418 $ 2,332 ========== ======== ======== ========== ======== ========
Based on notional amounts, a substantial portion of the Company's derivatives was not designated or did not qualify as part of a hedging relationship at both December 31, 2013 and 2012. The Company's use of derivatives includes (i) derivatives that serve as macro hedges of the Company's exposure to various risks and that generally do not qualify for hedge accounting due to the criteria required under the portfolio hedging rules; (ii) derivatives that economically hedge insurance liabilities that contain mortality or morbidity risk and that generally do not qualify for hedge accounting because the lack of these risks in the derivatives cannot support an expectation of a highly effective hedging relationship; and (iii) written credit default swaps that are used to synthetically create credit investments and that do not qualify for hedge accounting because they do not involve a hedging relationship. For these non-qualified derivatives, changes in market factors can lead to the recognition of fair value changes in the consolidated statement of operations without an offsetting gain or loss recognized in earnings for the item being hedged. 88 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 9. Derivatives (continued) Net Derivative Gains (Losses) The components of net derivative gains (losses) were as follows:
Years Ended December 31, --------------------------- 2013 2012 2011 ---------- ------- -------- (In millions) Derivatives and hedging gains (losses) (1). $ (1,205) $ 77 $ 2,040 Embedded derivatives....................... 135 598 (462) ---------- ------- -------- Total net derivative gains (losses)....... $ (1,070) $ 675 $ 1,578 ========== ======= ========
-------- (1)Includes foreign currency transaction gains (losses) on hedged items in cash flow and non-qualifying hedging relationships, which are not presented elsewhere in this note. The following table presents earned income on derivatives:
Years Ended December 31, ------------------------ 2013 2012 2011 ------ ------ ------ (In millions) Qualifying hedges: Net investment income.............................. $ 129 $ 108 $ 96 Interest credited to policyholder account balances. 148 146 173 Non-qualifying hedges: Net investment income.............................. (6) (6) (8) Net derivative gains (losses)...................... 450 314 179 ------ ------ ------ Total............................................ $ 721 $ 562 $ 440 ====== ====== ======
89 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 9. Derivatives (continued) Non-Qualifying Derivatives and Derivatives for Purposes Other Than Hedging The following table presents the amount and location of gains (losses) recognized in income for derivatives that were not designated or qualifying as hedging instruments:
Net Net Derivative Investment Gains (Losses) Income (1) -------------- ---------- (In millions) Year Ended December 31, 2013: Interest rate derivatives.................. $ (1,753) $ -- Foreign currency exchange rate derivatives. (69) -- Credit derivatives -- purchased............ (6) (14) Credit derivatives -- written.............. 100 1 Equity derivatives......................... -- (22) ---------- --------- Total.................................... $ (1,728) $ (35) ========== ========= Year Ended December 31, 2012: Interest rate derivatives.................. $ (83) $ -- Foreign currency exchange rate derivatives. (252) -- Credit derivatives -- purchased............ (72) (15) Credit derivatives -- written.............. 105 -- Equity derivatives......................... -- (12) ---------- --------- Total.................................... $ (302) $ (27) ========== ========= Year Ended December 31, 2011: Interest rate derivatives.................. $ 1,679 $ -- Foreign currency exchange rate derivatives. 103 -- Credit derivatives -- purchased............ 74 6 Credit derivatives -- written.............. (61) (1) Equity derivatives......................... -- (14) ---------- --------- Total.................................... $ 1,795 $ (9) ========== =========
-------- (1)Changes in estimated fair value related to economic hedges of equity method investments in joint ventures, and changes in estimated fair value related to derivatives held in relation to trading portfolios. Fair Value Hedges The Company designates and accounts for the following as fair value hedges when they have met the requirements of fair value hedging: (i) interest rate swaps to convert fixed rate assets and liabilities to floating rate assets and liabilities; and (ii) foreign currency swaps to hedge the foreign currency fair value exposure of foreign currency denominated assets and liabilities. 90 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 9. Derivatives (continued) The Company recognizes gains and losses on derivatives and the related hedged items in fair value hedges within net derivative gains (losses). The following table presents the amount of such net derivative gains (losses):
Net Derivative Net Derivative Ineffectiveness Gains (Losses) Gains (Losses) Recognized in Derivatives in Fair Value Hedged Items in Fair Value Hedging Recognized Recognized for Net Derivative Hedging Relationships Relationships for Derivatives Hedged Items Gains (Losses) ------------------------- ----------------------------------- --------------- -------------- --------------- (In millions) Year Ended December 31, 2013: Interest rate swaps: Fixed maturity securities.......... $ 34 $ (33) $ 1 Policyholder liabilities (1)....... (800) 807 7 Foreign currency swaps: Foreign-denominated fixed maturity securities......................... 13 (12) 1 Foreign-denominated PABs (2)....... (98) 112 14 ---------- ---------- --------- Total..................................................... $ (851) $ 874 $ 23 ========== ========== ========= Year Ended December 31, 2012: Interest rate swaps: Fixed maturity securities.......... $ 2 $ (3) $ (1) Policyholder liabilities (1)....... (72) 89 17 Foreign currency swaps: Foreign-denominated fixed maturity securities......................... (1) 1 -- Foreign-denominated PABs (2)....... 32 (41) (9) ---------- ---------- --------- Total..................................................... $ (39) $ 46 $ 7 ========== ========== ========= Year Ended December 31, 2011: Interest rate swaps: Fixed maturity securities.......... $ (18) $ 18 $ -- Policyholder liabilities (1)....... 1,019 (994) 25 Foreign currency swaps: Foreign-denominated fixed maturity securities......................... 1 3 4 Foreign-denominated PABs (2)....... 28 (55) (27) ---------- ---------- --------- Total..................................................... $ 1,030 $ (1,028) $ 2 ========== ========== =========
-------- (1)Fixed rate liabilities reported in PABs or future policy benefits. (2)Fixed rate or floating rate liabilities. All components of each derivative's gain or loss were included in the assessment of hedge effectiveness. Cash Flow Hedges The Company designates and accounts for the following as cash flow hedges when they have met the requirements of cash flow hedging: (i) interest rate swaps to convert floating rate assets and liabilities to fixed rate assets and liabilities; (ii) foreign currency swaps to hedge the foreign currency cash flow exposure of foreign currency denominated assets and liabilities; (iii) interest rate forwards and credit forwards to lock in the price to be paid for forward purchases of investments; and (iv) interest rate swaps and interest rate forwards to hedge the forecasted purchases of fixed-rate investments. In certain instances, the Company discontinued cash flow hedge accounting because the forecasted transactions were no longer probable of occurring. Because certain of the forecasted transactions also were not probable of occurring within two months of the anticipated date, the Company reclassified certain amounts from AOCI into net derivative gains (losses). These amounts were not significant for the year ending December 31, 2013, and were $1 million and $3 million for the years ended December 31, 2012 and 2011, respectively. 91 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 9. Derivatives (continued) At December 31, 2013 and 2012, the maximum length of time over which the Company was hedging its exposure to variability in future cash flows for forecasted transactions did not exceed seven years and eight years, respectively. At December 31, 2013 and 2012, the balance in AOCI associated with cash flow hedges was $361 million and $1.1 billion, respectively. The following table presents the effects of derivatives in cash flow hedging relationships on the consolidated statements of operations and the consolidated statements of equity:
Amount and Location Amount and Location Amount of Gains of Gains (Losses) of Gains (Losses) Derivatives in Cash Flow (Losses) Deferred in Reclassified from Recognized in Income Hedging Relationships AOCI on Derivatives AOCI into Income (Loss) (Loss) on Derivatives ------------------------ -------------------- ----------------------------- ----------------------- (Effective Portion) (Effective Portion) (Ineffective Portion) - -------------------- ----------------------------- ----------------------- Net Derivative Net Investment Net Derivative Gains (Losses) Income Gains (Losses) -------------- -------------- ----------------------- (In millions) Year Ended December 31, 2013: Interest rate swaps...... $ (511) $ 20 $ 8 $ (3) Interest rate forwards... (43) 1 2 -- Foreign currency swaps... (120) (15) (3) 2 Credit forwards.......... (3) -- 1 -- -------------------- -------------- -------------- ----------------------- Total.................. $ (677) $ 6 $ 8 $ (1) ==================== ============== ============== ======================= Year Ended December 31, 2012: Interest rate swaps...... $ (55) $ 3 $ 4 $ 1 Interest rate forwards... (1) -- 2 -- Foreign currency swaps... (187) (7) (5) (5) Credit forwards.......... -- -- 1 -- -------------------- -------------- -------------- ----------------------- Total.................. $ (243) $ (4) $ 2 $ (4) ==================== ============== ============== ======================= Year Ended December 31, 2011: Interest rate swaps...... $ 919 $ -- $ 1 $ 1 Interest rate forwards... 128 22 2 2 Foreign currency swaps... 166 7 (5) 1 Credit forwards.......... 18 1 -- -- -------------------- -------------- -------------- ----------------------- Total.................. $ 1,231 $ 30 $ (2) $ 4 ==================== ============== ============== =======================
All components of each derivative's gain or loss were included in the assessment of hedge effectiveness. At December 31, 2013, ($17) million of deferred net gains (losses) on derivatives in AOCI was expected to be reclassified to earnings within the next 12 months. Credit Derivatives In connection with synthetically created credit investment transactions and credit default swaps held in relation to the trading portfolio, the Company writes credit default swaps for which it receives a premium to insure credit risk. Such credit derivatives are included within the non-qualifying derivatives and derivatives for purposes other than hedging table. If a credit event occurs, as defined by the contract, the contract may be cash settled or it may be settled gross by the Company paying the counterparty the specified swap notional amount in exchange for the delivery of par quantities of the referenced credit obligation. The Company's maximum amount at risk, assuming the value of all referenced credit obligations is zero, was $6.6 billion and $6.2 billion at December 31, 2013 and 92 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 9. Derivatives (continued) 2012, respectively. The Company can terminate these contracts at any time through cash settlement with the counterparty at an amount equal to the then current fair value of the credit default swaps. At December 31, 2013 and 2012, the Company would have received $123 million and $50 million, respectively, to terminate all of these contracts. The following table presents the estimated fair value, maximum amount of future payments and weighted average years to maturity of written credit default swaps at:
December 31, --------------------------------------------------------------------------------- 2013 2012 ---------------------------------------- ---------------------------------------- Estimated Maximum Estimated Maximum Fair Value Amount of Future Weighted Fair Value Amount of Future Weighted Rating Agency Designation of of Credit Payments under Average of Credit Payments under Average Referenced Default Credit Default Years to Default Credit Default Years to Credit Obligations (1) Swaps Swaps (2) Maturity (3) Swaps Swaps (2) Maturity (3) ---------------------------- ---------- ---------------- ------------ ---------- ---------------- ------------ (In millions) (In millions) Aaa/Aa/A Single name credit default swaps (corporate).................... $ 6 $ 395 2.6 $ 7 $ 573 2.5 Credit default swaps referencing indices........................ 20 2,089 1.6 31 2,064 2.1 ---------- ---------------- ---------- ---------------- Subtotal........................ 26 2,484 1.7 38 2,637 2.2 ---------- ---------------- ---------- ---------------- Baa Single name credit default swaps (corporate).................... 16 874 3.2 4 835 3.2 Credit default swaps referencing indices........................ 52 2,898 4.7 6 2,469 4.9 ---------- ---------------- ---------- ---------------- Subtotal........................ 68 3,772 4.4 10 3,304 4.5 ---------- ---------------- ---------- ---------------- Ba Single name credit default swaps (corporate).................... -- 5 3.8 -- 25 2.7 Credit default swaps referencing indices........................ -- -- -- -- -- -- ---------- ---------------- ---------- ---------------- Subtotal........................ -- 5 3.8 -- 25 2.7 ---------- ---------------- ---------- ---------------- B Single name credit default swaps (corporate).................... -- -- -- -- -- -- Credit default swaps referencing indices........................ 29 339 4.9 2 264 4.9 ---------- ---------------- ---------- ---------------- Subtotal........................ 29 339 4.9 2 264 4.9 ---------- ---------------- ---------- ---------------- Total......................... $ 123 $ 6,600 3.4 $ 50 $ 6,230 3.5 ========== ================ ========== ================
-------- (1)The rating agency designations are based on availability and the midpoint of the applicable ratings among Moody's Investors Service ("Moody's"), S&P and Fitch Ratings. If no rating is available from a rating agency, then an internally developed rating is used. 93 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 9. Derivatives (continued) (2)Assumes the value of the referenced credit obligations is zero. (3)The weighted average years to maturity of the credit default swaps is calculated based on weighted average notional amounts. The Company has also entered into credit default swaps to purchase credit protection on certain of the referenced credit obligations in the table above. As a result, the maximum amounts of potential future recoveries available to offset the $6.6 billion and $6.2 billion from the table above were $70 million and $120 million at December 31, 2013 and 2012, respectively. Written credit default swaps held in relation to the trading portfolio amounted to $10 million in notional and $0 in fair value at both December 31, 2013 and 2012. Credit Risk on Freestanding Derivatives The Company may be exposed to credit-related losses in the event of nonperformance by counterparties to derivatives. Generally, the current credit exposure of the Company's derivatives is limited to the net positive estimated fair value of derivatives at the reporting date after taking into consideration the existence of master netting or similar agreements and any collateral received pursuant to such agreements. The Company manages its credit risk related to derivatives by entering into transactions with creditworthy counterparties and establishing and monitoring exposure limits. The Company's OTC-bilateral derivative transactions are generally governed by ISDA Master Agreements which provide for legally enforceable set-off and close-out netting of exposures to specific counterparties in the event of early termination of a transaction, which includes, but is not limited to, events of default and bankruptcy. In the event of an early termination, the Company is permitted to set-off receivables from the counterparty against payables to the same counterparty arising out of all included transactions. Substantially all of the Company's ISDA Master Agreements also include Credit Support Annex provisions which require both the pledging and accepting of collateral in connection with its OTC-bilateral derivatives. The Company's OTC-cleared derivatives are effected through central clearing counterparties and its exchange-traded derivatives are effected through regulated exchanges. Such positions are marked to market and margined on a daily basis, and the Company has minimal exposure to credit-related losses in the event of nonperformance by counterparties to such derivatives. See Note 10 for a description of the impact of credit risk on the valuation of derivatives. 94 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 9. Derivatives (continued) The estimated fair value of the Company's net derivative assets and net derivative liabilities after the application of master netting agreements and collateral was as follows at:
December 31, 2013 December 31, 2012 Derivatives Subject to a Master Netting Arrangement or a Similar -------------------- -------------------- Arrangement Assets Liabilities Assets Liabilities ---------------------------------------------------------------- -------- ----------- -------- ----------- (In millions) Gross estimated fair value of derivatives: OTC-bilateral (1).............................................. $ 4,026 $ 2,232 $ 6,556 $ 2,408 OTC-cleared (1)................................................ 251 117 -- -- Exchange-traded................................................ -- -- -- 10 -------- -------- -------- -------- Total gross estimated fair value of derivatives (1).......... 4,277 2,349 6,556 2,418 Amounts offset in the consolidated balance sheets............... -- -- -- -- -------- -------- -------- -------- Estimated fair value of derivatives presented in the consolidated balance sheets (1)............................... 4,277 2,349 6,556 2,418 Gross amounts not offset in the consolidated balance sheets: Gross estimated fair value of derivatives: (2) OTC-bilateral.................................................. (1,844) (1,844) (2,083) (2,083) OTC-cleared.................................................... (114) (114) -- -- Exchange-traded................................................ -- -- -- -- Cash collateral: (3) OTC-bilateral.................................................. (1,143) (3) (3,425) (1) OTC-cleared.................................................... (128) (3) -- -- Exchange-traded................................................ -- -- -- (10) Securities collateral: (4) OTC-bilateral.................................................. (1,024) (319) (1,048) (261) OTC-cleared.................................................... -- -- -- -- Exchange-traded................................................ -- -- -- -- -------- -------- -------- -------- Net amount after application of master netting agreements and collateral.................................................... $ 24 $ 66 $ -- $ 63 ======== ======== ======== ========
-------- (1)At December 31, 2013 and 2012, derivative assets include income or expense accruals reported in accrued investment income or in other liabilities of $136 million and $138 million, respectively, and derivative liabilities include income or expense accruals reported in accrued investment income or in other liabilities of $27 million and $86 million, respectively. (2)Estimated fair value of derivatives is limited to the amount that is subject to set-off and includes income or expense accruals. (3)Cash collateral received is included in cash and cash equivalents , short-term investments or in fixed maturity securities, and the obligation to return it is included in payables for collateral under securities loaned and other transactions in the consolidated balance sheets. The receivable for the return of cash collateral provided by the Company is inclusive of initial margin on exchange-traded and OTC-cleared 95 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 9. Derivatives (continued) derivatives and is included in premiums, reinsurance and other receivables in the consolidated balance sheets. The amount of cash collateral offset in the table above is limited to the net estimated fair value of derivatives after application of netting agreements. At December 31, 2013 and 2012, the Company received excess cash collateral of $47 million and $0, respectively, and provided excess cash collateral of $3 million and $25 million, respectively, which is not included in the table above due to the foregoing limitation. (4)Securities collateral received by the Company is held in separate custodial accounts and is not recorded on the consolidated balance sheets. Subject to certain constraints, the Company is permitted by contract to sell or repledge this collateral, but at December 31, 2013 none of the collateral had been sold or repledged. Securities collateral pledged by the Company is reported in fixed maturity securities in the consolidated balance sheets. Subject to certain constraints, the counterparties are permitted by contract to sell or repledge this collateral. The amount of securities collateral offset in the table above is limited to the net estimated fair value of derivatives after application of netting agreements and cash collateral. At December 31, 2013 and 2012, the Company received excess securities collateral with an estimated fair value of $106 million and $139 million, respectively, for its OTC-bilateral derivatives which are not included in the table above due to the foregoing limitation. At December 31, 2013 and 2012, the Company provided excess securities collateral with an estimated fair value of $25 million and $0 , respectively, for its OTC-bilateral derivatives, and $106 million and $0, respectively, for its OTC-cleared derivatives, which are not included in the table above due to the foregoing limitation. At both December 31, 2013 and 2012, the Company did not pledge any securities collateral for its exchange traded derivatives. The Company's collateral arrangements for its OTC-bilateral derivatives generally require the counterparty in a net liability position, after considering the effect of netting agreements, to pledge collateral when the fair value of that counterparty's derivatives reaches a pre-determined threshold. Certain of these arrangements also include financial strength-contingent provisions that provide for a reduction of these thresholds (on a sliding scale that converges toward zero) in the event of downgrades in the financial strength ratings of the Company and/or the credit ratings of the counterparty. In addition, certain of the Company's netting agreements for derivatives contain provisions that require both the Company and the counterparty to maintain a specific investment grade financial strength or credit rating from each of Moody's and S&P. If a party's financial strength or credit ratings were to fall below that specific investment grade financial strength or credit rating, that party would be in violation of these provisions, and the other party to the derivatives could terminate the transactions and demand immediate settlement and payment based on such party's reasonable valuation of the derivatives. 96 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 9. Derivatives (continued) The following table presents the estimated fair value of the Company's OTC-bilateral derivatives that are in a net liability position after considering the effect of netting agreements, together with the estimated fair value and balance sheet location of the collateral pledged. The table also presents the incremental collateral that the Company would be required to provide if there was a one notch downgrade in the Company's financial strength rating at the reporting date or if the Company's financial strength rating sustained a downgrade to a level that triggered full overnight collateralization or termination of the derivative position at the reporting date. OTC-bilateral derivatives that are not subject to collateral agreements are excluded from this table.
Estimated Fair Value of Fair Value of Incremental Collateral Collateral Provided: Provided Upon: ---------------------------- ------------------------------------------ Downgrade in the Company's Financial Strength Rating to a Estimated One Notch Level that Triggers Full Fair Value of Downgrade in Overnight Derivatives in the Company's Collateralization or Net Liability Fixed Maturity Financial Termination Position (1) Securities Cash Strength Rating of the Derivative Position -------------- -------------- ------------- --------------- -------------------------- (In millions) December 31, 2013: Derivatives subject to financial strength-contingent provisions..................... $ 354 $ 344 $ -- $ -- $ 5 Derivatives not subject to financial strength-contingent provisions..................... 4 -- 3 -- -- -------------- -------------- ------------- --------------- -------------------------- Total........................... $ 358 $ 344 $ 3 $ -- $ 5 ============== ============== ============= =============== ========================== December 31, 2012: Derivatives subject to financial strength-contingent provisions..................... $ 263 $ 261 $ -- $ -- $ 1 Derivatives not subject to financial strength-contingent provisions..................... -- -- 1 -- -- -------------- -------------- ------------- --------------- -------------------------- Total........................... $ 263 $ 261 $ 1 $ -- $ 1 ============== ============== ============= =============== ==========================
-------- (1)After taking into consideration the existence of netting agreements. Embedded Derivatives The Company issues certain products or purchases certain investments that contain embedded derivatives that are required to be separated from their host contracts and accounted for as freestanding derivatives. These host contracts principally include: variable annuities with guaranteed minimum benefits, including GMWBs, GMABs and certain GMIBs; affiliated ceded reinsurance of guaranteed minimum benefits related to GMWBs, GMABs and certain GMIBs; funds withheld on ceded reinsurance and affiliated funds withheld on ceded reinsurance; funding agreements with equity or bond indexed crediting rates; and certain debt and equity securities. 97 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 9. Derivatives (continued) The following table presents the estimated fair value and balance sheet location of the Company's embedded derivatives that have been separated from their host contracts at:
December 31, ----------------- Balance Sheet Location 2013 2012 -------------------------- -------- -------- (In millions) Net embedded derivatives within asset host contracts: Ceded guaranteed minimum benefits...................... Premiums, reinsurance and other receivables......... $ (62) $ 1,362 Options embedded in debt or equity securities............................................ Investments............... (106) (55) -------- -------- Net embedded derivatives within asset host contracts.......................... $ (168) $ 1,307 ======== ======== Net embedded derivatives within liability host contracts: Direct guaranteed minimum benefits..................... PABs...................... $ (868) $ (92) Funds withheld on ceded reinsurance.................... Other liabilities......... 758 1,563 Other.................................................. PABs...................... 4 16 -------- -------- Net embedded derivatives within liability host contracts...................... $ (106) $ 1,487 ======== ========
The following table presents changes in estimated fair value related to embedded derivatives:
Years Ended December 31, ---------------------- 2013 2012 2011 ------ ------ -------- (In millions) Net derivative gains (losses) (1), (2). $ 135 $ 598 $ (462)
-------- (1)The valuation of direct guaranteed minimum benefits includes a nonperformance risk adjustment. The amounts included in net derivative gains (losses), in connection with this adjustment, were ($42) million, ($71) million and $88 million for the years ended December 31, 2013, 2012 and 2011, respectively. In addition, the valuation of ceded guaranteed minimum benefits includes a nonperformance risk adjustment. The amounts included in net derivative gains (losses) in connection with this adjustment were $125 million, $122 million and ($219) million for the years ended December 31, 2013, 2012 and 2011, respectively. (2)See Note 6 for discussion of affiliated net derivative gains (losses) included in the table above. 98 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 10. Fair Value When developing estimated fair values, the Company considers three broad valuation techniques: (i) the market approach, (ii) the income approach, and (iii) the cost approach. The Company determines the most appropriate valuation technique to use, given what is being measured and the availability of sufficient inputs, giving priority to observable inputs. The Company categorizes its assets and liabilities measured at estimated fair value into a three-level hierarchy, based on the significant input with the lowest level in its valuation. The input levels are as follows: Level 1 Unadjusted quoted prices in active markets for identical assets or liabilities. The Company defines active markets based on average trading volume for equity securities. The size of the bid/ask spread is used as an indicator of market activity for fixed maturity securities. Level 2 Quoted prices in markets that are not active or inputs that are observable either directly or indirectly. These inputs can include quoted prices for similar assets or liabilities other than quoted prices in Level 1, quoted prices in markets that are not active, or other significant inputs that are observable or can be derived principally from or corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 Unobservable inputs that are supported by little or no market activity and are significant to the determination of estimated fair value of the assets or liabilities. Unobservable inputs reflect the reporting entity's own assumptions about the assumptions that market participants would use in pricing the asset or liability. Financial markets are susceptible to severe events evidenced by rapid depreciation in asset values accompanied by a reduction in asset liquidity. The Company's ability to sell securities, or the price ultimately realized for these securities, depends upon the demand and liquidity in the market and increases the use of judgment in determining the estimated fair value of certain securities. Considerable judgment is often required in interpreting market data to develop estimates of fair value, and the use of different assumptions or valuation methodologies may have a material effect on the estimated fair value amounts. 99 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 10. Fair Value (continued) Recurring Fair Value Measurements The assets and liabilities measured at estimated fair value on a recurring basis and their corresponding placement in the fair value hierarchy, including those items for which the Company has elected the FVO, are presented below.
December 31, 2013 ---------------------------------------------- Fair Value Hierarchy ------------------------------ Total Estimated Level 1 Level 2 Level 3 Fair Value --------- ---------- --------- --------------- (In millions) Assets Fixed maturity securities: U.S. corporate............................................. $ -- $ 58,960 $ 5,269 $ 64,229 U.S. Treasury and agency................................... 15,858 14,624 62 30,544 Foreign corporate.......................................... -- 25,558 3,198 28,756 RMBS....................................................... -- 22,197 2,513 24,710 CMBS....................................................... -- 7,946 430 8,376 ABS........................................................ -- 5,298 2,526 7,824 State and political subdivision............................ -- 5,777 -- 5,777 Foreign government......................................... -- 3,256 274 3,530 --------- ---------- --------- ------------ Total fixed maturity securities........................... 15,858 143,616 14,272 173,746 --------- ---------- --------- ------------ Equity securities: Common stock............................................... 361 753 50 1,164 Non-redeemable preferred stock............................. -- 450 278 728 --------- ---------- --------- ------------ Total equity securities................................... 361 1,203 328 1,892 --------- ---------- --------- ------------ Trading and FVO securities: Actively Traded Securities................................. 2 648 12 662 FVO general account securities............................. -- 24 14 38 FVO securities held by CSEs................................ -- 23 -- 23 --------- ---------- --------- ------------ Total trading and FVO securities.......................... 2 695 26 723 Short-term investments (1)................................... 1,387 4,224 175 5,786 Residential mortgage loans -- FVO -- -- 338 338 Derivative assets: (2) Interest rate............................................. -- 3,258 3 3,261 Foreign currency exchange rate............................ -- 735 14 749 Credit.................................................... -- 108 23 131 Equity market............................................. -- -- -- -- --------- ---------- --------- ------------ Total derivative assets.................................. -- 4,101 40 4,141 --------- ---------- --------- ------------ Net embedded derivatives within asset host contracts (3)..... -- -- (62) (62) Separate account assets (4).................................. 28,422 105,165 1,209 134,796 --------- ---------- --------- ------------ Total assets............................................. $ 46,030 $ 259,004 $ 16,326 $ 321,360 ========= ========== ========= ============ Liabilities Derivative liabilities: (2) Interest rate.............................................. $ -- $ 1,150 $ 4 $ 1,154 Foreign currency exchange rate............................. -- 1,146 -- 1,146 Credit..................................................... -- 22 -- 22 Equity market.............................................. -- -- -- -- --------- ---------- --------- ------------ Total derivative liabilities.............................. -- 2,318 4 2,322 Net embedded derivatives within liability host contracts (3). -- 4 (110) (106) Long-term debt............................................... -- 79 43 122 Long-term debt of CSEs....................................... -- -- 28 28 Trading liabilities (5)...................................... 260 2 -- 262 --------- ---------- --------- ------------ Total liabilities........................................ $ 260 $ 2,403 $ (35) $ 2,628 ========= ========== ========= ============
100 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 10. Fair Value (continued)
December 31, 2012 ------------------------------------------------ Fair Value Hierarchy -------------------------------- Total Estimated Level 1 Level 2 Level 3 Fair Value ---------- ---------- ---------- --------------- (In millions) Assets Fixed maturity securities: U.S. corporate............................................. $ -- $ 61,540 $ 5,460 $ 67,000 U.S. Treasury and agency................................... 17,653 14,927 71 32,651 Foreign corporate.......................................... -- 27,180 3,054 30,234 RMBS....................................................... -- 23,323 1,702 25,025 CMBS....................................................... -- 9,384 402 9,786 ABS........................................................ -- 6,202 1,923 8,125 State and political subdivision............................ -- 6,720 -- 6,720 Foreign government......................................... -- 3,853 282 4,135 ---------- ---------- ---------- ---------- Total fixed maturity securities.......................... 17,653 153,129 12,894 183,676 ---------- ---------- ---------- ---------- Equity securities: Common stock............................................... 189 792 60 1,041 Non-redeemable preferred stock............................. -- 177 281 458 ---------- ---------- ---------- ---------- Total equity securities.................................. 189 969 341 1,499 ---------- ---------- ---------- ---------- Trading and FVO securities: Actively Traded Securities................................. 7 646 6 659 FVO general account securities............................. -- 26 26 52 FVO securities held by CSEs................................ -- 41 -- 41 ---------- ---------- ---------- ---------- Total trading and FVO securities......................... 7 713 32 752 ---------- ---------- ---------- ---------- Short-term investments (1)................................... 2,565 3,936 252 6,753 Residential mortgage loans -- FVO............................ -- -- -- -- Derivative assets: (2) Interest rate............................................ -- 5,613 58 5,671 Foreign currency exchange rate........................... -- 646 38 684 Credit................................................... -- 29 33 62 Equity market............................................ -- 1 -- 1 ---------- ---------- ---------- ---------- Total derivative assets................................. -- 6,289 129 6,418 ---------- ---------- ---------- ---------- Net embedded derivatives within asset host contracts (3)..... -- -- 1,362 1,362 Separate account assets (4).................................. 24,237 95,794 940 120,971 ---------- ---------- ---------- ---------- Total assets............................................ $ 44,651 $ 260,830 $ 15,950 $ 321,431 ========== ========== ========== ========== Liabilities Derivative liabilities: (2) Interest rate.............................................. $ 10 $ 1,428 $ -- $ 1,438 Foreign currency exchange rate............................. -- 874 1 875 Credit..................................................... -- 19 -- 19 ---------- ---------- ---------- ---------- Total derivative liabilities.......................... 10 2,321 1 2,332 Net embedded derivatives within liability host contracts (3). -- 16 1,471 1,487 Long-term debt............................................... -- -- -- -- Long-term debt of CSEs....................................... -- -- 44 44 Trading liabilities (5)...................................... 163 -- -- 163 ---------- ---------- ---------- ---------- Total liabilities....................................... $ 173 $ 2,337 $ 1,516 $ 4,026 ========== ========== ========== ==========
-------- (1)Short-term investments as presented in the tables above differ from the amounts presented in the consolidated balance sheets because certain short-term investments are not measured at estimated fair value on a recurring basis. 101 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 10. Fair Value (continued) (2)Derivative assets are presented within other invested assets in the consolidated balance sheets and derivative liabilities are presented within other liabilities in the consolidated balance sheets. The amounts are presented gross in the tables above to reflect the presentation in the consolidated balance sheets, but are presented net for purposes of the rollforward in the Fair Value Measurements Using Significant Unobservable Inputs (Level 3) tables. (3)Net embedded derivatives within asset host contracts are presented within premiums, reinsurance and other receivables in the consolidated balance sheets. Net embedded derivatives within liability host contracts are presented within PABs and other liabilities in the consolidated balance sheets. At December 31, 2013 and 2012, equity securities also included embedded derivatives of ($106) million and ($55) million, respectively. (4)Investment performance related to separate account assets is fully offset by corresponding amounts credited to contractholders whose liability is reflected within separate account liabilities. Separate account liabilities are set equal to the estimated fair value of separate account assets. (5)Trading liabilities are presented within other liabilities in the consolidated balance sheets. The following describes the valuation methodologies used to measure assets and liabilities at fair value. The description includes the valuation techniques and key inputs for each category of assets or liabilities that are classified within Level 2 and Level 3 of the fair value hierarchy. Investments Valuation Controls and Procedures On behalf of the Company and MetLife, Inc.'s Chief Investment Officer and Chief Financial Officer, a pricing and valuation committee that is independent of the trading and investing functions and comprised of senior management, provides oversight of control systems and valuation policies for securities, mortgage loans and derivatives. On a quarterly basis, this committee reviews and approves new transaction types and markets, ensures that observable market prices and market-based parameters are used for valuation, wherever possible, and determines that judgmental valuation adjustments, when applied, are based upon established policies and are applied consistently over time. This committee also provides oversight of the selection of independent third party pricing providers and the controls and procedures to evaluate third party pricing. Periodically, the Chief Accounting Officer reports to the Audit Committees of Metropolitan Life Insurance Company's and MetLife, Inc.'s Boards of Directors regarding compliance with fair value accounting standards. The Company reviews its valuation methodologies on an ongoing basis and revises those methodologies when necessary based on changing market conditions. Assurance is gained on the overall reasonableness and consistent application of input assumptions, valuation methodologies and compliance with fair value accounting standards through controls designed to ensure valuations represent an exit price. Several controls are utilized, including certain monthly controls, which include, but are not limited to, analysis of portfolio returns to corresponding benchmark returns, comparing a sample of executed prices of securities sold to the fair value estimates, comparing fair value estimates to management's knowledge of the current market, reviewing the bid/ask spreads to assess activity, comparing prices from multiple independent pricing services and ongoing due diligence to confirm that independent pricing services use market-based parameters. The 102 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 10. Fair Value (continued) process includes a determination of the observability of inputs used in estimated fair values received from independent pricing services or brokers by assessing whether these inputs can be corroborated by observable market data. The Company ensures that prices received from independent brokers, also referred to herein as "consensus pricing," represent a reasonable estimate of fair value by considering such pricing relative to the Company's knowledge of the current market dynamics and current pricing for similar financial instruments. While independent non-binding broker quotations are utilized, they are not used for a significant portion of the portfolio. For example, fixed maturity securities priced using independent non-binding broker quotations represent 1% of the total estimated fair value of fixed maturity securities and 12% of the total estimated fair value of Level 3 fixed maturity securities. The Company also applies a formal process to challenge any prices received from independent pricing services that are not considered representative of estimated fair value. If prices received from independent pricing services are not considered reflective of market activity or representative of estimated fair value, independent non-binding broker quotations are obtained, or an internally developed valuation is prepared. Internally developed valuations of current estimated fair value, which reflect internal estimates of liquidity and nonperformance risks, compared with pricing received from the independent pricing services, did not produce material differences in the estimated fair values for the majority of the portfolio; accordingly, overrides were not material. This is, in part, because internal estimates of liquidity and nonperformance risks are generally based on available market evidence and estimates used by other market participants. In the absence of such market-based evidence, management's best estimate is used. Securities, Short-term Investments, Long-term Debt and Trading Liabilities When available, the estimated fair value of these financial instruments is based on quoted prices in active markets that are readily and regularly obtainable. Generally, these are the most liquid of the Company's securities holdings and valuation of these securities does not involve management's judgment. When quoted prices in active markets are not available, the determination of estimated fair value is based on market standard valuation methodologies, giving priority to observable inputs. The significant inputs to the market standard valuation methodologies for certain types of securities with reasonable levels of price transparency are inputs that are observable in the market or can be derived principally from, or corroborated by, observable market data. When observable inputs are not available, the market standard valuation methodologies rely on inputs that are significant to the estimated fair value that are not observable in the market or cannot be derived principally from, or corroborated by, observable market data. These unobservable inputs can be based in large part on management's judgment or estimation and cannot be supported by reference to market activity. Even though these inputs are unobservable, management believes they are consistent with what other market participants would use when pricing such securities and are considered appropriate given the circumstances. The estimated fair value of FVO securities held by CSEs, long-term debt and trading liabilities is determined on a basis consistent with the methodologies described herein for securities. Level 2 Valuation Techniques and Key Inputs: This level includes securities priced principally by independent pricing services using observable inputs. Trading and FVO securities and short-term investments within this level are of a similar nature and class to the Level 2 fixed maturity securities and equity securities. 103 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 10. Fair Value (continued) U.S. corporate and foreign corporate securities These securities are principally valued using the market and income approaches. Valuations are based primarily on quoted prices in markets that are not active, or using matrix pricing or other similar techniques that use standard market observable inputs such as benchmark yields, spreads off benchmark yields, new issuances, issuer rating, duration, and trades of identical or comparable securities. Privately-placed securities are valued using matrix pricing methodologies using standard market observable inputs, and inputs derived from, or corroborated by, market observable data including market yield curve, duration, call provisions, observable prices and spreads for similar publicly traded or privately traded issues that incorporate the credit quality and industry sector of the issuer, and in certain cases, delta spread adjustments to reflect specific credit-related issues. U.S. Treasury and agency securities These securities are principally valued using the market approach. Valuations are based primarily on quoted prices in markets that are not active, or using matrix pricing or other similar techniques using standard market observable inputs such as a benchmark U.S. Treasury yield curve, the spread off the U.S. Treasury yield curve for the identical security and comparable securities that are actively traded. Structured securities comprised of RMBS, CMBS and ABS These securities are principally valued using the market and income approaches. Valuations are based primarily on matrix pricing, discounted cash flow methodologies or other similar techniques using standard market inputs, including spreads for actively traded securities, spreads off benchmark yields, expected prepayment speeds and volumes, current and forecasted loss severity, rating, weighted average coupon, weighted average maturity, average delinquency rates, geographic region, debt-service coverage ratios and issuance-specific information, including, but not limited to: collateral type, payment terms of the underlying assets, payment priority within the tranche, structure of the security, deal performance and vintage of loans. State and political subdivision and foreign government securities These securities are principally valued using the market approach. Valuations are based primarily on matrix pricing or other similar techniques using standard market observable inputs, including a benchmark U.S. Treasury yield or other yields, issuer ratings, broker-dealer quotes, issuer spreads and reported trades of similar securities, including those within the same sub-sector or with a similar maturity or credit rating. Common and non-redeemable preferred stock These securities are principally valued using the market approach. Valuations are based principally on observable inputs, including quoted prices in markets that are not considered active. Level 3 Valuation Techniques and Key Inputs: In general, securities classified within Level 3 use many of the same valuation techniques and inputs as described previously for Level 2. However, if key inputs are unobservable, or if the investments are less 104 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 10. Fair Value (continued) liquid and there is very limited trading activity, the investments are generally classified as Level 3. The use of independent non-binding broker quotations to value investments generally indicates there is a lack of liquidity or a lack of transparency in the process to develop the valuation estimates, generally causing these investments to be classified in Level 3. Trading and FVO securities and short-term investments within this level are of a similar nature and class to the Level 3 securities described below; accordingly, the valuation techniques and significant market standard observable inputs used in their valuation are also similar to those described below. U.S. corporate and foreign corporate securities These securities, including financial services industry hybrid securities classified within fixed maturity securities, are principally valued using the market approach. Valuations are based primarily on matrix pricing or other similar techniques that utilize unobservable inputs or inputs that cannot be derived principally from, or corroborated by, observable market data, including illiquidity premium, delta spread adjustments to reflect specific credit-related issues, credit spreads; and inputs including quoted prices for identical or similar securities that are less liquid and based on lower levels of trading activity than securities classified in Level 2. Certain valuations are based on independent non-binding broker quotations. Structured securities comprised of RMBS, CMBS and ABS These securities are principally valued using the market and income approaches. Valuations are based primarily on matrix pricing, discounted cash flow methodologies or other similar techniques that utilize inputs that are unobservable or cannot be derived principally from, or corroborated by, observable market data, including credit spreads. Below investment grade securities and sub-prime RMBS included in this level are valued based on inputs including quoted prices for identical or similar securities that are less liquid and based on lower levels of trading activity than securities classified in Level 2. Certain of these valuations are based on independent non-binding broker quotations. Foreign government securities These securities are principally valued using the market approach. Valuations are based primarily on independent non-binding broker quotations and inputs, including quoted prices for identical or similar securities that are less liquid and based on lower levels of trading activity than securities classified in Level 2. Certain valuations are based on matrix pricing that utilize inputs that are unobservable or cannot be derived principally from, or corroborated by, observable market data, including credit spreads. Common and non-redeemable preferred stock These securities, including privately-held securities and financial services industry hybrid securities classified within equity securities, are principally valued using the market and income approaches. Valuations are based primarily on matrix pricing, discounted cash flow methodologies or other similar techniques using inputs such as comparable credit rating and issuance structure. Certain of these securities are valued based on inputs including quoted prices for identical or similar securities that are less liquid and based on lower levels of trading activity than securities classified in Level 2 and independent non-binding broker quotations. 105 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 10. Fair Value (continued) Mortgage Loans The Company has elected the FVO for certain residential mortgage loans held-for-investment. Level 3 Valuation Techniques and Key Inputs: Residential mortgage loans -- FVO For these investments, the estimated fair values are based primarily on matrix pricing or other similar techniques that utilize inputs that are unobservable or cannot be derived principally from, or corroborated by, observable market data. Separate Account Assets Separate account assets are carried at estimated fair value and reported as a summarized total on the consolidated balance sheets. The estimated fair value of separate account assets is based on the estimated fair value of the underlying assets. Separate account assets include: mutual funds, fixed maturity securities, equity securities, derivatives, hedge funds, other limited partnership interests, short-term investments and cash and cash equivalents. Level 2 Valuation Techniques and Key Inputs: These assets are comprised of investments that are similar in nature to the instruments described under "-- Securities, Short-term Investments, Long-term Debt and Trading Liabilities" and "-- Derivatives -- Freestanding Derivatives." Also included are certain mutual funds and hedge funds without readily determinable fair values as prices are not published publicly. Valuation of the mutual funds and hedge funds is based upon quoted prices or reported NAV provided by the fund managers. Level 3 Valuation Techniques and Key Inputs: These assets are comprised of investments that are similar in nature to the instruments described under "-- Securities, Short-term Investments, Long-term Debt and Trading Liabilities" and "-- Derivatives -- Freestanding Derivatives." Also included are other limited partnership interests, which are valued giving consideration to the value of the underlying holdings of the partnerships and by applying a premium or discount, if appropriate, for factors such as liquidity, bid/ask spreads, the performance record of the fund manager or other relevant variables that may impact the exit value of the particular partnership interest. Derivatives The estimated fair value of derivatives is determined through the use of quoted market prices for exchange-traded derivatives, or through the use of pricing models for OTC-bilateral and OTC-cleared derivatives. The determination of estimated fair value, when quoted market values are not available, is based on market standard valuation methodologies and inputs that management believes are consistent with what other market participants would use when pricing such instruments. Derivative valuations can be affected by changes in interest rates, foreign currency exchange rates, financial indices, credit spreads, default risk, nonperformance 106 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 10. Fair Value (continued) risk, volatility, liquidity and changes in estimates and assumptions used in the pricing models. The valuation controls and procedures for derivatives are described in "-- Investments." The significant inputs to the pricing models for most OTC-bilateral and OTC-cleared derivatives are inputs that are observable in the market or can be derived principally from, or corroborated by, observable market data. Significant inputs that are observable generally include: interest rates, foreign currency exchange rates, interest rate curves, credit curves and volatility. However, certain OTC-bilateral and OTC-cleared derivatives may rely on inputs that are significant to the estimated fair value that are not observable in the market or cannot be derived principally from, or corroborated by, observable market data. Significant inputs that are unobservable generally include references to emerging market currencies and inputs that are outside the observable portion of the interest rate curve, credit curve, volatility or other relevant market measure. These unobservable inputs may involve significant management judgment or estimation. Even though unobservable, these inputs are based on assumptions deemed appropriate given the circumstances and management believes they are consistent with what other market participants would use when pricing such instruments. Most inputs for OTC-bilateral and OTC-cleared derivatives are mid-market inputs but, in certain cases, liquidity adjustments are made when they are deemed more representative of exit value. Market liquidity, as well as the use of different methodologies, assumptions and inputs, may have a material effect on the estimated fair values of the Company's derivatives and could materially affect net income. The credit risk of both the counterparty and the Company are considered in determining the estimated fair value for all OTC-bilateral and OTC-cleared derivatives, and any potential credit adjustment is based on the net exposure by counterparty after taking into account the effects of netting agreements and collateral arrangements. The Company values its OTC-bilateral and OTC-cleared derivatives using standard swap curves which may include a spread to the risk free rate, depending upon specific collateral arrangements. This credit spread is appropriate for those parties that execute trades at pricing levels consistent with similar collateral arrangements. As the Company and its significant derivative counterparties generally execute trades at such pricing levels and hold sufficient collateral, additional credit risk adjustments are not currently required in the valuation process. The Company's ability to consistently execute at such pricing levels is in part due to the netting agreements and collateral arrangements that are in place with all of its significant derivative counterparties. An evaluation of the requirement to make additional credit risk adjustments is performed by the Company each reporting period. Freestanding Derivatives Level 2 Valuation Techniques and Key Inputs: This level includes all types of derivatives utilized by the Company with the exception of exchange-traded derivatives included within Level 1 and those derivatives with unobservable inputs as described in Level 3. These derivatives are principally valued using the income approach. Interest rate Non-option-based. Valuations are based on present value techniques, which utilize significant inputs that may include the swap yield curve and basis curves. 107 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 10. Fair Value (continued) Option-based. Valuations are based on option pricing models, which utilize significant inputs that may include the swap yield curve, basis curves and interest rate volatility. Foreign currency exchange rate Non-option-based. Valuations are based on present value techniques, which utilize significant inputs that may include the swap yield curve, basis curves, currency spot rates and cross currency basis curves. Credit Non-option-based. Valuations are based on present value techniques, which utilize significant inputs that may include the swap yield curve, credit curves and recovery rates. Equity market Option-based. Valuations are based on option pricing models, which utilize significant inputs that may include the swap yield curve, spot equity index levels, dividend yield curves and equity volatility. Level 3 Valuation Techniques and Key Inputs: These derivatives are principally valued using the income approach. Valuations of non-option-based derivatives utilize present value techniques, whereas valuations of option-based derivatives utilize option pricing models. These valuation methodologies generally use the same inputs as described in the corresponding sections above for Level 2 measurements of derivatives. However, these derivatives result in Level 3 classification because one or more of the significant inputs are not observable in the market or cannot be derived principally from, or corroborated by, observable market data. Interest rate Non-option-based. Significant unobservable inputs may include the extrapolation beyond observable limits of the swap yield curve and basis curves. Foreign currency exchange rate Non-option-based. Significant unobservable inputs may include the extrapolation beyond observable limits of the swap yield curve, basis curves, cross currency basis curves and currency correlation. Credit Non-option-based. Significant unobservable inputs may include credit spreads, repurchase rates and the extrapolation beyond observable limits of the swap yield curve and credit curves. Certain of these derivatives are valued based on independent non-binding broker quotations. 108 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 10. Fair Value (continued) Embedded Derivatives Embedded derivatives principally include certain direct variable annuity guarantees, certain affiliated ceded reinsurance agreements related to such variable annuity guarantees, equity or bond indexed crediting rates within certain funding agreements and those related to ceded funds withheld on reinsurance. Embedded derivatives are recorded at estimated fair value with changes in estimated fair value reported in net income. The Company issues certain variable annuity products with guaranteed minimum benefits. GMWBs, GMABs and certain GMIBs contain embedded derivatives, which are measured at estimated fair value separately from the host variable annuity contract, with changes in estimated fair value reported in net derivative gains (losses). These embedded derivatives are classified within PABs in the consolidated balance sheets. The fair value of these embedded derivatives, estimated as the present value of projected future benefits minus the present value of projected future fees using actuarial and capital market assumptions including expectations concerning policyholder behavior, is calculated by the Company's actuarial department. The calculation is based on in-force business, and is performed using standard actuarial valuation software which projects future cash flows from the embedded derivative over multiple risk neutral stochastic scenarios using observable risk free rates. Capital market assumptions, such as risk free rates and implied volatilities, are based on market prices for publicly traded instruments to the extent that prices for such instruments are observable. Implied volatilities beyond the observable period are extrapolated based on observable implied volatilities and historical volatilities. Actuarial assumptions, including mortality, lapse, withdrawal and utilization, are unobservable and are reviewed at least annually based on actuarial studies of historical experience. The valuation of these guarantee liabilities includes nonperformance risk adjustments and adjustments for a risk margin related to non-capital market inputs. The nonperformance adjustment is determined by taking into consideration publicly available information relating to spreads in the secondary market for MetLife, Inc.'s debt, including related credit default swaps. These observable spreads are then adjusted, as necessary, to reflect the priority of these liabilities and the claims paying ability of the issuing insurance subsidiaries compared to MetLife, Inc. Risk margins are established to capture the non-capital market risks of the instrument which represent the additional compensation a market participant would require to assume the risks related to the uncertainties of such actuarial assumptions as annuitization, premium persistency, partial withdrawal and surrenders. The establishment of risk margins requires the use of significant management judgment, including assumptions of the amount and cost of capital needed to cover the guarantees. These guarantees may be more costly than expected in volatile or declining equity markets. Market conditions including, but not limited to, changes in interest rates, equity indices, market volatility and foreign currency exchange rates; changes in nonperformance risk; and variations in actuarial assumptions regarding policyholder behavior, mortality and risk margins related to non-capital market inputs, may result in significant fluctuations in the estimated fair value of the guarantees that could materially affect net income. The Company ceded the risk associated with certain of the GMIBs, GMABs and GMWBs previously described. In addition to ceding risks associated with guarantees that are accounted for as embedded derivatives, 109 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 10. Fair Value (continued) the Company also ceded directly written GMIBs that are accounted for as insurance (i.e., not as embedded derivatives) but where the reinsurance agreement contains an embedded derivative. These embedded derivatives are included within premiums, reinsurance and other receivables in the consolidated balance sheets with changes in estimated fair value reported in net derivative gains (losses). The value of the embedded derivatives on the ceded risk is determined using a methodology consistent with that described previously for the guarantees directly written by the Company with the exception of the input for nonperformance risk that reflects the credit of the reinsurer. The estimated fair value of the embedded derivatives within funds withheld related to certain ceded reinsurance is determined based on the change in estimated fair value of the underlying assets held by the Company in a reference portfolio backing the funds withheld liability. The estimated fair value of the underlying assets is determined as previously described in "-- Investments -- Securities, Short-term Investments, Long-term Debt and Trading Liabilities." The estimated fair value of these embedded derivatives is included, along with their funds withheld hosts, in other liabilities in the consolidated balance sheets with changes in estimated fair value recorded in net derivative gains (losses). Changes in the credit spreads on the underlying assets, interest rates and market volatility may result in significant fluctuations in the estimated fair value of these embedded derivatives that could materially affect net income. The estimated fair value of the embedded equity and bond indexed derivatives contained in certain funding agreements is determined using market standard swap valuation models and observable market inputs, including a nonperformance risk adjustment. The estimated fair value of these embedded derivatives are included, along with their funding agreements host, within PABs with changes in estimated fair value recorded in net derivative gains (losses). Changes in equity and bond indices, interest rates and the Company's credit standing may result in significant fluctuations in the estimated fair value of these embedded derivatives that could materially affect net income. Embedded Derivatives Within Asset and Liability Host Contracts Level 3 Valuation Techniques and Key Inputs: Direct guaranteed minimum benefits These embedded derivatives are principally valued using the income approach. Valuations are based on option pricing techniques, which utilize significant inputs that may include swap yield curve, currency exchange rates and implied volatilities. These embedded derivatives result in Level 3 classification because one or more of the significant inputs are not observable in the market or cannot be derived principally from, or corroborated by, observable market data. Significant unobservable inputs generally include: the extrapolation beyond observable limits of the swap yield curve and implied volatilities, actuarial assumptions for policyholder behavior and mortality and the potential variability in policyholder behavior and mortality, nonperformance risk and cost of capital for purposes of calculating the risk margin. Reinsurance ceded on certain guaranteed minimum benefits These embedded derivatives are principally valued using the income approach. The valuation techniques and significant market standard unobservable inputs used in their valuation are similar to those described above in "-- Direct Guaranteed Minimum Benefits" and also include counterparty credit spreads. 110 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 10. Fair Value (continued) Embedded Derivatives Within Funds Withheld Related to Certain Ceded Reinsurance These embedded derivatives are principally valued using the income approach. The valuations are based on present value techniques, which utilize significant inputs that may include the swap yield curve and the fair value of assets within the reference portfolio. These embedded derivatives result in Level 3 classification because one or more of the significant inputs are not observable in the market or cannot be derived principally from, or corroborated by, observable market data. Significant unobservable inputs generally include the fair value of certain assets within the reference portfolio which are not observable in the market and cannot be derived principally from, or corroborated by, observable market data. Transfers between Levels Overall, transfers between levels occur when there are changes in the observability of inputs and market activity. Transfers into or out of any level are assumed to occur at the beginning of the period. Transfers between Levels 1 and 2: For assets and liabilities measured at estimated fair value and still held at December 31, 2013, transfers between Levels 1 and 2 were not significant. There were no transfers between Levels 1 and 2 for assets and liabilities measured at estimated fair value and still held at December 31, 2012. Transfers into or out of Level 3: Assets and liabilities are transferred into Level 3 when a significant input cannot be corroborated with market observable data. This occurs when market activity decreases significantly and underlying inputs cannot be observed, current prices are not available, and/or when there are significant variances in quoted prices, thereby affecting transparency. Assets and liabilities are transferred out of Level 3 when circumstances change such that a significant input can be corroborated with market observable data. This may be due to a significant increase in market activity, a specific event, or one or more significant input(s) becoming observable. Transfers into Level 3 for fixed maturity securities and separate account assets were due primarily to a lack of trading activity, decreased liquidity and credit ratings downgrades (e.g., from investment grade to below investment grade) which have resulted in decreased transparency of valuations and an increased use of independent non-binding broker quotations and unobservable inputs, such as illiquidity premiums, delta spread adjustments, or credit spreads. Transfers out of Level 3 for fixed maturity securities and mortgage loans resulted primarily from increased transparency of both new issuances that, subsequent to issuance and establishment of trading activity, became priced by independent pricing services and existing issuances that, over time, the Company was able to obtain pricing from, or corroborate pricing received from, independent pricing services with observable inputs (such as observable spreads used in pricing securities) or increases in market activity and upgraded credit ratings. 111 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 10. Fair Value (continued) Assets and Liabilities Measured at Fair Value Using Significant Unobservable Inputs (Level 3) The following table presents certain quantitative information about the significant unobservable inputs used in the fair value measurement, and the sensitivity of the estimated fair value to changes in those inputs, for the more significant asset and liability classes measured at fair value on a recurring basis using significant unobservable inputs (Level 3) at:
December 31, 2013 ----------------------------- Significant Weighted Valuation Techniques Unobservable Inputs Range Average (1) ------------------------- -------------------------- ---------------- ----------- Fixed maturity securities: (3) U.S. Delta spread corporate adjustments (4) and foreign corporate.... Matrix pricing (10) - 240 38 Illiquidity premium (4) 30 - 30 30 Credit spreads (4) (1,489) - 876 193 Offered quotes (5) 4 - 104 100 Consensus pricing Offered quotes (5) 33 - 140 98 -------------------------------------------------------------------------------------- RMBS.......... Matrix pricing and Credit spreads (4) discounted cash flow (136) - 3,609 286 Market pricing Quoted prices (5) 22 - 100 98 Consensus pricing Offered quotes (5) 69 - 101 93 -------------------------------------------------------------------------------------- CMBS.......... Matrix pricing and Credit spreads (4) discounted cash flow 215 - 2,025 475 Market pricing Quoted prices (5) 89 - 104 99 Consensus pricing Offered quotes (5) 90 - 101 96 -------------------------------------------------------------------------------------- ABS........... Matrix pricing and Credit spreads (4) discounted cash flow 30 - 1,878 119 Market pricing Quoted prices (5) -- - 106 101 Consensus pricing Offered quotes (5) 56 - 106 98 -------------------------------------------------------------------------------------- Foreign Credit spreads (4) government... Matrix pricing Market pricing Quoted prices (5) 77 - 108 87 Consensus pricing Offered quotes (5) 104 - 140 118 Derivatives: Interest rate. Present value Swap yield (7) techniques 401 - 450 -------------------------------------------------------------------------------------- Foreign Swap yield (7) currency Present value exchange rate techniques 580 - 767 Correlation (8) 38% - 47% -------------------------------------------------------------------------------------- Credit........ Present value Credit spreads (9) techniques 98 - 101 Consensus pricing Offered quotes (10) -------------------------------------------------------------------------------------- Embedded derivatives: Direct and Option pricing Mortality rates: ceded techniques Ages 0 - 40 guaranteed minimum benefits..... 0% - 0.10% Ages 41 -60 0.04% - 0.65% Ages 61 -115 0.26% - 100% Lapse rates: Durations 1 -10 0.50% - 100% Durations 11 -20 3% - 100% Durations 21 -116 3% - 100% Utilization rates 20% - 50% Withdrawal rates 0.07% - 10% Long-term equity volatilities 17.40% - 25% Nonperformance risk spread 0.03% - 0.44% --------------------------------------------------------------------------------------
Impact of December 31, 2012 Increase in ----------------------------- Input on Significant Weighted Estimated Valuation Techniques Unobservable Inputs Range Average (1) Fair Value (2) ------------------------- -------------------------- ---------------- ----------- -------------- Fixed maturity securities: (3) U.S. Delta spread corporate adjustments (4) and foreign corporate.... Matrix pricing (50) - 500 84 Decrease Illiquidity premium (4) 30 - 30 30 Decrease Credit spreads (4) (1,416) - 830 285 Decrease Offered quotes (5) -- - 178 139 Increase Consensus pricing Offered quotes (5) 35 - 105 91 Increase ----------------------------------------------------------------------------------------------------- RMBS.......... Matrix pricing and Credit spreads (4) discounted cash flow 9 - 2,980 541 Decrease (6) Market pricing Quoted prices (5) 13 - 100 99 Increase (6) Consensus pricing Offered quotes (5) 28 - 100 75 Increase (6) ----------------------------------------------------------------------------------------------------- CMBS.......... Matrix pricing and Credit spreads (4) discounted cash flow 35 - 4,750 486 Decrease (6) Market pricing Quoted prices (5) 100 - 104 102 Increase (6) Consensus pricing Offered quotes (5) Increase (6) ----------------------------------------------------------------------------------------------------- ABS........... Matrix pricing and Credit spreads (4) discounted cash flow -- - 1,829 105 Decrease (6) Market pricing Quoted prices (5) 40 - 102 99 Increase (6) Consensus pricing Offered quotes (5) -- - 111 97 Increase (6) ----------------------------------------------------------------------------------------------------- Foreign Credit spreads (4) government... Matrix pricing 111 - 111 111 Decrease Market pricing Quoted prices (5) 77 - 101 87 Increase Consensus pricing Offered quotes (5) 82 - 158 130 Increase Derivatives: Interest rate. Present value Swap yield (7) techniques 186 - 332 Increase (11) ----------------------------------------------------------------------------------------------------- Foreign Swap yield (7) currency Present value exchange rate techniques 647 - 795 Increase (11) Correlation (8) 43% - 57% ----------------------------------------------------------------------------------------------------- Credit........ Present value Credit spreads (9) techniques 100 - 100 Decrease (9) Consensus pricing Offered quotes (10) ----------------------------------------------------------------------------------------------------- Embedded derivatives: Direct and Option pricing Mortality rates: ceded techniques Ages 0 - 40 guaranteed minimum benefits..... 0% - 0.10% Decrease (12) Ages 41 -60 0.05% - 0.64% Decrease (12) Ages 61 -115 0.32% - 100% Decrease (12) Lapse rates: Durations 1 -10 0.50% - 100% Decrease (13) Durations 11 -20 3% - 100% Decrease (13) Durations 21 -116 3% - 100% Decrease (13) Utilization rates 20% - 50% Increase (14) Withdrawal rates 0.07% - 10% (15) Long-term equity volatilities 17.40% - 25% Increase (16) Nonperformance risk spread 0.10% - 0.67% Decrease (17) -----------------------------------------------------------------------------------------------------
-------- (1)The weighted average for fixed maturity securities is determined based on the estimated fair value of the securities. 112 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 10. Fair Value (continued) (2)The impact of a decrease in input would have the opposite impact on the estimated fair value. For embedded derivatives, changes to direct guaranteed minimum benefits are based on liability positions and changes to ceded guaranteed minimum benefits are based on asset positions. (3)Significant increases (decreases) in expected default rates in isolation would result in substantially lower (higher) valuations. (4)Range and weighted average are presented in basis points. (5)Range and weighted average are presented in accordance with the market convention for fixed maturity securities of dollars per hundred dollars of par. (6)Changes in the assumptions used for the probability of default is accompanied by a directionally similar change in the assumption used for the loss severity and a directionally opposite change in the assumptions used for prepayment rates. (7)Ranges represent the rates across different yield curves and are presented in basis points. The swap yield curve is utilized among different types of derivatives to project cash flows, as well as to discount future cash flows to present value. Since this valuation methodology uses a range of inputs across a yield curve to value the derivative, presenting a range is more representative of the unobservable input used in the valuation. (8)Ranges represent the different correlation factors utilized as components within the valuation methodology. Presenting a range of correlation factors is more representative of the unobservable input used in the valuation. Increases (decreases) in correlation in isolation will increase (decrease) the significance of the change in valuations. (9)Represents the risk quoted in basis points of a credit default event on the underlying instrument. The range being provided is a single quoted spread in the valuation model. Credit derivatives with significant unobservable inputs are primarily comprised of written credit default swaps. (10)At both December 31, 2013 and 2012, independent non-binding broker quotations were used in the determination of less than 1% of the total net derivative estimated fair value. (11)Changes are based on long U.S. dollar net asset positions and will be inversely impacted for short U.S. dollar net asset positions. (12)Mortality rates vary by age and by demographic characteristics such as gender. Mortality rate assumptions are based on company experience. A mortality improvement assumption is also applied. For any given contract, mortality rates vary throughout the period over which cash flows are projected for purposes of valuing the embedded derivative. (13)Base lapse rates are adjusted at the contract level based on a comparison of the actuarially calculated guaranteed values and the current policyholder account value, as well as other factors, such as the applicability of any surrender charges. A dynamic lapse function reduces the base lapse rate when the guaranteed amount is greater than the account value as in the money contracts are less likely to lapse. Lapse rates are also generally assumed to be lower in periods when a surrender charge applies. For any given contract, lapse rates vary throughout the period over which cash flows are projected for purposes of valuing the embedded derivative. (14)The utilization rate assumption estimates the percentage of contract holders with a GMIB or lifetime withdrawal benefit who will elect to utilize the benefit upon becoming eligible. The rates may vary by the 113 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 10. Fair Value (continued) type of guarantee, the amount by which the guaranteed amount is greater than the account value, the contract's withdrawal history and by the age of the policyholder. For any given contract, utilization rates vary throughout the period over which cash flows are projected for purposes of valuing the embedded derivative. (15)The withdrawal rate represents the percentage of account balance that any given policyholder will elect to withdraw from the contract each year. The withdrawal rate assumption varies by age and duration of the contract, and also by other factors such as benefit type. For any given contract, withdrawal rates vary throughout the period over which cash flows are projected for purposes of valuing the embedded derivative. For GMWBs, any increase (decrease) in withdrawal rates results in an increase (decrease) in the estimated fair value of the guarantees. For GMABs and GMIBs, any increase (decrease) in withdrawal rates results in a decrease (increase) in the estimated fair value. (16)Long-term equity volatilities represent equity volatility beyond the period for which observable equity volatilities are available. For any given contract, long-term equity volatility rates vary throughout the period over which cash flows are projected for purposes of valuing the embedded derivative. (17)Nonperformance risk spread varies by duration and by currency. For any given contract, multiple nonperformance risk spreads will apply, depending on the duration of the cash flow being discounted for purposes of valuing the embedded derivative. The following is a summary of the valuation techniques and significant unobservable inputs used in the fair value measurement of assets and liabilities classified within Level 3 that are not included in the preceding table. Generally, all other classes of securities classified within Level 3, including those within separate account assets and embedded derivatives within funds withheld related to certain ceded reinsurance, use the same valuation techniques and significant unobservable inputs as previously described for Level 3 securities. This includes matrix pricing and discounted cash flow methodologies, inputs such as quoted prices for identical or similar securities that are less liquid and based on lower levels of trading activity than securities classified in Level 2, as well as independent non-binding broker quotations. The residential mortgage loans -- FVO and long-term debt of CSEs -- FVO are valued using independent non-binding broker quotations and internal models including matrix pricing and discounted cash flow methodologies using current interest rates. The sensitivity of the estimated fair value to changes in the significant unobservable inputs for these other assets and liabilities is similar in nature to that described in the preceding table. The valuation techniques and significant unobservable inputs used in the fair value measurement for the more significant assets measured at estimated fair value on a nonrecurring basis and determined using significant unobservable inputs (Level 3) are summarized in "--Nonrecurring Fair Value Measurements." 114 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 10. Fair Value (continued) The following tables summarize the change of all assets and (liabilities) measured at estimated fair value on a recurring basis using significant unobservable inputs (Level 3):
Fair Value Measurements Using Significant Unobservable Inputs (Level 3) ------------------------------------------------------------------------------ Fixed Maturity Securities: ------------------------------------------------------------------------------ U.S. State and U.S. Treasury Foreign Political Foreign Corporate and Agency Corporate RMBS CMBS ABS Subdivision Government --------- ---------- --------- -------- ------ -------- ----------- ---------- (In millions) Year Ended December 31, 2013: Balance at January 1,.................... $ 5,460 $ 71 $ 3,054 $ 1,702 $ 402 $ 1,923 $ -- $ 282 Total realized/unrealized gains (losses) included in: Net income (loss): (1), (2)............. Net investment income................. 2 -- 1 30 (1) -- -- 4 Net investment gains (losses)......... (37) -- (22) (2) -- 4 -- 2 Net derivative gains (losses)......... -- -- -- -- -- -- -- -- OCI..................................... (36) (3) 3 140 2 (27) -- (45) Purchases (3)............................ 1,188 -- 842 1,001 221 1,133 -- 69 Sales (3)................................ (862) (6) (646) (328) (66) (429) -- (37) Issuances (3)............................ -- -- -- -- -- -- -- -- Settlements (3).......................... -- -- -- -- -- -- -- -- Transfers into Level 3 (4)............... 717 -- 250 41 74 1 -- 1 Transfers out of Level 3 (4)............. (1,163) -- (284) (71) (202) (79) -- (2) -------- ----- -------- -------- ------ -------- ----- ------ Balance at December 31,.................. $ 5,269 $ 62 $ 3,198 $ 2,513 $ 430 $ 2,526 $ -- $ 274 ======== ===== ======== ======== ====== ======== ===== ====== Changes in unrealized gains (losses) included in net income (loss): (5) Net investment income................... $ 1 $ -- $ -- $ 35 $ (1) $ -- $ -- $ 4 Net investment gains (losses)........... $ (40) $ -- $ -- $ (3) $ -- $ -- $ -- $ -- Net derivative gains (losses)........... $ -- $ -- $ -- $ -- $ -- $ -- $ -- $ --
115 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 10. Fair Value (continued)
Fair Value Measurements Using Significant Unobservable Inputs (Level 3) -------------------------------------------------------------------------------- Equity Securities: Trading and FVO Securities: ----------------- --------------------------- Non- FVO Residential redeemable Actively General Mortgage Separate Common Preferred Traded Account Short-term Loans - Account Stock Stock Securities Securities Investments FVO Assets (6) ------ ---------- ---------- ---------- ----------- ----------- ---------- (In millions) Year Ended December 31, 2013: Balance at January 1,................... $ 60 $ 281 $ 6 $ 26 $ 252 $ -- $ 940 Total realized/unrealized gains (losses) included in: Net income (loss): (1), (2) Net investment income................. -- -- -- 5 -- 1 -- Net investment gains (losses)......... 20 (30) -- 6 (23) -- 42 Net derivative gains (losses)......... -- -- -- -- -- -- -- OCI.................................... (5) 84 -- -- 19 -- -- Purchases (3)........................... 5 17 9 -- 174 339 185 Sales (3)............................... (31) (74) -- (23) (247) (2) (204) Issuances (3)........................... -- -- -- -- -- -- 72 Settlements (3)......................... -- -- -- -- -- -- -- Transfers into Level 3 (4).............. 1 -- -- -- -- -- 236 Transfers out of Level 3 (4)............ -- -- (3) -- -- -- (62) ----- ------ ----- ----- ------ ------ -------- Balance at December 31,................. $ 50 $ 278 $ 12 $ 14 $ 175 $ 338 $ 1,209 ===== ====== ===== ===== ====== ====== ======== Changes in unrealized gains (losses) included in net income (loss): (5) Net investment income.................. $ -- $ -- $ -- $ 5 $ -- 1 $ -- Net investment gains (losses).......... $ -- $ (17) $ -- $ -- $ 1 -- $ -- Net derivative gains (losses).......... $ -- $ -- $ -- $ -- $ -- -- $ --
116 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 10. Fair Value (continued)
Fair Value Measurements Using Significant Unobservable Inputs (Level 3) ----------------------------------------------------------------------- Net Derivatives: (7) ----------------------------- Foreign Currency Net Interest Exchange Embedded Long-term Long-term Rate Rate Credit Derivatives (8) Debt Debt of CSEs -------- -------- ------ --------------- --------- ------------ (In millions) Year Ended December 31, 2013: Balance at January 1,................... $ 58 $ 37 $ 33 $(109) $ -- $ (44) Total realized/unrealized gains( losses) included in: Net income (loss): (1), (2) Net investment income................. -- -- -- -- -- -- Net investment gains (losses)......... -- -- -- -- -- (2) Net derivative gains (losses)......... (3) (24) (8) 102 -- -- OCI.................................... (44) -- -- -- -- -- Purchases (3)........................... -- -- -- -- -- -- Sales (3)............................... -- -- -- -- -- -- Issuances (3)........................... -- -- (1) -- (43) -- Settlements (3)......................... (12) 1 (1) 55 -- 18 Transfers into Level 3 (4).............. -- -- -- -- -- -- Transfers out of Level 3 (4)............ -- -- -- -- -- -- ----- ----- ----- ------ ------- ------- Balance at December 31,................. $ (1) $ 14 $ 23 $ 48 $ (43) $ (28) ===== ===== ===== ====== ======= ======= Changes in unrealized gains (losses) included in net income (loss): (5) Net investment income.................. $ -- $ -- $ -- $ -- $ -- $ -- Net investment gains (losses).......... $ -- $ -- $ -- $ -- $ -- $ (2) Net derivative gains (losses).......... $ -- $(24) $ (5) $ 115 $ -- $ --
117 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 10. Fair Value (continued)
Fair Value Measurements Using Significant Unobservable Inputs (Level 3) ------------------------------------------------------------------------------ Fixed Maturity Securities: ------------------------------------------------------------------------------ U.S. State and U.S. Treasury Foreign Political Foreign Corporate and Agency Corporate RMBS CMBS ABS Subdivision Government --------- ---------- --------- -------- ------ -------- ----------- ---------- (In millions) Year Ended December 31, 2012: Balance at January 1,................... $ 4,919 $ 25 $ 2,258 $ 691 $ 219 $ 1,146 $ -- $ 291 Total realized/unrealized gains (losses) included in: Net income (loss): (1), (2)............. Net investment income................. 7 -- 6 27 -- 1 -- 5 Net investment gains (losses)......... (2) -- (52) (5) (7) (1) -- (5) Net derivative gains (losses)......... -- -- -- -- -- -- -- -- OCI.................................... 173 -- 142 220 (3) (3) -- 19 Purchases (3)........................... 1,282 47 1,213 892 268 953 -- 2 Sales (3)............................... (848) (1) (489) (242) (167) (157) -- (55) Issuances (3)........................... -- -- -- -- -- -- -- -- Settlements (3)......................... -- -- -- -- -- -- -- -- Transfers into Level 3 (4).............. 559 -- 99 131 104 4 -- 25 Transfers out of Level 3 (4)............ (630) -- (123) (12) (12) (20) -- -- -------- ----- -------- -------- ------ -------- ----- ------ Balance at December 31,................. $ 5,460 $ 71 $ 3,054 $ 1,702 $ 402 $ 1,923 $ -- $ 282 ======== ===== ======== ======== ====== ======== ===== ====== Changes in unrealized gains (losses) included in net income (loss): (5) Net investment income.................. $ 4 $ -- $ 5 $ 27 $ -- $ 1 $ -- $ 5 Net investment gains (losses).......... $ (3) $ -- $ (13) $ (2) $ -- $ -- $ -- $ -- Net derivative gains (losses).......... $ -- $ -- $ -- $ -- $ -- $ -- $ -- $ --
118 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 10. Fair Value (continued)
Fair Value Measurements Using Significant Unobservable Inputs (Level 3) -------------------------------------------------------------------------- Equity Securities: Trading and FVO Securities: ----------------- --------------------------------- Non- FVO redeemable Actively General Residential Separate Common Preferred Traded Account Short-term Mortgage Account Stock Stock Securities Securities Investments Loans - FVO Assets (6) ------ ---------- ---------- ---------- ----------- ----------- ---------- (In millions) Year Ended December 31, 2012: Balance at January 1,......... $ 104 $ 293 $ -- $ 14 $ 134 $ -- $ 1,082 Total realized/unrealized gains (losses) included in: Net income (loss): (1), (2).. Net investment income....... -- -- -- 12 -- -- -- Net investment gains (losses).................. 7 (1) -- -- -- -- 84 Net derivative gains (losses).................. -- -- -- -- -- -- -- OCI.......................... (7) 16 -- -- (19) -- -- Purchases (3)................. 10 5 6 -- 246 -- 171 Sales (3)..................... (24) (32) -- -- (106) -- (379) Issuances (3)................. -- -- -- -- -- -- 2 Settlements (3)............... -- -- -- -- -- -- (1) Transfers into Level 3 (4).... 1 -- -- -- 5 -- 24 Transfers out of Level 3 (4).. (31) -- -- -- (8) -- (43) ------ ------ ----- ----- ------ ----- -------- Balance at December 31,....... $ 60 $ 281 $ 6 $ 26 $ 252 $ -- $ 940 ====== ====== ===== ===== ====== ===== ======== Changes in unrealized gains (losses) included in net income (loss): (5) Net investment income........ $ -- $ -- $ -- $ 12 $ -- $ -- $ -- Net investment gains (losses) $ (4) $ -- $ -- $ -- $ -- $ -- $ -- Net derivative gains (losses) $ -- $ -- $ -- $ -- $ -- $ -- $ --
119 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 10. Fair Value (continued)
Fair Value Measurements Using Significant Unobservable Inputs (Level 3) ------------------------------------------------------------------------ Net Derivatives: (7) ------------------------------------ Foreign Currency Net Interest Exchange Embedded Long-term Rate Rate Credit Derivatives (8) Debt of CSEs -------- -------- ------ --------------- ------------ (In millions) Year Ended December 31, 2012: Balance at January 1,................... $ 67 $ 56 $ 1 $ (790) $ (116) Total realized/unrealized gains (losses) included in: Net income (loss): (1), (2) Net investment income................. -- -- -- -- -- Net investment gains (losses)......... -- -- -- -- (7) Net derivative gains (losses)......... 17 (19) 38 629 -- OCI.................................... (1) -- -- -- -- Purchases (3)........................... -- -- -- -- -- Sales (3)............................... -- -- -- -- -- Issuances (3)........................... -- -- (3) -- -- Settlements (3)......................... (25) -- (3) 52 79 Transfers into Level 3 (4).............. -- -- -- -- -- Transfers out of Level 3 (4)............ -- -- -- -- -- ------ ------ ------ --------- -------- Balance at December 31,................. $ 58 $ 37 $ 33 $ (109) $ (44) ====== ====== ====== ========= ======== Changes in unrealized gains (losses) included in net income (loss): (5) Net investment income.................. $ -- $ -- $ -- $ -- $ -- Net investment gains (losses).......... $ -- $ -- $ -- $ -- $ (7) Net derivative gains (losses).......... $ -- $ (19) $ 36 $ 636 $ --
120 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 10. Fair Value (continued)
Fair Value Measurements Using Significant Unobservable Inputs (Level 3) ------------------------------------------------------------------------------ Fixed Maturity Securities: ------------------------------------------------------------------------------ U.S. State and U.S. Treasury Foreign Political Foreign Corporate and Agency Corporate RMBS CMBS ABS Subdivision Government --------- ---------- --------- -------- ------ -------- ----------- ---------- (In millions) Year Ended December 31, 2011: Balance at January 1,................... $ 5,063 $ 44 $ 2,796 $ 1,985 $ 161 $ 1,514 $ 1 $ 171 Total realized/unrealized gains (losses) included in: Net income (loss): (1), (2)............ Net investment income................. 4 -- 7 10 -- 2 -- 6 Net investment gains (losses)......... (15) -- 16 (10) (1) (12) -- -- Net derivative gains (losses)......... -- -- -- -- -- -- -- -- OCI.................................... 258 2 (24) (52) 28 42 -- 17 Purchases (3)........................... 789 -- 915 78 106 670 -- 118 Sales (3)............................... (653) (1) (1,129) (127) (86) (370) -- (21) Issuances (3)........................... -- -- -- -- -- -- -- -- Settlements (3)......................... -- -- -- -- -- -- -- -- Transfers into Level 3 (4).............. 122 -- 155 -- 11 11 -- -- Transfers out of Level 3 (4)............ (649) (20) (478) (1,193) -- (711) (1) -- -------- ----- -------- -------- ------ -------- ----- ------ Balance at December 31,................. $ 4,919 $ 25 $ 2,258 $ 691 $ 219 $ 1,146 $ -- $ 291 ======== ===== ======== ======== ====== ======== ===== ====== Changes in unrealized gains (losses) included in net income (loss): (5) Net investment income.................. $ 4 $ -- $ 5 $ 11 $ -- $ 2 $ -- $ 5 Net investment gains (losses).......... $ (27) $ -- $ (22) $ (10) $ -- $ (9) $ -- $ -- Net derivative gains (losses).......... $ -- $ -- $ -- $ -- $ -- $ -- $ -- $ --
121 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 10. Fair Value (continued)
Fair Value Measurements Using Significant Unobservable Inputs (Level 3) -------------------------------------------------------------------------- Trading and FVO Equity Securities: Securities: ----------------- --------------------- Non- FVO redeemable Actively General Residential Separate Common Preferred Traded Account Short-term Mortgage Account Stock Stock Securities Securities Investments Loans - FVO Assets (6) ------ ---------- ---------- ---------- ----------- ----------- ---------- (In millions) Year Ended December 31, 2011: Balance at January 1,................... $ 79 $ 633 $ 10 $ 50 $ 379 $ -- $ 1,509 Total realized/unrealized gains (losses) included in: Net income (loss): (1), (2)............ Net investment income................. -- -- -- (6) 1 -- -- Net investment gains (losses)......... 11 (45) -- -- (1) -- 101 Net derivative gains (losses)......... -- -- -- -- -- -- -- OCI.................................... 11 1 -- -- 134 -- -- Purchases (3)........................... 22 2 -- -- (379) -- 188 Sales (3)............................... (20) (298) (8) (30) -- -- (482) Issuances (3)........................... -- -- -- -- -- -- -- Settlements (3)......................... -- -- -- -- -- -- -- Transfers into Level 3 (4).............. 1 -- -- -- -- -- 18 Transfers out of Level 3 (4)............ -- -- (2) -- -- -- (252) ------ ------ ----- ----- ------ ----- -------- Balance at December 31,................. $ 104 $ 293 $ -- $ 14 $ 134 $ -- $ 1,082 ====== ====== ===== ===== ====== ===== ======== Changes in unrealized gains (losses) included in net income (loss): (5) Net investment income.................. $ -- $ -- $ -- $ (6) $ 1 $ -- $ -- Net investment gains (losses).......... $ (6) $ (16) $ -- $ -- $ (1) $ -- $ -- Net derivative gains (losses).......... $ -- $ -- $ -- $ -- $ -- $ -- $ --
122 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 10. Fair Value (continued)
Fair Value Measurements Using Significant Unobservable Inputs (Level 3) ------------------------------------------------------------------------ Net Derivatives: (7) ------------------------------------- Foreign Currency Net Long-term Interest Exchange Embedded Debt of Rate Rate Credit Derivatives (8) CSEs -------- -------- ------- --------------- ---------- (In millions) Year Ended December 31, 2011: Balance at January 1,................... $ (23) $ 46 $ 33 $ (382) $ (184) Total realized/unrealized gains (losses) included in: Net income (loss): (1), (2) Net investment income................. -- -- -- -- -- Net investment gains (losses)......... -- -- -- -- (8) Net derivative gains (losses)......... (7) 10 (33) (458) -- OCI.................................... 130 -- 14 -- -- Purchases (3)........................... -- -- -- -- -- Sales (3)............................... -- -- -- -- -- Issuances (3)........................... -- -- (2) -- -- Settlements (3)......................... (33) -- (11) 50 76 Transfers into Level 3 (4).............. -- -- -- -- -- Transfers out of Level 3 (4)............ -- -- -- -- -- ------- -------- ------- ------------- ---------- Balance at December 31,................. $ 67 $ 56 $ 1 $ (790) $ (116) ======= ======== ======= ============= ========== Changes in unrealized gains (losses) included in net income (loss): (5) Net investment income.................. $ -- $ -- $ -- $ -- $ -- Net investment gains (losses).......... $ -- $ -- $ -- $ -- $ (8) Net derivative gains (losses).......... $ (13) $ 10 $ (32) $ (454) $ --
-------- (1)Amortization of premium/accretion of discount is included within net investment income. Impairments charged to net income (loss) on securities are included in net investment gains (losses). Lapses associated with net embedded derivatives are included in net derivative gains (losses). (2)Interest and dividend accruals, as well as cash interest coupons and dividends received, are excluded from the rollforward. (3)Items purchased/issued and then sold/settled in the same period are excluded from the rollforward. Fees attributed to embedded derivatives are included in settlements. (4)Gains and losses, in net income (loss) and OCI, are calculated assuming transfers into and/or out of Level 3 occurred at the beginning of the period. Items transferred into and then out of Level 3 in the same period are excluded from the rollforward. (5)Changes in unrealized gains (losses) included in net income (loss) relate to assets and liabilities still held at the end of the respective periods. (6)Investment performance related to separate account assets is fully offset by corresponding amounts credited to contractholders within separate account liabilities. Therefore, such changes in estimated fair value are not recorded in net income. For the purpose of this disclosure, these changes are presented within net investment gains (losses). (7)Freestanding derivative assets and liabilities are presented net for purposes of the rollforward. (8)Embedded derivative assets and liabilities are presented net for purposes of the rollforward. 123 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 10. Fair Value (continued) Fair Value Option The following table presents information for residential mortgage loans, which are accounted for under the FVO, and were initially measured at fair value.
December 31, ------------------ 2013 2012 ---------- ------- (In millions) Unpaid principal balance......................................................... $ 508 $ -- Difference between estimated fair value and unpaid principal balance............. (170) -- ---------- ------- Carrying value at estimated fair value (1)...................................... $ 338 $ -- ========== ======= Loans in non-accrual status...................................................... $ -- $ -- Loans more than 90 days past due................................................. $ 81 $ -- Loans in non-accrual status or more than 90 days past due, or both -- difference between aggregate estimated fair value and unpaid principal balance............ $ (82) $ --
-------- (1)Interest income, changes in estimated fair value and gains or losses on sales are recognized in net investment income. Changes in estimated fair value for these loans were due to the following:
Years Ended December 31, ------------------------ 2013 2012 2011 -------- ------- ------- (In millions) Instrument-specific credit risk based on changes in credit spreads for non-agency loans and adjustments in individual loan quality.......... $ (1) $ -- $ -- Other changes in estimated fair value.................................. 1 -- -- -------- ------- ------- Total gains (losses) recognized in net investment income.............. $ -- $ -- $ -- ======== ======= =======
The following table presents information for long-term debt, which is accounted for under the FVO, and was initially measured at fair value.
Long-term Debt Long-term Debt of CSEs ----------------------------------- ----------------------------------- December 31, 2013 December 31, 2012 December 31, 2013 December 31, 2012 ----------------- ----------------- ----------------- ----------------- (In millions) Contractual principal balance..... $ 123 $ -- $ 42 $ 60 Difference between estimated fair value and contractual principal balance......................... (1) -- (14) (16) -------- ------- --------- --------- Carrying value at estimated fair value (1)...................... $ 122 $ -- $ 28 $ 44 ======== ======= ========= =========
-------- (1)Changes in estimated fair value are recognized in net investment gains (losses). Interest expense is recognized in other expenses. 124 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 10. Fair Value (continued) Nonrecurring Fair Value Measurements The following table presents information for assets measured at estimated fair value on a nonrecurring basis during the periods and still held at the reporting dates; that is, they are not measured at fair value on a recurring basis but are subject to fair value adjustments only in certain circumstances (for example, when there is evidence of impairment). The estimated fair values for these assets were determined using significant unobservable inputs (Level 3).
At December 31, Years Ended December 31, -------------------------------- -------------------------- 2013 2012 2011 2013 2012 2011 ------- ------- ------- -------- -------- -------- Carrying Value After Measurement Gains (Losses) -------------------------------- -------------------------- (In millions) Mortgage loans, net (1)................. $ 175 $ 361 $ 143 $ 24 $ (16) $ (25) Other limited partnership interests (2). $ 71 $ 48 $ 8 $ (40) $ (30) $ (3) Real estate joint ventures (3).......... $ 2 $ 8 $ -- $ (1) $ (4) $ -- Goodwill (4)............................ $ -- $ -- $ -- $ -- $ (10) $ --
-------- (1)Estimated fair values for impaired mortgage loans are based on independent broker quotations or valuation models using unobservable inputs or, if the loans are in foreclosure or are otherwise determined to be collateral dependent, are based on the estimated fair value of the underlying collateral or the present value of the expected future cash flows. (2)For these cost method investments, estimated fair value is determined from information provided in the financial statements of the underlying entities including NAV data. These investments include private equity and debt funds that typically invest primarily in various strategies including domestic and international leveraged buyout funds; power, energy, timber and infrastructure development funds; venture capital funds; and below investment grade debt and mezzanine debt funds. Distributions will be generated from investment gains, from operating income from the underlying investments of the funds and from liquidation of the underlying assets of the funds. It is estimated that the underlying assets of the funds will be liquidated over the next two to 10 years. Unfunded commitments for these investments at both December 31, 2013 and 2012 were not significant. (3)For these cost method investments, estimated fair value is determined from information provided in the financial statements of the underlying entities including NAV data. These investments include several real estate funds that typically invest primarily in commercial real estate and mezzanine debt. Distributions will be generated from investment gains, from operating income from the underlying investments of the funds and from liquidation of the underlying assets of the funds. It is estimated that the underlying assets of the funds will be liquidated over the next one to 10 years. Unfunded commitments for these investments at both December 31, 2013 and 2012 were not significant. (4)As discussed in Note 11, in 2012, the Company recorded an impairment of goodwill associated with the Retail Annuities reporting unit. This impairment has been categorized as Level 3 due to the significant unobservable inputs used in the determination of the estimated fair value. 125 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 10. Fair Value (continued) Fair Value of Financial Instruments Carried at Other Than Fair Value The following tables provide fair value information for financial instruments that are carried on the balance sheet at amounts other than fair value. These tables exclude the following financial instruments: cash and cash equivalents, accrued investment income, payables for collateral under securities loaned and other transactions, short-term debt and those short-term investments that are not securities, such as time deposits, and therefore are not included in the three level hierarchy table disclosed in the "-- Recurring Fair Value Measurements" section. The estimated fair value of the excluded financial instruments, which are primarily classified in Level 2 and, to a lesser extent, in Level 1, approximates carrying value as they are short-term in nature such that the Company believes there is minimal risk of material changes in interest rates or credit quality. All remaining balance sheet amounts excluded from the table below are not considered financial instruments subject to this disclosure. The carrying values and estimated fair values for such financial instruments, and their corresponding placement in the fair value hierarchy, are summarized as follows at:
December 31, 2013 -------------------------------------------------------------- Fair Value Hierarchy -------------------------------------------------------------- Carrying Total Estimated Value Level 1 Level 2 Level 3 Fair Value ---------- ----------- ----------- ----------- --------------- (In millions) Assets Mortgage loans: Held-for-investment............... $ 45,683 $ -- $ -- $ 47,366 $ 47,366 Held-for-sale..................... 3 -- -- 3 3 ---------- ------- --------- --------- --------- Mortgage loans, net............. $ 45,686 $ -- $ -- $ 47,369 $ 47,369 Policy loans........................ $ 8,421 $ -- $ 786 $ 8,767 $ 9,553 Real estate joint ventures.......... $ 47 $ -- $ -- $ 70 $ 70 Other limited partnership interests. $ 865 $ -- $ -- $ 1,013 $ 1,013 Other invested assets............... $ 2,017 $ 87 $ 1,752 $ 176 $ 2,015 Premiums, reinsurance and other receivables........................ $ 14,210 $ -- $ 15 $ 14,906 $ 14,921 Liabilities PABs................................ $ 70,205 $ -- $ -- $ 72,236 $ 72,236 Long-term debt...................... $ 2,655 $ -- $ 2,956 $ -- $ 2,956 Other liabilities................... $ 19,601 $ -- $ 310 $ 19,787 $ 20,097 Separate account liabilities........ $ 57,935 $ -- $ 57,935 $ -- $ 57,935
126 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 10. Fair Value (continued)
December 31, 2012 ----------------------------------------------------------------- Fair Value Hierarchy ----------------------------------------------------------------- Carrying Total Estimated Value Level 1 Level 2 Level 3 Fair Value ----------- ----------- ------------- ----------- --------------- (In millions) Assets Mortgage loans: Held-for-investment........... $ 44,657 $ -- $ -- $ 47,365 $ 47,365 Held-for-sale................. -- -- -- -- -- ----------- ----------- ----------- ----------- ----------- Mortgage loans, net......... $ 44,657 $ -- $ -- $ 47,365 $ 47,365 Policy loans.................... $ 8,364 $ -- $ 793 $ 9,470 $ 10,263 Real estate joint ventures...... $ 52 $ -- $ -- $ 68 $ 68 Other limited partnership interests...................... $ 1,048 $ -- $ -- $ 1,161 $ 1,161 Other invested assets........... $ 2,014 $ 93 $ 1,885 $ 152 $ 2,130 Premiums, reinsurance and other receivables.................... $ 14,172 $ -- $ 37 $ 15,129 $ 15,166 Liabilities PABs............................ $ 71,611 $ -- $ -- $ 75,189 $ 75,189 Long-term debt.................. $ 2,276 $ -- $ 2,713 $ -- $ 2,713 Other liabilities............... $ 19,865 $ -- $ 171 $ 20,488 $ 20,659 Separate account liabilities.... $ 51,985 $ -- $ 51,985 $ -- $ 51,985
The methods, assumptions and significant valuation techniques and inputs used to estimate the fair value of financial instruments are summarized as follows: Mortgage Loans Mortgage loans held-for-investment For mortgage loans held-for-investment, estimated fair value is primarily determined by estimating expected future cash flows and discounting them using current interest rates for similar mortgage loans with similar credit risk, or is determined from pricing for similar loans. Mortgage loans held-for-sale For mortgage loans held-for-sale, estimated fair value is determined using independent non-binding broker quotations or internal valuation models using significant unobservable inputs. Policy Loans Policy loans with fixed interest rates are classified within Level 3. The estimated fair values for these loans are determined using a discounted cash flow model applied to groups of similar policy loans determined by the nature of the underlying insurance liabilities. Cash flow estimates are developed by applying a weighted-average interest rate to the outstanding principal balance of the respective group of policy loans and an estimated average maturity determined through experience studies of the past performance of policyholder repayment behavior for similar loans. These cash flows are discounted using current risk-free interest rates with no adjustment for borrower credit risk as these loans are fully collateralized by the cash surrender value of the 127 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 10. Fair Value (continued) underlying insurance policy. Policy loans with variable interest rates are classified within Level 2 and the estimated fair value approximates carrying value due to the absence of borrower credit risk and the short time period between interest rate resets, which presents minimal risk of a material change in estimated fair value due to changes in market interest rates. Real Estate Joint Ventures and Other Limited Partnership Interests The estimated fair values of these cost method investments are generally based on the Company's share of the NAV as provided in the financial statements of the investees. In certain circumstances, management may adjust the NAV by a premium or discount when it has sufficient evidence to support applying such adjustments. Other Invested Assets These other invested assets are principally comprised of loans to affiliates. The estimated fair value of loans to affiliates is determined by discounting the expected future cash flows using market interest rates currently available for instruments with similar terms and remaining maturities. Premiums, Reinsurance and Other Receivables Premiums, reinsurance and other receivables are principally comprised of certain amounts recoverable under reinsurance agreements, amounts on deposit with financial institutions to facilitate daily settlements related to certain derivatives and amounts receivable for securities sold but not yet settled. Amounts recoverable under ceded reinsurance agreements, which the Company has determined do not transfer significant risk such that they are accounted for using the deposit method of accounting, have been classified as Level 3. The valuation is based on discounted cash flow methodologies using significant unobservable inputs. The estimated fair value is determined using interest rates determined to reflect the appropriate credit standing of the assuming counterparty. The amounts on deposit for derivative settlements, classified within Level 2, essentially represent the equivalent of demand deposit balances and amounts due for securities sold are generally received over short periods such that the estimated fair value approximates carrying value. PABs These PABs include investment contracts. Embedded derivatives on investment contracts and certain variable annuity guarantees accounted for as embedded derivatives are excluded from this caption in the preceding tables as they are separately presented in "-- Recurring Fair Value Measurements." The investment contracts primarily include certain funding agreements, fixed deferred annuities, modified guaranteed annuities, fixed term payout annuities and total control accounts. The valuation of these investment contracts is based on discounted cash flow methodologies using significant unobservable inputs. The estimated fair value is determined using current market risk-free interest rates adding a spread to reflect the nonperformance risk in the liability. 128 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 10. Fair Value (continued) Long-term Debt The estimated fair values of long-term debt is principally determined using market standard valuation methodologies. Valuations are based primarily on quoted prices in markets that are not active or using matrix pricing that use standard market observable inputs such as quoted prices in markets that are not active and observable yields and spreads in the market. Instruments valued using discounted cash flow methodologies use standard market observable inputs including market yield curve, duration, observable prices and spreads for similar publicly traded or privately traded issues. Capital leases, which are not required to be disclosed at estimated fair value, and debt carried at fair value are excluded from the preceding tables. Other Liabilities Other liabilities consist primarily of interest payable, amounts due for securities purchased but not yet settled, funds withheld amounts payable, which are contractually withheld by the Company in accordance with the terms of the reinsurance agreements, and amounts payable under certain assumed reinsurance agreements, which are recorded using the deposit method of accounting. The Company evaluates the specific terms, facts and circumstances of each instrument to determine the appropriate estimated fair values, which are not materially different from the carrying values, with the exception of certain deposit type reinsurance payables. For such payables, the estimated fair value is determined as the present value of expected future cash flows, which are discounted using an interest rate determined to reflect the appropriate credit standing of the assuming counterparty. Separate Account Liabilities Separate account liabilities represent those balances due to policyholders under contracts that are classified as investment contracts. Separate account liabilities classified as investment contracts primarily represent variable annuities with no significant mortality risk to the Company such that the death benefit is equal to the account balance, funding agreements related to group life contracts and certain contracts that provide for benefit funding. Since separate account liabilities are fully funded by cash flows from the separate account assets which are recognized at estimated fair value as described in the section "-- Recurring Fair Value Measurements," the value of those assets approximates the estimated fair value of the related separate account liabilities. The valuation techniques and inputs for separate account liabilities are similar to those described for separate account assets. 11. Goodwill Goodwill, which is included in other assets, is the excess of cost over the estimated fair value of net assets acquired. Goodwill is not amortized but is tested for impairment at least annually or more frequently if events or circumstances, such as adverse changes in the business climate, indicate that there may be justification for conducting an interim test. Step 1 of the goodwill impairment process requires a comparison of the fair value of a reporting unit to its carrying value. In performing the Company's goodwill impairment tests, the estimated fair 129 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 11. Goodwill (continued) values of the reporting units are first determined using a market multiple valuation approach. When further corroboration is required, the Company uses a discounted cash flow valuation approach. For reporting units which are particularly sensitive to market assumptions, the Company may use additional valuation methodologies to estimate the reporting units' fair values. The market multiple valuation approach utilizes market multiples of companies with similar businesses and the projected operating earnings of the reporting unit. The discounted cash flow valuation approach requires judgments about revenues, operating earnings projections, capital market assumptions and discount rates. The key inputs, judgments and assumptions necessary in determining estimated fair value of the reporting units include projected operating earnings, current book value, the level of economic capital required to support the mix of business, long-term growth rates, comparative market multiples, the account value of in-force business, projections of new and renewal business, as well as margins on such business, the level of interest rates, credit spreads, equity market levels, and the discount rate that the Company believes is appropriate for the respective reporting unit. The valuation methodologies utilized are subject to key judgments and assumptions that are sensitive to change. Estimates of fair value are inherently uncertain and represent only management's reasonable expectation regarding future developments. These estimates and the judgments and assumptions upon which the estimates are based will, in all likelihood, differ in some respects from actual future results. Declines in the estimated fair value of the Company's reporting units could result in goodwill impairments in future periods which could materially adversely affect the Company's results of operations or financial position. During the 2013 annual goodwill impairment tests, the Company concluded that the fair values of all reporting units were in excess of their carrying values and, therefore, goodwill was not impaired. Information regarding goodwill by segment, as well as Corporate & Other, was as follows:
Group, Voluntary & Corporate Worksite Benefit Corporate Retail Benefits Funding & Other Total --------- ----------- --------- --------- --------- (In millions) Balance at January 1, 2012 Goodwill..................... $ 37 $ 68 $ 2 $ 4 $ 111 Accumulated impairment....... -- -- -- -- -- --------- ------- ------- ------- --------- Total goodwill, net........ $ 37 $ 68 $ 2 $ 4 $ 111 Impairments (1).............. $ (10) $ -- $ -- $ -- $ (10) Balance at December 31, 2012 Goodwill..................... $ 37 $ 68 $ 2 $ 4 $ 111 Accumulated impairment....... (10) -- -- -- (10) --------- ------- ------- ------- --------- Total goodwill, net........ $ 27 $ 68 $ 2 $ 4 $ 101 Balance at December 31, 2013 Goodwill..................... 37 68 2 4 111 Accumulated impairment....... (10) -- -- -- (10) --------- ------- ------- ------- --------- Total goodwill, net........ $ 27 $ 68 $ 2 $ 4 $ 101 ========= ======= ======= ======= =========
-------- (1)For the year ended December 31, 2012, a non-cash charge of $10 million, which had no impact on income taxes, was recorded in other expenses for the impairment of the entire goodwill balance for the Retail Annuities reporting unit. 130 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 12. Long-term and Short-term Debt Long-term and short-term debt outstanding was as follows:
Interest Rates (1) ---------------------- December 31, Weighted ----------------- Range Average Maturity 2013 2012 ------------- -------- ----------- -------- -------- (In millions) Surplus notes -- affiliated.... 3.00% - 7.38% 6.51% 2014 - 2037 $ 1,100 $ 1,099 Surplus notes.................. 7.63% - 7.88% 7.84% 2015 - 2025 701 700 Mortgage loans -- affiliated... 2.12% - 7.26% 5.38% 2015 - 2020 364 306 Senior notes -- affiliated (2). 0.93% - 2.86% 2.07% 2021 - 2022 79 80 Other notes (3)................ 1.39% - 8.00% 3.06% 2014 - 2027 533 91 Capital lease obligations...... 23 25 -------- -------- Total long-term debt (4)....... 2,800 2,301 Total short-term debt.......... 175 100 -------- -------- Total.......................... $ 2,975 $ 2,401 ======== ========
-------- (1)Range of interest rates and weighted average interest rates are for the year ended December 31, 2013. (2)During 2012, a consolidated VIE issued $80 million of long-term debt to an affiliate. See Note 8. (3)The Company consolidated an open ended core real estate fund formed in the fourth quarter of 2013. During 2013, this consolidated VIE issued $373 million of long-term debt. See Note 8. (4)Excludes $28 million and $44 million of long-term debt relating to CSEs at December 31, 2013 and 2012, respectively. See Note 8. The aggregate maturities of long-term debt at December 31, 2013 for the next five years and thereafter are $258 million in 2014, $530 million in 2015, $5 million in 2016, $65 million in 2017, $37 million in 2018 and $1.9 billion thereafter. Capital lease obligations and mortgage loans are collateralized and rank highest in priority, followed by unsecured senior debt which consists of senior notes and other notes. Payments of interest and principal on the Company's surplus notes are subordinate to all other obligations. Payments of interest and principal on surplus notes may be made only with the prior approval of the insurance department of the state of domicile. Certain of the Company's debt instruments, and its credit and committed facilities, contain various administrative, reporting, legal and financial covenants. The Company believes it was in compliance with all such covenants at December 31, 2013. Surplus Notes - Affiliated In April 2011, Metropolitan Life Insurance Company repaid in cash a $775 million surplus note issued to MetLife, Inc., with an original maturity of December 2011. The early redemption was approved by the Superintendent. 131 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 12. Long-term and Short-term (continued) Capital Notes - Affiliated In December 2011, Metropolitan Life Insurance Company repaid in cash $500 million of capital notes issued to MetLife, Inc. Mortgage Loans - Affiliated In December 2011, a wholly-owned real estate subsidiary of the Company issued a mortgage loan for $110 million to MICC. This affiliated mortgage loan is secured by real estate held by the subsidiary for investment. This mortgage loan bears interest at a rate of one-month LIBOR plus 1.95%, which is payable quarterly through maturity in 2015. Short-term Debt Short-term debt with maturities of one year or less was as follows:
December 31, --------------------- 2013 2012 ---------- ---------- (In millions) Commercial paper......... $ 175 $ 100 Average daily balance.... $ 103 $ 119 Average days outstanding. 55 days 40 days
During the years ended December 31, 2013, 2012 and 2011, the weighted average interest rate on short-term debt was 0.12%, 0.17% and 0.16%, respectively. Interest Expense Interest expense related to long-term and short-term debt included in other expenses was $150 million, $148 million and $185 million for the years ended December 31, 2013, 2012 and 2011, respectively. These amounts include $91 million, $89 million and $125 million of interest expense related to affiliated debt for the years ended December 31, 2013, 2012 and 2011, respectively. Such amounts do not include interest expense on long-term debt related to CSEs. See Note 8. Credit and Committed Facilities The Company maintains unsecured credit facilities and a committed facility, which aggregated $4.0 billion and $500 million, respectively, at December 31, 2013. When drawn upon, these facilities bear interest at varying rates in accordance with the respective agreements. Credit Facilities The unsecured credit facilities are used for general corporate purposes, to support the borrowers' commercial paper program and for the issuance of letters of credit. Total fees expensed associated with these credit facilities 132 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 12. Long-term and Short-term (continued) were $3 million, $3 million and $6 million for the years ended December 31, 2013, 2012 and 2011, respectively, and are included in other expenses. Information on these credit facilities at December 31, 2013 was as follows:
Letters of Credit Unused Borrower(s) Expiration Capacity Issued(1) Drawdowns Commitments -------------------------- ------------------ ---------- ---------- --------- ----------- (In millions) MetLife, Inc. and MetLife Funding, Inc............ September 2017 (2) $ 1,000 $ 59 $ -- $ 941 MetLife, Inc. and MetLife Funding, Inc............ August 2016 (3) 3,000 133 -- 2,867 ---------- -------- ------- ---------- Total.................... $ 4,000 $ 192 $ -- $ 3,808 ========== ======== ======= ==========
-------- (1)MetLife, Inc. and MetLife Funding, Inc., a wholly owned subsidiary of Metropolitan Life Insurance Company, are severally liable for their respective obligations under such unsecured credit facilities. MetLife Funding, Inc. is not an applicant under letters of credit outstanding as of December 31, 2013 and is not responsible for any reimbursement obligations under such letters of credit. (2)In September 2012, MetLife, Inc. and MetLife Funding, Inc. entered into a $1.0 billion five-year credit agreement which amended and restated the three-year agreement dated October 2010. All borrowings under the 2012 five-year credit agreement must be repaid by September 2017, except that letters of credit outstanding on that date may remain outstanding until no later than September 2018. The Company incurred costs of $2 million related to the amended and restated credit facility, which have been capitalized and included in other assets. These costs are being amortized over the remaining term of the amended and restated credit facility. (3)In October 2013, availability under the unsecured credit facilities increased by $1.9 billion, as MetLife, Inc. no longer required and therefore canceled $1.9 billion of outstanding letters of credit. See Note 20. Committed Facility The committed facility is used for collateral for certain of the Company's affiliated reinsurance liabilities. Total fees expensed associated with this committed facility were $3 million for each of the years ended December 31, 2013, 2012 and 2011 and are included in other expenses. Information on the committed facility at December 31, 2013 was as follows:
Letters of Credit Unused Account Party/Borrower(s) Expiration Capacity Issued(1) Drawdowns Commitments ------------------------------------------- ---------- -------- --------- --------- ----------- (In millions) Exeter Reassurance Company, Ltd., MetLife, Inc. & Missouri Reinsurance, Inc......... June 2016 $ 500 $ 490 $ -- $ 10
-------- (1)Missouri Reinsurance, Inc., a subsidiary of Metropolitan Life Insurance Company, had outstanding $490 million in letters of credit at December 31, 2013. 133 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 13. Equity Capital Contributions During the year ended December 31, 2011, United MetLife Insurance Company Limited ("United"), an insurance underwriting joint venture of the Company accounted for under the equity method, merged with Sino-US MetLife Insurance Company Limited ("Sino"), another insurance underwriting joint venture of an affiliate of the Company. The Company's ownership interest in the merged entity, Sino-US United MetLife Insurance Company Limited ("Sino-United") was determined based on its contributed capital and share of undistributed earnings of United compared to the contributed capital and undistributed earnings of all other owners of United and Sino. Since both of the joint ventures were under common ownership both prior to and subsequent to the merger, the Company's investment in Sino-United is based on the carrying value of its investment in United. Pursuant to the merger, the Company entered into an agreement whereby the affiliate will pay an amount to the Company based on the relative fair values of their respective investments in Sino-United. Accordingly, upon completion of the estimation of fair value, $47 million, representing a capital contribution, was received during the year ended December 31, 2011. The Company's investment in Sino-United is accounted for under the equity method and is included in other invested assets. During each of the years ended December 31, 2013, 2012 and 2011, MetLife, Inc. contributed $3 million in the form of payment of line of credit fees on the Company's behalf. Stock-Based Compensation Plans Overview The stock-based compensation expense recognized by the Company is related to awards payable in shares of MetLife, Inc. common stock ("Shares"), or options to purchase MetLife, Inc. common stock. The Company does not issue any awards payable in its common stock or options to purchase its common stock. Description of Plans for Employees and Agents -- General Terms The MetLife, Inc. 2000 Stock Incentive Plan, as amended (the "2000 Stock Plan") authorized the granting of awards to employees and agents in the form of options ("Stock Options") to buy Shares that either qualify as incentive Stock Options under Section 422A of the Code or are non-qualified. By December 31, 2009, all awards under the 2000 Stock Plan had either vested or been forfeited. No awards have been made under the 2000 Stock Plan since 2005. Under the MetLife, Inc. 2005 Stock and Incentive Compensation Plan (the "2005 Stock Plan"), awards granted to employees and agents may be in the form of Stock Options, Stock Appreciation Rights, Restricted Stock or Restricted Stock Units, Performance Shares or Performance Share Units, Cash-Based Awards and Stock-Based Awards (each as defined in the 2005 Stock Plan with reference to Shares). The aggregate number of shares authorized for issuance under the 2005 Stock Plan is 68,000,000, plus those shares available but not utilized under the 2000 Stock Plan and those shares utilized under the 2000 Stock Plan that are recovered due to forfeiture of Stock Options. Each share issued under the 2005 Stock Plan in connection with a Stock Option or Stock Appreciation Right reduces the number of Shares remaining for issuance under that plan by one, and each Share issued under the 2005 Stock Plan in connection with awards other than Stock 134 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 13. Equity (continued) Options or Stock Appreciation Rights reduces the number of Shares remaining for issuance under that plan by 1.179 Shares. At December 31, 2013, the aggregate number of Shares remaining available for issuance pursuant to the 2005 Stock Plan was 20,098,440. Stock Option exercises and other awards settled in Shares are satisfied through the issuance of Shares held in treasury by MetLife, Inc. or by the issuance of new Shares. Of MetLife, Inc.'s stock-based compensation expense for the years ended December 31, 2013, 2012, and 2011, 69%, 76% and 70%, respectively, was allocated to the Company. No expense amounts related to stock-based awards to MetLife, Inc. non-management directors were allocated to the Company. This allocation represents substantially all stock-based compensation recognized in the Company's consolidated results of operations. Accordingly, this discussion addresses MetLife, Inc.'s practices for recognizing expense for awards under the 2000 Stock Plan and 2005 Stock Plan (together, the "Incentive Plans"). References to compensation expense in this note refer to the Company's allocated portion of that expense. All other references relevant to awards under the Incentive Plans pertain to all awards under those plans. Compensation expense related to awards under the 2005 Stock Plan is recognized based on the number of awards expected to vest, which represents the awards granted less expected forfeitures over the life of the award, as estimated at the date of grant. Unless a material deviation from the assumed forfeiture rate is observed during the term in which the awards are expensed, any adjustment necessary to reflect differences in actual experience is recognized in the period the award becomes payable or exercisable. Compensation expense related to awards under the 2005 Stock Plan is principally related to the issuance of Stock Options, Performance Shares and Restricted Stock Units. The majority of the awards granted by MetLife, Inc. each year under the 2005 Stock Plan are made in the first quarter of each year. Compensation Expense Related to Stock-Based Compensation The components of compensation expense related to stock-based compensation were as follows:
Years Ended December 31, -------------------------- 2013 2012 2011 -------- -------- -------- (In millions) Stock Options.............. $ 36 $ 52 $ 48 Performance Shares (1)..... 44 53 37 Restricted Stock Units..... 42 22 15 -------- -------- -------- Total compensation expense. $ 122 $ 127 $ 100 ======== ======== ======== Income tax benefit......... $ 43 $ 44 $ 35 ======== ======== ========
-------- (1)Performance Shares expected to vest and the related compensation expenses may be further adjusted by the performance factor most likely to be achieved, as estimated by management, at the end of the performance period. At December 31, 2013, the Company's allocated portion of expense for Stock Options, Performance Shares and Restricted Stock Units was 91%, 48% and 92%, respectively. 135 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 13. Equity (continued) The following table presents MetLife, Inc.'s total unrecognized compensation expense related to stock-based compensation and the expected weighted average period over which these expenses will be recognized at:
December 31, 2013 ------------------------------ Weighted Average Expense Period ------------- ---------------- (In millions) (Years) Stock Options.......... $ 25 1.27 Performance Shares..... $ 61 1.71 Restricted Stock Units. $ 42 1.88
Equity Awards Stock Options Stock Options are the contingent right of award holders to purchase Shares at a stated price for a limited time. All Stock Options have an exercise price equal to the closing price of a Share reported on the New York Stock Exchange on the date of grant, and have a maximum term of 10 years. The vast majority of Stock Options granted have become or will become exercisable at a rate of one-third of each award on each of the first three anniversaries of the grant date. Other Stock Options have become or will become exercisable on the third anniversary of the grant date. Vesting is subject to continued service, except for employees who are retirement eligible and in certain other limited circumstances. A summary of the activity related to Stock Options was as follows:
Weighted Average Remaining Aggregate Shares Under Weighted Average Contractual Intrinsic Option Exercise Price Term Value (1) ------------ ---------------- ----------- ------------- (Years) (In millions) Outstanding at January 1, 2013....................... 35,153,071 $ 40.89 5.50 $ 51 Granted.............................................. 1,310,019 $ 35.96 Exercised............................................ (6,357,522) $ 31.80 Expired.............................................. (183,662) $ 50.46 Forfeited............................................ (170,530) $ 39.86 ------------ Outstanding at December 31, 2013..................... 29,751,376 $ 42.56 5.19 $ 379 ============ ================ =========== ============= Expected to vest at a future date as of December 31, 2013............................................... 29,536,674 $ 42.60 5.16 $ 376 ============ ================ =========== ============= Exercisable at December 31, 2013..................... 22,786,277 $ 43.56 4.32 $ 277 ============ ================ =========== =============
-------- (1)The aggregate intrinsic value was computed using the closing Share price on December 31, 2013 of $53.92 and December 31, 2012 of $32.94, as applicable. 136 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 13. Equity (continued) The fair value of Stock Options is estimated on the date of grant using a binomial lattice model. Significant assumptions used in MetLife, Inc.'s binomial lattice model are further described below. The assumptions include: expected volatility of the price of Shares; risk-free rate of return; dividend yield on Shares; exercise multiple; and the post-vesting termination rate. Expected volatility is based upon an analysis of historical prices of Shares and call options on Shares traded on the open market. MetLife, Inc. uses a weighted-average of the implied volatility for publicly-traded call options with the longest remaining maturity nearest to the money as of each valuation date and the historical volatility, calculated using monthly closing prices of Shares. MetLife, Inc. chose a monthly measurement interval for historical volatility as this interval reflects MetLife, Inc.'s view that employee option exercise decisions are based on longer-term trends in the price of the underlying Shares rather than on daily price movements. The binomial lattice model used by MetLife, Inc. incorporates different risk-free rates based on the imputed forward rates for U.S. Treasury Strips for each year over the contractual term of the option. The table below presents the full range of rates that were used for options granted during the respective periods. Dividend yield is determined based on historical dividend distributions compared to the price of the underlying Shares as of the valuation date and held constant over the life of the Stock Option. The binomial lattice model used by MetLife, Inc. incorporates the contractual term of the Stock Options. The model also factors in expected exercise behavior and a post-vesting termination rate, or the rate at which vested options are exercised or expire prematurely due to termination of employment. From these factors, the model derives an expected life of the Stock Option. The exercise behavior in the model is a multiple that reflects the ratio of exercise price to the strike price of the Stock Option at which holders are expected to exercise. The exercise multiple is derived from actual historical exercise activity. The post-vesting termination rate is determined from actual historical exercise experience and expiration activity under the Incentive Plans. The following table presents the weighted average assumptions, with the exception of risk-free rate, which is expressed as a range, used to determine the fair value of Stock Options issued:
Years Ended December 31, ----------------------------------- 2013 2012 2011 ----------- ----------- ----------- Dividend yield........................................... 2.13% 1.95% 1.65% Risk-free rate of return................................. 0.16%-3.89% 0.21%-4.17% 0.29%-5.51% Expected volatility...................................... 32.98% 35.59% 32.64% Exercise multiple........................................ 1.51 1.58 1.69 Post-vesting termination rate............................ 3.16% 3.14% 3.36% Contractual term (years)................................. 10 10 10 Expected life (years).................................... 7 7 7 Weighted average exercise price of stock options granted. $35.96 $37.91 $45.16 Weighted average fair value of stock options granted..... $9.88 $11.33 $14.27
MetLife, Inc. deducts 35% of the compensation amount of a Stock Option from its income on its tax return. The compensation amount is the price of shares on the date the Stock Option is exercised less the exercise 137 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 13. Equity (continued) price of the Stock Option. This tax benefit is allocated to the subsidiary of MetLife, Inc. that is the current or former employer of the associate, or is or was the principal for the non-employee insurance agent, who exercised the Stock Option. The following table presents a summary of Stock Option exercise activity:
Years Ended December 31, ------------------------- 2013 2012 2011 - -------- -------- ------- (In millions) Total intrinsic value of stock options exercised......... $ 79 $ 29 $ 41 Cash received from exercise of stock options............. $ 202 $ 109 $ 88 Income tax benefit realized from stock options exercised. $ 28 $ 10 $ 13
Performance Shares Performance Shares are units that, if they vest, are multiplied by a performance factor to produce a number of final Performance Shares which are payable in Shares. Performance Shares are accounted for as equity awards, but are not credited with dividend-equivalents for actual dividends paid on Shares during the performance period. Performance Share awards normally vest in their entirety at the end of the three-year performance period. Vesting is subject to continued service, except for employees who are retirement eligible and in certain other limited circumstances. For awards granted prior to the January 1, 2013 - December 31, 2015 performance period, vested Performance Shares are multiplied by a performance factor of 0.0 to 2.0 based on MetLife, Inc.'s adjusted income, total shareholder return, and performance in change in annual net operating earnings and total shareholder return compared to the performance of its competitors, each measured with respect to the applicable three-year performance period or portions thereof. The estimated fair value of Performance Shares is based upon the closing price of a Share on the date of grant, reduced by the present value of estimated dividends to be paid on that stock during the performance period. The performance factor for the January 1, 2010 - December 31, 2012 performance period was 0.92. For the January 1, 2013 - December 31, 2015 performance period, the vested Performance Shares will be multiplied by a performance factor of 0.00 to 1.75. Assuming that MetLife, Inc. has met threshold performance goals related to its adjusted income or total shareholder return, the MetLife, Inc. Compensation Committee will determine the performance factor in its discretion. In doing so, the Compensation Committee may consider MetLife, Inc.'s total shareholder return relative to the performance of its competitors and MetLife, Inc.'s operating return on equity relative to its financial plan. The estimated fair value of Performance Shares will be remeasured each quarter until they become payable. Restricted Stock Units Restricted Stock Units are units that, if they vest, are payable in an equal number of Shares. Restricted Stock Units are accounted for as equity awards and are not credited with dividend-equivalents for dividends paid on Shares. Accordingly, the estimated fair value of Restricted Stock Units is based upon the closing price of Shares on the date of grant, reduced by the present value of estimated dividends to be paid on that stock. 138 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 13. Equity (continued) The vast majority of Restricted Stock Units normally vest in their entirety on the third anniversary of their grant date. Other Restricted Stock Units normally vest in thirds on the first three anniversaries of their grant date, and others vest in their entirety on the fifth anniversary of their grant date. Vesting is subject to continued service, except for employees who are retirement eligible and in certain other limited circumstances. The following table presents a summary of Performance Share and Restricted Stock Unit activity:
Performance Shares Restricted Stock Units ---------------------- ---------------------- Weighted Weighted Average Average Grant Date Grant Date Shares Fair Value Units Fair Value ----------- ---------- --------- ---------- Outstanding at January 1, 2013....................... 4,822,028 $ 36.93 2,080,148 $ 36.55 Granted.............................................. 1,749,212 $ 50.86 2,182,213 $ 32.34 Forfeited............................................ (151,075) $ 40.87 (395,365) $ 33.97 Payable (1).......................................... (1,346,025) $ 32.24 (538,480) $ 33.17 ----------- --------- Outstanding at December 31, 2013..................... 5,074,140 $ 42.86 3,328,516 $ 33.35 =========== ========== ========= ========== Expected to vest at a future date as of December 31, 2013............................................... 5,067,337 $ 38.60 2,995,664 $ 33.34 =========== ========== ========= ==========
-------- (1)Includes both Shares paid and Shares deferred for later payment. Performance Share amounts above represent aggregate initial target awards and do not reflect potential increases or decreases resulting from the performance factor determined after the end of the respective performance periods. At December 31, 2013, the three year performance period for the 2011 Performance Share grants was completed, but the performance factor had not yet been calculated. Included in the immediately preceding table are 1,545,020 outstanding Performance Shares to which the 2011 - 2013 performance factor will be applied. The factor will be determined in the second quarter of 2014. Statutory Equity and Income Each U.S. insurance company's state of domicile imposes risk-based capital ("RBC") requirements that were developed by the National Association of Insurance Commissioners ("NAIC"). Regulatory compliance is determined by a ratio of a company's total adjusted capital, calculated in the manner prescribed by the NAIC ("TAC") to its authorized control level RBC, calculated in the manner prescribed by the NAIC ("ACL RBC"). Companies below specific trigger points or ratios are classified within certain levels, each of which requires specified corrective action. The minimum level of TAC before corrective action commences is twice ACL RBC ("Company Action RBC"). The RBC ratios for Metropolitan Life Insurance Company and each of its insurance subsidiaries were in excess of 400% for all periods presented. The New York State Department of Financial Services issues an annual "Special Considerations" circular letter to New York licensed insurers dictating tests to be performed as part of insurers' year-end asset adequacy testing. The New York State Department of Financial Services issued its 2013 Special Considerations letter on October 31, 2013. The letter mandates the use of certain assumptions in the 2013 asset adequacy testing. Metropolitan Life Insurance Company will grade in over three years the amount of LTC reserves required as a result of the new assumptions. Under this grade-in, Metropolitan Life Insurance Company increased its asset 139 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 13. Equity (continued) adequacy reserves for LTC policies by $300 million as of December 31, 2013 and will increase such reserves by approximately $200 million and $100 million as of December 31, 2014 and 2015, respectively. The actual 2014 and 2015 amounts may differ from current estimates due to changes in economic conditions, regulation, or policyholder behavior. Metropolitan Life Insurance Company and its insurance subsidiaries prepare statutory-basis financial statements in accordance with statutory accounting practices prescribed or permitted by the insurance department of their respective state of domicile. The NAIC has adopted the Codification of Statutory Accounting Principles ("Statutory Codification"). Statutory Codification is intended to standardize regulatory accounting and reporting to state insurance departments. However, statutory accounting principles continue to be established by individual state laws and permitted practices. Modifications by the various state insurance departments may impact the effect of Statutory Codification on the statutory capital and surplus of Metropolitan Life Insurance Company and its insurance subsidiaries. Statutory accounting principles differ from GAAP primarily by charging policy acquisition costs to expense as incurred, establishing future policy benefit liabilities using different actuarial assumptions, reporting surplus notes as surplus instead of debt, reporting of reinsurance agreements and valuing securities on a different basis. In addition, certain assets are not admitted under statutory accounting principles and are charged directly to surplus. The most significant assets not admitted by the Company are net deferred income tax assets resulting from temporary differences between statutory accounting principles basis and tax basis not expected to reverse and become recoverable within three years. Statutory net income (loss) of Metropolitan Life Insurance Company, a New York domiciled insurer was $369 million, $1.3 billion and $2.0 billion for the years ended December 31, 2013, 2012 and 2011, respectively. Statutory capital and surplus was $12.4 billion and $14.3 billion at December 31, 2013 and 2012, respectively. All such amounts are derived from the statutory-basis financial statements as filed with the New York State Department of Financial Services. Statutory net income (loss) of New England Life Insurance Company ("NELICO"), a Massachusetts domiciled insurer, was $103 million, $79 million and $63 million for the years ended December 31, 2013, 2012 and 2011, respectively. Statutory capital and surplus was $571 million and $539 million at December 31, 2013 and 2012, respectively. All such amounts are derived from the statutory-basis financial statements as filed with the Massachusetts State Division of Insurance. Statutory net income (loss) of GALIC, a Missouri domiciled insurer, was $60 million, $19 million and $128 million for the years ended December 31, 2013, 2012 and 2011, respectively. Statutory capital and surplus was $818 million and $873 million at December 31, 2013 and 2012, respectively. All such amounts are derived from the statutory-basis financial statements as filed with the Missouri State Department of Insurance. Dividend Restrictions Under New York State Insurance Law, Metropolitan Life Insurance Company is permitted, without prior insurance regulatory clearance, to pay stockholder dividends to MetLife, Inc. as long as the aggregate amount of all such dividends in any calendar year does not exceed the lesser of: (i) 10% of its surplus to policyholders as of the end of the immediately preceding calendar year or (ii) its statutory net gain from operations for the immediately preceding calendar year (excluding realized capital gains). Metropolitan Life Insurance Company will be permitted 140 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 13. Equity (continued) to pay a dividend to MetLife, Inc. in excess of the lesser of such two amounts only if it files notice of its intention to declare such a dividend and the amount thereof with the New York Superintendent of Financial Services (the "Superintendent") and the Superintendent either approves the distribution of the dividend or does not disapprove the dividend within 30 days of its filing. Under New York State Insurance Law, the Superintendent has broad discretion in determining whether the financial condition of a stock life insurance company would support the payment of such dividends to its stockholders. During the years ended December 31, 2013 and 2012, Metropolitan Life Insurance Company paid a dividend of $1.4 billion and $1.0 billion, respectively. During the year ended December 31, 2011, Metropolitan Life Insurance Company paid a dividend of $1.3 billion, of which $170 million was a transfer of securities. Based on amounts at December 31, 2013, Metropolitan Life Insurance Company could pay a stockholder dividend in 2014 of $1.1 billion without prior approval of the Superintendent. Under Massachusetts State Insurance Law, NELICO is permitted, without prior insurance regulatory clearance, to pay a stockholder dividend to Metropolitan Life Insurance Company as long as the aggregate amount of the dividend, when aggregated with all other dividends paid in the preceding 12 months, does not exceed the greater of: (i) 10 % of its surplus to policyholders as of the end of the immediately preceding calendar year; or (ii) its statutory net gain from operations for the immediately preceding calendar year. NELICO will be permitted to pay a dividend to Metropolitan Life Insurance Company in excess of the greater of such two amounts only if it files notice of the declaration of such a dividend and the amount thereof with the Massachusetts Commissioner of Insurance (the "Massachusetts Commissioner") and the Massachusetts Commissioner either approves the distribution of the dividend or does not disapprove the distribution within 30 days of its filing. In addition, any dividend that exceeds earned surplus (defined as "unassigned funds (surplus)") as of the last filed annual statutory statement requires insurance regulatory approval. Under Massachusetts State Insurance Law, the Massachusetts Commissioner has broad discretion in determining whether the financial condition of a stock life insurance company would support the payment of such dividends to its stockholders. During the years ended December 31, 2013, 2012 and 2011, NELICO paid a dividend of $77 million, $46 million and $107 million, respectively. Based on amounts at December 31, 2013, NELICO could pay a stockholder dividend in 2014 of $102 million without prior approval of the Massachusetts Commissioner. Under Missouri State Insurance Law, GALIC is permitted, without prior insurance regulatory clearance, to pay a stockholder dividend to Metropolitan Life Insurance Company as long as the amount of such dividend when aggregated with all other dividends in the preceding 12 months, does not exceed the greater of: (i) 10% of its surplus to policyholders as of the end of the immediately preceding calendar year; or (ii) its statutory net gain from operations for the immediately preceding calendar year (excluding net realized capital gains). GALIC will be permitted to pay a dividend to Metropolitan Life Insurance Company in excess of the greater of such two amounts only if it files notice of the declaration of such a dividend and the amount thereof with the Missouri Director of Insurance (the "Missouri Director") and the Missouri Director either approves the distribution of the dividend or does not disapprove the distribution within 30 days of its filing. In addition, any dividend that exceeds earned surplus (defined by the Company as "unassigned funds (surplus)") as of the last filed annual statutory statement requires insurance regulatory approval. Under Missouri State Insurance Law, the Missouri Director has broad discretion in determining whether the financial condition of a stock life insurance company would support the payment of such dividends to its stockholders. During the years ended December 31, 2013 and 2012, GALIC did not pay dividends to Metropolitan Life Insurance Company. During the year ended December 31, 2011, GALIC paid an extraordinary cash dividend to GenAmerica Financial, LLC ("GenAmerica"), its former parent, of $183 million and GenAmerica subsequently paid an ordinary dividend to Metropolitan Life Insurance Company of $183 million. Based on amounts at December 31, 2013, GALIC could pay a stockholder dividend in 2014 of $81 million without prior approval of the Missouri Director. 141 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 13. Equity (continued) For the years ended December 31, 2013, 2012 and 2011, Metropolitan Life Insurance Company received dividends from non-insurance subsidiaries of $45 million, $87 million and $518 million, respectively. Accumulated Other Comprehensive Income (Loss) Information regarding changes in the balances of each component of AOCI attributable to Metropolitan Life Insurance Company, net of income tax, was as follows:
Unrealized Foreign Defined Investment Gains Unrealized Currency Benefit (Losses), Net of Gains (Losses) Translation Plans Related Offsets (1) on Derivatives Adjustments Adjustment Total ------------------- -------------- ----------- ---------- -------- (In millions) Balance at December 31, 2010............ $ 2,360 $ 58 $ 34 $ (1,429) $ 1,023 OCI before reclassifications............ 2,602 1,231 6 (545) 3,294 Income tax expense (benefit)............ (911) (430) (3) 202 (1,142) ------------ -------- ------- ---------- -------- OCI before reclassifications, net of income tax........................... 4,051 859 37 (1,772) 3,175 Amounts reclassified from AOCI.......... (35) (28) -- (126) (189) Income tax expense (benefit)............ 12 9 -- 47 68 ------------ -------- ------- ---------- -------- Amounts reclassified from AOCI, net of income tax........................... (23) (19) -- (79) (121) ------------ -------- ------- ---------- -------- Balance at December 31, 2011............ $ 4,028 $ 840 $ 37 $ (1,851) $ 3,054 OCI before reclassifications............ 2,406 (243) (30) (618) 1,515 Income tax expense (benefit)............ (843) 87 11 217 (528) ------------ -------- ------- ---------- -------- OCI before reclassifications, net of income tax........................... 5,591 684 18 (2,252) 4,041 Amounts reclassified from AOCI.......... 96 2 -- (148) (50) Income tax expense (benefit)............ (33) (1) -- 51 17 ------------ -------- ------- ---------- -------- Amounts reclassified from AOCI, net of income tax........................... 63 1 -- (97) (33) ------------ -------- ------- ---------- -------- Balance at December 31, 2012............ $ 5,654 $ 685 $ 18 $ (2,349) $ 4,008 OCI before reclassifications............ (3,321) (677) 22 1,396 (2,580) Income tax expense (benefit)............ 1,145 237 (9) (490) 883 ------------ -------- ------- ---------- -------- OCI before reclassifications, net of income tax........................... 3,478 245 31 (1,443) 2,311 Amounts reclassified from AOCI.......... (16) (14) -- (205) (235) Income tax expense (benefit)............ 6 5 -- 71 82 ------------ -------- ------- ---------- -------- Amounts reclassified from AOCI, net of income tax........................... (10) (9) -- (134) (153) ------------ -------- ------- ---------- -------- Balance at December 31, 2013............ $ 3,468 $ 236 $ 31 $ (1,577) $ 2,158 ============ ======== ======= ========== ========
-------- (1)See Note 8 for information on offsets to investments related to insurance liabilities, DAC and VOBA and the policyholder dividend obligation. 142 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 13. Equity (continued) Information regarding amounts reclassified out of each component of AOCI, was as follows:
Statement of Operations and AOCI Components Amounts Reclassified from AOCI Comprehensive Income (Loss) Location ------------------------------------------------ ------------------------------- ------------------------------------ Years Ended December 31 ------------------------------- 2013 2012 2011 ---------- --------- ---------- (In millions) Net unrealized investment gains (losses): Net unrealized investment gains (losses)....... $ 38 $ (158) $ (116) Other net investment gains (losses) Net unrealized investment gains (losses)....... 53 56 40 Net investment income Net unrealized investment gains (losses)....... (28) (16) 94 Net derivative gains (losses) OTTI........................................... (47) 22 17 OTTI on fixed maturity securities ---------- --------- ---------- Net unrealized investment gains (losses), before income tax............................ 16 (96) 35 Income tax (expense) benefit.................. (6) 33 (12) ---------- --------- ---------- Net unrealized investment gains (losses), net of income tax............................ $ 10 $ (63) $ 23 ========== ========= ========== Unrealized gains (losses) on derivatives - cash flow hedges: Interest rate swaps............................ $ 20 $ 3 $ -- Net derivative gains (losses) Interest rate swaps............................ 8 4 1 Net investment income Interest rate forwards......................... 1 -- 22 Net derivative gains (losses) Interest rate forwards......................... 2 2 2 Net investment income Foreign currency swaps......................... (15) (7) 7 Net derivative gains (losses) Foreign currency swaps......................... (3) (5) (5) Net investment income Credit forwards................................ -- -- 1 Net derivative gains (losses) Credit forwards................................ 1 1 -- Net investment income ---------- --------- ---------- Gains (losses) on cash flow hedges, before income tax................................... 14 (2) 28 Income tax (expense) benefit.................. (5) 1 (9) ---------- --------- ---------- Gains (losses) on cash flow hedges, net of income tax................................... $ 9 $ (1) $ 19 ========== ========= ========== Defined benefit plans adjustment: (1) Amortization of net actuarial gains (losses)... $ 274 $ 246 $ 231 Amortization of prior service (costs) credit... (69) (98) (105) ---------- --------- ---------- Amortization of defined benefit plan items, before income tax............................ 205 148 126 Income tax (expense) benefit.................. (71) (51) (47) ---------- --------- ---------- Amortization of defined benefit plan items, net of income tax............................ $ 134 $ 97 $ 79 ========== ========= ========== Total reclassifications, net of income tax....... $ 153 $ 33 $ 121 ========== ========= ==========
-------- (1)These AOCI components are included in the computation of net periodic benefit costs. See Note 15. 143 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 14. Other Expenses Information on other expenses was as follows:
Years Ended December 31, -------------------------- 2013 2012 2011 -------- -------- -------- (In millions) Compensation............................................... $ 2,392 $ 2,426 $ 2,260 Pension, postretirement and postemployment benefit costs... 364 285 330 Commissions................................................ 781 769 724 Volume-related costs....................................... 253 241 196 Affiliated interest costs on ceded and assumed reinsurance. 1,033 1,209 1,393 Capitalization of DAC...................................... (562) (632) (724) Amortization of DAC and VOBA............................... 261 991 875 Interest expense on debt and debt issuance costs........... 153 152 194 Premium taxes, licenses and fees........................... 263 294 302 Professional services...................................... 989 946 832 Rent and related expenses, net of sublease income.......... 143 123 129 Other...................................................... (82) (410) (40) -------- -------- -------- Total other expenses..................................... $ 5,988 $ 6,394 $ 6,471 ======== ======== ========
Capitalization of DAC and Amortization of DAC and VOBA See Note 5 for additional information on DAC and VOBA including impacts of capitalization and amortization. See also Note 7 for a description of the DAC amortization impact associated with the closed block. Interest Expense on Debt and Debt Issuance Costs Interest expense on debt and debt issuance costs includes interest expense (see Note 12) and interest expense related to CSEs. See Note 8. Affiliated Expenses Commissions, capitalization of DAC and amortization of DAC and VOBA include the impact of affiliated reinsurance transactions. See Notes 6, 12 and 19 for a discussion of affiliated expenses included in the table above. Restructuring Charges MetLife, Inc. commenced in 2012 an enterprise-wide strategic initiative. This global strategy focuses on leveraging MetLife, Inc. and its subsidiaries' scale to improve the value they provide to customers and shareholders in order to reduce costs, enhance revenues, achieve efficiencies and reinvest in their technology, platforms and functionality to improve their current operations and develop new capabilities. 144 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 14. Other Expenses (continued) These restructuring charges are included in other expenses. As the expenses relate to an enterprise-wide initiative, they are reported in Corporate & Other. Estimated restructuring costs may change as management continues to execute this enterprise-wide strategic initiative. Such restructuring charges which were allocated to the Company were as follows:
Years Ended December 31, ----------------------------------------------------------------- 2013 2012 -------------------------------- -------------------------------- Lease and Asset Lease and Asset Severance Impairment Total Severance Impairment Total --------- --------------- ------ --------- --------------- ------ (In millions) Balance at January 1,................ $ 22 $ -- $ 22 $ -- $ -- $ -- Restructuring charges................ 87 16 103 101 18 119 Cash payments........................ (70) (10) (80) (79) (18) (97) ------ ----- ------ ------ ----- ------ Balance at December 31,.............. $ 39 $ 6 $ 45 $ 22 $ -- $ 22 ====== ===== ====== ====== ===== ====== Total restructuring charges incurred since inception of initiative...... $ 188 $ 34 $ 222 $ 101 $ 18 $ 119 ====== ===== ====== ====== ===== ======
Management anticipates further restructuring charges including severance, as well as lease and asset impairments, through the year ending December 31, 2015. However, such restructuring plans were not sufficiently developed to enable MetLife, Inc. to make an estimate of such restructuring charges at December 31, 2013. 15. Employee Benefit Plans Pension and Other Postretirement Benefit Plans The Company sponsors and administers various U.S. qualified and non-qualified defined benefit pension plans and other postretirement employee benefit plans covering employees and sales representatives who meet specified eligibility requirements. Pension benefits are provided utilizing either a traditional formula or cash balance formula. The traditional formula provides benefits based upon years of credited service and final average earnings. The cash balance formula utilizes hypothetical or notional accounts which credit participants with benefits equal to a percentage of eligible pay, as well as earnings credits, determined annually based upon the average annual rate of interest on 30-year U.S. Treasury securities, for each account balance. At December 31, 2013, the majority of active participants were accruing benefits under the cash balance formula; however, 90% of the Company's obligations result from benefits calculated with the traditional formula. The non-qualified pension plans provide supplemental benefits in excess of limits applicable to a qualified plan. Participating affiliates are allocated a proportionate share of net expense related to the plans as well as contributions made to the plans. The Company also provides certain postemployment benefits and certain postretirement medical and life insurance benefits for retired employees. Employees of the Company who were hired prior to 2003 (or, in certain cases, rehired during or after 2003) and meet age and service criteria while working for the Company may become eligible for these other postretirement benefits, at various levels, in accordance with the applicable plans. Virtually all retirees, or their beneficiaries, contribute a portion of the total costs of postretirement medical benefits. Employees hired after 2003 are not eligible for any employer subsidy for postretirement medical benefits. Participating affiliates are allocated a proportionate share of net expense and contributions related to the postemployment and other postretirement plans. 145 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 15. Employee Benefit Plans (continued) Obligations and Funded Status
Other Pension Postretirement Benefits (1) Benefits ------------------ ------------------ December 31, -------------------------------------- 2013 2012 2013 2012 -------- -------- -------- -------- (In millions) Change in benefit obligations: Benefit obligations at January 1,............................. $ 8,937 $ 7,867 $ 2,402 $ 2,106 Service costs................................................ 214 197 20 36 Interest costs............................................... 367 384 92 103 Plan participants' contributions............................. -- -- 30 29 Net actuarial (gains) losses................................. (967) 944 (550) 261 Plan amendments, change in benefits, and other............... 26 -- -- -- Benefits paid................................................ (447) (455) (133) (133) -------- -------- -------- -------- Benefit obligations at December 31,........................... 8,130 8,937 1,861 2,402 -------- -------- -------- -------- Change in plan assets: Fair value of plan assets at January 1,....................... 7,390 6,699 1,320 1,240 Actual return on plan assets................................. (20) 695 57 105 Plan amendments, change in benefits, and other............... 28 -- -- -- Plan participants' contributions............................. -- -- 30 29 Employer contributions....................................... 354 451 78 79 Benefits paid................................................ (447) (455) (133) (133) -------- -------- -------- -------- Fair value of plan assets at December 31,..................... 7,305 7,390 1,352 1,320 -------- -------- -------- -------- Over (under) funded status at December 31,................... $ (825) $ (1,547) $ (509) $ (1,082) ======== ======== ======== ======== Amounts recognized in the consolidated balance sheets consist of: Other assets................................................. $ 213 $ -- $ -- $ -- Other liabilities............................................ (1,038) (1,547) (509) (1,082) -------- -------- -------- -------- Net amount recognized...................................... $ (825) $ (1,547) $ (509) $ (1,082) ======== ======== ======== ======== AOCI: Net actuarial (gains) losses................................. $ 2,207 $ 2,918 $ 209 $ 796 Prior service costs (credit)................................. 17 23 1 (74) -------- -------- -------- -------- AOCI, before income tax.................................... $ 2,224 $ 2,941 $ 210 $ 722 ======== ======== ======== ======== Accumulated benefit obligation................................ $ 7,689 $ 8,381 N/A N/A ======== ========
-------- (1)Includes non-qualified unfunded plans, for which the aggregate projected benefit obligation was $1.0 billion and $1.1 billion at December 31, 2013 and 2012, respectively. 146 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 15. Employee Benefit Plans (continued) The aggregate pension accumulated benefit obligation and aggregate fair value of plan assets for pension benefit plans with accumulated benefit obligations in excess of plan assets was as follows:
December 31, ----------------- 2013 2012 -------- -------- (In millions) Projected benefit obligations... $ 1,037 $ 1,282 Accumulated benefit obligations. $ 927 $ 1,127 Fair value of plan assets....... $ -- $ 123
Information for pension and other postretirement benefit plans with a projected benefit obligation in excess of plan assets were as follows:
Other Pension Postretirement Benefits Benefits ----------------- ----------------- December 31, ----------------------------------- 2013 2012 2013 2012 -------- -------- -------- -------- (In millions) Projected benefit obligations. $ 1,170 $ 8,937 $ 1,863 $ 2,402 Fair value of plan assets..... $ 133 $ 7,390 $ 1,353 $ 1,320
Net Periodic Benefit Costs Net periodic benefit costs are determined using management estimates and actuarial assumptions to derive service costs, interest costs and expected return on plan assets for a particular year. Net periodic benefit costs also includes the applicable amortization of net actuarial gains (losses) and amortization of any prior service costs (credit). The obligations and expenses associated with these plans require an extensive use of assumptions such as the discount rate, expected rate of return on plan assets, rate of future compensation increases, healthcare cost trend rates, as well as assumptions regarding participant demographics such as rate and age of retirements, withdrawal rates and mortality. Management, in consultation with its external consulting actuarial firms, determines these assumptions based upon a variety of factors such as historical performance of the plan and its assets, currently available market and industry data and expected benefit payout streams. The assumptions used may differ materially from actual results due to, among other factors, changing market and economic conditions and changes in participant demographics. These differences may have a significant effect on the Company's consolidated financial statements and liquidity. Net periodic pension costs and net periodic other postretirement benefit plan costs are comprised of the following: . Service Costs -- Service costs are the increase in the projected (expected) PBO resulting from benefits payable to employees of the Company on service rendered during the current year. . Interest Costs -- Interest costs are the time value adjustment on the projected (expected) PBO at the end of each year. 147 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 15. Employee Benefit Plans (continued) . Settlement and Curtailment Costs -- The aggregate amount of net gains (losses) recognized in net periodic benefit costs due to settlements and curtailments. Settlements result from actions that relieve/eliminate the plan's responsibility for benefit obligations or risks associated with the obligations or assets used for the settlement. Curtailments result from an event that significantly reduces/eliminates plan participants' expected years of future services or benefit accruals. . Expected Return on Plan Assets -- Expected return on plan assets is the assumed return earned by the accumulated pension and other postretirement fund assets in a particular year. . Amortization of Net Actuarial Gains (Losses) -- Actuarial gains and losses result from differences between the actual experience and the expected experience on pension and other postretirement plan assets or projected (expected) PBO during a particular period. These gains and losses are accumulated and, to the extent they exceed 10% of the greater of the PBO or the fair value of plan assets, the excess is amortized into pension and other postretirement benefit costs over the expected service years of the employees. . Amortization of Prior Service Costs (Credit) -- These costs relate to the recognition of increases or decreases in pension and other postretirement benefit obligation due to amendments in plans or initiation of new plans. These increases or decreases in obligation are recognized in AOCI at the time of the amendment. These costs are then amortized to pension and other postretirement benefit costs over the expected service years of the employees affected by the change. The Company's proportionate share of components of net periodic benefit costs and other changes in plan assets and benefit obligations recognized in OCI were as follows:
Pension Benefits Other Postretirement Benefits ----------------------- ----------------------------- Years Ended December 31, ----------------------------------------------------- 2013 2012 2011 2013 2012 2011 ------- ------- ------- ------ ------ ------ (In millions) Net periodic benefit costs: Service costs......................................... $ 209 $ 190 $ 165 $ 17 $ 30 $ 16 Interest costs........................................ 359 374 384 85 95 107 Expected return on plan assets........................ (447) (448) (423) (74) (75) (76) Amortization of net actuarial (gains) losses.......... 213 182 189 51 52 42 Amortization of prior service costs (credit).......... 6 6 3 (69) (95) (108) ------- ------- ------- ------ ------ ------ Total net periodic benefit costs (credit)........... 340 304 318 10 7 (19) ------- ------- ------- ------ ------ ------ Other changes in plan assets and benefit obligations recognized in OCI: Net actuarial (gains) losses.......................... (492) 705 532 (532) 232 264 Prior service costs (credit).......................... -- -- 18 -- -- -- Amortization of net actuarial gains (losses).......... (219) (189) (189) (55) (57) (42) Amortization of prior service (costs) credit.......... (6) (6) (3) 75 104 108 ------- ------- ------- ------ ------ ------ Total recognized in OCI............................. (717) 510 358 (512) 279 330 ------- ------- ------- ------ ------ ------ Total recognized in net periodic benefit costs and OCI......................................... $ (377) $ 814 $ 676 $(502) $ 286 $ 311 ======= ======= ======= ====== ====== ======
148 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 15. Employee Benefit Plans (continued) For the year ended December 31, 2013, included within OCI were other changes in plan assets and benefit obligations associated with pension benefits of ($717) million and other postretirement benefits of ($512) million for an aggregate increase in OCI of $1.2 billion before income tax and $798 million, net of income tax. The estimated net actuarial (gains) losses and prior service costs (credit) for the pension plans and the defined benefit other postretirement benefit plans that will be amortized from AOCI into net periodic benefit costs over the next year are $147 million and $4 million, and $6 million and ($1) million, respectively. Assumptions Assumptions used in determining benefit obligations were as follows:
Pension Benefits Other Postretirement Benefits -------------------------- ------------------------------ December 31, ---------------------------------------------------------- 2013 2012 2013 2012 ------------ ------------ ---- ---- Weighted average discount rate. 5.15% 4.20% 5.15% 4.20% Rate of compensation increase.. 3.50% - 7.50% 3.50% - 7.50% N/A N/A
Assumptions used in determining net periodic benefit costs were as follows:
Pension Benefits Other Postretirement Benefits ----------------------------------------- ----------------------------- December 31, ---------------------------------------------------------------------- 2013 2012 2011 2013 2012 2011 ------------- ------------- ------------- ----- ---- ---- Weighted average discount rate.... 4.20% 4.95% 5.80% 4.20% 4.95% 5.80% Weighted average expected rate of return on plan assets........... 6.24% 7.00% 7.25% 5.76% 6.26% 7.25% Rate of compensation increase..... 3.50% - 7.50% 3.50% - 7.50% 3.50% - 7.50% N/A N/A N/A
The weighted average discount rate is determined annually based on the yield, measured on a yield to worst basis, of a hypothetical portfolio constructed of high quality debt instruments available on the valuation date, which would provide the necessary future cash flows to pay the aggregate projected benefit obligation when due. The weighted average expected rate of return on plan assets is based on anticipated performance of the various asset sectors in which the plan invests, weighted by target allocation percentages. Anticipated future performance is based on long-term historical returns of the plan assets by sector, adjusted for the Company's long-term expectations on the performance of the markets. While the precise expected rate of return derived using this approach will fluctuate from year to year, the Company's policy is to hold this long-term assumption constant as long as it remains within reasonable tolerance from the derived rate. The weighted average expected rate of return on plan assets for use in that plan's valuation in 2014 is currently anticipated to be 6.24% for pension benefits and 5.64% for other postretirement benefits. 149 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 15. Employee Benefit Plans (continued) The assumed healthcare costs trend rates used in measuring the APBO and net periodic benefit costs were as follows:
December 31, ------------------------------------------------------------------------- 2013 2012 -------------------------------------- ---------------------------------- 6.4% in 2014, gradually 7.8% in 2013, gradually decreasing each year until 2094 decreasing each year until 2094 reaching the ultimate rate of 4.4% for reaching the ultimate rate of 4.4% Pre-and Post-Medicare eligible Pre-Medicare and 4.6% for for Pre-Medicare and 4.6% for claims....................... Post-Medicare. Post-Medicare.
Assumed healthcare costs trend rates may have a significant effect on the amounts reported for healthcare plans. A 1% change in assumed healthcare costs trend rates would have the following effects as of December 31, 2013:
One Percent One Percent Increase Decrease ------------ ------------ (In millions) Effect on total of service and interest costs components. $ 16 $ (13) Effect of accumulated postretirement benefit obligations. $ 237 $ (194)
Plan Assets The pension and other postretirement benefit plan assets are categorized into a three-level fair value hierarchy, as defined in Note 10, based upon the significant input with the lowest level in its valuation. The following summarizes the types of assets included within the three-level fair value hierarchy presented below. Level 1 This category includes separate accounts that are invested in fixed maturity securities, equity securities, derivative assets and short-term investments which have unadjusted quoted market prices in active markets for identical assets and liabilities. Level 2 This category includes certain separate accounts that are primarily invested in liquid and readily marketable securities. The estimated fair value of such separate account is based upon reported NAV provided by fund managers and this value represents the amount at which transfers into and out of the respective separate account are effected. These separate accounts provide reasonable levels of price transparency and can be corroborated through observable market data. Certain separate accounts are invested in investment partnerships designated as hedge funds. The values for these separate accounts is determined monthly based on the NAV of the underlying hedge fund investment. Additionally, such hedge funds generally contain lock out or other waiting period provisions for redemption requests to be filled. While the reporting and redemption restrictions may limit the frequency of trading activity in separate accounts invested in hedge funds, the reported NAV, and thus the referenced value of the separate account, provides a reasonable level of price transparency that can be corroborated through observable market data. 150 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 15. Employee Benefit Plans (continued) Directly held investments are primarily invested in U.S. and foreign government and corporate securities. Level 3 This category includes separate accounts that are invested in fixed maturity securities, equity securities, derivative assets and other investments that provide little or no price transparency due to the infrequency with which the underlying assets trade and generally require additional time to liquidate in an orderly manner. Accordingly, the values for separate accounts invested in these alternative asset classes are based on inputs that cannot be readily derived from or corroborated by observable market data. The Company provides employees with benefits under various Employee Retirement Income Security Act of 1974 ("ERISA") benefit plans. These include qualified pension plans, postretirement medical plans and certain retiree life insurance coverage. The assets of the Company's qualified pension plans are held in insurance group annuity contracts, and the vast majority of the assets of the postretirement medical plan and backing the retiree life coverage are held in insurance contracts. All of these contracts are issued by the Company and the assets under the contracts are held in insurance separate accounts that have been established by the Company. The underlying assets of the separate accounts are principally comprised of cash and cash equivalents, short-term investments, fixed maturity and equity securities, derivatives, real estate, private equity investments and hedge fund investments. The insurance contract provider engages investment management firms ("Managers") to serve as sub-advisors for the separate accounts based on the specific investment needs and requests identified by the plan fiduciary. These Managers have portfolio management discretion over the purchasing and selling of securities and other investment assets pursuant to the respective investment management agreements and guidelines established for each insurance separate account. The assets of the qualified pension plans and postretirement medical plans (the "Invested Plans") are well diversified across multiple asset categories and across a number of different Managers, with the intent of minimizing risk concentrations within any given asset category or with any given Manager. The Invested Plans, other than those held in participant directed investment accounts, are managed in accordance with investment policies consistent with the longer-term nature of related benefit obligations and within prudent risk parameters. Specifically, investment policies are oriented toward (i) maximizing the Invested Plan's funded status; (ii) minimizing the volatility of the Invested Plan's funded status; (iii) generating asset returns that exceed liability increases; and (iv) targeting rates of return in excess of a custom benchmark and industry standards over appropriate reference time periods. These goals are expected to be met through identifying appropriate and diversified asset classes and allocations, ensuring adequate liquidity to pay benefits and expenses when due and controlling the costs of administering and managing the Invested Plan's investments. Independent investment consultants are periodically used to evaluate the investment risk of Invested Plan's assets relative to liabilities, analyze the economic and portfolio impact of various asset allocations and management strategies and to recommend asset allocations. Derivative contracts may be used to reduce investment risk, to manage duration and to replicate the risk/return profile of an asset or asset class. Derivatives may not be used to leverage a portfolio in any manner, such as to magnify exposure to an asset, asset class, interest rates or any other financial variable. Derivatives are also prohibited for use in creating exposures to securities, currencies, indices or any other financial variable that is otherwise restricted. 151 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 15. Employee Benefit Plans (continued) The table below summarizes the actual weighted average allocation of the fair value of total plan assets by asset class at December 31 for the years indicated and the approved target allocation by major asset class at December 31, 2013 for the Invested Plans:
Pension Postretirement Medical -------------------------- -------------------------- Actual Allocation Actual Allocation ----------------- ----------------- Target 2013 2012 Target 2013 2012 -------- ------- ------- -------- ------- ------- Asset Class: Fixed maturity securities (1)..................... 75% 64% 69% 70% 52% 63% Equity securities (2)............................. 12% 23% 21% 30% 47% 37% Alternative securities (3)........................ 13% 13% 10% --% 1% --% ------- ------- ------- ------- Total assets..................................... 100% 100% 100% 100% ======= ======= ======= =======
Postretirement Life -------------------------- Actual Allocation ----------------- Target 2013 2012 -------- ------- ------- Asset Class: Fixed maturity securities (1)..................... --% --% --% Equity securities (2)............................. --% --% --% Alternative securities (3)........................ 100% 100% 100% ------- ------- Total assets..................................... 100% 100% ======= =======
-------- (1)Fixed maturity securities include primarily ABS, collateralized mortgage obligations, corporate, federal agency, foreign bonds, mortgage-backed securities, municipals, preferred stocks and U.S. government bonds. (2)Equity securities primarily include common stock of U.S. companies. (3)Alternative securities primarily include derivative assets, money market securities, short-term investments and other investments. Postretirement life's target and actual allocation of plan assets are all in short-term investments. 152 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 15. Employee Benefit Plans (continued) The pension and postretirement plan assets measured at estimated fair value on a recurring basis were determined as described in "-- Plan Assets." These estimated fair values and their corresponding placement in the fair value hierarchy are summarized as follows:
December 31, 2013 --------------------------------------------------------------------- Pension Benefits Other Postretirement Benefits ----------------------------------- --------------------------------- Fair Value Hierarchy Fair Value Hierarchy ------------------------- ----------------------- Total Total Estimated Estimated Fair Fair Level 1 Level 2 Level 3 Value Level 1 Level 2 Level 3 Value -------- -------- ------- --------- ------- ------- ------- --------- (In millions) Assets Fixed maturity securities: Corporate................. $ -- $ 1,948 $ 55 $ 2,003 $ -- $ 170 $ 1 $ 171 U.S. government bonds..... 868 156 -- 1,024 135 5 -- 140 Foreign bonds............. -- 675 10 685 -- 63 -- 63 Federal agencies.......... -- 274 -- 274 -- 33 -- 33 Municipals................ -- 206 -- 206 -- 15 -- 15 Other (1)................. -- 460 19 479 -- 54 -- 54 -------- -------- ------ -------- ------ ------ ---- -------- Total fixed maturity securities............. 868 3,719 84 4,671 135 340 1 476 -------- -------- ------ -------- ------ ------ ---- -------- Equity securities: Common stock - domestic... 1,064 21 139 1,224 328 -- -- 328 Common stock - foreign.... 432 -- -- 432 102 -- -- 102 -------- -------- ------ -------- ------ ------ ---- -------- Total equity securities.. 1,496 21 139 1,656 430 -- -- 430 -------- -------- ------ -------- ------ ------ ---- -------- Other investments........... -- -- 563 563 -- -- -- -- Short-term investments...... 49 290 -- 339 -- 439 -- 439 Money market securities..... 1 12 -- 13 4 -- -- 4 Derivative assets........... 16 14 33 63 -- 3 -- 3 -------- -------- ------ -------- ------ ------ ---- -------- Total assets......... $ 2,430 $ 4,056 $ 819 $ 7,305 $ 569 $ 782 $ 1 $ 1,352 ======== ======== ====== ======== ====== ====== ==== ========
153 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 15. Employee Benefit Plans (continued)
December 31, 2012 --------------------------------------------------------------------- Pension Benefits Other Postretirement Benefits ----------------------------------- --------------------------------- Fair Value Hierarchy Fair Value Hierarchy ------------------------- ----------------------- Total Total Estimated Estimated Fair Fair Level 1 Level 2 Level 3 Value Level 1 Level 2 Level 3 Value -------- -------- ------- --------- ------- ------- ------- --------- (In millions) Assets Fixed maturity securities: Corporate................. $ -- $ 2,119 $ 18 $ 2,137 $ -- $ 165 $ 4 $ 169 U.S. government bonds..... 1,082 150 -- 1,232 175 3 -- 178 Foreign bonds............. -- 714 7 721 -- 51 -- 51 Federal agencies.......... 1 314 -- 315 -- 26 -- 26 Municipals................ -- 242 -- 242 -- 70 1 71 Other (1)................. -- 460 7 467 -- 55 3 58 -------- -------- ------ -------- ------ ------ ---- -------- Total fixed maturity securities............. 1,083 3,999 32 5,114 175 370 8 553 -------- -------- ------ -------- ------ ------ ---- -------- Equity securities: Common stock - domestic... 1,024 36 129 1,189 249 1 -- 250 Common stock - foreign.... 339 -- -- 339 83 -- -- 83 -------- -------- ------ -------- ------ ------ ---- -------- Total equity securities.. 1,363 36 129 1,528 332 1 -- 333 -------- -------- ------ -------- ------ ------ ---- -------- Other investments........... -- 110 419 529 -- -- -- -- Short-term investments...... -- 200 -- 200 -- 432 -- 432 Money market securities..... 2 9 -- 11 1 -- -- 1 Derivative assets........... -- 7 1 8 -- 1 -- 1 -------- -------- ------ -------- ------ ------ ---- -------- Total assets......... $ 2,448 $ 4,361 $ 581 $ 7,390 $ 508 $ 804 $ 8 $ 1,320 ======== ======== ====== ======== ====== ====== ==== ========
-------- (1)Other primarily includes mortgage-backed securities, collateralized mortgage obligations and ABS. 154 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 15. Employee Benefit Plans (continued) A rollforward of all pension and other postretirement benefit plan assets measured at estimated fair value on a recurring basis using significant unobservable (Level 3) inputs was as follows:
Fair Value Measurements Using Significant Unobservable Inputs (Level 3) --------------------------------------------------------------------------------------------- Pension Benefits Other Postretirement Benefits - -------------------------------------------------------------- ------------------------------ Fixed Maturity Equity Fixed Maturity Securities: Securities: Securities: - --------------------------- ----------- ------------------------------ Common Foreign Stock - Other Derivative Corporate Bonds Other (1) Domestic Investments Assets Corporate Municipals Other (1) --------- ------- --------- ----------- ----------- ---------- --------- ---------- --------- (In millions) Year Ended December 31, 2013: Balance at January 1,................. $ 18 $ 7 $ 7 $ 129 $ 419 $ 1 $ 4 $ 1 $ 3 Realized gains (losses)........... -- -- -- (1) -- (2) -- -- (3) Unrealized gains (losses)........... (2) 1 -- 9 56 (17) -- -- 4 Purchases, sales, issuances and settlements, net... 17 (3) 11 2 (58) 51 (3) (1) (4) Transfers into and/or out of Level 3............ 22 5 1 -- 146 -- -- -- -- --------- ------- --------- ----------- ----------- ---------- --------- ---------- --------- Balance at December 31,................ $ 55 $ 10 $ 19 $ 139 $ 563 $ 33 $ 1 $ -- $ -- ========= ======= ========= =========== =========== ========== ========= ========== =========
Fair Value Measurements Using Significant Unobservable Inputs (Level 3) -------------------------------------------------------------------------------------------------------- Pension Benefits Other Postretirement Benefits - -------------------------------------------------------------- ----------------------------------------- Fixed Maturity Equity Fixed Maturity Securities: Securities: Securities: - --------------------------- ----------- ------------------------------ Common Foreign Stock - Other Derivative Derivative Corporate Bonds Other (1) Domestic Investments Assets Corporate Municipals Other (1) Assets --------- ------- --------- ----------- ----------- ---------- --------- ---------- --------- ---------- (In millions) Year Ended December 31, 2012: Balance at January 1,......... $ 30 $ 5 $ 2 $ 194 $ 501 $ 4 $ 4 $ 1 $ 5 $ 1 Realized gains (losses)........... -- -- -- (25) 52 4 -- -- (2) 2 Unrealized gains (losses)........... (1) 8 1 9 (38) (6) -- -- 2 (2) Purchases, sales, issuances and settlements, net... (11) (6) 4 (49) (96) (1) -- -- (2) (1) Transfers into and/or out of Level 3............ -- -- -- -- -- -- -- -- -- -- --------- ------- --------- ----------- ----------- ---------- --------- ---------- --------- ---------- Balance at December 31,....... $ 18 $ 7 $ 7 $ 129 $ 419 $ 1 $ 4 $ 1 $ 3 $ -- ========= ======= ========= =========== =========== ========== ========= ========== ========= ==========
155 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 15. Employee Benefit Plans (continued)
Fair Value Measurements Using Significant Unobservable Inputs (Level 3) -------------------------------------------------------------------------------------------------------- Pension Benefits Other Postretirement Benefits - -------------------------------------------------------------- ----------------------------------------- Fixed Maturity Equity Fixed Maturity Securities: Securities: Securities: - --------------------------- ----------- ------------------------------ Common Foreign Stock - Other Derivative Derivative Corporate Bonds Other (1) Domestic Investments Assets Corporate Municipals Other (1) Assets --------- ------- --------- ----------- ----------- ---------- --------- ---------- --------- ---------- (In millions) Year Ended December 31, 2011: Balance at January 1,......... $ 45 $ 4 $ 2 $ 228 $ 446 $(1) $ 4 $ 1 $ 6 $-- Realized gains (losses)........... -- -- (1) (57) 80 1 -- -- (1) -- Unrealized gains (losses)........... (3) (2) 1 110 42 6 -- -- 1 1 Purchases, sales, issuances and settlements, net... (13) 3 (1) (87) (67) (2) -- -- (1) -- Transfers into and/or out of Level 3............ 1 -- 1 -- -- -- -- -- -- -- --------- ------- --------- ----------- ----------- ---------- --------- ---------- --------- ---------- Balance at December 31,....... $ 30 $ 5 $ 2 $ 194 $ 501 $ 4 $ 4 $ 1 $ 5 $ 1 ========= ======= ========= =========== =========== ========== ========= ========== ========= ==========
-------- (1)Other includes ABS and collateralized mortgage obligations. Expected Future Contributions and Benefit Payments It is the Company's practice to make contributions to the qualified pension plan to comply with minimum funding requirements of ERISA. In accordance with such practice, no contributions are required for 2014. The Company expects to make discretionary contributions to the qualified pension plan of $210 million in 2014. For information on employer contributions, see "-- Obligations and Funded Status." Benefit payments due under the non-qualified pension plans are primarily funded from the Company's general assets as they become due under the provision of the plans, therefore benefit payments equal employer contributions. The Company expects to make contributions of $70 million to fund the benefit payments in 2014. Postretirement benefits are either: (i) not vested under law; (ii) a non-funded obligation of the Company; or (iii) both. Current regulations do not require funding for these benefits. The Company uses its general assets, net of participant's contributions, to pay postretirement medical claims as they come due in lieu of utilizing any plan assets. The Company expects to make contributions of $50 million towards benefit obligations in 2014 to pay postretirement medical claims. Gross benefit payments for the next 10 years, which reflect expected future service where appropriate, are expected to be as follows:
Other Pension Postretirement Benefits Benefits ------------ -------------- (In millions) 2014...... $ 447 $ 85 2015...... $ 458 $ 87 2016...... $ 470 $ 87 2017...... $ 496 $ 90 2018...... $ 503 $ 94 2019-2023. $ 2,787 $ 527
156 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 15. Employee Benefit Plans (continued) Additional Information As previously discussed, most of the assets of the pension and other postretirement benefit plans are held in group annuity and life insurance contracts issued by the Company. Total revenues from these contracts recognized in the consolidated statements of operations were $49 million, $54 million and $47 million for the years ended December 31, 2013, 2012 and 2011, respectively, and included policy charges and net investment income from investments backing the contracts and administrative fees. Total investment income (loss), including realized and unrealized gains (losses), credited to the account balances was $20 million, $867 million and $885 million for the years ended December 31, 2013, 2012 and 2011, respectively. The terms of these contracts are consistent in all material respects with those the Company offers to unaffiliated parties that are similarly situated. Defined Contribution Plans The Company sponsors defined contribution plans for substantially all Company employees under which a portion of employee contributions are matched. The Company contributed $84 million, $83 million and $73 million for the years ended December 31, 2013, 2012 and 2011, respectively. 16. Income Tax The provision for income tax from continuing operations was as follows:
Years Ended December 31, ------------------------ 2013 2012 2011 - ------ -------- -------- (In millions) Current: Federal.......................................... $ 789 $ 675 $ 551 State and local.................................. 2 2 2 Foreign.......................................... 176 176 116 ------ -------- -------- Subtotal....................................... 967 853 669 ------ -------- -------- Deferred: Federal.......................................... (411) 346 769 Foreign.......................................... 125 (144) 22 ------ -------- -------- Subtotal....................................... (286) 202 791 ------ -------- -------- Provision for income tax expense (benefit)... $ 681 $ 1,055 $ 1,460 ====== ======== ========
The Company's income (loss) from continuing operations before income tax expense (benefit) from domestic and foreign operations were as follows:
Years Ended December 31, -------------------------- 2013 2012 2011 -------- -------- -------- (In millions) Income (loss) from continuing operations: Domestic................................. $ 2,540 $ 3,153 $ 4,291 Foreign.................................. 282 545 453 -------- -------- -------- Total.................................. $ 2,822 $ 3,698 $ 4,744 ======== ======== ========
157 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 16. Income Tax (continued) The reconciliation of the income tax provision at the U.S. statutory rate to the provision for income tax as reported for continuing operations was as follows:
Years Ended December 31, ------------------------ 2013 2012 2011 ------ -------- -------- (In millions) Tax provision at U.S. statutory rate....... $ 988 $ 1,294 $ 1,660 Tax effect of: Dividend received deduction............... (66) (75) (71) Tax-exempt income......................... (42) (43) (31) Prior year tax............................ 29 10 10 Low income housing tax credits............ (190) (142) (97) Other tax credits......................... (44) (18) (22) Foreign tax rate differential............. 2 3 2 Change in valuation allowance............. (4) 13 -- Other, net................................ 8 13 9 ------ -------- -------- Provision for income tax expense (benefit). $ 681 $ 1,055 $ 1,460 ====== ======== ========
Deferred income tax represents the tax effect of the differences between the book and tax basis of assets and liabilities. Net deferred income tax assets and liabilities consisted of the following at:
December 31, --------------------- 2013 2012 ---------- ---------- (In millions) Deferred income tax assets: Policyholder liabilities and receivables........ $ 1,823 $ 2,495 Net operating loss carryforwards................ 64 35 Employee benefits............................... 649 1,075 Capital loss carryforwards...................... 14 17 Tax credit carryforwards........................ 909 372 Litigation-related and government mandated...... 223 175 Other........................................... 349 198 ---------- ---------- Total gross deferred income tax assets........ 4,031 4,367 Less: Valuation allowance....................... 72 52 ---------- ---------- Total net deferred income tax assets.......... 3,959 4,315 ---------- ---------- Deferred income tax liabilities: Investments, including derivatives.............. 2,021 2,283 DAC and VOBA.................................... 1,677 1,629 Net unrealized investment gains................. 2,019 3,412 Other........................................... 27 27 ---------- ---------- Total deferred income tax liabilities......... 5,744 7,351 ---------- ---------- Net deferred income tax asset (liability)... $ (1,785) $ (3,036) ========== ==========
158 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 16. Income Tax (continued) The following table sets forth the domestic, state, and foreign net operating and capital loss carryforwards for tax purposes at December 31, 2013.
Net Operating Loss Capital Loss Carryforwards Carryforwards ------------------------------- ------------------------------- Amount Expiration Amount Expiration ------------- ----------------- ------------- ----------------- (In millions) (In millions) Domestic. $ 46 Beginning in 2018 $ -- N/A State.... $ 150 N/A $ -- N/A Foreign.. $ 69 Beginning in 2027 $ 40 Beginning in 2014
Foreign tax credit carryforwards of $357 million at December 31, 2013 will expire beginning in 2021. General business credits of $552 million will expire beginning in 2030. The Company has recorded valuation allowance decreases related to tax expense of $1 million related to certain state and foreign net operating loss carryforwards, $3 million related to certain foreign capital loss carryforwards, and charges of $24 million related to certain other deferred tax assets. The valuation allowance reflects management's assessment, based on available information, that it is more likely than not that the deferred income tax asset for certain foreign net operating and capital loss carryforwards and certain state net operating loss carryforwards will not be realized. The tax benefit will be recognized when management believes that it is more likely than not that these deferred income tax assets are realizable. The Company participates in a tax sharing agreement with MetLife, Inc. as described in Note 1. Pursuant to this tax sharing agreement, the amount due to affiliates included $157 million for the year ended December 31, 2013. The amounts due from affiliates included $14 million and $34 million for the years ended December 31, 2012 and 2011, respectively. The Company files income tax returns with the U.S. federal government and various state and local jurisdictions, as well as foreign jurisdictions. The Company is under continuous examination by the Internal Revenue Service ("IRS") and other tax authorities in jurisdictions in which the Company has significant business operations. The income tax years under examination vary by jurisdiction and subsidiary. The Company is no longer subject to U.S. federal, state, or local income tax examinations in major taxing jurisdictions for years prior to 2003, except for 2000 through 2002 where the IRS has disallowed certain tax credits claimed and the Company continues to protest. The IRS audit cycle for the years 2003 through 2006, which began in April 2010, is expected to conclude in 2014. The Company's liability for unrecognized tax benefits may increase or decrease in the next 12 months. A reasonable estimate of the increase or decrease cannot be made at this time. However, the Company continues to believe that the ultimate resolution of the pending issues will not result in a material change to its consolidated financial statements, although the resolution of income tax matters could impact the Company's effective tax rate for a particular future period. 159 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 16. Income Tax (continued) A reconciliation of the beginning and ending amount of unrecognized tax benefits was as follows:
Years Ended December 31, -------------------------- 2013 2012 2011 -------- -------- -------- (In millions) Balance at January 1,.................................................... $ 532 $ 525 $ 499 Additions for tax positions of prior years............................... 50 27 26 Reductions for tax positions of prior years.............................. (4) (5) -- Additions for tax positions of current year.............................. 3 -- 1 Reductions for tax positions of current year............................. -- -- (1) Settlements with tax authorities......................................... (49) (15) -- -------- -------- -------- Balance at December 31,.................................................. $ 532 $ 532 $ 525 ======== ======== ======== Unrecognized tax benefits that, if recognized would impact the effective rate................................................................... $ 491 $ 466 $ 459 ======== ======== ========
The Company classifies interest accrued related to unrecognized tax benefits in interest expense, included within other expenses, while penalties are included in income tax expense. Interest was as follows:
Years Ended December 31, ---------------------- 2013 2012 2011 ------- ------ ------- (In millions) Interest recognized in the consolidated statements of operations. $ 17 $ 8 $ 27 December 31, -------------- 2013 2012 ------ ------- (In millions) Interest included in other liabilities in the consolidated balance sheets.. $ 228 $ 211
The Company had no penalties for the years ended December 31, 2013, 2012 and 2011. The U.S. Treasury Department and the IRS have indicated that they intend to address through regulations the methodology to be followed in determining the dividends received deduction ("DRD"), related to variable life insurance and annuity contracts. The DRD reduces the amount of dividend income subject to tax and is a significant component of the difference between the actual tax expense and expected amount determined using the federal statutory tax rate of 35%. Any regulations that the IRS ultimately proposes for issuance in this area will be subject to public notice and comment, at which time insurance companies and other interested parties will have the opportunity to raise legal and practical questions about the content, scope and application of such regulations. As a result, the ultimate timing and substance of any such regulations are unknown at this time. For the years ended December 31, 2013 and 2012, the Company recognized an income tax benefit of $53 million and $70 million, respectively, related to the separate account DRD. The 2013 benefit included an expense of $7 million related to a true-up of the 2012 tax return. The 2012 benefit included a benefit of $2 million related to a true-up of the 2011 tax return. 160 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 17. Contingencies, Commitments and Guarantees Contingencies Litigation The Company is a defendant in a large number of litigation matters. In some of the matters, very large and/or indeterminate amounts, including punitive and treble damages, are sought. Modern pleading practice in the U.S. permits considerable variation in the assertion of monetary damages or other relief. Jurisdictions may permit claimants not to specify the monetary damages sought or may permit claimants to state only that the amount sought is sufficient to invoke the jurisdiction of the trial court. In addition, jurisdictions may permit plaintiffs to allege monetary damages in amounts well exceeding reasonably possible verdicts in the jurisdiction for similar matters. This variability in pleadings, together with the actual experience of the Company in litigating or resolving through settlement numerous claims over an extended period of time, demonstrates to management that the monetary relief which may be specified in a lawsuit or claim bears little relevance to its merits or disposition value. Due to the vagaries of litigation, the outcome of a litigation matter and the amount or range of potential loss at particular points in time may normally be difficult to ascertain. Uncertainties can include how fact finders will evaluate documentary evidence and the credibility and effectiveness of witness testimony, and how trial and appellate courts will apply the law in the context of the pleadings or evidence presented, whether by motion practice, or at trial or on appeal. Disposition valuations are also subject to the uncertainty of how opposing parties and their counsel will themselves view the relevant evidence and applicable law. The Company establishes liabilities for litigation and regulatory loss contingencies when it is probable that a loss has been incurred and the amount of the loss can be reasonably estimated. Liabilities have been established for a number of the matters noted below. It is possible that some of the matters could require the Company to pay damages or make other expenditures or establish accruals in amounts that could not be estimated at December 31, 2013. While the potential future charges could be material in the particular quarterly or annual periods in which they are recorded, based on information currently known to management, management does not believe any such charges are likely to have a material effect on the Company's financial position. Matters as to Which an Estimate Can Be Made For some of the matters disclosed below, the Company is able to estimate a reasonably possible range of loss. For such matters where a loss is believed to be reasonably possible, but not probable, no accrual has been made. As of December 31, 2013, the Company estimates the aggregate range of reasonably possible losses in excess of amounts accrued for these matters to be $0 to $360 million. Matters as to Which an Estimate Cannot Be Made For other matters disclosed below, the Company is not currently able to estimate the reasonably possible loss or range of loss. The Company is often unable to estimate the possible loss or range of loss until developments in such matters have provided sufficient information to support an assessment of the range of possible loss, such as quantification of a damage demand from plaintiffs, discovery from other parties and investigation of factual allegations, rulings by the court on motions or appeals, analysis by experts, and the 161 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 17. Contingencies, Commitments and Guarantees (continued) progress of settlement negotiations. On a quarterly and annual basis, the Company reviews relevant information with respect to litigation contingencies and updates its accruals, disclosures and estimates of reasonably possible losses or ranges of loss based on such reviews. Asbestos-Related Claims Metropolitan Life Insurance Company is and has been a defendant in a large number of asbestos-related suits filed primarily in state courts. These suits principally allege that the plaintiff or plaintiffs suffered personal injury resulting from exposure to asbestos and seek both actual and punitive damages. Metropolitan Life Insurance Company has never engaged in the business of manufacturing, producing, distributing or selling asbestos or asbestos-containing products nor has Metropolitan Life Insurance Company issued liability or workers' compensation insurance to companies in the business of manufacturing, producing, distributing or selling asbestos or asbestos-containing products. The lawsuits principally have focused on allegations with respect to certain research, publication and other activities of one or more of Metropolitan Life Insurance Company's employees during the period from the 1920's through approximately the 1950's and allege that Metropolitan Life Insurance Company learned or should have learned of certain health risks posed by asbestos and, among other things, improperly publicized or failed to disclose those health risks. Metropolitan Life Insurance Company believes that it should not have legal liability in these cases. The outcome of most asbestos litigation matters, however, is uncertain and can be impacted by numerous variables, including differences in legal rulings in various jurisdictions, the nature of the alleged injury and factors unrelated to the ultimate legal merit of the claims asserted against Metropolitan Life Insurance Company. Metropolitan Life Insurance Company employs a number of resolution strategies to manage its asbestos loss exposure, including seeking resolution of pending litigation by judicial rulings and settling individual or groups of claims or lawsuits under appropriate circumstances. Claims asserted against Metropolitan Life Insurance Company have included negligence, intentional tort and conspiracy concerning the health risks associated with asbestos. Metropolitan Life Insurance Company's defenses (beyond denial of certain factual allegations) include that: (i) Metropolitan Life Insurance Company owed no duty to the plaintiffs -- it had no special relationship with the plaintiffs and did not manufacture, produce, distribute or sell the asbestos products that allegedly injured plaintiffs; (ii) plaintiffs did not rely on any actions of Metropolitan Life Insurance Company; (iii) Metropolitan Life Insurance Company's conduct was not the cause of the plaintiffs' injuries; (iv) plaintiffs' exposure occurred after the dangers of asbestos were known; and (v) the applicable time with respect to filing suit has expired. During the course of the litigation, certain trial courts have granted motions dismissing claims against Metropolitan Life Insurance Company, while other trial courts have denied Metropolitan Life Insurance Company's motions. There can be no assurance that Metropolitan Life Insurance Company will receive favorable decisions on motions in the future. While most cases brought to date have settled, Metropolitan Life Insurance Company intends to continue to defend aggressively against claims based on asbestos exposure, including defending claims at trials. 162 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 17. Contingencies, Commitments and Guarantees (continued) The approximate total number of asbestos personal injury claims pending against Metropolitan Life Insurance Company as of the dates indicated, the approximate number of new claims during the years ended on those dates and the approximate total settlement payments made to resolve asbestos personal injury claims at or during those years are set forth in the following table:
December 31, -------------------------------------- 2013 2012 2011 --------- --------- --------- (In millions, except number of claims) Asbestos personal injury claims at year end. 67,983 65,812 66,747 Number of new claims during the year........ 5,898 5,303 4,972 Settlement payments during the year (1)..... $ 37.0 $ 36.4 $ 34.2
-------- (1)Settlement payments represent payments made by MLIC during the year in connection with settlements made in that year and in prior years. Amounts do not include MLIC's attorneys' fees and expenses and do not reflect amounts received from insurance carriers. The number of asbestos cases that may be brought, the aggregate amount of any liability that Metropolitan Life Insurance Company may incur, and the total amount paid in settlements in any given year are uncertain and may vary significantly from year to year. The ability of Metropolitan Life Insurance Company to estimate its ultimate asbestos exposure is subject to considerable uncertainty, and the conditions impacting its liability can be dynamic and subject to change. The availability of reliable data is limited and it is difficult to predict the numerous variables that can affect liability estimates, including the number of future claims, the cost to resolve claims, the disease mix and severity of disease in pending and future claims, the impact of the number of new claims filed in a particular jurisdiction and variations in the law in the jurisdictions in which claims are filed, the possible impact of tort reform efforts, the willingness of courts to allow plaintiffs to pursue claims against Metropolitan Life Insurance Company when exposure to asbestos took place after the dangers of asbestos exposure were well known, and the impact of any possible future adverse verdicts and their amounts. The ability to make estimates regarding ultimate asbestos exposure declines significantly as the estimates relate to years further in the future. In the Company's judgment, there is a future point after which losses cease to be probable and reasonably estimable. It is reasonably possible that the Company's total exposure to asbestos claims may be materially greater than the asbestos liability currently accrued and that future charges to income may be necessary. While the potential future charges could be material in the particular quarterly or annual periods in which they are recorded, based on information currently known by management, management does not believe any such charges are likely to have a material effect on the Company's financial position. The Company believes adequate provision has been made in its consolidated financial statements for all probable and reasonably estimable losses for asbestos-related claims. Metropolitan Life Insurance Company's recorded asbestos liability is based on its estimation of the following elements, as informed by the facts presently known to it, its understanding of current law and its past experiences: (i) the probable and reasonably estimable liability for asbestos claims already asserted against Metropolitan Life Insurance Company, including claims settled but not yet paid; (ii) the probable and reasonably estimable liability for asbestos claims not yet 163 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 17. Contingencies, Commitments and Guarantees (continued) asserted against Metropolitan Life Insurance Company, but which Metropolitan Life Insurance Company believes are reasonably probable of assertion; and (iii) the legal defense costs associated with the foregoing claims. Significant assumptions underlying Metropolitan Life Insurance Company's analysis of the adequacy of its recorded liability with respect to asbestos litigation include: (i) the number of future claims; (ii) the cost to resolve claims; and (iii) the cost to defend claims. Metropolitan Life Insurance Company reevaluates on a quarterly and annual basis its exposure from asbestos litigation, including studying its claims experience, reviewing external literature regarding asbestos claims experience in the United States, assessing relevant trends impacting asbestos liability and considering numerous variables that can affect its asbestos liability exposure on an overall or per claim basis. These variables include bankruptcies of other companies involved in asbestos litigation, legislative and judicial developments, the number of pending claims involving serious disease, the number of new claims filed against it and other defendants and the jurisdictions in which claims are pending. Based upon its reevaluation of its exposure from asbestos litigation, Metropolitan Life Insurance Company has updated its liability analysis for asbestos-related claims through December 31, 2013. The frequency of severe claims relating to asbestos has not declined as expected, and Metropolitan Life Insurance Company has reflected this in its provisions. Accordingly, Metropolitan Life Insurance Company increased its recorded liability for asbestos related claims from $417 million to $572 million at December 31, 2013. Regulatory Matters The Company receives and responds to subpoenas or other inquiries from state regulators, including state insurance commissioners; state attorneys general or other state governmental authorities; federal regulators, including the U.S. Securities and Exchange Commission ("SEC") ; federal governmental authorities, including congressional committees; and the Financial Industry Regulatory Authority ("FINRA") seeking a broad range of information. The issues involved in information requests and regulatory matters vary widely. The Company cooperates in these inquiries. In the Matter of Chemform, Inc. Site, Pompano Beach, Broward County, Florida In July 2010, the Environmental Protection Agency ("EPA") advised Metropolitan Life Insurance Company that it believed payments were due under two settlement agreements, known as "Administrative Orders on Consent," that New England Mutual Life Insurance Company ("New England Mutual") signed in 1989 and 1992 with respect to the cleanup of a Superfund site in Florida (the "Chemform Site"). The EPA originally contacted Metropolitan Life Insurance Company (as successor to New England Mutual) and a third party in 2001, and advised that they owed additional clean-up costs for the Chemform Site. The matter was not resolved at that time. The EPA is requesting payment of an amount under $1 million from Metropolitan Life Insurance Company and such third party for past costs and an additional amount for future environmental testing costs at the Chemform Site. In June 2012, the EPA, Metropolitan Life Insurance Company and the third party executed an Administrative Order on Consent under which Metropolitan Life Insurance Company and the third party have agreed to be responsible for certain environmental testing at the Chemform site. The Company estimates that its costs for the environmental testing will not exceed $100,000. The June 2012 Administrative Order on Consent does not resolve the EPA's claim for past clean-up costs. The EPA may seek additional costs if the environmental testing identifies issues. The Company estimates that the aggregate cost to resolve this matter will not exceed $1 million. 164 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 17. Contingencies, Commitments and Guarantees (continued) Metco Site, Hicksville, Nassau County, New York On February 22, 2012, the New York State Department of Environmental Conservation ("Department of Environmental Conservation") issued a notice to Metropolitan Life Insurance Company, as purported successor in interest to New England Mutual, that it is a potentially responsible party with respect to hazardous substances and hazardous waste located on a property that New England Mutual owned for a time in 1978. Metropolitan Life Insurance Company has responded to the Department of Environmental Conservation and asserted that it is not a potentially responsible party under the law. Sales Practices Regulatory Matters. Regulatory authorities in a small number of states and FINRA, and occasionally the SEC, have had investigations or inquiries relating to sales of individual life insurance policies or annuities or other products by Metropolitan Life Insurance Company, NELICO, GALIC, and broker dealer New England Securities Corporation. These investigations often focus on the conduct of particular financial services representatives and the sale of unregistered or unsuitable products or the misuse of client assets. Over the past several years, these and a number of investigations by other regulatory authorities were resolved for monetary payments and certain other relief, including restitution payments. The Company may continue to resolve investigations in a similar manner. The Company believes adequate provision has been made in its consolidated financial statements for all probable and reasonably estimable losses for these sales practices-related investigations or inquiries. Unclaimed Property Litigation and Inquiries In 2012, MetLife, Inc., for itself and on behalf of entities including Metropolitan Life Insurance Company, reached agreements with representatives of the U.S. jurisdictions that were conducting audits of MetLife, Inc. and certain of its affiliates, including Metropolitan Life Insurance Company, for compliance with unclaimed property laws, and with state insurance regulators directly involved in a multistate targeted market conduct examination relating to claim-payment practices and compliance with unclaimed property laws. In the first quarter of 2012, the Company recorded a $47 million after tax charge for the multistate examination payment and the expected acceleration of benefit payments to policyholders under the settlements. On September 20, 2012, the West Virginia Treasurer filed an action against Metropolitan Life Insurance Company in West Virginia state court (West Virginia ex rel. John D. Perdue v. Metropolitan Life Insurance Company, Circuit Court of Putnam County, Civil Action No. 12-C-295) alleging that Metropolitan Life Insurance Company violated the West Virginia Uniform Unclaimed Property Act, seeking to compel compliance with the Act, and seeking payment of unclaimed property, interest, and penalties. On November 21, 2012 and January 9, 2013, the Treasurer filed substantially identical suits against NELICO and GALIC, respectively. On December 30, 2013, the court granted defendants' motions to dismiss all of the West Virginia Treasurer's actions. The Treasurer has filed a notice to appeal the dismissal order. At least one other jurisdiction is pursuing a market conduct examination concerning compliance with unclaimed property statutes. It is possible that other jurisdictions may pursue similar examinations, audits, or lawsuits and that such actions may result in additional payments to beneficiaries, additional escheatment of funds deemed abandoned under state laws, administrative penalties, interest, and/or further changes to the Company's procedures. The Company is not currently able to estimate these additional possible costs. 165 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 17. Contingencies, Commitments and Guarantees (continued) Total Asset Recovery Services, LLC on behalf of the State of Florida v. MetLife, Inc., et. al. (Cir. Ct. Leon County, FL, filed October 27, 2010) Alleging that MetLife, Inc. and another company have violated the Florida Disposition of Unclaimed Property law by failing to escheat to Florida benefits of 9,022 life insurance contracts, Total Asset Recovery Services, LLC ("the Relator") has brought an action under the Florida False Claims Act seeking to recover damages on behalf of Florida. The action had been sealed by court order until December 17, 2012. The Relator alleges that the aggregate damages attributable to MetLife, Inc., including statutory damages and treble damages, are $767 million. The Relator also bases its damage calculation in part on its assumption that the average face amount of the subject policies is $120,000. MetLife, Inc. strongly disputes this assumption, the Relator's alleged damages amounts, and other allegations in the complaint. On December 14, 2012, the Florida Attorney General apprised the court that the State of Florida declined to intervene in the action and noted that the allegations in the complaint ". . . are very similar (if not identical) to those raised in regulatory investigations of the defendants that predated the filing of the action" and that those regulatory investigations have been resolved. On August 20, 2013, the court granted defendants' motion to dismiss the action. The Relator has appealed the dismissal. Total Control Accounts Litigation Metropolitan Life Insurance Company is a defendant in a consolidated lawsuit related to its use of retained asset accounts, known as Total Control Accounts ("TCA"), as a settlement option for death benefits. Keife, et al. v. Metropolitan Life Insurance Company (D. Nev., filed in state court on July 30, 2010 and removed to federal court on September 7, 2010); and Simon v. Metropolitan Life Insurance Company (D. Nev., filed November 3, 2011) These putative class action lawsuits, which have been consolidated, raise breach of contract claims arising from Metropolitan Life Insurance Company's use of the TCA to pay life insurance benefits under the Federal Employees' Group Life Insurance program. On March 8, 2013, the court granted Metropolitan Life Insurance Company's motion for summary judgment. Plaintiffs have appealed that decision to the United States Court of Appeals for the Ninth Circuit. Other Litigation Merrill Haviland, et al. v. Metropolitan Life Insurance Company (E.D. Mich., removed to federal court on July 22, 2011) This lawsuit was filed by 45 retired General Motors ("GM") employees against Metropolitan Life Insurance Company and the amended complaint includes claims for conversion, unjust enrichment, breach of contract, fraud, intentional infliction of emotional distress, fraudulent insurance acts, unfair trade practices, and ERISA claims based upon GM's 2009 reduction of the employees' life insurance coverage under GM's ERISA-governed plan. The complaint includes a count seeking class action status. Metropolitan Life Insurance Company is the insurer of GM's group life insurance plan and administers claims under the plan. According to the complaint, Metropolitan Life Insurance Company had previously provided plaintiffs with a "written guarantee" that their life insurance benefits under the GM plan would not be reduced for the rest of 166 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 17. Contingencies, Commitments and Guarantees (continued) their lives. On June 26, 2012, the district court granted Metropolitan Life Insurance Company's motion to dismiss the complaint. Plaintiffs appealed and the United States Court of Appeals for the Sixth Circuit affirmed the dismissal of the action on September 12, 2013. McGuire v. Metropolitan Life Insurance Company (E.D. Mich., filed February 22, 2012) This lawsuit was filed by the fiduciary for the Union Carbide Employees' Pension Plan and alleges that Metropolitan Life Insurance Company, which issued annuity contracts to fund some of the benefits the Plan provides, engaged in transactions that ERISA prohibits and violated duties under ERISA and federal common law by determining that no dividends were payable with respect to the contracts from and after 1999. On September 26, 2012, the court denied Metropolitan Life Insurance Company's motion to dismiss the complaint. The trial has been scheduled for June 2014. Sun Life Assurance Company of Canada Indemnity Claim In 2006, Sun Life Assurance Company of Canada ("Sun Life"), as successor to the purchaser of Metropolitan Life Insurance Company's Canadian operations, filed a lawsuit in Toronto, seeking a declaration that Metropolitan Life Insurance Company remains liable for "market conduct claims" related to certain individual life insurance policies sold by Metropolitan Life Insurance Company and that have been transferred to Sun Life. Sun Life had asked that the court require Metropolitan Life Insurance Company to indemnify Sun Life for these claims pursuant to indemnity provisions in the sale agreement for the sale of Metropolitan Life Insurance Company's Canadian operations entered into in June of 1998. In January 2010, the court found that Sun Life had given timely notice of its claim for indemnification but, because it found that Sun Life had not yet incurred an indemnifiable loss, granted Metropolitan Life Insurance Company's motion for summary judgment. Both parties appealed but subsequently agreed to withdraw the appeal and consider the indemnity claim through arbitration. In September 2010, Sun Life notified Metropolitan Life Insurance Company that a purported class action lawsuit was filed against Sun Life in Toronto, Fehr v. Sun Life Assurance Co. (Super. Ct., Ontario, September 2010), alleging sales practices claims regarding the same individual policies sold by Metropolitan Life Insurance Company and transferred to Sun Life. An amended class action complaint in that case was served on Sun Life, again without naming Metropolitan Life Insurance Company as a party. On August 30, 2011, Sun Life notified Metropolitan Life Insurance Company that a purported class action lawsuit was filed against Sun Life in Vancouver, Alamwala v. Sun Life Assurance Co. (Sup. Ct., British Columbia, August 2011), alleging sales practices claims regarding certain of the same policies sold by Metropolitan Life Insurance Company and transferred to Sun Life. Sun Life contends that Metropolitan Life Insurance Company is obligated to indemnify Sun Life for some or all of the claims in these lawsuits. These sales practices cases against Sun Life are ongoing and the Company is unable to estimate the reasonably possible loss or range of loss arising from this litigation. C-Mart, Inc. v. Metropolitan Life Ins. Co., et al. (S.D. Fla., January 10, 2013). Cadenasso v. Metropolitan Life Insurance Co., et al. (N.D. Cal., November 26, 2013). Plaintiffs filed these lawsuits against defendants, including Metropolitan Life Insurance Company and a former MetLife financial services representative, alleging that the defendants sent unsolicited fax advertisements to plaintiff and others in violation of the Telephone Consumer Protection Act, as amended by the Junk Fax Prevention Act, 47 U.S.C. (S) 227 ("TCPA"). In the C-Mart case, the court granted plaintiff's 167 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 17. Contingencies, Commitments and Guarantees (continued) motion to certify a class of approximately 36,000 persons in Missouri who, during the period of August 7, 2012 through September 6, 2012, were allegedly sent an unsolicited fax in violation of the TCPA. Trial is set for May 2014. In the Cadenasso case, plaintiff seeks certification of a nationwide class of persons (except for Missouri residents) who were allegedly sent millions of unsolicited faxes in violation of the TCPA. In both cases, plaintiffs seek an award of statutory damages under the TCPA in the amount of $500 for each violation and to have such damages trebled. Sales Practices Claims Over the past several years, the Company has faced numerous claims, including class action lawsuits, alleging improper marketing or sales of individual life insurance policies, annuities, mutual funds or other products. Some of the current cases seek substantial damages, including punitive and treble damages and attorneys' fees. The Company continues to vigorously defend against the claims in these matters. The Company believes adequate provision has been made in its consolidated financial statements for all probable and reasonably estimable losses for sales practices matters. Summary Putative or certified class action litigation and other litigation and claims and assessments against the Company, in addition to those discussed previously and those otherwise provided for in the Company's consolidated financial statements, have arisen in the course of the Company's business, including, but not limited to, in connection with its activities as an insurer, employer, investor, investment advisor and taxpayer. Further, state insurance regulatory authorities and other federal and state authorities regularly make inquiries and conduct investigations concerning the Company's compliance with applicable insurance and other laws and regulations. It is not possible to predict the ultimate outcome of all pending investigations and legal proceedings. In some of the matters referred to previously, very large and/or indeterminate amounts, including punitive and treble damages, are sought. Although in light of these considerations it is possible that an adverse outcome in certain cases could have a material effect upon the Company's financial position, based on information currently known by the Company's management, in its opinion, the outcomes of such pending investigations and legal proceedings are not likely to have such an effect. However, given the large and/or indeterminate amounts sought in certain of these matters and the inherent unpredictability of litigation, it is possible that an adverse outcome in certain matters could, from time to time, have a material effect on the Company's consolidated net income or cash flows in particular quarterly or annual periods. Insolvency Assessments Most of the jurisdictions in which the Company is admitted to transact business require insurers doing business within the jurisdiction to participate in guaranty associations, which are organized to pay contractual benefits owed pursuant to insurance policies issued by impaired, insolvent or failed insurers. These associations levy assessments, up to prescribed limits, on all member insurers in a particular state on the basis of the proportionate share of the premiums written by member insurers in the lines of business in which the impaired, insolvent or failed insurer engaged. Some states permit member insurers to recover assessments paid through full or partial premium tax offsets. 168 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 17. Contingencies, Commitments and Guarantees (continued) Assets and liabilities held for insolvency assessments were as follows:
December 31, --------------- 2013 2012 ------- ------- (In millions) Other Assets: Premium tax offset for future undiscounted assessments....... $ 46 $ 85 Premium tax offsets currently available for paid assessments. 54 12 ------- ------- $ 100 $ 97 ======= ======= Other Liabilities: Insolvency assessments....................................... $ 67 $ 136 ======= =======
On September 1, 2011, the New York State Department of Financial Services filed a liquidation plan for Executive Life Insurance Company of New York ("ELNY"), which had been under rehabilitation by the Liquidation Bureau since 1991. The plan involves the satisfaction of insurers' financial obligations under a number of state life and health insurance guaranty associations and also provides additional industry support for certain ELNY policyholders. The Company recorded a net charge (benefit) of ($23) million, $22 million and $21 million, net of income tax, during the years ended December 31, 2013, 2012 and 2011, respectively, related to ELNY. Commitments Leases The Company, as lessee, has entered into various lease and sublease agreements for office space, information technology and other equipment. Future minimum gross rental payments relating to these lease arrangements are as follows:
Amount ------------- (In millions) 2014....... $ 232 2015....... 204 2016....... 171 2017....... 128 2018....... 114 Thereafter. 757 -------- Total...... $ 1,606 ========
Total minimum rentals to be received in the future under non-cancelable subleases are $131 million as of December 31, 2013. 169 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 17. Contingencies, Commitments and Guarantees (continued) Commitments to Fund Partnership Investments The Company makes commitments to fund partnership investments in the normal course of business. The amounts of these unfunded commitments were $2.7 billion and $2.2 billion at December 31, 2013 and 2012, respectively. The Company anticipates that these amounts will be invested in partnerships over the next five years. Mortgage Loan Commitments The Company commits to lend funds under mortgage loan commitments. The amounts of these mortgage loan commitments were $3.1 billion and $2.7 billion at December 31, 2013 and 2012, respectively. Commitments to Fund Bank Credit Facilities, Bridge Loans and Private Corporate Bond Investments The Company commits to lend funds under bank credit facilities, bridge loans and private corporate bond investments. The amounts of these unfunded commitments were $687 million and $971 million at December 31, 2013 and 2012, respectively. Guarantees In the normal course of its business, the Company has provided certain indemnities, guarantees and commitments to third parties such that it may be required to make payments now or in the future. In the context of acquisition, disposition, investment and other transactions, the Company has provided indemnities and guarantees, including those related to tax, environmental and other specific liabilities and other indemnities and guarantees that are triggered by, among other things, breaches of representations, warranties or covenants provided by the Company. In addition, in the normal course of business, the Company provides indemnifications to counterparties in contracts with triggers similar to the foregoing, as well as for certain other liabilities, such as third-party lawsuits. These obligations are often subject to time limitations that vary in duration, including contractual limitations and those that arise by operation of law, such as applicable statutes of limitation. In some cases, the maximum potential obligation under the indemnities and guarantees is subject to a contractual limitation ranging from less than $1 million to $800 million, with a cumulative maximum of $1.0 billion, while in other cases such limitations are not specified or applicable. Since certain of these obligations are not subject to limitations, the Company does not believe that it is possible to determine the maximum potential amount that could become due under these guarantees in the future. Management believes that it is unlikely the Company will have to make any material payments under these indemnities, guarantees, or commitments. In addition, the Company indemnifies its directors and officers as provided in its charters and by-laws. Also, the Company indemnifies its agents for liabilities incurred as a result of their representation of the Company's interests. Since these indemnities are generally not subject to limitation with respect to duration or amount, the Company does not believe that it is possible to determine the maximum potential amount that could become due under these indemnities in the future. The Company's recorded liabilities were $3 million and $4 million at December 31, 2013 and 2012, respectively, for indemnities, guarantees and commitments. 170 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 18. Quarterly Results of Operations (Unaudited) The unaudited quarterly results of operations for 2013 and 2012 are summarized in the table below:
Three Months Ended --------------------------------------------- March 31, June 30, September 30, December 31, --------- -------- ------------- ------------ (In millions) 2013: Total revenues................................................... $ 8,766 $ 8,632 $ 8,018 $ 9,884 Total expenses................................................... $ 7,843 $ 7,771 $ 7,758 $ 9,106 Income (loss) from continuing operations, net of income tax...... $ 673 $ 646 $ 242 $ 580 Income (loss) from discontinued operations, net of income tax.... $ -- $ -- $ -- $ 1 Net income (loss)................................................ $ 673 $ 646 $ 242 $ 581 Less: Net income (loss) attributable to noncontrolling interests. $ (1) $ 3 $ (5) $ (4) Net income (loss) attributable to Metropolitan Life Insurance Company.............................................. $ 674 $ 643 $ 247 $ 585 2012: Total revenues................................................... $ 7,635 $ 10,048 $ 8,159 $ 10,204 Total expenses................................................... $ 7,502 $ 7,656 $ 7,639 $ 9,551 Income (loss) from continuing operations, net of income tax...... $ 139 $ 1,605 $ 396 $ 503 Income (loss) from discontinued operations, net of income tax.... $ 14 $ 3 $ -- $ 23 Net income (loss)................................................ $ 153 $ 1,608 $ 396 $ 526 Less: Net income (loss) attributable to noncontrolling interests. $ -- $ 4 $ (6) $ 4 Net income (loss) attributable to Metropolitan Life Insurance Company.............................................. $ 153 $ 1,604 $ 402 $ 522
19. Related Party Transactions Service Agreements The Company has entered into various agreements with affiliates for services necessary to conduct its activities. Typical services provided under these agreements include personnel, policy administrative functions and distribution services. For certain agreements, charges are based on various performance measures or activity-based costing. The bases for such charges are modified and adjusted by management when necessary or appropriate to reflect fairly and equitably the actual incidence of cost incurred by the Company and/or affiliate. Expenses and fees incurred with affiliates related to these agreements, recorded in other expenses, were $2.4 billion, $2.6 billion and $2.8 billion for the years ended December 31, 2013, 2012 and 2011, respectively. Revenues received from affiliates related to these agreements recorded in universal life and investment-type product policy fees were $127 million, $108 million and $94 million for the years ended December 31, 2013, 2012 and 2011, respectively. Revenues received from affiliates related to these agreements recorded in other revenues were $142 million, $113 million and $46 million for the years ended December 31, 2013, 2012 and 2011, respectively. The Company also entered into agreements with affiliates to provide additional services necessary to conduct the affiliates' activities. Typical services provided under these agreements include management, policy administrative functions, investment advice and distribution services. Expenses incurred by the Company related to these agreements, included in other expenses, were $1.4 billion, $1.6 billion and $1.6 billion for the years ended December 31, 2013, 2012 and 2011, respectively, and were reimbursed to the Company by these affiliates. 171 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Notes to the Consolidated Financial Statements -- (Continued) 19. Related Party Transactions (continued) The Company had net payables to affiliates, related to the items discussed above, of $327 million and $346 million at December 31, 2013 and 2012, respectively. See Notes 6, 8 and 12 for additional information on related party transactions. 20. Subsequent Events In the second quarter of 2013, MetLife, Inc. announced its plans to merge three U.S.-based life insurance companies and an offshore reinsurance subsidiary to create one larger U.S.-based and U.S.-regulated life insurance company (the "Mergers"). The companies to be merged are MICC, MLI-USA and MLIIC, each a U.S. insurance company that issues variable annuity products in addition to other products, and Exeter, a reinsurance company that mainly reinsures guarantees associated with variable annuity products. MICC, which is expected to be renamed and domiciled in Delaware, will be the surviving entity. Exeter, formerly a Cayman Islands company, was re-domesticated to Delaware in October 2013, resulting in a redistribution of assets held in trust and the cancellation of outstanding letters of credit which were no longer required. Effective January 1, 2014, following receipt of New York State Department of Financial Services approval, MICC withdrew its license to issue insurance policies and annuity contracts in New York. Also effective January 1, 2014, MICC reinsured with Metropolitan Life Insurance Company all existing New York insurance policies and annuity contracts that include a separate account feature. As a result of the reinsurance agreements, Metropolitan Life Insurance Company recorded a funds withheld asset, included in other invested assets, of $100 million, a deposit liability, included in other liabilities, of $448 million, an assumed reserve, included in policyholder account balances, of $100 million, and received cash and investments of $448 million from MICC. On December 31, 2013, MICC deposited qualifying investments into a custodial account, which became restricted to secure MICC's remaining New York policyholder liabilities not covered by such reinsurance on January 1, 2014. In anticipation of establishing this custodial account with qualifying investments, Metropolitan Life Insurance Company transferred investments with an estimated fair value of $751 million to MICC and received from MICC qualifying investments with an estimated fair value of $739 million and cash of $12 million in the fourth quarter of 2013. See Note 8. The Mergers are expected to occur in the fourth quarter of 2014, subject to regulatory approvals. At December 31, 2013, the Company consolidated the MetLife Core Property Fund, a newly formed open ended core real estate fund. As a result of the quarterly reassessment in the first quarter of 2014, it was determined that the MetLife Core Property Fund no longer meets the requirements of a consolidated VIE; accordingly, it will be deconsolidated effective March 31, 2014. See Note 8. 172 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Schedule I Consolidated Summary of Investments -- Other Than Investments in Related Parties December 31, 2013 (In millions)
Amount at Cost or Estimated Fair Which Shown on Types of Investments Amortized Cost (1) Value Balance Sheet -------------------- ------------------ -------------- -------------- Fixed maturity securities: Bonds: Foreign government securities................ $ 3,040 $ 3,530 $ 3,530 U.S. Treasury and agency securities.......... 29,508 30,544 30,544 Public utilities............................. 14,765 16,267 16,267 State and political subdivision securities... 5,386 5,777 5,777 All other corporate bonds.................... 71,126 75,299 75,299 ------------ ------------ ------------ Total bonds.................................. 123,825 131,417 131,417 Mortgage-backed and asset-backed securities.. 40,111 40,910 40,910 Redeemable preferred stock................... 1,435 1,419 1,419 ------------ ------------ ------------ Total fixed maturity securities.............. 165,371 173,746 173,746 ------------ ------------ ------------ Trading and fair value option securities..... 718 723 723 ------------ ------------ ------------ Equity securities: Common stock: Industrial, miscellaneous and all other...... 1,070 1,164 1,164 Non-redeemable preferred stock............... 743 728 728 ------------ ------------ ------------ Total equity securities...................... 1,813 1,892 1,892 ------------ ------------ ------------ Mortgage loans: Held-for-investment.......................... 46,021 46,021 Held-for-sale................................ 3 3 ------------ ------------ Mortgage loans, net.......................... 46,024 46,024 ------------ ------------ Policy loans................................. 8,421 8,421 Real estate and real estate joint ventures... 7,449 7,449 Real estate acquired in satisfaction of debt. 349 349 Other limited partnership interests.......... 4,716 4,716 Short-term investments....................... 5,962 5,962 Other invested assets........................ 10,589 10,589 ------------ ------------ Total investments............................ $ 251,412 $ 259,871 ============ ============
-------- (1)The Company's trading and fair value option securities portfolio is mainly comprised of fixed maturity and equity securities, including mutual funds and, to a lesser extent, short-term investments and cash and cash equivalents. Cost or amortized cost for fixed maturity securities and mortgage loans held-for-investment represents original cost reduced by repayments, valuation allowances and impairments from other-than-temporary declines in estimated fair value that are charged to earnings and adjusted for amortization of premiums or accretion of discounts; for equity securities, cost represents original cost reduced by impairments from other-than-temporary declines in estimated fair value; for real estate, cost represents original cost reduced by impairments and adjusted for valuation allowances and depreciation; for real estate joint ventures and other limited partnership interests cost represents original cost reduced for impairments or original cost adjusted for equity in earnings and distributions. 173 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Schedule III Consolidated Supplementary Insurance Information December 31, 2013, 2012 and 2011 (In millions)
Future Policy Benefits, Other Policy-Related DAC Balances and Policyholder Policyholder and Policyholder Dividend Account Dividends Unearned Unearned Segment VOBA Obligation Balances Payable Premiums (1), (2) Revenue (1) ------- -------- ----------------------- ------------ ------------ ----------------- ----------- 2013 Retail.............. $ 5,990 $ 62,912 $ 30,434 $ 601 $ 36 $ 507 Group, Voluntary & Worksite Benefits. 333 19,460 8,575 -- 236 -- Corporate Benefit Funding........... 93 36,452 53,489 -- -- 31 Corporate & Other... -- 581 -- -- 1 -- -------- ---------- --------- ------ ------ ------ Total............... $ 6,416 $ 119,405 $ 92,498 $ 601 $ 273 $ 538 ======== ========== ========= ====== ====== ====== 2012 Retail.............. $ 5,407 $ 64,757 $ 31,393 $ 610 $ 36 $ 539 Group, Voluntary & Worksite Benefits. 337 19,599 8,918 -- 248 -- Corporate Benefit Funding........... 88 38,645 54,406 -- -- 38 Corporate & Other... -- 476 (1) -- -- -- -------- ---------- --------- ------ ------ ------ Total............... $ 5,832 $ 123,477 $ 94,716 $ 610 $ 284 $ 577 ======== ========== ========= ====== ====== ====== 2011 Retail.............. $ 5,921 $ 63,460 $ 31,811 $ 659 $ 38 $ 556 Group, Voluntary & Worksite Benefits. 342 18,207 9,273 -- 226 -- Corporate Benefit Funding........... 76 36,004 47,748 -- -- 47 Corporate & Other... 2 457 24 -- -- -- -------- ---------- --------- ------ ------ ------ Total............... $ 6,341 $ 118,128 $ 88,856 $ 659 $ 264 $ 603 ======== ========== ========= ====== ====== ======
-------- (1)Amounts are included within the future policy benefits, other policy-related balances and policyholder dividend obligation column. (2)Includes premiums received in advance. 174 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Schedule III -- (Continued) Consolidated Supplementary Insurance Information December 31, 2013, 2012 and 2011 (In millions)
Policyholder Benefits and Premium Claims and Amortization of Revenue Net Interest Credited DAC and VOBA Other and Policy Investment to Policyholder Charged to Operating Segment Charges Income Account Balances Other Expenses Expenses (1) ------- ---------- ---------- ----------------- --------------- ------------ 2013 Retail............................... $ 5,456 $ 5,067 $ 6,059 $ 217 $ 2,971 Group, Voluntary & Worksite Benefits. 14,420 1,618 13,346 25 1,970 Corporate Benefit Funding............ 2,886 4,680 5,813 19 474 Corporate & Other.................... 76 420 67 -- 1,517 --------- --------- --------- ------ -------- Total................................ $ 22,838 $ 11,785 $ 25,285 $ 261 $ 6,932 ========= ========= ========= ====== ======== 2012 Retail............................... $ 5,379 $ 5,113 $ 6,121 $ 948 $ 3,067 Group, Voluntary & Worksite Benefits. 13,937 1,540 12,747 29 1,878 Corporate Benefit Funding............ 2,802 4,636 5,792 12 421 Corporate & Other.................... 1 563 (1) 2 1,332 --------- --------- --------- ------ -------- Total................................ $ 22,119 $ 11,852 $ 24,659 $ 991 $ 6,698 ========= ========= ========= ====== ======== 2011 Retail............................... $ 5,397 $ 5,183 $ 6,099 $ 765 $ 3,302 Group, Voluntary & Worksite Benefits. 13,117 1,545 12,058 95 1,753 Corporate Benefit Funding............ 1,975 4,478 4,892 14 461 Corporate & Other.................... 1 409 4 1 1,435 --------- --------- --------- ------ -------- Total................................ $ 20,490 $ 11,615 $ 23,053 $ 875 $ 6,951 ========= ========= ========= ====== ========
-------- (1)Includes other expenses and policyholder dividends, excluding amortization of deferred policy acquisition costs ("DAC") and value of business acquired ("VOBA") charged to other expenses. 175 Metropolitan Life Insurance Company (A Wholly-Owned Subsidiary of MetLife, Inc.) Schedule IV Consolidated Reinsurance December 31, 2013, 2012 and 2011 (In millions)
% Amount Gross Amount Ceded Assumed Net Amount Assumed to Net ------------ ---------- ---------- ------------ -------------- 2013 Life insurance in-force....... $ 2,940,853 $ 401,576 $ 844,946 $ 3,384,223 25.0% ============ ========== ========== ============ Insurance premium Life insurance................ $ 13,820 $ 1,187 $ 1,423 $ 14,056 10.1% Accident and health insurance. 6,470 97 46 6,419 0.7% ------------ ---------- ---------- ------------ Total insurance premium....... $ 20,290 $ 1,284 $ 1,469 $ 20,475 7.2% ============ ========== ========== ============ 2012 Life insurance in-force....... $ 2,914,815 $ 417,026 $ 785,391 $ 3,283,180 23.9% ============ ========== ========== ============ Insurance premium Life insurance................ $ 18,982 $ 756 $ 794 $ 19,020 4.2% Accident and health insurance. 839 535 556 860 64.6% ------------ ---------- ---------- ------------ Total insurance premium....... $ 19,821 $ 1,291 $ 1,350 $ 19,880 6.8% ============ ========== ========== ============ 2011 Life insurance in-force....... $ 2,883,535 $ 436,286 $ 766,216 $ 3,213,465 23.8% ============ ========== ========== ============ Insurance premium Life insurance................ $ 17,572 $ 862 $ 694 $ 17,404 4.0% Accident and health insurance. 863 525 546 884 61.8% ------------ ---------- ---------- ------------ Total insurance premium....... $ 18,435 $ 1,387 $ 1,240 $ 18,288 6.8% ============ ========== ========== ============
For the year ended December 31, 2013, reinsurance ceded and assumed included affiliated transactions for life insurance in-force of $26.1 billion and $259.6 billion, respectively, and life insurance premiums of $45 million and $451 million, respectively. For the year ended December 31, 2012, reinsurance ceded and assumed included affiliated transactions for life insurance in-force of $27.4 billion and $230.6 billion, respectively, and life insurance premiums of $54 million and $319 million, respectively. For the year ended December 31, 2011, reinsurance ceded and assumed included affiliated transactions for life insurance in-force of $28.7 billion and $189.6 billion, respectively, and life insurance premiums of $51 million and $169 million, respectively. Previously reported life insurance in-force amounts for reinsurance ceded for the years ended December 31, 2012 and 2011 have been reduced by $1,551.9 billion and $1,427.0 billion, respectively, to remove the effects of transactions with a subsidiary for life insurance in-force and certain reinsurance agreements recorded using the deposit method of accounting. The related 2012 and 2011 net amounts illustrated in the table above have also been amended by the same amounts. The Company believes the effects of these reductions are immaterial to the prior periods. 176 Metropolitan Life Separate Account UL PART C: OTHER INFORMATION ITEM 26. EXHIBITS (a) Resolution of the Board of Directors of Metropolitan Life effecting the establishment of Metropolitan Life Separate Account UL 5 (b) Not Applicable (c) (i) Not Applicable (ii) Form of Selected Broker Agreement 4 (iii) Schedule of Sales Commissions 1 (iv) Form of Retail Sales Agreement 15 (v) Principal Underwriting Agreement with MLIDC 17 (vi) Enterprise Sales Agreement between MetLife Investors Distribution Company and broker-dealers dated February 2010 20 (vii) Master Retail Sales Agreement between MetLife Investors Distribution Company and broker- dealers dated September 2012 23 (d) (i) Specimen Flexible Premium Variable Life Insurance Policy 4 (ii) Alternative pages required by state law 4 (iii) Endorsement for calculation of minimum death benefit using the Cash Value Accumulation test 4 (iv) Accelerated Death Benefit and Zero Cost Loan Riders 4 (v) Yearly Renewable Term rider 3 (vi) Refund of sales load rider 3 (vii) Amended Policy Specifications Page indicating alternate premium expense charges 3 (viii) Enhanced Cash Surrender Value Rider 11 (ix) Term Insurance Rider 13 (e) Amended Application Forms for Policy and Form of Receipt (including State variations) 4 (f) (i) Restated Charter and By-Laws of Metropolitan Life 8 (ii) Amended and Restated By-Laws of Metropolitan Life 17 (g) Reinsurance Contracts 12 (h) (i) Participation Agreements with INVESCO and Janus Aspen 7 (ii) Participation Agreement with Templeton Variable 7 (iii) Participation Agreements with Alliance 9 (iv) Participation Agreement with Met Investors Series Trust 10 (v) Participation Agreement with Fidelity Investments 6 (vi) Supplemental Agreements with Fidelity Investments 9 (vii) Participation Agreements with AIM, American Century, Dreyfus, Templeton, Goldman Sachs, MFS, Janus and Wells Fargo 13 (viii) Participation Agreement among Metropolitan Series Fund, Inc., MetLife Advisers, LLC and Metropolitan Life Insurance Company (8/31/07) 16 (ix) Amended and Restated Participation Agreement and First Amendment with Fidelity Variable Insurance Products funds I, II, III, IV and V 18 (x) First & Second Amendments to the Participation Agreement with Met Investors Series Trust 19 (xi) Amendments to the Participation Agreements for AIM/Invesco, American Century, American Funds, Fidelity, Franklin Templeton, Legg Mason, and Royce. 21 (xii) Amendments to the Participation Agreements with AllianceBernstein Variable Products Series Fund, Inc., Dreyfus Variable Investment Fund, Franklin Templeton Variable Insurance Products Trust, Goldman Sachs Variable Insurance Trust, Janus Aspen Series, Met Investors Series Trust, Metropolitan Series Fund, MFS Variable Insurance Trust, Oppenheimer Variable Account Funds, PIMCO Variable Insurance Trust, Pioneer Variable Contracts Trust. 22 (xiii) Amendments to the Participation Agreements with Franklin Templeton Variable Insurance Products Trust and Wells Fargo Variable Trust 24 (ix) Amendments to the Participation Agreements with Franklin Templeton Variable Insurance Products Trust, Janus Aspen Series and Legg Mason Partners Variable Equity Trust and Legg Mason Partners Variable Income Trust (Filed herewith) (i) Not Applicable (j) Not Applicable (k) Opinion and Consent of Marie C. Swift as to the legality of the securities being registered 14 (l) Not Applicable (m) Not Applicable (n) Consent of Independent Registered Public Accounting Firm (Filed herewith) (o) Not Applicable (p) Not Applicable (q) (i) Memoranda describing certain procedures filed pursuant to Rule 6e-3(T)(b)(12)(iii) 4 (r) Powers of Attorney (Filed herewith)
1 Incorporated by reference from "Sales and Administration of the Policies" in the Prospectuses included herein and "Distribution of the Policies" in the Statement of Additional Information. 2 Incorporated herein by reference to Post-Effective Amendment No. 4 to this Registration Statement (File No. 033-57320) filed March 1, 1996. 3 Incorporated herein by reference to Post-Effective Amendment No. 5 to the Registration Statement (File No. 033-57320) filed on April 26,1996. 4 Incorporated herein by reference to Post-Effective Amendment No. 6 to the Registration Statement (File No. 033-57320) filed on April 30, 1997. 5 Incorporated herein by reference to Post-Effective Amendment No. 5 to the Registration Statement of Separate Account UL (File No. 33-47927) filed on April 30, 1997. 6 Incorporated herein by reference to Post-Effective Amendment No. 26 to the Registration Statement of MetLife Separate Account E (File No. 002-90380) on Form N-4 filed on April 30, 1997. 7 Incorporated herein by reference to Post-Effective Amendment No. 8 to the Registration Statement (File No. 033-57320) filed on April 23, 1999. 8 Incorporated herein by reference to Post-Effective Amendment No. 3 to the Registration Statement (File No. 333-40161) filed on April 6, 2000. 9 Incorporated herein by reference to Post-Effective Amendment No. 10 to the Registration Statement (File No. 033-57320) filed on September 18, 2000. 10 Incorporated herein by reference to the Registration Statement for MetLife Separate Account E (File No. 333-83716) filed on March 5, 2002. 11 Incorporated herein by reference to Post-Effective Amendment No. 12 to the Registration Statement (File No. 033-57320) filed on April 22, 2002. 12 Incorporated herein by reference to Post-Effective Amendment No. 18 to the Registration Statement (File No. 033-47927) filed on April 30, 2004. 13 Incorporated herein by reference to Post-Effective Amendment No. 16 to the Registration Statement (File No. 033-57320) filed on April 30, 2004. 14 Incorporated herein by reference to the Post-Effective Amendment No. 17 to the Registration Statement on Form N-6 (033-57320) filed on April 28, 2005. 15 Incorporated herein by reference to the Post-Effective Amendment No. 20 to the Registration Statement on Form N-6 (033-47927) filed on April 25, 2006. 16 Incorporation herein by reference to Post-Effective Amendment No. 9 to Metropolitan Life Separate Account E's Registration Statement on Form N-4 (File No. 333-83716) filed September 10, 2007. 17 Incorporation herein by reference to Post-Effective Amendment No. 3 to Paragon Separate Account B's Registration Statement on Form N-6 (File No. 333-133675) filed January 16, 2008. 18 Incorporated herein by reference to Post-Effective Amendment No. 20 to the Registrant's Registration Statement on Form N-6 (File No. 033-57320) filed April 18, 2008. 19 Incorporated herein by reference to Post-Effective Amendment No. 22 to the Registrant's Registration Statement on Form N-6 (File No. 033-57320) filed April 16, 2009. 20 Incorporated herein by reference to Exhibit 3(b)(ii) in Post-Effective Amendment No. 14 to the MetLife Separate Account E's Registration Statement on Form N-4 (File No. 333-83716) as filed April 13, 2010. 21 Incorporated herein by reference to Post-Effective Amendment No. 24 to the Registrant's Registration Statement on Form N-6 (File No. 033-57320) filed April 14, 2011. 22 Incorporated herein by reference to Post-Effective Amendment No. 25 to the Registrant's Registration Statement on Form N-6 (File No. 033-57320) filed April 12, 2012. 23 Incorporated herein by reference to Post-Effective Amendment No. 27 to the Registrant's Registration Statement on Form N-6 (File No. 033-47927) filed April 11, 2013. 24 Incorporated herein by reference to Post-Effective No. 26 to the Registrant's Registration Statement on Form N-6 (File No. 033-57320) filed April 11, 2013.
ITEM 27. DIRECTORS AND OFFICERS OF DEPOSITOR
NAME AND PRINCIPAL BUSINESS ADDRESS POSITIONS AND OFFICES WITH DEPOSITOR ----------------------------------- ----------------------------------------------------------------- Steven A. Kandarian Chairman of the Board, President and Chief Executive Officer and MetLife, Inc, and Metropolitan Life Insurance a Director Company 200 Park Avenue New York, NY 10166 Cheryl W. Grise Director c/o MetLife, Inc. and Metropolitan Life Insurance Company 200 Park Avenue New York, NY 10166 Carlos M. Gutierrez Director Vice Chairman Albright Stonebridge Group 555 Thirteenth Street, NW, Suite 300 West Washington, DC 20004 R. Glenn Hubbard Director Dean of Graduate School of Business and Russell L. Carson Professor of Finance and Economics Columbia University Uris Hall 3022 Broadway New York, NY 10027-6902
NAME AND PRINCIPAL BUSINESS ADDRESS POSITIONS AND OFFICES WITH DEPOSITOR ----------------------------------- ------------------------------------ John M. Keane Director Senior Partner SCP Partners 2020 K St., N.W., Suite 300 Washington, DC 20006 Alfred F. Kelly, Jr. Director Chairman of the Board, President and Chief Executive Officer NY/NJ Super Bowl Host Company MetLife Stadium One MetLife Stadium Drive East Rutherford, NJ 07073 William E. Kennard Director c/o MetLife, Inc. and Metropolitan Life Insurance Company 200 Park Avenue New York, NY 10166 James M. Kilts Director Partner Centerview Partners Management, LLC 3 Greenwich Office Park 2nd Floor Greenwich, CT 06831 Catherine R. Kinney Director c/o MetLife, Inc. and Metropolitan Life Insurance Company 200 Park Avenue New York, NY 10166 Denise M. Morrison Director President and Chief Executive Officer Campbell Soup Company One Campbell Place Camden, NJ 08103 Hugh B. Price Director Professor of Public and International Affairs Woodrow Wilson School Princeton University Princeton, NJ 08544-1013 Kenton J. Sicchitano Director c/o MetLife, Inc. and Metropolitan Life Insurance Company 200 Park Avenue New York, NY 10166
NAME AND PRINCIPAL BUSINESS ADDRESS POSITIONS AND OFFICES WITH DEPOSITOR ----------------------------------- ------------------------------------ Lulu C. Wang Director Chief Executive Officer Tupelo Capital Management LLC 340 Madison Avenue, 19th Floor New York, NY 10173
Set forth below is a list of certain principal officers of Metropolitan Life Insurance Company. The principal business address of each principal officer is 1095 Avenue of the Americas, New York, NY 10036.
NAME POSITIONS WITH DEPOSITOR ---- ---------------------------------------------------------------------------- Steven A. Kandarian Chairman of the Board, President and Chief Executive Officer and a Director Michel A. Khalaf President, Europe/Middle East/Africa Division Christopher G. Townsend President, Asia William J. Wheeler President, Americas Ricardo A. Anzaldua Executive Vice President and General Counsel Peter M. Carlson Executive Vice President and Chief Accounting Officer Steven J. Goulart Executive Vice President and Chief Investment Officer John C.R. Hele Executive Vice President and Chief Financial Officer Shailendra Ghorpade Executive Vice President Franciscus Hijkoop Executive Vice President and Chief Human Resources Officer Beth M. Hirschhorn Executive Vice President of Global Brand and Marketing William R. Hogan Executive Vice President Todd B. Katz Executive Vice President Robin Lenna Executive Vice President Martin J. Lippert Executive Vice President, Global Technology & Operations Eugene R. Marks, Jr. Executive Vice President Maria R. Morris Executive Vice President, Global Employee Benefits Anthony J.Nugent Executive Vice President Oscar Schmidt Executive Vice President Marc Sevestre Executive Vice President Peter A. Smyth Executive Vice President Eric T. Steigerwalt Executive Vice President Stanley J. Talbi Executive Vice President
ITEM 28. PERSONS CONTROLLED BY OR UNDER COMMON CONTROL WITH THE DEPOSITOR OR THE REGISTRANT The registrant is a separate account of Metropolitan Life Insurance Company under the New York Insurance law. Under said law the assets allocated to the separate account are the property of Metropolitan Life Insurance Company. Metropolitan Life Insurance Company is a wholly-owned subsidiary of MetLife, Inc. a publicly traded company. The following outline indicates those persons who are controlled by or under common control with Metropolitan Life Insurance Company: ORGANIZATIONAL STRUCTURE OF METLIFE, INC. AND SUBSIDIARIES AS OF December 31, 2013 The following is a list of subsidiaries of MetLife, Inc. updated as of December 31, 2013. Those entities which are listed at the left margin (labeled with capital letters) are direct subsidiaries of MetLife, Inc. Unless otherwise indicated, each entity which is indented under another entity is a subsidiary of that other entity and, therefore, an indirect subsidiary of MetLife, Inc. Certain inactive subsidiaries have been omitted from the MetLife, Inc. organizational listing. The voting securities (excluding directors' qualifying shares, if any) of the subsidiaries listed are 100% owned by their respective parent corporations, unless otherwise indicated. The jurisdiction of domicile of each subsidiary listed is set forth in the parenthetical following such subsidiary. A. MetLife Group, Inc. (NY) B. MetLife Home Loans LLC (DE) C. Exeter Reassurance Company, Ltd. (Cayman Islands) D. Metropolitan Tower Life Insurance Company (DE) 1. EntreCap Real Estate II LLC (DE) a) PREFCO Dix-Huit LLC (CT) b) PREFCO X Holdings LLC (CT) c) PREFCO Ten Limited Partnership (CT) - a 99.9% limited partnership interest of PREFCO Ten Limited Partnership is held by EntreCap Real Estate II LLC and 0.1% general partnership is held by PREFCO X Holdings LLC. d) PREFCO Vingt LLC (CT) e) PREFCO Twenty Limited Partnership (CT) - a 99% limited partnership interest of PREFCO Twenty Limited Partnership is held by EntreCap Real Estate II LLC and 1% general partnership is held by PREFCO Vingt LLC. 2. Plaza Drive Properties, LLC (DE) 3. MTL Leasing, LLC (DE) a) PREFCO IX Realty LLC (CT) b) PREFCO XIV Holdings LLC (CT) c) PREFCO Fourteen Limited Partnership (CT) - a 99.9% limited partnership interest of PREFCO Fourteen Limited Partnership is held by MTL Leasing, LLC and 0.1% general partnership is held by PREFCO XIV Holdings LLC. d) 1320 Venture LLC (DE) i) 1320 Owner LP (DE) - a 99.9% limited partnership of 1320 Owner LP is held by 1320 Venture LLC and 0.1% general partnership is held by 1320 GP LLC. e) 1320 GP LLC (DE) E. MetLife Chile Inversiones Limitada (Chile) - 70.4345328853% of MetLife Chile Inversiones Limitada is owned by MetLife, Inc., 26.6071557459% by American Life Insurance Company ("ALICO"), 2.9583113284% is owned by Inversiones MetLife Holdco Dos Limitada and 0.0000000404% is owned by Natilportem Holdings, Inc. 1. MetLife Chile Seguros de Vida S.A. (Chile) - 99.9969% of MetLife Chile Seguros de Vida S.A. is held by MetLife Chile Inversiones Limitada and 0.0031% by International Technical and Advisory Services Limited. a) MetLife Chile Administradora de Mutuos Hipotecarios S.A. (Chile) - 99.99% of MetLife Chile Administradora de Mutuos Hipotecarios S.A. is held by MetLife Chile Seguros de Vida S.A. and 0.01% is held by MetLife Chile Inversiones Limitada. 2. Legal Chile S.A. (Chile) - 51% of Legal Chile S.A. is owned by MetLife Chile Inversiones Limitada and the remaining interest is owned by a third party. a) Legagroup S.A. (Chile) - 99% of Legagroup S.A. is owned by Legal Chile S.A. and the remaining interest is owned by a third party. 3. Inversiones MetLife Holdco Tres Limitada (Chile) - 99.9% of Inversiones MetLife Holdco Tres Limitada is owned by MetLife Chile Inversiones Limitada and 0.1% is owned by Inversiones MetLife Holdco Dos Limitada. a) MetLife Chile Acquisition Co. S.A. (Chile) - 45% of MetLife Chile Acquisition Co. S.A. is owned by Inversiones MetLife Holdco Dos Limitada, 45% is owned by Inversiones MetLife Holdco Tres Limitada and 10% is owned by MetLife Chile Inversiones Limitada. i) Inversiones Previsionales S.A. (Chile) - 99.999% of Inversiones Previsionales S.A. is owned by MetLife Chile Acquisition Co. S.A. and 0.001% is owned by Inversiones MetLife Holdco Tres Limitada. aa) AFP Provida S.A. (Chile) - 51.62% of AFP Provida S.A. is owned by Inversiones Previsionales S.A., 21.97% is owned indirectly (by means of ADR) by MetLife Chile Acquisition Co. S.A., 17.79% is owned directly by MetLife Chile Acquisition Co. S.A. and the remainder is owned by third parties. 1) Provida Internacional S.A. (Chile) - 99.99% of Provida Internacional S.A. is owned by AFP Provida S.A. and 0.01% by Inversiones Previsionales S.A. ii) AFP Genesis Administradora de Fondos y Fidecomisos S.A. (Ecuador) - 99.9997% of AFP Genesis Administradora de Fondos y Fidecomisos S.A. is owned by Provida Internacional S.A. and 0.0003% is owned by Inversiones Previsionales S.A. 4. MetLife Chile Seguros Generales S.A. (Chile) - 99.9% of MetLife Chile Seguros Generales, S.A. is owned by MetLife Chile Inversiones Limitada and 0.1% is owned by ITAS. F. MetLife Securities, Inc. (DE) G. Enterprise General Insurance Agency, Inc. (DE) 1 H. Metropolitan Property and Casualty Insurance Company (RI) 1. Metropolitan General Insurance Company (RI) 2. Metropolitan Casualty Insurance Company (RI) 3. Metropolitan Direct Property and Casualty Insurance Company (RI) 4. MetLife Auto & Home Insurance Agency, Inc. (RI) 5. Metropolitan Group Property and Casualty Insurance Company (RI) a) Metropolitan Reinsurance Company (U.K.) Limited (United Kingdom) 6. Metropolitan Lloyds, Inc. (TX) a) Metropolitan Lloyds Insurance Company of Texas (TX)- Metropolitan Lloyds Insurance Company of Texas, an affiliated association, provides automobile, homeowner and related insurance for the Texas market. It is an association of individuals designated as underwriters. Metropolitan Lloyds, Inc., a subsidiary of Metropolitan Property and Casualty Insurance Company, serves as the attorney-in-fact and manages the association. 7. Economy Fire & Casualty Company (IL) a) Economy Preferred Insurance Company (IL) b) Economy Premier Assurance Company (IL) I. MetLife Investors Insurance Company (MO) J. First MetLife Investors Insurance Company (NY) K. Newbury Insurance Company, Limited (DE) L. MetLife Investors Group, Inc. (DE) 1. MetLife Investors Distribution Company (MO) 2. MetLife Advisers, LLC (MA) 2 M. MetLife International Holdings, Inc. (DE) 1. MetLife Mexico Cares, S.A. de C.V. (Mexico) a) Fundacion MetLife Mexico, A.C. (Mexico) 2. Natiloportem Holdings, Inc. (DE) a) Excelencia Operativa y Tecnologica, S.A. de C.V. (Mexico) i) MLA Comercial, S.A. de C.V. (Mexico) 99% is owned by Excelencia Operativa y Tecnologica, S.A. de C.V. and 1% is owned by MetLife Mexico Cares, S.A. de C.V. ii) MLA Servicios, S.A. de C.V. (Mexico) 99% is owned by Excelencia Operativa y Tecnologica, S.A. de C.V. and 1% is owned by MetLife Mexico Cares, S.A. de C.V. 3. PNB MetLife India Insurance Company Limited (India)- 26% is owned by MetLife International Holdings, Inc. and 74% is owned by third parties. 4. Metropolitan Life Insurance Company of Hong Kong Limited (Hong Kong)- 99.99935% is owned by MetLife International Holdings, Inc. and 0.00065% is owned by Natiloporterm Holdings, Inc. 5. MetLife Seguros S.A. (Argentina)- 79.3196% is owned by MetLife International Holdings, Inc., 2.6753% is owned by Natiloportem Holdings, Inc., 16.2046% by ALICO and 1.8005% by ITAS. 6. Metropolitan Life Seguros e Previdencia Privada S.A. (Brazil)- 66.662% is owned by MetLife International Holdings, Inc., 33.337% is owned by MetLife Worldwide Holdings, Inc. and 0.001% is owned by Natiloportem Holdings, Inc. 7. MetLife Global, Inc. (DE) 8. MetLife Administradora de Fundos Multipatrocinados Ltda. (Brazil) - 99.99998% of MetLife Administradora de Fundos Multipatrocinados Ltda. is owned by MetLife International Holdings, Inc. and 0.00002% by Natiloportem Holdings, Inc. 9. MetLife Services Limited (United Kingdom) 10. MetLife Seguros de Retiro S.A. (Argentina) - 95.5883% is owned by MetLife International Holdings, Inc., 3.1102% is owned by Natiloportem Holdings, Inc., 1.3014% by ALICO and 0.0001% by ITAS. 11. Best Market S.A. (Argentina) - 5% of the shares are held by Natiloportem Holdings, Inc. and 95% is owned by MetLife International Holdings Inc. 12. Compania Inversora MetLife S.A. (Argentina) - 95.46% is owned by MetLife International Holdings, Inc. and 4.54% is owned by Natiloportem Holdings, Inc. a) MetLife Servicios S.A. (Argentina) - 18.87% of the shares of MetLife Servicios S.A. are held by Compania Inversora MetLife S.A., 79.88% is owned by MetLife Seguros S.A., 0.99% is held by Natiloportem Holdings, Inc. and 0.26% is held by MetLife Seguros de Retiro S.A. 13. MetLife Worldwide Holdings, Inc. (DE) a) MetLife Direct Co., LTD. (Japan) b) MetLife Limited (Hong Kong) 14. MetLife International Limited, LLC (DE) 15. MetLife Planos Odontologicos Ltda. (Brazil) - 99.999% is owned by MetLife International Holdings, Inc. and 0.001% is owned by Natiloportem Holdings, Inc. 16. MetLife Ireland Holdings One Limited (Ireland) a) MetLife Global Holdings Corporation S.A. de C.V. (Mexico/Ireland) - 98.9% is owned by MetLife Ireland Holdings One Limited and 1.1% is owned by MetLife International Limited, LLC. i) MetLife Ireland Treasury Limited (Ireland) a) MetLife General Insurance Limited (Australia) b) MetLife Insurance Limited (Australia) - 91.16468% of MetLife Insurance Limited (Australia) is owned by MetLife Ireland Treasury Limited and 8.83532% is owned by MetLife Global Holdings Corp. S.A. de C.V. 1) The Direct Call Centre PTY Limited (Australia) 2) MetLife Investments PTY Limited (Australia) aa) MetLife Insurance and Investment Trust (Australia) - MetLife Insurance and Investment Trust is a trust vehicle, the trustee of which is MetLife Investments PTY Limited ("MIPL"). MIPL is a wholly owned subsidiary of MetLife Insurance Limited. ii) Metropolitan Global Management, LLC (DE/Ireland) - 99.7% is owned by MetLife Global Holdings Corporation S.A. de C.V. and 0.3% is owned by MetLife International Holdings, Inc. a) MetLife Pensiones Mexico S.A. (Mexico)- 97.4738% is owned by Metropolitan Global Management, LLC and 2.5262% is owned by MetLife International Holdings, Inc. b) MetLife Mexico Servicios, S.A. de C.V. (Mexico) - 98% is owned by Metropolitan Global Management, LLC and 2% is owned by MetLife International Holdings, Inc. c) MetLife Mexico S.A. (Mexico)- 99.050271% is owned by Metropolitan Global Management, LLC and 0.949729% is owned by MetLife International Holdings, Inc. 1) MetLife Afore, S.A. de C.V. (Mexico)- 99.99% is owned by MetLife Mexico S.A. and 0.01% is owned by MetLife Pensiones Mexico S.A. aa) Met1 SIEFORE, S.A. de C.V. (Mexico)- 99.99% is owned by MetLife Afore, S.A. de C.V. and 0.01% is owned by MetLife Mexico S.A. bb) Met2 SIEFORE, S.A. de C.V. (Mexico)- 99.99% is owned by MetLife Afore, S.A. de C.V. and 0.01% is owned by MetLife Mexico S.A. cc) MetA SIEFORE Adicional, S.A. de C.V. (Mexico)- 99.99% is owned by MetLife Afore, S.A. de C.V. and 0.01% is owned by MetLife Mexico S.A. dd) Met3 SIEFORE Basica, S.A. de C.V. (Mexico) - 99.99% is owned by MetLife Afore, S.A. de C.V. and 0.01% is owned by MetLife Mexico S.A. ee) Met4 SIEFORE, S.A. de C.V. (Mexico) - 99.99% is owned by MetLife Afore, S.A. de C.V. and 0.01% is owned by MetLife Mexico S.A. ff) Met5 SIEFORE, S.A. de C.V. (Mexico) - 99.99% is owned by MetLife Afore, S.A. de C.V. and 0.01% is owned by MetLife Mexico S.A. 2) ML Capacitacion Comercial S.A. de C.V.(Mexico) - 99% is owned by MetLife Mexico S.A. and 1% is owned by MetLife Mexico Cares, S.A. de C.V. d) MetLife Saengmyoung Insurance Co. Ltd. (also known as MetLife Insurance Company of Korea Limited) (South Korea)- 14.64% is owned by MetLife Mexico, S.A. and 85.36% is owned by Metropolitan Global Management, LLC. e) Bolpyr S.A. (Uruguay) 17. MetLife Asia Pacific Limited (Hong Kong) N. Metropolitan Life Insurance Company (MLIC) (NY) 1. 334 Madison Euro Investments, Inc. (DE) 2. St. James Fleet Investments Two Limited (Cayman Islands) a) Park Twenty Three Investments Company (United Kingdom) i) Convent Station Euro Investments Four Company (United Kingdom) aa) OMI MLIC Investments Limited (Cayman Islands) 3. CRB Co., Inc. (MA) 4. MLIC Asset Holdings II LLC (DE) a) El Conquistador MAH II LLC (DE) b) Mansell Office LLC (DE) - 73.0284% of Mansell Office LLC is owned by MLIC Asset Holdings II LLC and 26.9716% is owned by MLIC CB Holdings LLC. c) Mansell Retail LLC (DE) - 73.0284% of Mansell Retail LLC is owned by MLIC Asset Holdings II LLC and 26.9716% is owned by MLIC CB Holdings LLC. 3 5. CC Holdco Manager (DE) 6. Alternative Fuel I, LLC (DE) 7. Transmountain Land & Livestock Company (MT) 8. MetPark Funding, Inc. (DE) 9. HPZ Assets LLC (DE) 10. Missouri Reinsurance, Inc. (Cayman Islands) 11. Metropolitan Tower Realty Company, Inc. (DE) a) Midtown Heights, LLC (DE) 12. MetLife Real Estate Cayman Company (Cayman Islands) 13. MetLife RC SF Member, LLC (DE) 14. MetLife Private Equity Holdings, LLC (DE) 15. 23rd Street Investments, Inc. (DE) a) MetLife Capital Credit L.P. (DE)- 1% General Partnership interest is held by 23rd Street Investments, Inc. and 99% Limited Partnership interest is held by Metropolitan Life Insurance Company. b) MetLife Capital, Limited Partnership (DE)- 1% General Partnership interest is held by 23rd Street Investments, Inc. and 99% Limited Partnership interest is held by Metropolitan Life Insurance Company. i) Long Island Solar Farm, LLC (DE) - 9.61% membership interest is held by MetLife Renewables Holding, LLC and 90.39% membership interest is held by LISF in which MetLife Capital Limited Partnership has 100% beneficial interest. 16. Hyatt Legal Plans, Inc. (DE) a) Hyatt Legal Plans of Florida, Inc. (FL) 17. MetLife Holdings, Inc. (DE) a) MetLife Credit Corp. (DE) b) MetLife Funding, Inc. (DE) 4 18. MetLife Investments Asia Limited (Hong Kong) 19. MetLife Investments Limited (United Kingdom)- 23rd Street Investments, Inc. holds one share of MetLife Investments Limited. 20. MetLife Latin America Asesorias e Inversiones Limitada (Chile)- 23rd Street Investments, Inc. holds 0.01% of MetLife Latin America Asesorias e Inversiones Limitada. 21. New England Life Insurance Company (MA) a) New England Securities Corporation (MA) 22. General American Life Insurance Company (MO) a) GALIC Holdings LLC (DE) 5 23. Corporate Real Estate Holdings, LLC (DE) 24. Ten Park SPC (Cayman Islands) - 1% voting control of Ten Park SPC is held by 23rd Street Investments, Inc. 25. MetLife Tower Resources Group, Inc. (DE) 26. Headland-Pacific Palisades, LLC (CA) 27. Headland Properties Associates (CA) - 1% is owned by Headland-Pacific Palisades, LLC and 99% is owned by Metropolitan Life Insurance Company. 28. WFP 1000 Holding Company GP, LLC (DE) 29. White Oak Royalty Company (OK) 30. 500 Grant Street GP LLC (DE) 31. 500 Grant Street Associates Limited Partnership (CT) - 99% of 500 Grant Street Associates Limited Partnership is held by Metropolitan Life Insurance Company and 1% by 500 Grant Street GP LLC. 32. MetLife Mall Ventures Limited Partnership (DE) - 99% LP interest of MetLife Mall Ventures Limited Partnership is owned by MLIC and 1% GP interest is owned by Metropolitan Tower Realty Company, Inc. a) HMS Master Limited Partnership (DE) - 60% LP interest of HMS Master Limited Partnership is owned by MetLife Mall Ventures Limited Partnership. A 40% LP interest is owned by a third party. Metropolitan Tower Realty Company, Inc. is the GP. i) HMS Southpark Residential LLC (DE) 33. MetLife Retirement Services LLC (NJ) a) MetLife Investment Funds Services LLC (NJ) i) MetLife Associates LLC (DE) 34. Euro CL Investments LLC (DE) 35. MEX DF Properties, LLC (DE) 36. MSV Irvine Property, LLC (DE) - 4% of MSV Irvine Property, LLC is owned by Metropolitan Tower Realty Company, Inc. and 96% is owned by Metropolitan Life Insurance Company 37. MetLife Properties Ventures, LLC (DE) a) Citypoint Holdings II Limited (United Kingdom) 38. Housing Fund Manager, LLC (DE) a) MTC Fund I, LLC (DE) - 0.01% of MTC Fund I, LLC is held by Housing Fund Manager, LLC. - Housing Fund Manager, LLC is the managing member LLC and the remaining interests are held by a third party member. b) MTC Fund II, LLC (DE) - 0.01% of MTC Fund II, LLC is held by Housing Fund Manager, LLC. - Housing Fund Manager, LLC is the managing member LLC and the remaining interests are held by a third party member. c) MTC Fund III, LLC (DE) - 0.01% of MTC Fund III, LLC is held by Housing Fund Manager, LLC. - Housing Fund Manager, LLC is the managing member LLC and the remaining interests are held by a third party member. 39. MLIC Asset Holdings LLC (DE) 40. 85 Broad Street Mezzanine LLC (DE) a) 85 Broad Street LLC (DE) 41. The Building at 575 Fifth Avenue Mezzanine LLC (DE) a) The Building at 575 Fifth LLC (DE) 42. ML Bridgeside Apartments LLC (DE) 43. Para-Met Plaza Associates (FL)- 75% of the General Partnership is held by Metropolitan Life Insurance Company and 25% of the General Partnership is held by Metropolitan Tower Realty Company, Inc. 44. MLIC CB Holdings LLC (DE) 45. Met II Office Mezzanine LLC (FL) - 10.4167% of the membership interest is owned by Metropolitan Tower Life Insurance Company and 89.5833% is owned by Metropolitan Life Insurance Company. a) Met II Office, LLC (FL) 46. The Worthington Series Trust (DE) 47. MetLife CC Member, LLC (DE) - 63.415% of MetLife CC Member, LLC is held by Metropolitan Life Insurance Company, 17.073% by MetLife Investors USA Insurance Company, 14.634% by MetLife Insurance Company of Connecticut and 4.878% by General American Life Insurance Company. 48. Oconee Hotel Company, LLC (DE) 49. Oconee Land Company, LLC (DE) a) Oconee Land Development Company, LLC (DE) b) Oconee Golf Company, LLC (DE) c) Oconee Marina Company, LLC (DE) 50. 1201 TAB Manager, LLC (DE) 51. MetLife 1201 TAB Member, LLC (DE) - 69.66% of MetLife 1201 TAB Member, LLC is owned by Metropolitan Life Insurance Company, 12.07% is owned by MetLife Investors USA Insurance Company, 15.17% is owned by MetLife Insurance Company of Connecticut and 3.1% is owned by Metropolitan Property and Casualty Insurance Company. a) 1201 TAB Owner, LLC (DE) - 50% of 1201 TAB Owner, LLC is owned by Metlife 1201 TAB Member, LLC and the remainder is owned by a third party. Metlife 1201 TAB Manager, LLC is the manager of 1201 TAB Owner, LLC. 52. MetLife LHH Member, LLC (DE) - 69.23% of MetLife LHH Member, LLC is owned by Metropolitan Life Insurance Company, 19.78% is owned by MetLife Investors USA Insurance Company and 10.99% is owned by New England Life Insurance Company. 53. Ashton Southend GP, LLC (DE) 54. Tremont Partners, LP (DE) - 99.9% LP interest of Tremont Partners, LP is owned by Metropolitan Life Insurance Company and 0.1% GP interest is owned by Ashton Southend GP, LLC. 55. Riverway Residential, LP (DE) - 99.9% LP interest of Riverway Residential, LP is owned by Metropolitan Life Insurance Company and 0.1% GP interest is owned by Metropolitan Tower Realty Company, Inc. 56. 10420 McKinley Partners, LP (DE) - 99.9% LP interest of 10420 McKinley Partners, LP is owned by Metropolitan Life Insurance Company and 0.1% GP interest is owned by Metropolitan Tower Realty Company, Inc. 57. Ardrey Kell Townhomes, LLC (DE) 58. Boulevard Residential, LLC (DE) 59. 465 N. Park Drive, LLC (DE) 60. Ashton Judiciary Square, LLC (DE) 61. Sandpiper Cove Associates, LLC (DE) - 90.59% membership interest of Sandpiper Cove Associates, LLC is owned by MLIC and 9.41% is owned by Metropolitan Tower Realty Company. 62. 1900 McKinley Properties, LP (DE) - 99.9% LP interest of 1900 McKinley Properties, LP is owned by MLIC and 0.1% GP interest is owned by Metropolitan Tower Realty Company, Inc. 63. Marketplace Residences, LLC (DE) 64. ML Swan Mezz, LLC (DE) a) ML Swan GP, LLC (DE) 65. ML Dolphin Mezz, LLC (DE) a) ML Dolphin GP, LLC (DE) 66. Haskell East Village, LLC (DE) 67. MetLife Cabo Hilton Member, LLC (DE) - 54.129% of MetLife Cabo Hilton Member, LLC is owned by MLIC, 16.9% by General American Life Insurance Company, 16.9% by MetLife Investors USA Insurance Company and 12.071% by MetLife Insurance Company of Connecticut. 68. ML Terraces, LLC (DE) 69. Chestnut Flats Wind, LLC (DE) 70. MetLife 425 MKT Member, LLC (DE) 71. MetLife OFC Member, LLC (DE) a) OFC Boston, LLC (DE) - 52.5% of OFC Boston, LLC is owned by MetLife OFC Member, LLC and 47.5% is owned by a third party. i) OFC REIT, LLC (DE) 1) Dewey Square Tower Associates, LLC (MA) 72. MetLife THR Investor, LLC (DE) - 85% of MetLife THR Investors, LLC is owned by MLIC and 15% is owned by MICC. 73. ML Southmore, LLC (DE) - 75.12% of ML Southmore, LLC is owned by MLIC and 24.88% is owned by MICC. 74. ML - AI MetLife Member 1, LLC (DE) - 83.675% of the membership interest is owned by MLIC, 5.762% by MLI USA and 4.801% by Metropolitan Property and Casualty Insurance Company. a) ML - AI Venture 1, LLC (DE) - 51% of ML-AI Venture 1, LLC is owned by ML-AI MetLife Member 1, LLC and 49% is owned by a third party. MetLife Investment Management, LLC is the asset manager. i) ML-AI 125 Wacker, LLC (DE) 75. MetLife CB W/A, LLC (DE) 76. MetLife Camino Ramon Member, LLC (DE) - 78.6% of MetLife Camino Ramon Member, LLC is owned by MLIC and 21.4% is owned by MICC. O. MetLife Capital Trust IV (DE) P. MetLife Insurance Company of Connecticut (MICC) (CT) - 86.72% is owned by MetLife, Inc. and 13.28% by MetLife Investors Group, Inc. 1. MetLife Property Ventures Canada ULC (Canada) 2. Pilgrim Alternative Investments Opportunity Fund III Associates, LLC (CT) - 67% is owned by MetLife Insurance Company of Connecticut and 33% is owned by third party. 3. Metropolitan Connecticut Properties Ventures, LLC (DE) 4. MetLife Canadian Property Ventures LLC (NY) 5. Euro TI Investments LLC (DE) 6. Greenwich Street Investments, L.L.C. (DE) a) Greenwich Street Capital Offshore Fund, Ltd. (Virgin Islands) b) Greenwich Street Investments, L.P. (DE) 7. One Financial Place Corporation (DE) - 100% is owned in the aggregate by MetLife Insurance Company of Connecticut. 8. Plaza LLC (CT) 9. TIC European Real Estate LP, LLC (DE) 10. MetLife European Holdings, LLC (DE) a) MetLife Assurance Limited (United Kingdom) 11. Travelers International Investments Ltd. (Cayman Islands) 12. Euro TL Investments LLC (DE) 13. Corrigan TLP LLC (DE) 14. TLA Holdings LLC (DE) a) The Prospect Company (DE) 15. TRAL & Co. (CT) - TRAL & Co. is a general partnership. Its partners are MetLife Insurance Company of Connecticut and Metropolitan Life Insurance Company. 16. MetLife Investors USA Insurance Company (MLI USA) (DE) a) MetLife Renewables Holding, LLC (DE) i) Greater Sandhill I, LLC (DE) 17. TLA Holdings II LLC (DE) 18. TLA Holdings III LLC (DE) 19. MetLife Greenstone Southeast Venture, LLC (DE) - 95% of MetLife Greenstone Southeast Venture, LLC is owned by MetLife Insurance Company of Connecticut and 5% is owned by Metropolitan Connecticut Properties Ventures, LLC. a) MLGP Lakeside, LLC (DE) Q. MetLife Reinsurance Company of South Carolina (SC) R. MetLife Investment Management, LLC (DE) 1. MetLife International PE Fund I GP LLC (DE) a) MetLife International PE Fund I, LP (Cayman Islands) - 92.5935% of the Limited Partnership interests of this entity is owned by MetLife Alico Life Insurance K.K., 4.115% is owned by MetLife Mexico S.A., 2.716% is owned by MetLife Limited (Hong Kong) and the remaining 0.576% is owned by Metropolitan Life Insurance Company of Hong Kong Limited. 2. MetLife Loan Asset Management LLC (DE) 3. MetLife Core Property Fund GP, LLC (DE) a) MetLife Core Property Fund, LP (DE) - MetLife Core Property Fund GP, LLC is the general partner of MetLife Core Property Fund, LP (the "Fund"). A substantial majority of the limited partnership interests in the Fund are held by third parties. The following affiliates hold a minority share of the limited partnership interests in the Fund: Metropolitan Life Insurance Company owns 23.7%, General American Life Insurance Company owns 0.1% and MetLife Insurance Company of Connecticut owns 0.2%. i) MetLife Core Property REIT, LLC (DE) aa) MetLife Core Property Holdings, LLC (DE) - MetLife Core Property Holdings, LLC holds the following single-property limited liability companies: MCP 7 Riverway, LLC, MCP SoCal Industry- Redondo, LLC, MCP SoCal Industrial-Springdale, LLC, MCP SoCal Industrial-Concourse, LLC, MCP SoCal Industrial-Kellwood, LLC, MCP SoCal Industrial-Bernado, LLC, MCP SoCal Industrial-Canyon, LLC, MCP SoCal Industrial-Anaheim, LLC, MCP SoCal Industrial-LAX, LLC, MCP SoCal Industrial-Fullerton, LLC, MCP SoCal Industrial-Ontario, LLC, MCP SoCal Industrial-Loker, LLC, MCP Paragon Point, LLC, MCP 4600 South Syracuse, LLC, MCP The Palms Doral, LLC, MCP Waterfront Atrium, LLC, MCP EnV Chicago, LLC,MCP 100 Congress, LLC, MCP 1900 McKinney, LLC, MCP 550 West Washington, LLC, MCP Main Street Village, LLC, MCP Lodge At Lakecrest, LLC and MCP Ashton South End, LLC S. MetLife Standby I, LLC (DE) 1. MetLife Exchange Trust I (DE) T. MetLife Services and Solutions, LLC (DE) 1. MetLife Solutions Pte. Ltd. (Singapore) a) MetLife Services East Private Limited (India) b) MetLife Global Operations Support Center Private Limited (India) - 99.99999% is owned by MetLife Solutions Pte. Ltd. and 0.00001% is owned by Natiloportem Holdings, Inc. U. SafeGuard Health Enterprises, Inc. (DE) 1. MetLife Health Plans, Inc. (DE) 2. SafeGuard Health Plans, Inc. (CA) 3. SafeHealth Life Insurance Company (CA) 4. SafeGuard Health Plans, Inc. (FL) 5. SafeGuard Health Plans, Inc. (NV) 6. SafeGuard Health Plans, Inc. (TX) V. MetLife Capital Trust X (DE) W. Cova Life Management Company (DE) X. MetLife Reinsurance Company of Charleston (SC) Y. MetLife Reinsurance Company of Vermont (VT) Z. Delaware American Life Insurance Company (DE) AA. Federal Flood Certification LLC (TX) AB. American Life Insurance Company (ALICO) (DE) 1. MetLife ALICO Life Insurance K.K. (Japan) a) Nagasaki Operation Yugen Kaisha (Japan) b) Communication One Kabushiki Kaisha (Japan) c) Financial Learning Kabushiki Kaisha (Japan) 2. MetLife Global Holding Company I GmbH (Swiss I) (Switzerland) a) MetLife Global Holding Company II GmbH (Swiss II) (Switzerland) i) MetLife Emeklilik ve Hayat A.S. (Turkey) - 99.9788% of MetLife Emeklilik ve Hayat A.S. is owned by Metlife Global Holding Company II GmbH (Swiss II) and the remainder by third parties. ii) ALICO European Holdings Limited (Ireland) aa) ZAO Maser D (Russia) 1) ZAO ALICO Insurance Company (Russia) - 51% of ZAO ALICO Insurance Company is owned by ZAO Master D and 49% is owned by MetLife Global Holding Company II GmbH. ii) MetLife EU Holding Company Limited (Ireland) aa) MetLife Europe Limited (Ireland) - 93% of MetLife Europe Limited is owned by MetLife EU Holding Company Limited and 7% is owned by ALICO. 1. MetLife Pension Trustees Limited (United Kingdom) bb) Agenvita S.r.l. (Italy) cc) MetLife Europe Insurance Limited (Ireland)- 93% of MetLife Europe Insurance Limited is owned by MetLife EU Holding Company Limited and 7% is owned by ALICO. dd) MetLife Europe Services Limited (Ireland) ee) MetLife Insurance Limited (United Kingdom) ff) MetLife Limited (United Kingdom) gg) MetLife Services, Sociedad Limitada (Spain) hh) MetLife Insurance S.A./NV (Belgium) - 99.999% of MetLife Insurance S.A./NV is owned by MetLife EU Holding Company Limited and 0.001% is owned by Natilportem Holdings, Inc. ii) MetLife Solutions S.A.S. (France) jj) Metlife Biztosito Zrt. (Hungary) 1) First American-Hungarian Insurance Agency Limited (Hungary) kk) Metropolitan Life Asigurari S.A. (Romania) - 99.9982018% of Metropolitan Life Asigurari S.A. is owned by MetLife EU Holding Company Limited and the remaining 0.0017982% is owned by International Technical and Advisory Services Limited. 1) ALICO Societate de Administrare a unui Fond de Pensii Administrat Privat S.A. (Romania) - 99.9748% of ALICO Societate de Administrare a unui Fond de Pensii Administrat Privat S.A. is owned by ALICO Asigurari Romania S.A. and 0.0252% is owned by AMPLICO Services Sp z.o.o. 2) Metropolitan Training and Consulting S.R.L. (Romania) 3) APF Societate de Administrare a Fondurilor De Pensii Facultative (APF) (Romania) - 99.99% of APF is owned by Metropolitan Life Asigurari S.A. and 0.01% is owned by ITAS Limited. ll) MetLife AMSLICO poist'ovna, a.s. (Slovakia) 1) ALICO Services Central Europe s.r.o. (Slovakia) 2) ALICO Funds Central Europe sprav. spol., a.s. (Slovakia) mm) MetLife pojist'ovna a.s. (Czech Republic) nn) AMPLICO Life-First American Polish Life Insurance & Reinsurance Company, S.A. (Poland) a) Amplico Services Sp z.o.o. (Poland) b) AMPLICO Towartzystwo Funduszky Inwestycyjnych, S.A. (Poland) c) AMPLICO Powszechne Towartzystwo Emerytalne S.A. (Poland) - 50% of AMPLICO Powszechne Towarzystwo Emerytalne S.A. is owned by AMPLICO Life-First American Polish Life Insurance & Reinsurance Company, S.A. and the remaining 50% is owned by MetLife EU Holding Company Limited. oo) MetLife Holdings (Cyprus) Limited (Cyprus) a) American Life Insurance Company (Cyprus) Limited (Cyprus) pp) ALICO Bulgaria Zhivotozastrahovatelno Druzhestvo EAD (Bulgaria) qq) MetLife Alico Life Insurance Company S.A. (Greece) a) ALICO Mutual Fund Management Company (Greece) - 90% of ALICO Mutual Fund Management Company is owned by MetLife Alico Life Insurance Company S.A. (Greece) and the remaining interests are owned by third parties. 3. Pharaonic American Life Insurance Company (Egypt) - 84.125% of Pharaonic American Life Insurance Company is owned by ALICO and the remaining interests are owned by third parties. 4. American Life Insurance Company (Pakistan) Ltd. (Pakistan) - 81.96% of American Life Insurance Company (Pakistan) Ltd. is owned by ALICO and the remaining interests are owned by third parties. 5. International Investment Holding Company Limited (Russia) 6. MetLife Akcionarsko Drustvo za Zivotno Osiguranje (Serbia) - 99.98% of MetLife Akcionarska Drustvoza za Zivotno Osiguranje is owned by ALICO and the remaining 0.02% is owned by International Technical and Advisory Services Limited. 7. ALICO Management Services Limited (United Kingdom) 8. ZEUS Administration Services Limited (United Kingdom) 9. ALICO Trustees Ltd. (United Kingdom) - 50% of ALICO Trustees (UK) Ltd. is owned by ALICO and the remaining interest is owned by International Technical and Advisory Services Limited. 10. PJSC ALICO Ukraine (Ukraine) - 99.9988% of PJSC ALICO Ukraine is owned by ALICO 0.0006% is owned by International Technical and Advisory Services Limited and the remaining 0.0006% is owned by Borderland Investment Limited. 11. Borderland Investment Limited (USA-Delaware) a) ALICO Hellas Single Member Limited Liability Company (Greece) 12. International Technical and Advisory Services Limited (ITAS) (USA-Delaware) 13. ALICO Operations Inc. (USA-Delaware) a) MetLife Asset Management Corp. (Japan) 14. MetLife Colombia Seguros de Vida S.A. (Colombia) - 94.9899823% of MetLife Colombia Seguros de Vida S.A. is owned by ALICO, 5.0100106% is owned by International Technical and Advisory Services Limited and the remaining interests are owned by third parties. 15. MetLife Mas, S.A. de C.V. (Mexico) - 99.9997546% of MetLife Mas, SA de CV is owned by ALICO and 0.0002454% is owned by International Technical and Advisory Services Limited. 16. MetLife Seguros S.A. (Uruguay) - 74.9187% of MetLife Seguros S.A. is owned by ALICO, 25.0798% by MetLife, Inc. and 0.0015% by a third party (Oscar Schmidt). 17. ALICO Properties, Inc. (USA-Delaware) - 51% of ALICO Properties, Inc. is owned by ALICO and the remaining interests are owned by third parties. a) Global Properties, Inc. (USA-Delaware) 18. Alpha Properties, Inc. (USA-Delaware) 19. Beta Properties, Inc. (USA-Delaware) 20. Delta Properties Japan, Inc. (USA-Delaware) 21. Epsilon Properties Japan, Inc. (USA-Delaware) 22. Iris Properties, Inc. (USA-Delaware) 23. Kappa Properties Japan, Inc. (USA-Delaware) AC. MetLife Global Benefits, Ltd. (Cayman Islands) AD. Inversiones Metlife Holdco Dos Limitada (Chile) - 99.999338695% of Inversiones MetLife Holdco Dos Limitada is owned by MetLife, Inc., 0.00065469% is owned by MetLife International Holdings, Inc. and 0.000006613% is owned by Natiloportem. AE. MetLife Consumer Services, Inc. (DE) AF. MetLife Reinsurance Company of Delaware (DE) 1) The voting securities (excluding directors' qualifying shares, if any) of each subsidiary shown on the organizational chart are 100% owned by their respective parent corporation, unless otherwise indicated. 2) The Metropolitan Money Market Pool and MetLife Intermediate Income Pool are pass-through investment pools, of which Metropolitan Life Insurance Company and/or its subsidiaries and/or affiliates are general partners. 3) The MetLife, Inc. organizational chart does not include real estate joint ventures and partnerships of which MetLife, Inc. and/or its subsidiaries is an investment partner. In addition, certain inactive subsidiaries have also been omitted. 4) MetLife Services EEIG is a cost-sharing mechanism used in the EU for EU- affiliated members. 6 ITEM 29. INDEMNIFICATION MetLife, Inc. has secured a Financial Institutions Bond in the amount of $50,000,000 subject to a $5,000,000 deductible. MetLife also maintains Directors' and Officers' Liability insurance coverage with limits of $400 million. The Directors and Officers of Metropolitan Life Insurance Company ("Metropolitan"), as well as certain other subsidiaries of MetLife, Inc., are covered under the Financial Institutions Bond as well as under the Directors' and Officers' Liability Policy. A provision in Metropolitan's by-laws provides for the indemnification (under certain circumstances) of individuals serving as directors or officers of Metropolitan. Insofar as indemnification for liability arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of Metropolitan pursuant to the foregoing provisions, or otherwise, Metropolitan Life Insurance Company has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by Metropolitan of expenses incurred or paid by a director, officer or controlling person or Metropolitan Life Insurance Company in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, Metropolitan will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue. ITEM 30. PRINCIPAL UNDERWRITERS (a) MetLife Investors Distribution Company is the principal underwriter and distributor of the Policies. MetLife Investors Distribution Company is the principal underwriter for the following investment companies: Met Investors Series Trust Metropolitan Series Fund First MetLife Investors Variable Annuity Account One General American Separate Account Two General American Separate Account Eleven General American Separate Account Twenty-Eight General American Separate Account Twenty-Nine MetLife of CT Fund UL for Variable Life Insurance MetLife of CT Fund UL III for Variable Life Insurance MetLife of CT Separate Account Eleven for Variable Annuities MetLife of CT Separate Account QPN for Variable Annuities MetLife Investors Variable Annuity Account One MetLife Investors Variable Life Account One MetLife Investors USA Separate Account A MetLife Investors USA Variable Life Account A Metropolitan Life Separate Account E Metropolitan Life Separate Account UL Metropolitan Life Variable Annuity Separate Account II Metropolitan Tower Separate Account One Metropolitan Tower Separate Account Two New England Life Retirement Investment Account New England Variable Annuity Fund I New England Variable Annuity Separate Account New England Variable Life Separate Account Paragon Separate Account A Paragon Separate Account B Paragon Separate Account C Paragon Separate Account D Security Equity Separate Account Twenty-Six Security Equity Separate Account Twenty-Seven Separate Account No. 13S (b) The following persons are the officers and directors of MetLife Investors Distribution Company. The principal business address for MetLife Investors Distribution Company is 1095 Avenue of the Americas, New York, NY 10036.
NAME AND PRINCIPAL BUSINESS OFFICE POSITIONS AND OFFICES WITH UNDERWRITER ---------------------------------- -------------------------------------------------------------------- Elizabeth M. Forget Director and President Metropolitan Life Insurance Company 1095 Avenue of the Americas New York, NY 10036 Paul A. LaPiana Director and Executive Vice President, National Sales Manager- Life Metropolitan Life Insurance Company 11225 North Community House Road Charlotte, NC 28277 Jay S. Kaduson Senior Vice President Metropolitan Life Insurance Company 11225 North Community House Road Charlotte, NC 28277 Andrew G. Aiello Senior Vice President, Channel Head- National Accounts Metropolitan Life Insurance Company 11225 North Community House Road Charlotte, NC 28277 John P. Kyne, III Vice President, Compliance Metropolitan Life Insurance Company 11225 North Community House Road Charlotte, NC 28277 John G. Martinez Vice President and Chief Financial Officer Metropolitan Life Insurance Company 18210 Crane Nest Drive Tampa, FL 33647 Marlene B. Debel Treasurer Metropolitan Life Insurance Company 1095 Avenue of the Americas New York, NY 10036
(c) Compensation from the Registrant. (1) (2) (3) (4) (5) COMPENSATION ON EVENTS OCCASIONING NET UNDERWRITING THE DEDUCTION OF A DISCOUNTS AND DEFERRED SALES BROKERAGE OTHER NAME OF PRINCIPAL UNDERWRITER COMMISSIONS LOAD COMMISSIONS COMPENSATION ----------------------------- ---------------- ------------------ ----------- ------------ MetLife Investors Distribution Company. $1,424,904 $ 0 $ 0 $ 0
ITEM 31. LOCATION OF ACCOUNTS AND RECORDS The following companies will maintain possession of the documents required by Section 31(a) of the Investment Company Act of 1940 and the Rules thereunder: (a) Registrant (b) Metropolitan Life Insurance Company 200 Park Avenue New York, NY 10166 (c) MetLife Investors Distribution Company 1095 Avenue of the Americas New York, NY 10036 ITEM 32. MANAGEMENT SERVICES Not applicable ITEM 33. FEE REPRESENTATION Metropolitan Life represents that the fees and charges deducted under the Policies offered and sold pursuant to this amended Registration Statement, in the aggregate, are reasonable in relation to the services rendered, the expenses to be incurred, and the risks assumed by Metropolitan Life under the Policies. SIGNATURES Pursuant to the requirements of the Securities Act of 1933 and the Investment Company Act of 1940, the Registrant, Metropolitan Life Separate Account UL, certifies that it meets all of the requirements for effectiveness of this amended Registration Statement under Rule 485(b) under the Securities Act and has caused this Amendment to the Registration Statement to be signed on its behalf, in the City of New York, and the State of New York on the 11th day of April, 2014. Metropolitan Life Separate Account UL By: Metropolitan Life Insurance Company By: /s/ Paul G. Cellupica ------------------------------------- Paul G. Cellupica, Esq. Chief Counsel - Americas SIGNATURES Pursuant to the requirements of the Securities Act of 1933 and the Investment Company Act of 1940, Metropolitan Life Insurance Company certifies that it meets all of the requirements for effectiveness of this amended Registration Statement under Rule 485(b) under the Securities Act and has caused this Amendment to the Registration Statement to be signed on its behalf, in the City of New York, and the State of New York on the 11th day of April, 2014. Metropolitan Life Insurance Company By: /s/ Paul G. Cellupica ------------------------------------------- Paul G. Cellupica, Esq. Chief Counsel - Americas Pursuant to the requirements of the Securities Act of 1933, this Amendment to the Registration Statement has been signed by the following persons, in the capacities indicated, on April 11, 2014. SIGNATURE TITLE --------- ----- * Chairman of the Board, President and ------------------------------------- Chief Executive Officer and a Director Steven A. Kandarian * Executive Vice President and ------------------------------------- Chief Accounting Officer Peter M. Carlson * Director ------------------------------------- Cheryl W. Grise * Director ------------------------------------- Carlos Miguel Gutierrez * Director ------------------------------------- R. Glenn Hubbard * Director ------------------------------------- John M. Keane * Director ------------------------------------- Alfred F. Kelly, Jr. * Director ------------------------------------- William E. Kennard * Director ------------------------------------- James M. Kilts * Director ------------------------------------- Catherine R. Kinney * Director ------------------------------------- Denise M. Morrison * Director ------------------------------------- Hugh B. Price * Director ------------------------------------- Kenton J. Sicchitano * Director ------------------------------------- Lulu C. Wang * Executive Vice President and ------------------------------------- Chief Financial Officer John C.R. Hele By: /s/ Marie C. Swift -------------------------- Marie C. Swift, Esq. Attorney-in-fact * Executed by Marie C. Swift, Esq. on behalf of those indicated pursuant to Powers of Attorney filed herewith. Exhibit Index (h)(ix) Amendments to the Participation Agreements with Franklin Templeton Variable Insurance Products Trust, Janus Aspen Series, Legg Mason Partners Variable Equity Trust and Legg Mason Partners Variable Income Trust (n) Consent of Independent Registered Public Accounting Firm (r) Powers of Attorney EX-99.H (IX) 2 d632302dex99hix.txt PARTICIPATION AGREEMENT AMENDMENTS AMENDMENT NO. 5 TO AMENDED AND RESTATED PARTICIPATION AGREEMENT Franklin Templeton Variable Insurance Products Trust Franklin/Templeton Distributors, Inc. Metropolitan Life Insurance Company MetLife Investors Distribution Company Franklin Templeton Variable Insurance Products Trust (the "Trust"), Franklin/Templeton Distributors, Inc. (the "Underwriter," and together with the Trust, "we" or "us"), Metropolitan Life Insurance Company (the "Company" or "you"), and MetLife Investors Distribution Company, your distributor, on your behalf and on behalf of certain Accounts, have previously entered into an Amended and Restated Participation Agreement dated May 1, 2004, and subsequently amended May 1, 2007, November 10, 2008, October 5, 2010 and January 15, 2013, and further modified by an Addendum dated May 1, 2011 (the "Agreement"). The parties now desire to further amend the Agreement by this amendment (the "Amendment"). Except as modified hereby, all other terms and conditions of the Agreement shall remain in full force and effect. Unless otherwise indicated, the terms defined in the Agreement shall have the same meaning in this Amendment. AMENDMENT NOW, THEREFORE, in consideration of past and prospective business relations, the parties agree to amend the Agreement as follows: 1. Schedule B of the Agreement is deleted and replaced in its entirety with the Schedule B attached hereto. 2. All other terms and provisions of the Agreement not amended herein shall remain in full force and effect. IN WITNESS WHEREOF, each of the parties has caused its duly authorized officers to execute this Amendment effective as of December 2, 2013. FRANKLIN TEMPLETON VARIABLE INSURANCE PRODUCTS TRUST The Trust: ONLY ON BEHALF OF EACH PORTFOLIO LISTED ON SCHEDULE C OF THE AGREEMENT. By: /s/ Karen L. Skidmore ---------------------------- Name: Karen L. Skidmore Title: Vice President The Underwriter: FRANKLIN TEMPLETON DISTRIBUTORS, INC. By: /s/ Christopher Felchlin ---------------------------- Name: Christopher Felchlin Title: Vice President The Company: METROPOLITAN LIFE INSURANCE COMPANY By: /s/ Alan C. Leland, Jr. ---------------------------- Name: Alan C. Leland, Jr. Title: Vice President The Distributor: METLIFE INVESTORS DISTRIBUTION COMPANY By: /s/ Paul M. Kos ---------------------------- Name: Paul M. Kos Title: Vice President SCHEDULE B ACCOUNTS OF THE COMPANY
NAME OF ACCOUNT SEC REGISTRATION --------------- ---------------- YES/NO Metropolitan Life Separate Account Yes Metropolitan Life Separate Account DCVL No Metropolitan Life Variable Annuity Separate Account II Yes Metropolitan Life Separate Account E Yes
AMENDMENT NO. 3 TO FUND PARTICIPATION AGREEMENTS JANUS ASPEN SERIES (INSTITUTIONAL & SERVICE SHARES) This Amendment (the "Amendment") to the Agreements (as defined below) is made as of November 25, 2013 between Janus Aspen Series, an open-end management investment company organized as a Delaware statutory trust (the "Trust"), and Metropolitan Life Insurance Company, a life insurance company organized under the laws of the State of New York (the "Company"). BACKGROUND ---------- A. The Trust and the Company are parties to two (2) Fund Participation Agreements dated April 30, 2004, as amended (the "Agreements"). B. The parties wish to update Schedules A and B and further amend and update the Agreements as set forth below. AMENDMENT --------- For good and valuable consideration, the receipt of which is hereby acknowledged, the parties agree to amend the Agreements as follows: 1. Schedule A shall be deleted in its entirety and replaced with Schedule A attached hereto. 2. Schedule B shall be deleted in its entirety and replaced with Schedule B attached hereto. 3. Section 1.11 of the Agreements shall be deleted in its entirety and replaced with the following: "1.11 The Company certifies that it is following all relevant rules and regulations, as well as internal policies and procedures, regarding "forward pricing" and the handling of mutual fund orders on a timely basis. As evidence of its compliance, the Company shall: (a) permit the Trust or its agent to audit its operations, as well as any books and records preserved in connection with its provision of services under this Agreement; or (b) provide the Trust with the results of a Statement on Standards for Attestation Engagements No. 16 (SSAE-16) review or similar report of independent auditors upon request; or 1 (c) provide, upon request, certification to the Trust that it is following all relevant rules, regulations, and internal policies and procedures regarding "forward pricing" and the handling of mutual fund orders on a timely basis." 4. The following shall be added to the end of Section 1.7 of the Agreements: "The Trust shall make the determination as to whether an error in net asset value has occurred and is a material error in accordance with its own internal policies, which are consistent with SEC materiality guidelines." 5. Section 3.9 of the Agreements shall be deleted in its entirety and replaced with the following: "3.9 The Company is, and shall carry out its activities under this Agreement, in compliance with all applicable anti-money laundering laws, rules and regulations including, but not limited to, the U.S.A. PATRIOT Act of 2001, P.L. 107-56. The Company further represents that it has policies and procedures in place to detect money laundering and terrorist financing, including the reporting of suspicious activity." 6. The following shall be added to the end of Article III: "3.10 The Company is a "financial intermediary" as defined by Rule 22c-2 of the 1940 Act (the "Rule"), and has entered into an appropriate agreement with the Trust or one of its affiliates pursuant to the requirements of The Rule. 3.11 The Company represents and warrants that either it or the principal underwriter of any unregistered separate account holding Portfolio shares is a broker or dealer registered under the Securities Exchange Act of 1934 (the "1934 Act") or is controlled (as defined in the 1940 Act) by a broker or dealer registered under the 1934 Act. 3.12 The Company will not hold any other investment security (as defined in Section 3 of the 1940 Act) in a subaccount of an unregistered separate account that holds shares of a Portfolio. 3.13 The Company will seek instructions from holders of interests in an unregistered separate account holding Portfolio shares with regard to the voting of all proxies solicited in connection with a Portfolio and will vote those proxies only in accordance with those instructions, or the Company will -- vote Portfolio shares held in its unregistered separate accounts in the same proportion as the vote all of the Portfolio's other shareholders. 3.14 The Company will not substitute another security for shares of a Portfolio held in an unregistered separate account unless the Securities and Exchange Commission approves the substitution in the manner provided in Section 26 of the 1940 Act." 2 7. Article VII shall be revised as follows: "If to the Trust: Janus Aspen Series 151 Detroit Street Denver, CO 80206 Attn: Chief Legal Counsel If to the Company: Metropolitan Life Insurance Company One Financial Center Boston, MA 02111 Attn: Law Department" 8. The Agreements, as amended by this Amendment, are ratified and confirmed. 9. This Amendment may be executed in two or more counterparts, which together shall constitute one instrument. JANUS ASPEN SERIES METROPOLITAN LIFE INSURANCE COMPANY By: /s/ Stephanie Grauerholz By: /s/ Alan C. Leland, Jr. ------------------------- ------------------------- Name: Stephanie Grauerholz Name: Alan C. Leland, Jr. Title: Vice President Title: Vice President 3 Schedule A ---------- Separate Accounts and Associated Contracts ------------------------------------------
DATE ESTABLISHED BY THE BOARD OF CONTRACTS FUNDED BY SEPARATE NAME OF SEPARATE ACCOUNT DIRECTORS ACCOUNT --------------------------------------- ------------------ ----------------------------------------- Metropolitan Life Separate Account UL 12/31/1988 Variable Life Insurance Policies (MetFlex) Metropolitan Life Separate Account DCVL 11/4/2003 Group Private Placement Variable Life Insurance Policies (PPVL) Individual Private Placement Variable Life Insurance Policies (IPPVL) Separate Account 13S 12/30/1994 Variable Life Insurance Policies (LCL2) Separate Account 36S 4/21/1997 Variable Life Insurance Policies (LCL1) Separate Account 485 4/22/2008 Variable Life Insurance Policies (LCL1) Metropolitan Life Separate Account E 9/27/1983 Gold Track Select
4 Schedule B List of Portfolios ------------------ Name of Portfolio ----------------- All Portfolios of Janus Aspen Series open to new investors (as set forth in the current prospectus of Janus Aspen Series). 5 AMENDMENT NO. 3 TO THE PARTICIPATION AGREEMENT This Amendment No. 3 to the Participation Agreement ("Amendment No. 3") is entered into as of DECEMBER 1, 2013, by and among Metropolitan Life Insurance Company on behalf of itself and certain of its separate accounts, Legg Mason Partners Variable Equity Trust, Legg Mason Partners Variable Income Trust, Legg Mason Investors Services, LLC, and Legg Mason Partners Fund Advisor, LLC. WHEREAS, the parties entered into a Participation Agreement dated January 1, 2009, as amended September 30, 2009 and April 30, 2010 (the "Agreement"); WHEREAS, the parties desire to amend the list of separate accounts set forth in Schedule A to the Agreement. WHEREAS, the parties desire to amend the list of Portfolios set forth in Schedule B to the Agreement. NOW THEREFORE, in consideration of the foregoing and of the mutual covenants and conditions set forth herein and for other good and valuable consideration each of the parties amends the Agreement as follows: 1. Schedule A of the Agreement is hereby deleted in its entirety and replaced with Schedule A attached hereto. 2. Schedule B of the Agreement is hereby deleted in its entirety and replaced with Schedule B attached hereto. Except as expressly supplemented, amended or consented to hereby, all of the representations and conditions of the Agreement will remain unamended and will continue to be in full force and effect. Page 1 of 4 IN WITNESS WHEREOF, each of the parties hereto has caused this Amendment No. 3 to be executed in their name and on their behalf by and through their duly authorized officers signing below as of the date written above. METROPOLITAN LIFE INSURANCE COMPANY (on behalf of the separate accounts and itself) By: /s/ Alan C. Leland, Jr. ------------------------- Name: Alan C. Leland, Jr. Title: Vice President Date: 11/26/13 LEGG MASON PARTNERS VARIABLE EQUITY TRUST By: /s/ Thomas C. Mandia ------------------------- Name: Thomas C. Mandia Title: Assistant Secretary Date: 11/26/13 LEGG MASON PARTNERS VARIABLE INCOME TRUST By: /s/ Thomas C. Mandia ------------------------- Name: Thomas C. Mandia Title: Assistant Secretary Date: 11/26/13 LEGG MASON PARTNERS FUND ADVISOR, LLC By: /s/ Thomas C. Mandia ------------------------- Name: Thomas C. Mandia Title: Secretary Date: 11/26/13 LEGG MASON INVESTOR SERVICES, LLC By: /s/ Michael P. Mattera ------------------------- Name: Michael P. Mattera Title: Director Date: 12/2/13 Page 2 of 4 Schedule A ---------- Separate Accounts and Associated Contracts ------------------------------------------
SEPARATE ACCOUNTS PRODUCTS ------------------------------------------------------ -------------------------------------------------- Metropolitan Life Separate Account DCVL MetLife Group Private Placement Variable Life Insurance Policies Metropolitan Life Separate Account UL MetLife Variable Life Insurance Policies (MetFlex) Metropolitan Life Variable Annuity Separate Account II Flexible Premium Deferred Variable Annuity, Flexible Premium Variable Annuity Metropolitan Life Separate Account E Gold Track Select Annuity
Page 3 of 4 Schedule B ---------- PORTFOLIOS AVAILABLE UNDER THE CONTRACTS ----------------------------------------
TRUST NAME FUND NAME CUSIP/CLASS 12B-1 --------------------- ----------------------- ------------ ----------------------------------- Legg Mason Partners ClearBridge 52467X203 As per the then current prospectus Variable Equity Trust Variable Aggressive Class I (currently 0bps) Growth Portfolio Legg Mason Partners ClearBridge 52467W858 As per the then current prospectus Variable Equity Trust Variable All Cap Class I (currently 0bps). Value Portfolio Legg Mason Partners ClearBridge 52467W882 As per the then current prospectus Variable Equity Trust Variable Appreciation Class I (currently 0bps). Portfolio Legg Mason Partners ClearBridge 52467W833 As per the then current prospectus Variable Equity Trust Variable Equity Income Class I (currently 0bps). Portfolio Legg Mason Partners ClearBridge 52467X609 As per the then current prospectus Variable Equity Trust Variable Large Cap Class I (currently 0bps). Growth Portfolio Legg Mason Partners ClearBridge 52467M504 As per the then current prospectus Variable Equity Trust Variable Large Cap Class I (currently 0bps). Value Portfolio Legg Mason Partners ClearBridge 52467X708 As per the then current prospectus Variable Equity Trust Variable Mid Cap Core Class I (currently 0bps). Portfolio Legg Mason Partners ClearBridge 52467M843 As per the then current prospectus Variable Equity Trust Variable Small Cap Class I (currently 0bps). Growth Portfolio Legg Mason Partners Legg Mason 52467X880 As per the then current prospectus Variable Equity Trust Investment Counsel Single Class (currently 0bps). Variable Social Awareness Portfolio Legg Mason Partners Western Asset 52467K839 As per the then current prospectus Variable Income Trust Variable Global High Class I (currently 0bps) Yield Bond Portfolio Legg Mason Partners Western Asset 52467K771 As per the then current prospectus Variable Income Trust Variable High Income Single Class (currently 0bps). Portfolio Legg Mason Partners Western Asset 52467K813 As per the then current prospectus Variable Income Trust Variable Strategic Bond Class I (currently 0bps). Portfolio
Page 4 of 4 EX-99.N 3 d632302dex99n.txt CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM Exhibit (n) CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM We consent to the use in this Post-Effective Amendment No. 27/Amendment No. 67 to Registration Statement Nos. 033-57320/811-06025 on Form N-6 of our report dated March 27, 2014, relating to the financial statements and financial highlights comprising each of the Investment Divisions of Metropolitan Life Separate Account UL and our report dated March 27, 2014, relating to the consolidated financial statements and financial statement schedules of Metropolitan Life Insurance Company and subsidiaries, both appearing in the Statement of Additional Information, which is part of such Registration Statement, and to the reference to us under the heading "Independent Registered Public Accounting Firm" also in such Statement of Additional Information. /s/ DELOITTE & TOUCHE LLP Tampa, Florida April 11, 2014 EX-99.R 4 d632302dex99r.txt POWERS OF ATTORNEY - METROPOLITAN LIFE INSURANCE COMPANY METROPOLITAN LIFE INSURANCE COMPANY POWER OF ATTORNEY Steven A. Kandarian Chairman of the Board, President and Chief Executive Officer and a Director KNOW ALL MEN BY THESE PRESENTS, that I, Steven A. Kandarian, Chairman of the Board, President and Chief Executive Officer and a Director of Metropolitan Life Insurance Company, a New York company, do hereby constitute and appoint Paul G. Cellupica, Marie C. Swift, Myra L. Saul, John E. Connolly, Jr. and Michele H. Abate, as my attorney-in-fact and agent, each of whom may act individually and none of whom is required to act jointly with any of the others, to sign and file on my behalf and to execute and file any instrument or document required to be filed as part of or in connection with or in any way related to, the Registration Statements and any and all amendments thereto filed by Metropolitan Life Insurance Company under the Securities Act of 1933 and/or the Investment Company Act of 1940, pertaining to: o Metropolitan Life Separate Account E File No. 002-90380 Preference Plus Account (APPA and BPPA), Enhanced Preference Plus Account (EPPA), Financial Freedom Account (FFA), Preference Plus Account for Enhanced Contracts (CPPA) and VestMet; File No. 333-43970 MetLife Income Security Plan; File No. 333-52366 Preference Plus Select; File No. 333-69320 MetLife Asset Builder VA; File No. 333-80547 MetLife Settlement Plus; File No. 333-83716 MetLife Financial Freedom Select B, L and C Class and MetLife Financial Freedom Select e and e Bonus Class; File No. 333-122883 Preference Plus Income Advantage; File No. 333-122897 MetLife Personal IncomePlus; File No. 333-153109 Preference Premier Variable Annuity; File No. 333-160722 Zenith Accumulator; File No. 333-162586 MetLife Growth and Guaranteed Income Variable Annuity; File No. 333-176654 Preference Premier Variable Annuity; File No. 333-190296 Gold Track Select; and Variable Annuity File No. 333- ) ---------- o Metropolitan Life Separate Account UL File No. 033-32813 MetLife UL II; File No. 033-47927 Equity Advantage VUL and UL II; File No. 033-57320 MetFlex; File No. 033-91226 Group VUL; File No. 333-40161 Equity Additions and Equity Enricher; File No. 333-131664 Advantage Equity Options; File No. 333-147508 Equity Advantage VUL; and Variable Life File No. 333- ) ---------- o Metropolitan Life Variable Annuity Separate Account II File No. 333-138113 Flexible Premium Variable Annuity; File No. 333-138115 Flexible Premium Deferred Variable Annuity; File No. 333-161093 Flexible Premium Variable Annuity (B); File No. 333-161094 Flexible Premium Deferred Variable Annuity (B) o New England Life Retirement Investment Account File No. 333-11133 Preference o New England Variable Annuity Fund I File No. 333-11137 o Paragon Separate Account A File No. 333-133674 AFIS; File No. 333-133699 Group American Plus o Paragon Separate Account B File No. 333-133671 DWS C, Met Flex GVUL C and Multi Manager C, Morgan Stanley product, Putnam product, MFS product and Multi Manager III; File No. 333-133675 DWS D, Met Flex GVUL D and Multi Manager D, and Multi Manager II o Paragon Separate Account C File No. 333-133673 Fidelity C; File No. 333-133678 Fidelity D o Paragon Separate Account D File No. 333-133672 Individual Variable Life; File No. 333-133698 Joint Survivor VUL o Security Equity Separate Account 26 File No. 333-110183 Variable Annuity o Security Equity Separate Account 27 File No. 333-110184 Variable Annuity o Separate Account No. 13 S File No. 333-110185 LCL2 Flexible Premium Variable Life and to have full power and authority to do or cause to be done in my name, place and stead each and every act and thing necessary or appropriate in order to effectuate the same, as fully to all intents and purposes as I might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact or any of them, may do or cause to be done by virtue hereof. This Power of Attorney does not revoke any prior powers of attorney. IN WITNESS WHEREOF, I have hereunto set my hand this 9th day of September, 2013. /s/ Steven A. Kandarian ----------------------------- Steven A. Kandarian METROPOLITAN LIFE INSURANCE COMPANY POWER OF ATTORNEY Cheryl W. Grise Director KNOW ALL MEN BY THESE PRESENTS, that I, Cheryl W. Grise, a Director of Metropolitan Life Insurance Company, a New York company, do hereby constitute and appoint Paul G. Cellupica, Marie C. Swift, Myra L. Saul, John E. Connolly, Jr. and Michele H. Abate, as my attorney-in-fact and agent, each of whom may act individually and none of whom is required to act jointly with any of the others, to sign and file on my behalf and to execute and file any instrument or document required to be filed as part of or in connection with or in any way related to, the Registration Statements and any and all amendments thereto filed by Metropolitan Life Insurance Company under the Securities Act of 1933 and/or the Investment Company Act of 1940, pertaining to: o Metropolitan Life Separate Account E File No. 002-90380 Preference Plus Account (APPA and BPPA), Enhanced Preference Plus Account (EPPA), Financial Freedom Account (FFA), Preference Plus Account for Enhanced Contracts (CPPA) and VestMet; File No. 333-43970 MetLife Income Security Plan; File No. 333-52366 Preference Plus Select; File No. 333-69320 MetLife Asset Builder VA; File No. 333-80547 MetLife Settlement Plus; File No. 333-83716 MetLife Financial Freedom Select B, L and C Class and MetLife Financial Freedom Select e and e Bonus Class; File No. 333-122883 Preference Plus Income Advantage; File No. 333-122897 MetLife Personal IncomePlus; File No. 333-153109 Preference Premier Variable Annuity; File No. 333-160722 Zenith Accumulator; File No. 333-162586 MetLife Growth and Guaranteed Income Variable Annuity; File No. 333-176654 Preference Premier Variable Annuity; File No. 333-190296 Gold Track Select; and Variable Annuity File No. 333- ) ---------- o Metropolitan Life Separate Account UL File No. 033-32813 MetLife UL II; File No. 033-47927 Equity Advantage VUL and UL II; File No. 033-57320 MetFlex; File No. 033-91226 Group VUL; File No. 333-40161 Equity Additions and Equity Enricher; File No. 333-131664 Advantage Equity Options; File No. 333-147508 Equity Advantage VUL; and Variable Life File No. 333- ) ---------- o Metropolitan Life Variable Annuity Separate Account II File No. 333-138113 Flexible Premium Variable Annuity; File No. 333-138115 Flexible Premium Deferred Variable Annuity; File No. 333-161093 Flexible Premium Variable Annuity (B); File No. 333-161094 Flexible Premium Deferred Variable Annuity (B) o New England Life Retirement Investment Account File No. 333-11133 Preference o New England Variable Annuity Fund I File No. 333-11137 o Paragon Separate Account A File No. 333-133674 AFIS; File No. 333-133699 Group American Plus o Paragon Separate Account B File No. 333-133671 DWS C, Met Flex GVUL C and Multi Manager C, Morgan Stanley product, Putnam product, MFS product and Multi Manager III; File No. 333-133675 DWS D, Met Flex GVUL D and Multi Manager D, and Multi Manager II o Paragon Separate Account C File No. 333-133673 Fidelity C; File No. 333-133678 Fidelity D o Paragon Separate Account D File No. 333-133672 Individual Variable Life; File No. 333-133698 Joint Survivor VUL o Security Equity Separate Account 26 File No. 333-110183 Variable Annuity o Security Equity Separate Account 27 File No. 333-110184 Variable Annuity o Separate Account No. 13 S File No. 333-110185 LCL2 Flexible Premium Variable Life and to have full power and authority to do or cause to be done in my name, place and stead each and every act and thing necessary or appropriate in order to effectuate the same, as fully to all intents and purposes as I might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact or any of them, may do or cause to be done by virtue hereof. This Power of Attorney does not revoke any prior powers of attorney. IN WITNESS WHEREOF, I have hereunto set my hand this 17th day of September, 2013. /s/ Cheryl W. Grise ----------------------------- Cheryl W. Grise METROPOLITAN LIFE INSURANCE COMPANY POWER OF ATTORNEY Carlos Miguel Gutierrez Director KNOW ALL MEN BY THESE PRESENTS, that I, Carlos Miguel Gutierrez, a Director of Metropolitan Life Insurance Company, a New York company, do hereby constitute and appoint Paul G. Cellupica, Marie C. Swift, Myra L. Saul, John E. Connolly, Jr. and Michele H. Abate, as my attorney-in-fact and agent, each of whom may act individually and none of whom is required to act jointly with any of the others, to sign and file on my behalf and to execute and file any instrument or document required to be filed as part of or in connection with or in any way related to, the Registration Statements and any and all amendments thereto filed by Metropolitan Life Insurance Company under the Securities Act of 1933 and/or the Investment Company Act of 1940, pertaining to: o Metropolitan Life Separate Account E File No. 002-90380 Preference Plus Account (APPA and BPPA), Enhanced Preference Plus Account (EPPA), Financial Freedom Account (FFA), Preference Plus Account for Enhanced Contracts (CPPA) and VestMet; File No. 333-43970 MetLife Income Security Plan; File No. 333-52366 Preference Plus Select; File No. 333-69320 MetLife Asset Builder VA; File No. 333-80547 MetLife Settlement Plus; File No. 333-83716 MetLife Financial Freedom Select B, L and C Class and MetLife Financial Freedom Select e and e Bonus Class; File No. 333-122883 Preference Plus Income Advantage; File No. 333-122897 MetLife Personal IncomePlus; File No. 333-153109 Preference Premier Variable Annuity; File No. 333-160722 Zenith Accumulator; File No. 333-162586 MetLife Growth and Guaranteed Income Variable Annuity; File No. 333-176654 Preference Premier Variable Annuity; File No. 333-190296 Gold Track Select; and Variable Annuity File No. 333- ) ---------- o Metropolitan Life Separate Account UL File No. 033-32813 MetLife UL II; File No. 033-47927 Equity Advantage VUL and UL II; File No. 033-57320 MetFlex; File No. 033-91226 Group VUL; File No. 333-40161 Equity Additions and Equity Enricher; File No. 333-131664 Advantage Equity Options; File No. 333-147508 Equity Advantage VUL; and Variable Life File No. 333- ) ---------- o Metropolitan Life Variable Annuity Separate Account II File No. 333-138113 Flexible Premium Variable Annuity; File No. 333-138115 Flexible Premium Deferred Variable Annuity; File No. 333-161093 Flexible Premium Variable Annuity (B); File No. 333-161094 Flexible Premium Deferred Variable Annuity (B) o New England Life Retirement Investment Account File No. 333-11133 Preference o New England Variable Annuity Fund I File No. 333-11137 o Paragon Separate Account A File No. 333-133674 AFIS; File No. 333-133699 Group American Plus o Paragon Separate Account B File No. 333-133671 DWS C, Met Flex GVUL C and Multi Manager C, Morgan Stanley product, Putnam product, MFS product and Multi Manager III; File No. 333-133675 DWS D, Met Flex GVUL D and Multi Manager D, and Multi Manager II o Paragon Separate Account C File No. 333-133673 Fidelity C; File No. 333-133678 Fidelity D o Paragon Separate Account D File No. 333-133672 Individual Variable Life; File No. 333-133698 Joint Survivor VUL o Security Equity Separate Account 26 File No. 333-110183 Variable Annuity o Security Equity Separate Account 27 File No. 333-110184 Variable Annuity o Separate Account No. 13 S File No. 333-110185 LCL2 Flexible Premium Variable Life and to have full power and authority to do or cause to be done in my name, place and stead each and every act and thing necessary or appropriate in order to effectuate the same, as fully to all intents and purposes as I might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact or any of them, may do or cause to be done by virtue hereof. This Power of Attorney does not revoke any prior powers of attorney. IN WITNESS WHEREOF, I have hereunto set my hand this 17th day of September, 2013. /s/ Carlos Miguel Gutierrez ----------------------------- Carlos Miguel Gutierrez METROPOLITAN LIFE INSURANCE COMPANY POWER OF ATTORNEY R. Glenn Hubbard Director KNOW ALL MEN BY THESE PRESENTS, that I, R. Glenn Hubbard, a Director of Metropolitan Life Insurance Company, a New York company, do hereby constitute and appoint Paul G. Cellupica, Marie C. Swift, Myra L. Saul, John E. Connolly, Jr. and Michele H. Abate, as my attorney-in-fact and agent, each of whom may act individually and none of whom is required to act jointly with any of the others, to sign and file on my behalf and to execute and file any instrument or document required to be filed as part of or in connection with or in any way related to, the Registration Statements and any and all amendments thereto filed by Metropolitan Life Insurance Company under the Securities Act of 1933 and/or the Investment Company Act of 1940, pertaining to: o Metropolitan Life Separate Account E File No. 002-90380 Preference Plus Account (APPA and BPPA), Enhanced Preference Plus Account (EPPA), Financial Freedom Account (FFA), Preference Plus Account for Enhanced Contracts (CPPA) and VestMet; File No. 333-43970 MetLife Income Security Plan; File No. 333-52366 Preference Plus Select; File No. 333-69320 MetLife Asset Builder VA; File No. 333-80547 MetLife Settlement Plus; File No. 333-83716 MetLife Financial Freedom Select B, L and C Class and MetLife Financial Freedom Select e and e Bonus Class; File No. 333-122883 Preference Plus Income Advantage; File No. 333-122897 MetLife Personal IncomePlus; File No. 333-153109 Preference Premier Variable Annuity; File No. 333-160722 Zenith Accumulator; File No. 333-162586 MetLife Growth and Guaranteed Income Variable Annuity; File No. 333-176654 Preference Premier Variable Annuity; File No. 333-190296 Gold Track Select; and Variable Annuity File No. 333- ) ---------- o Metropolitan Life Separate Account UL File No. 033-32813 MetLife UL II; File No. 033-47927 Equity Advantage VUL and UL II; File No. 033-57320 MetFlex; File No. 033-91226 Group VUL; File No. 333-40161 Equity Additions and Equity Enricher; File No. 333-131664 Advantage Equity Options; File No. 333-147508 Equity Advantage VUL; and Variable Life File No. 333- ) ---------- o Metropolitan Life Variable Annuity Separate Account II File No. 333-138113 Flexible Premium Variable Annuity; File No. 333-138115 Flexible Premium Deferred Variable Annuity; File No. 333-161093 Flexible Premium Variable Annuity (B); File No. 333-161094 Flexible Premium Deferred Variable Annuity (B) o New England Life Retirement Investment Account File No. 333-11133 Preference o New England Variable Annuity Fund I File No. 333-11137 o Paragon Separate Account A File No. 333-133674 AFIS; File No. 333-133699 Group American Plus o Paragon Separate Account B File No. 333-133671 DWS C, Met Flex GVUL C and Multi Manager C, Morgan Stanley product, Putnam product, MFS product and Multi Manager III; File No. 333-133675 DWS D, Met Flex GVUL D and Multi Manager D, and Multi Manager II o Paragon Separate Account C File No. 333-133673 Fidelity C; File No. 333-133678 Fidelity D o Paragon Separate Account D File No. 333-133672 Individual Variable Life; File No. 333-133698 Joint Survivor VUL o Security Equity Separate Account 26 File No. 333-110183 Variable Annuity o Security Equity Separate Account 27 File No. 333-110184 Variable Annuity o Separate Account No. 13 S File No. 333-110185 LCL2 Flexible Premium Variable Life and to have full power and authority to do or cause to be done in my name, place and stead each and every act and thing necessary or appropriate in order to effectuate the same, as fully to all intents and purposes as I might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact or any of them, may do or cause to be done by virtue hereof. This Power of Attorney does not revoke any prior powers of attorney. IN WITNESS WHEREOF, I have hereunto set my hand this 17th day of September, 2013. /s/ R. Glenn Hubbard ----------------------------- R. Glenn Hubbard METROPOLITAN LIFE INSURANCE COMPANY POWER OF ATTORNEY John M. Keane Director KNOW ALL MEN BY THESE PRESENTS, that I, John M. Keane, a Director of Metropolitan Life Insurance Company, a New York company, do hereby constitute and appoint Paul G. Cellupica, Marie C. Swift, Myra L. Saul, John E. Connolly, Jr. and Michele H. Abate, as my attorney-in-fact and agent, each of whom may act individually and none of whom is required to act jointly with any of the others, to sign and file on my behalf and to execute and file any instrument or document required to be filed as part of or in connection with or in any way related to, the Registration Statements and any and all amendments thereto filed by Metropolitan Life Insurance Company under the Securities Act of 1933 and/or the Investment Company Act of 1940, pertaining to: o Metropolitan Life Separate Account E File No. 002-90380 Preference Plus Account (APPA and BPPA), Enhanced Preference Plus Account (EPPA), Financial Freedom Account (FFA), Preference Plus Account for Enhanced Contracts (CPPA) and VestMet; File No. 333-43970 MetLife Income Security Plan; File No. 333-52366 Preference Plus Select; File No. 333-69320 MetLife Asset Builder VA; File No. 333-80547 MetLife Settlement Plus; File No. 333-83716 MetLife Financial Freedom Select B, L and C Class and MetLife Financial Freedom Select e and e Bonus Class; File No. 333-122883 Preference Plus Income Advantage; File No. 333-122897 MetLife Personal IncomePlus; File No. 333-153109 Preference Premier Variable Annuity; File No. 333-160722 Zenith Accumulator; File No. 333-162586 MetLife Growth and Guaranteed Income Variable Annuity; File No. 333-176654 Preference Premier Variable Annuity; File No. 333-190296 Gold Track Select; and Variable Annuity File No. 333- ) ---------- o Metropolitan Life Separate Account UL File No. 033-32813 MetLife UL II; File No. 033-47927 Equity Advantage VUL and UL II; File No. 033-57320 MetFlex; File No. 033-91226 Group VUL; File No. 333-40161 Equity Additions and Equity Enricher; File No. 333-131664 Advantage Equity Options; File No. 333-147508 Equity Advantage VUL; and Variable Life File No. 333- ) ---------- o Metropolitan Life Variable Annuity Separate Account II File No. 333-138113 Flexible Premium Variable Annuity; File No. 333-138115 Flexible Premium Deferred Variable Annuity; File No. 333-161093 Flexible Premium Variable Annuity (B); File No. 333-161094 Flexible Premium Deferred Variable Annuity (B) o New England Life Retirement Investment Account File No. 333-11133 Preference o New England Variable Annuity Fund I File No. 333-11137 o Paragon Separate Account A File No. 333-133674 AFIS; File No. 333-133699 Group American Plus o Paragon Separate Account B File No. 333-133671 DWS C, Met Flex GVUL C and Multi Manager C, Morgan Stanley product, Putnam product, MFS product and Multi Manager III; File No. 333-133675 DWS D, Met Flex GVUL D and Multi Manager D, and Multi Manager II o Paragon Separate Account C File No. 333-133673 Fidelity C; File No. 333-133678 Fidelity D o Paragon Separate Account D File No. 333-133672 Individual Variable Life; File No. 333-133698 Joint Survivor VUL o Security Equity Separate Account 26 File No. 333-110183 Variable Annuity o Security Equity Separate Account 27 File No. 333-110184 Variable Annuity o Separate Account No. 13 S File No. 333-110185 LCL2 Flexible Premium Variable Life and to have full power and authority to do or cause to be done in my name, place and stead each and every act and thing necessary or appropriate in order to effectuate the same, as fully to all intents and purposes as I might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact or any of them, may do or cause to be done by virtue hereof. This Power of Attorney does not revoke any prior powers of attorney. IN WITNESS WHEREOF, I have hereunto set my hand this 17th day of September, 2013. /s/ John M. Keane ----------------------------- John M. Keane METROPOLITAN LIFE INSURANCE COMPANY POWER OF ATTORNEY Alfred F. Kelly, Jr. Director KNOW ALL MEN BY THESE PRESENTS, that I, Alfred F. Kelly, Jr., a Director of Metropolitan Life Insurance Company, a New York company, do hereby constitute and appoint Paul G. Cellupica, Marie C. Swift, Myra L. Saul, John E. Connolly, Jr. and Michele H. Abate, as my attorney-in-fact and agent, each of whom may act individually and none of whom is required to act jointly with any of the others, to sign and file on my behalf and to execute and file any instrument or document required to be filed as part of or in connection with or in any way related to, the Registration Statements and any and all amendments thereto filed by Metropolitan Life Insurance Company under the Securities Act of 1933 and/or the Investment Company Act of 1940, pertaining to: o Metropolitan Life Separate Account E File No. 002-90380 Preference Plus Account (APPA and BPPA), Enhanced Preference Plus Account (EPPA), Financial Freedom Account (FFA), Preference Plus Account for Enhanced Contracts (CPPA) and VestMet; File No. 333-43970 MetLife Income Security Plan; File No. 333-52366 Preference Plus Select; File No. 333-69320 MetLife Asset Builder VA; File No. 333-80547 MetLife Settlement Plus; File No. 333-83716 MetLife Financial Freedom Select B, L and C Class and MetLife Financial Freedom Select e and e Bonus Class; File No. 333-122883 Preference Plus Income Advantage; File No. 333-122897 MetLife Personal IncomePlus; File No. 333-153109 Preference Premier Variable Annuity; File No. 333-160722 Zenith Accumulator; File No. 333-162586 MetLife Growth and Guaranteed Income Variable Annuity; File No. 333-176654 Preference Premier Variable Annuity; File No. 333-190296 Gold Track Select; and Variable Annuity File No. 333- ) ---------- o Metropolitan Life Separate Account UL File No. 033-32813 MetLife UL II; File No. 033-47927 Equity Advantage VUL and UL II; File No. 033-57320 MetFlex; File No. 033-91226 Group VUL; File No. 333-40161 Equity Additions and Equity Enricher; File No. 333-131664 Advantage Equity Options; File No. 333-147508 Equity Advantage VUL; and Variable Life File No. 333- ) ---------- o Metropolitan Life Variable Annuity Separate Account II File No. 333-138113 Flexible Premium Variable Annuity; File No. 333-138115 Flexible Premium Deferred Variable Annuity; File No. 333-161093 Flexible Premium Variable Annuity (B); File No. 333-161094 Flexible Premium Deferred Variable Annuity (B) o New England Life Retirement Investment Account File No. 333-11133 Preference o New England Variable Annuity Fund I File No. 333-11137 o Paragon Separate Account A File No. 333-133674 AFIS; File No. 333-133699 Group American Plus o Paragon Separate Account B File No. 333-133671 DWS C, Met Flex GVUL C and Multi Manager C, Morgan Stanley product, Putnam product, MFS product and Multi Manager III; File No. 333-133675 DWS D, Met Flex GVUL D and Multi Manager D, and Multi Manager II o Paragon Separate Account C File No. 333-133673 Fidelity C; File No. 333-133678 Fidelity D o Paragon Separate Account D File No. 333-133672 Individual Variable Life; File No. 333-133698 Joint Survivor VUL o Security Equity Separate Account 26 File No. 333-110183 Variable Annuity o Security Equity Separate Account 27 File No. 333-110184 Variable Annuity o Separate Account No. 13 S File No. 333-110185 LCL2 Flexible Premium Variable Life and to have full power and authority to do or cause to be done in my name, place and stead each and every act and thing necessary or appropriate in order to effectuate the same, as fully to all intents and purposes as I might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact or any of them, may do or cause to be done by virtue hereof. This Power of Attorney does not revoke any prior powers of attorney. IN WITNESS WHEREOF, I have hereunto set my hand this 17th day of September, 2013. /s/ Alfred F. Kelly, Jr. ----------------------------- Alfred F. Kelly, Jr. METROPOLITAN LIFE INSURANCE COMPANY POWER OF ATTORNEY William E. Kennard Director KNOW ALL MEN BY THESE PRESENTS, that I, William E. Kennard, a Director of Metropolitan Life Insurance Company, a New York company, do hereby constitute and appoint Paul G. Cellupica, Marie C. Swift, Myra L. Saul, John E. Connolly, Jr. and Michele H. Abate, as my attorney-in-fact and agent, each of whom may act individually and none of whom is required to act jointly with any of the others, to sign and file on my behalf and to execute and file any instrument or document required to be filed as part of or in connection with or in any way related to, the Registration Statements and any and all amendments thereto filed by Metropolitan Life Insurance Company under the Securities Act of 1933 and/or the Investment Company Act of 1940, pertaining to: o Metropolitan Life Separate Account E File No. 002-90380 Preference Plus Account (APPA and BPPA), Enhanced Preference Plus Account (EPPA), Financial Freedom Account (FFA), Preference Plus Account for Enhanced Contracts (CPPA) and VestMet; File No. 333-43970 MetLife Income Security Plan; File No. 333-52366 Preference Plus Select; File No. 333-69320 MetLife Asset Builder VA; File No. 333-80547 MetLife Settlement Plus; File No. 333-83716 MetLife Financial Freedom Select B, L and C Class and MetLife Financial Freedom Select e and e Bonus Class; File No. 333-122883 Preference Plus Income Advantage; File No. 333-122897 MetLife Personal IncomePlus; File No. 333-153109 Preference Premier Variable Annuity; File No. 333-160722 Zenith Accumulator; File No. 333-162586 MetLife Growth and Guaranteed Income Variable Annuity; File No. 333- 176654 Preference Premier Variable Annuity; File No. 333-190296 Gold Track Select; and Variable Annuity File No. 333- ) ---------- o Metropolitan Life Separate Account UL File No. 033-32813 MetLife UL II; File No. 033-47927 Equity Advantage VUL and UL II; File No. 033-57320 MetFlex; File No. 033-91226 Group VUL; File No. 333-40161 Equity Additions and Equity Enricher; File No. 333-131664 Advantage Equity Options; File No. 333-147508 Equity Advantage VUL; and Variable Life File No. 333- ) ---------- o Metropolitan Life Variable Annuity Separate Account II File No. 333-138113 Flexible Premium Variable Annuity; File No. 333-138115 Flexible Premium Deferred Variable Annuity; File No. 333-161093 Flexible Premium Variable Annuity (B); File No. 333-161094 Flexible Premium Deferred Variable Annuity (B) o New England Life Retirement Investment Account File No. 333-11133 Preference o New England Variable Annuity Fund I File No. 333-11137 o Paragon Separate Account A File No. 333-133674 AFIS; File No. 333-133699 Group American Plus o Paragon Separate Account B File No. 333-133671 DWS C, Met Flex GVUL C and Multi Manager C, Morgan Stanley product, Putnam product, MFS product and Multi Manager III; File No. 333-133675 DWS D, Met Flex GVUL D and Multi Manager D, and Multi Manager II o Paragon Separate Account C File No. 333-133673 Fidelity C; File No. 333-133678 Fidelity D o Paragon Separate Account D File No. 333-133672 Individual Variable Life; File No. 333-133698 Joint Survivor VUL o Security Equity Separate Account 26 File No. 333-110183 Variable Annuity o Security Equity Separate Account 27 File No. 333-110184 Variable Annuity o Separate Account No. 13 S File No. 333-110185 LCL2 Flexible Premium Variable Life and to have full power and authority to do or cause to be done in my name, place and stead each and every act and thing necessary or appropriate in order to effectuate the same, as fully to all intents and purposes as I might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact or any of them, may do or cause to be done by virtue hereof. This Power of Attorney does not revoke any prior powers of attorney. IN WITNESS WHEREOF, I have hereunto set my hand this 17th day of September, 2013. /s/ William E. Kennard ----------------------------- William E. Kennard METROPOLITAN LIFE INSURANCE COMPANY POWER OF ATTORNEY James M. Kilts Director KNOW ALL MEN BY THESE PRESENTS, that I, James M. Kilts, a Director of Metropolitan Life Insurance Company, a New York company, do hereby constitute and appoint Paul G. Cellupica, Marie C. Swift, Myra L. Saul, John E. Connolly, Jr. and Michele H. Abate, as my attorney-in-fact and agent, each of whom may act individually and none of whom is required to act jointly with any of the others, to sign and file on my behalf and to execute and file any instrument or document required to be filed as part of or in connection with or in any way related to, the Registration Statements and any and all amendments thereto filed by Metropolitan Life Insurance Company under the Securities Act of 1933 and/or the Investment Company Act of 1940, pertaining to: o Metropolitan Life Separate Account E File No. 002-90380 Preference Plus Account (APPA and BPPA), Enhanced Preference Plus Account (EPPA), Financial Freedom Account (FFA), Preference Plus Account for Enhanced Contracts (CPPA) and VestMet; File No. 333-43970 MetLife Income Security Plan; File No. 333-52366 Preference Plus Select; File No. 333-69320 MetLife Asset Builder VA; File No. 333-80547 MetLife Settlement Plus; File No. 333-83716 MetLife Financial Freedom Select B, L and C Class and MetLife Financial Freedom Select e and e Bonus Class; File No. 333-122883 Preference Plus Income Advantage; File No. 333-122897 MetLife Personal IncomePlus; File No. 333-153109 Preference Premier Variable Annuity; File No. 333-160722 Zenith Accumulator; File No. 333-162586 MetLife Growth and Guaranteed Income Variable Annuity; File No. 333-176654 Preference Premier Variable Annuity; File No. 333-190296 Gold Track Select; and Variable Annuity File No. 333- ) ---------- o Metropolitan Life Separate Account UL File No. 033-32813 MetLife UL II; File No. 033-47927 Equity Advantage VUL and UL II; File No. 033-57320 MetFlex; File No. 033-91226 Group VUL; File No. 333-40161 Equity Additions and Equity Enricher; File No. 333-131664 Advantage Equity Options; File No. 333-147508 Equity Advantage VUL; and Variable Life File No. 333- ) ---------- o Metropolitan Life Variable Annuity Separate Account II File No. 333-138113 Flexible Premium Variable Annuity; File No. 333-138115 Flexible Premium Deferred Variable Annuity; File No. 333-161093 Flexible Premium Variable Annuity (B); File No. 333-161094 Flexible Premium Deferred Variable Annuity (B) o New England Life Retirement Investment Account File No. 333-11133 Preference o New England Variable Annuity Fund I File No. 333-11137 o Paragon Separate Account A File No. 333-133674 AFIS; File No. 333-133699 Group American Plus o Paragon Separate Account B File No. 333-133671 DWS C, Met Flex GVUL C and Multi Manager C, Morgan Stanley product, Putnam product, MFS product and Multi Manager III; File No. 333-133675 DWS D, Met Flex GVUL D and Multi Manager D, and Multi Manager II o Paragon Separate Account C File No. 333-133673 Fidelity C; File No. 333-133678 Fidelity D o Paragon Separate Account D File No. 333-133672 Individual Variable Life; File No. 333-133698 Joint Survivor VUL o Security Equity Separate Account 26 File No. 333-110183 Variable Annuity o Security Equity Separate Account 27 File No. 333-110184 Variable Annuity o Separate Account No. 13 S File No. 333-110185 LCL2 Flexible Premium Variable Life and to have full power and authority to do or cause to be done in my name, place and stead each and every act and thing necessary or appropriate in order to effectuate the same, as fully to all intents and purposes as I might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact or any of them, may do or cause to be done by virtue hereof. This Power of Attorney does not revoke any prior powers of attorney. IN WITNESS WHEREOF, I have hereunto set my hand this 17th day of September, 2013. /s/ James M. Kilts ----------------------------- James M. Kilts METROPOLITAN LIFE INSURANCE COMPANY POWER OF ATTORNEY Catherine R. Kinney Director KNOW ALL MEN BY THESE PRESENTS, that I, Catherine R. Kinney, a Director of Metropolitan Life Insurance Company, a New York company, do hereby constitute and appoint Paul G. Cellupica, Marie C. Swift, Myra L. Saul, John E. Connolly, Jr. and Michele H. Abate, as my attorney-in-fact and agent, each of whom may act individually and none of whom is required to act jointly with any of the others, to sign and file on my behalf and to execute and file any instrument or document required to be filed as part of or in connection with or in any way related to, the Registration Statements and any and all amendments thereto filed by Metropolitan Life Insurance Company under the Securities Act of 1933 and/or the Investment Company Act of 1940, pertaining to: o Metropolitan Life Separate Account E File No. 002-90380 Preference Plus Account (APPA and BPPA), Enhanced Preference Plus Account (EPPA), Financial Freedom Account (FFA), Preference Plus Account for Enhanced Contracts (CPPA) and VestMet; File No. 333-43970 MetLife Income Security Plan; File No. 333-52366 Preference Plus Select; File No. 333-69320 MetLife Asset Builder VA; File No. 333-80547 MetLife Settlement Plus; File No. 333-83716 MetLife Financial Freedom Select B, L and C Class and MetLife Financial Freedom Select e and e Bonus Class; File No. 333-122883 Preference Plus Income Advantage; File No. 333-122897 MetLife Personal IncomePlus; File No. 333-153109 Preference Premier Variable Annuity; File No. 333-160722 Zenith Accumulator; File No. 333-162586 MetLife Growth and Guaranteed Income Variable Annuity; File No. 333-176654 Preference Premier Variable Annuity; File No. 333-190296 Gold Track Select; and Variable Annuity File No. 333- ) ---------- o Metropolitan Life Separate Account UL File No. 033-32813 MetLife UL II; File No. 033-47927 Equity Advantage VUL and UL II; File No. 033-57320 MetFlex; File No. 033-91226 Group VUL; File No. 333-40161 Equity Additions and Equity Enricher; File No. 333-131664 Advantage Equity Options; File No. 333-147508 Equity Advantage VUL; and Variable Life File No. 333- ) ---------- o Metropolitan Life Variable Annuity Separate Account II File No. 333-138113 Flexible Premium Variable Annuity; File No. 333-138115 Flexible Premium Deferred Variable Annuity; File No. 333-161093 Flexible Premium Variable Annuity (B); File No. 333-161094 Flexible Premium Deferred Variable Annuity (B) o New England Life Retirement Investment Account File No. 333-11133 Preference o New England Variable Annuity Fund I File No. 333-11137 o Paragon Separate Account A File No. 333-133674 AFIS; File No. 333-133699 Group American Plus o Paragon Separate Account B File No. 333-133671 DWS C, Met Flex GVUL C and Multi Manager C, Morgan Stanley product, Putnam product, MFS product and Multi Manager III; File No. 333-133675 DWS D, Met Flex GVUL D and Multi Manager D, and Multi Manager II o Paragon Separate Account C File No. 333-133673 Fidelity C; File No. 333-133678 Fidelity D o Paragon Separate Account D File No. 333-133672 Individual Variable Life; File No. 333-133698 Joint Survivor VUL o Security Equity Separate Account 26 File No. 333-110183 Variable Annuity o Security Equity Separate Account 27 File No. 333-110184 Variable Annuity o Separate Account No. 13 S File No. 333-110185 LCL2 Flexible Premium Variable Life and to have full power and authority to do or cause to be done in my name, place and stead each and every act and thing necessary or appropriate in order to effectuate the same, as fully to all intents and purposes as I might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact or any of them, may do or cause to be done by virtue hereof. This Power of Attorney does not revoke any prior powers of attorney. IN WITNESS WHEREOF, I have hereunto set my hand this 17th day of September, 2013. /s/ Catherine R. Kinney ----------------------------- Catherine R. Kinney METROPOLITAN LIFE INSURANCE COMPANY POWER OF ATTORNEY Denise M. Morrison Director KNOW ALL MEN BY THESE PRESENTS, that I, Denise M. Morrison, a Director of Metropolitan Life Insurance Company, a New York company, do hereby constitute and appoint Paul G. Cellupica, Marie C. Swift, Myra L. Saul, John E. Connolly, Jr. and Michele H. Abate, as my attorney-in-fact and agent, each of whom may act individually and none of whom is required to act jointly with any of the others, to sign and file on my behalf and to execute and file any instrument or document required to be filed as part of or in connection with or in any way related to, the Registration Statements and any and all amendments thereto filed by Metropolitan Life Insurance Company under the Securities Act of 1933 and/or the Investment Company Act of 1940, pertaining to: o Metropolitan Life Separate Account E File No. 002-90380 Preference Plus Account (APPA and BPPA), Enhanced Preference Plus Account (EPPA), Financial Freedom Account (FFA), Preference Plus Account for Enhanced Contracts (CPPA) and VestMet; File No. 333-43970 MetLife Income Security Plan; File No. 333-52366 Preference Plus Select; File No. 333-69320 MetLife Asset Builder VA; File No. 333-80547 MetLife Settlement Plus; File No. 333-83716 MetLife Financial Freedom Select B, L and C Class and MetLife Financial Freedom Select e and e Bonus Class; File No. 333-122883 Preference Plus Income Advantage; File No. 333-122897 MetLife Personal IncomePlus; File No. 333-153109 Preference Premier Variable Annuity; File No. 333-160722 Zenith Accumulator; File No. 333-162586 MetLife Growth and Guaranteed Income Variable Annuity; File No. 333-176654 Preference Premier Variable Annuity; File No. 333-190296 Gold Track Select; and Variable Annuity File No. 333- ) ---------- o Metropolitan Life Separate Account UL File No. 033-32813 MetLife UL II; File No. 033-47927 Equity Advantage VUL and UL II; File No. 033-57320 MetFlex; File No. 033-91226 Group VUL; File No. 333-40161 Equity Additions and Equity Enricher; File No. 333-131664 Advantage Equity Options; File No. 333-147508 Equity Advantage VUL; and Variable Life File No. 333- ) ---------- o Metropolitan Life Variable Annuity Separate Account II File No. 333-138113 Flexible Premium Variable Annuity; File No. 333-138115 Flexible Premium Deferred Variable Annuity; File No. 333-161093 Flexible Premium Variable Annuity (B); File No. 333-161094 Flexible Premium Deferred Variable Annuity (B) o New England Life Retirement Investment Account File No. 333-11133 Preference o New England Variable Annuity Fund I File No. 333-11137 o Paragon Separate Account A File No. 333-133674 AFIS; File No. 333-133699 Group American Plus o Paragon Separate Account B File No. 333-133671 DWS C, Met Flex GVUL C and Multi Manager C, Morgan Stanley product, Putnam product, MFS product and Multi Manager III; File No. 333-133675 DWS D, Met Flex GVUL D and Multi Manager D, and Multi Manager II o Paragon Separate Account C File No. 333-133673 Fidelity C; File No. 333-133678 Fidelity D o Paragon Separate Account D File No. 333-133672 Individual Variable Life; File No. 333-133698 Joint Survivor VUL o Security Equity Separate Account 26 File No. 333-110183 Variable Annuity o Security Equity Separate Account 27 File No. 333-110184 Variable Annuity o Separate Account No. 13 S File No. 333-110185 LCL2 Flexible Premium Variable Life and to have full power and authority to do or cause to be done in my name, place and stead each and every act and thing necessary or appropriate in order to effectuate the same, as fully to all intents and purposes as I might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact or any of them, may do or cause to be done by virtue hereof. This Power of Attorney does not revoke any prior powers of attorney. IN WITNESS WHEREOF, I have hereunto set my hand this 21st day of March, 2014. /s/ Denise M. Morrison ----------------------------- Denise M. Morrison METROPOLITAN LIFE INSURANCE COMPANY POWER OF ATTORNEY Hugh B. Price Director KNOW ALL MEN BY THESE PRESENTS, that I, Hugh B. Price, a Director of Metropolitan Life Insurance Company, a New York company, do hereby constitute and appoint Paul G. Cellupica, Marie C. Swift, Myra L. Saul, John E. Connolly, Jr. and Michele H. Abate, as my attorney-in-fact and agent, each of whom may act individually and none of whom is required to act jointly with any of the others, to sign and file on my behalf and to execute and file any instrument or document required to be filed as part of or in connection with or in any way related to, the Registration Statements and any and all amendments thereto filed by Metropolitan Life Insurance Company under the Securities Act of 1933 and/or the Investment Company Act of 1940, pertaining to: o Metropolitan Life Separate Account E File No. 002-90380 Preference Plus Account (APPA and BPPA), Enhanced Preference Plus Account (EPPA), Financial Freedom Account (FFA), Preference Plus Account for Enhanced Contracts (CPPA) and VestMet; File No. 333-43970 MetLife Income Security Plan; File No. 333-52366 Preference Plus Select; File No. 333-69320 MetLife Asset Builder VA; File No. 333-80547 MetLife Settlement Plus; File No. 333-83716 MetLife Financial Freedom Select B, L and C Class and MetLife Financial Freedom Select e and e Bonus Class; File No. 333-122883 Preference Plus Income Advantage; File No. 333-122897 MetLife Personal IncomePlus; File No. 333-153109 Preference Premier Variable Annuity; File No. 333-160722 Zenith Accumulator; File No. 333-162586 MetLife Growth and Guaranteed Income Variable Annuity; File No. 333-176654 Preference Premier Variable Annuity; File No. 333-190296 Gold Track Select; and Variable Annuity File No. 333- ) ---------- o Metropolitan Life Separate Account UL File No. 033-32813 MetLife UL II; File No. 033-47927 Equity Advantage VUL and UL II; File No. 033-57320 MetFlex; File No. 033-91226 Group VUL; File No. 333-40161 Equity Additions and Equity Enricher; File No. 333-131664 Advantage Equity Options; File No. 333-147508 Equity Advantage VUL; and Variable Life File No. 333- ) ---------- o Metropolitan Life Variable Annuity Separate Account II File No. 333-138113 Flexible Premium Variable Annuity; File No. 333-138115 Flexible Premium Deferred Variable Annuity; File No. 333-161093 Flexible Premium Variable Annuity (B); File No. 333-161094 Flexible Premium Deferred Variable Annuity (B) o New England Life Retirement Investment Account File No. 333-11133 Preference o New England Variable Annuity Fund I File No. 333-11137 o Paragon Separate Account A File No. 333-133674 AFIS; File No. 333-133699 Group American Plus o Paragon Separate Account B File No. 333-133671 DWS C, Met Flex GVUL C and Multi Manager C, Morgan Stanley product, Putnam product, MFS product and Multi Manager III; File No. 333-133675 DWS D, Met Flex GVUL D and Multi Manager D, and Multi Manager II o Paragon Separate Account C File No. 333-133673 Fidelity C; File No. 333-133678 Fidelity D o Paragon Separate Account D File No. 333-133672 Individual Variable Life; File No. 333-133698 Joint Survivor VUL o Security Equity Separate Account 26 File No. 333-110183 Variable Annuity o Security Equity Separate Account 27 File No. 333-110184 Variable Annuity o Separate Account No. 13 S File No. 333-110185 LCL2 Flexible Premium Variable Life and to have full power and authority to do or cause to be done in my name, place and stead each and every act and thing necessary or appropriate in order to effectuate the same, as fully to all intents and purposes as I might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact or any of them, may do or cause to be done by virtue hereof. This Power of Attorney does not revoke any prior powers of attorney. IN WITNESS WHEREOF, I have hereunto set my hand this 17th day of September, 2013. /s/ Hugh B. Price ----------------------------- Hugh B. Price METROPOLITAN LIFE INSURANCE COMPANY POWER OF ATTORNEY Kenton J. Sicchitano Director KNOW ALL MEN BY THESE PRESENTS, that I, Kenton J. Sicchitano, a Director of Metropolitan Life Insurance Company, a New York company, do hereby constitute and appoint Paul G. Cellupica, Marie C. Swift, Myra L. Saul, John E. Connolly, Jr. and Michele H. Abate, as my attorney-in-fact and agent, each of whom may act individually and none of whom is required to act jointly with any of the others, to sign and file on my behalf and to execute and file any instrument or document required to be filed as part of or in connection with or in any way related to, the Registration Statements and any and all amendments thereto filed by Metropolitan Life Insurance Company under the Securities Act of 1933 and/or the Investment Company Act of 1940, pertaining to: o Metropolitan Life Separate Account E File No. 002-90380 Preference Plus Account (APPA and BPPA), Enhanced Preference Plus Account (EPPA), Financial Freedom Account (FFA), Preference Plus Account for Enhanced Contracts (CPPA) and VestMet; File No. 333-43970 MetLife Income Security Plan; File No. 333-52366 Preference Plus Select; File No. 333-69320 MetLife Asset Builder VA; File No. 333-80547 MetLife Settlement Plus; File No. 333-83716 MetLife Financial Freedom Select B, L and C Class and MetLife Financial Freedom Select e and e Bonus Class; File No. 333-122883 Preference Plus Income Advantage; File No. 333-122897 MetLife Personal IncomePlus; File No. 333-153109 Preference Premier Variable Annuity; File No. 333-160722 Zenith Accumulator; File No. 333-162586 MetLife Growth and Guaranteed Income Variable Annuity; File No. 333-176654 Preference Premier Variable Annuity; File No. 333-190296 Gold Track Select; and Variable Annuity File No. 333- ) ---------- o Metropolitan Life Separate Account UL File No. 033-32813 MetLife UL II; File No. 033-47927 Equity Advantage VUL and UL II; File No. 033-57320 MetFlex; File No. 033-91226 Group VUL; File No. 333-40161 Equity Additions and Equity Enricher; File No. 333-131664 Advantage Equity Options; File No. 333-147508 Equity Advantage VUL; and Variable Life File No. 333- ) ---------- o Metropolitan Life Variable Annuity Separate Account II File No. 333-138113 Flexible Premium Variable Annuity; File No. 333-138115 Flexible Premium Deferred Variable Annuity; File No. 333-161093 Flexible Premium Variable Annuity (B); File No. 333-161094 Flexible Premium Deferred Variable Annuity (B) o New England Life Retirement Investment Account File No. 333-11133 Preference o New England Variable Annuity Fund I File No. 333-11137 o Paragon Separate Account A File No. 333-133674 AFIS; File No. 333-133699 Group American Plus o Paragon Separate Account B File No. 333-133671 DWS C, Met Flex GVUL C and Multi Manager C, Morgan Stanley product, Putnam product, MFS product and Multi Manager III; File No. 333-133675 DWS D, Met Flex GVUL D and Multi Manager D, and Multi Manager II o Paragon Separate Account C File No. 333-133673 Fidelity C; File No. 333-133678 Fidelity D o Paragon Separate Account D File No. 333-133672 Individual Variable Life; File No. 333-133698 Joint Survivor VUL o Security Equity Separate Account 26 File No. 333-110183 Variable Annuity o Security Equity Separate Account 27 File No. 333-110184 Variable Annuity o Separate Account No. 13 S File No. 333-110185 LCL2 Flexible Premium Variable Life and to have full power and authority to do or cause to be done in my name, place and stead each and every act and thing necessary or appropriate in order to effectuate the same, as fully to all intents and purposes as I might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact or any of them, may do or cause to be done by virtue hereof. This Power of Attorney does not revoke any prior powers of attorney. IN WITNESS WHEREOF, I have hereunto set my hand this 17th day of September, 2013. /s/ Kenton J. Sicchitano ----------------------------- Kenton J. Sicchitano METROPOLITAN LIFE INSURANCE COMPANY POWER OF ATTORNEY Lulu C. Wang Director KNOW ALL MEN BY THESE PRESENTS, that I, Lulu C. Wang, a Director of Metropolitan Life Insurance Company, a New York company, do hereby constitute and appoint Paul G. Cellupica, Marie C. Swift, Myra L. Saul, John E. Connolly, Jr. and Michele H. Abate, as my attorney-in-fact and agent, each of whom may act individually and none of whom is required to act jointly with any of the others, to sign and file on my behalf and to execute and file any instrument or document required to be filed as part of or in connection with or in any way related to, the Registration Statements and any and all amendments thereto filed by Metropolitan Life Insurance Company under the Securities Act of 1933 and/or the Investment Company Act of 1940, pertaining to: o Metropolitan Life Separate Account E File No. 002-90380 Preference Plus Account (APPA and BPPA), Enhanced Preference Plus Account (EPPA), Financial Freedom Account (FFA), Preference Plus Account for Enhanced Contracts (CPPA) and VestMet; File No. 333-43970 MetLife Income Security Plan; File No. 333-52366 Preference Plus Select; File No. 333-69320 MetLife Asset Builder VA; File No. 333-80547 MetLife Settlement Plus; File No. 333-83716 MetLife Financial Freedom Select B, L and C Class and MetLife Financial Freedom Select e and e Bonus Class; File No. 333-122883 Preference Plus Income Advantage; File No. 333-122897 MetLife Personal IncomePlus; File No. 333-153109 Preference Premier Variable Annuity; File No. 333-160722 Zenith Accumulator; File No. 333-162586 MetLife Growth and Guaranteed Income Variable Annuity; File No. 333-176654 Preference Premier Variable Annuity; File No. 333-190296 Gold Track Select; and Variable Annuity File No. 333- ) ---------- o Metropolitan Life Separate Account UL File No. 033-32813 MetLife UL II; File No. 033-47927 Equity Advantage VUL and UL II; File No. 033-57320 MetFlex; File No. 033-91226 Group VUL; File No. 333-40161 Equity Additions and Equity Enricher; File No. 333-131664 Advantage Equity Options; File No. 333-147508 Equity Advantage VUL; and Variable Life File No. 333- ) ---------- o Metropolitan Life Variable Annuity Separate Account II File No. 333-138113 Flexible Premium Variable Annuity; File No. 333-138115 Flexible Premium Deferred Variable Annuity; File No. 333-161093 Flexible Premium Variable Annuity (B); File No. 333-161094 Flexible Premium Deferred Variable Annuity (B) o New England Life Retirement Investment Account File No. 333-11133 Preference o New England Variable Annuity Fund I File No. 333-11137 o Paragon Separate Account A File No. 333-133674 AFIS; File No. 333-133699 Group American Plus o Paragon Separate Account B File No. 333-133671 DWS C, Met Flex GVUL C and Multi Manager C, Morgan Stanley product, Putnam product, MFS product and Multi Manager III; File No. 333-133675 DWS D, Met Flex GVUL D and Multi Manager D, and Multi Manager II o Paragon Separate Account C File No. 333-133673 Fidelity C; File No. 333-133678 Fidelity D o Paragon Separate Account D File No. 333-133672 Individual Variable Life; File No. 333-133698 Joint Survivor VUL o Security Equity Separate Account 26 File No. 333-110183 Variable Annuity o Security Equity Separate Account 27 File No. 333-110184 Variable Annuity o Separate Account No. 13 S File No. 333-110185 LCL2 Flexible Premium Variable Life and to have full power and authority to do or cause to be done in my name, place and stead each and every act and thing necessary or appropriate in order to effectuate the same, as fully to all intents and purposes as I might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact or any of them, may do or cause to be done by virtue hereof. This Power of Attorney does not revoke any prior powers of attorney. IN WITNESS WHEREOF, I have hereunto set my hand this 17th day of September, 2013. /s/ Lulu C. Wang ----------------------------- Lulu C. Wang METROPOLITAN LIFE INSURANCE COMPANY POWER OF ATTORNEY John C.R. Hele Executive Vice President and Chief Financial Officer KNOW ALL MEN BY THESE PRESENTS, that I, John C.R. Hele, Executive Vice President and Chief Financial Officer of Metropolitan Life Insurance Company, a New York company, do hereby constitute and appoint Paul G. Cellupica, Marie C. Swift, Myra L. Saul, John E. Connolly, Jr. and Michele H. Abate, as my attorney-in-fact and agent, each of whom may act individually and none of whom is required to act jointly with any of the others, to sign and file on my behalf and to execute and file any instrument or document required to be filed as part of or in connection with or in any way related to, the Registration Statements and any and all amendments thereto filed by Metropolitan Life Insurance Company under the Securities Act of 1933 and/or the Investment Company Act of 1940, pertaining to: o Metropolitan Life Separate Account E File No. 002-90380 Preference Plus Account (APPA and BPPA), Enhanced Preference Plus Account (EPPA), Financial Freedom Account (FFA), Preference Plus Account for Enhanced Contracts (CPPA) and VestMet; File No. 333-43970 MetLife Income Security Plan; File No. 333-52366 Preference Plus Select; File No. 333-69320 MetLife Asset Builder VA; File No. 333-80547 MetLife Settlement Plus; File No. 333-83716 MetLife Financial Freedom Select B, L and C Class and MetLife Financial Freedom Select e and e Bonus Class; File No. 333-122883 Preference Plus Income Advantage; File No. 333-122897 MetLife Personal IncomePlus; File No. 333-153109 Preference Premier Variable Annuity; File No. 333-160722 Zenith Accumulator; File No. 333-162586 MetLife Growth and Guaranteed Income Variable Annuity; File No. 333-176654 Preference Premier Variable Annuity; File No. 333-190296 Gold Track Select; and Variable Annuity File No. 333- ) ---------- o Metropolitan Life Separate Account UL File No. 033-32813 MetLife UL II; File No. 033-47927 Equity Advantage VUL and UL II; File No. 033-57320 MetFlex; File No. 033-91226 Group VUL; File No. 333-40161 Equity Additions and Equity Enricher; File No. 333-131664 Advantage Equity Options; File No. 333-147508 Equity Advantage VUL; and Variable Life File No. 333- ) ---------- o Metropolitan Life Variable Annuity Separate Account II File No. 333-138113 Flexible Premium Variable Annuity; File No. 333-138115 Flexible Premium Deferred Variable Annuity; File No. 333-161093 Flexible Premium Variable Annuity (B); File No. 333-161094 Flexible Premium Deferred Variable Annuity (B) o New England Life Retirement Investment Account File No. 333-11133 Preference o New England Variable Annuity Fund I File No. 333-11137 o Paragon Separate Account A File No. 333-133674 AFIS; File No. 333-133699 Group American Plus o Paragon Separate Account B File No. 333-133671 DWS C, Met Flex GVUL C and Multi Manager C, Morgan Stanley product, Putnam product, MFS product and Multi Manager III; File No. 333-133675 DWS D, Met Flex GVUL D and Multi Manager D, and Multi Manager II o Paragon Separate Account C File No. 333-133673 Fidelity C; File No. 333-133678 Fidelity D o Paragon Separate Account D File No. 333-133672 Individual Variable Life; File No. 333-133698 Joint Survivor VUL o Security Equity Separate Account 26 File No. 333-110183 Variable Annuity o Security Equity Separate Account 27 File No. 333-110184 Variable Annuity o Separate Account No. 13 S File No. 333-110185 LCL2 Flexible Premium Variable Life and to have full power and authority to do or cause to be done in my name, place and stead each and every act and thing necessary or appropriate in order to effectuate the same, as fully to all intents and purposes as I might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact or any of them, may do or cause to be done by virtue hereof. This Power of Attorney does not revoke any prior powers of attorney. IN WITNESS WHEREOF, I have hereunto set my hand this 6th day of September, 2013. /s/ John C.R. Hele ----------------------------- John C.R. Hele METROPOLITAN LIFE INSURANCE COMPANY POWER OF ATTORNEY Peter M. Carlson Executive Vice President and Chief Accounting Officer KNOW ALL MEN BY THESE PRESENTS, that I, Peter M. Carlson, Executive Vice President and Chief Accounting Officer of Metropolitan Life Insurance Company, a New York company, do hereby constitute and appoint Paul G. Cellupica, Marie C. Swift, Myra L. Saul, John E. Connolly, Jr. and Michele H. Abate, as my attorney-in-fact and agent, each of whom may act individually and none of whom is required to act jointly with any of the others, to sign and file on my behalf and to execute and file any instrument or document required to be filed as part of or in connection with or in any way related to, the Registration Statements and any and all amendments thereto filed by Metropolitan Life Insurance Company under the Securities Act of 1933 and/or the Investment Company Act of 1940, pertaining to: o Metropolitan Life Separate Account E File No. 002-90380 Preference Plus Account (APPA and BPPA), Enhanced Preference Plus Account (EPPA), Financial Freedom Account (FFA), Preference Plus Account for Enhanced Contracts (CPPA) and VestMet; File No. 333-43970 MetLife Income Security Plan; File No. 333-52366 Preference Plus Select; File No. 333-69320 MetLife Asset Builder VA; File No. 333-80547 MetLife Settlement Plus; File No. 333-83716 MetLife Financial Freedom Select B, L and C Class and MetLife Financial Freedom Select e and e Bonus Class; File No. 333-122883 Preference Plus Income Advantage; File No. 333-122897 MetLife Personal IncomePlus; File No. 333-153109 Preference Premier Variable Annuity; File No. 333-160722 Zenith Accumulator; File No. 333-162586 MetLife Growth and Guaranteed Income Variable Annuity; File No. 333-176654 Preference Premier Variable Annuity; File No. 333-190296 Gold Track Select; and Variable Annuity File No. 333- ) ---------- o Metropolitan Life Separate Account UL File No. 033-32813 MetLife UL II; File No. 033-47927 Equity Advantage VUL and UL II; File No. 033-57320 MetFlex; File No. 033-91226 Group VUL; File No. 333-40161 Equity Additions and Equity Enricher; File No. 333-131664 Advantage Equity Options; File No. 333-147508 Equity Advantage VUL; and Variable Life File No. 333- ) ---------- o Metropolitan Life Variable Annuity Separate Account II File No. 333-138113 Flexible Premium Variable Annuity; File No. 333-138115 Flexible Premium Deferred Variable Annuity; File No. 333-161093 Flexible Premium Variable Annuity (B); File No. 333-161094 Flexible Premium Deferred Variable Annuity (B) o New England Life Retirement Investment Account File No. 333-11133 Preference o New England Variable Annuity Fund I File No. 333-11137 o Paragon Separate Account A File No. 333-133674 AFIS; File No. 333-133699 Group American Plus o Paragon Separate Account B File No. 333-133671 DWS C, Met Flex GVUL C and Multi Manager C, Morgan Stanley product, Putnam product, MFS product and Multi Manager III; File No. 333-133675 DWS D, Met Flex GVUL D and Multi Manager D, and Multi Manager II o Paragon Separate Account C File No. 333-133673 Fidelity C; File No. 333-133678 Fidelity D o Paragon Separate Account D File No. 333-133672 Individual Variable Life; File No. 333-133698 Joint Survivor VUL o Security Equity Separate Account 26 File No. 333-110183 Variable Annuity o Security Equity Separate Account 27 File No. 333-110184 Variable Annuity o Separate Account No. 13 S File No. 333-110185 LCL2 Flexible Premium Variable Life and to have full power and authority to do or cause to be done in my name, place and stead each and every act and thing necessary or appropriate in order to effectuate the same, as fully to all intents and purposes as I might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact or any of them, may do or cause to be done by virtue hereof. This Power of Attorney does not revoke any prior powers of attorney. IN WITNESS WHEREOF, I have hereunto set my hand this 16th day of September, 2013. /s/ Peter M. Carlson ----------------------------- Peter M. Carlson